Blockchain and Brexit: How Adoption Could Help With UK–EU Relations

Blockchain has one new supporter: the UK finance minister Philip Hammond. Quizzed at the Conservative Party conference on how the UK government might solve Brexit’s UK-Irish border issue, he suggested that blockchain technology may be a solution.

“There is technology becoming available […] I don’t claim to be an expert on it but the most obvious technology is blockchain.”

He didn’t go into any further detail, but in raising distributed ledger technology (DLT) as one way of facilitating ‘frictionless’ movement between Northern Ireland and the Republic of Ireland, he sparked hope that blockchain could help ensure seamless post-Brexit trade between the UK and the EU, and all without requiring Britain to be part of the European Economic Area or the Customs Union.

However, while there is some potential for DLT to be used in a post-Brexit world, there’s still a very long way to go before solutions involving blockchain tech could be rolled out at scale. And more fundamentally, even though the best blockchains ensure an immutable ledger of transactions, there would still remain the eternal issue of the initial reliability of any data entered into them.

Blockchain borders

“In my assessment there is zero chance that blockchain technology will help deliver a ‘frictionless’ border between Northern and the Republic of Ireland,” Vili Lehdonvirta tells Cointelegraph. An associate professor and senior research fellow at the University of Oxford, Lehdonvirta’s recent research has focused on the application of blockchain to the wider global economy. And while he’s familiar with the promises that have been made on behalf of DLT, he’s sceptical as to whether most of these promises will be realized.

“Blockchain has become this magical buzzword that people like Philip Hammond who don’t know what they’re talking about are pinning all kinds of hopes and dreams on. I think the onus is on the proponents to explain how blockchain tech could possibly help here. For starters, we would need to know what exactly is meant by “blockchain” here. If it means a Bitcoin-style peer-to-peer proof-of-work system, then obviously throughput and latency will be big issues, against what expected benefit?”

Indeed, scaling is still currently the nemesis of Bitcoin and other proof-of-work (PoW) blockchains (e.g. Ethereum, Bitcoin Cash, Litecoin, Monero), and while improvements have been made in recent months, it’s still hard to imagine a Bitcoin-style blockchain coping with the immense daily traffic the Irish (and every other EU-UK) border experiences. For instance, an average of around 30,000 people cross the North-South border every day for work, while 35% of Northern Ireland’s exports go to the Republic (worth around £4 billion in 2016). This is a hefty amount of traffic, yet peer-to-peer PoW blockchains aren’t particularly scalable compared to existing systems: Bitcoin can handle a maximum number of seven transactions per second (compared to Visa‘s 50,000+), while Ethereum was notoriously backlogged last December in the wake of CryptoKitties‘ popularity.

Average number of transactions per second

As for private, or ‘permissioned’ blockchains (which are centralized), Lehdonvirta doesn’t think they hold out much promise either. “If it means IBM-style permissioned blockchain, then that’s essentially just a shared database, nothing particularly groundbreaking about that.”

Not only is this not especially groundbreaking, but there’s currently no indication that a private blockchain is noticeably more efficient or effective than a shared database. “If we’re talking about permissioned blockchains, they have yet to prove that they have any benefits over centralized databases, so I don’t see any benefit there,” says Angus C. de Crespigny, EY’s former leader of blockchain and cryptocurrency.

The only good border is no border

This pessimistic assessment of blockchain’s applicability to cross-border trade is shared by other experts. Gary Barnett, Chief Analyst for GlobalData’s Technology Thematic Research Program says:

“Blockchain technology is not well suited to the processing of cross border trade. It is expensive, complex, and slow.”

As Barnett explains to Cointelegraph, the problem isn’t simply one of technological capability, but of relevance:

“Blockchain only becomes useful or interesting in domains where no single participant in a network can take the role of transaction coordinator. In [cross-border trade], whether importers like it or not, the border authorities can take on that role and mandate that importers use whatever system they choose.”

And more fundamentally, there are deep political tensions which weaken the possibility of blockchain ‘solving’ the Irish border issue. Regardless of how efficient, inexpensive and reliable DLT could be become, Irish people on both sides of the divide are likely to be very unhappy with any kind of customs procedure, after having spent two decades (since the Good Friday Agreement in 1998) getting used to passing freely from one country to the other.

