The Bank for International Settlements has expressed concerns over the expected disruption as big tech firms like Facebook enter the financial space.
In 2019, centralized exchanges and individual hodlers are losing record-breaking sums of digital money to hackers and scammers.
Much of digital assets’ appeal stems from the fact that many of them are not affiliated with or controlled by governments, central banks or transnational corporations (at least, not yet). The price paid for the independence from institutions of global capitalism, though, might sometimes be extremely high, as, in the event of cryptocurrency theft, there is no one to appeal to for recourse. Further still, the irreversible nature of blockchain transactions renders it extremely difficult to get the money back once its gone.
The villains of the internet love cryptocurrencies for the same reasons. In the last few years, marked by the spike of popularity for digital money, hackers and scammers of all sorts have perfected the art of pilfering it from unwitting users, many of whom are newcomers to the space.
Roughly a year ago, Cointelegraph had already compiled a lengthy overview of many popular crypto-stealing tricks and tips on how to avoid falling prey to them. While the list remains relevant as ever, the time has come to revisit the subject to see if there are new threats to your crypto assets to beware of.
A recent report by cryptocurrency intelligence firm CipherTrace estimated losses from digital currency theft and scams in the first quarter of 2019 at $356 million, with additional fraud or misappropriated fund losses amounting to $851 million in the same period. Alarmingly, this Q1 total of $1.2 billion constituted 70% of the total losses to crypto crime in all of 2018, indicating intensified hacking activity in the first months of 2019.
At the same time, a study conducted by a security company Positive Technologies registers a change in the structure of attacks. The share of cryptojacking — or, hidden cryptocurrency mining — in the overall volume of cyberattacks seems to be declining: Having reached a peak in early 2018, this type of criminal activity dropped to just 7% in the first quarter of 2019. The analysts noted, however, that the observed trend merely reflects the way malware previously used primarily for cryptojacking has become smarter and more versatile. If the virus recognizes that the machine it took over lacks processing power, it may divert to other modes of operation, such as clipboard jacking.
Researchers at Positive Technologies predicted an increase in the overall number of attacks in the second quarter of the year. Their report pointed out malware and social engineering as attackers’ most widely used tactics and recorded the increasing prominence of ransomware attacks. These findings are further corroborated by ransomware recovery company Coveware, whose analysis revealed a 89% increase in an average ransom from the fourth quarter of 2018 to the first quarter of 2019.
Although perpetrators of ransomware attacks demand payments in cryptocurrency, nearly always, this type of criminal activity is not specific to the crypto sphere, targeting companies from a wide range of industries. This type of intrusion entails infecting the victim’s device with a piece of code that denies the owner access to their system or data, and demanding payment to regain access. Since these attacks usually prey on fairly large corporate entities, we will skip over to those that seek to part individual crypto investors with their digital funds.
Malware or social engineering?
One intuitive way to classify attacks that target users’ digital assets could be to juxtapose those that seek to find weak spots in software (say, secretly infecting victim’s computer with an ingenious virus) and those aimed at exploiting errors in human judgement (fooling a person into handing over their wallet’s private key).
Yet, in fact, these two modes exist on a spectrum rather than on a binary scale. The most successful thefts entail some degree of participation on behalf of the victim — such as opening a phishing email, using public Wi-Fi to check a crypto wallet or willingly installing a shady app — and a piece of malicious code, whether it is a Trojan or a scam bot on Slack.
Breaking the variety of threats down according to the attack vector is perhaps a more meaningful strategy. It is also far from optimal, though, as many known viruses these days can alter their behavior according to circumstances, and are capable of both installing hidden miners and simply stealing keys as needed. The following topology is therefore highly contingent.
Because no one wants to manually type in long strings of random alphanumeric characters that are also case-sensitive, we all use the copy/paste function to indicate the addresses we send our coins to. Clipboard hijackers (aka clippers) are pieces of malware that detect an event of clipboard use to store a crypto wallet address then trigger a script that replaces the correct address with that of an attacker. As a result, often without the victim realizing what happened, the digital currency flows straight to the thief’s pocket. Using the same technique, clippers are capable of stealing passwords and keys as well.
Perhaps the most sinister specimen of clipper malware uncovered so far in 2019 is the one that made it on the Google Play Store disguised as the mobile version of MetaMask, a popular client used to access decentralized applications (DApps) from a web browser — except, there is no MetaMask version for mobile. Although it was taken down soon after discovery, the very fact that the app managed to make it past Google Store’s defenses is impressive and it reminds us that even the authenticity of software found in major stores should not be taken for granted.
Cryptojacking, also known as hidden mining, is the covert exploitation of other users’ devices to mine cryptocurrency. Usually, a targeted computer gets infected by a Trojan that installs a miner. Victims do not get stripped of their crypto assets directly, yet the losses they sustain may be quite unpleasant, from footing enormous electricity bills to having an overloaded computer break down.
The number of detected attacks of this type exhibits a curious pattern of strong correlation with crypto prices. As the aforementioned reports suggested, the overall share of cryptojacking attacks appears to be declining this year — however, the ingenuity of their perpetrators is only growing. Some hidden mining operations may reach extraordinary scale, too: As Cointelegraph recently reported, a campaign using cryptojacking malware to mine the privacy-focused cryptocurrency turtlecoin (TRTL) was found to have infected more than 50,000 servers worldwide.
Just a few days ago, two browser extensions that secretly sponged their users’ central processing units (CPUs) to mine privacy-focused cryptocurrency monero were discovered on the official Google Chrome store. Previously, such malware was found to be hiding in legitimate Adobe Flash updates and convincingly posing as Windows installation packages.
Researchers from cybersecurity firm Trend Micro have uncovered a fascinating tactic employed by cryptocurrency hackers to smuggle monero miners onto Oracle enterprise servers. In order to obfuscate the malicious code, the program hides it in certificate files. This way, they go unnoticed by antivirus software that automatically treats certificate files as reliable.
Having originated in the remote corners of the darknet, where online stores selling illicit substances have long been “cloned” by scammers seeking to trick drug users into transferring bitcoin to their accounts, the technique is well and alive as of June 2019. The latest example is the case of the crypto trading website Cryptohopper, whose malicious copy facilitated in the infection of the computers of unwitting crypto traders who visited it. The victims had both mining and clipboard hijacking Trojans installed, resulting in an aggregate loss of almost $260,000.
