India Targets Cryptocurrency Crime аs Part оf Cyber Security Offensive

The government has formally opened a cyber security lab and strengthened police powers to investigate possible crypto-based crime.

Cryptocurrency crime forms one focus of a dedicated cybercrime lab launched by Indian authorities this week, Indian daily news outlet The Hindu reported on Feb. 19.

As part of efforts to step up the fight against internet-based adversaries, India’s Union Home Minister Rajnath Singh inaugurated the cyber forensic lab and Cyber Protection Awareness and Detection Centre (CyPAD), which will be operated by police in Delhi.

Within the lab, there will be a special unit focused on cryptocurrency, following years of problems involving scammers using the emerging phenomenon to commit crime.

“We are now equipped with technology to recover data from damaged hard disks, cryptocurrency analysis, malware forensic and data can be retrieved from 33,000 kinds of mobile models available in the market,” the Hindu quotes Delhi Police Commissioner Amulya Patnaik as saying.

The announcement comes as India continues to make slow progress on separating the actions of criminals from legitimate usage of cryptocurrency.

Local scams encountered by police regularly make the headlines, but domestic cryptocurrency businesses have complained that the position adopted by India’s central bank has not helped create a more robust landscape.

As Cointelegraph reported, the Reserve Bank of India enacted a ban on banks serving crypto businesses in July last year, a decision that has since been challenged in the country’s highest court.

Earlier this month, a government research panel appeared to suggest Delhi was concerned about the potential impact of cryptocurrency on the stability of the rupee.

Japan’s Number Two Bank by Assets Completes R3 Blockchain-Based Trade Finance Trial

SMBC conducted a proof-of-concept of R3’s Marco Polo with a multinational Japanese player.

Japan’s second-largest bank by assets, Sumitomo Mitsui Banking Corporation (SMBC), has completed a proof-of-concept (PoC) using blockchain consortium R3’s Marco Polo trade finance platform. A press release confirmed the PoC completion on Feb. 18.

SMBC, which is the only Japanese bank participating in Marco Polo, said it had partnered with Japanese multinational Mitsui & Co. to enhance efficiency in trade processes.

“[The] PoC was conducted between SMBC and Mitsui & Co. which aims to improve productivity in its trade operations, by testing modules such as Receivable Finance and Payment Commitment (Payment Undertaking),” the release explained, adding:

“SMBC expects to commercialize Marco Polo in the first half of (the financial year 2019) after verification of the PoC.”

Launched in 2017, Marco Polo is a joint venture between R3 and Irish tech firm TradeIX targeting trade finance utility using distributed ledger technology.

Leveraging R3’s Corda technology, a total of 15 consortium member banks are currently participating in the Marco Polo consortium, including ING, NatWest and BNP Paribas.

In May last year, Thailand’s biggest bank, Bangkok Bank, also joined the initiative with an eye to streamlining trade finance.

R3 is a New York-based group of businesses, banks and other entities founded in 2014 as a distributed technology company. At its launch in September 2015, it had a total of nine members. This January, R3 announced the launch of its Corda Network, with the consortium now made up of over 300 members.

Report: Bitmain IPO Document Reportedly Reveals $500 Million Q3 Losses

An earnings report for 2018 is alleged to show the company suffered considerably in Q3 versus H1.

Bitcoin (BTC) mining giant Bitmain could have made losses of around $500 million in Q3 last year, industry magazine CoinDesk reported on Feb. 19, citing a company document.

Bitmain, which is currently attempting to launch an initial public offering (IPO) under the auspices of the Hong Kong Stock Exchange (HKEx), submitted a report into its earnings in line with listing requirements.

According to the publication, that report indicated that for 2018 as a whole, excluding Q4, revenue was $3 billion and profits $500 million. This contrasts with previous figures for the first half of the year, for which profit was $1 billion.

If the information is correct, the assumption is that Q3 cost Bitmain $500 million in losses, corroborating a widely-held theory that the accelerating Bitcoin bear market late last year took a serious toll on the mining sector.

As Cointelegraph reported, Bitmain’s IPO filing process, which could raise significant funds for the company, has been fraught with difficulties since the plans made their way into the public realm in Q2 2018.

HKEx itself added to the doubts in December, with rumors claiming the exchange was unwilling to approve any cryptocurrency offering due to the industry’s volatile nature.

At the same time, Bitmain had revealed several contractions of its global operations along with cuts to staff numbers. The company also released its new Bitcoin mining hardware chip this week.

Report: Coinbase-Supported Bitcoin Debit Card to Shut Operations in April

The three-year-old scheme faced skepticism about its popularity on launch, but Shift has not publicly stated the reason behind its decision.

The Shift Bitcoin (BTC) debit card, which allows United States cryptocurrency exchange Coinbase users to spend BTC using a Visa debit card, is reportedly shutting down its operations. The development was posted to Reddit on Feb. 18, with the upload of an email purportedly from the Shift team.

Shift, which launched in November 2015, was one of a steadily-increasing cohort of cryptocurrency debit cards, with multiple providers now issuing them in various countries.

According to a screenshot of an email uploaded to Reddit and attributed to the Shift team, the BTC debit card program will be deactivated on April 11, 2019.

Shift did not state the reason for the withdrawal of its own product, and cards will continue to function as normal up until the cut-off date.

Shift faced skepticism from the moment of its launch, with Cointelegraph reporting at the time on how industry commentators found it difficult to divine a suitably large target market for the card. To obtain it, users have to already hold Bitcoin in order to pay the $20 issuance fee.

On social media, responses similarly highlighted a likely lack of demand as fuelling Coinbase’s decision.

The exchange continues to expand its business in other areas, last week unveiling a controversial feature allowing users to store the private keys to their cryptocurrency wallets in the cloud.

