Turkish Crypto Exchange Under Investigation After Abrupt Shut Down, User Funds ‘Irretrievable’

Turkish Crypto Exchange Under Investigation After Abrupt Shut Down, User Funds ‘Irretrievable’

With about 390,000 active users affected, the senior economic adviser to the President calls for the Turkish government to take action and “carry out a regulation.”

An investigation has been launched into a Turkish cryptocurrency exchange Thodex after the platform became inaccessible on Wednesday. The exchange abruptly halted trading, citing unspecified partnership transactions.

The Public Prosecutor’s Office in Istanbul appealed to the personnel for their testimonies on the platform, after users who can’t access their digital assets complained to the authorities, reported the state-run Anadolu Agency.

The website of the exchange is inaccessible, displaying a “404 Not Found” message.

Operating since 2017, Thodex advertises itself as Turkey’s first licensed crypto exchange and has 14.8k followers on Twitter.

In an undated statement on the website, the exchange said it decided to allow outside investment to serve its customers better adding, services will remain shut for five working days while the transfer is completed, but users need not be worried about their investments.

Unable to withdraw their funds, users of the exchange have now filed a complaint alleging fraud.

“We’ve filed a legal complaint on Wednesday,” Oguz Evren Kilic, who represents an unspecified number of Thodex users, told Bloomberg. According to him, hundreds of millions of dollars worth of assets of about 390,000 active users is “irretrievable.”

The founder and CEO of the exchange Faruk Fatih Ozer allegedly fled the country on Wednesday. Demiroren News Agency said Ozer’s gone to Albania, based on a photo which it said is of Ozer at the airport.

The Turkish government should take action “as soon as possible,” Cemil Ertem, senior economic adviser to President Recep Tayyip Erdogan, told Bloomberg on Thursday.

“Pyramid schemes are being established in this area. Turkey will undoubtedly carry out a regulation that’s in line with its economy but also by following global developments.”

About a week back, Turkey’s central bank banned the use of cryptos as a form of payment from April 30, citing possible “irreparable” damage and transaction risks.

Amidst this, the search for bitcoin, crypto, altcoins, DeFi, and NFT on Google in the country have surged to all-time highs as Turks seek investments to hedge against the depreciating fiat currency and high inflation.

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Author: AnTy

European Central Bank (ECB) Demands Power to Shut Down Private Stablecoins, Like Diem, in the EU

European Central Bank (ECB) Demands Power to Shut Down Private Stablecoins, Like Diem, in the EU

The European Central Bank finally tables its official opinion regarding crypto regulations to the top decision-making again, European Commission.

In their official opinion, the ECB now wants the EU members of parliament to grant its veto powers regarding the legal status of stablecoins such as Facebook-supported-Diem.

The ECB raised its concerns regarding the use of stablecoins that get their value from being pegged on one or many global currencies. The central bank is worried that stablecoins could jeopardize its control on payments, banking, and cash supply. Part of the ECB’s statement reads,

“Where an asset-reference arrangement is tantamount to a payment system or scheme, the assessment of the potential threat to the conduct of monetary policy, and to the smooth operation of payment systems, should fall within the exclusive competence of the ECB.”

The ECB also urges the lawmakers to ensure its absolute powers on stablecoins are binding and applicable to the entire national authorities within the Euro Zone.

The ECB argues that various ‘rigorous liquidity requirements’ are crucial in ensuring redemption rights are protected and clients’ direct claims towards the reserved assets that the issuers of stablecoins hold.

Firms offering tokens which are pegged on different currencies should at a minimum grant end-users a direct claim on the issuer or the reserve assets and redemption rights”, the central bank added.

Facebook had in the past laid a plan to roll out its stablecoin dubbed Libra that was pegged on different global currencies. However, the tech giant slowed down on the Libra project following many regulatory hurdles in the world. At the moment, the firm is aiming at launching the dollar-pegged stablecoin dubbed Diem.

If the EU legislators grant ECB the veto powers, Facebook and other privately issued stablecoins will likely encounter another round of regulatory backlash irrespective of the project being licensed by Swiss authorities.

It is also important to note that Christine Lagarde, the current ECB president, has criticized cryptos and stablecoins. Lagarde has in the past said central banks should never be allowed to hold Bitcoin.

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Author: Joseph Kibe

German Police Shut Down Dark Market that Facilitated $170M in Crypto Transactions

German Police Shut Down Dark Market that Facilitated $170 Million in Cryptocurrency Transactions

In the latest crackdown on the Darknet marketplace, German police arrested a 34-year-old Australian national near the Danish border who allegedly operated DarkMarket, a site used by half a million people.

