Chilean Central Bank Governor: Central Banks Digital Currencies Can Be Issued Without Blockchain

According to Chile’s Central Bank Governor, Mario Marcel, digital currencies issued by the central banks are beneficial and can run outside of the blockchain technology, the Block reports.

The governor was speaking during the OECD’s Global Blockchain Policy Forum that was held last week. Marcel stated that CBDCs are not new in the finance industry as they have existed ever since the real-time gross settlement (RTGS) were founded.

Marcel intimated that blockchain technology is highly useful in a situation where there are many participants of a given platform and they require to access the ledger information or in situations where the participants distrust each other. In this case, Marcel explained, proof of work is imperative as it makes the register immutable.

According to Marcel, in the case of a central bank issuing a currency whether in the form of fiat or virtual, trust should always be a guarantee. The governor also added that ‘it’s far from obvious’ that an entire lot of participants are entitled to crucial and sensitive information and data like CBDC transactions and movements.

Marcel gave an example of Uruguay whose digital currency, ePeso, that has already been issued in the pilot phase, is not developed on the blockchain technology. The Chile Central Bank Governor does not seem too optimistic about his country having a CBDC, arguing that developing and emerging economies need to pursue other alternatives first like offering fast and efficient payment solutions before issuing CBDC’s.

Marcel’s comments do not mean that Chile’s Central Bank is not keen on blockchain technology. The bank is currently exploring how it can use blockchain technology for other solutions other than virtual currencies such as bonds. According to the governor, the Central bank is partnering with domestic central securities depository (CSD) in efforts to find ways of issuing blockchain-based bonds. At the moment, proof-of-concept is going on and the governor stated that once the report is released more details about the project will be released.

Marcel’s comments come at a time when various central banks are exploring the idea of issuing their own digital currencies especially after Facebook announced the Libra project.

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Author: Joseph Kibe

Litecoin Foundation Set To Allocate Unknown Amount Of Treasury To Celsius Network

Litecoin Foundation is set to invest its capital in another crypto lender to earn interest. According to CoinDesk, Litecoin Foundation is partnering with Celsius Network, a crypto lending firm, to become its ideal crypto wallet.

According to the partnership agreement, the Foundation is set to set aside an unknown amount of its treasury to Celsius Network whereby LTC holders are poised to earn about 10.53% per year back to their crypto holdings as well as dollar loans at about 4.95 percent annually.

According to Celsius Network CEO, Alex Mashinsky, the partnership will go a long way to validate the platform that says that it gives back almost 80 percent of the revenue generated to depositors.

The CEO hailed the deal as a great milestone for Celsius saying that this was the first time that the crypto community is identifying Celsius as major utility provider in the crypto sphere. Mashinsky said that this was a ‘huge event’.

Celsius generated $50 million during its initial coin offering that took place last year and so far the company has already completed about $2 billion in terms of loans. Additionally, the company has held about $350 million per year in terms of customer deposits and provided more than $3.5 million worth of interest.

Speaking to CoinDesk, crypto custodian company, BitGo, said that they held about $1 billion with Celsius crypto deposits in the last one year which represents more than double the amount that has been locked away in decentralized finance platforms.

Litecoin Foundation has been seeking partners in the last one year and has managed to add Miami Dolphins as a major partner and now has bagged Celsius into the partners mix.

In the last one year, Litecoin Foundation has been under intense scrutiny following the news that it was struggling to pay its employees. However, the foundation managing director and Litecoin founder, Charlie Lee has reteriated that he will continue funding the Foundation until its fully financially stable.

Lee has clarified that the partnership with Celsius was for the benefit of the investors as they will earn interest per year. The director also revealed that the Foundation has no intention of seeking out collateral based loans offered by Celsius.

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Author: Joseph Kibe

France Will Not Tax Crypto to Crypto Trades, But Will Tax Gains If Converted To Cash/Fiat

The French government has finally decided how to tax crypto trading. According to the French economy minister Bruno Le Maire, all trades between cryptos are exempt from taxes but the gains will be taxed when they are converted back into fiat currency.

Le Maire affirmed that the government believes that the moment in which the conversion happens is the best time to tax the investors. Also, the Value-Added Tax (VAT) will only be charged when a crypto is used to buy something.

This approach, the minister believes, will help to properly track the transactions. It is hard to do it in crypto to crypto trading, especially when people exchange their assets in different exchanges.

Another important development in the country is that the local regulators have decided to ban Facebook’s Libra because the controversial crypto project is not completely regulated by the local laws.

According to the minister, the main problem with Libra is that it risks putting the national sovereignty of the country at risk, so the asset should not be allowed to be used on “European soil” with the current state of how it works. In case the project is improved, however, it seems that Facebook has a slight shot of having the French people using its token.

