The Daily: SEC Ramps Up Enforcement, 60% of Smart Contracts Are Dormant

SEC Suspends Trading of XBT Provider's Bitcoin Exchange-Traded Product

In Saturday’s edition of The Daily, we take a look at the SEC’s annual report, which reveals where cryptocurrencies sit on their radar. We also consider the fate of dormant smart contracts, 60% of which have never seen use according to a new report. All that plus the reaction to Coinbase’s latest token listing, which hasn’t pleased everyone.

Also read: ‘Decentralized’ Exchange IDEX to Introduce Full KYC

SEC Zeroes in on Cryptocurrency Scams

The U.S. Securities and Exchange Commission (SEC) has released its annual report and the 45-page document has plenty to say about cryptocurrency. Initial coin offerings (ICOs) are referenced more than 30 times in the report, which notes: “In the past year, the Division has opened dozens of investigations involving ICOs and digital assets, many of which were ongoing at the close of FY [financial year] 2018.” The report also explains that the SEC isn’t just looking at ICOs, but at other potential scams being perpetrated within the cryptocurrency space. It finishes:

The Division also has recommended that the Commission use its trading suspension authority to prevent investors from being harmed by possible scams … the Commission suspended trading in the stock of over a dozen publicly traded issuers because of questions concerning, among other things, the accuracy of assertions regarding their investments in ICOs and operation of cryptocurrency platforms.

The SEC’s report surfaced just as it emerged that another celebratory is facing a lawsuit over their promotion of a dubious ICO. Clifford Joseph Harris Jr., better known as T.I., is being charged over his involvement with “flik token,” which investors were promised would increase by 25,000 percent. It didn’t.

60% of Smart Contracts Have Never Been Used

The Daily: SEC Ramps Up Enforcement, 60% of Smart Contracts Are DormantResearchers at Northeastern University and the University of Maryland have pored over the code governing Ethereum smart contracts and emerged with some interesting findings. Of the 1.2 million smart contracts they examined, the vast majority were clones or extremely similar to one another. As a result, they found there to be less than 6,000 unique smart contract “clusters.”

The danger with such widespread usage of code, as the researchers pointed out, is that vulnerabilities are likely to spread far and wide throughout the ecosystem. There is one saving grace, however, that might limit the fallout from a widespread bug: around 60% of all Ethereum smart contracts have never been interacted with. These “ghost contracts” remain dormant, deprived of users willing to spend the gas required to trigger them.

New Coinbase Listing – Brave or Foolish?

On Nov. 2, Coinbase Pro announced that the latest token to be added to its exchange would be BAT, the advertising rewards-based currency used within the Brave browser. While the news was hailed in some quarters, not least among BAT bagholders, not everyone was impressed. “Welp, it’s official,” tweeted Dan Elitzer. “Coinbase’s lawyers are comfortable with listing digital Chuck-E-Cheese tokens. The Howey Test is clearly out the window.” Jackson Palmer, meanwhile picked holes in Brave’s integration of BAT, and suggested the browser would operate more effectively without the token:

The Daily: SEC Ramps Up Enforcement, 60% of Smart Contracts Are Dormant

What are your thoughts on today’s news tidbits as featured in The Daily? Let us know in the comments section below.


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Brazil’s Tax Authority Goes After Cryptocurrency Profits

Brazil's Tax Authority Goes After Cryptocurrency Profits

Brazil’s tax authority has published proposals to regulate the cryptocurrency landscape over concerns digital assets are being used to launder money and evade tax. A document released by the Department of Federal Revenue of Brasil (RFB) disclosed plans that will force cryptocurrency traders to reveal their identities and for exchanges to submit financial reports to the authority each month.

