31 post tagged

Crypto industry

Airdrop evolution

The airdrop buzzword can be heard numerous times nowadays. Airdrop itself is a popular approach to give away the token to the community.

Airdrop is a popular way to distribute project tokens to the community. So popular that sometimes leads to congestion in the network Ethereum and important commissions in transactions. More recently, this mechanics, which was used to vote on the stock exchange FCoin, has led to sad consequences for the entire network of Ethereum itself. A suitable algorithm allows solving several problems of smart contracts, which operate with extensive lists of users’ addresses. The fact is that putting into the contract a list of even a few thousand addresses and letting this set of addresses do something directly in the contract will not work – in the block, every byte is saved and this is too expensive.

To solve the problem, it is necessary to determine whether the address belongs to the list of “white” addresses in the contract code. If yes, then allow the desired action. The proposed option will enable to solve this problem quite merely by keeping only one number in the contract. The algorithm of brilliant cryptographer Ralph Merkle is widely used in virtually any decentralized software to ensure the integrity of data sets.

Airdrop & ACL

There is such a practice – to release your token and send out its small amounts to tens of thousands of addresses, for which there is, for example, at least 1 ETH. Such spam is extremely popular now to promote your own projects tokens. Few people like the appearance on their balance of someone’s unknown tokens. Nevertheless, the projects need this, and orders for airdrop are prevalent. This is usually done in an old-fashioned way, like this (in the example of Ethereum, but other block contracts with contracts, EOS, for example):

  • Create an address where enough tokens are stored for distribution to all from the list, or they provide in the token contract the ability to create (mint) the required number of tokens to the specified address (when sending the transaction from a particular privileged address);
  • Put on this address is enough Ethereum, enough to pay for the commission for each shipment of tokens to the user;
  • Run a distribution script that iterates through the addresses and for each creates a transaction that transfers (or toms) tokens to the specified address.
    That is, it’s just a pass on the heap of addresses and sending tokens to everyone. In decentralized systems, this push strategy is usually pretty lame, expensive, generates security holes, and generally, it’s spam.

On the commission takes much money (the more addresses, the greater the commission). Besides, at the time of mailing the commission can grow, because the load on the network grows, the cost of the transaction grows too;
Mailing requires writing a script that will send transactions, and the script contains a secret key that gives access to a heap of tokens;

Mailing must be programmed and be able to continue from the place where everything has broken down.

At the same time, the solution is much simpler, which, as is the case in decentralized networks, most of the work is delivered by the software on the client side. This is access control using the Merkle tree – an incredibly convenient data structure to store in the contract only one fixed-size number (merkleRoot), which contains information about all the data included in the tree (about a massive list of recipient addresses, for example).

There is no magic here: information proving that the address is present in the list of allowed, client code provides independently, doing relatively voluminous calculations, and eliminating the need to view a huge list of addresses. The structure of the Merkle tree is extremely useful for a variety of tasks.

So, this algorithm is suitable for creating huge ACL (Access Control List), which allow you to give access to some function of the contract to millions of accounts. To do this, you need to write down a single number in the contract to verify that the account belongs to the list.

Consider the scheme with airdrop, because it is now in high demand on the market and is a demonstrative and straightforward example of smart contracts with large ACLs.

In general, Merkle-proof can be described as “the path that can be traversed from the user’s address in the Merkle tree to Merkle-root itself.”

The Merkle-proof proof consists of log₂N hashes (rounded up to the whole). Each hash is the same size as Merkle-root, which we recorded in a contract-airdrop. That is, for a list of 1024 addresses, the user must provide 10 hashes, and for ~ 4 billion addresses – only 32 hashes. It is in the protocol of construction and presentation of evidence that the main “counter” of the contract hides – the storage of the minimum amount of information to determine the belonging of some data to an extensive list. Also, the more the list is, the higher the gain.

In reality, the contract is supplemented by the ability to take unused tokens, update Merkle root and enter time limits, for example, to prohibit the release of tokens after some time. The contract is quickly updated to distribute an arbitrary number of tokens to each address, in this case, the file contains not just the recipients’ addresses, but also the necessary sums of tokens, and the merkle-proof function is slightly modified, but the general algorithm does not change from this.
Advantages and disadvantages of Merkle-airdrop.

Separately, one can distinguish the advantages and disadvantages of the above method in comparison with the traditional script distribution:

Pros:

The transaction that requires tokens costs little gas, and this number is a constant, depending on the size of the “white” list;
After the launch of the contract, it does not require the slightest support, and all activity is provided by users;
Allows you to work with lists of almost arbitrary size with a minimum consumption of storage block.

Minuses:

It is necessary to spread the public address list somewhere;
The client code needs to see all the addresses in the “white” list and execute a fairly resource-intensive code.
In this algorithm, there are no secrets, such a payoff from the memory of the contract is generously “paid” for the work of the code on the client side to verify the membership of the list. This approach demonstrates very well the difference between the models of using smart contracts in comparison with traditional centralized systems.

The traditional distribution of tokens by the script in response can be countered only by a simple and understandable scheme of work. Moreover, the efforts of the programmer to run ordinary airdrop at times exceed the efforts for laying out the Merkle-airdrop contract, the launched script should be monitored so that it does not fall off in the middle of the list so that it does not run out of funds for commissions for transactions, make sure that no one stole the key with which the script signs transactions. Plus, if you have a file with addresses, you really do not need a programmer-it’s extremely easy to implement such a contract through public services.

Features of the implementation

In addition to the basic smart contract, the full DApp for Merkle-airdrop has some features in the implementation. In the Merkle-airdrop scheme, a significant amount of work is assigned to the code in the user’s browser, for example, building Merkle proof, for which you need to run through the entire address list. The list of addresses should be stored somewhere, and for the user, it should be no more difficult than uploading the file to the server.

Conclusion

The main “advantage” of the traditional distribution of tokens on the list is that this scheme allows you to cast tokens even to those who do not want it. There are also special perversions when you can send out tokens so little that the exchange does not even allow you to make transactions with them, and users are forced to watch these “scraps” on their addresses without being able to get rid of them.
The problem of airdrop, when the company distributes part of the system tokens in the community, is of course extremely important for the development of projects. However, such a decision is unfriendly to users and inefficient in general. So in general, smart contracts tend to gravitate towards the concept of “pull” rather than “push,” in which network users are initiators and controllers of business processes, and stories, when someone centrally imposes something on tens of thousands of users, gradually the past.

2018   Aidrop   Crypto currency   Crypto industry   Digital investmens   ICO

Citizenship for crypto

Nowadays, the crypto investors are becoming increasingly difficult to maintain and increase their fortunes seeing how the cryptocurrency is taking an increasingly prominent place in the world financial system.

The actual citizenship for money (including digital) can be issued only in a limited number of countries. In fact, there is a little more than a dozen. Moreover, the opportunity to obtain citizenship for Bitcoins is still available only in one state – legitimately and quickly – Vanuatu.

Over the past years, it has been possible to observe many changes in the offshore, banking, investment, and tax spheres. These changes began to occur especially often with the acceleration of the transition to the era of the digital economy, and also against the background of active Internetization and globalization. Each next change brings with it specific opportunities and challenges. Also, as practice shows, only those who are ready to adapt to these changes thrive.

This axiom is still relevant, including for the crypto-currency industry. More recently, crypto-currency investors began to face a growing “snowball” of changes. Governments are stepping up the onslaught through tax instruments and are trying to regulate the ever-increasing crypto-currency market. In response to these events, prudent investors began to explore the possibilities of tax and offshore planning available to them to adapt to the changes.

Cryptocurrencies are still an exciting component of wealth planning tools for any successful person. In this case, cryptocurrency investors, no doubt, must protect their assets with advanced tax, offshore and other strategies.

Those who conscientiously seek to adapt to changing realities and norms should take a small part of their cryptocurrency wealth and invest in alternative residences and passports to ensure long-term prosperity for themselves and their loved ones by protecting their crypto savings.

As noted above, you can get the same additional passport for Bitcoins. This procedure is legal and debugged. The first cases are already positive.

Why invest in alternative residence permits / PZHM / citizenships? Here are five main reasons why each serious crypto-currency investor needs an additional residence and/or a new passport – preferably in an offshore and/or low-tax jurisdiction.

The direct approach

In April 2018, the Hungarian company Ajax Software LLC presented the world a new cryptocurrency – Citizenshipcoin. It is designed specifically for the investment immigration industry (CBI / RBI / EB5 programs) and is the first of its kind in the market. According to the developers, the use of the new digital currency will allow investors to instantly settle for participation in passport programs anywhere in the world.

To date, digital currencies are not used in the field of investment immigration due to anonymity. According to the idea of ​​the authors, it is Citizenscoin (CTZ) that can, in the long run, occupy a free niche. The creators assure that using the new cryptocurrency will allow conducting financial transactions without intermediaries in the form of banks.

It is expected that payments will be faster, cheaper and more efficient. Developers predict that in the foreseeable future, consulting companies, citizenship specialists, development, and legal companies, as well as authorities of countries that have the opportunity to obtain a passport for investment, may prefer this cryptocurrency as the primary settlement instrument.

However, given the fact that the level of mistrust of digital currencies is growing, and more fake projects are appearing on the network, it is easy to assume that CTZ authors are facing many difficulties in the way of promoting their coins. Those wishing to issue the second citizenship are required to prove the legality of the funds they use for the investment. If we talk about Bitcoins, then it’s difficult to do. Moreover, the government is involved in the financial operation, which currently relies only on banks that are guarantors of the legality of the process.

The introduction of a new instrument for settlements cannot yet be interpreted as something revolutionary in the industry. It is essential to understand and take into account the specifics of the market. In the Caribbean, the introduction of any innovations drags on for years, Europe is also not ready for such radical innovations.