Product Hunt Lists Educational Binance Academy as Third Most Popular Service

The education platform from Binance launched in December to combat misinformation among crypto users.

Cryptocurrency exchange Binance’s education portal has reached the top three most popular products on Y Combinator-backed exposure platform Product Hunt, the website’s listings revealed on Feb. 18.

Product Hunt, which launched in 2013 to showcase up-and-coming products and services to mainstream consumers, currently holds Binance Academy as its third-highest ranking entity. Other cryptocurrency-related offerings include trading tool Robinhood and statistics and passive income generator Earn.com.

Binance Academy debuted in December last year as a means of providing cryptocurrency traders with information on Bitcoin (BTC) and the cryptocurrency industry in general.

Executives appeared eager to increase technical proficiency among users in the wake of multiple ongoing hacks of exchange platforms.

“Education is the integral pillar to proliferating crypto and blockchain usage,” chief growth officer Ted Lin commented in a press release at the time, stating:

“With Binance Academy, our goal is to provide an entirely neutral platform with quality, unbiased, educational information.”

Binance, which is ranked first on CoinMarketCap for adjusted 24-hour trading volume, is preparing to release a testnet version of a new kind of exchange this week. Binance DEX, a decentralized platform, will allow users to maintain control of their private keys and avoid thefts of funds kept in hot wallets with Binance as a trusted custodian.

Security of cryptocurrency holdings remains a major concern in the community, however, as novice users can fail to understand the implications of using hot wallets over safer options such as hardware devices.

Last week, United States exchange Coinbase caused a rift within the community after it released a tool allowing its Coinbase Wallet traders to store private keys in the cloud. Such a practice, critics argued, would make funds even more susceptible to theft from hackers.

Argo Blockchain Plans to Terminate Mining Contracts, Cut Costs by 35 Percent

The company blamed the continued suppression of Bitcoin prices and associated profitability issues in the mining market.

United Kingdom-based cryptocurrency mining provider Argo Blockchain announced it was refocusing its business as part of a major cost-cutting exercise, according to a strategy update published on Feb. 15.

Argo, which is headquartered in London with facilities in Quebec, said it would terminate its Mining-as-a-Service (MaaS) operations by April, focusing solely on direct mining.

MaaS operators facilitate cryptocurrency mining on borrowed hardware remotely. Explaining its decision, Argo said the ongoing suppression of Bitcoin (BTC) prices and associated reduced profitability of mining had caused it to slim down its expenses sheet.

“The redeployment of the mining infrastructure and capital is expected to be profitable following a material reduction in input costs achieved from suppliers,” the update reads, stating:

“The restructuring measures and strategy refocus are expected to reduce the overall cash burn and deliver EBITDA (earnings before interest, taxes, depreciation, and amortization) break-even in the second half of 2019.”

Along with abandoning MaaS, Argo plans to reduce costs by over a third in order to meet its profitability target.

CEO and co-founder Mike Edwards summarized:

“While it is disappointing to make this shift after delivering better-than-expected growth during our first six months as a consumer business, we need to be prudent and act decisively in order to ride out the downturn and be in a strong position when industry fundamentals improve.”

Bitcoin mining has faced a challenging year, with various companies experiencing problems as a result of decreasing prices. Earlier on Friday, Cointelegraph reported on the latest earnings from Nvidia, the company’s performance having been significantly impacted by the crypto winter.

Nvidia Reports Full-Year Revenue Increases But Q4 Losses After Cryptocurrency ‘Hangover’

The company posted an overall 21 percent annual earnings increase compared to the same time last year.

United States gaming and computer hardware manufacturer Nvidia has reported full-year revenue gains, the company confirmed in a press release about its Q4 earnings published on Feb. 14.

Nvidia, which was one of the companies worst hit by the cryptocurrency market downturn and associated lack of demand of mining components, said its total 2018 revenue climbed 21 percent from 2017 numbers to $11.72 billion.

The growth was driven by all-time high sales of its gaming, datacenter, professional visualization and automotive products.

Nvidia’s shares jumped 8 percent this week on the unveiling of the figures, which nonetheless painted a less buoyant picture of Q4 performance. Revenue was down 24 percent versus the same quarter the previous year to $2.24 billion.

Commenting on the statistics, founder and CEO Jensen Huang underscored the volatility in the market.

“This was a turbulent close to what had been a great year,” he said, adding:

“The combination of post-crypto excess channel inventory and recent deteriorating end-market conditions drove a disappointing quarter.”

As Cointelegraph reported, Nvidia had warned about the impact of mining woes on its bottom line throughout the second half of last year. The hashrate of the Bitcoin (BTC) network has begun improving this year after hitting a trough in early December.

Earlier this month meanwhile, research claimed Nvidia had nonetheless managed to accrue $1.35 billion extra in cryptocurrency revenue than it had previously reporte

US Court Reconsiders Blockvest Acquittal Over Unlicensed Securities Offer

The court had previously claimed Blockvest did not violate securities laws with its BLV token sale.

The United States Securities and Exchange Commission (SEC) announced it had gained an injunction against initial coin offering (ICO) operator Blockvest, overturning a 2018 court order. The regulator reported the development in a press release published on Feb. 14.

Blockvest, which the SEC suspects of offering and attempting to sell unregistered securities via its BLV token sale, will now face fresh charges along with its founder, Reginald Buddy Ringgold, III aka Rasool Abdul Rahim El.

“The defendants used the SEC seal without permission and falsely claimed that their crypto fund was ‘licensed and regulated,’” the release explains, adding:

“Ringgold also is alleged to have promoted the ICO with a fake regulatory agency he created-the ‘Blockchain Exchange Commission,’ with a seal similar to the SEC's and the same address as SEC headquarters.”

In October 2018, the U.S. District Court for the Southern District of California enacted an asset freeze against Blockvest pending review, halting its ICO. As Cointelegraph reported, however, the decision was reversed the following month after the court claimed the SEC had failed to demonstrate that BLV was a security token.