Nick Botton, an expert on trade affairs and digital economies at Landmark Public Affairs (and formerly at the European Center for International Political Economy), tells Cointelegraph:

“The Northern Ireland issue is sadly not one that will likely ever be solved via technology, it’s strictly a political issue at this stage. Even if a blockchain customs border were something that could be developed in the next 5 years, which would be able to handle all customs matters perfectly, a border in either Ireland or between Northern Ireland and the rest of the UK would still be impossible to sell to Ireland and Northern Ireland. A border, whether soft or hard, is still a border, which would require policing, so as to prevent fraud and smuggling. Such an arrangement, whether in Ireland or in the sea, would be rejected by both sides of the Irish Island.”

A border (hard or soft) would most likely revive the memory of living during the Troubles, which was defined by a period of violence and a military presence along the Irish border. “It’s dangerous on all sorts of terms,” Dr Katy Hayward said to Business Insider in April.. “Northern Ireland is a unique situation and its sensitivities need to be respected.”

Fundamental issues

When this issue is widened in scope to include the UK’s future trade and relations with the rest of the EU, the prognosis is slightly better, but there are still serious question marks hanging over just what blockchain can offer that existing solutions can’t.

Digital consultancy group Reply published a report in December called “Blockchain for Brexit,” in which it outlined the areas in which DLT could help with post-Brexit UK-EU trade. “The primary contribution of blockchain here is [to] establish a robust and watertight data trail for goods,” the report’s authors wrote, arguing that such a trail would “reduce the need for inspections at the border.”

However, in its report, Reply notes that several conditions and challenges must be met before such a role for blockchain could be realized:

“In other words, to use blockchain properly, it’s not enough to maintain a record of the origin of an item. You have to have a complete record of all transactions involving the item, including inspections. This means adding to the blockchain at every link in the supply chain.”

Maintaining a complete record like this could be labor-intensive, especially when it comes to processing goods. “For example, when a large animal or fish is cut up into pieces, to be sold to multiple consumers. Blockchain can be used to check that the total weight of the pieces is consistent with the original weight of the whole, but again this assumes that all the pieces are tracked.”

An even more serious issue revolves around the assumption that the data initially entered into a blockchain is reliable. For example, a blockchain could tell you that an orange has come from, say, Spain, and that it hasn’t been tampered with or swapped as it made its way across the supply chain, but it can’t guarantee on its own that the person who first registered it on that blockchain was being truthful about its Spanish provenance. It may have actually come from Portugal, which means that we still have to have additional systems in place for determining the trustworthiness of initial records and entries on a distributed ledger.

Angus C. de Crespigny concurs:

“If we’re looking at public blockchains, a blockchain is only as good as the data you put in it, and to come to an agreement on what data is put in, we need to coordinate people to begin with. Blockchains are regularly sold as ways to coordinate diverse groups of people, however this coordination is a people issue, not a technology issue. Once you can coordinate people, there is almost always a better technology to use than a blockchain.”

Irrespective of whether other technologies are better, they already appear to have a head start over blockchain, thereby reducing the likelihood that the UK government will seriously look into implementing DLT. “HMRC [Her Majesty’s Revenue & Customs, the UK’s tax service] is already in the process of rolling out the first phases of a major digitization program (the Customs Declaration Service),” concludes Gary Barnett, underlining the possibility that Philip Hammond’s remarks may be out of step with the rest of his government.

“[This] represents a multi-year investment of several million pounds, but which effectively extends the functionality of the already existing digital customs system. This could be adapted to cope with the increased volume of customs declarations […] At this stage, adding blockchain technology to the mix would effectively add to the risk and delay the project.”

Ethereum: We Haven’t Seen the Last of the Bug That Killed the DAO

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More than two years after the collapse of The DAO thrust the Ethereum community into civil war, one of the bugs that caused that caused that black swan event continues to lurk in many smart contracts, waiting to be exploited by hackers.

