OKCoin Exec Says PayPal Will Boost Crypto Adoption, If Rumors True

OKCoin's COO said a PayPal crypto listing would give the industry vast exposure.

Rumors recently surfaced of mainstream payment giant PayPal adding crypto as an option on its platform. Although he had no additional information on the legitimacy of the rumors, OKCoin COO Jason Lau said digital assets on PayPal would further crypto adoption. 

"When a traditional player like PayPal, who has 325 million users, enters the crypto space, it is sure to have a positive impact in highlighting cryptocurrencies to a big new audience," Lau told Cointelegraph via email correspondence on June 24. 

PayPal rumors and job listings surface

Rumors hit the web on June 22 of PayPal adding cryptocurrencies to its platform. In tandem with the rumblings — job listings PayPal posted on the web searching for crypto and blockchain-related engineers. Little information has been confirmed, however. PayPal declined comment on the rumors, according to previous Cointelegraph reporting. 

Given the fact the public is unsure of a PayPal crypto listing in general, details around specifics on such a listing obviously lie unconfirmed as well. "Whether they are merely giving the customer price exposure or allowing users full on-chain ownership to send to an external wallet remains to be seen," Lau said. 

"Having complete control of your crypto adds a very important level of security and utility to users," Lau added.

People generally start with the basics

Crypto on a mainstream payment giant means exposure. "PayPal adding crypto would bring additional awareness, adoption, and a new low friction payment method for individual users," Lau said. 

At the start, when people hear about crypto, they often become involved through more mainstream, user-friendly and simply avenues. 

"Typically, our users first get initiated to crypto via an app like Square Cash, Robinhood, or now potentially Venmo, and then come to OKCoin to develop and execute their investing and trading plans," Lau said after mentioning OKCoin and other exchanges as more complex, touting added capabilities.   

Lau added:

"As with fiat, investing usually comes after people learn how to acquire, store, and transact an asset. We're excited to see more and more platforms providing users the ability to take that first step into crypto to grow the market."

PayPal is just the latest sign of the growing mainstream crypto interest seen in 2020, which includes mainstream billionaire hedge funder Paul Tudor Jones' dive into Bitcoin investment, and Harry Potter author J.K. Rowling's comments about Bitcoin on Twitter. 

ETH Scalability Isn’t Going to Be an Issue Soon, Vitalik Buterin Posits

Ethereum 2.0 will eventually facilitate up to approximately 100,000 transactions per second.

Ethereum expects boosted transactions per second, or TPS, as the network shifts toward the long-awaited Ethereum 2.0, or ETH 2.0, according to Etheruem co-founder Vitalik Buterin. 

Vitalik says the transition will not be instant

"ETH2 scaling for data will be available before ETH2 scaling for general computation," Ethereum Buterin said in a June 30 tweet.

"This implies that rollups will be the dominant scaling paradigm for at least a couple of years: first ~2-3k TPS with ETH1 as data layer, then ~100k TPS with ETH2 (phase 1)," he noted, adding — "Adjust accordingly."

Essentially, Buterin said the network will not instantly transition into Ethereum 2.0. In mentioning rollups, Buterin refers to a second layer on top of Etheruem as part of the equation, using Ethereum's current base blockchain, then switching to Ethereum 2.0 as a blockchain base. The transition into ETH 2.0 will yield between 2,000 and 3,000 TPS, leading into eventual 100,000 TPS capabilities. 

The great scaling debate

For years the crypto community has debated the topic of scalability. Bitcoin, crypto's leading asset, only touts roughly 7 TPS, while credit cards such as Visa handle about 24,000 TPS on average, leading into comments on Bitcoin's feasibility as a real-world payment option. 

Ethereum has also seen difficulties. The network preformed sluggishly when the blockchain game CryptoKitties hit the internet several years ago. 

Ethereum 2.0, a scaling solution transitioning the network over to proof-of-stake, or PoS, consensus, has been a large topic of discussion in recent months. Last week, Ethereum's blog showed ETH 2.0 updates as the endeavor moves forward. 

Decred Co-Founder Calls PayPal and Crypto ‘An Odd Combination’

Decred's co-founder said cryptocurrencies may not fit PayPal's model.

PayPal could be gearing up to work with crypto assets, according to recent rumblings, although Decred co-founder Jake Yocom-Piatt is unsure of those rumors' validity.

“It's hard to say whether these are rumors or not regarding PayPal accepting cryptocurrencies soon," Yocom-Piatt told Cointelegraph via email correspondence when asked about the rumors. 

The pairing does not seem like a fit

Recent news showed PayPal seeking to fill crypto and blockchain-related job positions, while rumors circulated of the platform listing crypto assets.

Although the addition would bring digital assets greater availability, Yocom-Piatt added that the move would not line up with PayPal's system. "PayPal, specifically, is notorious for depriving its users of access to legitimately-acquired funds on their platform with little to no justification," he said.  

"Users having their funds restricted in this fashion is something cryptocurrencies are designed to prevent, making this integration, if it is indeed in progress, an odd combination," the Decred co-founder noted.

A report several months ago showed difficulties around users' PayPal payments, based on different terms flagging transactions and stalling them. "PayPal, along with its subsidiary Venmo, uses a system that automatically flags keywords in the payment memo field that could indicate a violation of U.S. sanctions," Slate said in the February 2020 article

The scene around such term flagging remains a difficult conundrum, as security and protection remain important, as is monetary freedom. Although not money-related, a similar situation has plagued the crypto-YouTuber community in recent months, as many top channels suffered bans as a result of content flagging. 

Crypto is the opposite

Bitcoin, crypto's pioneer asset, at its core, serves as a method of value transfer and storage, away from governmental control. Users can hold and transfer value themselves, without authorities directly swaying the value of the global, non-governmental asset.

In contrast, payment services such as PayPal use government currencies inside controlled parameters. 

"A fiat payment platform notorious for depriving access to funds would be adding support for cryptocurrencies, which are notorious for have no restrictions on funds,” Yocom-Piatt said following up his comment of crypto and PayPal as an odd mix.

The future will tell whether or not PayPal will add the new asset class. 

New Research Shows Massive Internet Spying, Several Crypto Sites Listed

New findings show a major domain provider as a focal point for massive global spying.

A mammoth global spying and data theft effort currently leaves web surfing citizens at risk, with several Bitcoin and crypto domains included in the mix, according to research from Awake Security. 

At the heart of the problem — a web domain registration company named CommuniGal Communication, or GalComm. "Of the 26,079 reachable domains registered through GalComm, 15,160 domains, or almost 60%, are malicious or suspicious," Awake wrote in a June 18 blog post

A list of sites at risk

Although the nefarious movement uses several different methods, including malware, such activity has passed under the radar of popular security systems, thanks to various tactics, Awake wrote, posting a link to affected domains. 

The lengthy list shows a number of crypto and bitcoin-related domains, including cryptolimited.org, cryptocoiners.net, cryptomoedas.info, bitcoincompass.info and bitcoininvestmentstrategy.info, as well as others. 

The list even included binanceref.info and binanceregister.info, although it is unknown if the two sites are involved with popular exchange Binance. 

Cointelegraph reached out to Binance to see if the domains are at all associated, but received no response as of press time. Updates will come as necessary, pending a response.

Other involved browser antics 

Awake also reported over a hundred cases of issues around GalComm-affiliated nefarious Google Chrome extensions — in just a three-month span.

"These extensions can take screenshots, read the clipboard, harvest credential tokens stored in cookies or parameters, grab user keystrokes (like passwords), etc.," Awake said in the post. 

