Author: Ed Drake

Bitcoin SV version 0.1 goes live

Leading blockchain technology research and development outfit nChain has rolled out the beta release of its Bitcoin SV alpha client on October 15—one month ahead of the November Bitcoin Cash (BCH) network upgrade.

Available on GitHub, the Bitcoin SV 0.1 version includes support for the November upgrade, including the re-enabling of the OP_MUL, OP_INVERT, OP_LSHIFT, and OP_RSHIFT OP_Codes. The default maximum size of accept blocks has also been finally increased from the 32MB soft limit to 128MB.

Notably, this release has increased the limit on the number of opcodes from 201 to 500 per script, which will take effect after the upgrade. It has also disabled several features, such as the automatic replay feature, the activation logic for the May 2018 upgrade, and the graphic user interface (GUI). The beta version also reduced the maximum size of P2P messages to be closer to the excessive block size (EB) parameter.

Bitcoin SV, which stands for Satoshi’s Vision, is an open source software that enables the use of Bitcoin BCH. Considered one of the most promising Bitcoin BCH node implementation, Bitcoin SV is a project born out of the desire to empower miners so they’ll make informed decisions about critical protocol upgrades. Contrary to widely held belief, Bitcoin SV is not a fork—it will lock the “battle-tested” Bitcoin BCH protocol in place. In turn, miners will have a choice and a voice to drive the process of restoring Bitcoin to its optimal state. That of unbounded blocks and original OP_Codes.

The Bitcoin SV project was created at the request of and sponsored by Antiguan-based CoinGeek Mining, with development work initiated by nChain. The project is also owned by the Antiguan-based bComm Association on behalf of the global BCH community, and the Bitcoin SV code is made available under the open source MIT license.

This November, mining nodes running Bitcoin SV will enable the short list of upgrades on the BCH network, the most important of which is increasing the default maximum block size from 32MB to 128MB. But why now? The reason, according to nChain CEO Jimmy Nguyen is simple: There’s a direct economic need for miners.

At the recently held The Future of Bitcoin Summit Bangkok 2018 in Thailand, Nguyen explained why it is important for the block size to scale now—and scale fast: “In two years the block reward will be split in half again to 6.25 BCH. So anyone who’s mining now will in two years receive half of what they’re receiving today. In order to maintain even current profitability, what that means is in two years they have to make up that 6.25 coins worth of value in something else, which has to come in transaction fees and which has to come in higher transaction volume.”

Explore the features of Bitcoin SV version 0.1 here, and be part of the Miner’s Choice movement for Bitcoin BCH.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Adult industry payment platform saves own ass after getting spanked

SpankChain, blockchain-based payment service solution for the adult industry, has disclosed the details of a hack that resulted in losses equivalent to $38,000.

As a result of a broken smart contract, a hacker was able to break into the SpankChain platform and siphon funds from some of its users, through deploying a reentrancy bug—the same bug that has previously been used to attack the DAO.

The scam saw losses of 165.38 ETH, as well as $4,000 worth of BOOTY on the platform immobilized, with the total balance divided between SpankChain and some of its users, with the organisation coming in for sharp criticism over the event.

Explaining the nuts and bolts of the attack, the firm posted an update on Medium: “In short, the attack capitalized on a ‘reentrancy’ bug, much like the one exploited in The DAO. 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.”

According to SpankChain, “The malicious contract first called createChannel to set up the channel, then called LCOpenTimeout repeatedly via reentrancy. The LCOpenTimeout is there to allow users to quickly exit payment channels which have not yet been joined by the counter-party.”

On Thursday, SpankChain CEO Ameen Soleimani confirmed that “the stuck BOOTY has been recovered.”

The now-resolved SpankChain hack comes as only the latest example of a significant hacking event affecting a crypto platform, with scams and hacks rapidly increasing in number over the last few months.

SpankChain acknowledged that it could have commissioned a security audit on the smart contract, which may have identified the weakness before it was exploited. However, this would have cost around $50,000, more than the total of the losses incurred.

