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Hodler’s Digest, Dec. 24–30: Top Stories, Price Movements, Quotes and FUD of the Week

Bitcoin Private confirmed the secret creation of an additional 2 million coins, and South Korea rules in favor of Bithumb in investor lawsuit.

 

Top Stories This Week

Nvidia Faces Class Action Lawsuit Over Losses After Lower GPU Mining Demand

Graphics processing unit (GPU) producer Nvidia is currently facing a class action lawsuit over losses that the company reported when lower crypto prices lowered demand for GPUs by miners. The Schall law firm announced the lawsuit this week, with the complaint alleging that Nvidia made false and misleading statements to the market. Schall noted that since the GPU producer claimed that drop off in demand for GPU on miners would not negatively affect the business, the lawsuit has merit.

Altcoin Bitcoin Private Team Confirms 2 mln Additional Coins Were Secretly Premined

The development team for altcoin Bitcoin Private (BTCP) has confirmed this week that 2.04 million units of BTCP were created that were never intended to exist on the altcoin’s blockchain. Following a report in late December from a digital asset analytics website that revealed the discrepancy, the BTCP team launched an investigation that eventually found that the extra coins had been mined, but they do not yet know who created the coins and for what reason.

South Korea Rules in Favor of Bithumb After Investor Lawsuit Over $355,000 Hack

South Korean court has ruled in favor of crypto exchange Bithumb in a lawsuit in which an investor had sued the exchange for his loss of around $355,000 in an alleged hack. Ahn Park alleged that he had been the victim of a hack of his Bithumb account on Nov. 20, 2017, which resulted in the aforementioned loss, and cited Bithumb’s lack of security safeguards as befit a financial services firm. However, the court did not find Park’s claims that Bithumb’s activities were similar to that of services offered in the financial sector to be true, and ruled against him.Top Stories This Week

New Indian Governmental Committee Supports Crypto Legalization, Media Reports

Local India media reported this week that a governmental committee has suggested that cryptocurrencies be legalized within the country. An unnamed senior official who reportedly attended the panel’s meetings on cryptocurrencies stated that there was a “general consensus that cryptocurrency cannot be dismissed as completely illegal. It needs to be legalized with strong riders.” The government reportedly set up this panel after the Reserve Bank of India’s ban on banks dealing with crypto businesses and persons in April this year.

Major US Magazine Time Column Reports on the Freeing Potential of Bitcoin

Time magazine published a column this week that praised the liberating potential of Bitcoin, mentioning Venezuela as an example of a country where the citizens can benefit from the cryptocurrency. According to the article, Bitcoin is a valuable financial tool for avoiding censorship, specifically noting that Bitcoin can help Venezuelans avoid inflation, as a government cannot simply print more Bitcoin. The currency can also be used to bypass mass surveillance in places like China.

Winners and Losers

The crypto markets are looking steady today, with Bitcoin trading around $3,874.67, Ripple around $0.37 and Ethereum at $138.85. Total market cap is around $130 billion.

The top three altcoin gainers of the week are SoundDAC, Bitspace and HondaisCoin. The top three altcoin losers of the week are RabbitCoin, Accelerator Network and CatoCoin.

Winners and Losers

For more info on crypto prices, make sure to read Cointelegraph’s market analysis.

Most Memorable Quotations

“Block-chain [sic] technology. No joke. Super powerful stuff, and the first one to figure out how to hack it, manipulate it or bring it down wins.” — Andrew Bustamante, reportedly a former CIA intelligence officer, speaking of the biggest threats to national security

Most Memorable Quotations

“Once there are new issues, then Ether will rebound aggressively. When the ICO market returns, Ether will quickly test $200. The timing of the ICO rebirth is 12 to 18 months out,” — Arthur Hayes, BitMEX CEO

“Yeah no, I have my disagreements with the bitcoin roadmap, PoW, etc but they’re trying to do something that’s genuinely cool tech. BSV is a pure dumpster fire,”  — Vitalik Buterin, Ethereum (ETH) co-founder

“At some point, yes, it will drive a profound shift in how we communicate and collaborate, but we’re not there yet,”  — Lance Braunstein, E*Trade Financial Corp. CIO, speaking about “blockchain” as a buzzword

FUD of the Week

Hackers Steal Almost 1 Million in Phishing Attack on Electrum Wallet

A hack that reportedly took place this week against cryptocurrency wallet Electrum allowed a malicious party to steal almost 250 Bitcoin (BTC), commentators on social media reported. The hack was then confirmed by Electrum, which explained that it consisted of the creation of a fake version of the wallet that fooled users into providing password information. Affected users reported on social media that they failed to log onto their wallets after providing two-factor authentication code, which Electrum does not actually request during login.