Also Read: Africa Dominates Trade Volume on P2P Bitcoin Exchange Paxful

  Draft Tax Guidelines Compel Exchanges to Furnish RFB With Monthly Financial Reports

Brazil’s Tax Authority Goes After Cryptocurrency Profits

In proposals released earlier this week, the RFB stated that all digital currency exchanges in Brazil are now required to provide monthly updates of financial performance, including personal information of dealers. The ancillary obligations are for tax compliance purposes and also to prevent alleged money laundering, the regulator said. RFB indicated that this will help bring transparency and confidence to a sector that in the last five years has seen explosive growth – so big that the number of cryptocurrency investors has eclipsed that of those trading in common stocks on Brazil’s Sao Paulo-based B3 Stock Exchange.

The draft means that traders would no longer be able to operate anonymously. Until now, anybody buying and selling bitcoin and other digital currencies have been able to do so anonymously, allegedly making it attractive to criminals and tax dodgers, the authority claims.

According to the RFB, Brazilian residents and companies that transact more than 10,000 reals (about $2,700) on foreign cryptocurrency exchanges per month are required to report this information. Individuals who fail to comply by delaying tax declarations face a fine of $400 while a three-percent fee on the transaction value will be levied against those who lie about their income or provide insufficient information.

Brazil’s Cryptocurrency Industry Sees Rapid Growth

The value of cryptocurrency traded on exchanges in the Latin American country has swelled from just $12.1 million in 2014 to $2.24 billion at the end of last year, as investors piled into an industry which thrives on anonymity and less regulation. The Department of Federal Revenue of Brasil has guided trade volumes to reach between $4.86 billion and $12.15 billion this year.

Brazil’s Tax Authority Goes After Cryptocurrency Profits

“The numbers, and their annual growth, demonstrate the relevance of the cryptocurrency market in Brazil, especially for the tax administration, since these transactions are subject to income tax on capital gains,” the RFB detailed. “The search for anonymity, which is one of the main attractions for the use of certain cryptocurrencies, must always be fought, including by the tax authority.”

The tax collector is accepting public input to the draft guidelines between now and Nov. 19. The proposals come in the wake of a recent court ruling which compelled Banco do Brasil and Banco Santander to reopen the bank accounts of cryptocurrency exchange Bitcoin Max that were closed in September without explanation. The two banks have since reactivated the accounts to avoid paying fines of between $1,350 and $5,400.

What do you think about the cryptocurrency proposals in Brazil. Let us know in the comments section below.


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Verify and track bitcoin cash transactions on our BCH Block Explorer, the best of its kind anywhere in the world. Also, keep up with your holdings, BCH and other coins, on our market charts at Satoshi’s Pulse, another original and free service from Bitcoin.com.

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Regulations Roundup: Ebang IPO Challenged by Probe, Plattsburgh Passes Mining Guidelines

Regulations Roundup: Ebang IPO Challenged by Criminal Probe, Plattsburgh Passes New Mining Guidelines

In recent regulatory news, a criminal investigation may prevent Ebang from conducting an initial public offering, Plattsburgh has passed new regulations governing commercial mining operations, and Ron Paul has endorsed precious metals and cryptocurrencies as a viable alternative to fiat currency.

Also Read: Another Token Project Launches on the Bitcoin Cash Network

Criminal Accusations Pose Hurdle to Ebang IPO

Regulations Roundup: Ebang IPO Challenged by Probe, Plattsburgh Passes Mining GuidelinesReports are alleging that major mining manufacturer Ebang Communications has become embroiled in a criminal investigation that may pose a challenge to the company’s initial public offering intentions.

The investigation pertains to a transaction valued at 524.9 million Chinese yuan (approximately $76.18 million) between Ebang and wealth management company Yindou.com. Between March and April, it is alleged that Ebang transferred 380 million yuan (roughly $55.15 million), leaving 144.9 million yuan (approximately $21 million).

According to Sina Finance, Ebang is accused of receiving the remaining funds in exchange for potentially laundering money, inflating sales revenue, or collecting a fictitious sales contract in order to bolster the company’s chances at securing its attempted public listing on the Hong Kong Stock Exchange (Hkex).

According to a rough translation, Sina asserts that investors “submitted questioning material to Hkex to prevent Ebang International from listing in Hong Kong” on Oct. 12.