According to the prosecutors in the western German city of Koblenz, DarkMarket facilitated at least 320,000 transactions that include 4,650 for Bitcoin (BTC), 12,800 for Monero (XMR), and another cryptocurrency, totaling more than 140 million euros ($170 million).

More than 20 servers were also confiscated in Moldova and Ukraine by the authorities.

The platform was used to sell drugs along with counterfeit money, stolen and fraudulent credit card information, anonymous SIM cards, and malware offerings.

Authorities from around the world contributed to this investigation — from the Federal Bureau of Investigation, the U.S. Drug Enforcement Administration to the EU’s Europol and police from the U.K., Denmark, and Ukraine.

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Author: AnTy

Binance Uganda Will Shut Down Its Operations Next Week; CZ Cited Lack of Users

  • Binance Uganda set to shut its doors next week.
  • Binance CEO, CZ, says closure of BinanceUG is part of a “business decision.”

After a two-long year stay in operations, Binance Uganda, one of the African outposts for the world’s largest crypto exchange, will be shutting its doors on November 11. The closure follows a mission by Binance to cut down on losses, which also sees British Isle-based exchange, Binance Jersey, shut down its businesses on November 30th.

The East African country has enjoyed the exchange’s services from the fall of 2018, offering a direct platform for Ugandans to use the Shilling to purchase cryptocurrencies. The launch of Binance UG targeted efforts to promote crypto adoption across the continent, using the country as a starting point to taking over the African market.

Why Binance UG is shutting down

In an interview explaining the recent closure of the Ugandan branch, Binance CEO, Changpeng “CZ,” Zhao explained it as a “business decision.” He further claims the platform is a loss-making center for the larger Binance.com firm as it does not “generate enough revenue to be profitable.”

However, the closure of the Ugandan and Jersey exchanges raised qualms on Binance relationship with regulators – as explained in a Forbes article. The article accuses the exchange of “conceiving of an elaborate corporate structure designed to intentionally deceive regulators and surreptitiously profit from crypto investors in the United States.”

However, CZ dismissed the FUD claiming that Binance only operates where regulators have offered a license. As the issue with regulators is set to rise once more following Binance UG closing down, CZ explained,

“Some people misinterpreted that as maybe we got into trouble with the regulator locally or something. And that’s not the case.

We do have good relationships with regulators in both areas that we have an exchange winding down. It’s just a business decision.”

Moreover, Binance.com launched support for deposits and withdrawals of the Ugandan shilling, which duplicates the functions of Binance UG. With most users switching to the main Binance platform and more services offered on it, the need for a local crypto platform does not make sense.

“All the features that Binance Uganda provides [are] now covered by Binance.com together with our fiat channel partners,” CZ said. “There’s a very minimal number of users on there, so it doesn’t make sense for us to maintain two platforms.”

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Author: Lujan Odera

After Shutting Down Ahead of EU’s 5AMLD, BottlePay’s Set to Relaunch New Lightning Payment App

BottlePay, a social payment app that choose to shut down its operation in December of 2019 amid regulatory concerns, is ready for a relaunch with a new Lightning Payment App. The firm has restructured its products and services to comply with Europe’s 5th anti-money laundering directive (AMLD5). The new payment app also offers an exchange wallet with social features on Reddit, Twitter, and Discord and set for a beta launch in August.

Some of the features of the new payment app include scheduled payments to buy more bitcoin, which is quite similar to Square’s Cash App. However, this feature would be first rolled out in Europe. Users would also have the option to opt for a custodial or non-custodial wallet.

Pete Cheyne, a co-founder of BottlePay, said, “Lightning works in the background, without users having to manage channels.” Adding,

“There will be a small fee for exchanging between fiat and bitcoin, and vice versa. … There will also be tiers because people are interested in our app for different use cases.”

Mark Webster, CEO of BottlePay, revealed that his team of 11 employees was funded continuously by their angel investors, who were responsible for trading equity worth $2 million in 2019. He explained that the firm has no immediate plans to support any token. Webster also revealed his plans for expanding his workforce up to 35 people by 2021.

Webster went on to reveal that most of the recent hiring has been in the legal and marketing department, which helped them in restructuring their product. He said,

“I think Lightning is at the core of the strategy. As consumer demand increases, we can open more channels. You can store a fiat balance, Scan a Lightning code, and pay that from your pound or euro balance.”

