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Vitalik Buterin Sees Ethereum (ETH) Dominance Fading… And He’s Not The Only One

Vitalik Claims Ethereum Is Losing Its Lead “To Some Extent”

Earlier this week, the one and only Vitalik Buterin sat down with prominent crypto journalist Laura Shin to talk all things Ethereum. In the interview, this being the first live episode of “Unchained,” Buterin was surprisingly candid, letting a few things slip out of his lips that may have caught some on the back foot.

According to BreakerMag, Shin started it out with a toughie: “is Ethereum losing its lead?”

Surprisingly, Buterin conceded, remarking that yes, Ethereum is losing its command over the smart contract blockchain ecosystem “to some extent.” The Russian-Canadian coder chalks this up to his brainchild’s nascency, explaining that as the industry swells, there will naturally be competitors that rear their heads. He adds that time gives projects time to build off their predecessors.

The 26-year-old programming wiz goes on to touch on potential competitors. Polkadot, a yet-to-launch crypto project that raised a purported $100 million+. Buterin explains that he doesn’t see the blockchain replacing his own. Yet, he explains that he wouldn’t be entirely disheartened if the privacy-centric ZCash or even Ethereum Classic were to usurp his project’s own hegemony.

On the other hand, he poked fun at Tron, explaining that if the Justin Sun-run venture manages to take over Ethereum, he ”
will have lost a certain amount of hope for humanity.”

Losing Steam

Buterin isn’t the first to have brought up issues with the narrative that Ethereum will always be the go-to platform for decentralized applications.

Kyle Samani, the co-founder and managing partner of Multicoin Capital, noted that well-funded, high-potential blockchains could eventually pose a threat to Ethereum’s multi-year supremacy. The Multicoin executive noted that Cosmos and the a16z-backed Dfinity, two projects that found their roots in 2017, could take a large piece of the smart contract development and deployment pie.

World-renowned venture capitalist Fred Wilson echoed this thesis. In a blog post, Wilson, the co-founder of Union Square, remarked that “‘next-gen’ smart contract platforms” will begin to ship and challenge the long-standing leader in 2019, especially in terms of its leadership in this “super important area in the crypto sector.”

In a recent Forbes interview, Alex Sunnarborg, a Tetras Capital representative, noted that recent layoffs at Consensus Systems, better known as ConsenSys, should have a negative effect on the broader Ethereum ecosystem.

He added that the fact ConsenSys is an integral part of this subsector and underwent purportedly drastic staff cuts should have some worried. Generalizing DApps and products on the platform, Sunnarborg explained that many promising offerings have yet to launch, and the ones that have are “pretty difficult to use” and have little-to-zero active users.

Case in point, the Tetras capital founding partner drew attention to the mere $40,000 currently staked on Augur, a multi-million dollar ICO. Thus, he claimed:

“There’s this massive disconnect between how much money is still tied up in these projects and how much people actually use them.”

Sunnarborg added that Ethereum may also become pressured by competition blockchains, like Dfinity or Polkadot, along with the fact that the chain’s development is losing momentum and steam.


Photo by James Pond on Unsplash

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Bitfinex’s Bitcoin Markets Could Be Signalling a BTC Rally To $5,000

Bitcoin “Likely” To Break Higher

Over recent weeks, the cryptocurrency market has seemingly began to embark on a slow and steady recovery. While the asset class took a slight tumble on Thursday, with Bitcoin (BTC) falling by 1.33%, cryptocurrencies are still nearing their year-to-date highs. The simple fact has led some crypto analysts to begin touting bullish sentiment, as the technical and fundamentals tides have seemingly begun to turn in BTC’s favor.

Prominent trader Filb Filb joined in with his own optimism recently, issuing a number of charts accentuating his/her belief that digital assets, especially Bitcoin, are poised for a rally.

Filb explained that from a 12-month perspective, when Bitfinex’s BTC long-short (L/S) ratio rose above 1.5, returned to one or below, and then moved back above 1.25, Bitcoin moved by higher by approximately 25% to 50%. On the other hand, when the L/S ratio failed to break 1.25 after a move under one, BTC entered “very bearish territory,” resulting in fresh lows for crypto.