That’s according to Emin Gün Sirer‏, a computer science professor at Cornell and the co-director of cryptocurrency research initiative IC3, who said that he has seen a variety of smart contracts that may be vulnerable to a “reentrancy” attack that allows a malicious user to drain ETH from a payment channel.

“BTW, I’ve seen other contracts like this one that implicitly trust the erc-20 tokens issued on top of their platform to not perform reentrant calls. I’m sure this isn’t the last episode of this bug,” he wrote on Twitter.

Sirer was commenting on the news that SpankChain, an adult entertainment startup whose platform runs partially on Ethereum smart contracts, had been hacked for nearly $40,000 worth of cryptocurrency over the weekend.

As CCN reported, the company said that the hacker used a reentrancy attack to siphon 1165.38 ETH out of the smart contract over a series of transactions. In short, the attacker used a malicious smart contract to trick the SpankChain contract into believing that the attacker could withdraw funds from the payment channel.

The firm explained:

“The attacker created a malicious contract masquerading as an ERC20 token, where the ‘transfer’ function called back into the payment channel contract multiple times, draining some ETH each time.”

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As both Spankchain and Sirer noted, the attack was similar to the one that crippled The DAO, a decentralized venture capital fund that long held the record for most funds raised by an initial coin offering (ICO).

Worth as much as $150 million at a time when the total market cap of ethereum was still far below $2 billion, The DAO held nearly 15 percent of the total ETH supply on June 17, 2016, when an attacker stole 3.6 million ETH — today worth nearly $815 million — by exploiting its vulnerable smart contract.

We all know what happened next: a series of futile attempts to recover the funds, the infamous chat room conversation, and the contentious hard fork that resulted in the creation of Ethereum Classic.

Now, more than two years later, Ethereum has largely put The DAO hack in its rearview mirror. The ethereum price, which plunged as low as $6 in the months following the hack, now stands at $230. Hundreds of blockchain startups have used Ethereum to raise billions of dollars through ICOs, and thousands of developers are building decentralized applications (dApps) that run on the platform.

However, though the consequences may not always be quite as serious as they were on that infamous morning in June 2016, the bug that permanently altered the cryptocurrency landscape appears determined to continue to rear its ugly head.

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Hacked Japanese Crypto Exchange Zaif Releases Financial Support Plan for Customer Assets

Hacked Japanese cryptocurrency exchange Zaif has announced an official plan to provide financial support for affected customers’ assets, in an official notice posted today, October 10.

As previously reported, the exchange suffered a security breach Sept. 14, resulting in total losses of cryptocurrencies worth 6.7 billion yen (around $59.7 million).

At the time, Zaif operator Tech Bureau Inc. indicated it would be working with Fisco Digital Asset Group to draft a joint support plan.

Today’s notice clarifies that the terms of the basic agreement between the two firms have been in formal negotiation as of Sept. 20., and initially stipulated that Fisco would provide “financial support of 5 billion yen, enter a capital alliance enabling acquisition of a majority of the Company’s shares and allow for a majority of directors and the dispatch of an auditor.”

Tech Bureau today states that some of the initial terms have now been changed in the two firms’ final agreement. The notice declares that both firms are primarily focused on pursuing “the business transfer method,” from the viewpoint of both avoiding risk for Fisco, as well as the urgency of implementing a decision “rapidly to protect customers.”

Tech Bureau affirms that an agreement has been successfully concluded to “transfer the business of cryptocurrency exchange Zaif to Fisco Cryptocurrency Exchange.”

As per the now “legally stipulated” procedures, Tech Bureau states it will hold a general meeting for shareholders on Nov. 19, with the date of the business transfer to Fisco set for Nov. 22.

Under the final terms, Fisco will reportedly assume customers’ rights to receiving a return of all deposited cryptocurrency, stating that “[c]ompensation for some Monacoin will be made in Japanese yen.”

The notice outlines that compensation for affected Monacoin holders will be made in Japanese yen, at a rate of 144.548 yen ($1.28) per Monacoin. Compromised holdings will be reportedly be compensated 60 percent in crypto (at the specified rate) and 40 percent in fiat currency.

Moreover, all Monacoin transactions on the Zaif platform will cease completely as of today, Oct. 10, at 5 p.m. Announcements are reportedly to be made at a later date regarding the resumption of transactions, as well as when compensation withdrawals for compromised Monacoin holdings will commence.  