Plattsburgh Council Passes New Regulations for Commercial Miners

Regulations Roundup: Ebang IPO Challenged by Probe, Plattsburgh Passes Mining GuidelinesThe Plattsburgh Common Council has passed regulations mandating new noise and fire safety requirements for commercial mining facilities. The legislation was unanimously passed last week.

According to Sun Community News, the new guidelines state that “no mining facility can produce noise above 90 decibels that can be heard further than 25 feet from the exterior of the building,” and mandate that miners apply for special use permits.

The new rules will apply to miners operating in the City of Plattsburgh, New York in 11 months time – once the current 18-month moratorium on commercial mining in Plattsburgh has been lifted.

Ron Paul Advocates Adoption of Precious Metals and Cryptocurrencies

Regulations Roundup: Ebang IPO Challenged by Probe, Plattsburgh Passes Mining GuidelinesRetired American politician Ron Paul recently published an article describing the Federal Reserve as “crazy.”

The article asserts that “government-created fiat currency” is “anything but stable,” arguing that “Central banks constantly increase and decrease the money supply in an attempt to control the economy by controlling the interest rates.” Paul argues that such policies “create an illusion of prosperity,” however when “reality catches up… there is a recession or worse, leading the Fed to start the whole boom-and-bust cycle over again.”

Paul asserts that “market money” is a viable alternative to fiat money, advocating for the passing of the “Audit the Fed bill,” which would allow “people to use alternative currencies, and exempting all transactions in precious metals and cryptocurrencies from capital gains taxes and other taxes.”

Do you think Ebang’s initial public offering will be halted? Share your thoughts in the comments section below! 


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Top Three South Korean Cryptocurrency Exchanges Expand Overseas

Three of South Korea’s largest cryptocurrency exchanges are expanding overseas. Upbit has launched a Singaporean crypto exchange with 156 coins and 221 trading pairs. Coinone has established a crypto exchange in Malta while Bithumb is planning to launch a security token platform in the U.S.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Bithumb to Launch US Security Token Platform

Top Three South Korean Cryptocurrency Exchanges Expand OverseasOne of South Korea’s largest crypto exchanges by trading volume, Bithumb, announced its partnership with U.S. fintech company Seriesone on Oct. 31.

Under the agreement, “Bithumb is investing in a Seriesone entity in South Korea to scale technical development and marketing,” Seriesone detailed, elaborating:

Bithumb and Seriesone will form a joint venture intended to create a new exchange in the United States that will offer a compliant marketplace to trade security tokens, subject to receipt of SEC, FINRA and other applicable regulatory approvals.

Top Three South Korean Cryptocurrency Exchanges Expand Overseas

Bithumb was recently acquired by Singapore-based Bk Global Consortium led by a plastic surgeon. The group inked a deal with BTC Korea Holdings, Bithumb’s largest shareholder at the time with 75.99 percent interest, to buy a controlling stake in the exchange.

Seriesone recently appointed Kaine Kim, former deputy director of South Korea’s Financial Services Commission, as managing director of its South Korean operation and head of Asian operations.

Upbit Singapore Now Live

Top Three South Korean Cryptocurrency Exchanges Expand OverseasAnother major crypto exchange in South Korea, the Kakao-backed Upbit, announced the official launch of its Singaporean exchange on Oct. 30. The new exchange is headed by Alex Kim, who previously served as the head of Kakao Indonesia, according to the Investor publication.

Upbit, operated by Dunamu Inc., is a partner of U.S.-based exchange Bittrex. Dunamu CEO Lee Sir-goo said in September that Upbit will continue to strengthen its partnership with Bittrex as it makes a foray into global markets. Noting that Upbit Singapore will initially support only one fiat currency, the Singapore dollar (SGD), he described:

In the future, we would like to add other fiat currencies and expand in other Southeast Asian countries.

Top Three South Korean Cryptocurrency Exchanges Expand OverseasWith 156 coins and 221 trading pairs listed currently, Upbit Singapore supports trading in the SGD, BTC, ETH, and USDT markets. “Any user who cleared identity verification” can use the exchange, Upbit Singapore clarified.