This latest ruling is what the court itself now challenges.

“The court ruled that ‘based upon the additional submitted briefing [the court] concludes that Defendants made an 'offer' of unregistered securities which violated Section 17(a) [of the Securities Act of 1933],’” the release continues, stating:

“The court explained that it ‘determines that the SEC has demonstrated that the promotion of the ICO of the BLV token was a 'security' and satisfies the Howey test.’”

The SEC has vowed to aggressively pursue any entity attempting to sell digital tokens on the U.S. market without the appropriate accreditation. The zero-tolerance stance has received mixed reviews, with some sources concerned about its effect on the growth of the emerging cryptocurrency sector.

JPMorgan Chase to Launch ‘JPM Coin,’ Using Crypto to Speed Settlements

U.S. banking giant JPMorgan Chase will begin conducting tests of its bespoke coin in the next several months, an executive said.

United States banking giant JPMorgan Chase (JPM) is launching its own cryptocurrency in a U.S. banking first, CNBC reported on Feb. 14.

In a move commentators may see as unlikely, the multinational lender will use its newly developed asset, dubbed “JPM Coin,” to increase settlement efficiency, initially within three of its operations.

Speaking to CNBC, Umar Farooq, who leads JPM’s blockchain focus, appeared buoyant on blockchain technology’s perspectives at the bank.

“So anything that currently exists in the world, as that moves onto the blockchain, this would be the payment leg for that transaction,” he told the network:

“The applications are frankly quite endless; anything where you have a distributed ledger which involves corporations or institutions can use this.”

JPM Coin will initially focus on international settlements by major corporations, helping speed up transactions that currently take a day or longer using extant options such as SWIFT.

Elsewhere, treasury services and securities transactions are also in line to benefit, Farooq saying the cryptocurrency could expand further if it proves successful.

Only a small amount of the total funds involved in the three areas would involve JPM Coin at first.

“Even if this was limited to JPM clients at the institutional level, it shouldn't hold us back,” he added.

The banking giant became notorious among cryptocurrency participants in mid-2017, when its CEO Jamie Dimon openly called Bitcoin a “fraud,” comments he later personally refuted to Cointelegraph at the World Economic Forum last year.

Samsung SDS Reveals Blockchain Accelerator Tech Following Hyperledger Testing

New accelerator tool is the latest offering from Samsung SDS and its Nexledger blockchain platform.

The IT arm of South Korean tech giant Samsung announced it had developed technology to speed up blockchain transactions, the company confirmed in a press release on Feb 14.

Presenting at the ongoing IBM Think 2019 conference in San Francisco, Samsung SDS said its new technology, Nexledger Accelerator, had already passed testing with Hyperledger Fabric.

“In order to improve transaction processing speed, which is a key consideration in applying blockchain technology, Samsung SDS has developed its own Nexledger Accelerator, which can be applied to Hyperledger Fabric,” the press release explained:

“Samsung SDS tested the Nexledger Accelerator in Hyperledger Fabric last December and found that the transaction processing speed was significantly improved.”

For the Accelerator, a dedicated Github repository aims to offer developers tools for testing and expanding the technology via a scheme dubbed “Innovation Sandbox.”

“The intent is to enable blockchain developers to run it to see how many performance benefits they can expect in reproducible ways,” Samsung SDS said in the press release.

SDS added it would also be joining the IBM Blockchain Platform Board.

Hyperledger is an open-source enterprise blockchain solution developed by the Linux Foundation. The technology has seen participation from and deployment among major players, including IBM, over the past two years.

Samsung first debuted its Nexledger product, itself an enterprise blockchain platform, in April 2017.

Independent Research Claims to Identify Five QuadrigaCX Cold Wallets

Extensive analysis has drawn fresh conclusions about the defunct QuadrigaCX exchange’s property, but more is required, its author says.

An internet analyst has claimed to have delineated four Bitcoin addresses that belonged to defunct Canadian exchange QuadrigaCX, publishing their findings on Reddit on Feb. 13.

The post, by a user known on Reddit as u/dekoze, indicates five addresses allegedly associated with the exchange, noting that the number is just a fraction of the total number of associated wallets. Transactions sent to the addresses roughly equal the amount of Bitcoin Quadriga previously reportedly sent to locked cold wallets by mistake.

“Notably, every address was inactive since April 2018 and the majority of their received BTC was either directly from the QCX hot wallet or a wallet 1 transfer removed from the hot wallet,” u/dekoze commented, continuing:

“With all this information this we can confirm: These 5 addresses are a portion of the QCX cold wallet addresses.”

QuadrigaCX has been the center of a debacle since its CEO Gerald Cotten died in December. Leaving no indication of the identity of the exchange’s cold wallets or how to access them, Cotten inadvertently left users out of pocket by almost $200 million.

Multiple theories have since appeared surrounding the events, including that Quadriga never had the funds it claimed to and that an unknown party in fact does have access to the cold wallets.

If the latest research is accurate, it will shed new light on the activity involving Quadriga’s wallets.

“At this point, due to plausible deniability and lack of transparency, we have reached the extent of what we (non-law enforcement) can 100% know for now,” u/dekoze summarized:

“With minimal understanding of the BTC blockchain though, there are some big leads we can follow but can only speculate on.”

A court hearing today, Feb. 14, is set to decide which law firms can represent the around 115,000 clients who lost money.

CFTC’s First Published 2019 Examination Priorities Reveal Major Cryptocurrency Focus

Candidates will need to understand areas such as crypto surveillance, trading surveillance and others.

United States regulator the Commodity Futures Trading Commission (CFTC) has announced cryptocurrency will form a priority for its internal examinations this year, according to a press release published on Feb. 12.