With regards to Bitcoin (BTC) and Bitcoin Cash (BCH) transactions, all buying and selling shall reportedly continue “as normal” on the Zaif platform as of today, whereas deposit and withdrawal services are scheduled to resume after operations have been assumed by Fisco, with a precise date yet to be announced.

As recently reported, Japan’s Financial Services Agency (FSA) issued its third business improvement order to Tech Bureau at the end of September. The watchdog had already ordered the firm to make business improvements first in March, and subsequently in June this year.

Coinbase: Japan’s Crackdown on Cryptocurrency ‘Good for Us’

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Cryptocurrency exchange giant Coinbase isn’t concerned that Japan’s Financial Services Agency (FSA) has begun to view the crypto trading industry with a more cautious eye in the wake of several high profile exchange hacks on the regulatory agency’s watch in 2018.

Speaking with the Nikkei Asian Review, Mike Lempres, Coinbase’s chief policy officer, said that increased scrutiny of cryptocurrency exchanges applying for virtual currency licenses is Japan was actually a good thing for the San Francisco-based company because it would give them a leg up on the competition.

“The Japanese government is more focused on security,” he said. “That is good for us.” Discussions with the FSA are “going well,” he continued. “We are… committed to getting it done. It will certainly be in 2019.”

That’s a bold claim, particularly considering that, as Nikkei notes, the FSA has not approved a virtual currency license since Dec. 2017, shortly before Tokyo-based exchange Coincheck was hacked for a record $530 million in Jan. 2018. Last month, Osaka-headquartered trading platform Zaif lost $60 million following a hack and is now struggling to compensate customers.

Coinbase believes those hacks, rather than make regulators and investors hesitant to engage with the still-nascent cryptocurrency industry, will increase demand for firms with a trustworthy track record.

“Japan has been an active large market from the very beginning, and has proved resilient as it bounces back from several bad experiences,” Lempres said. “We think there is great demand for a trusted provider of services here.”

Lempres explained that Coinbase devotes far more resources to securing client assets than many other cryptocurrency exchanges, with “dozens” of the firm’s 550 employees working full-time on asset security.

Indeed, a recent profile in Wired detailed the lengths to which Coinbase goes to secure cryptocurrency assets stored in its custodial “vault,” pop-up Faraday cages and all. Lempres further explained that just one percent of the company’s funds are held in online “hot wallets,” with the remaining 99 percent secured in cold storage. Moreover, those one percent of funds that are stored in Coinbase’s hot wallet are fully-insured.

However, though a global company with operations in dozens of countries, Coinbase’s security apparatus is centered in the U.S., which could lead to problems if the FSA says that it wants Coinbase Japan to physically store its assets in Japan, where the agency can more easily monitor them.

“We have everything built to protect our storage… in the U.S.,” said Lempres. “We won’t do anything to even raise possibility of a hack. It would be hard for us to duplicate what we do in the U.S. today in Japan and other countries.”

CCN reported in June that Coinbase was plotting an expansion into Japan, with the exchange operator tapping former Morgan Stanley Japan investment banker Nao Kitazawa to serve as chief executive of Coinbase Japan.

“As in other markets, we plan to take a deliberate approach to our rollout in Japan, which means working hand-in-hand with the Japanese FSA to ensure compliance with local laws at every stage,” the firm said at the time.

Last week, reports emerged that Tiger Global, a major U.K. hedge fund, was close to completing a $500 million investment in Coinbase. Various reports differed on whether the fund was purchasing shares directly from Coinbase or on the secondary market, but in one respect they all agreed: the investment would value Coinbase at $8 billion, cementing its status as not only one of the largest cryptocurrency companies but also one of the world’s most valuable privately-held tech companies.

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Brazil Tops List of Cryptojacking Coinhive Victims, Iranian Cybersecurity Authority Warns

The highest number of recorded incidents of Coinhive cryptojacking software have taken place in Brazil, Iran’s country’s cybersecurity authority revealed in a report Monday, October 8.