Awake added:

"To date, there have been at least 32,962,951 downloads of these malicious extensions — and this only accounts for the extensions that were live in the Chrome Web Store as of May 2020."

The movement has its hand in essentially every category, from healthcare to oil, Awake wrote. 

Since COVID-19 prevention measures took flight in mid-March, internet crime has risen across the board. A recent U.S. congressional hearing showed a 75% increase in cybercrime since COVID-19's beginnings.  

Cointelegraph reached out to Awake for additional comment but received no response as of press time. The story will be updated pending a response. 

Cryptocurrency News From Japan: June 21 – June 27 in Review

SBI announced a crypto investment fund, Bitflyer Holdings used blockchain-based voting for a shareholder meeting, and more headlined news from Japan this past week.

This week’s headlines from Japan included SBI announcing a digital asset investment fund, Bitflyer Holdings using blockchain for shareholder meeting voting, Japan's Financial Services Agency warning two unregistered crypto exchanges, a Japanese digital asset exchange self-regulatory group changing chairmen, and Coincheck announcing launch details for its digital shareholder meeting platform. 

Check out some of this week’s crypto and blockchain headlines, originally reported by Cointelegraph Japan.

SBI unveils a crypto investment fund

As an option for individual participants, Japanese financial services entity SBI Holdings expects to form and open Japan's first digital asset fund at some point over the next few months, according to SBI CEO Yoshitaka Kitao.

SBI's daughter company, Morningstar, will head up the asset allocation between the three cryptocurrencies used in the fund — Bitcoin, Ethereum and Ripple's XRP. 

Bitflyer completes blockchain-based shareholder meeting

The parent company of Tokyo-based crypto exchange Bitflyer, Bitflyer Holdings, hosted blockchain-based app voting for its shareholder meeting last week. Built by daughter company Bitflyer Blockchain, the app, bVote, facilitated interaction in the digital shareholder meeting, which yielded attendance from Bitflyer brass and shareholders. 

Japanese regulatory agency warns exchanges

Japan's Financial Services Agency, or FSA, warned two digital asset exchanges for their lack of proper licensing. The two companies, Seychelles-based Bitforex, and U.S.-based Amanpuri, reportedly hosted usage by folks residing in Japan. 

Authorities will take further action if unregistered activity persists. 

Japanese self-regulatory agency gains new chair

Bitflyer executive Kimihiro Mine joined the Japan Cryptocurrency Trading Association, or JVCEA, as its new chairman, tallying the first chairman swap in entity's history. A digital asset exchange self-regulating group in Japan, JVCEA formerly held Money Partners CEO and president Taizen Okuyama as its chairman.  

Coincheck eyes release for digital shareholder meeting platform

Digital asset trading outlet Coincheck expects to see its digital shareholder meeting platform, Sharely, launch later in 2020. With its website now live, the solution facilitates online shareholder meetings, allowing participants the ability to pose queries and vote, or simply view the meeting, depending on the type of each attendee.

Coincheck looks toward potentially using blockchain technology as part of the solution, although it appears as though blockchain is not yet part of the equation. 

Hedera Expands Reach With BRD Wallet Addition

BRD has added Hedera's HBAR coin to its digital asset wallet, in addition to the project's Blockset integration.

BRD recently updated its wallet compatibility, allowing storage of Hedera Hashgraph's HBAR coin. 

"In addition to the integration in the BRD consumer wallet, Hedera’s network data will be supported in BRD’s recently launched enterprise-grade blockchain data integration platform Blockset, which powers the BRD consumer wallet," said a June 25 statement provided to Cointelegraph. 

Blockset aids enterprise endeavors

Aimed at the enterprise sector, Hedera touts itself as a proof-of-stake, or PoS, public ledger ecosystem, according to its website. The technology uses what it calls Hashgraph network consensus. The project's incorporation with Blockset plays on Hedera's enterprise lean.

Essentially, entities looking into enterprise blockchain can harness Blockset's tools for constructing their solutions, making the process simpler then starting from scratch, the statement said. The Hedera/Blockset incorporation involves data visibility, as well as transactions posting on the network.

Hedera's BRD collaboration furthers the enterprise distributed ledger movement

“Hedera’s hashgraph technology is designed to support high throughput consumer and enterprise usage," Hedera CEO and co-founder Mance Harmon said in the statement. "By including HBAR in BRD’s consumer wallet, we are exposing our technology to millions of users globally," Harmon noted.

The CEO added: 

"With Blockset, the BRD team is also making significant inroads as a prominent driver of enterprise adoption. We are excited to be able to leverage the elite Blockset suite of tools as a means of gaining exposure within the enterprise ecosystem.”

The collaboration also works in favor of BRD, giving the company added connections to the enterprise arena, BRD CEO Adam Traidman said in the statement. 

Like a number of outfits seeing a spike in line with the COVID-19 timeline, more than half a million new U.S. customers have flocked to BRD's platform since the pandemic hit the world in March, the statement said. 

Cointelegraph reached out to Hedera and BRD PR for additional details, but received no response as of press time. This article will be updated accordingly should a response come in. 

Coinbase Welcomes Compound DeFi to its Platform

Coinbase has listed Compound's COMP asset.

Coinbase announced support for COMP, the token of decentralized finance, or DeFi, project, Compound. 

"Coinbase customers can now buy, sell, convert, send, receive, or store COMP. COMP will be available for customers in all Coinbase-supported regions, with the exception of New York state," the exchange said in a June 25 blog post announcement. 

The company has listed the token on Coinbase.com, with compatibility for iPhone and Android mobile application usage, the announcement detailed. 

Coinbase Pro already listed Compound 

Built on Etheruem's blockchain, Compound offer's another option for crypto-based lending within the industry. 

Coinbase Pro, the trading arm of the crypto exchange giant, listed COMP on June 23, based on a June 18 announcement.  

Coinbase holds close ties to Compound, as the outfit invested in the project in 2018, and still holds a bag of COMP as of June 25, the blog announcement detailed. 

The post noted:

"Coinbase intends to maintain its investment in Compound for the foreseeable future and maintains internal policies that address the timing of permissible disposition of its digital assets, including COMP tokens."

Foul Play Alleged at Bitcoin.org by the Site’s Long-Time Overseer

A recent message from one of Bitcoin.org's overseers hints at foul play.

Will Binns, one of Bitcoin.org's overseers, said he has lost access to the site, claiming a breach may have occurred. 

"Bitcoin.org, where many people also download the latest version of Bitcoin Core software, is now in danger of becoming compromised, if it hasn't just happened," Binns said in a June 24 Github post.

Bitcoin.org has been in transition

Bitcoin.org, a focal point for Bitcoin (BTC) and blockchain education thought to be an original product of Bitcoin creator Satoshi Nakamoto, has changed hands several times over the last decade since the creator's exit.  

Nakamoto reportedly handed off the site's management to a group of entities. A controversial anonymous character named Cobra has overseen the project for the past several years. He recently stated plans for the project's progressive hand-off throughout this year as he fades out of engagement.   

Cobra takes out Binns

Cobra "has removed my access and seized control of the site and accompanying code repositories," Binns said in his June 24 post. "I do not believe Cobra is the sole and lawful owner, nor does he have any right to do these things without just cause."

Cobra removed Binns from the operation due to stated inadequate work, Binns wrote, claiming that the accusations are false. "This has been taken out of context in an attempt to manipulate public opinion and infringe upon my rights, along with the rights of others," Binns said. "I believe he is looking to illegally transfer ownership of the site without due process, and this may only be the beginning."

Binns' post seeks to garner support from the community around the recent developments in an effort for legal action, he said, adding that capital associated with the project has been safely delegated, although the website itself still reportely remains at risk.  