Either way, SpankChain committed to tightening security as it continues to expand, saying, “As we move forward and grow, we will be stepping up our security practices, and making sure to get multiple internal audits for any smart contract code we publish, as well as at least one professional external audit.”

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Bitfinex pulls fiat deposits amid latest crypto price freefall

Cryptocurrency exchange Bitfinex has suspended fiat deposits, apparently on a temporary basis, amid the latest significant sell-off in the BTC markets.

The exchange, which operates from Hong Kong, was reported to have pulled the plug on wire deposits in GBP, USD, EUR and JPY, according to The Block. Unverified social media posts from customers at Bitfinex noted the situation is expected to be resolved within a week.

The suspension raises further questions about goings on at the exchange, after it was suggested Bitfinex may have been holding funds in Puerto Rico’s struggling Noble Bank. It was subsequently revealed that the firm had reached a banking relationship with HSBC.

However, it has since been reported that HSBC may not have been aware it was handling banking for Bitfinex, which had been operating through a subsidiary. This has led some analysts to consider whether the withdrawal of deposit services came as a result of this relationship being pulled by the bank.

On Thursday, BTC was trading at a premium on Bitfinex over other exchanges, a factor some have attributed to the ongoing uncertainty swirling around the exchange. The latest developments come after weeks of rumours around the financial health of the exchange, with critics pointing to the exchange’s ties to struggling stablecoin Tether (USDT).

In a post published by the exchange this week, they rubbished the claims about their financial health, saying, “How any rational party can claim insolvency when the opposite is there for all to see is interesting and, once again, perhaps indicative of a targeted campaign based on nothing but fiction.”

According to Bitfinex, “Complications continue to exist for us in the domain of fiat transactions, as they do for most cryptocurrency-related organisations. However, we continue to do our utmost to minimise any waiting times associated with fiat deposits and withdrawals.”

Questions are now being asked of the sustainability of withdrawals on the platform, which have to date been unaffected by these events.

However, with this perhaps only the latest chapter in Bitfinex’s now farcical search for a banking partner, it remains to be seen whether the Hong Kong-operated exchange can continue to carry the confidence of its customers.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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SEC wants subpoena enforced in $100M Cherubim ICO probe

The U.S. Securities and Exchange Commission (SEC) is taking steps to enforce a subpoena against an investment company and its sole trustee, over allegations of their fraudulent involvement in a $100-million initial coin offering (ICO).

In a statement published this week, the securities regulator said it was asking a district court to assist in enforcement action, as it continues to examine whether Jeffre James and Saint James Holding and Investment Company was involved in a “pump and dump” scheme around shares in Cherubim Interests, Inc.

The commission said it had reason to suspect Cherubim had misled investors around the SJTCoin. In particular, they suggest false public statements had been used to generate significant demand pressures in the market for Cherubim shares, which were later exploited by the Saint James and their trustee.

SEC said following its ongoing investigation, it has reason to believe that in a bid to “pump” its stock price, Cherubim issued false public statements in January 2018 claiming that the company had executed a $100,000,000 financing commitment to launch an ICO for St. James Trust.

“After Cherubim’s stock price and trading volume increased on this news, certain individuals associated with the company may have ‘dumped’ their overvalued Cherubim stock for significant profits,” according to the regulator.

Despite being personally served with court documents, neither James nor Saint James have responded to date. As a result, the SEC has now progressed matters through the courts, in a bid to obtain the requested documents from both parties.

The SEC said it is seeking “an order from the court compelling James and St. James Trust to produce all responsive documents.” The court must now decide whether to compel the parties to cooperate, in submitted the documents requested under the subpoena.

The news is in line with the SEC’s warning issued back in August 2017 that it would pursue those using ICOs to defraud and scam unsuspecting crypto investors.

It marks the latest high profile case involving the SEC, as the regulator continues to make its presence felt around dubious investments and outright scams blighting the cryptocurrency sector.

It remains to be seen whether Saint James, or Jeffre James himself, will now step up their cooperation with the authorities investigating the issue.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Indian authorities track down prolific ‘Kassh coin’ crypto scammer

Authorities in India have finally caught up with a prolific cryptocurrency scam artist, alleged to have been involved in a number of scams affecting dozens of investors in the country.