According to the Iranian authority’s report on malware in 2017, Brazil, the country with the most reported cases, has been hit over 81,000 times by Coinhive. India came in second with around 29,000, followed by Indonesia with more than 23,000, while Iran scored about 11,000.

Coinhive, the cryptocurrency mining software which mines Monero (XMR), provides an Application Programming Interface (API) to developers, which then lets the developer use a website visitors’ CPU resources to mine the privacy-centered altcoin.

According to a study in May, around 300 websites worldwide contained malicious code which would lead to a device becoming infected with Coinhive without users’ knowledge. More recently, the software has been removed from League of Legends Philippines, and police in Japan investigated a cryptojacking case with Coinhive used as malware.

Relating to Iran specifically, CERTCC found the capital Tehran to be most contaminated with 606 reports, followed by Esfahan with 244.

“It is expected to be one of the security challenges in years to come,” the report’s authors forecast.

As Cointelegraph has reported, overall cryptojacking malware reports surged almost 500 percent in 2018. According to calculations in June, around 5 percent of the total circulating Monero supply was mined using such illicit techniques.

$6.4 Million of Thai Actor’s Family Assets Seized in $24 Million Bitcoin Fraud Case

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Ten months after a Finnish national filed a complaint after losing 5,564 bitcoins to fraudsters in Thailand, the family of the Thai television actor Jiratpisit ‘Boom’ Jaravijit is now the target of the country’s anti-money laundering agency in relation to the scam.

According to The Nation, Thailand’s Anti-Money Laundering Office (AMLO) has seized assets worth 210 million baht (approximately US$6.4 million) belonging to the Jaravijit family over their involvement in the bitcoin fraud case in which a Finnish national, Aarni Otava Saarimaa, lost bitcoins which were worth approximately US$24 million at the time the crime occurred.

Bank Accounts and Land

Per the AMLO, the assets which have been seized from Jiratpisit include five bank accounts. Two of the bank accounts had a combined balance of around 4 million baht. Additionally, a plot of land registered in the actor’s name estimated to be worth 43 million baht was also seized bringing the combined value of his seized assets to 47 million baht (US$1.4 million).

Other members of the Jaravijit family whose assets were also seized include the actor’s elder brother, Prinya Jaravijit, and the sister, Supitcha Jaravijit. Just like with Jiratpisit, the assets seized in the case of Prinya and Supitcha were also bank accounts and plots of land. Assets belonging to other non-members of the Jaravijit family believed to have acted as accomplices or accessories to the crime were also confiscated.

The decision to confiscate the assets was made by the transaction committee of the anti-money laundering agency which resolved to seize 64 items in addition to interest. The confiscation order will be in effect for a period of 90 days, running from August 14 to November 11, 2018. According to the AMLO, victims of wrongful seizures will have an opportunity to lodge an appeal.

“Anyone whose assets are unrelated to the alleged wrongdoing and wrongly confiscated may file their appeal with the AMLO secretary-general within 30 days of learning about this order,” said the anti-money laundering agency.

The Genesis

As previously reported by CCN, the scheme to defraud Saarimaa was allegedly masterminded by Prinya who is said to have invited the Finn to make an assortment of investments including stocks listed on the Stock Exchange of Thailand as well as in two companies NX Chain Inc and Expay Software. Saarimaa went on to transfer his bitcoin holdings worth 797 million baht at the time (approximately US$24 million) to Prinya’s wallet.

But instead of making the investments as promised, Prinya diverted the funds to bank accounts belonging mostly to members of his family with some of the money being used to buy parcels of land. Saarimaa filed a complaint with the Thai police in January this year.

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One Blockchain To Rule Them All: Congressmen’s Mission to Define The Technology

Last week, two US lawmakers introduced a bill dubbed the “Blockchain Promotional Act 2018” in the House of Representatives. Its main purpose is to establish a common definition of ‘blockchain’ technology along with a blockchain working group that would potentially overview studies for federal adoption of the technology.

Here’s what the bill might mean for the US regulatory landscape, which has been (albeit significantly slowly) moving towards recognizing the industry over the past few months.

What do we know about the ‘Blockchain Promotional Act 2018’?