Greg Maxwell chimes in

Greg Maxwell, a long-time Bitcoin developer and crypto community participant, commented on Binns' post. "Your position appears to be a misplaced and inappropriate response to cobra-bitcoin suggesting that he was considering not handing you unilateral control of Bitcoin.org," Maxwell said. 

Maxwell added:

"In particular, no urgent handling is required because fundamentally nothing has change: Cobra currently retains actual control over the domain, as he has for years since long before your involvement, a fact which you have raised no complaint about until now."

Maxwell said Cobra contacted him on June 24, essentially clarifying that Binns is not Bitcoin.org's owner. Cobra also reportedly said he feared Binns presented himself as an owner and capable seller of the website, in part or in whole. 

At first glance, Maxwell said he saw the claims as a tad dramatic. Binns' response, however, changed Maxwell's tune as he now agrees with Cobra's fears. 

Maxwell said:

"I still think that it's likely mostly a misunderstanding fuelled by high emotions (and Cobra's sparkling bedside manner)... but publicly soliciting funding for a legal attack is essentially validating the least chartable interpretation of your actions."

The Bitcoin developer concluded by asking Binns to revisit the situation with a clearer head after some time and thought. 

Sweden’s Central Bank Releases 98-Page ‘Economic Review’ Devoted to CBDC

Sweden's central bank just released a massive report on central bank digital currencies.

Sveriges Riksbank, Sweden's central bank, took a 98-page deep dive into central bank digital currencies, or CBDCs, referencing the country's own such asset — the e-krona. 

"The second issue of Sveriges Riksbank Economic Review in 2020 has a special theme, namely central bank digital currencies (CBDC) and the e-krona," Riksbank's June 18, 2020 report said in an initial note to readers. 

Sweden's interest is not new

In December 2019, Sweden unveiled intentions for a pilot program around its e-krona, in collaboration with Fortune Global 500 company Accenture.

The new report from the country's central bank referred to its 2018 Economic Review detailing the e-krona and its progress. "Riksbank has since continued to delve into various aspects of CBDC, both from an analytical and a practical perspective," the 2020 report said. "Some of this work is summarized in this issue." 

The new edition addresses a number of CBDC aspects

Riksbank's 2020 Economic Review includes reasoning behind a Swedish CBDC, listing monetary issues in the country, as well as other drivers. 

The report also covered other points of consideration, including inquiry on such a currency's necessity, competition and other aspects. 

The review only includes one direct reference of blockchain, seen in a footnote on page 89, which reads:

"An open DLT network is associated to several disadvantages; every transaction must be verified by every participant (cf. blockchain) in a time and resource consuming manner. The responsibility for the Riksbank regarding AML, KYC & CTF could be indefinite. Fraud and cyber-attacks are hard to prevent in an open network."

The report does, however, mention distributed ledger technology, or DLT, several times. 

After coronavirus measures took flight in March, the U.S. proposed a digital dollar, although such a dollar did not include blockchain or DLT

Cointelegraph reached out to Riksbank for additional details, but received no response as of press time. This article will be updated accordingly should a response come in. 

Is Mobile Decentralized Exchange Trading Riskier? Komodo’s CTO Says Not Necessarily

Security for mobile decentralized exchange usage depends on several factors.

Using a decentralized exchange, or DEX, on a mobile device does not necessarily make for greater hacking risk, according to Kadan Stadelmann, CTO of blockchain platform Komodo. 

"I don’t think that the risk to a mobile DEX is necessarily higher than that of a DEX accessed through another medium," Stadelmann told Cointelegraph. "The risk would vary depending on the user’s device, OS [operating system], version, etc.," he added.   

DEX built on Komodo

Constructed on Komodo's network, AtomicDEX is a decentralized exchange working with multiple blockchains, in contrast to other DEXs that only host tokens based on one chain. The DEX on Komodo facilitates peer-to-peer, or P2P, trades across blockchains, called atomic swaps. 

AtomicDEX gears itself toward the mobile user base. As Stadelmann claimed, mobile-based DEX usage does not necessarily mean lessened security. 

Hacking is still possible on mobile

Security breaches still occur on mobile devices, however. Visiting certain websites might increase users' odds of suffering a hack, Stadelmann said, mentioning underground gambling websites as an example. 

"Basically, user behavior is a significant determining factor when it comes to risk," he explained. "Furthermore, there’s the question of whether or not the DEX technology used is genuinely solid and secure," he added. "In this case, it is less about the actual physical device and more about the software and users’ environmental circumstances."

A big topic of discussion, hacks and data leaks have been on the rise since coronavirus took over in March. Nefarious actors have stolen thousands of users' Zoom data. The FBI also noted online illegal activity increased by 75% after the global outbreak began. 

Digital Assets Data CEO Weighs in on Bitcoin’s Mining Difficulty

Bitcoin's mining difficulty recently spiked, while miners hold larger piles of Bitcoin than usual.

Recent findings from analytics company Digital Assets Data show miners hanging on to their Bitcoin (BTC). 

"Rolling MRI (Miner's Rolling Inventory) has declined significantly since the halving, meaning that miners are holding onto more BTC than they are mining, despite the (presumed) increased costs of the added hash power to the network," Digital Assets Data CEO and co-founder Mike Alfred told Cointelegraph on June 18. 

Image courtesy of Digital Assets Data

Bitcoin difficulty pushing network highs

The network mining difficulty of crypto's largest asset recently surged to unusual heights. This essentially means Bitcoin miners are spending an increasing amount of time and effort running the blockchain while seeking their payout, or mining reward. 

"We just saw the single largest upwards mining difficulty adjustment ever, and are now at close to ATH [all-time high] hash rate levels despite the lower block reward," Alfred said on June 18.

Image courtesy of Digital Assets Data

Less selling could mean less available supply

Known for its Bitcoin-backed investment trust under the ticker GBTC, Grayscale has bought up a considerable amount of Bitcoin in recent weeks. Late May reporting showed the entity purchased 50% more Bitcoin than the total amount the market mined since the asset's halving in early May.  

Miner's pocketing more of their Bitcoin rewards, combined with Grayscale's Bitcoin accumulation, could mean less Bitcoin available on the market for interested buyers, Alfred explained. 

Zooming out to a high level vantage point, Alfred noted:

"In my opinion, the global macro backdrop remains fundamentally bullish. While it's always possible to see lower prices in the very short-term, I'm highly confident that prices will be higher 12-24 months out."

The CEO also said he expects bullish outcomes for assets that do not reflect the success of their underlying projects. "I'm extremely bullish on protocols like Horizen (ZEN) that have been making huge progress on innovative technical development but have tokens that remain undervalued relative to that progress," he explained. 

Bitcoin has traded largely sideways for the last several weeks, amid multiple bullish factors. Even rumors of PayPal compatibility were not able to push the asset out of its sideways price action.  

WEF Says Complete Blockchain Overhaul Unlikely

The WEF's blockchain project lead said the technology has its place, but likely will not takeover as the underpinning of all systems.

Ashley Lannquist, blockchain project lead for the World Economic Forum, or WEF, explained blockchain has its use cases, but the technology is not without limitations. 

"I think it is unlikely that blockchain technology will become the underpinning technology of all systems in the future," Lannquist told Cointelegraph. 

When asked about blockchain adoption's biggest roadblock, she explained:

"Because of the trade-offs associated with blockchain – including capabilities as well as limitations and downsides – it has not been easy to identify many high-value use cases. This is probably a significant roadblock to adoption."