In a major coup for law enforcement agencies, Asif Ashraf Malkani was finally arrested after several months on the run, following complaints to police from aggrieved investors in his cryptocurrency scams, Times of India  reported.

The first, known as Kassh Coin, was launched two years ago at a lavish function, where Malkani hired models and dancers to entertain guests—including notable Bollywood celebrities. The air of credibility, however, was short lived after investors soon began complaining of a lack of the returns they were promised for investing in the project.

Over the last few weeks, authorities identified Malkani had moved to Uttar Pradesh, where he had been involved in running similar alleged scam—this time around a new cryptocurrency, dubbed V-flix.

Investigators said Malkani was also found to have been soliciting investment for a “commercially viable” video streaming service he had called V-Tube when authorities tracked him down. According to their findings, Malkani had also been involved in sending substantial bank transactions through his fake company, Puneet Enterprises.

After the initial success of their launch event, Malkani set up a number of satellite events across India and into Nepal, including “youth seminars,” designed to stoke interest from younger investors.

However, after Malkani and his co-conspirators withdrew their funds and disappeared, anger had been mounting amongst those caught up in his latest scam. His previous career track record looks equally dubious, with known involvement in several other scams and high profile frauds, including around real-estate and chain-marketing scams.

His arrest was confirmed by senior officers earlier this week. The case is just the latest example of a scammer turning to the crypto sector to cash in on unsuspecting investors.

The case shows the difficulties for investors in largely unregulated crypto markets, with countless instances of unsuspecting individuals being caught out by investment frauds linked to the sector.

Coupled with the threats inherent in older cryptocurrencies, perhaps most prominent with BTC, the case shows safety should still be a priority for anyone looking to get involved in investing in cryptocurrency.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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QuadrigaCX sees $28M frozen as Canada’s ‘banking cartel’ steps up crypto attacks

The mainstream financial world has been outwardly hostile towards cryptocurrencies for some time. Banks in Canada have exemplified this attitude in recent months, withdrawing essential banking services from cryptocurrency businesses while continuing to ratchet up their anti-crypto rhetoric.

Some analysts say this is in response to the direct threat posed to banks and traditional fiat banking systems by cryptocurrencies like Bitcoin, which offer fast international payments, low transaction fees and absolute security without the need for banks or other centralised institutions.

Now, in the latest example of banks taking exception to promising crypto businesses, press reports have revealed that Vancouver-based QuadrigaCX has been facing a freeze on assets worth as much as $28 million.

According to The Globe and Mail, the firm has been unable to access its account funds since January of this year. With the backing of local courts, the Canadian Imperial Bank of Commerce (CIBC) froze a number of accounts connected to the firm, on allegations that it was unable to determine who legally owned the funds.

Subsequently, the bank has asked to court to rule on whether the bank can seize the funds to determine whether they belong to Quadriga, its affected customers, or the firm’s payment processor.

In response to the attacks on their assets, Quadriga has responded robustly, accusing the bank of an orchestrated attempt to squeeze their business for its affiliations with the cryptocurrency sector.

According to legal representatives for the exchange, the implication that Quadriga was involved in unsavoury businesses practices is untrue and “highly offensive.”

“This court should not succumb to the bank’s unsubstantiated and highly offensive speculation that there must be shady dealings afoot because Quadriga’s business is a trading platform for individuals trading in cryptocurrencies.”

In an email sent to customers impacted by the freeze, Quadriga said a “Canadian banking cartel” was intentionally making life difficult for them, and other crypto businesses, to encourage adoption in Canada.

This incident is but the latest in a series of similar swipes at the cryptocurrency sector from banks, both in Canada and further afield.

However, with Quadriga rival Coinsquare recently establishing a formal banking relationship with one of the country’s biggest banks, there remains some optimism that this attitude might be beginning to change, in favour of supporting the development of the nascent crypto sector there.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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FINMA issues landmark Swiss license for crypto asset management

Switzerland’s financial services regulator has issued its first license for cryptocurrency asset management, after greenlighting an application from a domestic cryptocurrency investment fund.