In October 2017, the readiness to sell passports for Bitcoins was announced in the Republic of Vanuatu. This information edition of The Vanuatu Independent was reported by Jeffrey Bond, the head of the Vanuatu Information Center. Relevant information had appeared in many world media.

A week later, the information was disproved. Samuel Garay, acting Secretary General of the Office of Citizenship of Vanuatu, said that payments are still made exclusively in US dollars.

The current situation was interpreted by many as a profitable marketing move aimed at increasing investor interest in the passport program of the Pacific state. Also, this gave its results: among crypto assets owners, the demand for second passports is growing.

Meanwhile, on April 27, 2018, James Harris, VIC Managing Director, informed the Investment Migration Insider that Vanuatu had established a system for accepting Bitcoins as payment for a Caribbean passport. He said that several applications for issuing second citizenship for Bitcoins had already been successfully processed in his department.

According to James Harris, a particular system timeframe has been developed. The foreign investor and the Vanuatu authorities are contacted in real time. The applicant is informed of the cost of the passport in digital currency and gives two hours for the transfer of funds to the specified wallet. The procedure for conversion into US dollars is made after the successful completion of the transaction.

The Carribean factor

The fact that the idea of ​​using cryptocurrency to pay for a second passport is not new, according to information messages from other countries. In 2014, the authorities of Saint Kitts and Nevis were ready to accept digital money from the participants of the passport program. Soon the website of the Government of the Caribbean country published a refutation of this information.

The prerequisite for the release of relevant information was a series of events. In 2014, Arthur Porter was detained for holding illegal financial transactions in Canada, who at the time of his arrest stated that he was a citizen of St. Kitts and presented a Caribbean passport. Shortly after that, the US Treasury Intelligence Department issued a statement that persons who had registered the economic citizenship of St. Kitts were carrying out illegal financial transactions. Quite often, fake pages with the proposal to issue citizenship of Saint Kitts and Nevis in exchange for Bitcoins appear over time.

At the same time, the authorities of Antigua and Barbuda are working to legalize operations with the cryptocurrency within the jurisdiction. Stedra Benjamin, the country’s attorney general, is working on a bill that would allow the digital currency to be paid for a second passport.

In particular, in May 2018 the possible introduction of a new option to participate in the passport program on Antigua was reported on. Investors will be offered to invest $ 150,000 in the construction of a new university in Antigua. According to the information provided on the Coingeek website, program participants who choose this option will be able to pay for the passport in Bitcoin Cash (BCH).

On the official website of Antigua and Barbuda, there is no confirmation of this information. Representatives of local media expressed concern that the cryptocurrency, which was put into operation only in August 2017, was able to win such support from the authorities and expressed doubts about the possible implementation of this scheme.

The second passport and the change of tax residency – the ability to freely dispose of its crypto-currency asset

The issue of citizenship in exchange for a cryptocurrency is relevant for residents of countries in which strict currency restrictions apply.

Conducting an illegal currency transaction fraught with the imposition of an administrative fine, the amount of which can reach 100% of its amount.

For example, earlier you bought bitcoins for an impressive amount, and now you transfer profits from their sale to an account opened in a foreign bank. In this case, the fine can be imposed not only on the income received but also on the entire crypto-currency asset.

Registration of the second citizenship and change of the tax residence permit to carry out tax planning, personally manage the available assets and significantly save on paying taxes on income derived from the implementation of the cryptocurrency.

Is it now possible to buy citizenship for bitcoins or other cryptocurrencies?
To explain why on Antigua reported on Antigua reported on Bitcoins and other types of digital currency do not use investment immigration in the industry is not difficult. Some leading states have banned transactions using cryptocurrency because digital money can be used in illegal schemes and for money laundering – the thing we have outlined several times in our articles. Stay tuned.

2018   2018   Bitcoin   Blockchain   Crypto currency   Crypto industry

Hottest crypto industry women

Many people have a wrong though about the industry of the crypto start-ups and blockchain tech to assume that it’s a male-dominated field.

Of course, there has always seemed to be an apparent domination of the technology space in general by Asian and Caucasian males. Women hardly ever get a look-in. This assumption covers all organizational levels within the industry, from the boardroom all the way up to the tech developers huddled behind multiple monitors and processing units. A look at some of the major conferences, seminars, and sundry gathering of minds in the blockchain space will reveal a startling scarcity of womenfolk.

However, to say that there are no women who are making tangible contributions within the blockchain space would be a false assertion. There are a number of notable women who are actively involved in leading projects that are dominating the blockchain and cryptocurrency industry. These women aren’t just restricted to any specific sub-niche of the industry as they are scattered across many of the functional segments. Some of the biggest ICOs, digital currency payment platforms, and even blockchain tech development firms have been founded by women. Apart from being part of the evolution and development of the industry, many of them play active roles in improving the adoption of cryptocurrency in mainstream commerce. Here is a brief look at some of the notable women in the blockchain and crypto industry.

1. Galia Benartzi (Bancor)

Education and Early Career

Galia Benartzi graduated from the Johns Hopkins University in 2005. After college, she became heavily involved in software start-ups including Mytopia, Founders Fund, and Particle Code Inc. She was the co-founder and CEO of Particle Code until it was sold to Appcelerator in the year 2011.

Exploits in the Blockchain and Crypto Space

Galia has been something of a tech genius and also a consummate professional in the field of Business and Economics. She is the co-founder of Bancor as well as acting as the Head of Business Development for the crypto firm. The Bancor ICO is one of the highest grossing ICOs of all time. The campaign raised $153 Million in funding and has since gone into advanced development stages.

Bancor is focused on the cryptocurrency exchange market and is building a platform that significantly simplifies the process of cryptocurrency trading. The platform will also allow users to create their own tokens which can then be monetized and traded for other established tokens like BTC, ETH, and LTC just to name a few.

2. Meltem Demirors (DCG)

Education and Early Career

Meltem Demirors is an alum of the William Marsh Rice University where she graduated with a degree in Mathematical Economics. She went further after her first degree to get an MBA from the Massachusetts Institute of Technology (MIT).
Exploits in the Blockchain and Crypto Space
These days, Meltem Demirors is a top Director at the Digital Currency Group (DCG). The company specializes in creating and deploying blockchain tech protocols. The company also manages cryptocurrency investment portfolios. Many of her colleagues at the New York-based DCG describe Meltem in glowing words. On the team page of the company website, she is described as being the connection that forms the bridge between the core operating areas of the DCG.
In addition to her role as Director of Development at DCG, Meltem has also been an active voice against the trend of centralized cryptocurrency mining pools, especially in the Bitcoin network. As a believer in the equitable distribution of wealth within the crypto space, she uses her position at DCG to develop investment strategies that help spread the wealth of the crypto industry.

3. Elizabeth Stark (Lightning Labs)

Education and Early Career
Elizabeth Stark is a graduate of the prestigious Harvard Law School. She is also the founder of the Harvard Free Culture Group and an affiliate member of the Harvard Berkman Center for Internet and Society. She spent a considerable portion of her professional career as a professor at both Stanford and Yale. During her time at Yale, she established a program to help students come up with projects that would improve the existing Internet technology.

Exploits in the Blockchain and Crypto Space

Together with Olaoluwa Osuntokun, Elizabeth is the co-founder of Lightning; a start-up that is developing protocols to significantly increase the speed of crypto transactions. She serves as the CEO of the company. The company’s focus is primarily on the Bitcoin network but contributors are welcome to develop protocol layers for other blockchains.
Apart from her involvement with Lightning, Elizabeth has been quite active in the blockchain space in general. She has contributed significantly to the Bitcoin community as is also a fellow at Coin Center.

4. Rhian Lewis (London Women in Bitcoin)

Education and Early Career

Rhian Lewis studied at the University College London. She graduated with Second Class Honors (Upper Division) in Economics. She is a consummate professional in the Engineering and Technology fields with a working career that spans across many different organizations. She has worked at firms like DigitasLBi, AKQA, and Beamly. She is currently a Director at Salvia Media Services where is a tech consultant for both SDET and Blockchain.
Exploits in the Blockchain and Crypto Space
Rhian has been actively involved in improving women participating in blockchain and cryptocurrency. She started the London chapter of the Women in Bitcoin organization along with a group of friends. The organization has grown to include 100 members, many of whom are CEOs and COOs of tech companies. Rhian continues to be an advocate for women participation in the Blockchain space regularly attending and speaking at conferences, meetings, workshops, and seminars.

5. Elizabeth McCauley (Bitcoin Foundation)

Education and Early Career

Elizabeth Ploshay McCauley graduated from Wheaton College in the year 2011. She holds a degree in Political Science. Her early career was spent in Washington where she served as both Intern and Staff Assistant to United States Congressmen.

Exploits in the Blockchain and Crypto Space

During her time serving members of Congress, she contributed to the adoption of Bitcoin in the United States. Such was her enthusiasm that she has come to be known as the “Bitcoin Evangelist.” She utilized her considerable expertise in grassroots activism to bolster the adoption of Bitcoin within the United States.
She is currently a member of the Board of Directors at the Bitcoin Foundation. She is an adviser at both the BitGive Foundation and Coin Congress. Her previous roles include a stint with BitPay Inc. where she worked as an accounts manager.
This is by no means an exhaustive accounting of all the leading female figures in the blockchain space. There are also individuals like Kathleen Breitman (co-founder of Tezos), Maxine Ryan (co-founder and COO of Bitspark), Tavonia Evans (CEO of $Guap), and Elizabeth Rossiello (co-founder and CEO of BitPesa). These women are setting high standards in many areas of the blockchain space and are contributing immensely to the growth and development of the industry.

2018   2018   Blockchain   Crypto industry   Media figures   Women

Crypto cybercrime level rises

We do know that the cryptocurrencies are being used for different crimes and fraud activities. There is no wonder, and it’s almost the common knowledge. Fact is, the very small percentage of users do realize the reason underlying that.