Blockchain has aspects useful for fighting corruption 

The WEF recently released a report detailing its experimentation with blockchain technology in fighting public sector corruption. The report pointed out the tech's decentralization and immutability, among other strengths against corruption. The WEF works in joint collaboration with multiple other entities for the project.    

Free from centralized control, blockchain holds potential for transactions, as well as direct data management and documentation without middlemen, Lannquist said. The WEF's endeavor looks at enhancing governmental transparency with blockchain — a technology that, by nature, makes corruption more difficult, as well as more obvious.  

"Corruption is a high-potential space for blockchain because you really benefit from decentralization; records are very difficult to remove or censor, for instance," Lannquist said. 

Blockchain's ability is not limitless

As many mainstream enterprise giants look at harnessing blockchain's power for use cases such as supply chain management, the technology still holds limitations, Lannquist explained. The WEF's project encountered a few such boundaries.

Lannquist detailed:

"These include challenges related to scalability, anonymity, governance (e.g. it is harder to fix bugs and change network software across a decentralized network), the presence of new or different security risks and attack vectors (e.g. 51% and double spend attacks), and slower transaction verification speeds compared with centralized database systems."

Only approximately 11 years old, blockchain and cryptocurrencies still wade through the waters of infancy. The internet itself also underwent similar growing pains in its route toward the impact it holds today. Will blockchain technology see a similar future?

Bitpay Accepts Company of the Year Accolade

Bitpay wins Company of the Year Award from market research company.

Digital asset transaction platform, Bitpay, has won the Frost & Sullivan Company of the Year Award in the alternative payments category.

"Bitpay is a true industry leader, delivering best practices in growth, innovation, and leadership," David Frigstad, Frost & Sullivan's chairman, said in a June 23 statement

Frost & Sullivan is a notable market research company that is over 50 years old.  

Ethereum Update Indicates 2.0 Still Coming Along

Ethereum's blog shows ETH 2.0 still chugging along with developments.

A recent post on Ethereum's blog shows the network's version 2.0 is still coming, noting several developments since its last update.

"Aside from written updates [...] and other public summaries, client teams, contributors, and community members/prospective-validators have been busy," said a June 23 post on the Ethereum blog.

Ethereum 2.0 still en route

A long time coming, Ethereum 2.0, or ETH 2.0, still has not yet gone live with the network's transition into proof-of-stake, or PoS, consensus. 

The network's blog posted its 12th ETH 2.0 update recently, stating a team hard at work. The update showed a number of main developments, including "new Solidity deposit contract formally verified and added to the bounty program," as well as another Altona testnet version, v0.12, likely hitting at some point over the next several days, the blog post said.

Other details included "continuation grant to Sigma Prime for beacon-fuzz to find all the bugs."

The Hard Truth About Trading — Can the Average Joe Succeed?

The ins and outs of trading, as explained by Bill Hermann, Matthew Ficke, and David Carman.

Crypto trading is a zero-sum game with clear winners and losers.

This competitive stage yields countless self-proclaimed profitable traders on Twitter and YouTube. As the players downtown make their livelihood trading for institutions like Galaxy Digital and Pantera Capital, how do their strategies compare to those of retail home-based traders? Do retail methods even work?

“Broadly speaking, larger institutions are mostly directional agnostic and generally focus on market making,” Bill Herrmann, CEO of investment firm Wilshire Phoenix, told Cointelegraph.

By directionally agnostic, Herrmann means institutions do not trade based primarily on direction. Directional trading refers to placing trades on the long or short side — essentially betting on the market going up or down. In contrast, non-directional trading strategies take advantage of various trading products, bots and other aspects to make money outside Bitcoin’s up or down movements. Retail trading often involves a notably different approach. Such traders are often largely on their own to learn and find success.  

Most traders fail

Crypto trading is like mainstream stock, futures and forex trading in a number of ways. Participants use price charts, indicators and fundamental drivers for trade rationale, sculpting trading strategies after hours of testing.

“Profitable day traders make up a small proportion of all traders — 1.6% in the average year,” according to a Tradeciety article, citing data from the book Do Day Traders Rationally Learn About Their Ability. “However, these day traders are very active — accounting for 12% of all day trading activity.” 

That said, trading is very difficult. Unlike sports and other events, when people conduct trades or investments, they enter into a ring against the best professionals in the industry. A similar analogy sees an average Joe stepping off the streets straight into an NBA game. The outcome would not end well for Joe. 

Trading has changed since the crowded city-based rooms portrayed in movies

“Regarding retail traders, I think very few of them are really successful,” David Carman, former Chicago Board Options Exchange pit trader and co-founder of tech hub FinTank, told Cointelegraph. 

“Most floor traders were unable to transition successfully from the pits to electronic trading,” Carman explained. “With few exceptions, they’re all gone,” he added. “The benefit of trading in a pit was leaning on the brokers. You lose that edge trading electronically.”  

Gone are the days of crammed trading floors hosting participants yelling for trades. Floor trading needed brokers on the floor, entering and exiting positions for traders at their command. Knowing the broker well was an edge on the competition. As trading turned digital, that edge disappeared.  

The equipped professionals against the self-taught masses

Institutional traders essentially place orders on behalf of other people or companies, using funds allotted to them by those entities. These traders oversee large sums of capital, having the guidance, tools and technology of the company for which they work. On top of that, these firms often recruit battle-tested traders with proven track records of success, or bright, gifted individuals holding significant programming knowledge just entering the field. 

On the other side are retail traders. This population consists of anyone with an internet connection, money to invest and a jurisdiction that allows it. The barrier to entry for crypto trading is many times lower than traditional market trading. Users can easily jump from exchange to exchange, funding their endeavors with cryptocurrencies or bank account transfers. 

These folks are mostly individuals looking to make extra money for themselves, controlling their own capital. A plethora of trading tactics and knowledge lives online and in books, available to any motivated self-starter. Trading classes also exist online, but the web is muddied with false information and self-proclaimed experts selling information that may or may not prove effective. 

Even with the best information, trading still boils down to personal fit. What may work for one person may not work for the next. It’s a battle of emotion, discipline and organization. 

Institutions and traders with significant capital trade differently

Institutional traders, by nature, must trade differently as they deal in large order sizes. They cannot simply buy any given asset at the current market rate without moving that asset’s price a fair bit.

Herrmann’s comments show these traders taking a different approach than retail traders, who often bet on the market going up or down. “Retail tends to trade with a directional bias and typically deploys popular momentum based strategies, indicators such as RSI and Stochastics,” Herrmann said referring to popular technical analysis charting tools. 

He added:

“This is a good way to get a quick view of the market and can be quite useful for spotting divergences, but including these indicators on one chart, as many retail traders do, is a mistake – basically each one is telling the same story.”

Technical analysis indicators come in many shapes and sizes. Different categories of indicators exist for gauging factors such as volume, momentum and time. As Herrmann mentioned, using multiple different indicators of the same type, at the same time is less effective because they all show similar conclusions, composed in a slightly different manner. 

Retail traders selling their methods

In many instances, retail trading involves a number of different charting indicators, patterns and techniques. These methods may or may not work depending on how they are used. A large number of paid educational groups, online classes and YouTube videos teach these methods, but which of these can you trust?

Each approach and tool varies based on the trader, usually only giving that trader a higher percentage of success on any given trade, depending on the factors taken into consideration. Such tools are by no means a guarantee of success.

Herrmann said: 

“The practice of selling indicators or even strategies has gotten out of control with many websites making outlandish claims about how easy trading is or some promising completely unrealistic returns. There is no magical technical indicator, but that’s not to say that retail traders cannot make money – it’s just a lot of hard work, but stick with it, and develop your own edge.”