The Swiss Financial Market Supervisory Authority granted licensing approval to Crypto Fund, an investment fund based in Zug, Swissinfo reported. Originally launched in 2017, the fund becomes the first in Switzerland to receive recognition under the new licensing regime.

The move enables crypto fund to offer a wider range of products, which it is expected could help encourage institutional investors into the space. And with the licensing system now officially up and running, the issue confirms Switzerland’s bid to become a ‘Crypto Nation’—a stated aim of the Swiss market amidst growing competition from rival jurisdictions.

Jan Brzezek, CEO of Crypto Fund’s parent company Crypto Finance, welcomed the license, which is seen as a significant win for the company. Brzezek was quoted by the Swiss news outlet saying, “The importance of crypto assets is growing and our aim is to accelerate maturity in these markets. Regulatory recognition remains highly sought after by participants, as seen in recent press and company statements.”

According to local media reports, the success of Crypto Fund could be followed by several others, with a number of firms thought to be progressing applications for the same license. These include applications to offer banking services to the crypto sector, which would solve the current lack of banking provision, and dismantle a considerable barrier to expansion of Zug’s ‘Crypto Valley.’

With the current regulatory setup especially appealing to corporate operators and institutional investors in the sector, the region is already regarded as one of the foremost jurisdictions for blockchain and crypto startups.

The announcement follows on from similar approvals given to a blockchain firm under anti-money laundering laws, by the Financial Services Standards Association, which itself is authorized by FINMA to oversee anti-money laundering compliance.

Zug has also been participating in a number of blockchain trials, including a model for handling municipal votes through a distributed ledger platform.

With the first new license of its kind issued to Crypto Fund, it remains to be seen how many more companies will follow suit, as Switzerland continues to establish its reputation as the cryptocurrency jurisdiction of choice for serious cryptocurrency businesses.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Bittrex launches support for Bitcoin BCH trading in USD markets

Bittrex has added Bitcoin Cash (BCH) support to its USD fiat markets, becoming the latest in a series of major exchanges and merchants to on-board the cryptocurrency in recent weeks.

In yet another vote of confidence for Bitcoin BCH, the U.S.-based Bittrex platform announced the move to its 737,000 followers on Twitter, saying: “Launch Update: Bitcoin Cash (BCH) has been added to the USD (Fiat) markets. Eligible #Bittrex accounts created before September 4 are enabled for trading.”

No initial deposits are required for personal accounts trading with fiat, according to Bittrex, explaining, “If you decide to deposit USD, it is a $1,000 minimum per wire transfer.”

The announcement provides another gateway for retail users as well as investors between U.S. dollar and Bitcoin BCH, as it continues to gain traction as the foremost cryptocurrency of choice for payments. On Reddit, user Twoehy called the announcement “great news,” noting that “Everything that helps wean people off of BTC as some sort of ridiculous crypto ‘reserve currency’ is a good thing.”

Founded in 2013, Bittrex is the 13th largest cryptocurrency exchange by trading volume, and the latest to get behind BCH as the cryptocurrency which most closely reflects Satoshi’s original vision. In particular, the Bittrex platform is renowned for being one of the most secure of its kind, which will appeal to investors looking for a secure, cost-effective cryptocurrency for USD.

It comes at a time of increasing support for Bitcoin, both from merchants and cryptocurrency businesses who value the fast speeds, low costs and enhanced security measures offered by BCH. it also coincides with significant rallies in Bitcoin BCH price this week, as momentum continues to build behind the currency.

Over the last few days, crypto exchange Gemini announced it had been approved to list Bitcoin BCH, with an announcement on a go-live date expected soon. The exchange is run by the Gemini Trust, an organisation founded by the Cameron and Tyler Winklevoss.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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South Korea’s Bithumb to launch decentralized exchange

Bithumb, South Korea’s second biggest cryptocurrency exchange, has announced plans to bring forward a new decentralised exchange in the coming months, in the wake of a similar move from rival Binance.