Currently, however, the L/S ratio has reached 1.5, fallen to one, and could potentially rebound to or past 1.25. And with that, Filb remarked that Bitcoin is “likely to break higher based on this metric alone,” drawing a hypothetical trading range of a 25% rally, which would bring BTC up to $5,000 for the first time in mid-November.

$5,000 BTC?

This isn’t the analyst’s first time mentioning $5,000, believe it or not. As reported by Ethereum World News previously, Filb remarked that a number of technical measures have started to turn in Bitcoin’s favor. Filb specifically drew attention to the 12-hour Moving Average Convergence Divergence, which has begun to trend positive above zero. The analyst also touched on Chaikin Money Flow (CMF), which measures buying and selling pressure, which has begun to signal that there is underlying buying pressure in BTC markets.

He adds that over recent days, Bitcoin has begun to test a “macro 14-month resistance” downtrend, and could break into higher lows if it surpasses that level, which would then turn into support. A move above this level, which would push BTC into a “huge void” of volume, meaning that rallies and drawdowns could be accentuated with little-to-zero volume, could indicate that Bitcoin could hit $5,000 by May.

In a recent interview with BlockTV, Filb also expressed hope in regards to the crypto market’s short-term prospects. He explained that why he expects for BTC to “certainly rally” in the near future is due to the Bitcoin block reward reduction, adding that the emission reduction will make miners less incentivized to sell, therefore granting this market with a reason to move higher.

Moreover, he drew attention to the Lightning Network, especially in regards to the recent exposure that Jack Dorsey has given the scaling solution. Filb notes that this is a strong fundamental factor that could push Bitcoin higher.

Title Image Courtesy of Icons8 Team Via Unsplash

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Ethereum Founder Vitalik Could Be Worth $100M+, Crypto Investor Speculates

Vitalik Still Owns $50 Million In Ethereum

Crypto investors are curious folk. Almost every stakeholder wants to know who Satoshi really is. So, it should come as no surprise that some have delved into blockchain data to determine the net worth/asset value of some of this space’s leading figures. Alex Sunnarborg, who heads cryptocurrency hedge fund Tetras Capital, recently divulged a bit about the financial status of Vitalik Buterin, the creator of Ethereum.

In a six-part thread, Sunnarborg did his utmost to analyze the publicly-known wallets of the Russian-Canadian coder. It was explained that per Etherscan, Buterin currently owns the keys to the 24th most valuable Ethereum (not counting ERC tokens) account.

The wallet in question has custody of 350,003 Ether, 0.332% of the asset’s current circulating supply. At current valuations, such a cryptocurrency stash is valued at $50,000,000 by the market — evidently no small sum. 350,003 ETH is drastically less than the 500,000 coins he received during Ethereum’s genesis block, presumably for his work building the blockchain from the ground up.

Sunnarborg speculates that the disparity between the Ether amount Buterin initially received and his current balance is due to a series of cash outs, which were purportedly completed between June 2017 and February 2018. The investor adds that these sales likely netted Vitalik approximately $40 million, which has likely funded Buterin’s little-known living habits.

And with that, Sunnarborg concluded that Buterin’s finances can be broken down as follows: $50 million worth of Ether in primary address, $40 million in fiat reserves, and likely millions worth of Ether, ERC tokens, and project equity.

Long story short, Buterin is doing rather well for himself.

Bone To Pick With Ether?

While Sunnarborg did not divulge his reasoning for issuing the aforementioned thread, some have speculated that he has a bit of a bone to pick with Ethereum. One Twitter user with the moniker “Yanay” asked if this thread was meant to shame Buterin, who has been rather closed about his private life throughout his seven or eight years in the industry. And in the eyes of some, this may be the case.

In a recent Forbes interview, the Tetras Capital representative noted that recent layoffs at Consensus Systems, better known as ConsenSys, should have a negative effect on the broader Ethereum ecosystem.

