US-based Online Crypto Tax Service Compromised; Hacker Accesses Data From Over 1000 Users

Cryptotrader.Tax was compromised by a hacker who managed to access the data of over 1,000 users of this online tax calculation and filing service. Coindesk reported yesterday that the hacker was able to break into the Cryptotrader.Tax ecosystem through an employee’s account in the marketing and customer service department.

The hacker accessed sensitive information, including personal data such as clients’ names, email addresses, and messages with details on crypto incomes, and payment processor profiles. According to the report, they then preceded to sell affiliated screenshots on the dark web upon which the news was leaked to crypto media.

Following this development, Cryptotrader.Tax Co-founder and CEO, David Kemmerer, confirmed that indeed their system had been compromised on April 7. Kemmerer further reiterated that the hacker had gained access through an employee’s account, noting that they also downloaded a file with around 13,000 rows of information hence the leaked customer data.

He was, however, keen to reassure that filing account passwords were not breached according to a security review done by the Cryptotrader.Tax team. It is also noteworthy that the platform’s website was not compromised as well. Kemmerer highlighted that the Cryptotrader.Tax security team had since taken appropriate measures such as improving monitoring and alerting affected parties.

Despite this recent shake-up of the Cryptotrader.Tax ecosystem, this platform currently proposes significant value in a niche where ambiguity reigns. The project is a Coin Ledger subsidiary and based in Kansas City; its value proposition favors crypto traders in tax reporting. Cryptotrader.Tax enables its clients’ to import trades from over 36 digital asset exchanges. The platform then generates TurboTax compatible reports as per the underlying crypto income gains and losses.

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Author: Edwin Munyui

Bitcoin Back Below $7,000 But Can Go Even Lower While Whales Stockpile BTC on Price Dips

Bitcoin price recovered over 90% in the past few weeks. This week, we even managed to stay above $7,000 only to drop back to below $7k to as low as $6,857.

Source: Coin360

Following Bitcoin, altcoins fell harder, wiping out nearly $12 billion from the overall market cap.

The March’s price decline resulted in BTC price touching the lower historical trendlines. Now, it is at a “significant discount” to the historical trend in the stock-to-flow model.

However, this drop in price didn’t come as a surprise as industry experts and commentators have been already calling for another drop.

“I wouldn’t be surprised if “real” traders are pulling out from Bitcoin to get some gains from the stock market right now and then – take those gains and put them back into Bitcoin,” said Republican Candidate and Forbes Council Member David Gokhshtein.

Actually, it is possible we can go even lower as analyst The Cryptomist said, “Expecting this to go much lower!”

Trader Credible Crypto is also “hunting for longs on this pullback” to $6,600.

A lot of funds have also been moved into exchanges like Binance, Bitstamp, OKEx today that put fear for another sell-off. As per Crypto Fear and Greed Index, the sentiment has slightly uplifted, from 8 on March 28 to 22 on April 9 on a scale of 1 to 100, but they are still in “extreme fear.”

Equity markets had their best week since 1974 amidst the historic jobless claims, going to nearly 17 million, and the Federal Reserve firing yet another bazooka of $2.3 trillion in response to coronavirus hit businesses.

However, experts are saying that this could be nothing but a bear squeeze which means we could revisit new lows. This means the Bitcoin and crypto market could still see another big drop.

According to Credible Crypto, 5,300 is the lowest we would go.

Whales accumulating Bitcoin

As we reported, the futures market for bitcoin has gone back to normal, with premium now positive across all platforms. The retail platforms are actually seeing a strong bounce in premium but CME traders still are more bullish.

On-chain fundamentals also grew this week, especially volume which increased by 23%. The total number of active entities saw an increase of 4.7%, indicating growth in overall on-chain economic activity.

Also, as we reported, the number of bitcoin whales, entities with at least 1000 BTC increased to the levels not seen since the top of the market in late 2017, but it was during the capitulation phase meaning whales were selling. The last time, Bitcoin whales were rising during an accumulation phase was in early 2016.