WSJ: Hundreds of Crypto Projects Show Signs of Fraudulent Activity

Research published by the Wall Street Journal this week has revealed that hundreds of crypto offerings show signs of fraudulent activity, improbable returns and plagiarism. For its research, the WSJ downloaded the whitepapers of 3,291 crypto projects that had announced initial coin offerings (ICO), conducting an analysis of the documents. The research found that 16 percent — or 513 — of the aforementioned white papers showed signs of plagiarism and identity theft, and that 2,000 contained sentences with turns like “nothing to lose, guaranteed profit, return on investment, highest return, high return, funds profit, no risk and little risk.”

FUD of the Week

Chinese Media Reports Jihan Wu and Jenke Group to Set Down as Bitmain CEOs

Unconfirmed media reports in China this week wrote that Jihan Wu and the Jenke Group will be reportedly soon retire as CEOs of leading mining ASIC producer Bitmain. According to unnamed sources, Bitmain is currently in a transition period, and employees are allegedly unhappy with the outcomes of the double-CEO system. The Chinese local media outlet also noted that their successor has the surname of Wang, without providing further information.

Japanese Giant GMO Internet to Stop BTC Miner Production After Losses in Q4

Japanese internet giant GMO Internet Group announced its intentions to leave the Bitcoin mining hardware sector. Citing major losses in Q4 of this year, GMO, which began its foray into BTC mining in 2017, has written in a public document that it will no longer develop, manufacture or sell miners, citing difficulties in the current business environment. The document also noted that GMO will relocate its mining operation “to a region that will allow us to secure cleaner and less expensive power supply.”

Best Cointelegraph Features

From Blanket Ban to Its Own Stablecoin: How Facebook’s Relationship With Crypto Changed Over 2018

Facebook often made the news this year in the FUD sense, as it banned, and then partially unbanned, advertising from cryptocurrency-related companies. In response to the rumors that the social media giant would be creating its own cryptocurrency, Cointelegraph looks at the history of how Facebook has interacted with crypto this year.

From “Obsolete” Blockchain to Bitcoin at $1 Mln: Predictions of 2018

As the year comes to a close, Cointelegraph looks at different predictions made this year about crypto, from the very accurate to the wildly off. As Bitcoin drops below $4,000 at year’s end, who was right?

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Korean Court Acquits Crypto Exchange Bithumb After Investor Filed Lawsuit Over $355K Hack

A South Korean judge has ruled in favor of Bithumb after an investor had sued the firm over his loss of around $355,000 in an alleged hack.

South Korean crypto exchange Bithumb has won a lawsuit in which an investor had sued the company for his loss of around $355,000 in an alleged hack. Local financial newspaper The Korea Economic Daily reported on the outcome on Dec. 24.

According to the report, the investor — 30 year old civil servant Ahn Park — alleged he had been the victim of a hack of his Bithumb account on Nov. 30, 2017, which resulted in a loss of 400 million Korean won, or around $355,000.

Within hours of making his won deposit, Mr. Park alleged an unidentified hacker had compromised his account and exchanged the fiat for Ethereum (ETH). That same day, in four separate transactions, the cryptocurrency was then alleged to have been transferred out of his wallet, reportedly leaving the investor with ETH worth just 121 won (around 11 cents).

At the heart of Park’s case was reportedly the claim that Bithumb had failed to offer security safeguards that are adequate to its responsibilities as a purported “financial services” company. He argued that Bithumb’s activities as a crypto exchange are similar in kind to services offered in the financial sector, and should thus fall subject to the security requirements that apply to electronic commerce transaction brokers.