He added that the fact ConsenSys is an integral part of this subsector and underwent purportedly drastic staff cuts should have some worried. Generalizing DApps and products on the platform, Sunnarborg explained that many promising offerings have yet to launch, and the ones that have are “pretty difficult to use” and have little-to-zero active users.

Case in point, the Tetras capital founding partner drew attention to the mere $40,000 currently staked on Augur, a multi-million dollar ICO. Thus, he claimed:

“There’s this massive disconnect between how much money is still tied up in these projects and how much people actually use them.”

Sunnarborg added that Ethereum may also become pressured by competition blockchains, like Dfinity or Polkadot, along with the fact that the chain’s development is losing momentum and steam.

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Pro-Crypto Lobbying Has Tripled Since 2017. Better Regulations May Boost Trading and Adoption

Cryptocurrency and blockchain technologies are gradually transforming the way society evolves, and although it is difficult to notice, the obvious interest of politicians and large corporations is a powerful indicator of how much the ecosystem is growing.

Despite the enthusiasm of the users and the dynamism in the work of blockchain devs and fintechs in general, it seems that the regulatory bodies do not share this passion. The “don’t fix what’s not broken” philosophy has often caused severe difficulties for those interested in making a global business out of crypto.

However, there are reasons to be optimistic. The increasing number of investors has provoked a substantial boost in the lobbies created to protect and encourage the development of blockchain technologies and the legitimate use and trade of cryptocurrencies.

An Increase in Crypto-Lobbies Could Drive More Favorable Regulations

According to a report published by Politico.com, the US legal system is currently experiencing a “blockchain lobbying boomlet” with a 3x increase compared to last year.

Mr. Jerry Brito. CEO at Coincenter

From a dozen lobbies registered at the end of 2017, the sum rose to 33. Most of these lobbies focus on the development of regulations oriented to improve online trading of digital assets:

“What’s driven a lot of the growth in lobbying recently has been securities regulation,” said Jerry Brito to PI. Mr. Brito is the executive director of the Coin Center, a nonprofit that has been lobbying since 2014, working with important North American politicians such as Reps. Warren Davidson (R-Ohio) and Darren Soto (D-Fla.)

These lawmakers are also members of the Congressional Blockchain Caucus and have issued opinions indicating that the CTFC should regulate cryptocurrencies and associated services instead of the SEC.

Ripple Leads One of The Most Important Lobbies

Brad Garlinghouse Ripple JPMCoin
Brad Garlinghouse. CEO at Ripple

Another of the most important lobbies is the “Securing America’s Internet of Value Coalition” promoted by Ripple hand in hand with other startups. The Lobby, led by the Klein/Johnson Group is looking for the promotion of clear legislation that does not represent a risk or uncertainty for new developers.

Lobbying can be crucial for the expansion of blockchain technologies. However many purists warn about the fact that most of these groups protect their interests instead of those of the community.

Currently, in addition to the work carried out by private law firms, it is important to mention that Mr. Trump’s administration has promoted important modifications among those responsible for making these kinds of decisions. Perhaps the most noteworthy are the substitutions of commissioners within the SEC.

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Crypto Scores Big-Name Backer in Chicago’s Mayor: “Alternative Currencies Will Happen”

Chicago’s Mayor Takes To The Stage To Laud Cryptos

Very often do incumbents of legacy industries mention crypto assets. And even if they do, their comments are often laced with a negative tone, as they are wary of the purported criminal activity-enabling potential of assets like Bitcoin.

But, this narrative took a sudden turn on March 18th, as Rahm Emanuel, Chicago’s incumbent mayor, took to the stage of a local FinTech gathering to make mention of cryptocurrencies and blockchain. Per Forbes, his statements were rather positive.

Emanuel, who formerly served as President Obama’s chief of staff, remarked that for nations facing finanicial imbroglios, namely Iran and Venezuela, harnessing crypto assets could be a good escape mechanism. He went on to explain:

One day, somebody’s going to figure out – whether that’s Argentina, ten years from now, five years from now – how to use cryptocurrencies to stay alive when their facing a financial crisis, and then you’re going to find out that this moment has arrived.”