The scheduled beta launch in August will be limited to the European citizens. Still, Webster said that he hopes to expand the reach of his application in the United States and hopes to launch a Telegram integration by 2021.

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Author: Hank Klinger

COVID-19’s Impact On The Economy Claims Another Business as Cambrial Capital to Shut Down

Cambrial Capital which focuses on a Crypto fund of funds is set to shut down its operations in the near future according to insiders familiar with the issue.

Cambrial Capital is set to become the latest victim of the Coronavirus epidemic and its vast impact on the global economy. The fund, which manages about $6 to $10 million is set to wind down amid the crisis. The firm suffered its largest loss on March 12, which the crypto community has dubbed ‘Black Thursday’ where Bitcoin shed over 40 percent of its value.

Commenting on this issue; “We don’t talk about our products publicly given we’re regulated,” David Fauchier, Cambrial’s co-founder and chief investment officer, told CoinDesk. “We’d have to run any response through our [regulatory] umbrella and we’re a little busy right now.”

Cambrial Capital was started in 2018 in the United Kingdom and received an operating license from the U.K.’s Financial Conduct Authority (FCA). The firm has an experienced team that consists of Alex Obadia, Ha Duong and Edward Nelson. Close sources told CoinDesk that Cambrial Capital has one of the most respected teams in the industry.

Fund managers that are experts in different strategies and take pooled investments and diversify them into other categories, or a “fund of funds.”  Startups such as Cambrial Capital operate with various tactics like arbitrage, mean reversion, OTC trading, market-making, and others.

Due to their diversification, companies like Cambrial are also known as market neutral. Investment in the crypto market is considered a high-risk aspect and other firms are also suffering like Cambrial as others are facing tough times due to market rout in the last one month.

Adaptive Capital, a crypto hedge fund, stated that it was shutting down and will return the remaining capital to its investors due to market turmoil in March.

Despite the turbulent market, some players are positive that the market will stabilize soon after the Coronavirus crisis is over.

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Author: Joseph Kibe

CME Suspends Trading Floor As Bitcoin (BTC) Price Plummets To 11-Month Low

  • Chicago Mercantile Exchange (CME), a Bitcoin futures platform, will shut down its trading floor in response to the growing Corona Virus (COVID-19) epidemic.
  • Bitcoin (BTC) dropped over 30% on Thursday as the market embraces the global asset bloodbath from the virus.

Corona Virus has taken the headlines across the globe as firms and economies suffer from the pandemic. While the cryptocurrency market has remained comparatively immune for the past few weeks as other global assets tanked, the market is finally catching a cold as CME announced the closure of its BTC Futures at the end of day on March 13.

Notwithstanding, the price of BTC has tanked to April 2019 levels after a $1,800 USD drop in price at 10.00 AM GMT on Thursday. Will the cryptocurrency market survive the global epidemic and reverse the ultra-bearish trend?

CME set to close trading floor in Chicago

In an announcement from CME, the second company to offer regulated BTC futures in the U.S, trading on the platform will be suspended starting Friday, 13th March at the close of business. The derivative exchange said the move to shut down its trading offices in Chicago is a precautionary move to the increasing cases of COVID-19 virus across the U.S and the world.

Trading will continue normally on CME Globex, with the company only aiming to reduce the large gatherings of people in accordance with medics recommendations. The statement further reads,

“No coronavirus cases have been reported on the trading floor or in the Chicago Board of Trade building. The reopening of the trading floor will be evaluated as more medical guidance on the coronavirus becomes available.”

The Corona Virus effect on Bitcoin?

After CME’s announcement of the closure of its offices come Friday the 13th, BTC’s price has dipped to 11-month lows at $5,600 USD. After a period of immunity against the global pressures that saw the price of stocks plummet and oil price wars by Russia and Saudi Arabia, crypto is finally catching on following the bearish trend.

Currently, a number of crypto firms have tried to mitigate the Coronavirus problem offering work of home assignments, such as Coinbase, Gemini and Blockstack. However, the market looks headed to a crash below the $5,000 mark as fears rise across the investor pool.

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Author: Lujan Odera

Waves Decentralized Exchange (DEX) Shuts Down, Morphs Into Hybrid Digital Trading Platform

The Waves Decentralized Exchange (DEX) has decided to shut down its platform and start offering services to clients as a hybrid crypto platform. The information was released by the company in a press release on December 2.

Waves Launches New Crypto Trading Platform

According to the official statement released by the company, they are migrating their services from the DEX website to the new Waves.Exchange.