This ongoing increase in whales led up to last month’s market crash and only accelerated during and after the crash.

“This suggests that larger market players are accumulating BTC, providing an optimistic sign,” states Glassnode.

Now, when compared to halving, the trend implies that “despite an uncertain market environment, whales remain confident that now is a good time to be accumulating BTC, suggesting that they believe there is further room for growth.”

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Author: AnTy

Coinbase Custody Moves Tezos (XTZ) Staking Bakery From US to Ireland For Regulatory Reasons

Coinbase has managed to move the Tezos Staking Bakery, the largest validator since its launch in 2019 which the exchange has been operating since launch, from the United States to Ireland in less than 60 seconds on March 31. The move of staking Bakery was done in the light of regulatory requirements of the Swiss digital asset product provider, Amun.

Coinbase has been offering its custody and baking service to Amun ever since they launched their Tezos-based exchange-traded product on Swiss exchange, SIX. The regulatory changes in the Amun were the sole reason behind the recent move, which required all its staking products and services to be operational within the European Union.

Coinbase Cites Two Prominent Strategies Which They Took Under Consideration Behind the Move to Ireland

Coinbase noted that they pondered over two strategies before deciding to move the Tezos Bakery from the United States to Ireland. The first one was to stop any activity of its US-based validators before deploying the Irish validators. Although the process required nearly an hour in downtime, it ensured that the security risks were minimal.

The second strategy was to initiate the Irish validators before shutting down the US validators and stop the US validators when the Irish validators were completely in control. However, this move would have exposed the validator network to significant security risks. In the end it was decided that the way to go about it was to decouple the validator’s endorser from the node which eventually helped in making the migration process to complete in under 60 seconds.

As a result of decoupling, the exchange found that voting on blocks was being done from Ireland while new blocks were being produced from the United States. Coinbase finally saw a couple hour window suitable for moving the baker to Ireland and eventually completed the migration. Coinbase explained,

“A Tezos validator has two main components: the baker, which produces new blocks that include transactions in the digital ledger, and the endorser, which votes on blocks that other validators produce […] Large Tezos validators typically only produce or bake new blocks every few minutes or hours, but they need to vote or endorse almost every minute.”

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Author: James W

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

Lightning Labs Raises $10M And Launches ‘Loop’ Beta For Faster LN to BTC Payments

Lightning Labs has managed to raise $10 million in a Series A funding that is meant to help the company launch the first merchants’ service for Bitcoin (BTC) payments.

The round was led by Craft Ventures. Managing Director Brian Murray joined the board of directors at Lightning Labs, while other investors were David Heller, the former head of securities at Goldman Sachs, Slow Ventures, Ribbit Capital and Avichal Garg of Electric Capital. This is what Murray said about the service Lightning Network is providing for BTC:

“If Bitcoin is going to reach its potential of being a global currency then it’s going to need to go much faster and cheaper than the base layer. Visa is the payment network that facilitates a lot of the ways currency moves around the world, this is like the service the Lightning Network provides for Bitcoin.”

Lightning Labs LND Raised $2.5 Million in a Seed Round

Back in 2018, Lightning Labs launched the beta version of LND, its scaling solution. It has raised $2.5 million in a seed round. In June 2019, it launched a mobile wallet app.

Starting today, it’s offering the Lightning Loop paid service. Loop is meant to help with the management of merchants’ payment channels, as Lightning channels need to have BTC in them if they are to remain open. Only a balanced in-and-out flow allows them to remain open, so those who are using them have a serious problem. Lightning Labs’ CEO, Elizabeth Stark, had this to say about Loop:

“Loop ‘in’ helps people put funds into their existing channels… kind of like a prepaid debit card for a lightning account. Loop ‘out’ is currently the most popular product because it allows people to continue receiving funds on lightning.”

Loop Hels with Maintaining Liquidity in the Channels

The Loop service will charge only a small percentage from each loop, helping exchanges and merchants keep liquidity in the channels. Stark thinks Lightning Labs is different from other startups offering the same services because it’s turning into an “infrastructure provider”.