For the grand opening, all new users are offered zero-percent trading fees until Nov. 28 on the SGD market. Zero-percent trading fees are also offered until Dec. 28 on the same market to existing users who signed up and cleared real-name identity verification by Oct. 29.

Coinone Launches CGEX

Top Three South Korean Cryptocurrency Exchanges Expand OverseasCoinone officially launched its crypto-only exchange CGEX on Oct. 29. “CGEX is not a legal currency but a crypto-based (C2C, crypto-to-crypto) cryptocurrency exchange” with the same trading pairs as the Coinone BTC market, the exchange described. Deposits and withdrawals began on Oct. 29 while trading began on Oct. 30. The exchange is established in Malta and is offering zero-percent commission on makers in the first month of opening.

Top Three South Korean Cryptocurrency Exchanges Expand Overseas

Coinone wrote:

The new global crypto-crypto exchange will share its order book with Coinone’s new BTC market … CGEX provides stable liquidity to investors by integrating with Coinone Korea, Indonesia, and others under the Coinone brand.

What do you think of the three Korean exchanges launching operations overseas? Let us know in the comments section below.


Images courtesy of Shutterstock, Bithumb, Upbit, and Coinone.


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Another Token Project Launches on the Bitcoin Cash Network

Another Token Project Launches on the Bitcoin Cash Network

A new smart contract and tokenization system has been launched on the Bitcoin Cash (BCH) network. On Oct. 31, BCH developer Clemens Ley released the alpha version of Bitcoin Token, a Javascript library built to develop autonomous contracts, BCH-based tokens, and integrate payments into web applications.

Also read: New Bitcoin Cash Stress Test Sees 700,000 Transactions in One Day

Project Bitcoin Token Launches Alpha Version

Another Token Project Launches on the Bitcoin Cash NetworkIn August, news.Bitcoin.com reported on a project called Bitcoin Token developed by software programmer Clemens Ley. At the time, the developer explained that the project was in its prototype stage and had plans to launch at the end of the year. Now the creator has launched the alpha version of Bitcoin Token, which gives developers three tools to enable the assembly of applications on the Bitcoin Cash network. The software contains a wallet, a database, and the token solution. The 0.0.1 alpha has been downloaded 103 times.

The Bitcoin Token project has published documentation on compiling the implementation as well. The specifications detail the program’s tech-stack which includes the application build, tokenization abilities, Bitdb, and the source containing a readable Javascript BCH implementation. However, the source code is not publicly available yet but the developer is offering an early version by email. The Bitcoin Token creator says that the project’s alpha release currently supports fungible tokens, which operate similarly to Ethereum’s ERC-20 tokens. At the moment smart contract support on Bitcoin Token is not yet available.

Another Token Project Launches on the Bitcoin Cash Network

Clemens Ley’s Creation Becomes the 5th BCH-Based Token Project

Another Token Project Launches on the Bitcoin Cash Network
Clemens Ley.

The Bitcoin Token project was welcomed by the BCH community when the alpha release was announced on Twitter and Reddit. Some commenters on Reddit liked the idea that Bitcoin Token was an alternative to Wormhole while others asked why the source code was not yet available. Ley’s project joins the slew of other token projects that have been introduced to the Bitcoin Cash network like the Simple Ledger Protocol, Colored Coins, Keoken, and of course Wormhole. Even though the Bitcoin Token protocol uses a similar system to ERC-20, tokens will not clog up the chain with crypto-kittie coins. Ley firmly believes the BCH chain can do far better than the Ethereum network’s token process coupled with scaling.

“Bitcoin Cash can do pretty much everything Ethereum can do – but at a 10-100x lower cost,” the Bitcoin Token creator detailed on a pinned thread on Twitter.

Coingeek Reveals Another Token Solution

The day after the Bitcoin Token alpha release, Bitcoin Cash proponents heard about a different project developed by James Belding, Samuel Georges, Scott Barr, Farid Uddeen, and Brendan Lee. It has been revealed that these developers won the tokenization contest hosted by Coingeek and took home the grand prize of £5,000,000 ($6.4 million).

