EOS Suffers “Major Outage” on Coinbase as Network Performance Issues Arise

This month alone Coinbase suffered issues with EOS thrice, the exchange is still investigating the problem. Meanwhile, No blockchain is cartel resistant, but EOS’s the best, commented Block.One CEO on Binance’s research “Decentralisation, governance and EOS – a lost case?”

EOS continues to experience “degraded performance levels” on Coinbase, reported cryptocurrency exchange on Feb. 22. As a result, the exchange has temporarily suspended sending EOS while receiving EOS on the platform will be delayed.

Buys and sells of EOS on Coinbase, meanwhile are “functioning normally.”

It has been the third time this month that EOS had an issue on the exchange. On Feb. 14, Coinbase first announced delayed EOS withdrawal requests but the incident was soon resolved and the exchange stated, “We are actively monitoring this issue.”

The two days after the incident, there was yet again delays encountered in EOS send/receives which has been resolved the same day again. Coinbase wrote at that time,

“We are currently working through a backlog of outgoing EOS transactions. Customers sending EOS from Coinbase to an external address may experience a delay before the transaction appears on the blockchain. Deposits, buys, and sells are unaffected by this incident.”

The most recent one has been on Feb. 19, when the San Francisco-based degraded performance with send and receives to be delayed. The exchange implemented a fix and is currently investigating the issue.

However, out of all the cryptocurrencies, EOS still got the sign of “Major Outage” beside it on the Coinbase website.

No blockchain is cartel resistant, but EOS’s is Best – Brendan Blumer

Amidst this, Binance released a research report on “Decentralisation, governance and EOS – a lost case?”

In its report, Binance shares how the eight largest cryptocurrency by market cap of $3.88 billion, which was also the largest ICO recorded with USD 4.1 billion raised in a year-long ICO that ended in July 2017, has been labeled as “a victim of its governance,” where largest holders have “all the power.”

Taking a look at its governance, the report assesses that it lacks mechanisms to avoid or structure the process of vote trading. The incentive structure actually promotes selfish acts and individual parties have the influence to drastically change votes, states the report. It also found that two-thirds of the block producers (BPs) have the worst performance among the 21 BPs.

Blender Blumer, the CEO of Block.One, the company behind EOS countered this with, “All blockchains are voting machines where votes can be bought, whether by hardware + electricity or token ownership, therefore none are cartel resistant and all have control groups that can change anything. EOS simply better aligns interests between holders and operators.”

Moreover, its problems are aggravated by a number of other issues like changed block rewards, low voter turnouts, little transparency, 1-token-30 votes system, and little resistance to Sybil attacks.

“No blockchain is cartel resistant, but EOS is aligned,” is what Blumer had to say about this.

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Author: AnTy

Upbit Blames South Korea’s Taxation and KYC Hurdles in Foreigners’ Frozen Funds Saga

Upbit crypto exchange woes are still on after it emerged that foreign clients to this South Korean firm are yet to withdraw their ‘frozen’ funds. The platform suffered a blow when close to $50 million worth of Ether was stolen upon a successful hack towards the end of 2019.

Most of the affected clients are from China with over 6,000 crypto traders’ assets being frozen; they cannot even withdraw using the Korean Won. This group has since concluded that Upbit may be on its way to insolvency and also understated the financial damage caused by November’s 2019 hack. So far, organized efforts to have Upbit act on its obligations have been futile.

Upbit’s Defense

The Korean crypto exchange came out to clear the air on why they are yet to release frozen funds. According to them, structural hurdles under the legalities of financial markets have mainly contributed to this situation.

Top of the list is an internal Korean tax obligation under review; this came up after the authorities took a look of Upbit’s reports in December. The firm however highlighted that,

“Upbit has been working closely with the tax authority to ensure accurate taxation standards, and also with tax experts to review taxation standards by country.”