The CFTC, which has released its examination priorities for the first time in 2019, will include various crypto-related aspects in its Division of Market Oversight (DMO), Division of Swap Dealer & Intermediary Oversight (DSIO) and Division of Clearing & Risk (DCR) papers.

According to the press release, those priorities pertaining to cryptocurrency include cryptocurrency surveillance practices, as well as other market and trading surveillance including real-time monitoring.

“I commend DMO, DSIO and DCR leadership and staff for their work to bring additional transparency into the CFTC agenda in order to ensure that registered market participants devote adequate compliance resources consistent with our regulatory priorities,” CFTC chairman J. Christopher Giancarlo commented.

The move comes as cryptocurrency regulation continues in earnest both at the CFTC and counterpart the Securities and Exchange Commission (SEC).

As Cointelegraph reported, reviews have been mixed over the approaches of the two regulators, accusations centering on the comparatively heavy-handed approach of the SEC. Others believe the piecemeal issuance of regulations has further repercussions.

“This has hampered innovation and left many American businesses in regulatory limbo, particularly with respect to whether or not their tokens are classified as securities,” former Republican Representative George Nethercutt wrote in an article in January.

Cryptocurrency has already made it onto the radar of certification bodies. In July last year, the CFA Institute confirmed the industry would appear in its own exams in 2019.

A government certification scheme for crypto agents in Malta taken in October 2018 had a reported pass rate of less than 40 percent.

Indonesia: $70 Million Capital Requirement for Bitcoin Futures Sparks Anger

New regulation requires those looking to offer futures trading to have a starting capital of over $70 million.

Cryptocurrency traders are unhappy with regulators in Indonesia after it emerged Bitcoin (BTC) brokers now needed over $70 million to launch futures trading. Local English-language news outlet Jakarta Post reported on the development on Feb. 14.

Following new regulations which came into effect last October, trading platforms wishing to offer cryptocurrency-based instruments can do so, while cryptocurrency use remains banned.

However, in a surprise addition to the final bill, those trading platforms are required to have 1 trillion rupiah ($71.17 million) minimum capital.

This, objectors note, dwarfs the equivalent capital needed to begin trading traditional commodities, which is 2.5 billion rupiah ($178,000).

The addition appeared last week, authored by the Commodity Futures Trading Regulatory Agency, also known as Bappebti.

According to Oscar Darmawan, CEO of local cryptocurrency exchange Indodax, the sums involved are even more than the cost of opening a rural bank. The regulations, he told Reuters, were effectively stifling industry growth, as no futures had launched since the tool was legalized.

Indonesia has shown a highly conservative approach to cryptocurrency in recent times. In June 2018, the country’s finance regulator greenlighted crypto trading as a commodity on Indonesia’s stock exchange.

A full block on Bitcoin use for payments from Indonesia’s central bank came in December 2017, weeks before the cryptocurrency hit its most recent all-time USD high of around $20,000.

Nasdaq to Add Brave New Coin Bitcoin and Ethereum Indices This Month

The company will add the Bitcoin and Ethereum Liquid Indices to its Global Index Data Service (GIDS).

Nasdaq will launch two new indices tracking cryptocurrency prices on Feb. 25, the company announced in an update to its website on Feb. 12.

The indices — the Bitcoin Liquid Index (BLX) and the Ethereum Liquid Index (ELX) — will offer real-time price updates in thirty-second intervals for clients using NASDAQ’s Global Index Data Service (GIDS).

BLX and ELX are the product of United States blockchain and crypto asset market data company Brave New Coin.

“(BLX and ELX) are each designed to provide a real-time spot or reference rate for the price of 1 BTC and 1 ETH respectively, quoted in USD, and based on the most liquid ends of their markets,” Nasdaq explains, adding:

“Both indices are calculated using a methodology that has been independently audited against key IOSCO principles.”

Nasdaq has taken an increasingly hands-on approach to cryptocurrency-related products and services, particularly over the past year.

In September, the company began looking into adding crypto data sets to its market analytics suite after considerable demand. Later, it emerged its own Bitcoin futures would launch some time in the first half of 2019.

In January, CEO Adena Friedman went on record to state her belief that Bitcoin could become a major world currency in future.

Canada: Lawyers to Meet at Nova Scotia Supreme Court Over QuadrigaCX Representation

The $200 million legal proceedings over the de facto defunct exchange have interest from a raft of law firms.

Embattled Canadian cryptocurrency exchange QuadrigaCX has become the subject of a bidding war as lawyers meet to win creditor representation, Bloomberg reported on Feb. 12.

The hearing at the Nova Scotia Supreme Court on Feb. 14 will decide which law firms can lobby for compensation on behalf of clients of the exchange, which currently owes them around $260 million CAD ($196 million).

The sum of $190 million CAD results from cryptocurrency and other deposits which the exchange reportedly lost following the death of its CEO, Gerald Cotten, in December. The ensuing legal action has added another $70 million CAD.

In total, the legal action involves around 115,000 QuadrigaCX users, Bloomberg notes.

As Cointelegraph reported, various rumors continue to swirl over the circumstances behind Quadriga’s demise.

Having previously claimed the client funds were in cold wallets — for which Cotten did not leave behind access information — the exchange’s statements have since been called into question after funds appeared to leave the assumed wallets after his death.

A more recent report suggested the funds were not in wallets at all, but were in fact missing altogether.

Earlier Wednesday, a separate debacle broke out after it emerged executives sent $500,000 worth of Bitcoin to inaccessible wallets by mistake. The blunder came via a report from Ernst & Young, which is in charge of restructuring Quadriga as part of the legal proceedings.

XBT Provider Admits Knowledge Gaps as It Postpones Launch Of Cryptocurrency Basket

CEO Laurent Kssis told Bloomberg the company had no clue about hard forks and related concepts last year.