According to the press release, the new token project built for Coingeek uses existing technology already available on the BCH network. The project does have a website where people can request more information. According to the site, the whitepaper will be published soon. Coingeek’s press statements detail the project’s technical specifications should be available by mid-November.

Since the hard fork last May, there’s been a good portion of token and smart contract projects built for BCH and one of them wants to corner the market. The alpha release of Bitcoin Token marks the 5th project attempting to provide users with tokenization abilities on top of the BCH chain. When launched, Coingeek’s project will be the 6th.

What do you think about the Bitcoin Token alpha release by Clemens Ley? Let us know what you think about this subject in the comments section below.


Images via Shutterstock, the Bitcoin Token Project, Jamie Redman, and Twitter.


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‘Decentralized’ Exchange IDEX to Introduce Full KYC

IDEX, the world’s most popular decentralized exchange, is to transition to a full verification model. The move comes days after the platform began excluding residents of New York State as part of its compliance efforts. Its latest measure, described by IDEX as “pragmatic decentralization” has drawn ire from a segment of the cryptocurrency community.

Also read: China Updates Crypto Ranking, Downgrades BTC Further

IDEX Goes Full KYC

A cryptocurrency exchange introducing know your customer (KYC) requirements is not generally headline news. When the platform in question is a decentralized exchange (DEX), however, typically one of the last outposts of privacy, it’s a major talking point. IDEX’s decision will be monitored closely by the cryptocurrency community to see whether it is an isolated incident or the shape of things to come. IDEX’s dominant position within the DEX market, capturing around 7x the trading volume of its nearest competitor, means it exerts significant influence.

‘Decentralized’ Exchange IDEX to Introduce Full KYC

Explaining its transition to a full KYC model, IDEX wrote: “Decentralization exists on a spectrum, and unless your system or application lacks any centralized parts it can be subject to regulation. Aurora is working to create a fully-decentralized financial system, but the path to getting there requires significantly more control and centralization than the end state. In addition to IP blocking, IDEX will be implementing KYC/AML policies in order to comply with sanctions and money laundering laws.”

Same Security, Less Privacy

‘Decentralized’ Exchange IDEX to Introduce Full KYCTraders tend to use decentralized exchanges for three reasons: custody (they retain control of their funds at all times, mitigating the likelihood of theft), privacy (no KYC means not having to disclose your activities to the authorities, or risk having your identity stolen) and finally to gain access to desirable tokens before they make it into a major exchange. With the privacy element removed from the equation, all that’s left is the marginal benefit of greater security and the equally slender benefit of accessing newly unlocked tokens.

Profiting from trading IDEX tokens is extremely difficult in the current market climate, and the added inconvenience of needing to register for the privilege may be the last straw for many traders. Trading volume and the number of active users have both dropped sharply since IDEX announced its new KYC policy a day ago, though it is too early to conclusively link the two events. In the coming weeks, a clearer picture should emerge of the effect that IDEX’s new policy has had on the platform’s trading activity.

First Shapeshift, Now IDEX

In the closing remarks to its lengthy blogpost on “pragmatic decentralization,” IDEX referenced Shapeshift, the cryptocurrency-changing service which was also forced to go full KYC recently, under pressure from U.S. regulators. It concluded:

Over the next few months IDEX will begin instituting KYC procedures for all users to comply with both AML and sanctions laws. Like other exchanges, IDEX will have tiers which correlate with the amount of funds users are able to move through the service. Those trading a small amount of funds will be required to provide a minimal amount of information, while those who wish to trade larger amounts will need to undergo additional KYC steps.

There is an emerging trend for cryptocurrency exchanges that are accessible from the U.S. to kowtow to regulatory pressure out of fear or threat of being shut down. For now, there remain other decentralized platforms and protocols where cryptocurrency users can ply their trade. The question is for how long.

What are your thoughts on IDEX introducing KYC? Let us know in the comments section below.