The judge however, ruled against this argument, stating that:

“In general, virtual currencies cannot be used to buy goods and it is difficult to guarantee their exchange for cash because their value is very volatile. [Cryptocurrencies] are mainly used for speculative means, [and it] is not reasonable to apply [Korea’s] Electronic Financial Transactions Act to a defendant who brokers virtual currency transactions without the permission of [South Korean regulator] the Financial Services Commission.”

As previously reported, Bithumb suffered a high-profile hack this June, in which around $30 million worth of eleven various cryptocurrencies were estimated to have been stolen; the exchange soon stemmed the damage with the assistance of industry counterparts, reducing the figure to $17 million.

In October, Hong Kong-based crypto exchange service Changelly revealed it had helped Bithumb to recover 1,063,500 Ripple (XRP) of the assets stolen in June, reportedly worth about $585,000 at the time of the hack.

Earlier this month, Bithumb was prompted to deny allegations of artificially inflating its trade volumes, after crypto exchange ratings and analytics service CER had accused the platform of using wash-trading to fake to 94 percent of its trade volume as of late summer 2018.

As of press time, Bithumb does not feature in CoinMarketCap (CMC)’s rankings for crypto exchanges by adjusted volume, but comes top in CMC’s separate rankings based on self-reported statistics, claiming $1,617,305,865 in traded volume over the 24 hours before press time.

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7 Major Exchanges Join Forces to Enhance the Cryto Ecosystem in South Korea

South Korea took another giant step forward in regulating cryptocurrencies as seven major exchanges have joined forces to enhance the cryptocurrency ecosystem in the country. According to local media, representatives of the seven major exchanges met at a parliamentary policy debate on cryptocurrencies that was held this past Monday. The representatives signed an ‘Agreement for the creation of a sound cryptocurrency ecosystem’.

The agreement included joint measures such as information sharing, real-time monitoring of abnormal transactions in a bid to prevent cyber crime as well as protect investors. The seven cryptocurrency exchanges that agreed to the new measures are as follows.

  1. Upbit
  2. Bithumb
  3. Korbit
  4. Coinone
  5. Gopax
  6. Coinplug (Cpdax)
  7. Hanbitco

The exchanges are also to establish a consultation system that will prevent money laundering, enhance KYC procedures and introduce some restrictions for transactions belonging to unverified users.

One industry official is quoted as calling it a close cooperation system:

With this agreement, exchanges can establish a close cooperation system and improve their image for investors, but in fact, there is no special penalty for failing to comply.

Lee Seok-Woo, president of Dunamu Inc., which handles all operations relating to the Upbit exchange, had stated a while back, that AML/KYC (anti-money laundering / know-your-customer) procedures were mandatory for every exchange that wished to operate in the country.

If you [crypto exchange] cannot meet the standard after a six-month or one-year grace period, you should close it.

South Korea On Track To Regulate Cryptocurrencies and ICOs

Back in June this year, regulatory officials from South Korea had stated that crypto exchanges would soon be regulated in the same way they regulate banks. The regulation shall be carried out by the Korea Financial Intelligence Unit (KFIU) in collaboration with other local financial regulators. With respect to ICOs, the country had promised to issue regulatory direction as soon as legislation was ready.

Kwon Dae-young, Head of the Financial Innovation Bureau at the Financial Services Commission (FSC), further explained the steps the country is taking towards regulating the ICO and cryptocurrency industry.

We are trying to institutionalize cryptocurrency exchanges, but before we do, we have to answer the question of how to deal with the damage and tears of many virtual currency investors.

We must see if any of the projects that can help the people in their daily lives have been presented. Trust and authenticity are important.

What are your thoughts on the seven cryptocurrency exchanges joining forces to better enhance the cryptocurrency trading ecosystem in South Korea? Please let us know in the comment section below. 

[Image courtesy of Bitcoinist.com]

The post 7 Major Exchanges Join Forces to Enhance the Cryto Ecosystem in South Korea appeared first on Ethereum World News.

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South Korean National Assembly Holds Regulation Debate With Local Crypto Exchanges

Major Korean crypto exchanges have arranged a crypto regulation debate in the National Assembly, discussing Anti-Money Laundering policies and customer protection.

South Korea’s representative body, the National Assembly, has held a crypto regulation debate arranged by major local cryptocurrency exchanges, IT media oulet ZdNet Korea reports Monday, Dec. 10.