According to Herrmann, institutional traders do not use the same charting strategies and indicators seen in the retail herd. He said the difference is “like night and day.”

Institutional players trading directionally on behalf of funds combine several different factors, including momentum, price and volume for their trades. Simply weighing one metric or tool is not effective, giving the trader only a partial view of the market state. Using indicators or market aspects together, however, yields vastly different outcomes. “It does not matter if you're institutional or retail – the result is extremely powerful analytical tools,” Herrmann explained. 

Retail trading can be effective

It is possible to make money with retail trading, but that is easier said than done. Although he did not mention the same aspects as Herrman, CNBC Africa crypto analyst and Twitter personality BigCheds laid out a few other important tactics in retail trading. 

“The key to successful crypto retail trading is risk management,” he told Cointelegraph. Managing risk involves a preset plan detailing the amount a trader can lose on any given trade, while still keeping on pace with his or her odds of success for future trades. 

According to BigCheds, planning and discipline are two other keys to success. “Entering a trade with a plan, sticking to the plan and sticking to your stop-loss and profit taking levels,” all hold as winning elements, the analyst said. “When the trade is over, using a trading journal to learn from experience is a critically important step as well.”

“Also luck helps,” he added.

Public traders need discipline

Winning in the game of trading requires discipline, said OKCoin Head of Market Development Matthew Ficke. “Repeated success requires preparation. New traders can easily get caught up in the emotion of the market, and make poor decisions as a result.” He added:

“Experienced traders define a strategy and risk management parameters before entering a trade. They study the market, find their ‘edge’ and exploit it repeatedly. Professionals create structure for each individual trade.”

Ficke explained a simple example in which a person goes into a long position (they buy into an asset or trading product) at a planned level. They then input a stop-loss order and a profit-taking sell order at predetermined levels, leaving the trade to play out. The trade either hits the target or loses a set amount of money determined by the stop-loss. 

Barring a notable alteration in market conditions, which might call for trade reevaluation, disciplined traders hold to their system, ultimately voiding distracting noise from the equation, Ficke explained. Risk amounts also play a role. If traders risk less than they plan to make on each trade, it can give more room for losses factored into a system.

“By applying structure, the trader’s performance over time is more predictable and sustainable, while they can isolate the part of their process that requires improvement to increase their returns,” Ficke said, adding:

“These principals are the same for traditional and crypto markets. Success requires time, effort, research and structure. Different personalities tend to gravitate towards different types of trading strategies. In that sense, the 'edge' building element of trading is personal and dynamic over time.”

As cryptocurrency in general continues its path of mainstream adoption, many new participants may try their hand in trading the asset class. Achieving success in most areas of life requires hard work, discipline and learning, matched with a bit of natural ability or affinity. Trading appears no different.

Barstool Sports Founder Holds to 2017 Stance on Bitcoin

Barstool Sports founder Dave Portnoy said he still sees Bitcoin the same as he did in 2017.

Barstool Sports' millionaire founder, Dave Portnoy, recently re-tweeted his 2017 video on Bitcoin, saying his view on the asset has not changed. 

"For everybody trying to get me in the Bitcoin game, I made this video in 2017," Portnoy said in a June 19, 2020 tweet. "I still feel this way."

Portnoy's 2017 sentiment

Active on social media, Portnoy has made noise since the start of the COVID-19 pandemic for his comedic stock day trading videos, in which he alludes to his lack of market prowess. 

In his 2017 video, Portnoy said he was a "Bitcoin investor" that year, due to the hype around the asset at the time. Most of the video includes Portnoy explaining his confusion on the asset, its ecosystem and its underlying technology.  

Portnoy said:

"I don't know how to spend em. I don't know how to get em. You gotta go to this think called Coinbase, which is how ya buy em and they keep shuttin down because too many people are trying to buy Bitcoin. The whole thing is run by the Winklevoss twins." 

Portnoy then proceeded to call Bitcoin a scam, although he did say he wanted involvement so as not to miss out on all the gains boasted by those around him. 

"Ok I’ve decided I like you even though I think you and your brother are robots," Portnoy said in a June 20 tweet referring to Tyler Winklevoss. 

Bitcoin has garnered multiple other comments this year from mainstream personalities, including Harry Potter author, J.K. Rowling

Cryptocurrency News From Japan: June 14 – June 20 in Review

A new report on Japanese crypto regulation, an institutional crypto custody service, and more headlined news from Japan this past week.

This week’s headlines from Japan included research company Xangle releasing a report on Japanese crypto regulation, Binance supporting Japan's language but not its residents, SBI Holdings turning gift certificates digital with blockchain, and Nomura Holdings opening a crypto custody service with Ledger and Coinshares. 

Check out some of this week’s crypto and blockchain headlines, originally reported by Cointelegraph Japan.

Research outfit details Japanese crypto regulation

A new report surfaced last week from research outfit Xangle regarding Japanese digital asset regulation. Citing multiple examples of already-approved assets listed on exchanges, the report "analyzes the conditions necessary for listing a new virtual currency in Japan," Cointelegraph Japan detailed. 

The report also noted regulation from the country's Financial Services Agency, or FSA, against gambling decentralized applications, or DApps, as well as several other points of importance. 

Binance brings back Japanese language support

After banning the Japanese region from trading on its exchange in January, Binance mentioned the return Japanese language functionality last week. The platform, however, still denies Japanese residents from using the platform. 

"Intended as a service for Japanese-speaking users who do not live in Japan," Binance told Cointelegraph Japan. 

SBI Holdings underpins gift certificates with blockchain 

The Ukiha Chamber of Commerce, of the Fukuoka Prefecture, unveiled plans to turn local paper-based gift certificates digital, using blockchain as the underlying technology. The product will use a mobile app and QR code. 

Japanese finance company sets up crypto custody with Coinshares

Digital asset management company CoinShares, in collaboration with finance firm Nomura Holdings, opened a custody operation involving crypto. Known as Komainu, the custodial service holds and protects institutions' crypto, Reuters Japan said in a June 17 brief. The service also involves hardware wallet provider Ledger. 

The collaboration first unveiled its regulatory-approved service in 2018, following up with several test clients in recent months. As of the announcement, the operation is ready for more customers.  

Gold Bug Schiff Calls Bitcoin Fiat Following Fed Comments

Peter Schiff agrees with the Fed that Bitcoin should be classified as fiat currency.

Economist, financial commentator and gold advocate Peter Schiff once again bashed Bitcoin in a tweet, essentially calling it fiat currency — the name for regional currencies, such as the U.S. dollar. 

"The Fed gets Bitcoin right," Schiff said in a June 20 tweet, adding:

"It categorizes it with fiat, in contrast to gold that has real value. It sees nothing new in Bitcoin, just in the way it's exchanged. As confidence in both traditional and crypto fiat is lost, savers will return to gold."

The U.S. Fed classified Bitcoin fiat

In a June 18 post, Liberty Street Economics, a blog under the purview of the Federal Reserve Bank of New York, posited Bitcoin and other cryptocurrencies are simply cash in a different form, not a "new type of money" as the crypto industry states. 

The article pointed toward the difference between money itself, and the way in which people transact or use it. "The ability to make electronic exchanges without a trusted party — a defining characteristic of Bitcoin — is radically new," the post said, adding:

"Bitcoin is not a new class of money, it is a new type of exchange mechanism, and this type of exchange mechanism can support a variety of forms of money as well as other types of assets."

Peter Schiff often favors gold

After a number of comments on the subject, Peter Schiff has become known in the crypto space as someone who takes gold over crypto any day. 