Cryptocurrency trading platforms and exchanges appear to be the area of crypto sphere most vulnerable to hacking attacks, as they present shortcuts to swaths of centrally stored digital assets. Sky Guo, CEO and co-founder of Cypherium, told Cointelegraph that this has to change in order for the industry to be able to cope with rising security threats:
“Security threats happen on the level of the software, the infrastructure. But our industry needs to realize that there are dangers attached to presenting something as ‘decentralized’ in order to cash in on the security advances of blockchain tech. Projects like Facebook’s Libra and some other major projects already leading in our industry still have central points of failure by virtue of their highly permissioned network structures, and they need to be more transparent about the security implications of such systems.”
Social engineering as a separate trend
The term “social engineering” refers to a broad scope of malicious activities whereby wrongdoers use human interactions to accomplish their goals. These attacks usually rely on less sophisticated technical solutions, seeking to exploit the victims’ lack of attention, literacy or understanding of the context in order to obtain sensitive information or extort digital assets. As more people without much technical sophistication flock into the crypto space, simple schemes that didn’t stand a chance with old-school crypto buffs might suddenly become efficient.
Matthew Finestone, the director of business development at Loopring, an open-source protocol for building decentralized exchanges, observed to Cointelegraph:
“I really see attacks drawing on human inattention becoming more prevalent. It’s dangerous because newcomers to the space aren’t aware of these threats, and they often fail to realize that there is no recourse after cryptocurrency is sent, unlike traditional financial systems that can bail you out in worst case scenarios. Being careful, and learning from resources such as your article are a good starting point.”
Finestone also recalled his recent experiences with two rather simplistic social engineering schemes: one that came with an aggressive threat to release some harmful or embarrassing information if a crypto ransom was not sent to them shortly and another pretending to come from a friend or colleague asking for some coins. He concluded that both, like the majority of social engineering schemes, could be easily combated with vigilance and a healthy dose of common sense.
In fact, these universal principles apply to any type of potential attack aimed at your digital money. While a few of them are incredibly sophisticated, the majority count on the victim’s disregard of telltale signs apparent to the naked eye. It is always a good idea to double-check wallet addresses when performing transactions and to scrutinize the spelling of trading-related domains you visit. Making sure that your antivirus software is up to date is another useful habit that could save you some bitter regrets over digital money lost forever.
A Nasdaq-listed company says it is offering a blockchain-enabled alternative to “centralized authorities that perpetuate ad fraud, waste and abuse.”
A Nasdaq-listed company says it is creating a blockchain-enabled platform designed to decentralize data and empower consumers — all while giving brands an alternative to Facebook and Google in the quest to reach the public.
Phunware says it is leveraging 10 years of mobile technology experience to enable brands to deliver relevant content to a highly targeted audience, increasing engagement and resulting in a more memorable experience. Customers who share their data with a brand or build loyalty by engaging in profitable behavior, receive incentives, the team adds. Businesses can also begin to benefit from the technology by “supercharging” their current mobile apps with Phunware software add-ons, helping to reduce the cost of embracing a new approach to advertising and marketing.
At the beating heart of the company’s cloud platform for mobile is its Knowledge Graph. This graph database leverages machine learning to curate information that is gathered from a broad range of datasets, such as those acquired from smartphones and tablets that have Phunware software installed. From here, brands can unlock new features and data — safe in the knowledge that it is accurate, auditable and verifiable.
According to Phunware, its solution is designed to not only reimagine how brands engage consumers, but also to address the issue of ad fraud — a problem that the World Federation of Advertisers predicts could cost firms $50 billion a year by 2025.
“Phunware represents ‘a better way’ and the alternative to centralized authorities that perpetuate ad fraud, waste and abuse,” the company says. “The era of data collection through surveillance and exploitation is coming to an end. Phunware is ushering in a new era of data collection through collaboration and compensation.”
One important element of the company’s quest to save businesses money is by focusing on relevance — and eliminating what it regards as a flawed model in which brands end up paying internet giants even when their promotions reach someone who would never have any intention of purchasing their product.
As emphasis continues to shift to smartphones and wearables, Phunware says it wants to get a head start by building the infrastructure it needs for a new age of digital transformation into a mobile-first world now. The company compares its ambitions to those of Amazon, which built huge distribution centers early on and left other retailers struggling to catch up — and says its goal is to build a decentralized network to distribute data so that brands can better “identify, engage, manage, monetize and retain consumers forever.”
This is achieved by offering businesses deeper audience insight than they could ever hope to achieve through search engines and social networks. Brands can convert would-be shoppers into paying customers by delivering context-aware notifications and content that fully reflects the characteristics and habits of their target audience. Phunware is also a leading provider of indoor positioning technology, so branded content that is displayed to consumers can be personalized by weaving in this intelligence in more engaging ways, including based on location.
Phunware believes that such one-to-one interactions have never been possible on a global scale before — let alone in real time. The company’s latest statistics suggest that its Multiscreen-as-a-Service platform (or MaaS, for short) managed to reach an estimated 1 billion unique devices per month in the first quarter of 2019 alone.
A blockchain system with purpose
Phunware was one of only 10 companies selected by IBM for its new IBM Blockchain Accelerator. Part of the Columbia-IBM Center for Blockchain and Data Transparency, the accelerator is designed to provide enterprise companies with access to the assets, knowledge and support they need to build sustainable blockchain businesses and enterprise-grade blockchain networks.
Phunware says it offers a dual token economy in which one digital asset, PhunCoin, is a compliant security token that enables consumers to “monetize their digital identity,” while Phun is a utility token that enables consumers to “monetize digital activity” as they engage with brands by completing surveys, viewing branded content and participating in marketing campaigns.
Randall Crowder, chief operating officer of the United States-based company, said:
“We are excited to introduce Phun as a new utility token to not only support our ecosystem’s commercial launch worldwide, but also to position Phun for future exchange listings and enable the international community to get more actively involved as we drive towards mainstream adoption beyond our domestic borders.”
Phunware’s blockchain-enabled data exchange and mobile loyalty ecosystem was launched this week, all with a view toward enabling consumers to take control of their digital identity, “be compensated” for engaging with brands and wrestle power back from “untrustworthy intermediaries.”
Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.
In the wake of CCN’s Google saga, CT looks at which centralized companies have been hostile to crypto firms in the past.
Writing on the website, the director and founder of CCN Markets and Hawkfish AS, Jonas Borchgrevink, blamed the update for an overnight fall of 71% of the site’s mobile traffic. While Borchgrevink noted that ups and downs are part of the business, such a vertiginous fall is unprecedented in its history. At the time of the post, the founder said that it could not support new additions to its team or its current operations from advertiser revenue in the given climate.
Within the online crypto media sphere, CCN was not alone in taking a beating. According to data from Sistrix.com, CoinDesk also experienced a drop in traffic. Crypto news took what some are alleging to be a targeted hammering, even though United Kingdom-based online media juggernaut Daily Mail also reportedly lost half of its organic website traffic.
Related to this: The Strange Case of CCN and the Google June 2019 Core Update
At the time of this post on June 10, Borchgrevink and the CCN team were at a loss as to what could have merited such a steep drop off in visibility:
“If Google thinks that CCN, all of a sudden – remember, literally overnight -, is bad, then why not give us the chance to understand the why and give us a way to change before any major update. Instead, we are kicked in the teeth overnight with zero knowledge of what we have done wrong, impacting a team of 60+ people. 6 years of work is evaporated.”
However, only two days later, on June 12, CCN reported that it had clawed its way back into existence after an intensive period of consulting with SEO gurus and experts in the Google Webmasters forum. In the post, also authored by Borchgrevink, it is clear that the team is still not entirely sure what caused the drop, but continue to reference the June 3 update:
“Whether or not the Google June 2019 Core Update is to blame, we are fixing it. We’re receiving help from multiple SEO teams to understand what has transpired.”
Expert reaction to CNN’s self-proclaimed struggles
Several members of the crypto community spoke to Cointelegraph, stating that the update serves as a prominent example of how powerful, centralized corporations can currently smother crypto initiatives. Richard Red, research lead at Decred, a community-directed digital currency, said the update presents an issue for both freedom of the press and of information:
“Regardless of how people feel about CCN, the fact that changes to Google’s search algorithm can make or break media producers is one of many illustrations of the power wielded by large tech companies running centralized services. A centralized authority that can selectively ‘hide’ content signals a broader problem with freedom of the press and the public’s ability to find information.”
Roneil Rumberg, CEO and co-founder of the decentralized music streaming platform Audius, also said this is typical of the dangers of centralized power and called for a more transparent approach to online media:
“The unfortunate situation faced by CCN is inevitable when centralized aggregators like Google control content discovery. Those whose livelihood depends on aggregators have little insight into how these services work, let alone any say in how they are changed over time. They are subject to the whims of Google, YouTube, SoundCloud, or whoever else they are contributing to, and risk being deplatformed, demonetized, or otherwise taken for granted.”
Tak Kol, co-founder of the Orbs public blockchain, also commented on Google’s power to shape opinions and called for change that allows people to protect themselves from what he sees as abuses of such power:
“The situation with CCN and publications like it shows how much power Google has in dictating which news channels can flourish and which should disappear with a behind-the-scenes change in its algorithm. There is a solution to protect ourselves against potential abuse — and this is transparency, through blockchain technology. We should demand filters like Google to be explicit regarding the criteria of what’s deemed important, and we should demand to audit that this criteria is indeed what’s executed under the hood.”
Ad nauseam: Google’s chequered past with crypto
This is not the first time that Google appears to have taken a hard line on decentralization and crypto in general. The most prominent example of hostility from Google occured in June 2018, when the company announced that it would ban all crypto-related advertising in accordance with an update to its Financial Services policy.
The official announcement came days after crypto advertisers had noticed a sharp drop in views for its advertisements. At the time, Google AdWords denied that any change in its regulations would block crypto or initial coin offering (ICO) ads. However, as previously reported by Cointelegraph, Google’s updated financial products policy clearly stated that an advertisement ban will be imposed on “cryptocurrencies and related content (including but not limited to initial coin offerings, cryptocurrency exchanges, cryptocurrency wallets, and cryptocurrency trading advice).”
The move, however, was not necessarily out of character for Google, with Google’s director of sustainable ads, Scott Spencer, demonstrating a hesitant approach to all cryptocurrencies in a March 14 interview with CNBC:
“We don’t have a crystal ball to know where the future is going to go with cryptocurrencies, but we’ve seen enough consumer harm or potential for consumer harm that it’s an area that we want to approach with extreme caution.”
Fast-forward to January 2019 and Google’s advertising policy on cryptocurrencies remains relatively unchanged, with smart contract auditing startup Decenter tweeting that the company has blacklisted keywords mentioning Ethereum on Google Ads.
In response, the official Google Ads account replied to the tweet, stating that exchanges are permitted to target the United States and Japan and that ads targeting other countries could be liable for rejection.
Decenter further explained that, when trying to use “ethereum development services” and “ethereum security audits” as keywords, an error message would pop up. Google Ads replied to this in a tweet:
Hi there, thanks for your response. Although we wouldn’t be able to preemptively confirm if your keyword is eligible to trigger ads, we’d recommend that you refer to the ‘Cryptocurrencies’ section of our policy on Financial products and services: https://t.co/BpvQoukwY3. -Chetan
— Google Ads (@GoogleAds) January 10, 2019
Decenter consequently turned to the Ethereum community on Reddit, where the team stated:
“Any of the keywords that contain ‘ethereum’ in our campaigns are no longer showing ads as of January 9th and are now reporting the following error:”
At the time, the Reddit post’s top comment accused Google of a lack of neutrality:
“Google has various political and economic agendas, and they are quite willing to use their various services to promote their preferences. AdSense and Youtube are notorious for this, but there have been some incidents regarding the play store as well.”
Google is not the only centralized tech giant to have a troubled relationship with both crypto and crypto advertising. Prior to lifting the requirements on May 8 for crypto and blockchain promoters to get consent for running advertisements, Facebook had adopted various degrees of censorship.
In January 2018, Facebook decided to ban all cryptocurrency and ICO advertisements — a move that was widely criticized by the crypto community as unnecessary. Dejun Qian, the founder of Fusion, which provides a financial transaction ecosystem, said:
“This policy will definitely protect people from the scams of predatory projects. However announcing an ‘intentionally broad’ policy is always the easiest way and not necessarily the best route for technology development.”