The other hurdle is a KYC process that has been prolonged despite Upbit submitting updated clients’ records upon request last year. New regulatory pressures from Korea’s regulator may have actually caused this delay given the financial attention and scrutiny triggered by Upbit’s hack.

Users who submitted their ID’s afresh are now wondering whether they are safe or more exposed? This is quite frustrating for them and only time can reveal if indeed Upbit is being truthful in its excuses.

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Author: Edwin Munyui

Australia’s National Stock Exchange Is Building A DLT-Based Real-Time Trading Platform

Both companies listed publicly, NSX Ltd., which is the owner of the National Stock Exchange of Australia, and the financial institution known as iSignthis (ISX) have announced on Thursday that they’re partnering up to offer a platform for trading digital securities.

The platform will be called ClearPay. It is going to be distributed ledger technology (DLT)-based and at the same time offer almost instant transactions instead of delayed settlement. The know your customer’s customer type of security and other solutions offered by iSignthis will be integrated in it.

ClearPay to Compete with ASX

ClearPay aims to compete with ASX, also known as the Australian Securities Exchange, since the ASX is also working to replace its out-of-date CHESS clearing system with DLT. The exchange is collaborating with the blockchain company Digital Asset to provide same-day settlement solutions, as traditional trades take up to 3 days at the moment. The ASX is thinking about starting to test its new platform in July this year.

NSX’s Time to Act

NSX’s CEO Thomas Price mentioned in an interview that cash equity exchanges all over the world are going through a technological revolution and that the market is in agreement when it comes to challenging settlement and clearing legacy methods. Here are his exact words on what NSX should do in such a climate:

“Having patiently monitored the development of the appropriate technology … we consider that this is the right time for the NSX to act.”

ISX Invested $4.2 Million in NSX

ISX invested through a private placement not less than $4.2 million in NSX. This means the investor gets a 12.96% stake in NSX at a share of $0.145. It’s expected for ClearPay to go live at the beginning of next year. After this will happen, the international and domestic broker network should join through the ISO20022 electronic data interchange standard while using a standard blockchain for participation. Share registry operators and participants will gain access to the DTL platform that is going to have the National Stock Exchange of Australia as a central authority.

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Author: Oana Ularu

SEC Settles Enigma’s 2017 $45M ENG Token Sale, Pay $500k Fine and Refund Investors

The ICO project Enigma has settled with the US Securities and Exchange Commission (SEC) over charges of violating the securities law.

Enigma MPC is a blockchain startup that raised $45 million in a token sale from 2017. The SEC announced on Wednesday the settlement requires Enigma to refund all the investors it harmed by using a claims process, registering its tokens with the SEC as securities, filing reports to the agency and paying a $500,000 penalty fee. Back in 2017, Enigma sold ENG tokens that the SEC deemed as securities.

No Securities Registration Requirements Exemption

As the SEC says, Enigma wasn’t qualified to be exempted from the securities registration requirements. A blog post from the Enigma official website says the company is going to set up very soon the claims process, while the firm’s CEO Guy Zyskind explained how the settlement has been reached after many discussions conducted with the SEC. Here are his words on Enigma’s plans for the future:

“[It] clears the way for our development team to return its full attention and energy to our original and continued vision: building groundbreaking privacy solutions that improve the adoption and usability of decentralized technologies, for the benefit of all.”

Enigma Mainnet Was Just Launched

Zyskind also mentioned how the settlement allows the team working at Enigma to focus on the actual protocol, the company’s mainnet that launched last week included. Ever since it opened, the Enigma mainnet gained over 20 validators, says the company. It’s Cosmos SDK-based and secured by the new coin called Secret (SCRT). At the moment, Enigma is trying to legally swap its Ethereum-built ENG token for the new SCRT token. Here’s exactly what the blog post says about this:

“We are continuing discussions with our legal counsel and regulators to identify an effective means of facilitating a swap that complies with all relevant securities regulations, but for the time being, our team is not able to proceed. We appreciate your patience and will update you as things move forward.”

