This week’s summary of various cryptocurrency news and developments:
Coinbase adds Bitcoin Cash support, investigates potential insider trading
Popular U.S.-based cryptocurrency exchange Coinbase recently added Bitcoin Cash (BCH) to both Coinbase and its Global Digital Asset Exchange (GDAX), which helped the cryptocurrency’s value surge for a brief period of time. The addition initially triggered a trading frenzy, that forced Coinbase to halt BCH trading for a few hours after the price inflated to $9,500 on its exchange, while in general BCH hit an all-time high above $4,000. However, some users noted that the cryptocurrency’s price started surging before Coinbase made its move public, meaning insiders could be trading on move before it occurred.
Very strange accumulation and pump on Bcash in the hours leading up to the @Coinbase BCH add. If I didn't know better, I'd think that was potential insider trading activity. @GDAX 'ed? #bitcoin #bcash #bch pic.twitter.com/leX8ro0MFf
— Whalepool (@whalepool) December 20, 2017
In response to criticism, Coinbase’s CEO Brian Armstrong published a blog post clarifying that the company’s policy prevents employees from “trading on material non-public information,” and that he won’t “hesitate to terminate the employee immediately and take appropriate legal action” if evidence of policy violation is found.
Litecoin creator Charlie Lee sold all his LTC citing a “conflict of interest”
Through an announcement on Reddit, Litecoin (LTC) creator Charlie Lee recently revealed that he has sold all of his Litecoin, after claiming that it was a conflict of interest for him to continue buying and selling the cryptocurrency, while tweeting about it, as he has “so much influence.” Lee didn’t share the exact amount of Litecoins he sold, but did add that he would continue to work on the cryptocurrency as he would still be “rewarded in lots of different ways, just not directly via ownership of coins” if it succeeds. It’s uncommon for a cryptocurrency creator to publicly divest of his holdings, and this led various users to speculate on Lee’s move. Some believe he was selling Litecoin to purchase Bitcoin Cash, while others said they lost faith in the cryptocurrency. One Reddit user stated
- “Typically in finance, a founder selling out his stake is a very BAD indicator for his perception of future performance.”
Cryptocurrency exchange EtherDelta has been hacked
EtherDelta, a decentralized cryptocurrency exchange known for having ICO tokens listed before other platforms, has recently been hacked as attackers managed to hijack its DNS server, enabling them to send users a malicious version of the exchange’s website. In an attempt to warn users, EtherDelta’s Twitter account started shooting out warnings.
1/2 *IMPORTANT* we have reason to believe that there had been malicious attacks that temporarily gained access to @etherdelta DNS server. We are investigating this issue right now – in the meantime please *DONOT* use the current site.
— EtherDelta (@etherdelta) December 20, 2017
A second tweet revealed that the malicious website didn’t have the exchange’s official twitter feed and chat interface, something that could warn users something was off. The attackers managed to collect at least 308 Ether – worth over $250,000 – from the exchange’s users, as well as a number of ERC20 tokens, according to data from the Ethereum blockchain.
To help affected users retrieve their funds without going through the malicious website, a video has been released. At press time the exchange has announced that it’s back online, but users noted that there could still be security concerns.
Belarus legalized cryptocurrency payments and ICOs
The president of Belarus, Alexander Lukashenko, recently signed a decree that makes cryptocurrency payments and ICOs legal in the country, in an attempt to attract foreign investors. The decree exempts revenue profits from all operations using cryptocurrencies until 2023, and established a direct legal link between token issuers and their obligations towards token holders, while adding fraud protection by setting capital requirements for exchange operators. It further introduces smart contracts in the country, and allows local IT companies to partly operate under English law, to help struggling foreign investors navigate Belarus’ legal system. In a statement, the country’s president stated:
- “Belarus will become the first government in the world that opens wide opportunities for the use of blockchain technology (…) We have every chance of becoming a regional center in this area.”
South Korean exchange Youbit filed for bankruptcy after being hacked
A South Korean cryptocurrency exchange, Youbit, has been hacked for 17% of its total assets – over 4,000 BTC – this week. The company behind the exchange, Yaipan, assured users that 83% of the funds were safely stored in a cold wallet and, as such, weren’t touched. This allowed the company to give users a chance to withdraw their funds at 75% of their market price, while promising to repay them back in the future. Notably, this is the second attack Youbit has suffered this year, and this time the company filed for bankruptcy and suspended trading.
North Korean hackers had in the past been linked to Youbit’s first hack, and are chief suspects in this incident as well, due to “telltale signs and historical evidence.” Per CCN, the hackers could’ve been trying to acquire funds for the regime, and the move could spark an international incident as a NATO-sponsored think tank recently issued a statement saying a state-sponsored malware attack can be seen as an act of war.
Bitcoin isn’t a threat, says Bank of England’s chief
According to Reuters, while speaking to British lawmakers in Parliament, Bank of England (BoE) head Mark Carney stated that, despite bitcoin’s meteoric rise this year, it doesn’t pose a threat to global financial stability. The politician further said that the idea of a central bank-issued digital currency that can be used by the public has “fundamental problems” in it, unless the amount people can hold could be restricted. As most public personalities, Carney added that he is interested in blockchain technology, as according to him it has the potential to fundamentally change the banking industry, partly because it could “sharply increase liquidity risks.” Regarding the number one cryptocurrency, he stated:
- “At present, we don’t view [bitcoin] as a financial stability issue.”
Bitcoin’s price corrected after crossing the $20,000 mark
This week Bitcoin, the number one cryptocurrency, managed to cross the $20,000 mark before its price quickly started correcting as much as 40%, to a low of $12,000, before it bounced back and started recovering. At press time, one Bitcoin is currently trading at $15,499 and the cryptocurrency’s market cap is of $258 billion. Its dominance, according to CoinMarketCap, is of 43.7%, as the cryptocurrency ecosystem currently has a market cap of $592 billion.