Since then, Facebook has come to relax its approach to advertising as long as advertisements are not seen to be promoting one currency in particular or initial coin offerings. And Facebook has since announced that it will launch its own stablecoin.
Read more on this: Project Libra: What We Know About Facebook’s Forthcoming Cryptocurrency
E-commerce giants show uniform approach to crypto
It is not only big tech that’s showing resistance to cryptocurrencies. In 2019, two of the world’s foremost e-commerce giants demonstrated varying degrees of hostility to cryptocurrencies and associated cryptocurrency advertising.
On March 18, South America’s largest e-commerce company, Mercado Livre, banned cryptocurrency advertising on its website, according to reporting from Cointelegraph em Portugues. Mercado Livre, which recently overtook Amazon as the top e-commerce marketplace in Latin America, sent out emails to users that laid out the change in company policy. According to an email shared with Cointelegraph, all listings related to digital currency would automatically be removed from the platform as of March 19:
“We would like to inform you that as of March 19, you will no longer be able to advertise used products in the following categories:
– Prepaid cards for games
“Because you have ads for used products that will soon be banned, we recommend that you end them. Otherwise, they will be finalized on the date mentioned above.”
Mercado Livre’s biggest rival, Amazon, also demonstrated its less-than-enthusiastic approach to cryptocurrencies in 2019. Twitch, a streaming company owned by the U.S. e-commerce behemoth, removed bitcoin (BTC) and bitcoin cash (BCH) as payment options for subscriptions, according to a Reddit user on March 23.
Payday blues: Payment providers close the door on crypto
Although the initial benefits of cryptocurrency for payment providers are numerous, a number of high-profile companies have either removed payment options or outright banned crypto payments.
On May 7, Dovey Wan, a founding partner of Primitive Ventures and a prominent figure in China-related crypto affairs, tweeted that the Chinese social media titan and payment service provider WeChat will ban merchants from making cryptocurrency payments.
A translation of the Payment Service Protocol, posted on weixin.qq.com, revealed that the ban is due to changes in payment regulation and efforts to ensure “the prevention of illegal telecommunications networks and criminal matters” brought about by the People’s Bank of China.
As per the screenshot posted by Wan, users who carry out crypto trades are liable to have their accounts terminated. The screenshot also shows that “merchants may not engage in illegal transactions such as virtual currency.”
Unsurprisingly, given the chilly atmosphere for cryptocurrencies in China, WeChat is far from alone in its approach. In August 2018, the mobile payment app Alipay clamped down on users who were using their accounts for over-the-counter (OTC) bitcoin trading, according to Beijing News.
As per the state-affiliated Chinese newspaper, Alipay tightened restrictions on and permanently blocked accounts carrying out bitcoin OTC trades. The article also stated that a system had been created to monitor key websites and accounts for this purpose.
Misfortune for crypto payments in China continued into 2019, when Alipay and WeChat both requested that crypto exchange Huobi remove their payment services from its OTC trading desk, according to a report by local media agency Sina published on Jan. 25.
CFO John Rainey said that, although the company had previously allowed payments in bitcoin, the volatility of the currency meant that merchants would just convert bitcoin to a more stable currency, such as the euro or dollar. Rainey commented that, although the company is not currently interested in cryptocurrencies, he did not rule out involvement in the future:
“We have teams clearly working on blockchain and cryptocurrency as well, and we want to participate in that in whatever form it takes in the future. I just think it’s a little early on right now.”
BTC cards suffer setback, Visa and Mastercard categorize crypto as high-risk
In January, Visa ended its working relationship with debit card provider WaveCrest, affecting crypto card products provided by CryptoPay, Bitwala, Wirex and others. The move was initially believed to be a company crackdown on cryptocurrency services, but was later revealed to be due to WaveCrest violating Visa’s policies.
A Visa spokesperson commented that the issue came down to noncompliance on WaveCrest’s behalf and that it had not adopted a blanket ban on such products:
“We can confirm that WaveCrest’s Visa membership is being terminated due to continued non-compliance with our operating rules. All of WaveCrest’s Visa card programmes will be closed as a result. Visa has other approved card programmes that use fiat funds converted from cryptocurrency in a number of jurisdictions. The termination of WaveCrest’s Visa membership does not affect these other products.”
In October, Finance Magnates reported on the news that payment titans Mastercard and Visa would classify cryptocurrency and ICOs as “high risk.” The publication, which did not disclose its sources, reported that a ban will be applied to brokers operating from “unregulated or loosely regulated environments,” a sweeping description that proved damning for the wave of crypto debit cards. As no universal policy exists for regulating cryptocurrency payments, many companies offering crypto debit card services could, as a consequence, be seen as not having applied proper due diligence to their business.
The publication also referred to regulations brought in by the European Securities and Markets Authority (ESMA) in June, establishing leverage limits for local retailers in the European Union. Steve Maijoor, the ESMA chairman, said that the regulation would seek to protect investors:
“The new measures on CFDs will, for the first time, ensure that investors cannot lose more money than they put in, restrict the use of leverage and incentives, and provide understandable risk warnings for investors.”
Unregulated brokers are reportedly classified as “high-risk securities merchants” by the two biggest debit/credit card issuers. Mastercard acted on Oct. 12, 2018, and the subsequent changes would affect “all transaction globally via Mastercard, Debit Mastercard, and Maestro.”
The move to target crypto debit cards is not that surprising, given the views of management at the two payment giants. Mastercard CEO Ajaypal Banga voiced his criticism of cryptocurrencies, stating that nonstate-issued coins are junk, due to their high volatility and the as-of-yet unrealized goal of operating as a real alternative to fiat currency.
To strengthen the narrative, Mastercard released a series of anti-bitcoin videos, narrated by the president of Mastercard Southeast Asia, Matthew Driver, in which he questioned the anonymous nature of crypto transactions:
“If it’s an anonymous transaction, that sounds like a suspicious transaction. Why does somebody need to be anonymous?”
Bitcoin is reportedly producing as much carbon emissions as Kansas City, while Facebook gets some new backers for its crypto project.