Emanuel’s comments are rather reminiscent of those made by humans right advocate Alex Gladstein, who wrote an op-ed in TIME Magazine on a similar subject matter. According to reports from this very outlet, Gladstein explained that he sees Bitcoin, privacy-centric digital assets (ZCash, for example), and similar technologies as a way out of authoritarianism.

The mayor of one of America’s biggest cities was open in stating that his knowledge of the technology is lackluster, but explained that he sees blockchain’s “trend lines are affirmative for its future.”

Emanuel Joins Elon Musk, Jack Dorsey, Others In Bitcoin Love

Emanuel’s public show of affection for cryptocurrencies comes after some of the world’s largest Silicon Valley stars, entrepreneurs, and the like have lauded Bitcoin.

As you, the reader, likely know, Jack Dorsey, the chief executive of Twitter and Square, has become somewhat of a BTC crusader in recent months. After adding the cryptocurrency, which he has called a contender for the Internet’s native currency, to Square’s Cash App in early-2018, Dorsey has gone, as CNBC puts it, “all-in” on the space. After confirming that he would add the Lightning Network to Cash App, he scooped up a Trezor hard wallet to store his holdings.

Most recently, he called on three to four developers and one designer to join Square Crypto, a recently-launched division meant to bolster the Bitcoin ecosystem through development and newfangled products.

Nearby, Elon Musk, a world-renowned entrepreneur and visionary of what’s to come, has expressed a similar sentiment on the future of digital assets. Musk told ARK Invest’s CEO that he expects for paper money to be ousted by cryptocurrencies, before adding that he sees Bitcoin’s structure as “brilliant.” The Tesla and SpaceX CEO, however, made it clear that he only owns less than $1,000 worth of BTC.


Photo by Matthew Hamilton on Unsplash

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Key Bitcoin (BTC) Investors Join Hands: Morgan Creek Funds Ikigai

Pomp and Kling Team Up, Look To Bolster Crypto

By and large, 2018 hasn’t been kind to crypto startups. Smaller, little-known exchanges have shuttered operations entirely, while some recognizable names in this budding industry have laid off dozens, if not hundreds of their talents. As reported by Ethereum World News, Bithumb recently joined the list of mainstay industry stakeholders to have laid off employees (50% — 160), citing waning Bitcoin trading activity.

But, two names in this space have excelled over the past 12 months, carving out what scant space there is for themselves in interesting, yet effective ways. These companies are known as Morgan Creek Digital (MCD) and Ikigai Asset Management, and they’re two U.S.-based cryptocurrency-centric funds focused on bolstering adoption and viable applications.

Funnily enough, the MCD and Ikigai decided to join hands on Wednesday, issuing a press release to reveal that they had formally joined hands.

Morgan Creek’s digital asset branch, headed by partners Mark Yusko, Anthony “Pomp” Pompliano, and Jason A Williams, will be anchoring Ikigai’s cryptocurrency hedge fund, which will enlist long-short equity strategies and venture stakes in promising firms. The nominal value of this sum was not divulged.

In a comment, industry commentator Pomp, who has amassed a following of nearly two hundred thousand on Twitter primarily through his catchphrase, “Long Bitcoin, short the bankers,” lauded Ikigai. He expressed his love to the Los Angeles-based firm by stating:

Ikigai has built an impressive platform for understanding the evolution of, and investing in, crypto assets. 

Former Facebook staffer Pompliano then referenced his thought process that cryptocurrencies will be the best-performing, asymmetric asset class in the next decade, adding that Ikigai should be able to “well-positioned to capture” that upside potential.

Morgan Creek’s decision to invest in an industry partner comes after the former secured a $40 million bursary from two Virginian pension funds, an endowment, and other institutions to invest in companies like the yet-to-launch Bakkt, Coinbase, and Harbor.

Bitcoin To Oust Fiat?