According to local business outlet Financial Leaders, the topics of the debate were proposed by seven crypto exchanges — Bithumb, CobitCoin, Coinone, Upbit, Gopax, Coinplug and Hanbitco.

The debate was attended both by crypto entrepreneurs and politicians, such as Democratic Party member Kim Byung-wook and representatives for the Liberty Korea and Bareunmirae parties, both with a significant number of seats in the National Assembly. The country’s financial watchdog, the Financial Services Commission (FSC), also sent a representative to the discussion.

ZDNet reports that Lee Seok-wu, CEO of Dunamu — a subsidiary of Kakao that operates Upbit — led a discussion that was attended by FSC members and the president of Gopax, among others. The discussion reportedly focused on Anti-Money Laundering (AML), customer protection and Know Your Customer (KYC) practices..

The debate in the National Assembly was preceded by the FSC’s decision to allow banks to service crypto exchanges, as soon as they have adequate AML safeguards and apply KYC checks.

At the same time, South Korea has a strict policy against Initial Coin Offerings (ICOs), issuing strong warnings against them back in 2017. However, local blockchain startup, Presto, is reportedly going to file a constitutional appeal over this policy.

According to a recent report prepared by CryptoCompare, the crypto industry in South Korea is consistently growing. In November Korean crypto exchanges overtook Maltese competitors by average daily trade volume. As per report, major Korean players produced over $1.4 billion daily.

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Why Bitcoin Dropped by Over 10 Percent, Deleting $40 Billion From Crypto Market, Experts Explain

Four experts speak to Cointelegraph about the 13 percent drop of Bitcoin, evaluating market slump.

Over the past two days, the valuation of the cryptocurrency market has plunged to $201 billion as Bitcoin lost 13 percent, moving closer to its yearly low at $192 billion.

Since Sept. 6 when the price of Bitcoin dropped by more than 10 percent within a one-hour period, the cryptocurrency market has been on a continuous decline. Tokens bled out more intensely than they previously did in April and June, losing out 10 to 30 percent against Bitcoin.

Source: coin360.io

Cointelegraph interviewed ThinkMarkets chief market analyst and former Bank of America trader Naeem Aslam, eToro senior market analyst Mati Greenspan, and well recognized cryptocurrency technical analyst Uzi, delving into the recent drop of Bitcoin and the rest of the cryptocurrency market.

$40 billion drop: One of the biggest daily decline in recent years

On Sept. 6, the cryptocurrency market lost nearly $40 billion from its valuation in less than 24 hours, demonstrating one of the steepest declines in the past three years.

Source: CoinMarketCap.com

In mid August, the cryptocurrency market dropped to its yearly low at $192 billion, but it took seven days from Aug. 7 to Aug. 14 to record such a large drop in valuation.

Prior to Wednesday, throughout the month of August, Bitcoin showed its highest level of stability since June of 2017, as researchers at Diar noted. From Aug. 8 to Aug. 26, the price of Bitcoin remained relatively stable in the $6,000 region, before initiating an overdue corrective rally above the $7,000 resistance level.

Source: CoinMarketCap.com

But, a rushed rally from the $7,000 mark to $7,400 within a four day period led sell pressure to build up, allowing bears in the cryptocurrency exchange market to take over, leading Bitcoin to fall by a large margin.

In late August, ShapeShift CEO Erik Voorhees said that the bear market is not over yet, but the low price range of major cryptocurrencies present a viable opportunity for new investors to come into the market.

The daily chart of Bitcoin demonstrates four similar movements since February. In the past six months, Bitcoin has risen to $10,000, fell to $6,000, recovered to $10,000, and tested the $6,000 resistance level on four occasions.

In February, Bitcoin surged to $11,000 but fell back down to $6,000. In April, Bitcoin rose to $10,000 and dropped to $6,000. In July, Bitcoin rallied to $8,500, only to test the $6,000 resistance level a month later. In September, the same pattern occurs, with each peak on the upside eventually declining $6,000.