However, understanding the magnitude of the problem and how it affects us as we use the internet is an important starting point.

Earlier this week, the FBI’s Internet Crime Complaint Center (IC3) released their 2017 Internet Crime Report. More than 300,000 consumers reported that they were victims of malware and cyber-fraud attacks last year (with registered losses of over $1.4 billion combined).

The most common types of crimes were non-payment and non-delivery, phishing scams, and data breaches. The crimes that cost the most regarding financial loss were compromised email accounts, investment scams, and non-payment/non-delivery. In all, the IC3 received over four million complaints between 2000 and 2017.

Profitable business

Fact is, that advanced malware protection specialists from Bromium, together with Dr. Mike McGuire, Senior Lecturer in Criminology at the University of Surrey, released a report entitled “Web of Profit” last month. The report digs into the dynamics of cybercrime and looks at how new ‘criminality’ platforms are bringing about a booming cybercrime economy, generating at least $1.5 trillion in illicit profits. In fact, according to their findings, if cybercrime were a country, it would have the 13th highest GDP in the world, comprising illegal online markets, data trading, identity theft, and ransomware.

The CEO of Bromium, Gregory Webb, says, “The platform criminality model is productizing malware and making cybercrime as easy as shopping online… We can’t solve this problem using old thinking or outmoded technology. New approaches to cybersecurity will be required.”

AI blockchained

There are many blockchains and AI startups springing up to fight cybercrime using these new technologies. Blockchain, especially at the application layer, is certainly moving in the right direction by removing easily crackable passwords. Moreover, if AI can be used to help us predict and prevent cybercrime before it happens, that could be the perfect combination.

Scott Schober, author of Hacked Again and President/CEO of BVS, says, “You’re accomplishing things much quicker when you apply machine learning to cybersecurity. You can anticipate and build up your defenses because we don’t have enough manpower to do it. Using AI and machine learning can do everything much, much quicker.”

However, while we can contemplate the uses of new technologies like blockchain and AI to fight cybercrime when it boils down to it, almost all attacks have a common element: human error.

Schober continues, “I think blockchain applied in the right area is definitely going to help secure things, but you can spend billions of dollars in security, you can implement the latest and greatest blockchain to secure things, but blockchain is fundamentally a layer underneath allowing things to happen; it’s not a magic silver bullet to stop hackers in their tracks.”

The Human Element

There are many people making money by preying on unsuspecting internet users. Also, we all know by now the importance of being careful when we go online. We don’t open links from strangers, we don’t download suspicious attachments, and we don’t respond to messages on Skype asking for our bank details.
Most of us have been victims of cybercrime at some point in our lives. It’s not surprising that criminals pick the easiest targets (people over 60, according to the IC3 report). However, even the highly technically minded among us can be affected too. Just look at the continued Binance phishing scams that have duped more than one exchange user.

However, the Schober notes that , the biggest problem in cybersecurity today is people. “We continually fall back to choosing convenience over security… We were lazy with creating passwords, and guess what? It hasn’t changed much today. We don’t take the time to carefully vet what we’re putting out on the internet and then it’s used against us. People are too trusting; we give out information too easily.”
Until we fundamentally change our habits and improve what Schober calls our “cyber hygiene,” all the blockchains in the world won’t be enough to keep our account funds or our identities intact.

So, one should start from himself when thinking about safety in the digital and crypto environment.

2018   2018   Crime   Crypto industry   Digital investmens   ICO

Bitcoin-related crimes – only 10%

The Bitcoin and related cryptocurrencies are being used for different criminal activities all over the world  – little wonder, it’s common knowledge nowadays. Starting from the basic stuff like money laundering and going on to drug and weapon trafficking and so on.

However, the latest report by the US Drug Enforcement Administration (DEA) announced a significant decrease in the use of Bitcoin in criminal activities. As representatives of the agency noted, only 10% of all transactions are related to crime, while their aggregate volume has grown substantially, Bloomberg reports.

As stated by DEA special agent Lilita Infante, over the past five years the number of legal Bitcoin-transactions has exceeded the illegal ones.
“The volume of [transactions] has grown significantly, and their number has also increased. However, in percentage terms the number [illegal transactions] have decreased,” she said.

Such data, Infante said, had been obtained as a result of an analysis of the blockchain data, which DEA ​​started in 2013 after it drew attention to an increase in the use of the Bitcoin in the cases under investigation.
As of today, she says, only 10% of transactions are related to criminal activity; basically the Bitcoin is more used for speculation.

Lilita Infante is also a member of the US Department of Justice’s Cybercrime Investigation Unit. The group consists of 10 people and focuses on the darknet and investigation of cases involving crypto-currencies.
Statements that criminals choose cryptocurrency as an alternative to cash, using it for money laundering and terrorist financing, have long been heard by critics of Bitcoin. First of all, this applies to representatives of central banks, who also regularly repeat the mantra about the “anonymity” of Bitcoins.

The last statement, as is known, is far from the truth, moreover, as Lilita Infante says, even if less liquid coins like Monero and Zcash give more anonymity, its department can cope with this challenge.

“The blockchain gives us many tools for identifying people. Truth be told, I would like that they continued to use crypto-currencies, ‘she added.

Back in July, US President Donald Trump signed a decree on the creation of a working group, whose tasks will be, among other things, the investigation of crimes committed using the Bitcoin and other digital currencies. The crypto industry is mentioned in the context of fraud, the fight against which is one of the priority tasks facing the US authorities.

Time goes forwards, and governmental positions regarding digital currencies are still strict, but the reality check is always useful when making statements about cryptocurrency involvement in fraud and crime activities.

2018   Bitcoin   Blockchain   Crime   Crypto industry   Fraud

Crypto industry & currency brutal facts

The digital era offers more and more data every coming day, the ways of informational communication become more and more distinguished and sophisticated. Speaking about the security, the more advanced methods are used for protection, the more complex attack tools are used by fraudsters and cybercriminals of the new era to avoid or to break it.

This is not an easy task to stay safe&sound in the modern informational world, let alone the crypto industry itself.

Fact is, the all the data, which is supposed to remain confidential, the personal stuff, they assets and account info – that’s all at stake. The cybercrimes are the more and more often happening, and the forecast is not positive as the industry seems to be only more lucrative over time.

The latest research from RiskIQ does highlight the unpleasant things that are still present though.

Things can really get out of user control

No matter how much efforts one can take into the protection of the customers’ data, the things can always slip away of your control – just like with the MyEtherWallet phishing attack.

With the emergence of the social engineering, the fraudsters become more innovative and creative. Nowadays they can even copy your company – through the website, email, or social media page: all these efforts are to trick the customers and employees into giving away vital information and get the malware installed on their hardware.

It is stated that in just Q1 2018 RiskIQ identified more than 25,000 phishing domains posing as almost 300 brands – moreover, 40 % of them were established in the financial services industry. So, what is the best way to struggle against the phishing? Raise the level of knowledge of your customers, employees, and stay alert – to take the necessary actions to get down the impostor sites down as soon as possible.

The mass attack goes wide

Going on, the RiskIQ states that their company analyzes over two billion HTTP requests every day. Moreover, they deploy web crawling infrastructure that checks terabytes of passive DNS data, millions of SSL certificates, and monitor mobile apps to see how broad the scope of an attack surface really is – or, simply put, how much of an opportunity is there for hackers to break in?

The company analyzed over three million new domains and 77 million hosts that could all be potential targets for a hacker over a two-week period. Since many modern websites share the same frameworks, plugins, and third-party apps, the hacker’s job is even easier. Just as we can create websites faster and easier, so can hackers come up with malicious code to infiltrate them all.

Fact is, one of the most significant vectors is content management systems (CMS) are to attached to WordPress – RiskIQ found that over 13,000 WordPress plugins were among Alexa’s most-visited sites.

Moreover, some 3,390 of them showed critical vulnerabilities running at least one weak web component.

The scale of mobile attack surface is substantial

Most users think of the Google Play Store and Apple’s App Store to be the only mobile app stores available globally. However, there are plenty more of them: a host of affiliate stores serve the Android market, and they can present a wealth of opportunities for bad actors to replace legitimate apps with the fake ones.

Another data from RiskIQ shows an unprecedented 21,948 blacklisted mobile apps, equating roughly to 1.5 percent of all new apps. Almost all of these apps claimed READ_SMS permission, allowing them to intercept messages that could circumvent 2FA.

The best tip could be given – users should always download apps from the primary app stores and be extremely careful when researching the apps they download – if it doesn’t look legit and it’s asking for too much information, it’s probably best to avoid.

Cryptocurrency Miners are set loose

The mining programs and crypto jacking are making the buzz all the time around as more and more computers get infected with the software for mining and lose GPU power as an effect. For example, it is known that more than 50,000 websites have been running Coinhive over the last twelve months – knowingly or otherwise.

Also, there is now an average of 495 new hosts that run cryptocurrency miners every week. Too, even worse than that? Many of the crypto mining scripts found have been active for over 160 days already, meaning companies have failed to detect them.

Hackers may know much more than you expect

Going on, RiskIQ research found that at least 30 percent of companies have more internet assets than they thought. Here counts such stuff as shadow IT, M&As, or a simple lack of organization.

For example, Shadow IT occurs when an IT department outsources for a time and fails to include all internet assets in the company security program. If this happens over a period, it becomes an easy vector for a hacker, since these assets remain unpatched and don’t pass security frameworks.

What is the main reason? Mergers with other companies often lead to this, as the list of assets is frequently incomplete and sometimes chaotic. Internet assets include elements such as domain names, certificates, hosts, and apps.

Still, the modern security strategy for the most companies has shifted to the defense-in-depth approach starting at the perimeter and layering back to the assets that should be protected.