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PR: Coinseed Announces Crypto Cash Back Program

Coinseed Announces Crypto Cash Back Program

This is a paid press release, which contains forward looking statements, and should be treated as advertising or promotional material. Bitcoin.com does not endorse nor support this product/service. Bitcoin.com is not responsible for or liable for any content, accuracy or quality within the press release.

In the US, we all love cash backs as merchants or financial institutions reward small amounts of money to its users for using or buying their products. Well, how about earn that cash back money in crypto instead of good old US dollars?

This is exactly what Coinseed app is doing with their latest product feature. Coinseed lets you invest your spare change in crypto and it makes perfect sense for their users to have this feature.

It takes only 30 seconds to signup on Coinseed and it is completely free. Once you create an account, you can simply select one of the listed online merchants from the app and it will take you straight to the online shop where you can complete your purchase. The list of merchants include Ebay, Walmart, Microsoft, Panasonic and many more. They are continuously expanding this list of merchants.

Once you complete your purchase, you can earn your rewards back in any of the 13 major coins such as Bitcoin, Ethereum and Litecoin. The cash back amount range from 1-8% of the purchase amount. This rate is also getting better over time so join the crowd!

For questions, please contact [email protected].

Supporting Link
https://coinseed.app.link/4EpzyCJGtR

This is a paid press release. Readers should do their own due diligence before taking any actions related to the promoted company or any of its affiliates or services. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in the press release.

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New Bitcoin Cash Stress Test Sees 700,000 Transactions in One Day

New Bitcoin Cash Stress Test Sees 700,000 Transactions in One Day

On Thursday, Nov. 1, a group of Bitcoin Cash (BCH) proponents who call themselves the Professional Stress Test Team, performed a network stress test on the BCH chain. During the course of the day, the BCH network saw over 733,000 transactions and a 14MB block that cleared 73,000 transactions in one fell swoop.

Also read: Anypay Provides BCH Invoices That Can Be Paid by Sending a Text

Bitcoin Cash Network Shrugs Off Another Stress Test

The Bitcoin Cash Professional Stress Test Team wrapped up another 24 hours of sending thousands of transactions and recording all the data on Nov. 1. According to the team’s Taste Test Report, the group constructed a transaction fan-out tool they called the DoW, which includes seven full nodes using three of the most popular bitcoin clients — Bitcoin Unlimited, ABC, and SV. Full node implementations for the stress test were dispersed around the world in the U.S., Finland, Belgium, and Hong Kong. When the stress test began, the BCH was added to the DoW’s UTXO management system, which split the transactions into multiple UTXOs that ranged in value between 15,000 to 15,000,000 satoshis.

New Bitcoin Cash Stress Test Sees 700,000 Transactions in One Day
BCH transactions (tx) historical view shows 733,782 tx processed on Nov. 1, 2018.  

Following this step, the UTXOs were held in a Walker process, a method that fans out the transactions and splits them into 20 to 2,900 new UTXOs. Each Walker process waits for the fan-outs to be confirmed on the BCH chain before starting again. Loading the Walkers is a manual process, the team detailed, and the group is in the midst of creating an automated loader. The way the stress test method is currently done is quite “time-consuming” and leads to a “delay in activation of all Walkers.” During the first phase of the test, the team experienced multiple Walker failures and random delays. “Nodes running Bitcoin Unlimited did not experience failures of this kind, while the Bitcoin SV (which still has the delay in place) and Bitcoin ABC nodes all failed to varying degrees,” explained the team. The stress testers continued by stating:

After the first 140,000 transactions were sent, the team spent some time making an analysis of what the issues were, and re-gathering UTXOs from failed walkers, and re-started the test.

New Bitcoin Cash Stress Test Sees 700,000 Transactions in One Day

The Outcome: A Cleared Mempool, Big Blocks, and 1/10th of a US Penny Per Transaction

New Bitcoin Cash Stress Test Sees 700,000 Transactions in One Day
“At this point, a further test was begun with a large number of small UTXOs resulting in the following: As can be seen, from 5.44pm to 5.53pm approximately 66,000 transactions were sent onto the network, or a rate of approximately 122 per minute. This culminated in a 10MB block which emptied the Mempool.”