Caption: One-day Bitcoin price chart from Cryptowat.ch

If Bitcoin recovers from the $6,000 support level, the next short-term rally could send Bitcoin to $7,000, which may fall back to the $6,000 region. But, if the dominant cryptocurrency can successfully bottom out in the $6,000 region, a possibility for a proper mid-term rally with newly found momentum could emerge.

Factors behind the drop

Speaking to Cointelegraph, ThinkMarkets chief market analyst Naeem Aslam said that speculators have unnecessarily intensified the downtrend of Bitcoin by overselling Bitcoin in the global exchange market.

Aslam emphasized that the downward trend of Bitcoin has not changed since December of 2017, when the cryptocurrency market achieved a $900 billion valuation and initiated a rapid decline:

“Speculators have gone crazy and they are trying to squeeze as much blood out of this trade as they can. Bitcoin hasn’t changed what it was since last December, so what is the panic?”

Aslam added that it is difficult to pinpoint specific factors that have led the price of Bitcoin to drop substantially in recent months.

Analysts and investors in the cryptocurrency market and the broader financial market often attempt to find correlation in cryptocurrency price movements to developments in the cryptocurrency and blockchain sector.

However, correlation is not equivalent to causation, and because an event occurs at a certain time in which cryptocurrency prices fall or surge by a large margin, it does not necessarily mean that the event triggered a big movement in the cryptocurrency market.

TABB Group, an international research company, reported in July that the over-the-counter (OTC) Bitcoin is at least two to three times larger than the cryptocurrency exchange market.

Under the assumption that the OTC market is in fact two to three times bigger than the exchange market of crypto, developments in the cryptocurrency sector should have minimal impact on the price movements of cryptocurrencies — at least in the short-term — as the exchange market depends on the larger OTC market.

Reports have suggested that the correction of Bitcoin initiated on Wednesday was mainly caused by the delay in the decision of Goldman Sachs to launch a Bitcoin trading desk.

It is far-fetching to claim that the decision of a major investment bank to pivot from offering Bitcoin trading services — which may not appeal to its consumer base of institutions and large-scale corporations — to cryptocurrency custodian services led the price of Bitcoin to plunge within an hour.

Rather, it is more likely that the continuous build up of sell pressure on Bitcoin and other major cryptocurrencies since December of 2017 created instability and volatility in the market, causing the valuation of the market to drop.

Because the volume of Bitcoin remains relatively low in comparison to traditional assets and stores of value like gold, it is easier to trigger a domino effect across leading cryptocurrency exchanges.

Goldman Sachs delaying Bitcoin trading desk not relevant

On Sept. 6, Cointelegraph reported that Goldman Sachs has delayed the formal launch of its Bitcoin trading desk that is structured to facilitate rising demand from retail traders and individual investors.

Goldman Sachs spokesperson Michael DuVally told Reuters that the bank has not been able to reach consensus on the roadmap of its digital asset venture, citing various regulatory issues that currently exist in United States markets.

Hours after the statement of DuVally was released, Martin Chavez, the chief financial officer at Goldman Sachs, personally refuted reports that the institution is pivoting away from forming a Bitcoin trading desk operation, characterizing reports around it as “fake news.”

Aslam stated that it is premature to attribute the market’s struggle throughout this week to the delay in the launch of the Bitcoin trading desk operation by Goldman Sachs, as the bank has not closed its operation but merely delayed it to focus on a more urgent initiative that is cryptocurrency custodianship:

“Goldman has only delayed the process, they still have invested a lot of money and talent in this area. Investors must know it is very normal for banks to delay the IPO process if the market conditions are not favorable and over here we are talking about starting something completely new. Goldman has its fingers in many of the areas when it comes to Bitcoin, so stop thinking about it and focus on the price.”

Currently, the cryptocurrency market has a wide range of regulated exchanges in the likes of Coinbase, Gemini, and UPbit that can be used by retail traders to invest in the cryptocurrency market. However, it lacks trusted custodianship and solutions that can break the barrier between cryptocurrencies and institutions.

It can be argued that Goldman Sachs is working on a more urgent issue that needs to be addressed in order to convince the broader financial market and governments to acknowledge cryptocurrencies as an emerging asset class.