Cryptocurrency news outlet CCN (formerly CryptoCoinsNews) is apparently not going through with its total shutdown, as reported earlier this week. The outlet had previously posted a note that a recent Google Core Update had led to a more than 70% visibility drop on mobile overnight, leading the organization to decide to shut down rather than downsize. However, an update this week from CCN Markets Director Jonas Borchgrevink notes that, for an unexplained reason, the crypto outlet’s old domain name, CryptoCoinNews, has been showing up with new 2019 articles on Google, leading the team to decide to keep working. Theories about the visibility drop, which affected other news outlets, have ranged from it being a block of clickbait titles or a ban on conservative outlets by an allegedly “liberal” Google.
United States residents who use major crypto exchange Binance will lose trading option access for many cryptocurrencies when the exchange puts into action its updated terms of service this September. As reported this week, Binance updated its terms of service to include trading on the platform for U.S. residents, a change that comes shortly after its announcement of a U.S.-exclusive fiat-to-crypto exchange. According to a table created by CryptoPotato, there are a number of cryptos that will no longer have a trading outlet in the U.S., as well as several tokens that will be listed on only one exchange after Binance closes for U.S. residents. However, veteran cryptocurrencies — including XRP, DASH, XLM, ETC and ZRX — will still be listed on four or more other U.S. exchanges.
The announcement this week from crypto exchange platform Liquid that it would be offering encrypted messenger Telegram’s token, gram, in a sale is not officially connected with Telegram, according to a source close to the messaging app. As Cointelegraph had reported earlier this week, Liquid had said that it would be the representative of gram tokens for Gram Asia, which it called the largest holder of the token in Asia. However, in comments to Cointelegraph, a source close to Telegram noted that it was the first time that it had heard of Gram Asia. In separate comments, an investor in Telegram’s token told Cointelegraph that no one has rights to sell the tokens before its official launch. Liquid CEO Mike Kayamori told Cointelegraph that the public sale is the result of an exclusive agreement between Liquid and Gram Asia, without the direct involvement of Telegram.
According to a new report published in the journal Joule, the carbon emissions generated by bitcoin (BTC) are comparable to the whole of Kansas City. According to Christian Stoll, one of the project’s researchers, the energy consumption used in mining the largest cryptocurrency is only growing, noting that the computing power needed to solve a BTC puzzle has more than quadrupled since last year. The study was based on data from IPO filings and IP addresses of some of the largest mining companies, finding that bitcoin is placed around Jordan and Sri Lanka — in international terms — due to its annual emissions of CO2, estimated to be between 22 and 22.9 megatons.
According to a report from The Block, Facebook has reportedly secured support from dozens of players in the cryptocurrency and blockchain sector for its upcoming, secretive digital currency. The Wall Street Journal had reported earlier this week that Facebook had allegedly received the backing of $10 million each from firms — including Visa, Mastercard, PayPal and Uber — for the project, dubbed “Libra.” The Block cited further materials, noting that the project’s investors also include venture capital firms Andreessen Horowitz and Union Square Ventures, cryptocurrency exchange Coinbase and nonprofit organizations including Mercy Corps. According to a source speaking to The Block, the company aims to gather 100 members in the governing consortium, with a total planned for $1 billion, including all participants.
Winners and Losers
The crypto markets have seen a slight uptick at the beginning of the week, with bitcoin trading at $9,054, ether at $269.54 and XRP at $.41. Total market cap is at $281 billion.
The top three altcoin gainers of the week are acre, commerce data connection and renos. The top three altcoin losers of the week are tronclassic, segwit2x and hypnoxys.
For more info on crypto prices, make sure to read Cointelegraph’s market analysis.
Most Memorable Quotations
“Some short term pains may be necessary for long term gains. And we always work hard to turn every short term pain into a long term gain.”
— CZ, Binance CEO
“If Google thinks that CCN, all of a sudden — remember, literally overnight — is bad, then why not give us the chance to understand the why and give us a way to change before any major update. Instead, we are kicked in the teeth overnight with zero knowledge of what we have done wrong, impacting a team of 60+ people.”
— Jonas Borchgrevink, director and founder of CCN Markets and Hawkfish AS
“Millennials don’t carry cash, they date on apps and watch on-demand entertainment. We have to be there, we have to learn from successful tech companies, and we have to provide a universal solution that makes it easy for younger generations to engage with the Church.”
— Rick Santorum, former United States senator
FUD of the Week
Dispatch Labs, a blockchain company, is currently incurring large losses, despite extensive investment and a recovering cryptocurrency market. The blockchain firm had raised over $13 million in a series of private rounds in 2018, with investors including China-based capital firm Fenbushi Capital. Dispatch Labs’ total remaining investment has since dropped to around $6.5 million, with CEO Matt McGraw reporting noting that the company did not have sufficient over-the-counter availability to liquidate digital currency that could have staved off the threat driven by the market downturn. However, McGraw added that the company has enough working capital to last through the year, taking into consideration the tentative market recovery.
Cybersecurity firm Trend Micro confirmed this week that attackers have been exploiting a vulnerability in the Oracle WebLogic server to install monero (XMR) mining malware. The malware uses certificate files as an obfuscation trick to carry out cryptojacking, a process wherein malware uses a computer’s operating processing power to mine for cryptos without the owner’s consent or knowledge. According to Trend Micro, a security patch for the Oracle WebLogic vulnerability had been released in the national vulnerability database earlier this spring. The report also includes a recommendation for firms using that server to update their software to the latest version with the security patch in order to mitigate the risk of cryptojacking.
Cryptocurrency exchange Bittrex said this week that it would block its U.S.-based users from trading in 30 cryptocurrencies. According to the announcement, after June 21, American traders will be unable to access a list of coins traded on the exchange, including QTUM and STORJ. Bittrex noted that U.S. users will receive an email with explanations behind what they are and are not allowed to do with the aforementioned assets, included selling them for assets that will stay available to them, canceling orders and moving them off the exchange. Once the ban comes into effect, U.S. users will not be able to buy or sell the select coins, and all open orders involving those coins will be cancelled. However, the coins will be transitioned to the Bittrex International platform.
Best Cointelegraph Features
Cointelegraph takes a look at the types of special economic zones for cryptocurrencies around the world: to some Russian spaces, which seemed to have paused development, to Switzerland’s Crypto Valley, which is not technically a special economic zone, despite its name.