After bashing Bitcoin as a store of value in Feb. 25, 2020 tweet, Schiff said: 

“Bitcoin hasn't been around long enough to prove anything other than P.T Barnum right. There's a sucker born every minute and many of them own Bitcoin." 

In April 2020, the economist also projected soaring gold prices and plummeting Bitcoin value for the years ahead. He also called Bitcoin investors fools in March. 

U.S. SEC Chair Clayton Nominated to Oversee Crypto Regulatory-Heavy NY

Latest news shows an intended bid for Securities and Exchange Commission, or SEC, chairman Jay Clayton as New York's Southern District attorney.

United States Attorney General William Barr announced that President Trump will most likely task Jay Clayton as the legal enforcer for a chunk of New York — a state that has historically held a heavy-handed regulatory stance on crypto. 

Barr said in a June 19 statement from the Department of Justice, or DoJ:

“I am pleased to announce that President Trump intends to nominate Jay Clayton, currently the Chairman of the Securities and Exchange Commission, to serve as the next United States Attorney for the Southern District of New York."

Laden with legal battles and regulation

Over the course of crypto's 11-year history, New York has shown a stiff regulatory atmosphere for the developing industry. The state's financial services department put the BitLicense into place in 2015, forcing crypto-related company compliance under stringent guidelines. The region has made a name for itself as a difficult garden for crypto growth.  

The Southern District of New York, or SDNY, in particular, has hosted a number of crypto-related legal battles in recent years. The list spans an array of categories, including the court case of Ross Ulbricht — the man behind the Silk Road black market, which allowed payment in digital assets. 

Barr touted Clayton as a fit for the region's attorney role, given his past work. "His management experience and expertise in financial regulation give him an ideal background to lead the United States Attorney’s Office for the Southern District of New York," Barr said in the statement.  

Clayton has spoken a lot on crypto as SEC chairman

Over the past few years, Clayton has made numerous headlines in relation to digital asset regulation. In one of his most recent statements, the SEC head spoke favorably on the industry's underlying blockchain technology in December 2019.  

In August 2019, however, he showed his unwillingness to bend when it came to guidelines around crypto assets. 

In an interview with Bloomberg, Clayton said:

"I think a lot of people got excited that somehow we would change the rules to accommodate the technology and they invested their time and effort thinking that would happen [...] I have been pretty clear from the start, that ain’t happening."

In September 2019, Clayton also expressed the need for tighter Bitcoin regulation if the asset wants a listing on mainstream exchanges. 

Land Rover Car Company Acknowledges Historical Significance of Bitcoin Network

In a walk through history, major car giant Land Rover noted the creation of Bitcoin's network as a significant moment.

In a recent advertisement, the United Kingdom, or UK, branch of car giant Land Rover laid out a number of significant historical landmarks, including Bitcoin among the mix. 

In an advertisement shaped as a walk through history, Land Rover's video labeled a number of groundbreaking historical developments. Posted by the company's United Kingdom branch in a June 17 tweet, the ad included Bitcoin's network creation as a major mark in history. 

The ad cruises through history

Starting with the first heart transplant in 1967, the ad glided through years of history, mentioning happenings such as olympian Mark Spitz and his seven hold medals in 1972, as well as the launch of MTV in 1981 and the Berlin Wall's demise in 1989.

Going into the 2000s, the ad said: "Bitcoin network is created," under the year 2009.

Land Rover's ad shows yet another sign of growing mainstream Bitcoin awareness

Robinhood Temporarily Down for the Count

User-friendly stock and crypto trading app, Robinhood, has reported its services are down.

Robinhood, a stock and crypto trading application known for its mainstream appeal and simplicity, recently reported significant platform outages. 

Robinhood announced "experiencing a major outage in equities and options trading, as well as degraded performance in cryptocurrency trading" on June 18, a Reuters report detailed. 

Reuters reported a note on Robinhood's website, stating: “We’re currently experiencing issues with our services and are investigating the issue.” By press time, however, Cointelegraph staff could not locate such a statement on Robinhood's page.

Robinhood appeals to the masses

Robinhood offers the public a simple avenue into the stock and crypto investment world. The platform touts no fees. Over the last couple of years, the platform has added various cryptocurrencies to its platform, pushing the industry further into the mainstream.

Robinhood, as well as other similar platforms, have seen an influx of activity and users recently, a June 12 CNBC report detailed.

This outage is not the first of its kind for Robinhood. The retail-friendly platform has suffered multiple other difficulties this year, included an outage just a few months ago.  

Binance CEO CZ Explains Why He Disabled Twitter Comments

Binance CEO Changpeng Zhao recently restricted the ability to comment on his Twitter posts, but only partially.

Known for his social media-involved leadership of crypto exchange giant Binance, CEO Changpeng Zhao, or CZ, said he disabled Twitter comments on his posts to weed out the scammers. 

"To better respond and engage," CZ told Cointelegraph he partially disabled the ability for the public to comment on his tweets. "This is a new feature from Twitter," CZ said on June 11. "It seems it’s only rolled out to a small percentage of people."

Social media holds crucial in crypto

As an industry based primarily on digital technologies, much of the crypto and blockchain community interacts daily on various social media platforms such as Twitter. CZ upholds a significant presence on Twitter, allocating roughly 20% of his time to community interaction on the platform.

In light of Twitter's new option, CZ expressed enjoyment in testing fresh functionalities, describing himself as an early adopter, hence his recent experimentation with comment disable setting.  

Twitter hosts a difficult environment at times

"Twitter is not a perfect platform by any means," CZ said, noting that scammers, trolls and the like can make genuine community interaction difficult on the platform. 

"To clarify, my intention for using the new 'people you follow can reply' feature is not to cut off people’s opinions," CZ said. "I welcome people to voice how they are feeling and also challenge me or our services so we can be better."

CZ said he wants the community to keep suggesting follow-worthy Twitter accounts. "There’s a lot of great voices in the crypto space that I hope to capture more."

Under CZ's purview, Binance has become one of the largest companies in the industry, with more than 1,000 employees. Cointelegraph's list of the top 100 people in crypto and blockchain shows CZ as the most influential person in the industry. 

Mysterious ETH 2.0 Staking Solution Author Claims No Pursuit of Glory

Recent comments from anonymous Ethereum 2.0 staking solution creator heyheeyheeey show his desire for continued anonymity.

An anonymous blockchain industry participant going by the name heyheeyheeey recently dropped an Ethereum 2.0 (ETH 2.0) staking solution on Medium in Satoshi-like fashion. The pseudonymous character did not do it for the fame, according to his recent comments to Cointelegraph. 

"The only thing that I'd like to clarify is that I wasn't paid, but I wasn't looking to get paid either," heyheeyheeey told Cointelegraph staff in a message. "For me it's a portfolio piece," they said, adding, "Unsolicited designs are very common in UX/UI design."

The person's solution aims for scaling improvement

With the public awaiting the release of Ethereum 2.0 — a much-anticipated scalability network upgrade ushering in Proof-of-Stake consensus — heyheeyheeey posted his own scaling solution for the upgrade in a Medium article. Built on a wallet called Argent, the solution aims for speed and simplicity.   

Heyheeyheeey explained:

"Argent are on top of their game, and I'm sure they are really interested in helping staking adoption one way or another. I hope my design inspires other wallets, or community actors to get involved and create staking options that are more accessible to the everyday user."

"The Ethereum open-source design community is not very large yet, but I'm sure it's coming," they added.  

The author keeps a low profile

As of press time, heyheeyheeey's medium profile boasts a modest 103 followers, showing just one blog post. The profile has gained 86 followers since the ETH 2.0 staking solution post. 