As such, while the Goldman Sachs announcement contributed to the fall of the market, as cryptocurrency technical analyst Uzi told Cointelegraph, it is difficult to acknowledge Goldman Sachs as the sole cause for the correction. Bitcoin was already facing resistance around $7,400, the peak it achieved last week before sliding downwards:

“I feel the Goldman Sachs news about them rolling back plans on their crypto trading desk definitely helped trigger the Bitcoin drop, we were facing some tough resistance around $7,400 as well, but it’s not the biggest secret in the world that a massive amount of BTC shorts was added on Bitfinex days before this drop. 10K BTC in shorts, I believe — follow the money, as they say.”

Same bear trend since February

Mati Greenspan, a senior analyst at eToro, one of the largest multi-asset trading platforms in the global finance sector, with eight million active users, echoed the sentiment of Aslam by stating that the cryptocurrency market has been in a similar trend over the last few months, unable to break out of the $8,000 resistance level with solid volume and momentum:

“Volatility in the crypto markets has picked up over the last few days but is still pretty normal for this market. As far as Bitcoin’s price is concerned, the price has been in a rather stable range between $5,000 and $8,000 for the last few months and this hasn’t changed.”

Greenspan added that the volatility in the market can be attributed to the lack of demand from traders in the cryptocurrency sector, rather than specific events which analysts have pinpointed as the primary cause of the recent correction.

“Several possible reasons for the drop could be a few bad rumors that are circulating in the press, along with a stronger dollar and weakness in tech stocks. Ultimately though, it’s simply a matter of more supply and less demand in short-term trading.”

Technical analyst says Bitcoin market is illiquid, fake volumes

Bitcoin is not considered a sufficiently liquid market, especially considering the fact that its exchange market is open to any individual investor and retail trader in the global market. While cryptocurrency market data providers estimate the daily volume of Bitcoin to be around $5 billion, studies have shown that most major cryptocurrency exchanges inflate their volumes through wash trading.

Alex Kruger, an economist and a cryptocurrency trader, stated earlier this week that Bithumb, South Korea’s second largest cryptocurrency exchange behind Kakao-run UPbit, said that more than $250 million worth of fake volume was created since Aug. 25.

He explained that one group of traders has been taking advantage of Bithumb’s 120 percent trading fee payback, which can generate about $90,000 in net income, with a $250 million daily trading volume.

“There currently are $250 million [in] fake volume traded at [the] Korean crypto exchange Bithumb, every day at 11 a.m. Korean Time, since Aug. 25. Bithumb offers 120 percent payback of trading fees as an airdrop. Trading fees are 0.15 percent taker. To collect the full KRW 1 billion rebate, a wash trader must thus trade KRW 278 billion. That is $250 million in daily fake volume. Notice how 31K Bitcoin are traded at exactly 11 a.m.”

Directly or indirectly, the method utilized by Bithumb has incentivized wash trading that bumps up the daily trading volume of the cryptocurrency exchange. The end outcome is a daily net income of $90,000 for a group of traders and a significant increase in the daily trading volume of Bithumb.

However, while the method leads to a win-win situation for both parties, it affects the global cryptocurrency exchange market in a negative way — as it reduces the authenticity of the international trading volume of cryptocurrencies.

Uzi stated that liquidity and fake volumes are two problems that cryptocurrency exchanges will have to address urgently, to ensure that investors in the market are protected and governments can recognize the sector as a legitimate industry:

“Solving the liquidity issue is one that needs to be tackled, and the issue of fake volume is something that needs to be addressed on a larger scale, because there are definitely questionable volumes on major exchanges.”

Uzi also noted that the Bitcoin market is still generally illiquid, given the lack of activity from institutions and large-scale hedge funds in the sector. He stated that the market is still not ready to support big demand from institutional investors, and most short or long contracts around Bitcoin filed through the U.S. futures market or cryptocurrency exchanges are done by individual investors.

“I have always felt the market for Bitcoin is still illiquid, and especially if you look at the altcoins market. I don’t feel any professional institution would take up a short position at that time on Bitcoin just out of the sheer volatility and the momentum it had testing a decent resistance, as well as the massive short being opened that was noticeable to most, it would be terrible risk management.”