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Author: Oana Ularu

Deribit Exchange Launches Ethereum Daily Options After Success With Bitcoin Contracts

The Deribit Exchange specializing in crypto derivatives has launched daily Ether (ETH) options, an announcement from Monday and made on Twitter says.

The strike price intervals for the new product will be $5. Their expiring date will be every day at 08:00 UTC, so traders will only have a window of 24 hours for trading. As far as their trading lifetime goes, this will be 2 days when introduced. Starting with February 19, Deribit will also scale back the tick size for all options, said Andras Caron, Deribit’s CMO. This means the size will be cut back from 0.001 ETH to 0.0005 ETH.

Deribit Volumes Raised Considerably as a Result of ETH Prices Increasing

Deribit also launched longer duration options settled in cash, in late March of last year Ever since, it has traded a $1.9 million average daily volume. The exchange’s volumes have risen considerably when the ETH prices have increased, so on February 13, Deribit had a record volume of $13 million in 1 day. ETH has recently reached its 7-month $290 high and gained almost 100% until now, for this year. The derivatives space has been very heated in the last few months, seeing huge names such as Intercontinental Exchange’s Bakkt and Chicago Mercantile Exchange (CME) have launched options on Bitcoin (BTC).

Deribit Remains a Leader in Options Volume

Deribit is based in Panama and continues to remain superior as far as options volume. According to Skew, Deribit has handled almost ninety percent of the worldwide volume since January 28.  Deribit’s launch of the daily ETH options arrives just 2 weeks after the daily BTC options went live. This is what Caron had to say about what daily options have to offer users:

“Daily options only have one or two days remaining lifetime and thus lower time value or premium and thus [are] cheaper. These shorter-dated, cheaper options are great instruments to use for short term strategies enabling the trader to hedge events or benefit from expected short term moves.”

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Author: Oana Ularu

Binance Applies for Singapore Crypto License Under The New Payment Services Act

Binance crypto exchange through its parent company has applied for Singapore’s new operating license. This follows an upgrade of laws governing crypto in the FinTech friendly jurisdiction. Singapore sought to advance its payments’ ecosystem legalities as more firms’ leveraging blockchain tech and tokenization set up in the country.

Changpeng Zhao (CZ), has since cleared the air for Binance Holdings noting that its local entity was among the first stakeholders to apply for this new license. According to Mr. Zhao, Binance Singapore is quite open-minded and has been working closely with local authorities since its launch.

Singapore’s Payment Services Act

The payment services act came into being at the beginning of 2020 and is meant to harmonize digital payment operations. This act now regulates crypto market players whose business involves tokens like Ether or clearing and settlements networks that facilitate digital currency transactions.

One of the major reasons for advancing crypto regulation in Singapore was risk minimization. The new payments’ laws are set to empower the country’s Monetary Authority in issues money laundering, terror financing and cybersecurity exposures. Furthermore, it will be much easier to regulate all crypto-oriented firms in Singapore going forward under the same law.

Other firms that have signaled an intention to acquire the new license include Luno and Liquid Group Inc. The two are headquartered in London and Tokyo respectively but have a significant part of their operations in Singapore.

Binance’s swift move in compliance shows that the company’s market prospects in Singapore are promising. The exchange’s operation within this jurisdiction are run under Temasek Holdings’ VC wing, Vertex Venture. Since its inception, Binance has been on an upward growth trajectory despite regulatory uncertainties in booming markets like the U.S. This firm’s journey began with a crypto-to-crypto exchange mindset but is now making game-changing moves in both product innovation and compliance in new territories like Singapore.