"I try keeping an anonymous presence online. I feel better that way," heyheeyheeey said. "With this depth it's the first time I contribute on any project, but I have been a member of the community for five years."

The aspect of anonymity in general dates all the way back to crypto's beginning in 2008, when Bitcoin's anonymous creator, Satoshi Nakamoto, unveiled the asset's framework several months before its launch. 

American Gaming Association Urges Policy Change on Digital Payments

The American Gaming Association has laid out a proposal of new guidelines for gambling payments.

The culmination of a year and half of work, the American Gaming Association has proposed a set of updated policy guidelines for casino payments. 

The proposition looks to let visitors fund their activities at gambling establishments via digital avenues instead of allowing only physical fiat currency, said a statement Tuesday. 

It remains unclear whether the AGA includes cryptocurrencies under its digital payments reference. Cointelegraph reached out to the AGA for comment but received no response as of press time. 

The masses want options

More than half of customers desire other payment options, the statement said, adding: 

"The principles come at a time when the majority (57%) of past-year casino visitors report the option for digital or contactless payments on the casino floor is important to them because of the COVID-19 pandemic."

After COVID-19 prevention measures gained prevalence in March, much of the world went digital for work and other activities. The future of physical cash usage remains unclear going forward in light of recent events.

"Recent AGA research found that 59% of past-year casino visitors are less likely to use cash in their everyday lives because of the COVID-19 pandemic," the statement said.

WEF Hopes to Stamp Out Corruption With Colombian Blockchain Trial

The World Economic Forum looks at blockchain as a solution against foul play in government processes.

The World Economic Forum (WEF) hopes to make corrupt activity in the public sector more difficult using blockchain technology.  

“Corruption is a ‘high-potential’ space for blockchain because you really benefit from decentralization; records are very difficult to remove or censor, for instance,” WEF blockchain project lead Ashley Lannquist told Cointelegraph. 

Lannquist is one of the authors behind a June report detailing how the WEF, the Office of the Inspector General of Colombia and the Inter-American Development Bank have formed, "a multistakeholder team to investigate, design and trial the use of blockchain technology for corruption-prone government processes." 

Corruption comes from the shadows

The report states that shady dealings plague the public sectors of many countries — but increased transparency, public accountability and proper documentation are solutions. Blockchain is one way to do so. 

Known as the Transparency Project, the WEF’s multi-entity endeavor looks for specific applications in public procurement. The group will harness a permissionless version of the Ethereum blockchain for the job. 

The Transparency Project has a location in mind for experimentation  

The WEF’s blockchain project has selected Colombia as a test site for its blockchain-based framework, the report said, adding: 

“The project developed a blockchain-based software proof- of-concept, or PoC, for public procurement that intends to be tested in a live procurement auction in Colombia in 2020.”

It will be tested on a public education food program in Colombia that has previously hosted foul play.

The write-up cites blockchain’s benefits in terms of auditing, decentralization, smart contracts, transparency, immutability and filing capabilities. “These properties make blockchain a high-potential emerging technology to address corruption,” the report said, adding:

“The project chose to focus on the public procurement process because it constitutes one of the largest sites of corruption globally, stands to benefit from these technology properties and plays a significant role in serving public interest.” 

Blockchain has also seen a number of other real-world applications in recent years, with companies such as Amazon, Microsoft and Intel leading the charge.

Cybercrime Up 75% During COVID-19, Congressional Hearing Details

A recent U.S. government hearing showed a significant uptick in online crime since COVID-19 took over in 2020.

Giving the opening remarks during a U.S. House meeting on illegal digital activities, Representative and subcommittee chair Emanuel Cleaver (D-MO) noted a major jump for online crime in 2020.

"We are seeing a 75% spike in daily cybercrimes, reported by the FBI since the start of the pandemic,” Cleavor said in his opening statements of the June 16 virtual hearing before the Subcommittee on National Security, International Development, and Monetary Policy. 

Speaker dials into specific attacks and sectors

After COVID-19 prevention measures caused business closures and shelter-in-place orders in mid-March, many companies looked to remote work. As droves of people increased their web activity, hackers saw more opportunities. Amid newfound need for online meetings, for example, popular video meeting platform Zoom suffered widespread data leaks

Called on for comment as a witness in the meeting, VMware's head of cybersecurity strategy, Tom Kellermann, singled out the finance industry, noting a 238% uptick in related digital crime between January and May 2020. "This is compounded by the 900% increase in ransomware attacks,” he added. 

Kellermann mentions a crypto connection

After noting a number of ways nefarious parties have preyed on victims, Kellerman mentioned an uptick in crypto exchange hacks and leaks. He also explained that parties use these venues as a means of laundering money, in tandem with the dark web and anonymous digital assets.

“Dark web forums enabled by anonymous virtual currencies have created a bazaar for criminals and organized crime to reach a global market,” Kellerman said, also mentioning “extremist organizations.”

The VMware cybersecurity head added:

“Many of these payment systems and cryptocurrencies offer true or relative anonymity. This raises the necessity of increased regulation of digital money.”

In combination with a number of other points, Kellermann posited increased regulation as a possible solution, mentioning several proposed regulatory actions.

Bitcoin maintains a level of pseudonymity, depending on its purchase origin. In most cases, however, the public can track Bitcoin more easily than cash. Although Kellermann called out digital assets for their anonymity, many assets yield traceability. Anonymous coins, such as Monero and Zcash, tout additional privacy-focused features, but are often misunderstood. Recent research shows criminals' lack of proper anonymous usage.  

Filecoin Mainnet Launch “Is on Track”

Filecoin's mainnet is on pace, with its testnet competition possibly commencing in July.

After releasing details of its testnet competition several days ago, Filecoin business development staff Angie Maguire said the project's mainnet is on pace for this summer.

"The Filecoin mainnet is on track for our launch window July 20 to Aug. 20," Maguire told Cointelegraph via email correspondence on June 10, pointing back to the project's public roadmap

Filecoin will run a testnet competition, starting soon

Filecoin, a blockchain-based data storage project, announced its upcoming testnet competition on June 10, prior to its upcoming mainnet launch.

Meant to work out the kinks in the network prior to mainnet launch, the testnet contest rewards the top 100 global miners, factoring in the storage each puts toward the ecosystem. Top miners on each continent also garner prizes. 

"We’ll confirm the exact start date when we fix a launch date, but the competition may begin as soon as early July," Maguire detailed.

The competition has attracted community interest

The community is interested in the contest concept, Maguire confirmed. "We’ve been getting very positive feedback from our global community of miners and we’ll be hosting a live Q&A later this month to ensure that everyone is well prepared for the contest."

Noting the source of inspiration for the competition, Maguire explained:

"Incentivized testnets have become a best practice for helping users prepare for new chains to launch. We reviewed many testnet incentives programs and combined the best elements with some unique Filecoin characteristics like storing real user data." 

Filecoin's project has been in the works for years, after raising $257 million during its 2017 initial coin offering.  

Cryptocurrency News From Japan: June 7 – June 13 in Review

Japan's minister of finance questioned crypto terminology, a company joined the Japan Security Token Association and more headlined news from Japan this past week.

This week’s headlines from Japan included Japan's minister of finance spurring conversation on crypto terminology, Merkle Science joining the Japan Security Token Association, Fobi Japan listing its own token, and Coincheck unveiling a digital meeting and voting solution. 

Check out some of this week’s crypto and blockchain headlines, originally reported by Cointelegraph Japan.