The document was introduced by two members of the House of Representatives — California democrat Doris Matsui and Kentucky republican Brett Guthrie — on September 26. Matsui first announced she was working on such legislation during a House Energy and Commerce Committee Subcommittee on Digital Commerce and Consumer Protection hearing in July 2018:

“I’ve discussed the potential of blockchain applications in this subcommittee before,” Matsui stated. “These include its possibility to facilitate spectrum sharing as next generation broadband networks are deployed, maintain patient health records, and secure business transactions and communications between Internet of Things networks.”

Further, Matsui stressed that she believes a common definition will help drive innovation and ease deployment across both the public and private sectors, while the technology’s growing popularity leads to distortion of its definition:

“In its basic and essential element and function, blockchain is a decentralized ledger technology […] But as the hype surrounding blockchain and its applications grow, how exactly blockchain is defined has become less clear. More fundamentally, there is no agreed upon definition of ‘blockchain.’”

Why a common definition of blockchain is important for the regulatory landscape

Matsui and Guthrie’s bipartisan bill follows the Information Security and Privacy Advisory Board (ISPAB) meeting that occured on June 25. During the session,

Tiffany Angulo, a staff co-chair of the Congressional Blockchain Caucus (a platform for the industry and government collaboration to examine the implications of blockchain and virtual currencies), warned that blockchain development could turn into a “patchwork system”, because states pass laws with different definitions of the technology. Angulo argued that blockchain required greater federal guidance and standardization to ensure that the technology is applicable across the nation:

“If you’re an insurance broker and you have contracts in different states, you’re going to have different regulations in each state.”

Interestingly, California, and Arizona, two states who have passed their blockchain-related bills, have used the same definition of blockchain. Thus, both California’s Assembly Bill 2658 and Arizona’s House Bill 2602 define blockchain technology as a “distributed ledger technology that uses a distributed, decentralized, shared, and reciprocal ledger, that may be public or private, permissioned or permissionless, or driven by tokenized crypto economics or tokenless. The data on the ledger is protected with cryptography, is immutable, is auditable, and provides an uncensored truth.”

How the ‘Blockchain Promotional Act 2018’ attempts to tackle blockchain-related issues

The new bill proposes that the U.S. Department of Commerce create a working group formed both by federal officials and members of the blockchain industry to form a common definition of blockchain.

According to the press release published on Matsui’s website, the working group will also consider recommendations for the National Telecommunications and Information Administration (NTIA) and Federal Communications Commission (FCC) to study the potential impact of blockchain on spectrum policy and opportunities for federal adoption of the technology. Matsui further explained the main purpose of the bill, citing the technology’s potential:

“Blockchain technology could transform the global digital economy. Opportunities to deploy blockchain technology ranges from greatly increased transparency, efficiencies and security in supply chains to more-opportunistically managing access to spectrum.”

More action in Congress: the long road to federal regulation

Matsui and Guthrie join other congresspeople who have been calling for federal legislation for cryptocurrencies and blockchain. Thus, in September, Minnesota republican Tom Emmer who is also a co-chair of the Congressional Blockchain Caucus, announced three upcoming bills on the matter.

Dubbed the “Resolution Supporting Digital Currencies and Blockchain Technology” the “Blockchain Regulatory Certainty Act” and the “Safe Harbor for Taxpayers with Forked Assets Act”, the legislations focus on the support and development of blockchain, as well as the establishment of a safe harbor for taxpayers with “forked” digital assets. Emmer further commented on the initiative:

“The United States should prioritize accelerating the development of blockchain technology and create an environment that enables the American private sector to lead on innovation and further growth, which is why I am introducing these bills.”

Around the same time, a group of more than a dozen lawmakers from Congress sent a letter to Securities and Exchange Commission (SEC) Chairman Jay Clayton, calling for regulatory clarity regarding cryptocurrencies. The congressmen urged Clayton to tell investors how the SEC plans to regulate virtual currencies:

“It is important that all policy makers work toward developing clearer guidelines between those digital tokens that are securities, and those that are not, through better articulation of SEC policy, and, ultimately, through formal guidance or legislation.”