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Author: James W

Over $350,000 USD in Ethereum Lost from bZx DeFi Platform in a ‘Complex Transaction’

bZx Exchange, a DeFi based product states it lost over $350,000 USD in ETH following a “malicious attack” or “successful arbitraging” as queries are raised on the overall safety of decentralized finance products. The profiteering party leveraged Compound Finance, wrapped BTC and bZx’s exchange, Fulcrum to successfully carry out the theft.

bZx loses over $350,000 USD in ETH

In a Telegram message on the official bZx channel, co-founder of bZx, Kyle Kistner, informed the community that a “portion of ETH was lost” after an “exploit executed against the smart contract.” Following the announcement, the development team paused all trading on the Fulcrum exchange and have since resumed trading, with the team expected to offer a post-mortem soon.

Well according to the community, the theft can be traced in one transaction on Etherscan.io. The inciting tx is a complex form of transactions that saw the hacker borrow a 10,000 ETH flash loan from dYdX protocol and split the funds into two. One half was sent to Compound Finance as collateral and the other half sent to bZx’s Fulcrum exchange.

Once the amounts were deposited, the hacker borrowed around 112 wrapped BTC (Bitcoin on Ethereum), wBTC, on Compound finance, worth about $1.1 million at the time and shorted wBTC on Fulcrum causing the price to effectively drop. Furthermore the hacker sold the borrowed wBTC on Kyber Uniswap to trigger his short position. Paid back the loan and made off with $350,000 USD in profits.

Total cost of transactions? Only $8.

‘Steps to Maturity for DeFi’

While the lenders and users with funds on the platform remain protected from further hacks, there remains concerns on the overall security on DeFi platforms and the effect of having limited oracles. While bZx denied on a tweet that the hack was caused by relying on Uniswap as an oracle, Chainlink CEO, speaking during the ETHDenver conference discouraged the use of one oracle saying,

“You can’t rely on [only] one oracle connected with an exchange API.”

However, there remains optimistic bZx users who believe this is a learning step for DeFi products to reach maturity. Tim Oligive, CEO of Staked, a company that has ETH stored on bZX, said,

“DeFi is an experiment….I think this is the maturation process for DeFi. You have to get battle-hardened, and if somebody puts out a product that has vulnerabilities, someone else is going to exploit it and that’s part of the system getting stronger.”

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Author: Lujan Odera

OKEx, CoinDCX Exchange Form Partnership to Offer Leveraged Futures in India

The Mumbai-based crypto exchange CoinDCX and the trading platform OKEx have closed a partnership in order to offer Indian customers leveraged futures.

The announcement was made on Friday and says that OKEx is going to help CoinDCX to develop DCXfutures, a new derivative facility in return for introducing the trading platform to the Indian market. By using DCXfutures, investors from India will be given the option to trade the 15x leveraged futures provided by OKEx. The platform will be available for both retail and institutional investors, offering futures contracts in Bitcoin (BTC) and Ether (ETH). Here’s what the head of OKEx India, Zaz Zou had to say about the new partnership:

“India is primed to be the driving force behind the mass adoption of cryptocurrencies, which is why we are keen on adding more equitable currencies to the ecosystem. We believe having a variety of options to transact digital currencies will bolster the growth of economy in India as it positively impacts both crowdfunding and institutional funding.”

Crypto Ban in India Still to Be Ruled On

In the following weeks, the Supreme Court of India is expected to rule over the banking ban issued by the Reserve Bank of India (RBI). Anticipating that the ruling will be in their favor, many crypto companies in the country are starting to set their stalls out. In November 2019, Binance acquired the Indian exchange WazirX and entered the Indian market.

A Growing Demand for Futures

The audit and credit rating firm Crebaco Global has looked at the crypto scene in India, and calculated that if regulated properly, it can reach the $12.9 billion market size, not to mention that it can create somewhere in between 25,000 to 30,000 jobs. This is what Sumit Gupta, the CEO of CoinDCX said about the Indian market and what’s expected of it:

“We have witnessed rapidly growing demand for futures trading among Indian cryptocurrency market participants. […] huge potential of cryptocurrency markets to accelerate economic growth and wealth generation.”

DCXfutures is currently open for testers and expected to become available for the public in Q2 of 2020.