So why are MCD and Ikigai joining hands? Well, the simple answer is that the two firms’ founders and leaders are advocates of the theory that BTC and other cryptocurrencies are a viable alternative to fiat, which they deem as antiquated and potentially Ponzi-esque.

In a recent tweet, Kling remarked that when the “books are written about crypto” in the future, when Bitcoin is valued at trillions, the dovish nature of the Federal Reserve will be a “big part of the story.”

The anti-establishment figure is touching on his long-standing thought process that Quantitative Easing — the “most ambitious monetary experiment ever” — will be what kills the macroeconomy.

In an independent newsletter iteration, published on Off The Chain, Pompliano echoed this thought process that government-issued money isn’t sustainable. He cites a tweet from the European Central Bank (ECB), in which one of the entity’s basement overtly states that his overseers have the ability to print money. While Pomp acknowledges that this is common knowledge, he explained the EU fiscal authority’s propensity to make that fact publicly-known draws the ECB’s intentions into question.


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JP Morgan Exec: More Partnership Than Competition Between Banks and Crypto

JP Morgan Cryptocurrency Banks

A JP Morgan Chase executive has put forth an interesting compromise between cryptocurrency and the banking framework–two industries that have long been put at odds.

Speaking in an interview with CNBC’s Squawk Box on Mar. 20, JP Morgan’s Global Head of eCommerce Solutions Ron Karpovich made the claim that there is “more partnership instead of competition” between existing financial establishments and what has often been viewed as a banking disruptive market in cryptocurrency.

Karpovich’s comments for collaboration between the two industries comes just a month after his bank announced the development of the JPM Coin, a blockchain-based stablecoin that will function on J.P. Morgan’s internal payment network for clients. While some analysts at the time made the comparison to the role of XRP in Ripple’s payment protocol, Binance Research subsequently dispelled that notion. Instead, Binance’s team pointed out that JPM Coin will be limited in scope and more than likely only available for the use of JP Morgan clients as opposed to inter-bank operability.

Nonetheless, Karpovich’s comments appear to give an indication of reaching across the aisle, with the executive contending that blockchain-based payments will increase the utility of JP Morgan transfers. However, he also goes on to claim that cryptocurrency innovators and entrepreneurs should avoid shunning the banking industry all together, and that they will have to rely upon banks to move funds.

Karpovich told CNBC,

“Ultimately behind the scenes, they [crypto innovators] are going to have to use a bank to move funds. There’s more partnership instead of competition in that space. When it comes to margins and capabilities — payments is never something that grows in margin, nobody wants to pay for a payment. That’s one of the hardest parts of this process: you have limited resources in the capability to sell, so you need highly efficient and large players.”

The JP Morgan executive stressed the need for more efficient and cost-effective payments as the primary driver for innovation in the space of both banking fintech and blockchain-based cryptocurrencies. However, Karpovich finds blockchain somewhat poised to fade into the back-end of technology, as opposed to achieving mainstream adoption by forward-facing cryptocurrencies.

In the case of the JPM Coin, blockchain makes up a component of the technology that will ultimately be used by clients without them directly engaging in the process, as some believe will propel the adoption of cryptocurrency.

Karpovich also dispelled the idea that JP Morgan had contradicted its stance on crypto with the development of the JPM Coin, particularly given anti-Bitcoin comments from the bank’s CEO Jamie Dimon,

“I think there’s a difference between trading a cryptocurrency that’s in the market that’s ubiquitous versus using the technology to enhance your payments infrastructure. We look at the technology as being a means to doing things faster and cheaper: every CEO would like to make things faster and cheaper. So from that standpoint I think it represents a buy into the concept of using blockchain.”

Overall, Karpovich remains positive on the development of blockchain and blockchain-based payments as a field of interest for banks to develop upon.

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Crypto Analyst: As Bitcoin Staring Down A Barrel, BTC Needs To Break $4,200

Bitcoin Facing Downtrend, Watch $4,200

Per prominent analyst Crypto Rand, Bitcoin (BTC) is entering “do or die” time. In a recent post, Rand drew attention to a “yearly downtrend channel resistance,” which began in April 2018, and has depressed BTC each time it has tried to foray higher.