Happy end

In today’s world of digital engagement, users sit outside the perimeter along with an increasing number of exposed corporate digital assets—and the majority of the malicious actors. As such, companies need to adopt security strategies that encompass this change.

The chaotic world of the crypto industry sees many dangers – let alone ICO start-ups which have numerous vulnerabilities as for the investors, and to their creators as well. One should invest as much as possible to security as this present specific danger even nowadays. The existing defensive methods required need to be developed and continuously updated. The things can get out of hand, and harsh pretty fast in case organizations do not take proper attention to assets protection.

2018   Blockchain   Crime   Crypto currency   Crypto industry   Crypto wallet   Hacks   Mining

Art & Blockchain

The humanity has been producing art of different kinds since the times immemorial. From the simple cave paintings to the works of the Renaissance period – through the centuries, artworks had become more and more distinguished and sophisticated, new genres appeared and mixed, a lot of prominent artists had influenced the entire generations.

Though the nowadays present questionable forms of artworks, the classics are still a top.

Moreover, these days of digitalization taking over literally everything and blockchain technologies getting involved in daily lives.

The question is – how the new form of technology advancement can help with the today’s problems or improve our experience on a specific stage?

One of the latest recent trends is the blockchain – from the collectible and valuable digital kittens and meme trading cards fetching prices of over $100,000 to artificial intelligence (AI) driven artwork, the blockchain technology has now become another art world trend.

Co-owning of the pictures of Van Gogh, Picasso and so on can soon become popular – impressive enough, with the help of blockchain one can touch the eternal without having to pay astronomical amounts of money.

For example, each picture is divided into pieces. Depending on the picture or pieces size, their amount can vary from 1,000 to 10,000,000 or more. The participant of the project can buy any number of pieces and become one of the co-owners of the picture. Imagine that one can visit the exhibition, see the picture and feel closer to the great work of art – the paintings like “Sunflowers” by Van Gogh or “The Night Watch” by Rembrandt? Digital solutions make the classic pieces of art even more accessible to achieve now.

Blockchain art consists of more than just slapping a piece of art online, however. There are a few things you should know about this emerging market and how it’s changing the artwork for the better.

The Art: ways of blockchain use

Among the approaches used by the today’s digital artists, there is a different way of engaging the blockchain into the industry. Some artists produce stuff in which the blockchain is a subject while others are simply using the technology in their creations.

The Art: blockchain-used

However, beyond the collectibles, artists are finding other ways to utilize blockchain technology for their artwork. One example of this is the Scarab Experiment, which combines artificial intelligence (AI) with tokenized memberships to create one piece of art from the combined 1000 submissions of community members. Once submitting the art piece, an investor receives a tradeable Scarab token that gives you voting rights for what artwork the project includes.

The Art: blockchain-based

Although not built with the blockchain, numerous works of art use the technology as inspiration. Recently, the first-ever publically commissioned Bitcoin monument was erected in Kranj, Slovenia. Citizens of the city submitted ideas for the memorial via Facebook, and officials chose Bitcoin because of the region’s ties with the industry.

Going from there, blockchain has also influenced Bitcoin graffiti art, renditions of Satoshi Nakamoto, and even the Last (Bitcoin) Supper.

The Collectibles

Not the least is one of the most popular forms of the blockchain art like the collectibles – the CryptoKitties and Rare Pepe trading cards have garnered a cult-like following.

These digital pieces of art are directly created, stored, and traded on blockchain platforms like Ethereum and Counterparty.
However, the rareness of each collectible is what drives its value and price. You can quickly pick up collectible blockchain art for as little as $5, but some pieces have price tags of over $100,000.

The Art: Verify & Track with blockchain

One of the vital points that rate essential enough is not the creation of art – authenticity approvement of rare things. Due to the conducted research, The Fine Art Experts Institute (FAEI) in Geneva stated in 2014 that over 50% of the artwork that they examine are either forged or misattributed to the incorrect artists. With pieces in the fine arts market selling for tens or even hundreds of thousands of dollars, it’s essential that one buys exactly what they want to.

Similar to blockchain’s use in agriculture and supply chain, one can use the power of public immutability to maintain art’s integrity. Meanwhile, some projects are working to tokenize art provenance. Blockchain art provenance is a method of proving the ownership of original creations via blockchain.

How does this work? Simply enough:

An artist creates a new piece and certifies it with a token on a blockchain.When one purchases the artwork from the artist, they transfer the associated tokens.When one sells the piece, the token are transferred to the buyer.

The token transactions are stored publicly, so the buyer can easily track the entire history of ownership back to the artist. If the token doesn’t originate with the artist’s wallet, the artwork is a fake.

This process can be used for physical pieces of art as well as digital works sd they are easily reproducible, associating them with tokens preserves their rarity which, in turn, retains their value.

The Art: Eliminating the intermediaries

The blockchain art market is best at making middlemen obsolete. Decentralized art galleries are popping up left and right giving most (if not all) of sale proceeds to the artists.

For example,Curio Cards are GIFs and images tied to Ethereum in which artists receive 100% of their sales. Because the cards are on the blockchain, you, as an artist, can choose exactly how many you want to sell. There’s no need to worry about copying, forgery, or substantial fees. This opens up a whole new world of monetization for digital artists.

Even with physical works of art, galleries are using blockchain. Maecenas is a decentralized platform that democratizes fine art. If you’d like to get involved with art investing but don’t have the bankroll to purchase a multi-thousand dollar piece, this platform is for you. On Maecenas, you can invest in a portion of the artwork using the platform’s ART tokens. Additionally, to finance new pieces, galleries can list their artwork to Maecenas users at a fraction of the cost of what an auctioneer or loan would cost them.

The Art: The Blockchain market

If you’re a collector, creator, or just a casual observer, art’s blockchain revolution probably affects you in some way. Even in this rising industry, there are still plenty of ways to get involved and stretch your creative muscles.

Conclusion

Nowadays we witness the widespread of the blockchain which results in the improvement of many existing fields of human activity, opening new horizons while broadening the existing ones and going over the borders with the innovative technology.

2018   Art   Blockchain   Crypto industry   Fraud   Market

Crypto cemetary – Dead ICO number rises

The rising market competition, new world regulations and investor overfed with scam projects and ideas had led to the point that most of ICOs tend to fail more and more times. As the market is already overwhelmed with the blockchain-based solutions and countless fraud attempts looking like the new industry solutions. Due to the latest statistics, there are already more than a thousand cryptocurrency projects that actually ceased to exist.

The analytical data provided by the DeadCoins and Coinopsy suggests that among such projects, ones can be found which show directly no hints of any planned developments or future activity in its protocol. The crypto coin cemetery is filling up despite to the market experiencing a specific cooldown since the last year. The  Dead Coins lists around 800 tokens which are out of the game for now, while Coinopsy estimates that more than 1,000 that had met their infamous fate.

Fewer than 4 percent of ICOs with market caps of $50 million to $100 million was successful or promising, according to a March analysis from ICO advisory firm Satis Group. Most ICOs were raising money without having an experienced development team or an actual product, just white papers studded with promises.

At the moment, the blockchain startups are faring worse than their counterparts in other industries. Going back in the past, in 2013 and 2014 precisely 103 companies received initial seed or angel funding in, but only 28% percent managed to raise additional financing, according to CB Insights’s report. For comparison – that number went up to 46 % of the 1,098 tech companies that raised a second round in the U.S. between 2008 and 2010. Among tech companies, 14 % went on to a fourth round, while only 2 percent of the blockchain companies did, the researcher found.

Such projects as BRIG, for example, represent the pure scam aimed to lure out money from its investors’ pockets. It goes way worse after that with the numerous fraudulent project such as one of the brothers Jack & Jay Brigov and Titanium for a fact. By the way, the latest one is an investigation which is being handled by the Securities and Exchange Commission USA (SEC) itself. Other latest scams worth mentioning are the CryptoMeth, Droplex, OreoCoin, and Roulettecoin.

Noteworthy is the amount of money wasted – the average amount of money stolen or lost due to these ICO projects gets close to several billion dollars of investment.
Even even though up to this points, numerous legislative acts had been issued in many countries, financial regulators which continuously check the issuers of tokens for legitimacy, the overall amateurness of investor’s approach often neglect one basic rule. Before investing in any suspicious activity which requires an initial project analysis at least, try not to invest all the money you have hoping to get huge profits sooner or later by reaching millions of dollars in extremely questionable projects.

Another enormous problems of ICOs are their either incompetent or openly fraud teams. The widespread disappearance of project authors took part quite often last year mostly – after getting the astronomic amount of investment into “innovative projects or platforms” on their assets globally, CEOs one after another started to disappear alongside with their bags of money flying off to offshore zones or private islands, having their future secured and backed by bankrupt investors.
Numerous exciting stories and legends about website malfunctions or the sudden “death” of developers count here as well.

Hackers and cybercriminals represented another common threat, which affected even the decent projects and their teams. That includes the direct strike on initial coin offering campaigns while the token sale stages, wallets and exchanges hits and more, which resulted in both investors and project creators suffering from this activity.

However, earlier this month, SEC chief Jay Clayton said that his agency’s fight against fraudulent ICO is just beginning. At the same time, companies that raise funds through sales of digital tokens should not have any illusions and think that the government will treat them differently than to firms participating in the traditional securities market.

The previous results of the Satis Group study indicated the amount of $ 1 billion collected by the fraudulent ICOs in 2017. Out of the thousands, 271 projects had issues with the White Paper plagiarism, either had employees who pretended to be somebody they are not or had another vicious indicator of fraud activities.
Moreover, an additional study conducted after had shown that only 8% of the tokens after ICO were able to get listed on the well-reputable exchange.