Ironically, it seems that the current problem with regulation in the US is two-sided: regulating bodies like the SEC and Commodity Futures Trading Commission (CFTC), whom congressmen ask for clarity on their stance towards cryptocurrencies, have been continuously extending their purview within the crypto industry during the past few months.

However, they move with extra caution, citing the absence of comprehensive crypto legislation coming anytime soon. For instance, CFTC’s Chairman Christopher Giancarlo have stated that he doesn’t see such a framework coming from the federal level in the near future, pointing out that the statutes by which the CFTC is operating were written in 1935, and embracing something “as new and as innovative” as Bitcoin within such terms will take time.

The bipartisan bill introduced by Matsui and Guthrie, if approved, could ease government’s interaction with blockchain and potentially make the industry more attractive for local mainstream businesses who will get an official definition for the technology, and thus more options to explore it.

Nevertheless, it is impossible to tell if the bill is going to be approved at this point, and what precise impact it will have on the US legal system and crypto market. Cointelegraph has reached out to the DC-based non-profit industry-oriented outlets Blockchain Association and Coin Center for further comment. The latter has not replied to date, while the Blockchain Association representative limited his answer by sharing the following statement:

“We believe in the transformative potential of this technology and as this new working group comes together we look forward to continued collaboration with Congress to push for responsive regulation that spurs innovation and protects consumers.”

Singapore’s Central Bank Will Aid Crypto Startups in Opening Bank Accounts

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Ravi Menon, the chief of Singapore’s defacto central bank and regulator, has backed domestic cryptocurrency startups and exchanges to gain banking services in the technology-forward city-state.

Monetary Institute of Singapore (MAS) managing director Ravi Menon has called for the banking industry to get over the “hurdle” of offering services to domestic cryptocurrency startups in a marked attempt to foster the fintech industry.

Speaking to Bloomberg, Menon said that while Singapore will not be “an extremely lax regulatory environment” for crypto industry firms locally and beyond, there could be respite coming for startups who have banks reluctant to offer simple banking services like opening banking accounts.

The central bank official stated:

What we are trying to do is to bring the banks and cryptocurrency fintech startups together to see if there is some understanding they can reach.

The embracive, if cautious, approach is a significant contrast to the likes of India, wherein the central bank forced all regulated financial institutions – including banks – to cease offering services to cryptocurrency firms. The Indian central bank’s move has largely dented the industry, leading to the closure of one of India’s biggest cryptocurrency exchanges recently.

For a senior central bank official, Menon has ruled out regulation for decentralized open cryptocurrencies like bitcoin in the past, insisting that bitcoin “itself does not pose the risk that warrants regulation”.

“Our approach is to look at the activity around the cryptocurrency and then make an assessment of what regulation would be suitable,” he said last year, calling for oversight into activities that could abuse cryptocurrencies.

As cryptocurrency markets touched an all-time high earlier in January, driven by a bull-run through much of 2017, Menon sought to bring attention to the “good applications” of cryptocurrencies citing cheap, real-time, international remittance as an example.

“I do hope when the fever has gone away, when the crash has happened, it will not undermine the much deeper, and more meaningful technology associated with digital currencies and blockchain,” Menon said earlier this year.

The permissive ecosystem has seen Upbit, South Korea’s largest cryptocurrency exchange, establish a new cryptocurrency exchange in Singapore last month. Binance, the world’s largest cryptocurrency exchange by trading volume, also announced plans to launch a fiat cryptocurrency exchange in Singapore.

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Blythe Masters: ‘Hundreds’ of Blockchain Benefits Will Hit Commodity Supply Chains

Former JPMorgan executive Blythe Masters predicts “tens if not hundreds” of blockchain projects will soon increase the efficiency of commodity markets, Bloomberg reports Tuesday, Oct. 9.

Masters, who since leaving the investment banking giant has become CEO of her own software outfit Digital Asset Holdings, said commodity supply chains would greatly benefit from the advent of distributed ledger technology.

“Supply chains are notoriously complex and inefficient,” she told attendees of the invite-only London Metal Exchange (LME) annual dinner, quoted by Bloomberg.

As Cointelegraph has reported, the supply chain aspect of various global industries from shipping to agriculture has formed a focus for blockchain-based solutions involving many major corporations, including most recently Walmart and IBM.