In July of last year, BTC tried its hand at moving past $8,000 but failed, as the asset encountered this multi-month resistance level. In November, the cryptocurrency plummeted under $6,000, failing to maintain a medium-term, mildly-sloped uptrend and break the downtrend simultaneously. This move, as you likely know, brought BTC to $3,150 and the aggregate value of cryptocurrencies eerily close to $100 billion.

But since that move, things have arguably been on the up and up, as BTC has slowly trended higher to reach $4,000. Although many are calling for a rally to the moon, with analysts expecting for Bitcoin to see a pre-halving run, Rand says that BTC has one final boss to face.

This boss, if you haven’t guessed it already, is the aforementioned channel resistance, which sits at $4,200. Considering historical precedent, if BTC doesn’t break the level this time, the asset could be in for lower lows, potentially falling under $3,000 in a dramatic sell-off.

Rand isn’t the first to have remarked that the coming days and weeks will be of utmost importance for Bitcoin’s ongoing move higher. Trader Crypto Birb posted a chart (seen below) highlighting what he calls a “market decision point,” which will either perpetuate BTC’s rally or send it into a long-term consolidation trend between $1,360 and $3,000.

Analysts Hopeful

While it’s entirely possible for BTC to falter from here, failing to break out of the descending channel downtrend that has plagued this market for months on end, many argue that upside is in crypto’s cards.

In a series of research notes, tweets, and mainstream media appearances, Tom Lee, the co-founder of New York-based advisory outfit Fundstrat, explained that the 200-week moving average could be signalling a Bitcoin breakout in the short-term. Citing other catalysts that could boost this market, the cryptocurrency analyst drew attention to macro trends, like the weakening performance of the U.S. dollar and the expectation that emerging markets will outperform, as a way to give credence to the theory that cryptocurrencies are preparing for liftoff.

Fundamentally, this space’s prospects have seemingly begun to turn positive. Each and every day, news comes out regarding institutional involvement. Case in point, Fidelity Investments just recently launched its Bitcoin-centric custodian, amid a newfound push for institutions to divert funds into this budding space. Rumor has it that a multitude of global banks have begun to harness IBM’s WorldWire blockchain program to offer stablecoins, which only cements the theme that Wall Street is keeping a close eye on this technology.

Adoption has also been hot. Samsung, another South Korean technology giant, was recently revealed to have integrated a product called “Blockchain Keystore” into its Samsung S10 lineup, which launched last month to widespread hype. While a debate rages on about the specifics of the offering, with some claiming that it stores Bitcoin and others noting that it works much like an Ethereum-centric DApp browser, the impact that Keystore will have on adoption has been gauged as monumental.

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Crypto Winter Strikes Again, Leaves Gaping Hole In Bithumb’s Side

Crypto Startup Bithumb Slammed

Since getting hacked in the middle of 2018, Bithumb, South Korea’s largest crypto asset exchange, has been struggling. The so-called crypto winter, which started to bare its fangs late last year, has only exacerbated the startup’s qualms.

Bithumb’s situation purportedly came to a head just recently, with CoinDesk reporting that the company has unveiled plans to cut upwards of half of its staffers. Citing an unnamed executive from the company, which has plans to go live on the New York Stock Exchange through a reverse merger, the 300-man headcount will be cut to 150. It was explained that as the platform’s trading volume has decreased, Bithumb is enlisted “internal measures” to mitigate further economic damage.

A startup representative made it clear that the 160 purged from their roles won’t be left out to dry, however. He/she remarked that Bithumb’s former employees will have access to “assistance and training for job placement,” but wasn’t clear on what the details of said program would entail. It was added that Bithumb will continue to hire staffers for “various new businesses.”