The official site of the Waves DEX explains that they are no longer operating the service because they want to offer users a better experience and a wide range of tools.

This is why the DEX will not be available anymore to users, that will have a new platform specifically designed to meet their needs.

It is worth mentioning that users’ funds will be safe during this time. This is very important considering many exchanges were affected by hacks and attacks during the last few years.

The new hybrid exchange is expected to become fully operational in a short period of time. Some of the new features include irreversible transactions and improved control of funds for users.

Decentralized exchanges became popular due to the fact that they allow users to remain in custody of their cryptocurrencies rather than giving the funds to a crypto exchange that handles them.

The report explains that the company will be working in order to continue with the development of its protocol. This includes the implementation of sharding and other innovative infrastructure.

The crypto exchange will be fully managed by a separate and dedicated team to make it more efficient.

The CEO of the platform, Sash Ivanov, said that the DEX was just a prototype and that they are now able to become a separate project. The main goal is to synchronize the development of the ecosystem and help the products and services offered have higher standards. He said,

“Waves DEX was a kind of prototype. Now, after 2 years of operation, it has grown and become a separate project. […] Now it’s time for us to focus on protocol development and hand over the exchange to an external team and community separate from Waves, so we can merge all the infrastructure teams into one, synchronizing development work and taking the combined product to a new level.”

In the future, they want to add support for Tether (USDT) stablecoin, which would make it easier for traders to hedge against volatility in the cryptocurrency market.

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Author: Carl T

Unregistered Crypto Exchanges Must Register With South Korea’s FSC Or Face Jail Time

The government of South Korea wants all unregistered crypto exchanges in the country to shut down. If they don’t, their owners may go to jail.

Recently, lawmakers of the country decided that all exchanges should register with the Financial Services Commission (FSC). Now it has created a bill that determined that any administrator who has not done so and continues to do business, it can serve up to five years in jail and will have to pay a fine of around $42,000 USD.

The new amendment was created in order to help the country to comply with the guidelines that were submitted by the Financial Action Task Force (FATF) recently. All countries within the European Union are expected to follow the guidelines.

Lawmakers from the opposition, however, were not so happy with the new bill. Some of them affirmed that this could end up contracting, even more, the domestic crypto industry in South Korea.

If the amendment is really passed, companies that use virtual accounts with names could be hurt, too. Only Bithumb, Coinone, Upbit and Corbit have bank accounts with names, so other companies may be harmed by the new law and the market would become even more centered on these big exchanges.

The CEO of Gopax, Lee Jun-haeng, a cryptocurrency exchange without any real-name virtual accounts, affirmed that the idea of having named accounts is nice, but only if the market is fair, which was insinuated that it was not.

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Author: Rebecca Asseh

Canada’s Einstein Exchange Allegedly Lost $12.1 Million in User Funds, Has Under $50K to Repay Users

According to Global News, a Canadian crypto exchange that got shut down this month for supposedly stealing CAD$16 million, which is $12.1 million, in user funds seems to only have $45,000 worth of hard assets. Einstein Exchange was shut down by the B.C. Securities Commission (BCSC) after customers filed complaints that they can’t access their crypto assets and cash.

Grant Thornton Limited has been appointed to seize the cryptocurrency exchange’s assets and to return users the funds they were missing. These funds were Bitcoin (BTC) cryptocurrency, as the BCSC documents say.

Einstein Exchange Doesn’t Can’t Pay Back Users

A filing from the British Columbia Supreme Court was published yesterday. It says Grant Thornton found out that Einstein Exchange has only about $30,000 in cash and $15,000 in cryptocurrency. Director Michael Ongun Gokturk has incorporated the exchange during the Bitcoin’s bull run from December 2017.

In May 2019, BCSC had started to investigate the exchange’s customer complaints. Grant Thornton has notified the US and Canadian banks where Gokturk and Einstein Exchange have made deposits and investments or had shares in the private sector.

Exchange Says it Owes Clients $10 Million or Less

Gokturk didn’t comment or respond to the allegations in the BCSC case against Einstein Exchange. According to a report, the Einstein Group has informed Grant Thornton that it thinks its clients are owed somewhere between $8 and $10 million.

It also says the deficit is the result of bank draft and credit card frauds, with the loss being almost entirely made up of crypto assets. It’s believed Einstein Exchange has served around 200,000 people from all over the world. However, Grant Thornton has only heard from somewhere in between 200 and 300 users so far. This doesn’t mean more complaints won’t still be filed.

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Author: Oana Ularu