Bithumb DEX will target global cryptocurrency markets, and is being developed in partnership with One Root Network, which has already pioneered its own DEX which launched earlier this year, Business Korea reported.

According to sources close to the firm, the move is designed to compete with other cryptocurrency exchanges in targeting a global audience for the cryptocurrency brand.

The report noted, “Bithumb is one of the leading global exchanges in terms of transactions but it is true that most of its users are Korean. The latest decision seems to be the company’s strategy to compete with other leading exchanges in the global market by opening a decentralized exchange that receives attention in the global market.”

Cryptocurrency exchanges like Bithumb are traditionally been centralised, earning fees for the platform operator with each transaction. However, in the case of decentralised exchanges, the central party is removed from the transaction, with fees instead delivered by smart contract.

Discussing the scope for decentralised exchanges to become more prominent in future, Binance CEO Changpeng Zhao said that decentralised exchange technology would eventually overtake centralised exchanges.

“I believe that decentralized exchange is the future. I don’t know when that future will come yet. I think we’re at an early stage for that so I don’t know if it’s a year, two years, three years, or five years. I don’t know but we got to be ready for it,” Zhao told CNBC’s Crypto Trader.

Hester Peirce, a commissioner at the U.S. Securities and Exchange Commission, said that investing through crypto exchange platforms required specialists knowledge many investors lack.

“This complexity means that only a very particular type of investor can pursue the diversification opportunities such assets can provide. Entrepreneurs are developing new products through which people can access cryptocurrencies indirectly or hedge their cryptocurrency holdings. Bitcoin futures, for example, began to trade recently,” Perice said.

Decentralised exchanges only exacerbate this issue, and as such, it is expected to appeal to Bithumb’s savvier customers. On the plus side, the decentralised exchange will improve security, by removing the centralised point of weakness—especially important in light of recent hacks of the Bithumb platform.

Although no specific timeline has been published, the new platform is expected to launch over the next few months.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Bitmain resorts to threats over fragile IPO

Our sources tell us that Bitmain executives have promised to “disappear” anyone who crosses them inside China.

While doing the background research for another Bitmain article, our sources told us of the disturbing threats, and we were able to confirm these with our other sources close to Bitmain.

I don’t believe this was a Google translate error, where they meant to say that they’d beat their competitors fair and square in the free marketplace but instead like the old gangsters in Las Vegas, they’d drop them in a hole in the middle of the Nevada desert.

Bitmain released a prospectus, in advance of their long-planned IPO, to lukewarm reviews as the document raised more doubts about the company’s long-term viability.

According to a Medium post by Ken Lu, several points should concern every investor particularly in referring to slide 30 of their investor deck, Bitmain misrepresented its net profit.

To quote Lu, “…misrepresenting this and to such a degree is nothing short of financial fraud.” (You can read the post here.)

The prospectus highlighted the company’s unsold hardware and their warehouses of unsold technology which at a time was the best on the market but has recently been surpassed by new players who are producing faster and more efficient miners leaving the prospects of millions of dollars in inventory going unsold and written down for massive losses.

In recent weeks, Pangolin released its well-received Whatsminer M10 ASIC Miner , while initial test results for the upcoming Squire Miners indicate 1.5x more hashing capabilities while consuming 50% less energy than the top of the line Bitmain ASIC miners.

Interestingly, the Pangolin miner comes from the mind of former Bitmain technologist Yang Zouxing. Bitmain has struggled to replicate the success they had with Yang Zouxing who did the heavy lifting with chip design.

Their inability to combat the corporate brain drain as their top tech minds continue to leave the company have put Bitmain in a dire situation.

Attempting to defraud investors and now issuing veil threats of violence against people who dare compete with them in a free market isn’t the behaviour of a stable and trustworthy company deserving of investors cash.  It’s the behaviour of gangsters who are desperate for money hoping a hail mary IPO will give them some semblance of hope at surviving in this new competitive marketplace.

This all adds smoke to the Bitmain Bankruptcy rumours.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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