While the South Korean firm has been suffering, the local crypto economy could soon see a revival on a monumental scale. Kakao, a leading social media giant in the region (44 million users in a nation of 51.5 million), is rumored to have plans to unveil a native cryptocurrency wallet for its Talk application, a popular instant messaging platform. This offering, which is purported to come alongside a blockchain platform named “Klaytn,” could spark a second wave of cryptocurrency adoption in the Asian nation, which has embraced blockchain with open arms.

Layoff After Layoff

Even if Bithumb is able to get back on its feet through an uptick in local adoption, it’s been mostly doom and gloom for many global startups.

Mere weeks ago, First Digital Assets Group (FDA), a blockchain application group based in Tel Aviv, was revealed to be dropping most employees from its payroll. As a part of this refresh, FDA will purportedly be totally purging its industry research division, One Alpha. The Israeli upstart will also be putting its K1, Stamina, Titan, and Knox ventures on the backburner, merging a majority of these subsidiaries’ facets with the parent group.

This is just the tip of the layoff iceberg though. ShapeShift laid off 37 staffers, with CEO Erik Voorhees explaining that his firm expanding into alternative opportunities, like KeepKey and CoinCap, too quick. Bitmain was rumored to have cut over 1,000 employees, cutting of a number of its facets and even Jihan Wu to stay afloat. And the NEM Foundation, the organization that heads development of the XEM digital asset, cut 60% of its monthly burn rate, presumably cutting a few dozen of its 150-strong employee base.

Funnily enough, some see these layoffs as mandatory. Travis Kling, the CIO of Ikigai, explained that prior to Bitcoin rallying again, the industry needs more layoffs, exchange collapses, stringent regulation, and cries that “crypto is dead.”


Photo by Mike Kotsch on Unsplash

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Sanctions? What Sanctions? North Korea Finding A Window in Crypto

Even in the face of US and UN imposed sanctions, North Korea is resolute and effective in rendering international embargoes useless. Recent chronicles from the US Panel of Experts now corroborate findings of what cyber experts, foreign relations specialists and other observers that the isolated country have all along been using their formidable cyber prowess to by-pass sanctions and raise money to fund their nuclear operations.

Not only do the country’s operators working in cohort with
the country’s intelligence arm, the Reconnaissance General Bureau, said to be
actively siphoning funds from closed accounts in Europe to bank accounts
throughout Asia via the previously flagged Glocom and the Malaysia-Korea
Partners Group of Companies (MKP). The shell company’s illicit activities
including “ongoing use of overseas
companies and individuals to obfuscate income-generating activities for the
regime of the Democratic People’s Republic of Korea
” have been highlighted
in previous Panel of Expert reports.

However, what is striking is the country’s decision to by-pass financial sanctions via crypto that is causing jitters. Expected to increase not only in frequency and sophistication, it has been authoritatively established that the country has been actively sponsoring hacks on different exchanges and through their cyber activities carried out by elite units of DPRK military, they have amassed an estimated $881 million after infiltrating and stealing funds crypto exchanges. Of this staggering amount, $571 million can be directly linked to the state sponsored hacker group, Lazarus. 

Apparently, Pyongyang is resorting to crypto as a tactic of
circumventing sanctions thanks to the pseudo or anonymous nature of digital
assets that makes it near impossible for internet sleuths to trail losses. It
is after they hack and steal funds that the country through its agents hire
individuals to launder assets via individual wallets or by employing mixing
services in a bid to obtain sanction free USD. Aside from launching attacks on
the Bank of Bangladeshi hack where $81 million were lost and consequently
laundered through multiple bank accounts, remittance services and casino
junkets, most of these funds were from Coincheck when the exchange reported
losses exceeding $500 million.

“Cyberspace is used by the DPRK as an asymmetric means to carry out illicit and undercover operations in the field of cybercrime and sanctions evasion. These operations aim to acquire funds through a variety of measures in order to circumvent the sanctions.”

Even with all evidence suggesting a well-orchestrated and deep-set
activities of the regime bent towards launching attacks on financial platforms
across the world, representatives of the DPKK persistently deny their
involvement in any form of economic espionage or devastating hacks.

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