Swedish Bitcoin (BTC) exchange-traded note (ETN) operator XBT Provider has shelved plans to offer altcoin products due to market volatility, Bloomberg reported on Feb. 13.

Speaking to the publication, XBT’s CEO Laurent Kssis revealed the company did not have an understanding of Bitcoin hard forks and related phenomena when Swedish regulators greenlighted its plans in May 2018.

XBT launched the world’s first regulated Bitcoin tracker, Bitcoin Tracker One, in 2015, and has since added several related products.

According to Kssis, XBT needs to better its knowledge about hard forks and community politics in order to avoid listing a coin which would soon fall out of favor or disintegrate altogether.

“It’s important to ask how the community is responding to the split and who’s going to support one asset versus the other,” he said, adding:

“If we get it wrong, these assets will drop and if they’re part of the basket we can’t go back because it’s in the final term-sheet.”

2018 saw various low-key forks of Bitcoin (BTC), according to data released last month. However, the vast majority of forks occurred around the time of BTC’s all-time USD high in December 2017.

In November last year, Bitcoin Cash (BCH), perhaps the best-known fork of BTC, itself split into two separate blockchains, sparking a continuing publicity war.

Bloomberg notes that XBT intends to wait for the market to settle before revisiting its plans.

World’s 5th Largest Bank Aims to Debut Blockchain Payment Network in 2020

The Global Open Network is a joint effort with a U.S. content delivery and cloud platform company.

Japan’s Mitsubishi UFJ Financial Group (MUFG) has officially announced it will launch a new blockchain-based payment system, according to a press release published on Feb. 12.

The world’s fifth-largest bank is working on the project in partnership with United States content delivery network Akamai, with the aim to launch in H1 2020.

Dubbed the “Global Open Network,” the platform aims to utilize MUFG’s payment industry reach to cement its standing in the increasingly competitive blockchain payments market.

MUFG and Akamai had first announced a partnership in May of last year, issuing an outline of what would become the Global Open Network and setting a launch date for the start of the 2018 fiscal year that has not been realized.

“The new payment network will be a diverse payment service equipped with an interface that can be used as a communications network, and including functions for the transfer and management of value through blockchain,” a press release explained at the time, adding:

“This will allow for a significant reduction of transaction costs for all kinds of payment services, and could support a large expansion in transaction numbers.”

MUFG has embarked on various blockchain endeavors in recent months, among which was an initiative to develop a remittance corridor with Brazil using Ripple (XRP).

Also in May, MUFG hinted it would begin trialling its own cryptocurrency in 2019, having originally revealed plans for its creation in 2016.

Two US Pensions Lead $40 Million Round in Morgan Creek’s New Blockchain Fund

Morgan Creek Digital’s new major funding news follows CEO Anthony Pompliano’s endorsement of Bitcoin’s potential to avert a pension crisis.

United States digital asset firm Morgan Creek Digital has secured $40 million in funding from investors that include two major pension funds, Bloomberg reported Feb. 12, citing a statement from the company.

Morgan Creek Digital, which launched its Digital Asset Index Fund in August last year, sealed the funding from two of the three benefit plans from the Fairfax County Retirement Systems.

The new venture capital fund is called the Morgan Creek Blockchain Opportunities Fund and is reportedly focused on investing in the digital asset industry, according to The Next Web.

The original cap for the investment was set at $25 million, but expanded upwards due to the level of interest, The Next Web reports, referencing the firm’s CEO, Anthony Pompliano.

The agreement with the two funds came prior to the start of the year, when Pompliano issued a blog post about the usefulness of Bitcoin (BTC) in the pensions sector.

“The fundraising for this fund didn’t happen overnight, so it definitely took place before that article was written,” he told the publication.

Little has been made public about the full investor deck in the latest round. Bloomberg quotes the chief investment office of one of the Fairfax pension funds as expressing a similar belief in Bitcoin’s potential.

“It will take time for pension funds to get comfortable with investing in Bitcoin. We need to educate multiple stakeholders and demystify this nascent industry,” Pompliano wrote in his blog post in December:

“When one makes the decision, it will create a cascading effect that leads to hundreds of them jumping in.”

Bithumb Partners With Blockchain VC Firm Nvelop to Launch Exchange in UAE: Report

Together with Nvelop, South Korean exchange Bithumb plans to launch a regulated platform this year, according to local reports.

South Korean cryptocurrency exchange Bithumb will open a new platform in the United Arab Emirates (UAE), local news outlet The Financial News reported Feb. 12.

The UAE-based platform is reportedly to be developed in partnership with Abu Dhabi-based firm Nvelop and will function as a springboard for Bithumb to expand into other countries in the Middle East.

Nvelop itself is a joint project from Abu Dhabi-based E11 Investment Fund and Taiwanese venture capital outfit Trill Ventures Group, Financial News reports. The joint venture was reportedly established to fund and develop blockchain initiatives in the Middle East and North Africa.

“The partnership with Nvelop will enable us to build a foothold in the Middle East as a global exchange,” the publication quotes Bithumb as saying:

“This year, we will diversify into a company centered on overseas business.”

The UAE began signalling a desire for cryptocurrency regulation in 2018, opting for a licensing scheme that should produce its first legally sanctioned exchanges in the first half of this year.

Bithumb joins a steadily increasing trend of major crypto exchanges opting to pursue international expansion plans amid challenging market conditions.

Last week, Bithumb debuted its over-the-counter platform for large-volume traders.

Binance CEO Reveals Testnet Release Date for Decentralized Exchange

Binance DEX will launch a public testnet on Feb. 20, with users invited to submit feedback.

Cryptocurrency exchange Binance will launch a testnet version of its new decentralized exchange Feb. 20, CEO Changpeng Zhao confirmed on Twitter Feb. 12.