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Author: Oana Ularu

New CasperLabs Proof of Stake Blockchain Specification Announced as ‘CasperLabs Highway’

According to a recent announcement published by CasperLabs, the company managed to create a new specification for a much more secure, live, PoS (Proof-of-Stake) protocol. The new specs are named CasperLabs Highway.

As many already may know, PoS protocol came as an alternative to the mechanism used by many cryptocurrencies, including Bitcoin, called Proof-of-Work (PoW). However, while PoW is used for verifying blocks by staking computing power, PoS works differently. It allows users to stake actual currency, which brings several advantages.

One such advantage is that there is no need for a powerful mining network or networks, which ultimately saves not only energy but also money. On top of that, it helps preserve the environment.

The second-largest cryptocurrency by market cap, Ethereum, has been developing its own PoS protocol that is supposed to be implemented shortly. However, there is still a lot of work to be done. According to CasperLabs, PoS faces several various issues regarding the security of the blockchain that uses it.

The company believes that a proper PoS needs to be live, but also much safer than what the developers’ efforts so far were able to produce. These issues were already addressed in the past, with one of the best-known examples being a research paper by Ethereum researcher, Vlad Zamfir. Zamfir released a study called CBC Casper last year, in which he addressed safety, but he left out the live aspect.

Now, with the release of the specs by CasperLabs, both issues were addressed for the first time. The company’s Highway did this by having a ‘summit,’ which will have to reach the consensus, as well as various levels of agreement.

The way that the company explains it is by imagining a mathematical highway, where cars have a constant speed, and vehicles traveling in different lanes tend to send messages over time. When the leading car sends its message, it spreads from one car to another, where each new car sends its own message to the next. Confirming these messages would lead to different agreement levels, which are then reached in ’rounds,’ which represent certain periods of time.

All of this can be possible if the process of moving the ‘lanes’ is dynamic, meaning that the frequency of switching gets doubled when it comes to the left lane, and cut in half for the right one. The concept will be able to speed up the process, while not sacrificing the security of the blockchain. It is still unknown whether the concept could be applied in practice, but CasperLabs is optimistic.

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Author: Ali Raza

iSTOX Security Token Platform Gets Funding From One Of Thailand’s Largest Investment Bank

iSTOX, a security token platform backed by the Singapore Exchange, have managed to raise their Series A funding. iSTOX has declined to give the exact amount, but the funding was provided by the Thai banking firm, the Kiatnakin Phatra Financial Group (KKP).

iSTOX, the company itself owned by ICHX Holdings, is a digital securities brokering platform. As the world goes into a new digital era, iStox will represent the Singapore Exchange and Heliconia Capital’s step into the future.

Last May, it was admitted into the Monetary Authority of Singapore’s (MAS), FinTech Regulatory Sandbox. iSTOX’s start-up plans include trading to begin within the fourth Quarter of this year. It’s goal is to be fully operational come next year.

Aphinant Klewpatinond, KKP’s Chief Executive Officer, released a statement to the public about this matter. He explained that KKP’s new investment in iSTOX would serve as a strategic foundation for the banking firm as they move into the next age of capital markets.

Klewpatinond expanded by stating that the digitalization of securities will be paramount to re-intermediating the world’s value chain. It would allow solutions unavailable to conventional capital markets. He explained that, with this collaboration, they would be able to offer more personalized services to KKP’s clients, both from an investment and fundraising perspective.

Furthermore, Klewpatinond stated that both the KKP and iSTOX would team up in a marketing education campaign and outreach initiative. All this, in a plan that will help improve the everyday man’s understanding of digitized assets and, more importantly, the benefits it can give them.

iSTOX Opening Doors

Darius Liu, KKP’s Chief Strategy Officer, explained that iSTOX has the potential to open doors to a market many investors have primarily left untouched. He cited how a lot of investors aren’t getting the desired returns from public financial markets. Many are slowly becoming interested in the private market: Things like equity for a Series B start-up, hedge funds, and corporate debt.