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One of the oldest crypto sites shuts down, then comes back up immediately, citing loss of traffic.
Here at Cointelegraph, we were as shocked as everyone else in and around the crypto-sphere when we learned about the abrupt closure of stalwart crypto media outlet CCN. Established at around the same time as Cointelegraph and CoinDesk, CCN spent years competing for the crypto audience.
However, just a couple days later, as many others, we were relieved to hear that CCN was back — although we couldn’t help but feel sceptical regarding several aspects of the story and puzzled by so many questions swirling around it.
How come a key player in our own industry could go down overnight — and then come back so conveniently after a few days? How could a three-letter-dot-com domain commanding millions of monthly visits be so hooked on Google-fed traffic that a single adjustment in the search algorithm, albeit a major one, cost it 90% of ad revenue momentarily?
What was it, really? A targeted, politically motivated character assassination on behalf of the tech giant (as CCN’s founder claimed)? An unfortunate alignment of circumstances with no one in particular to blame? Possibly a PR stunt, or something else? We felt we owed it to the entire industry to take a sober look into this case to find out whether something similar could happen to any of us at any point in the future.
What happened to CCN?
CCN Markets, established in 2013 by the Norwegian entrepreneur Jonas Borchgrevink as CryptoCoinsNews.com, is currently part of the media company Hawkfish AS, which also operates Hacked, a publication that provides analysis on “future assets” like cryptocurrencies and tech stocks; MoneyMakers, a self-identified “tabloid that produces news with a special focus on money”; and HVY.com, a news platform that is designed to promote journalists rather than news stories. One of the largest global crypto-related news outlets, the majority of traffic to ccn.com comes from the U.S. As of early June 2019, the publication reportedly employed more than 60 full-time, part-time and freelance contributors.
On June 10, CCN founder Jonas Borchgrevink addressed the readers with an extensive post, declaring that the website took a massive blow from Google’s June 2019 Core Update and saw mobile traffic from Google searches drop by 71% overnight, as measured by Sistrix’s Visibility Index (the same graph also showed a 53% decline in desktop traffic). This, Borchgrevink claimed, resulted in an immediate 90% decrease in ad revenue. He added that, although CCN had reached even lower visibility scores on a few occasions throughout the past year, the latest dip proved the most devastating because of the recent expansion of its team.
Borchgrevink suspected a possible “general crypto crackdown by Google,” citing smaller but substantial losses on the same metric allegedly sustained by CNN’s competitors — i.e., CoinDesk and Cointelegraph. However, regarding Cointelegraph, the data Borchgrevink cites is inaccurate, based on conversations with Cointelegraph’s SEO team and public data that shows no reversal or even a slowdown around June 10. On the contrary, it reveals a steady upward trend in Cointelegraph’s Alexa Rank dynamics that is visible since mid-May. According to a Forbes article, other prominent publications in the crypto space, such as Coindesk and The Block, also reported insignificant effects from Google’s update.
CCN’s director went on to discuss other potential reasons for the website’s visibility collapse, including Google’s guidelines for additional scrutiny applied to “Your Money, Your Life” websites — in other words, outlets that provide information related to either health or personal finance and are therefore subject to more stringent content quality requirements. Borchgrevink then ruled out the possibility of having been taken down on the grounds of quality, listing all CCN’s well-deserved awards, quality seals, and editorial and business practices that speak in favor of the publication’s blue-ribbon status.
Finally, CCN’s boss turned to politics as an explanation for Google’s allegedly unfavorable treatment of his website. He noted that, despite being pro-free speech and providing a floor for opinions from all over the ideological spectrum, CCN has recently featured a lot of specifically “Pro-Trump” op-eds, which, he implied, was in line with the publication’s “anti-elite, anti-centralization” stance, which Google, according to him, allegedly opposed. He also pointed out that, as a result of the recent update, some right-leaning British newspapers saw their Google traffic decline, while some of their left-leaning counterparts enjoyed gains.
While there are no direct accusations of Google being politically biased in the text, in the accompanying video, rather fierce language is abundant: For one, Borchgrevink calls it a “fascist corporation” that is trying to censor anyone who “remotely dips its toe out of the left-leaning bubble.” This was followed by calls for everyone who cares about free speech to wake up and rally against the “Googlémocracy” and disrupt the overwhelming corrosive corporate power, along with a list of demands for Google.
The meltdown concluded, rather unexpectedly, with a statement of CCN shutting down in the wake of revenue losses incurred thanks to Google. Reluctant to downsize the team, Borchgrevink announced redeploying everyone to HVY.com.
What is a Google Core Update?
As Google’s numerous products and services, from Gmail to Chrome, have come to dominate their respective market segments, the company’s fundamental value proposition lies in fast and relevant search output. In response to a query, the search engine uses a complex system of proprietary algorithms and filters to furnish the user with lists of web pages ranked by relevance, also called search engine results pages (SERPs).
In order to improve the quality of this output, Google introduces hundreds of subtle tweaks to this system every year — of which, most are barely noticeable — and sometimes rolls out major updates that affect the core algorithm’s functionality. The latter often become milestones for entire businesses reliant on Google-generated traffic, severely affecting their bottom line for better or worse.
The Google June 2019 Core Update is the second large-scale adjustment so far this year, and also the first one ever to be announced by the company in advance. The previous update in March focused on areas where the so-called EAT factors (i.e., Expertise, Authoritativeness, Trust) are deemed the most important, resulting, for example, in massive fluctuations in health care-related websites’ search visibility.
In the wake of that update, Google specifically pointed out that, while improvements are focused on website content, its quality is not a primary criterion, and there is nothing “wrong” with websites that took a dip in visibility rankings. At the same time, there is nothing that could be done to “fix” such websites. With regard to the June update, the precise focus of the adjustment remains unclear, as websites from a variety of regions and subject fields found themselves affected.
As Glen Allsopp, founder of SEO firm Detailed.com, noted to Cointelegraph:
“Past Google updates could certainly be described as targeting certain industries, with an August 2018 update being dubbed ‘Medic’ due to how many health sites were impacted. Health and finance sites appear to have seen big swings once again, as have quite a lot of news sites. That said, this one feels broader to me.”