In related news, Portugal has also started to move forward on this same topic. The local tax authority has recently affirmed that cryptos will not be taxed in the country, which made the local investors quite satisfied that Portugal will follow the same path as France.

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Author: Hank Klinger

BTC Users Running Lightning Network Nodes Urged To Update After Confirmed CVE Vulnerabilities Exploited

An unfortunate event happened in the Bitcoin Lightning Network recently. According to the recent announcement made on Twitter by Lightning Labs, the network is currently being exploited due to a vulnerability.

According to the tweet, all Ind 0.7, c-lightning 0.7, eclair 0.3 and their editions below that are possible to be affected by the exploit, so people should upgrade to the latest version of the system in order to protect themselves from the attack. The latest versions, 0.7.1 and 0.3.1, are not subject to the attacks.

Olaoluwa Osuntokun, the Chief Technology Officer (CTO) at Lightning Labs, affirmed that there are several cases of people exploiting the network. The exploit was originally discovered a few days ago by Rusty Russel, another LN coder.

According to Russel, security vulnerabilities could make several projects to lose funds. He did not disclaim exactly what was the bug, obviously, in order to protect the users, but someone or a group of people may have discovered the exploit and is using it to steal money from the LN.

The Twitter profile also warned people that LN technology is prone to have bugs as it is still during its experimental phases. Because of this, nobody should put more money on the network than they were willing to lose if a bug happens.

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Author: Hank Klinger

BitMEX COO Kwan Steps Down; Crypto Exchange Says She Is On “Gardening Leave”

According to the Block, Angelina Kwan, the chief operating officer at crypto exchange platform BitMEX, has left the company after relinquishing her seat.

According to the exchange’s spokesperson, Kwan is set to leave the company and at the moment is currently on leave. The spokesperson explained:

“We can confirm that Angelina Kwan is leaving the company and is on gardening leave now. That’s all we can say on the matter at the moment, but we wish Angelina all the best.”

Kwan joined BitMEX management late last year in October and has previously worked as director in Hong Kong’s Securities and Futures Commission in charge of enforcement as well as market supervision.

Prior to her position as BitMEX’s COO, she was working as the managing director as well as regulatory compliance chief in Hong Kong Exchanges and Clearing. During her tenure there, Kwan had stated that lack of clear and concise regulations in the crypto industry was a major setback among investors who wanted to venture into crypto exchanges.

By press time, BitMEX was ranked as the biggest crypto exchange as per the reported 24-hour trading volume, which at the moment stands at around $3.4 billion as per the CoinMarketCap.

Speculations are rife on the reason why Kwan left the exchange with Cointelegraph suggesting that the decision by the United Kingdom’s Advertising Standards Authority to uphold its verdict that BitMEX was advertising Bitcoin in its site could have fueled her departure. The advert in question presented a graph comparing Bitcoin’s value with the US dollar in the last ten years.

According to the Block, BitMEX has recently been embroiled in troubles with the US regulators. Reportedly, CFTC is investigating the platform on whether it went against the set rules and guidelines by permitting US citizens to use its platform for trading.

The industry has witnessed various high profile departures including crypto advocate and Overstock CEO Patrick Byrne who resigned last month. However, tZERO, a subsidiary of Overstock assured investors that Byrne’s departure will not affect its operations.

For now it is not yet known who will replace Kwan as the next BitMEX COO.

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Author: Joseph Kibe

Coin Metrics: Bitcoin Miners All-Time Revenue Tops $14 Billion

According to fresh data released by Coin Metrics, the all-time revenue generated by Bitcoin Miners has topped $14 billion.

Yahoo Finance had reported on 30th August that despite the network increasing its hash rate by a large percentage, miners are still in a position to make tons of money. For those not in the know, increasing the hash rate in a network reduces the profit made by miners.

BTC Miner Revenue Continue To Grow At An Exponential Rate

The report from Yahoo notes that after the inception of the BTC network, it took the miners a total of 8 years to surpass the $5 billion mark. It, however, notes that the next $5 billion was mined at a faster rate as it only took 8 months for the miners to break their all-time revenue and top $10 billion.

What these mining statistics mean is that if the current mining profitability is to remain on track, then chances are that miners will top the $20 billion revenue mark by the start of next year (2020). The current mark of $14 billion is the most impressive taken into account that the hash rate has recently been on a massive tear. It is a tear that has seen it break some past records in the last few months.

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Author: Daniel W

United Nations (UN) Chief: Cybercrime Is Harder to Fight Because of Crypto

A high executive of an international organization has recently attacked cryptos. According to Neil Walsh, an official of the United Nations (UN), cryptos can make it harder to fight cybercrime. He affirms that their anonymous nature can often get in the way of tracking criminals and that this can become an issue.