No doubt, we are about to see a lot more abandoned ICO that never make it to exchange and overall ICO investments may become unprofitable. Due to CoinSchedule info, ICOs have raised $11.75 billion only during 2018 up to this point.

2018   Blockchain   Crypto industry   Fails   Fraud projects   ICO

Alcohol industry blockchainization

Alcohol consumption is as old as the humanity itself. There is no way that the civilization will some time in the future give up this habit. and the history had shown us that the different prohibitions are definitely not a solution.

The humanity drank, drink and will continue to consume alcohol in the foreseeable future. Nowadays, the alcohol industry is growing at an undeniably high rate.

This industry includes bar merchants, suppliers, wholesalers, and producers. Due to QYKBAR’s data, the industry grew to an estimated $1.25 trillion in 2016. Considering its current pace, the production is expected to hit the $2 Trillion mark by the year 2025.

The blockchain technology popularity and worldwide adoption grows and has already been implemented in various fields – financial sector mostly, as well as healthcare, logistics, artificial intelligence, new technologies and developments and much more.

Various issues with providers throughout the supply chain exist as well, and it is currently difficult to establish accountability with so many stakeholders involved.

Nowadays, the blockchain tech approach represents a solution for this crisis in the form of smart-contracts that would serve to stabilize this volatile marketplace. Applying blockchain technology and the use of a public ledger that cannot be tampered with, each link in the supply chain would be held accountable. Improved efficiency and greater transparency can be achieved as the result.

Transactions that are currently subject to currency conversions and delays would take place in the specific cryptocurrency, further streamlining the process.

It seems the time has come to use the technology in the production field – particularly the alcohol industry.

Current attempts to bring the market and production together is aimed for solving numerous existing problems of the market and production:

1) The counterfeit problem. According to various studies, 30 to 60% of alcohol nowadays is fake.

2) The issue of product promotion by manufacturers and the decline in the effectiveness of traditional advertising formats.

Fact is, the 1989 year Directive, which is in full force in all countries of the European Union, restricts the way in which information on alcohol is provided. Some states have imposed a total ban on the promotion of alcoholic beverages in Europe, including France, Norway, Russia, and Ukraine.

3) The problem of vast alcohol range choice for consumers. Also, the consumer does not have the opportunity to quickly get acquainted with the variety and prices in different stores.

Considering these problems, specific steps need to be taken to develop the industry and move it on the next circle of production, efficiency, and security.

The unique encoded NFC-tags used for each bottle and specific blockchain tech may help, as the alcohol manufacturers will be able to protect their products from counterfeits and, as a result, increase their product sales and profits of their company.

The mobile application development will be required to be able to verify the authenticity of the products, obtain information from the moment of production until the goods hit the store, aswell as to track availability and prices in the nearest stores.

Blockchain tech can also help the alcohol manufacturers to directly advertise their products at the time of product selection by the end user, showing any information encoded in an NFC-tag (cocktail recipes, ingredients, production method). Moreover, they will be able to create loyalty programs for their customers, use big data to collect information and get targeted at 1,022 metrics, which will increase sales and increase customer loyalty to its brand.

Providing the platform for consumers of alcoholic products reviews, where they could post & read reviews of other users. The artificial intelligence platform will show recommended drinks based on the user’s preferences and experience. Moreover, the consumers can also participate in vendor loyalty programs and receive a reward either in tokens or fiat currencies for writing reviews of alcohol products, depending on the user’s rating and the number of likes of other users.

The industry market size & future

It is estimated, that the current average consumption rate of alcohol per inhabitant of the planet is 6.6 liters of pure alcohol per year, an average of about 60 bottles a year. World consumption number stands on about 450 billion bottles of alcohol per year. The cost of each NFC-tag is 0.06 dollars. The volume of the NFC-label market for alcoholic beverages could be $ 27 billion per year.

Moreover, the recent research indicates that 55% of the inhabitants of the world used alcohol at least once in their lives. The number of potential users of the system is 4.125 billion people. 5 billion people have mobile phones, 80% of them use smartphones that can read the NFC-tag.

There is a global trend both for the use of NFC-tags (the market grows annually) and for protection against counterfeiting, states are obliged to label their products at the legislative level (Bar-codes, QR codes, NFC tags, etc.). IBM company also announced the development of a chip to protect against counterfeit products in the field of drugs, cosmetics and so on.

The identifier itself (NFC-tag) cannot be faked, as it will be produced at the factory and the information will be encrypted in the blockchain. One label can be used in the blockchain only once.

Current existing and future market solutions

There are already blockchain platforms operating in this field. For example, the “Wabi” in China, which focuses on establishing protection from counterfeit products, but it is aimed at the Chinese market exclusively rather than the whole world. IBM is developing a chip and plans a system of protection against counterfeit products in the field of drugs and children’s products. OinSpase conducts a project to protect against the control of the production of QR codes. VeChain (Singapore) solves the problem of counterfeits of luxury goods and product safety for different companies.

The future steps in the vineyard

The world, however, doesn’t escape lightly as verifying authenticity had become as essential as never before – but on a massive scale.

For example, the sales of Pinot Grigio exceeded the amount grown in the 90’s. So what made up the shortfall? Moreover, there had been recent scandals involving Brunello company. Sadly enough, there are plenty of other incidents occured. Fraudsters substitute cheaper inferior wines, cut them with water or use food additives – including even adding such added dangerous chemicals as Diethylene Glycol and Methanol which actually did kill people.

Nowadyas, one of the latest examples regarding alleged fraud involves the large French wine bottler, Raphaël Michel: Carrefour has canceled their supply contracts. The allegation is that part of this scam included passing off as much as 300,000 hectolitres (over 3m cases) of wine classified as cheap Vin de France as far more expensive Côtes du Rhône and Châteauneuf du Pape.

To avoid this, growers could attach an independent DNA fingerprint, Isotopic data, smart sensor data or chemical analysis to the initial Blockchain transaction executed through the specific smart-contract. However, the verification of wine quality, safety and origins are possible from grape to glass.

Moreover, blockchain is being implemented into many projects related to this field – the bars based on the blockchain, the crypto solutions for alcohol logistics, distribution and so on. Well, the future of alchool industry looks bright and sparkle with the blockchain.

2018   Blockchain   Crime   Crypto industry   Fraud   Future

Most known ICO Advisor mistakes

ICO model of fundraising still rates high as the new startup appear on the market and there seem to be no end of ideas fueling the numerous blockchain based-start ups. However, the cryptocurrency market is far from its former heights, and the overall cap state is not astronomically high.

Certain prominent industry hype-trainers like John McAfee claims that the BTC price will touch $500,000 by 2020 and even the ICOBENCH report is optimistic with the prediction of the overall market recovery in early Autumn 2018.

ICO advisor is a person responsible fro project development vector, the one that can help in overall idea development and director, concept creation and expert in a specific industry field. All these qualities make him essential as a team member.

Being a famous industry person or a highly-valued professional increase a chance that a team will use advisor as one of their trumps card and investor’s hook.
Problem is, a lot of start-ups creator did overuse that practice, having attract prominent names just to be listed in the project and without having a direct impact on the development process.

One of other problems is the lack of understanding. The hired professional can be the best marketers, analysts or economists, but when it comes to understanding decentralization, and based on these singular utterances their understanding could be quite limited.

Moreover, right now there is another quite popular rumor on the market – as  nobody is interested in ICO investing anymore and there are days of this idea left to be profitable.

No wonder that over the years of million profits going to the scam projects, the regulation around ICOs has finally tightened and many countries had already made their points clear and issues the policies on so-called ‘utility tokens.’

Nowadays, the tax-havens are tricky topics as continually changing regulations make companies change their location quite often. What seemed to be easy to handle a year or a month ago today represents a stricts laws so what will the next day bring is always a question.

Things is, despite all the fraud, exchange hacks, and increasing legislative bodies regulation attempts, the amount of money in this industry gets higher and higher every year.

Due to the latest statistics, the market dynamic is definitely positive. The volume of funds attracted worldwide through the ICO for the first quarter of 2018 was $ 3.3 billion. For comparison, in 2017 with the help of ICOs, $ 6.1 billion was raised. The well-known rating agency ICORating provided the data.

As for geography – most of the ICOs were conducted under the United States jurisdiction – 59 projects totaled about $ 583.8 million; in Singapore – 34 projects raised about $ 468.1 million, and in the UK 26 projects raised $ 99.7 million. In Russia, 13 projects raised about $ 20.8 million.

During this year, the overall number of non-accredited investors investing is expected to reach the same number as the number of non-accredited investors in equities and other capital market products.

We sold the decentralization protocols to them as the silver bullet that would usher us into the era of equitable wealth distribution. This turned out to be a lie.

Another deal-breaker for the small investor is the terrifyingly frequent pumping & dumping of the market’s unworthy altcoins. Due to many advisor and consultants, specific points should be outlined of what documents should be issued before meeting investors, private or otherwise. If neglecting them, there is a slight chance that not even the best ICO Advisor could help to raise funds.

1) Decent project tokenomics.  While working on this part, specific rules should be followed as well as specific criteria to derive the token price, utility, and the total number of tokens mined.

2) Tokenization plan —  in case of utility token route, one must find out the best fit for tokenization. Most ICOs these days tokenize the access to the platform badly.

3) Working MVP — Most conservative investors whom I reached out to, “I wanna see how much skin do you have in the game.” What I learned from that conversation was that if the ICO had not invested at least 30% of the planned ICO money from their own pocket, investors are not going to like it.

4) A scalable business model —which is strong money attracting plan. However, it is not about appreciation of token utility and burning of unsold tokens. Explain why will people come to your platform and how will you monetize their interest.

5) Investor pitch deck  — An investor pitch deck must definitely have an elucidation of the business model, existing user base, and team credentials. Additionally, it must have an explanation of your product’s features and scalability potential.