Japanese politician talks about crypto terminology confusion

Taro Aso, Japan's minster of finance, recently labeled cryptocurrency terminology as confusing, singling out the term "cryptographic assets" specifically. Industry conversation on suitable phrasing followed. 

A social media poll from Cointelegraph Japan showed the public's majority vote for the term "digital coin" in place of "crytpographic asset." 

Japan security token organization add member

Blockchain analytics firm Merkle Science has joined the Japan Security Token Association, or JSTA as a fresh supporting member. 

Japan's self-regulatory agency now counts 15 supporting outfits and eight standard ones. 

Fobi Japan lists Fobi tokens

Crypto exchange Fobi Japan unveiled the listing of Fobi tokens on June 12. The asset should go live on the platform on June 16 for trading and transacting. 

Coincheck launches digital meetings

Crypto exchange Coincheck came up with a way to conduct interactive digital business meetings for shareholders, while currently exploring how blockchain might fit into the mix for added security and legitimacy when voting is involved. 

Exclusive: Wilshire Differentiates its Fund From Grayscale, Says “Investors Deserve More”

Wilshire tells Cointelegraph how its publicly listed Bitcoin fund will differ from other U.S. competition.

The founder of investment firm Wilshire Phoenix, William Herrmann, said his firm’s recently filed U.S. Bitcoin fund notably differs from anything else currently on the U.S. market, based on its Bitcoin price sourcing and involved third parties. In an email exchange with Cointelegraph, Herrmann didn't mention Grayscale's Bitcoin Trust by name, but Grayscale is the most well-known U.S. product in the space.

"The digital asset market has obviously experienced exponential growth, but the products currently in the space have not evolved with such growth," Herrmann told Cointelegraph. "We think investors deserve more."

Grayscale Investments' Bitcoin Trust (GBTC) sits as one of the main players offering a similar product on the traditional U.S. market, although GBTC often hosts sizeable premiums and charges a 2% annual management fee to investors. Wilshire's product eyes a 0.90% fee

A spokesperson for Grayscale declined to comment, saying they had "nothing to add" on Wilshire's new product filing and fee structure.

Wilshire's BCT competes directly with Grayscale's GBTC

Wilshire Phoenix filed an S-1 registration with U.S. Securities and Exchange Commission on June 13 for its Bitcoin Commodity Trust, signalling its intention to offer a new investment vehicle to retail investors. With BCT as its ticker symbol, Wilshire aims to have its product "quoted on OTC Markets Group, Inc.'s OTCQX Best Marketplace (the "OTCQX")," according to the filing.

Essentially, BCT looks to offer mainstream buyers an avenue for Bitcoin purchases, available through traditional brokers and markets. Each share of BCT represents Bitcoin ownership, with actual Bitcoin backing, priced in line with open-market Bitcoin (BTC).  

Grayscale's GBTC offers a similar opportunity, although the product often yields a price premium, meaning users often pay more for GBTC than the underlying Bitcoin bought on crypto exchanges. Additionally, GBTC does not currently offer the ability to redeem shares in the trust for Bitcoin.  The fund's website currently states:

"Grayscale Bitcoin Trust does not currently operate a redemption program and may halt creations from time to time. There can be no assurance that the value of the shares will approximate the value of the Bitcoin held by the Trust and the shares may trade at a substantial premium over or discount to the value of the Trust's Bitcoin."

"Even though this will still not be an official ETF [exchange-traded fund], competition for GBTC is badly needed because their average price premium of 20% + a 2% annual fee are very unfortunate," well-known derivatives trader Tone Vays told Cointelegraph when asked about Wilshire's registration filing. 

"Markets are supposed to be efficient for those that want to hold Bitcoin in their retirement accounts, and currently we do not have efficiency," added Vays, who is organizing an event focused on Bitcoin investment education for later this year called The Financial Summit. Vays also regularly analyzes price action for GBTC  on his YouTube channel. 

Herrmann noted several differences in Wilshire's product

When asked for how specifically Wilshire's BCT will differ from its other U.S. competitors, Herrmann alluded to Wilshire's partnerships with Fidelity Digital Assets and Broadridge Financial Solutions. "Wilshire has retained well-known, unaffiliated third-party service providers – similar to how a more traditional financial product is structured," he said. "We think this provides for important checks-and-balances throughout the product’s lifecycle."

The S-1 registration filed with the SEC listed a number of players involved in the product, including Broadridge Financial Solutions, and custody provider Fidelity Digital Assets. Wilshire could have chosen Coinbase for holding the Bitcoin backing the product, but decided instead on Fidelity. "Both institutions are best in class, we just felt that Fidelity was the best fit for this product," Herrmann said. 

Cointelegraph reached out to Fidelity for comment, but has not yet received a response.

BCT hold's the CME's Bitcoin price basing

Wilshire's Bitcoin fund plans on deriving its Bitcoin pricing based on the Chicago Mercantile Exchange's, or CME's, Bitcoin Reference Rate, or BRR.

The BRR "is a transparent and industry recognized rate and is the same rate that the CME uses to cash settle its Bitcoin futures," Herrmann said. "I think this provides for a more industry recognized and accepted price discovery process for the bitcoin assets."

Recent days have yielded growing Bitcoin ownership interest from the mainstream. As more of the public looks to invest in the asset, products such as Wilshire’s BCT make Bitcoin investment simpler and more accessible. But for now the firm must anxiously await regulatory reproval.

Of that process Hermann said: "We look forward to working with both SEC and FINRA staff in connection with the issuance of the shares and having the shares quoted on the OTCQX."

Disclosure: The author of this article holds a small amount of GBTC.

Changpeng Zhao Spends 20% of His Time Interacting on Twitter

Binance's founder said Twitter is not part of some broader goal, but a way to interact with the crypto community.

Active Twitter user Changpeng Zhao, or CZ, CEO of crypto exchange giant Binance, explained his use of social media, which has played a key role in his exchange's community engagement. 

CZ said his Twitter activity is not part of any overarching goal. "It’s really just a way for me to interact with our community, which I budget roughly 20% of my time to," CZ told Cointelegraph. 

CZ's Twitter game has been strong since Binance's inception

CZ said he has given social media this type of attention since the exchange's early days. Binance kicked off its initial coin offering, or ICO, in 2017, becoming one of the biggest players in crypto in the following years. 

Binance actually first used Chinese messaging platform WeChat, CZ said. When the platform's 500-person group restrictions became a problem, CZ shifted gears over to Slack.

After leaving Slack due to security problems, Binance shifted to Telegram, where the exchange now hosts hundreds of thousands of participants. "Nowadays, if I jump in there, it immediately becomes an AMA session," CZ said, adding:

"With a large amount of users chatting together, whatever I say only stays on the screen for two seconds. It just scrolls too fast. It’s very difficult to view the chat history."

The CEO sees Twitter as an effective avenue

CZ noted Twitter as effective for his community engagement currently, as the platform allows vast viewership. "I personally don’t have a strategic goal when Tweeting," CZ said. "I just be myself when I tweet," he explained. 

Binance holds a large social media presence, which CZ said is a result of his and the company's interaction with participants of the industry. 

He added:

"Part of that is also my unfiltered expressions which can also come with some criticism, and my intention is never to hurt anyone even when the Twitterverse tries to stir up the pot. No one is perfect and we’ve all had our share of blunders. I think it is important for the community to know who we are, how we think, etc."

The CEO said he puts significant effort into hearing out the community, as well as fellowshipping via interviews and other formats, which all leads back to Binance's ultimate improvement. 

Binance has become a behemoth company, not just by industry standard, but in general, as it recently surpassed the 1,000 employee count, tallying a staggering 2,000% increase in less than three years.