Walsh, who is the chief of the UN Office on Drugs and Crime’s cyber unit, has been recently interviewed by an Australian media outlet. He believes that the extra layer of anonymity that can be provided by privacy coins or even Bitcoin (which can be used together with coin mixers) definitely makes the work harder and slower to complete.

He affirmed that there are more child pornography networks around the world than people believe and that most of them use cryptocurrencies due to the illegal nature of the content that is sold in them. Nobody wants to be tracked and cryptos are often the tool to make it happen in dark web transactions.

In related news, the UN has recently affirmed that hackers from North Korea hacked at least $2 billion USD from exchanges. There are suspicions that the money was used to fund the country’s nuclear program.

Most of the attacks were targeted at South Korea, which is the closest country. At the moment, the UN is said to be investigating 35 cyberattacks in South Korea made from their northern neighbors.

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Author: Bitcoin Exchange Guide News Team

Users Affected By Binance KYC Leak Hack Will Get Free VIP Accounts

Binance has decided to give something to the users who were allegedly hacked. According to a recent blog post, the company will give free VIP accounts to any user related to the Know Your Customer (KYC) leak incident.

While the company disputes that it was hacked and affirms that some of the information was actually stolen from a third-party company, it has chosen to offer some kind of compensation for the incidents, as some of the leaks match actual clients. Most “leaks” are said to missing vital information, though, which is great.

According to the crypto exchange, some of the images stolen from the third-party company overlap with the ones that Binance has in its own KYC. Multiple pictures were photoshopped, though, or do not match the records that the company has. The main reason for the company not to believe that the hack happened was because the images lack the company’s watermark.

The exchange affirmed that it has “robust security” measures which are being used to safeguard the assets of its clients. These measures include AI-verification and all the data is stored with several protections, so the hacker would really need to do a notable job to be able to crack them.

Now, all the potential victims can become VIP customers for their lifetimes. They will get all the advantages without ever having to pay for them.

Binance has also requested that, just in case, everyone affected by the hack should issue new documents in their countries, as there is the risk that some sensitive information might be leaked by the actual hack, the one made on the third-party company hired to handle KYC some time ago.

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Author: Hank Klinger

CryptoCompare Says Best Rated Bitcoin Exchanges Make Up Only 5% Of All Trading Volume

A new report has shown that untrusted crypto exchanges are still commanding the market. According to it, the top-rated exchanges (rated AA and A) hold only 5% of the volume. Most of it is held by exchanges with the second and third-worst ratings, E and D.

The study, which was made by Cryptocompare, shows that bad exchanges are still leading, however, they are not growing so much. When AA, A and B platforms are compared against the ones graded with C to F, they have grown 4.4% compared to 0.7% of the bad ones. It is still not enough.

Most untrusted exchanges, such as LBank, CoinBene and Coinsbit have reported very large trading volumes when compared to trusted ones. For instance, LBank has trades which are 15 times larger than Coinbase. Binance, however, which is rated very well, is leading among the good exchanges.

Market Manipulation

It is important to notice that the data is subject to manipulation because exchanges such as CoinBene are accused of wash trading. Since Bitwise Asset Management affirmed that 95% of all BTC trading volumes were fake, there has been a lot of discussion about this.

Unreliable platforms are common and make up for a large volume, which is why companies such as CoinMarketCap are pressuring these companies to disclose more accurate data about their sales. The site has recently affirmed that it would delist all non-compliant companies. Unfortunately, it seems that this is the way to go when there is so much manipulation in the market.

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Author: Gabriel Machado

US Secretary of State Wants Bitcoin To Be Regulated Similar to Other Electronic Transactions

Mike Pompeo, the U. S. Secretary of State, wants to regulate Bitcoin (BTC). According to him, the asset should be regulated in the same way that all other financial transactions which made online currently are.

During a recent interview with CNBC’s Squawk Box, he affirmed that anonymous transactions are very risky and that terrorists might start to use it if they remain unregulated. According to him, the country has moved forward a lot when it comes to tracking money, so not doing it would open a breach for illegal activities.

To him, if anonymous transactions become the norm, this would greatly decrease the security of the whole world, which can become an issue as time passes.

The host of the show, Koe Kernan, brought up that the Treasury Secretary Steve Mnuchin affirmed that more Bitcoin is used for illegal activities than cash. Pompeo supported the other secretary in his allegations against crypto.

According to Mike Pompeo, however, the main difference between him and his colleague is that Mnuchin wants a very tight and specific regulation on Bitcoin, while he believes that the asset should just be regulated as any other asset currently is.

Unfortunately, neither of the secretaries seem to understand Bitcoin very well. It has been proved several times that fiat currency is used way more than Bitcoin in money laundering and terrorism financing, so there is no excuse to keep being ignorant on the subject.

Bitcoin is also very hard to regulate, so they would probably have a very difficult time to do the same that can be done to similar digital transactions.

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Author: Lillian Peter