Binance DEX, plans for which first emerged last year, aims to provide a decentralized basis for cryptocurrency holders to trade tokens, removing liability and security hurdles associated with traditional, centralized platforms.

The testnet release will be public, with Zhao requesting feedback from users in the same tweet today.  

The date follows previous announcements with more details about Binance DEX, which will include support for cryptocurrency hardware wallets. This feature, Zhao said earlier this month, will allow users to trade while retaining control of their private keys.

Promises of a testnet had circulated since December, with Binance since launching an over-the-counter desk for large volume traders and other expansion features.

At the time DEX was announced, Zhao added that he anticipated it running either in tandem with the original Binance platform or even replacing it altogether, depending on market reactions.

Binance additionally plans to expand into at least two new markets in 2019, a company spokesperson confirmed in January.

General Motors’ Finance Arm Joins Blockchain Data Security Initiative

General Motors Financial is the most recent participant in Spring Labs’ Industry Partners Program.

United States automotive giant General Motors (GM) has become the latest member to join blockchain startup Spring Labs’ partner project to enhance data security, the company confirmed in a press release Feb. 11.

GM, which has experimented with the technology before, will join the Spring Founding Industry Partners (SPIF) Program, which launched in January.

Now with almost 20 participants, the scheme aims to address issues in data provenance through collaborative research.

Spring Labs, as Cointelegraph reported, plans to release its first related products this year.

“As the captive finance arm for General Motors and one of the world’s largest auto finance providers, we are continually innovating and evolving our fraud prevention and detection capabilities to better serve and protect our customers and dealers,” said Mike Kanarios, chief strategy officer at GM Financial commented in the press release.

Quoted by Forbes, Spring Labs’ CEO Adam Jiwan suggested that if successful, further participation could extend to GM’s operations more widely.

Jiwan explained:

“We came together with the view that we could develop a series of use cases that would match some of [GM Financial’s] core business priorities as a lender, or potentially [those of] GM as a parent company.”

The press release also notes that GM Financial is the first to join SPIF.

GM has taken an increasingly active role in blockchain development in recent years. In late 2017, GM Financial became one of the earliest members of Hyperledger, an open-source enterprise blockchain project that has since accrued various well-known names. Hyperledger currently provides the technology behind IBM’s blockchain platform.

Six months later, GM launched its own cross-industry blockchain association along with other major car manufacturers. In December, GM filed a patent on using the technology to handle data, specifically relating to autonomous vehicles.

FDA Commissioner Suggests Using Blockchain for New Supply Chain Open Pilot

The FDA’s supply chain tool is set to begin mainstream operations in 2023, and received Congressional approval in 2013.

The Commissioner of the United States Food and Drug Administration (FDA) has suggested the use of blockchain for an open pilot scheme for the pharmaceuticals industry. The pilot focuses on improving supply chains and was announced in a notice published Feb. 8.

The Pilot Project Program Under the Drug Supply Chain Security Act (DSCSA Pilot Project Program), which aims to ingratiate industry players with emerging innovative technologies, will accept applications through March 11.

The move is an initial step in the development of a digital supply chain platform specifically geared to tracking drugs and preventing counterfeiting, set to operate from 2023. While not confirmed, analogues of such supply chain platforms leverage blockchain technology to improve conventional systems.

FDA Commissioner Scott Gottlieb commented in an accompanying press release Feb. 7:

“We’re invested in exploring new ways to improve traceability, in some cases using the same technologies that can enhance drug supply chain security, like the use of blockchain.”

The DSCSA in fact dates back to 2013, when it — an act that “outlines steps to build an electronic, interoperable system to identify and trace certain prescription drugs” — was signed into law.

“Enhanced verification and tracing in the supply chain can translate to a more rapid response by industry and the FDA when an illegitimate product is found,” the press release added.

The FDA did not mention the desired size or scope of the pilot, nor hint at which specific industry participants, if any, had already expressed interest.

As Cointelegraph reported, the provenance of pharmaceuticals is one of the areas that multiple actors have sought to overhaul using blockchain.

Worldwide, supply chains for a large number of major industries are seeing similar treatment, with some already benefitting from dedicated platforms such as IBM and Maersk’s TradeLens, which launched in August 2018.

US SEC Highlights Dedicated ICO Guide Amid Ongoing Regulatory Debate

The SEC’s brief introduction on ICOs features an overview of issues such as securities registration, financial risk and other obligations.

U.S. regulator the Securities and Exchange Commission (SEC) has reiterated guidelines on initial coin offerings (ICOs) in a tweet Feb. 10, as efforts to formalize the sector continue.

A dedicated section of the regulator’s website now lists five aspects of ICOs the SEC considers essential, as well as a separate section for investors and market professionals.

The content appears to have existed since March last year, with the SEC opting to draw renewed attention to it on social media this weekend.

The material remains perhaps the most accessible publication into the ICO sector yet by the SEC, conspicuously coming in the form of a user guide instead of technical literature.

The five descriptive aspects listed appear to summarize the organization’s current perspective. These include confirmation a token issued in an ICO can be a security in need of registration with the SEC, regardless of how its issuer refers to it.

The guide also makes familiar reference to risks involved for investors and asks them to do their own research before parting with any capital.

“Companies and individuals are increasingly considering initial coin offerings (ICOs) as a way to raise capital or participate in investment opportunities,” a summary of the guide reads:

“While these digital assets and the technology behind them may present a new and efficient means for carrying out financial transactions, they also bring increased risk of fraud and manipulation because the markets for these assets are less regulated than traditional capital markets.”

Last week, SEC chairman Jay Clayton gave substantial testimony about ICOs as part of a hearing on cryptocurrency, similarly underscoring the need for investor protection.

An SEC commissioner, Heister Peirce, said Friday, Feb. 8, that the delay in establishing crypto regulation may allow more freedom for the industry to move on its own.