Liu expanded by stating that these private markets are highly fragmented and lack any form of transparency. This leads to large amounts of money shelled out to intermediaries. Liu claimed that only individuals with a very high net-worth, or alternatively very well connected, could stand to profit from this fragmented system.

iSTOX is being touted as something that gives all users a fair chance by giving them the same access and information as everyone else. While eliminating high operation costs, iSTOX is planning to bring private investments to institutional and accredited investors.

The world is slowly reaching the true digital age, and companies like iSTOX and those that support them, like MAS and KKP, will be at the front of this era. Only time will tell if this project will succeed.

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Author: Ali Raza

The Malta Based Crypto-Focused Founders Bank Raises $10M From Binance And Polychain

A crypto friendly bank has managed to raise $10 million from major crypto players. The bank which will be located in Malta secured the money from lead investors which comprise of Binance and Polychain Capital and will start operations from next year.

The bank which is known as Founders Bank will be co-founded by Paula Pandolfino. According to CoinDesk, the bank also secured the backing of Carduus Asset Management.

Although it is not clear the amount every investor contributed, Pandolfino stated that the bank is looking forward to raise an additional $30 million in the near future.

Pandolfino explained that cryptocurrencies will take over the finance industry and as such it is important to have a bank that will fully support the sector. She added that Founders bank aspires to be a major pillar within the banking sector focusing majorly on crypto based projects and startups. The co-founder also stated that the bank is in the process of changing how the conventional banking conducts its operations.

Currently, the bank is still waiting for the European Union banking certification and initially planned to get funding through equity tokens. However, to speed up the licensing process the idea of equity tokens was abandoned to ensure that there are minimal regulatory aspects.

According to Polychain president, Joe Eagan, the decision to fund the bank was as a result of personal experience after his company had challenges to get a banking partner in 2016. Eagan explained that while the situation has changed after several banks like Metropolitan Bank and Silvergate started to serve the crypto space, there is still room for more players and Founders can help to bridge the gap.

Malta has been working hard to market herself as a blockchain hub and has managed to attract some of the largest companies in the industry. The country is currently dubbed as the Blockchain Island and has so far passed three bills that seek to come up with a regulatory framework and encourage innovation in the blockchain space.

The passing of the three legislative bills made the country the inaugural nation to come up with a legal framework to guide the nascent blockchain industry.

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Author: Joseph Kibe

Coinbase Reveals How It Averted A Complex Hacking Attack Seeking To Extract Private Keys And Passwords

Coinbase’s security team has revealed that it managed to stop a complex phishing attack that sought to extract user private keys and passwords.

In an official blog post the crypto exchange giant revealed that the incident involved the exploitation of two 0-day vulnerabilities on the Mozilla Firefox browser.

According to the blog post, the first steps of this phishing attack started in late-May this year. In the beginning, more than 12 employees of the exchange received an email claiming to be from Gregory Isaacs, a Research Grants Administrator of the University of Cambridge.

The email came from a real Cambridge University UK domain and passed the security filters undetected. Within a couple of weeks, the employees received more emails, which easily passed security checks as they did not have any malicious content.

However, the attackers soon changed their tactics. On June 17, the employees received another email. Unlike the emails that came before it, this email contained a URL. Upon opening the URL with the Firefox browser, it installed a malware on the recipient’s computer.

The San Francisco based exchange details that the hackers used compromised academic accounts to send emails.

The initial emails referenced legitimate academic events. Also, the hackers customized them to fit specific profiles of phishing targets. The June 17 move attempted to infect only 2.5 percent of the targets with the URL that hosted the 0-day.

Coinbase claims that its system and one of its employees flagged the email as suspicious. The exchange’s security team then worked quickly to stop the threat.

With one employee ending up clicking the sent URL. At that point the exchange says:

“we revoked all credentials that were on the machine, and locked all the accounts belonging to the affected employee.”

Although the firm does not divulge lots of details on how they stopped the phishing attack, afterward, Mozilla fixed one of the vulnerabilities in the following day and dealt with the other one in the same week.

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Author: Joseph Kibe