6)  Elevator pitch is the thing that most often. It is useful for pitching an idea to the potential investors that you might meet at meetings and seminars etc. It is better to have an elevator pitch and save yourself from explaining the white paper to someone at a dinner party.

7) Team with decent credentials — a great idea and smart contracts are not always enough to present the successful product. Most people look for those team members who have legitimate experience in that particular space. Having a cryptocurrency advisor whose only claim to fame is that they became ‘Experts’ on ICObench does not cut ice with investors anymore. In case with ARK ICO. They have a team that has been in the business of managing seafood logistics of over 50 years combined.

8) Social media traction — if the product is so revolutionary, it must reflect on social media. While a part of your social media outreach can be seeded inorganically, you must refrain from letting it go beyond 20%. There are tools to find out the engagement on social channels such as Telegram, and it will reflect poorly if these reports come out adverse.

9) Practical market strategy —  as investors and buyers have an uncanny ability to fish out the rotten eggs and reject them.

As of Q3 2018, the ICO could not be regarded as a scheme to get easy and fast benefits from as we need to provide much more than the usual white paper to attract funds. One may also have to fork out equity to the private investor if you are really strapped for funds.

For now, there are no magic recipes to win in ICO market ultimately. One has slight chances of failing even with the decent team. If your marketing, product development, and the team credentials are great, you will raise funds.

However, there is no point in going pessimistic with your perspective ICO idea – the history had shown that even in times of hardships and calamity, man has invested, for profit or for fun.

2018   Blockchain   Crypto industry   Digital investmens   ICO   Start-ups

How to return ICO investments?

Being an ICO investor is a tricky thing – no matter how good at digital economics or how smart you are, lack can eventually run out. Nowadays, according to various estimates, fraudulent ICOs activity had brought their creators from up to $ 1 billion incomes of dirty money.

For now, there are different examples when the fraudster ICO organizers got eventually busted and brought to justice. The US SEC is among the best performing in this area up to date.

It is known that in 2017 the founders of the Munchen project were forced to return $ 15 million to investors after the SEC investigation. Moreover, In early April 2018, the organizers of ICO “Centra” were arrested – that one which managed to raise $ 32 million. The SEC especially, in particular, indicates that the founders of the project promised to invest in creating a debit card, which will be supported by Visa and MasterCard payment systems and will allow you to convert cryptocurrency into fiat money easily.

However, the investigation showed that the project had no relationship with cooperation either with Visa or MasterCard firms. Another fine example is from Canadian origin, where the court sentenced the organizer of Plex Coin ICO Dominique Lacroix to two months in prison and a fine of $ 10,000, and the company PlexCorps he founded – to a fine of $ 100,000. The SEC had done a good job here, no wonder.

The latest statistics show, that SEC is very active in the ICO field, but outside the US authorities are not yet successfully combating fraudulent crypto projects. Fact is, the needed ultimate legislation rules are still not established worldwide which makes the prevention of fraud a tough task to accomplish.

Nevertheless, there is still a set of legal instruments, and the necessary steps exist aimed to protect your rights and investments and not to become a victim or consider that the company does not fulfill its obligations for some reason. In fact, for most investors, it does not matter why they lost money in the first place – deception or because of the useless work of the organizers of the ICO. It is essential for them to return the money or at least part of it.

What to do before going to court or police?

In case you think that you have been deceived and want to start an actual case:
First, you need to collect the maximum amount of evidence available to you that you have been cheated or that you owe money. Making screenshots proving the fact of deception or fraud is necessary.

That could be the following stuff:

White Paper with the description of the project, advertising banners, correspondence in Telegram and other messengers will do. Also, it is essential to save and download all communication by e-mail.

If you had any telephone conversations with the fraudsters – you could ask the telephone company to print out the history of your calls, that wo;; serve as perfect proof. If you have personally met with company representatives, you need to specify the address where the meeting was held, the date of the meeting, and try to attract witnesses.

In case your meeting took place in overcrowded business centers, you should have a record of your visit at the security checkpoints. Documents from camcorders can also be saved there, which can later be requested by official representatives and the police. As a result, you should have an impressive folder with information, from which you can already apply to the court or the police. It remains a matter of small – to understand who specifically to write a statement.

Understanding the demanding side

Most ICOs have the same structure at modern market. An issuing company, as a rule, is explicitly created for the ICO, which issues tokens and accepts investors’ money. Very often, such companies are registered in the Cayman Islands, Seychelles or Bermuda, or in ICO-friendly jurisdictions such as Singapore and Estonia. Many ICOs, especially fraudulent, do not specify the information about the company-issuer not in White Paper, or anywhere else. Usually, one can find it in Token Sale Agreement.

However, the issuing company does not conduct operational activities. Moreover, information about the operating company is even more challenging to find – its traces could be seen only by indirect signs. That could be tricky as if the organizers initially wanted to deceive the investors. Most likely, one will first have to demand money from the issuing company.

Visiting the court

The court appeal against the company-issuer for inflicted financial damages could be regarged as the protection in situations where the actions of the responsible person do not contain the corpus delicti. The judicial procedure is relevant for cases when it is not a matter of fraud, but merely an unsuccessful project in which the organizer has not fulfilled his obligations and is in no hurry to return the money. However, in the case of fraud, recourse to a court with a claim against the issuing company can also become an effective way of protection.

One need to present a claim to the issuing company about the return of funds or compensation for damage before going to court with an appropriate application and the evidence collected. With a favorable outcome in court, one will be given a monetary claim to the issuer.

There is a decent worldwide trend – the fewer and fewer jurisdictions are available overtime in which beneficiaries manage to hide from taxes and creditors. Banks exchange information about the funds more actively and there are fewer loopholes. No wonder that over time, opportunities to pursue the issuing company and the real organizers of the ICO will only expand.

However, one can demand to return the money through court only where the company is registered. In case it is registered in the most popular off-shores like Cayman Islands, then one will have to visit the local court. The cost of doing business in the Caymans is up to $50,000 , in Singapore $ 75-125,000 – without regard to state duties, translation services, and other related costs. That is, either one’s investment in the scam-project should significantly exceed the possible costs of conducting the case in a foreign court, or one will need to file a class action together with other cheated investors.

When and how to contact the police

If there is an obvious deception (for example, the organizers received money, did not conduct an ICO and stopped communication), it would be appropriate to contact the police. The criminal case provides additional opportunities, which is a significant plus. For example, an investigator can obtain all the necessary information much faster than if one requested it through a court.

However, there are also several disadvantages: since there is very small legal practice, it will be difficult for the police to understand the matter of this category. The task is to bring the maximum amount of evidence of the violation of the law, and the statement is as simple as possible to describe the crime.

On the other hand, there is a parallel practice when, for example, clients money are stolen from a current bank account. In such cases, the crime scene is considered to be the bank’s registration address, although it is clear that the theft itself occurred somewhere on the Internet. So in the fraudulent ICO crime scene, there may be an address where the computer was located when you invested money in ICO.

Anoter vital question that investigators may have is a problem with determining what Bitcoin is, cryptocurrency, tokens and so on. The legislation does not yet have a precise definition. For the police, the qualifications of such crimes may not be apparent, although there are signs of fraud (theft of property or the right to fraud). Here, by the way, one can recall the cases in which cases of robbery of game artifacts in computer games were considered.

The conduct of both a criminal and civil-law case, especially international – along (and also expensive) process. Therefore, no matter how trite it may sound, it is best to study all documents carefully and all available information, weigh risks at the investment stage. Also, just in case everything is fixed – it will come in handy.

However, it is better to describe the case in the application as simple as possible, without overloading with technical terms. If everything went well for you: the application was accepted, you were interviewed, and the case started according to your application, – the question arises that such crimes, as a rule, are of a transboundary nature. Investigators will have to send a request to conditional Singapore or the Cayman Islands so that local authorities can conduct the necessary investigative actions. The state has much more leverage to handle such cases than an ordinary citizen who is unlikely to wait for help from a foreign court.

2018   Crypto currency   Crypto industry   Fails   ICO   Investment

Rule of 56% – ICO fail number rises

While the cryptocurrency market is quite live, it is still far from its autumn 2017’s heights. Nevertheless, the ICO start-ups market shows the constant growing tendency – due to official statistics of ICORating, the amount of ICO projects in 2018 had significantly grown. The overall market dynamic is definitely positive. The volume of funds attracted worldwide through the ICO for the first quarter of 2018 was $ 3.3 billion. For comparison, in 2017 with the help of ICO funding model, $ 6.1 billion was raised.

For now, not only scam projects and fraud are the worst enemies of the investor though. While more than 4,000 ICO projects have managed to raise a combined total of around $12 billion during all the time – a majority of them fail within four months of their token sales, a new study suggests.

The latest research, conducted by a small team at Boston College in Massachusetts, found that a mere 44.2 percent of token projects are active into the fifth month or beyond, using their social footprint via Twitter as a live indicator.

About 56% of ICO start-ups ceased to exist during the first four months after the successful end of the token sale. According to many analysts, the most secure investment strategy for various tokens is the sale on the first day of trading. Either way, almost all investors get rid of coins purchased under the ICO in the first six months.

More than 1,000 different tokens have already ceased to exist, and overall return on investment is steadily declining.

It should be noted that the monthly investment in ICO projects still holds over $ 1 billion. This trend has been maintained since the beginning of 2018.

While the figures are perhaps shocking, they should maybe be taken with a pinch of salt, as the methodology of the study leaves some wiggle-room for ICOs to exist beyond that 120-day time-frame and not be indicated so in the data.
The tokens usually continue to grow in price, generating average buy-and-hold abnormal returns of 48% in the first 30 trading days.