Nonetheless, the combined efforts come at a time when the ICO industry is now a fraction of its former size in terms of market capitalization. As Cointelegraph reported, some ICO tokens now trade well under their issuance price, while many have lost more than 90 percent of their value.

In December, Arthur Hayes, CEO of Hong Kong cryptocurrency trading platform BitMEX, told Cointelegraph he anticipated an ICO market resurgence by 2020.

Fake MetaMask Crypto Malware Pulled From Google Play After Tip-Off

An app masquerading as DApp MetaMask contained malware that aimed to steal coins by replacing wallet addresses.

Decentralized app (DApp) MetaMask is facing fresh problems from cryptocurrency scammers after malware impersonating the tool appeared on Google Play, cybersecurity company Eset reported Feb. 8.

The malware, which replaces computer clipboard information in an attempt to steal cryptocurrency, was removed by Google at the beginning of the month after a tip-off from Eset researchers.

Known as a ‘Clipper,’ the malware replaces copied cryptocurrency wallet addresses with an address belonging to an attacker in the hope funds will be sent elsewhere without the user noticing.

The discovery marked the first time such malware had made it past Google’s vetting procedures, the security firm notes.

“The clipper we found lurking in the Google Play store, detected by ESET security solutions as Android/Clipper.C, impersonates a legitimate service called MetaMask,” Eset explained, continuing:

“The malware’s primary purpose is to steal the victim’s credentials and private keys to gain control over the victim’s Ethereum funds. However, it can also replace a Bitcoin or Ethereum wallet address copied to the clipboard with one belonging to the attacker.”

MetaMask, which is one of the oldest Ethereum (ETH)-basd DApps, has fallen victim to malicious schemes before.

In July last year, Google developers pulled the app from Google Play altogether, leaving only fake impersonations. A subsequent report from MetaMask revealed the action had occurred by mistake.

In November, MetaMask confirmed its plans to launch a mobile app, which ended up being the target of the latest malware issue.

SEC Commissioner Jackson Thinks Regulator Will Approve BTC ETF, Leaked Interview Shows

A forthcoming interview with a U.S. securities representative sees possible positive news about the future of a Bitcoin ETF.

A Bitcoin (BTC) exchange-traded fund (ETF) will most likely ultimately gain approval from the United States securities regulator, according to a commissioner. The comments were reported by political journal Congressional Quarterly in a forthcoming interview leaked on Twitter on Feb. 5.

Robert J. Jackson Jr., the Securities and Exchange Commission (SEC)’s only Democratic commissioner, said that despite its string of rejections of ETF applications last year, the practice will ultimately change.

“Eventually, do I think someone will satisfy the standards we’ve laid out there? I hope so, yes, and I think so,” he told the publication, according to the reportedly leaked interview excerpt.

Multiple ETF proposals saw consideration by the SEC in 2018, but all of them ultimately received “no” verdicts or delays on the final outcome.

One operator, VanEck, engaged in extensive dialog with the SEC, addressing various worries aired over its product. Last month, the U.S. government shutdown caused the application to be temporarily withdrawn, before making a reappearance a week later.

Discussing previous applications, Jackson meanwhile highlighted an effort for an ETF by Tyler and Cameron Winklevoss in March 2017 as a demonstration of how attitudes were changing along with the market.

When the SEC rejected the twins’ ETF application in March that year, Bitcoin markets saw considerable volatility, a phenomenon which has since markedly decreased.

“There you had a situation where the risk for manipulation and for people getting hurt was enormous. The liquidity issues in the market were very serious,” he continued.

U.S. SEC commissioner Hester M. Peirce has also previously dissented from the regulator’s second disapproval of the Winklevoss Bitcoin ETF in July 2018, noting that the SEC has fundamentally erred with the decision.

Other sources have also said that it is a case of when, not if, for ETF approval in the U.S., — including cryptocurrency advocate Andreas Antonopoulos — but some remain skeptical about its usefulness in the industry.

Texas Securities Regulator Reveals 16 Orders Issued to Suspect Crypto Investments in 2018

The Texas State Securities Board is working with law enforcement to track down crypto scammers, with 60 cited last year.

The Texas State Securities Board (SSB) issued a total of 16 orders against suspected cryptocurrency scam investments in 2018, the regulator revealed in its 2018 Enforcement Report published on Feb. 7.

Targeting actors luring Texas residents with various investment schemes, the SSB said it had successfully cited a total of 60 people and entities over the twelve-month period that reportedly sold unregistered securities.

Scams included the now-infamous BitConnect, an investment racket which lost almost its entire market cap after a string of revelations about its authenticity worldwide.

“Promoters of cryptocurrency-related offerings are taking advantage of the anonymity of the internet to attract victims, weaponizing social media to connect with investors in Texas,” the report reads, stating:

“In 2018, (the SSB) entered 16 administrative orders against promoters of suspect cryptocurrency investments who were using online advertisements, social media, and other solicitations to Collaborative Law Enforcement.”

The report also highlights the increasing partnership activities between the SSB and local law enforcement in tracking down and bringing perpetrators to justice.

Nationwide, the United States continues to crack down on illegitimate offerings involving cryptocurrency and securities. A preoccupation of interstate regulator the Securities and Exchange Commission (SEC), some states have taken a hard line on scams, despite the patchwork regulatory landscape around cryptocurrency more widely.

In April last year, Cointelegraph reported on how the SSB was looking into more than 30 cryptocurrency schemes active within Texas borders.

Winklevoss Twins to Pay Out $45,000 in Legal Fees to Charlie Shrem After New Ruling

The court decision comes after an asset freeze on Shrem was halted in November of last year.

Bitcoin (BTC) entrepreneur and advocate Charlie Shrem will receive around $45,000 in legal costs from Tyler and Cameron Winklevoss as part of an ongoing lawsuit, according to an official document filed on Feb. 7.