Where the market goes next with Coinbase ETF variable

As Cointelegraph reported on Sept. 7, the world’s largest asset manager BlackRock, which oversees $6.317 trillion in assets, and Coinbase, the cryptocurrency sector’s biggest exchange and brokerage, are in talks to develop a cryptocurrency-based exchange-traded fund (ETF) to bolster market activity and facilitate growing demand from institutions for cryptocurrencies.

The entrance of VanEck and the Chicago Board Options Exchange (CBOE) has already increased the probability of the approval of the first Bitcoin ETF by the U.S. Securities and Exchange Commission (SEC). The involvement of BlackRock will create more competition in the Bitcoin ETF space among U.S.-based regulated financial institutions, which may lead to more contenders filing with the SEC to improve the liquidity of the dominant cryptocurrency.

Variables like Bakkt, the Coinbase-BlackRock ETF and positive regulation-related developments in Japan and South Korea could contribute to the recovery of the cryptocurrency in the short-term, which previous corrections in 2012, 2014, and 2016 did not have.

Experts generally agree that the correction of the cryptocurrency market on Sept. 6 was caused by increasing sell pressure and a culmination of various developments, rather than a single event like the Goldman Sachs Bitcoin trading desk announcement having an immense impact on a global market.

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South Korean Cryptocurrency Exchange Giant ‘Bithumb’ Reopens User Registration Feature

Bithumb has resumed registering new users, more than two months after suffering a hack. The South Korea based platform experienced a massive spike in trading volume following the announcement. Some experts believe the user registration resumption by the platform contributed to the recent Bitcoin price increase.

Back to Normal Cryptocurrency Trading Operations

According to a local South Korean news media platform, Yonhap News, Bithumb has reopened the registration feature for the new users. The move comes after an agreement between Bithumb and Nonghyup Bank – the platform’s banking partner, to resume providing banking services to the platform.

In the aftermath of the June 2018 hack, the bank had discontinued its partnership with Bithumb owing to perceived lack of compliance on the part of the exchange platform to customer protection protocols. The South Korean government has taken several steps to eliminate anonymous cryptocurrency trading. Thus, virtual currency exchange platforms must run virtual accounts for their users tied to their real-name bank accounts.

Bithumb Trading Volume Experiences Massive Spike

News of the resumption of user registration on the platform has catapulted Bithumb’s daily trading volume. Previously Bithumb had fallen from its top 10 status to languish further down the pecking order of virtual currency exchangers. Less than a week ago, Bithumb was ranked 19th by Coinmarketcap with a daily trading volume of $60 million.

As at press time, Bithumb is back to the top-ten zone and is currently occupies the 5th position on the log. The platform’s daily trading volume has also surged to $350 million.

The June 2018 Bithumb Hack

In June 2018, Bithumb suffered a hack that resulted in the theft of $30 million. The incident occurred less than a fortnight after Coinrail; another South Korea-based platform was hacked. A few days after the hack, Bithumb announced that it had recovered about $14 million worth of the stolen cryptocurrency.

In the aftermath of the hack, the platform hurriedly tried to clear its hot wallet to prevent further disaster. In doing so, the platform allegedly put pressure on the market causing BTC transaction fees to increase by 400 percent in less than 24 hours.

Do you think cryptocurrency can eradicate the corruption that has become endemic in Football? Let us know your thoughts in the comment section below.

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Fifth Largest Crypto Exchange Bithumb to Reopen Account Registrations, Media Report

Bithumb, one of the largest South Korean cryptocurrency exchanges, will open up account registrations after a month-long freeze, local media outlet Yonhap News reports Wednesday, August 29.

According to a spokesperson from banking partner Nonghyup Bank, Bithumb will meet specific requirements as dictated by South Korean law in return for regaining banking support.

Nonghyup had previously suspended its services for Bithumb at the end of July, rumors at the time suggesting the decision had come after the exchange lost $17 million in its most recent hack a month previously.

“We decided to keep the investor assets separate, and we will not accept interest or deposits,” the spokesperson said.

In January, South Korea introduced wide-ranging rules for cryptocurrency exchanges, which included banning foreign citizens and ensuring all traders linked their accounts to their ‘real name’ bank account.

Bithumb has had a chequered history, with several hacks piling pressure on executives to ensure compliance.

With the fresh agreement due to come into force August 30 meanwhile, markets have already begun reacting.