There are numerous criteria at play when the algorithm determines the rank of a particular web page in search output. Perhaps most prominent in the last few major updates are the aforementioned YMYL and EAT guidelines that prescribe varying quality standards for different categories of websites. In addition, Google routinely locates and takes down various schemes, which shrewd webmasters employ in order to boost traffic and ad revenues.
This Medium post, for instance, describes one such mechanism that large trusted portals use to game the algorithm and profit from the additional unrelated content on their domains. Cointelegraph’s SEO specialists observed that many financial media who took a hit from the June update saw their coupon schemes cut.
Webmaster forum development and CCN’s resurrection
In response to an inquiry from Forbes’ Benjamin Prius, a Google representative reiterated a statement from March 2018 that some websites may experience traffic fluctuations due to a core update. Moreover, the boost for the pages that come to perform better might stem from the fact that they have been undervalued previously. They also pointed to Google webmaster forums as a place to seek advice on issues that arise in the wake of algorithm adjustments.
Indeed, in the original post, CCN’s director reported seeking guidance from the webmaster community but said that their theories explaining the CCN situation did not “appear to be entirely accurate.” Meanwhile, one of the considerations that emerged in that thread around the time of the closure announcement could well be the key to understanding what happened to CCN’s search visibility. Some of the community members noticed that pages from the old domain, cryptocoinsnews.com, resurfaced in search output, redirecting to the current CCN home page — a behavior that one of the webmasters called “a sure fire way to confuse search engines.”
Two days after the closure announcement, Borchgrevink followed up with yet another statement in which he acknowledged the glitch of the old domain showing up in search results — even in search results for recent CCN articles. He also sounded less convinced that the core update was the root of the evil:
“Whether or not the Google June 2019 Core Update is to blame, we are fixing it. […] There’s still a good chance that this won’t correct our visibility on Google overnight, but I’m hopeful we are on the right path to figuring it out.”
And then, even more abruptly than the announcement of CCN shutting down, the announcement of CCN coming back arrived:
“Enough said. CCN.com is back.”
Versions and reactions
Granted, CCN’s own core readership was deeply saddened by the news of CCN’s demise and rejoiced when it was reversed. Some crypto blogs subscribed to the “evil Google” narrative unconditionally; others tried to test their own hypotheses as to what the search engine update could mean for the industry. One of them, Inside Trade, ran an experiment to assess whether the improved algorithm favored websites on Google’s own Adsense network, which yielded mixed results obtained from a tiny sample.
Some of the crypto industry’s experts, though, did not find Borchgrevink’s account of the events all that compelling. “What Bitcoin Did” podcast host Peter McCormack tweeted:
I suspect the closure of CCN is more than just down to a change in the Google algorithm. If the rollout was June 3rd and the decision was a week later, I assume they had bigger problems.
— Peter McCormack (@PeterMcCormack) June 10, 2019
Elad Mor, CEO of MarketAcross and co-founder at InboundJunction — a content marketing, SEO & PR agency for startups — told Cointelegraph that the Google search algorithm might indeed be a headache for publishers, but in this case, it was likely not the only factor:
“Google updates can be vicious. We’ve seen businesses go from hero to zero after massive Google algorithm updates. ‘Notorious’ updates such as Google ‘Panda’ or ‘Penguin’ have left scorched territories behind them and were real game-changers for SEOs and publishers relying on organic traffic.
“We’ve been working with CCN’s news department for a while, their attitude of straight shooting investigative journalism and compromised quality makes me think that this “penalty” is a very technical one and could be sorted by working closely with Google support and adhering to their strict guidelines. There might also be more to the story, since a big website like CCN doesn’t close overnight or changes its decision the day after.”
Trey Ditto, CEO of Ditto PR, a full-service communications firm with crypto and blockchain practice, suspects that more systemic determinants could be at play:
“The media landscape in crypto is shrinking. Either media outlets need to step up to fill the void, or crypto and blockchain projects need to recognize that getting media coverage is a tactic and not a strategy. Most people I’ve talked to don’t seem to be buying the narrative that Google is at fault for CCN’s shutdown. A more logical explanation is that a lot of crypto media outlets are struggling to adapt and mature with the market. If you have a high burn rate or lack a way to monetize outside of ads, you won’t last through the remainder of crypto winter. The same goes for crypto projects: Evolve quickly or die off.”
So, it may appear that at least one of the immediate reasons behind the CCN’s search visibility nosedive was in fact not triggered by the Google June 2019 Core Update, but merely coincided with it. From conversations with Cointelegraph’s SEO team, it emerged that the old domain’s sudden comeback was likely prompted by its 301 redirect — a tool used to establish a permanent redirect from one URL to another — breaking down, which resulted in old pages appearing in the search index again. As two sets of pages with identical content surfaced, Google’s algorithm identified them as a dishonest attempt at gaining visibility and began lowering their ranking accordingly.
Not all SEO professionals subscribe to this view. Glen Allsopp observed to Cointelegraph that the redirect seems to be in place still:
“This is not common, unless the old domain is resurrected in some form, which doesn’t appear to have been the case for CCN and their previous domain, cryptocoinsnews.com. You can check Archive.org and all June mentions show their domain redirect still in place. I saw the comments regarding their old domain now ranking in search results but two premium third-party analysis tools I use – Ahrefs and Sistrix – both fail to show any search visibility at all for their old domain name. They may have missed it, but I would be very surprised by that”
The confusion around what has really happened to CCN’s traffic, of course, does not mean that Google’s enormous and unchecked power over online search, advertising and publishing industries is not a pressing issue — or that online journalism’s dominant ad-based business model is not flawed.
Shortly after the news of CCN’s shutdown hit the press, unverified claims of the publication’s attempted acquisition began to circulate online. The alleged benefactor was also specified: Stankevicius MGM, a global PR and advertising firm headquartered in the UAE. If the validity of these talks is not unfounded, the timing of the events would be crucial to understand whether the attempted deal had any influence on the general plot line.
Roma Stankeviciene, Stankevicius MGM’s executive vice president, confirmed that the negotiations did indeed take place. In fact, it turns out that CCN received more than one offer in between shutting down and coming back:
“CCN CEO’s message was quite convincing, so yes, our CEO approached them to discuss whether a sale or an M&A. We were willing to offer 7 digits net for the media site. We didn’t keep this as a secret, and told colleagues and business contacts about our interest in CCN, and so the talks spread.