Dead on arrival

Going for an experiment in determining the usual lifespan of an ICO project, the team behind the research, Hugo Benedetti and Leonard Kostovetsky, chose to use the availability and intensity of Twitter posts to analyze the lifespan of projects and found out that tweet absence during the fifth month meant the absolute project fail or, so to say, it’s death.

The analytics data of the research indicates that the safest way of performing for the projects would be managing to list on exchanges after the token has been launched:
“Breaking it down by category, 83% of the 694 ICOs that don’t report capital and don’t list on an exchange are inactive after 120 days. For the 420 ICOs that raise some capital but don’t list, this figure falls to 52%, and for the 440 ICOs that list on an exchange, only 16% are inactive in the fifth month.”

Moreover, their work beside went on with determining the value of ICOs as investments and the average returns over the different time-frames, after going on for the overall moves in the value of the cryptocurrency markets.
Fact is, the researchers Benedetti and Kostovetsky found that “in contrast to IPOs, tokens continue to generate abnormal positive average returns after the ICO,” with token values continuing to climb for six months after launching.

“We find evidence of significant ICO underpricing, with average returns of 179% from the ICO price to the first day’s opening market price, over a holding period that averages just 16 days. Even after imputing returns of -100% to ICOs that don’t list their tokens within 60 days and adjusting for the returns of the asset class, the representative ICO investor earns 82%.”

Conclusion

Further, the researchers say that startups sell their tokens during the ICO at a significant discount to the opening market price, generating an average return for  investors of 179%, accrued over an average holding period of 16 days from the ICO end date to the listing date.

During his interview, Kostovetsky told Bloomberg that “once you go beyond three months, at most six months, they don’t outperform other cryptocurrencies.”The strongest return is actually in the first month,” he added.

Anyway, the overall conclusion shows that, despite the shocking figures of failed projects, high rewards could be achieved for those that accept the risk of investing in “unproven pre-revenue platforms through unregulated offerings.”

However, the market future looks promising as a lot of promising startups in different areas continue to flourish every passing week.

2018   Blockchain   Crypto currency   Crypto industry   Fails   ICO

First world’s ICCO – from Malta with love

The emerging world of blockchain industry had seen different kinds of investment and crowdfunding approaches. The nowadays most popular instrument which is ICO had surely been around for some time and literally rocketed to the moon during the last year, but it’s certainly not the only and top tool to collect money from the investors around the globe.

Malta is known, amongst many other reasons, to be the country which recently applied specific official regulatory measures to make the fundraising for blockchain-based projects fully legislatively regulated within its territory. That implies the first milestone in the industry – the ICCO which stands for Initial Convertible Coin Offering.

The first in the history ICCO was announced by the blockchain company Palladium, and the leading bitcoin-exchange Bittrex – as the first fully regulated environment in Malta.

As stated in the Bittrex press release, the difference between convertible coins is that within three years after the release holders of these coins can at any time change them for shares of Palladium company.

Moreover, Malta is enacting comprehensive blockchain legislation and has a dedicated blockchain unit at the MFSA. This ICCO is one of the unique investment opportunities in the blockchain world. The University of Malta will also offer a special Blockchain degree which will start in October this year.

An ICCO model differs from the now-more-traditional Initial Coin Offering in that investors will be able to convert tokens into company shares at a later date – in Palladium’s case, three years after the sale.

“We expect this project, which will create more than 100 job opportunities, to be a historic landmark and to bridge the gap between traditional financial services and cryptocurrencies,” – founder and chairman Paolo Catalfamo commented. Moreover, he also spoke very positively about Malta, as a country located at the front of blockchain technologies.

The launch of the project was attended by the Prime Minister of Malta Joseph Muscat, Secretary of the Parliament for Digital Innovation and Finance Silvio Schembri, and the head of the Maltese Financial Services Department Joseph Kushiri.

“This ICCO will become one of the largest investment opportunities in the world of the blockchain. Institutional investors understand all the advantages of investing in the cryptocurrency industry, but the lack of regulation discourages them. The decision of Palladium will change this and allow users to use their accounts to manage cryptocurrency and fiat assets in full compliance with regulatory requirements, ‘says Paolo Catalano.

The goal of this particular ICCO is to collect financing of $ 150 million. The official campaign is scheduled for the period from July 25 to September 30, and the prescription of tokens began on Tuesday, July 10.

‘Our cooperation will lead to a new trading platform based on blockbuster technology, and users of this site will have access to many tokens available at Bittrex,’ said Bill Shihara, CEO of Bittrex.

Malta had adopted the new legislative acts governing the cryptocurrency industry only last week. Silvio Schembri noted back then that Malta had become one of the first countries with such official regulation.

No doubt, during the next months we are about to witness if this recent approach would be appreciated by any other countries which try to apply the ICO regulation rules or other legislative measures within their territory.

2018   2018   Blockchain   Crypto currency   Crypto industry   ICCO   Malta   Regulations

Hottest Blockchain News Weekly # 2

Tomorrow is a brand new day. That goes double for the crypto world as the dynamic industry of the blockchain-bases projects and cryptocurrencies are always full of exciting news, events, and occasions. We provide you with the most recent and inspiring stories of the outgoing week.

1)Youngest Crypto Billionaire goes for McDonald’s

The 34 year-old co-founder of the Bitmex exchange and Oxford graduate Ben Delo is recognized as the youngest British billionaire who has succeeded on his own, reports The Daily Mail.

According to Ben Delo himself, sincle 2014 he worked on his startup hard for 18 hours a day. He also said that at the initial stage the company had little money, so he rented accommodation on the online site Airbnb. At present, BitMEX is one of the largest cryptographic platforms in the world with a daily trading volume of about $ 2 billion.
As the newspaper writes, now the youngest crypto-billionaire of Great Britain lives with his wife in Hong Kong. Ben Delo said that he promotes a modest lifestyle and prefers to donate his money to charitable organizations.

Bitcoin-billionaire and his wife, according to the publication, use vouchers to buy food in McDonald’s and have only three pairs of shoes.
Note that there are at least 35 bitcoins-billionaires around the world, although, according to the publication of BitInfoCharts, this number can reach 200 people.

2) Crypto money laundering is still at large

It is reported that over the first six months of 2018 with the help of crypto-currency, $ 761 million.

During the first six months of 2018, fraudsters cleared $ 761 million in cash generated through illegal activities. The American company published such data on cybersecurity CipherTrace, writes American Banker.
As CEO of CipherTrace Dave Jevans said, the world trend of money laundering using crypto-currency sharply increased this year. According to his forecasts, by the end of 2018, the amount of funds “hidden” in this way will grow to $ 1.5 billion.
For comparison, for the entire year of 2017 criminals, to conceal their illegal incomes laundered $ 266 million – three times less than in the first half of 2018.
In the fight against this unfavorable trend, the company created an anti-wash platform CipherTrace AML, which is based on artificial intelligence. To identify potential sources of money laundering, the system uses advanced analysis methods and public cloud services.

The technology developed by CipherTrace offers a visual interface showing traces of financial flows and attributive information about the current currency location, including the country and the exchanges used. According to Dzhevans, these flows can also help determine the possible origin of the transaction from the darknet.
In June, the tax authorities of the United States, Australia, Canada, the Netherlands and the United Kingdom joined forces to fight tax crimes and money laundering using cryptocurrency.

Recall, in April, Europol detained 11 people who developed a scheme for money laundering through crypto-currencies.

3) ICO Hypetrain goes hot – more than $14 Billion gathered

According to the report of the joint study by PwC and the Crypto Valley association, in the first five months of 2018 with the initial placement of coins (ICO), 537 start-ups managed to raise $ 13.7 billion. This included projects such as Telegram and EOS, which collected 1.7 and 4.1 billion dollars, respectively.
Last year, 552 ICO-projects collected a total of 7 billion dollars. Even if you do not take into account Telegram and EOS, this year ICO has already raised about $ 8 billion.
According to Daniel Diemers, head of PwC Strategy, “after the ICO boom in 2017, now more attention is paid to improving business and legal practices, investor relations and attracting financing.”
The report notes that the success of ICO projects in 2018 is primarily due to the involvement of hybrid companies that allow start-ups to raise funds after receiving venture financing publicly. Such ICOs prefer to collect from 100 000 to 1 million dollars from venture investors and only then to open the presale to the general public.

This year in the UK there was almost as much ICO as in the US, and given the number of planned companies, the UK is in the lead. Regarding the number of funds raised (about half a billion dollars), Swiss projects have almost equaled that of Great Britain, and Lithuanian and Estonian projects have collected the same amount in aggregate.

Against the background of the Telegram and EOS companies, the Cayman Islands and the Virgin Islands rose in the rating, followed immediately by Singapore, which far exceeds other Asian countries.

Despite the active competition among European projects, as well as the favorable attitude of the French Ministry of Finance to the cryptocurrency area, France did not fall under this rating.

The latest in the ranking in Hong Kong, which is likely to be influenced by Chinese bans, despite being technically a separate jurisdiction.

Of the top 20 most substantial ICO funds as of November 2017, 65% have either submitted their product or are close to it, 20% have severe problems in the process of selling the product, 10% have no product, 5% have abandoned their plans.

Key findings:

Starting in 2013, 3,470 ICOs were conducted. Even though many stopped or ceased to exist, 30% were still able to complete the procedure successfully;
The leading place for the ICO is the USA. In the first five months of 2018, 56 projects were able to raise $ 1.1 billion;

Switzerland is the recognized capital of the ICO, but in 2018 Britain broke out in the first place regarding volume and quantity.

ICO is gaining momentum and is becoming a real alternative to financing, as technology start-ups around the world continue to raise funds through the ICO bypassing banks and other intermediaries. However, ICOs are increasingly beginning to register with the US Securities and Exchange Commission.