Trade volumes on Bithumb, which had tanked following the banking problems, have increased precipitously in the past 24 hours, BTC/KRW posting gains of almost 70 percent versus August 27-28.

Bithumb is currently ranked fifth largest crypto exchange in the world by daily trading volumes, seeing about $362.4 million in trades over the past 24 hours.

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Korean Crypto Exchange Bithumb to Restart User Registrations

Bithumb, one of the largest cryptocurrency exchanges in South Korea, is reportedly renewing its contract with the country’s Nonghyup Bank – a move that will allow the firm to once more accept new account registrations.

Korean news agency Yonhap reports on Wednesday that Bithumb and Nonghyup are planning to sign the contract on Aug. 30 in order to allow the exchange to assign new so-called real-name virtual accounts to cryptocurrency traders.

As previously reported by CoinDesk, Bithumb announced the suspension of its new account registration service on July 31, putting it down to a “service improvement process.” Reports at the time suggested the halt was forced upon the exchange because the bank was insisting on changes following the exchange’s $31 million hack in June.

Currently, banks in South Korea can provide account services for crypto exchanges to deposit users’ assets on their behalf. However, each virtual account dedicated to a specific user within the exchange’s deposit account must be paired with the user’s verified identity so that banks can monitor the flow of the funds for anti-money laundering purposes.

Under the country’s regulations, users’ accounts must also be separated from company accounts that, for instance, store an exchange’s own operating funds.

Following the July suspension note, 24-hour trading volume on Bithumb took a hit and dropped by 40 percent within just three days, from around $350 million on July 31 to $200 million on Aug. 3.

Daily trading volume further declined to around $71.7 million by Aug. 23, but had rebounded to over $344 million at press time, data from CoinMarketCap shows.

Bithumb image via CoinDesk

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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S. Korea's Top Crypto Exchange Upbit Defies Bear Market, Posts $100 Million Profits in Q3 2018

South Korea’s largest crypto exchange, Upbit —  a crypto-only platform run by a subsidiary of Korean tech giant Kakao —  has posted a $100 million profit in the third quarter (Q3) of 2018, Yonhap News reported August 23.

As Yonhap reports, Kakao’s recent Semiannual Report indicates that the net profit of Upbit operator Dunamoo was 19,330 million won ($17.35 million), with total assets adding up to around 1.25 trillion won (around $1.1 billion). Last year, the company posted a net income of 190.31 billion won ($170 million), while its total assets were at 1.257 trillion won (around $1.1 billion).

Dunamoo also runs KakaoStock, the most popular stock brokerage application and index in South Korea, yet according to Yonhap, the lion’s share of the net profit is reportedly from Upbit.

Yonhap further cites data from the Repository of Korea’s Corporate Filings (DART) that shows that by comparison, Korea’s second-largest exchange, Bithumb, posted around $35 million in profit over the same time period.

As Yonhap notes, Bithumb is currently expected to post less than 20 percent of its 2017 net profit, which was reportedly officially around $400 million.

While both exchanges have been hit by the global crypto bear market, Bithumb also notably suffered a security breach in June that resulted in the theft of around $17 million worth of crypto, which it has since pledged to reimburse from corporate funds. Bithumb moreover suspended its services in the wake of the high-profile incident, only resuming them earlier this month.

Reports this March revealed that Kakao and its subsidiaries — which are said to have over 90 percent market penetration in their respective markets across fintech, taxi services, messaging, and social media — would be focusing on integrating cryptocurrencies for their 12,000 merchants and over 100 million users. Kakaopay has notably been interoperable with Upbit as of the latter’s launch in October 2017.

This May, Upbit came under scrutiny from local law enforcement and financial regulators on suspicion that officials had faked balance sheets. The results of an internal audit were officially released earlier this month, effectively vindicating the exchange of any wrongdoing.

Important positive news for the domestic cryptosphere has been forthcoming from the Korean government as of spring 2018, most notably the country’s plans to lift its notorious blanket ban on Initial Coin Offerings (ICOs), alongside a recent move to draft major new industry classification standards for the blockchain industry that would legitimate the emerging sector.

As of press time, Upbit is seeing $95,349,355 in daily trade volumes and is ranked 12th largest globally on CoinMarketCap.