The latest step in the lengthy legal proceedings between the former business partners, a judge at the District Court of the Southern District of New York ruled in favor of Shrem for a second time in the last three months.

The Winklevoss twins had instigated an investigation and asset freeze on Shrem after a fallout over money owed from a years-old Bitcoin trade deal.

In November, the court likewise reduced the scope of the Winklevoss’ claims, with the legal fees reimbursement from the process now due.

The lawsuit will now continue covering new ground in June.

As Cointelegraph reported, the current battle is the result of years of suspicion between the Winklevosses and Shrem. The dispute goes back to 2013, when Shrem allegedly did not return 5,000 Bitcoin owed to the twins, but instead, they allege, spent the funds on personal items over a lengthy period.

Shrem’s lawyer has denied these claims.

After serving time in prison for his role in now-defunct marketplace Silk Road, Shrem has returned to the cryptocurrency scene, while the Winklevosses operate their own exchange platform, Gemini.

NZ Police Report Says ‘Excellent Progress’ Being Made in Cryptopia Hack Investigation

An international effort is underway to track funds and perpetrators involved in the exchange Cryptopia’s reportedly $16 million hack.

Police in New Zealand are working with international law enforcement to track down hackers who reportedly stole over $16.1 million from local exchange Cryptopia, the police reported in a press release Feb. 7.

Cryptopia, which suffered an attack beginning Jan. 15 and lasting around two weeks, has lost funds from tens of thousands of Ethereum (ETH) wallets.

After confirming they were investigating the case Jan. 16, police revealed today that they are coordinating an international effort to track both the funds and perpetrators, in a report attributed to Detective Inspector Greg Murton.

“The stolen cryptocurrency is being actively tracked by Police and specialists worldwide due to the nature of the cryptocurrency blockchains being publicly available,” Detective Inspector Murton commented, adding:

“Excellent progress is being made in the investigation and we are working with Cryptopia management plus current and former employees who have been providing valuable assistance.”

The report also notes that the “investigation is expected to take a considerable amount of time to resolve due to the complexity of the cyber environment.”

Murton added investigations at Cryptopia’s New Zealand headquarters would conclude by the end of next week.

As Cointelegraph reported, the hackers appeared eager to liquidate the stolen funds, resulting in preventative measures taken by fellow exchange Binance when it emerged they were attempting to sell the coins on its platform.

At the same time, commentators have voiced doubts over the effectiveness of the police operation, arguing the nature of the hack means it is less likely to result in convictions.

“No one seems to have a clue what's going on. But this hasn't come out of the blue,” local news outlet Stuff quoted Auckland University associate professor of commercial law, Alex Sims, as saying Feb. 5.

State-Issued Digital Currencies Can Squeeze Banks, Says South Korea Central Bank

Consumer trust in CBDCs could spell disaster for smaller private lenders, a new report warns.

South Korea’s central bank issued a warning over central bank digital currencies (CBDCs) a week after saying it would not introduce one itself. The development was reported in local news outlet Yonhap News Agency, Feb. 7.

CBDCs, which are also known variously as state-backed or government-backed digital currencies, involve a blockchain-based version of a country’s fiat currency either replacing or circulating in tandem with paper notes and coins.

A number of governments are currently examining the feasibility of using a CBDC, while South Korea formally decided against the measure in late January.

The decision came as a result of a six-month consultation process from Bank of Korea (BoK).

Now, the central bank has claimed in a report that a CBDC would result in mass withdrawals of funds from private institutions, squeezing liquidity and pushing up interest rates.

“The CBDC is a kind of a BOK-issued bank account. People trust it more than one in a commercial bank,” Kwon Oh-ik, one of the authors of the report explained to Yonhap, adding:

“Demand deposits are one of the biggest sources of loans by banks. When people pull out their money, banks raise rates, or lower the reserve ratio, to secure more funds.”

Seoul has opted not to make significant changes to its stance on cryptocurrency as a whole in recent weeks. Last month, lawmakers similarly ruled out a U-turn over their ban on initial coin offerings in the country.

According to a report from the Bank of International Settlements — an organization based in Switzerland made up of 60 of the world’s central banks — last month, around 70 percent of central banks worldwide are conducting some form of CBDC research as of this year.

Bitcoin, Altcoins Are Vulnerable to New Lows, Fundstrat Warns Clients

The investment firm forecasts trouble from cryptocurrencies based on current short-term trends.

Cryptocurrency markets could soon hit lower lows and continue their record bear market, investment and analysis firm Fundstrat Global Advisors warned in an email quoted by Bloomberg on Feb. 6.

Writing to traders, one strategist at the firm, Robert Sluymer, forecast that on the basis of current performance, there was a chance Bitcoin (BTC) and altcoin prices could dip further.

BTC/USD has fallen around 2.2 percent over the past week to trade at $3,370 as of press time Thursday, as many altcoins have seen bigger drops. Sluymer said:

“The price structure for most cryptocurrencies remains weak and appears vulnerable to a pending breakdown to lower lows.”

Fundstrat is known within the cryptocurrency space for providing some of the more upbeat narratives on the future of Bitcoin in particular. Enthusiasm appeared to wane in recent months, however, with popular senior Fundstrat strategist Tom Lee announcing he would no longer make public predictions about BTC/USD in December 2018.

“We are tired of people asking us about target prices,” Bloomberg quoted him as telling clients at the time, nonetheless adding he thought Bitcoin’s fair value should be worth $150,000.

Belief in a broad market resurgence in 2019 remains patchy among other major proponents. While John McAfee has infamously stuck by his $1 million prediction for next year, cryptocurrency exchange Quoine’s CEO also told Cointelegraph he thinks Bitcoin will break its all-time highs of $20,000 within the next eleven months.