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Author: Oana Ularu

Binance Adds 15 New Instant Fiat-to-Crypto Conversions With Simplex Partnership

Trying to corner local markets, the Malta-based crypto exchange Binance has added support for 15 more fiat currencies through the integration with Simplex.

Gateways for currencies like the Korean won, the Swiss franc, the Polish zloty, the South African rand and the Australian dollar have been created and made available through the exchange’s fiat-to-crypto trading facility. The Russian ruble and the pound sterling are now Simplex supported too. The integration was confirmed by developers to be fully operational until Thursday in the afternoon.

Binance’s Base Cryptocurrencies Will Be Paired with the Supported Fiat Currencies

The supported fiat currencies are going to be paired with the base cryptocurrencies on Binance, which are the assets used by the exchange for default trading pairs. These cryptocurrencies include the Bitcoin (BTC), Ether (ETH) and XRP, while the fiat currencies include the US dollar and even the Nigerian naira.

It seems that fiat volumes are not that significant for the trading activity on Binance, seeing from a daily volume of about $3.5 billion, $3.5 million is fiat. Most of this volume is in US dollars since a gateway for this currency became open. As Binance is folding some of the currencies it supports into US dollars, it’s still not sure if end-users are the ones who generated the exchange’s dollar volume.

Simplex and Binance Working Together Since 2019

Simplex and Binance have become partners in January 2019. They allow users to buy crypto using their debit and credit cards in either euros, Canadian dollars, US dollars and Japanese yens. While the fee charged is 3% plus $10 on purchases under $200, it’s still cheaper than the card or bank providers’ transactions, which levy a 3% FX fee aside from the usual fiat-crypto swap fees. By encouraging users to make trades in their local currency, Binance is becoming more global.

In October 2019, the company’s CEO Changpeng Zhao said Binance integrated the Russian ruble because Russia was representing one of the key markers for the exchange. Thursday, the firm hired a product lead that used to work for Uber in order to expand its services to local markets.

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Author: Oana Ularu

Coinbase Custody Becomes First Custodian With SOC 1 and SOC 2 Security Evaluations

The crypto custody subsidiary of major US-based crypto exchange Coinbase has managed to obtain 2 new security evaluations.

As per a press release from February 12, Coinbase Custody got a SOC 1 Type 2 and a SOC 2 Type 2 report from Grant Thornton, a major US-based accounting firm. This means Coinbase Custody is now able to prove that it complies with many of the security and reporting regulatory standards.

What Information Do SOC Reports Provide?

The Grant Thornton official website says that SOC reports provide information on how strong and present the financial, information and operational controls are in an organization. SOC 1 gives information related to the financial reporting of any organization and are intended for auditor-auditor communications.

On the other hand, SOC 2 gives more information about availability, security, privacy, processing integrity and confidentiality. The Type 1 SOC 2 and SOC 2 reports describe the controls’ design, whereas Type 2 reports cover the effectiveness of controls for a testing time period of 6 months.

Coinbase Custody Will Renew Reports

Coinbase Custody has stated that it’s going to renew its reports. The news about the evaluations arrives soon after in January, Coinbase has a established an Ireland identity in order to make its cryptocurrency services available to European institutions. There are other crypto services providers that went to obtain SOC certificates. For example, at the end of January, US-based crypto custodian and exchange Gemini was granted the SOC 2 Type 2 evaluation by Deloitte.

What Does Cryptocurrency Custody Mean?

The greatest advantage of crypto assets is that they can be under independent custody. Institutional investors and financial markets need a higher level of security standards in order to achieve self-custody. Rohan Barde Hai, a researcher for Blockchain Zoo, explained in September last year how important custody solutions are for institutional investors. The more the crypto market is maturing, the more traditional institutions decide to join it.

For instance, after the new Anti-Money Laundering laws have been instated, 40 banks in Germany asked regulators to approve their digital asset custody services, which means the adoption of crypto is on the rise.

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Author: Oana Ularu