At the end of the day, the team finished up the stress test with the final blast, utilizing all the remaining funds from the failed transactions left in the wallet. The developers detailed that this test was the “most optimized in terms of success rate” and there was a much lower failure rate this time around (less than 0.2 percent transaction failure). According to 24-hour statistics, the BCH chain processed 733,782 transactions during the course of the Nov. 1 stress test. The stress test organization also plans on assembling a large-scale test on Nov. 17, after the proposed network hard fork two days prior.

The group emphasized they were pleased with the DoW’s performance but they expect to be ready to handle a lot more capacity on Nov. 10. At that time the team expects to send 250-300 transactions per second onto the BCH network within a 1-hour time span. “This rate will need to be sustained indefinitely (24 hours at least) to achieve the goals laid out in the Professional Stress Test roadmap, and we look forward to delivering on this promise,” the stress testers conclude.               

The Nov. 1 stress test was smaller than the test held on Sept. 1 and the four days of testing that followed. However, there were some notable achievements this Thursday, with block 554751 being the largest block mined during the day. The 14MB block processed held 73,000 transactions and the miner earned 0.14320561BCH in fees. Another block mined by the operation SV-Pool, processed a 9.3MB block with over 44,000 transactions. Just like last September, even though there were hundreds of thousands of transactions sent that day, the mempool (transaction queue) was cleared quite easily and network fees remained extremely low the entire day.

What do you think about the Nov. 1 stress test and the data that was found? Do you like to see network stress tests? Let us know what you think about this subject in the comments section below.  


Images via Shutterstock, Pixabay, and the ‘Taste Test Report.’


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The Daily: Coinbase Launches Investment Fund, Cointext Enters New Markets

The Daily: Coinbase Launches Investment Fund, Cointext Enters New Markets

In this edition of The Daily, we look at Coinbase’s decision to create a new investment vehicle for institutions in partnership with asset manager Wilshire Phoenix. We also cover the expansion of bitcoin cash SMS wallet service Cointext into four new markets. Also, New Zealand’s financial regulator has issued a warning against a platform offering cryptocurrency trading services.  

Also read: Consensys Acquires Planetary Resources, New Zealand Backs Crypto R&D

Coinbase Custody and Wilshire Phoenix Launch Cryptocurrency Fund

The Daily: Coinbase Launches Investment Fund, Cointext Enters New MarketsCryptocurrency exchange Coinbase has entered into a partnership agreement with asset management company Wilshire Phoenix. The deal aims to establish a new $500 million fund that will offer institutional investors exposure to digital assets. The partners revealed the underlying approach will be to mitigate the risks associated with market volatility and the current drop in cryptocurrency prices. At the same time, the fund will not use derivatives or other leverage tools to achieve its main objective, which is to limit counterparty exposure and the additional fees associated with such investments.

The new investment vehicle is the latest addition to an array of institutional products offered by Coinbase. News about the joint venture between Coinbase Custody and the New York-based Wilshire Phoenix comes after the San Francisco-headquartered cryptocurrency trading platform raised $300 million in equity funding which brought its market valuation up to $8 billion. According to Bill Herrmann, founder and CEO of Wilshire Phoenix, the partnership with the leading U.S. crypto exchange provides his company with the “best in class platform on which to securely store digital assets.”

Bitcoin Cash SMS Wallet Now Available in 33 Countries

The Daily: Coinbase Launches Investment Fund, Cointext Enters New MarketsSMS-based cryptocurrency wallet provider Cointext has entered four new markets. The platform, which allows people who don’t have smartphones or access to the internet to send cryptocurrency using text messages, launched its bitcoin cash (BCH) wallet in Hungary, Slovenia, Taiwan, and Puerto Rico. The company is currently operating in 33 countries after recently adding Brazil, Poland, Croatia, and Romania.