While not everyone shares the opinion that blockchain tech is ready for mainstream implementation, the technology looks set to benefit legacy structures by simplifying bureaucracy, increasing confidentially, and boosting productivity, Blythe noted.

Masters’ Digital Asset Holdings is similarly designing software to aid the sector in blockchain implementation, she said at the LME event, involving banks and investors among other participants trading bonds and assets. Bloomberg notes that the LME market still sets prices via an open-outcry trading ring.

Having taken a proactive role in promoting both Bitcoin (BTC) and blockchain, Masters joined advocacy group the Chamber of Digital Commerce’s board of advisors in 2015.

Binance Delists 4 Cryptocurrencies, Sending All of Them Crashing

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As of yesterday, October 9th, 2018, Binance, one of the world’s largest and most popular cryptocurrency exchanges, has announced that they will be delisting four tokens from their trading platform until further notice.

The announcement was made early yesterday morning on the exchange’s website and stated that due to the Binance team’s dedication to protecting the safety of their users, they would be de-listing Bytecoin (BCN), ChatCoin (CHAT), Iconomi (ICN), and Triggers (TRIG). The release of the notice has sent most of the coins crashing down pretty hard.

In the press release, the team affirmed their dedication to keeping their clients and users safe and explained that to maintain this level of user safety, the team regularly conducts comprehensive reviews of the digital assets listed on the platform.

They also mentioned that when certain coins or tokens fall below a certain level of quality, they are either reviewed in-depth or de-listed entirely from the exchange. This practice allows them to maintain some quality when it comes to the coins endorsed by the exchange.

Another delisting, another crash

The release of the announcement has undoubtfully sent some of the coins crashing down — something that we see very often with delistings, especially from major crypto exchanges. This is just another proof of how cryptocurrencies’ prices are closely related to their listings on major exchanges.

ChatCoin has declined with 30% since the delisting announcement, trading at $0.016 per coin. Binance market pairs with CHAT accounted for $4.9 million of the $7.54 million trading volume of the coin for the past 24 hours.

Bytecoin has seen a decline by nearly 22% since the announcement, trading at $0.017. Binance market pairs with BCN accounted for $10.85 million of the $18.73 million trading volume of the coin for the past 24 hours.

Triggers has seen a decline by nearly 49% since the announcement, trading at $0.155. Binance market pairs with TRIG accounted for 100% of the $9.82 million trading volume of the coin for the past 24 hours.

Iconomi has seen a decline by nearly 9% since the announcement, trading at $0.36. Binance market pairs with ICN accounted for $1.25 million of the $1.65 million trading volume of the coin for the past 24 hours.

Quality Assurance

While they have not officially released the reasons for de-listing the four tokens, they have indirectly mentioned that the projects have somehow fallen below their ideal standards of quality.

Below, are some of the factors that the Binance team considers when assessing the quality of their listed tokens:

  • A team’s commitment to the project
  • Quality and level of development activity
  • Network/smart contract stability
  • Level of public communication and activity
  • Responsiveness to our periodic due diligence
  • Evidence of unethical/fraudulent conduct
  • Contribution to a healthy and sustainable crypto ecosystem

Delisted Until Further Notice

According to Biance, Based on the above criteria, we have decided to delist and cease trading on all trading pairs for the following coins and tokens: Bytecoin (BCN), ChatCoin (CHAT), Iconomi (ICN), Triggers (TRIG).”

The coins are set to be de-listed and removed from the platform by October 12, 2018, at 10:00 AM and the team says that they will continue to support the removal of the aforementioned coins until November 12, 2018, at 10:00 AM.

The move has been made to help create a “healthy and sustainable crypto ecosystem.” And, Binance ended by stating that they will continue to protect their users’ safety by performing periodic reviews of all coins and tokens listed on the platform.

In other news, the Binance platform has also re-routed all of their trading fees to charity, as well as announcing the launch of a new, de-centralized platform by the end of 2018, where the Binance Token (BNB) will be used as the operational token to power the platform’s smart contracts.

Featured Image from Shutterstock. Charts from TradingView.

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