“We noticed once our story hit the news, another media company decided to make an offer as well, and it was kind of a copycat move in a way because we actually approached the CCN first right after their announcement and we were serious about it, and having another company drop into the deal with a new offer only make things complicated.
“However, later we heard that CCN was not selling anymore as they got their traffic back from Google. It’s unfortunate, we would have done something great with the site.”
The statement therefore suggests that the acquisition negotiations did not prompt the shutdown. If anything, they could only trigger CCN’s decision to go back up defiantly. Meanwhile, Stankevicius MGM executives remained unconvinced by the publication’s own version of the story:
“They claimed that they lost traffic, still even if they lost it, they had more than enough traffic and brand awareness to keep the business going. […] We still think internally that their announcement was not true.”
Amid all the uncertainty, InboundJunction’s Mor aptly summarized:
“Whatever the reason is, we’re happy they are still in the game.”
SmartContract.com, a middleware supplier that melds traditional computing tools with dApps, has partnered with Google to get big data onto the blockchain.
Google Cloud has integrated Chainlink’s oracle middleware with its BigQuery enterprise cloud data warehouse.
The Google Cloud team has integrated Chainlink’s oracle middleware with its BigQuery enterprise cloud data warehouse, allowing for an on-chain and cloud-based interaction with Ethereum decentralized applications and smart contracts. The news was revealed in a development report published on June 13.
As previously reported, a blockchain oracle is a system that provides the necessary external data — i.e. the variables to be evaluated — to trigger the execution of a smart contract when the original terms of the contract are met.
The development post writes that Google has made public blockchain data for eight different cryptocurrencies freely and publicly available in BigQuery through its Google Cloud Public Datasets Program.
While this resource allows for “the development of business processes based upon automated analysis of the indexed blockchain datasets,” the report notes that these nonetheless remain limited by the fact that they use the resource as an input to an off-chain business process.
Google’s way to solve this task is to enable the Ethereum smart contract platform to interact with its BigQuery enterprise cloud data warehouse automatically and on-chain by using Chainlink’s oracle middleware.
This allows for a smart contract to be triggered using data that is retrieved from an on-chain query to the internet-hosted data warehouse. Google notes that the system can be generalized to develop hybrid cloud-blockchain applications, in which smart contracts efficiently delegate complex operations to cloud resources.
Aside from outlining in technical detail how the interoperable looping functions, Google’s post also proposes three implementations for hybrid cloud-blockchain applications that it claims are of high and immediate utility: prediction marketplaces, futures contracts and transaction privacy.
As reported, Google announced in August 2018 that it had officially made the Ethereum blockchain dataset available in BigQuery.
This May, blockchain platform Qtum — which like the Ethereum platform focuses on smart contracts and decentralized applications (DApps) — revealed its collaboration with Google Cloud as a software partner to increase the ease of launching native products for users.
To press time, the Chainlink token (LINK) — ranked 24th largest cryptocurrency market cap — is up almost 34% on the day to trade at $1.53, according to CoinMarketCap.
United States-based bitcoin-supporting payments service Square Crypto announced that it recruited former Google product director Steve Lee.
Square Crypto was announced in March of this year when the organization joined Twitter, and planned to hire crypto engineers and designers to work on the bitcoin and crypto ecosystem, paying them in cryptocurrency.
Just hours before announcing Lee’s recruitment, the official Twitter Square Crypto account asked — in what appeared to be a joke — the community to welcome the company’s “summer intern and inaugural hire, Gary Fuches.” Then, the author of the next tweet claimed to be Fuches and noted his commitment to blockchain technology:
“Hello everybody! My name’s Gary and I’m here to say, I love blockchain in a very big way!!!”
A significant portion of the respondents reacted by correcting him and noting that he should have said bitcoin, instead of blockchain. One hour later, the management announced the hiring of Steve Lee in another tweet:
“Hey guys. Management again. Unfortunately, things didn’t work out with Gary. However, we think we’ve found somebody who can live up to his commitment to decentralization. Please welcome Steve Lee, aka @moneyball, to the Square Crypto team.”
As the next — and last — tweet sent by the account notes, Lee is a former product director at Google, an angel investor and a volunteer project manager for bitcoin development. His LinkedIn profile further notes that he has also been a software engineer at technology giant IBM and a product manager intern at Yahoo. Lee, as some members of the community did in response to Gary’s alleged tweet, noted:
“Bitcoin, not blockchain. Very excited about this opportunity!”
As Cointelegraph reported at the beginning of May, Square saw a new revenue high from bitcoin sales through its Cash app, while profits from bitcoin sales remained low.
A chance increase in visibility of CCN’s old CryptoCoinsNews identity is causing confusion, say executives.
CCN, which on Monday published a warning that it would cease operations immediately over an ongoing Google indexing debacle, says it is still working to understand changes in its online visibility.
As Cointelegraph reported, an update to Google’s algorithm allegedly produced an instantaneous 70% drop in traffic for CCN, with executives subsequently saying they had no choice but to abandon the project.
Now, support from Google has apparently changed the plans for a total shutdown, thanks to further unanticipated behavior from algorithms, which are reportedly flagging articles under CCN’s old CryptoCoinsNews identity.
“While we’ve been working in the dark, trying to get to the bottom of our massive visibility drop on Google, a friendly helper in Google’s forum mentioned that ‘CryptoCoinsNews.com’ — our previous domain — is reappearing in Google searches,” Wednesday’s update, written by CCN Markets director Jonas Borchgrevink, states.
“That was a massive surprise for us as I personally requested a domain name change in 2017 from CryptoCoinsNews.com to CCN.com. Since that change, ‘Cryptocoinsnews.com’ was effectively absent on Google. Now it’s back and is inexplicably using recent 2019 articles from CCN.com. This is abrupt and confusing.”
Commentators had also claimed that all cryptocurrency media sites except one — Bitcoinist — had suffered as a result of Google’s update. However, Cointelegraph’s traffic was not actually affected by the Google Core Updated as previously reported.
The latest events do not guarantee a full return, the publication added, and attempts to correct the initial drop continue. CCN’s initial announcement of their closure had also noted that they would be moving the CCN team to HVY.com, a news platform for journalists.