Users can take advantage of the service without installing any apps or setting up accounts. The platform allows individuals to send digital cash to domestic and international mobile phone numbers or BCH addresses. When someone receives cryptocurrency to their phone, Cointext automatically sets up a bitcoin cash wallet for them. Commenting on the expansion, Cointext founder and CTO Vin Armani said:

Cointext is the easiest way to introduce new people to bitcoin … We’re excited to launch in Slovenia because bitcoin cash is already popular there.

The ability to access a wallet via SMS (short message service) means users don’t need internet connection to transfer cryptocurrency. Cointext also settles all transactions without holding customer funds. The company charges $0.02 per byte on all transactions. The flat fee is levied independently of the value of coins being transferred.

New Zealand’s Financial Regulator Blacklists Cryptogain

The Financial Markets Authority of New Zealand, FMA, has issued a warning against three online platforms. According to the watchdog, the trio have the characteristics of scams. Two of them, Russ Horn and Zend Trade, have been luring investors into forex trading schemes offering unrealistic returns. The websites have advertised forex advisory and professional brokerage services, trading software and educational materials. Regulators have found that the two platforms are actually connected.

The Daily: Coinbase Launches Investment Fund, Cointext Enters New MarketsThe third entity, Cryptogain, has been presenting itself as a provider of cryptocurrency trading services. Its website used the name of another, legitimate company registered in New Zealand, Cryptogain Ltd., without consent. In a number of complaints filed with the FMA, the platform is accused of withholding client funds.

The news about the blacklisted company comes after a positive development for the cryptocurrency industry in the island nation. The government of New Zealand recently invested $315,000 into the Auckland-based startup Vimba which maintains a cryptocurrency savings platform and offers a range of trading services. The company will use the funds provided through the government innovation arm Callaghan Innovation to develop new features, build multi-signature wallets and increase the number of supported cryptocurrencies.

What are your thoughts on today’s news tidbits? Tell us in the comments section.


Images courtesy of Shutterstock, Nexo, Bitfinex.


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Tether Confirms New Bank and Claims to Have $1.8 Billion in Cash

Tether Confirms New Bank and Claims to Have $1.8 Billion in Cash

Tether Ltd. has confirmed the identity of its new bank. The company behind the eponymous tether stablecoin (USDT) has historically been reluctant to disclose its banking arrangements, for fear they might be jeopardized. It has now issued a statement, however, confirming that it is banking with Deltec Bank & Trust Ltd.

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Tether Highlights Due Diligence by Deltec

Tether Confirms New Bank and Claims to Have $1.8 Billion in CashThe identity of Tether’s new bank, Bahamas-based Deltec, has been public knowledge for a number of weeks. On Nov. 1, Tether released a statement to confirm its banking relationship with the 72-year-old financial institution. The statement emphasized Deltec and Tether’s commitment to compliance and transparency, in a bid to stave off the sort of criticism that has been leveled against the company.

“The acceptance of Tether Ltd. as a client of Deltec came after their due diligence review,” read the announcement. “This included, notably, an analysis of our compliance processes, policies and procedures; a full background check of the shareholders, ultimate beneficiaries and officers of our company; and assessments of our ability to maintain the USD-peg at any moment and our treasury management policies.”

Tether continued:

This process of due diligence was conducted over a period of several months and garnered positive results, which led to the opening of our bank account with this institution. Deltec reviews our company on an ongoing basis.

One word that was conspicuously absent from Tether’s statement was “audit,” something that a tranche of the cryptocurrency community has been requesting for months. Such an undertaking, should it ever occur, would need to be handled by a specialist third party and is not a duty that Deltec could perform.

Tether Insists Cash Deposits Will Cover All USDT

In addition to confirming its banking relationship, Tether provided a copy of a letter from Deltec dated Nov. 1 stating that its cash on hand stands at $1,831,322,828. If accurate, these holdings would cover the $1.76 billion of USDT in circulation. While some commenters poked fun at the rudimentary nature of the signature on the document, the majority seemed relieved to see prima-facie evidence to suggest that all USDT in circulation are backed by a U.S. dollar.

Tether Confirms New Bank and Claims to Have $1.8 Billion in Cash

What are your thoughts on Tether’s statement? Let us know in the comments section below.


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