4) Bleeping Computer: new virus software can monitor 2.3 million BTC addresses

The CryptoCurrency Clipboard Hijackers virus can monitor 2.3 million cryptocurrency addresses and change them to other wallets, Bleeping Computer reports.
Malware is detected as part of the All-Radio 4.27 Portable package. Last week, hackers forged the program and gave out an infected version for the original.
With the activation of the package, the malware begins to run unnoticed for users in the background. So, after installation in the Temp folder on Windows, a DLL file named “d3dx11_31.dll” is downloaded. When the user reboots the computer, an autorun program is created that opens this DLL file. The DLL file is executed using the command “rundll32 C: \ Users \ [user-name] \ AppData \ Local \ Temp \ d3dx11_31.dll, includes_func_runnded”.

The virus then looks for BTC addresses in the Windows clipboard. If you copy the address without checking the transfer, then the cryptocurrency will fall on the purse of scammers.

As the newspaper writes, the best way to protect yourself against such viruses is to double-check the copied cryptocurrency addresses and use anti-virus programs.
Note CryptoCurrency Clipboard Hijackers is a unique virus due to the number of addresses that are monitored. Earlier, Bleeping Computer detected malicious programs that tracked more than 600,000 addresses.
During the first quarter of 2018, McAfee Labs discovered over 2.9 million malicious programs for the hidden cryptocurrency mining.

5) Canada blockchained: 5% of Ontario inhabitants hold cryptocurrency assets.

About half a million (5%) of the inhabitants of the Canadian province of Ontario are owners of bitcoin or other crypto-active assets. These are the results of a study conducted in the most densely populated area of Canada by the Department of Investments of the Securities Commission of the region, writes CCN.

Most often, interest in the industry of crypto-currencies is shown by men aged 18 to 34 years. About half of them spent less than $ 1 thousand to buy cryptocurrency, 90% spent less than $ 10 thousand. 9% of investors (almost 50 thousand people) invested more than $ 10 thousand in crypto-active assets.

“The survey results show that the vast majority of Ontarians look at crypto-active with caution. Only a small percentage owns them, and most often they do not spend significant amounts of money to purchase them, ‘the document says.
A significant portion of the investment was made from existing savings. Some also borrowed money or used credit cards, of which more than two thirds fully repaid loans.

The survey also revealed that about 1.5% (about 170 thousand) of Ontario residents took part in the initial deployment of tokens (ICO). Information about them investors received via e-mail, from online advertising, from friends and relatives, and through social networks.

About 46% of respondents indicated that they acquired their assets on trading platforms, while 28% minted them. About 19% used for crypto-cash ATMs and 18% received them for free, for example, via airdrop. Another 18% received crypto-currencies as payment for goods or services, and 16% – during the ICO.
To acquire crypto-agents, Ontario residents used to use trading platforms in the USA (48% of respondents), about 32% used trading platforms based in Canada. Platforms based in the UK and Hong Kong are also popular.

The poll also showed that the inhabitants of the province have an idea of ​​the crypto-currencies, but they can not explain the principles of the technology operation. Most residents of Ontario know about bitcoin – 81% say they knew about it. About Bitcoin, Сash heard only a quarter (25%) of the respondents. The number of those who knew about Litecoin was 13%, and only 11% of the respondents know about the second most popular cryptocurrency of Ethereum.

Recall, previously the state-owned energy company Hydro Quebec presented to the authorities of the Canadian province of Quebec a plan that will determine the procedure for working with local ministers cryptocurrency.

2018   2018   Blockchain   Crypto blogs   Crypto industry   News

How to catch the Bitcoin whale – fraud schemes explained.

In the crypto world, Bitcoin-whales are considered to be the people who have thousands of precious coins on their wallets. As it turns out, there are not so much of them.

Quite recently, Chainalysis “scanned” the entire network of the first cryptocurrency and found that only 1600 accounts contain more than 1000 BTC. Probably, several of them belong to Satoshi Nakamoto, which everyone knows about, but nobody has a clue about his personality.

Nevertheless, many people who bought Bitcoin many years ago for tech experiments or just for fun had become very rich last year due to cryptomarkets rising – a lot of multimillionaires and even billionaires had appeared suddenly. Even some of them managed to get to the Forbes list, this kind of people mostly tend to stay in the shadows.

Not all of them are active participants of the community or businessmen. Of course, some of them just withdrew some money for classical entrepreneurship, luxury goods, travel and other things that can be bought for cash.

However, when you trade 30, 50 or even 100 BTC, you are not concerned with security and legality from the law are your problems, and when you need to exchange 1000-5000 BTC, it becomes the problem of governmental and regulatory authorities.

No wonder that real criminals – drug lords or terrorists have their own established channels of financing and money laundering, and lawyers have their own methods of destroying such channels.

Let’s imagine that you’re the good guy here and you need to deduce a tremendous amount of money of a 4000 BTC for example. Even considering the bearish lawlessness in the market, it is more than $ 25 million at the current exchange rate. Do you start thinking if it is possible to arrange everything in offshore zones? And of course – how and where to find such a buyer?

In 2015, sophisticated fraudsters took care that the answer to the main question had become the following. We call it a conditional harpoon cannon because of this time attackers aimed at single whales, not organizations like exchanges or e-wallets.
At first, scammers throw their networks into the necessary information flows, which are used by community members. The story they tell always has same contours and diverges only in non-essential details.

A particular person “with great experience in concluding international crypto-currency transactions” has a “large buyer” who is ready to buy 10 000 – 20 000 BTC at a price of -5 % shall we say of the Bitfinex price. And the task of an “experienced intermediary” is to find a seller or sellers. Then they will be invited to meet in such cities as Vienna or Zurich to make the necessary transfers of tete-a-tete. Besides, to scale this scheme, intermediaries attract other intermediaries, promising the recent commission, which gives the system a pyramidal character.

The most known and rich cities often are used for such crime schemes.

One might think that the most bitcoins-whales are intelligent people and will feel wrong, but scammers are incredibly persuasive, focusing on details and nuances, demonstrating imaginary professionalism. And what can happen to a man in a wonderful Switzerland, a country of bank secrecy, luxury, and security? It is the names of cities that create the so-called luxury effect so that the story of a large buyer seemed believable.

The overall scheme is quite simple: the sophisticated fraudsters could arrange a change of suitcases with cash or any other virtuoso trick to convince the seller that he received money without actually receiving anything – not even weapon threatening is required.

There are also thoughtful raids of European law enforcement agencies, which take the issue of money laundering and violation of tax legislation very seriously. Even in Switzerland, where bank secrecy is akin to the biblical commandment, the transfer of a suitcase or sports bags with a massive pile of cash will cause suspicion.

All members of the community should remember that the Bitcoin-industry has attracted the attention of not only hackers, talented crackers of digital systems, but also good old thieves from the area of classical crime. They can come up with dozens of methods for identifying and robbing whales, but the latter should always be a step ahead, and certainly not to be fooled by such infamous schemes.

2018   2018   Bitcoin   Blockchain   Crime   Crypto currency   Crypto industry   Fraud

Hottest Blockchain Week News #1

1) Facebook is open for crypto advertising again

The world’s largest social network and media giant Facebook announced the revision of the total ban on advertising crypto-currencies. So, previously approved advertisers will be able to post content about crypto-currencies and related topics, except ICO. The news had been announced on Tuesday, June 26.
To obtain permission to publish advertising products and services in the field of cryptocurrency, advertisers must provide Facebook with data on licenses, listing on stock exchanges and any important public information about their business.
Facebook will make decisions based on the data received from advertisers; however, as already warned in the organization, not everyone will be tested.
The company promised to listen to the community’s opinion, learn technology and review the rules if necessary.
A recall is regarded, earlier Facebook banned advertising ICO ads and cryptocurrency, including the Bitcoin.

2) Bithumb Exchange hacked

After just over a week after breaking into the South Korean trading platform Coinrail, the crypto-exchange community shocked the news of the hacker attack on Bithumb. As a result of the hacking of this much larger stock exchange, crypto-investors lost a total of 35 billion South Korean won (about $ 31 million).
However, the management of the exchange Bithumb managed to move part of the digital assets to a cold wallet and promised to reimburse investors funds soon. Payments will be made from the fund’s own stock exchange, which holds about $ 450 million.
Against the backdrop of this wretched event, the government of South Korea announced a tightening of the regulation of the crypto-currency industry and acceleration of the implementation of the new regulatory framework.
“If the bill of the deputy from the Democratic Party of Korea, Zhe Yong-gyun, is adopted, the authorities will be able to introduce rules for crypto-exchange exchanges that are identical to those for commercial banks,” the representative of the Financial Intelligence Unit of the country (KFIU) said.
It is expected that with the participation of KFIU and the Financial Services Commission (FSC), security and the infrastructure of the crypto-currency market will be strengthened. In this case, exchanges will be obliged to work in compliance with the safety standards that apply to financial institutions.

3) John Mcafee is back to life

Unknown attackers poisoned the famous crypto enthusiast, media person and founder of MGT Capital Investments John McAfee. He was unconscious for two days but woke up on June 22, which he immediately told his subscribers on Twitter.

“I apologize for my three-day absence, but I was unconscious for two days at the Vidant Medical Center in North Carolina and just woke up. My enemies managed to spike something that I ingested. However, I am more difficult to kill than anyone can imagine. I am back.” – McCafee said.

Besides, the crypto-enthusiast has left a rather ominous message for the attackers themselves.

“And for those who did this – You will soon understand the true meaning of wrath. I know exactly who you are. You had better be gone. – He replied.
Attackers poisoned the famous crypto enthusiast and founder of MGT Capital Investments John McAfee. He was unconscious for two days but woke up on June 22, which he told his subscribers on Twitter.”

Earlier, Roger Thomas Clark, known under the pseudonym Variety Jones or simply VJ, was extradited from Thailand to the US, where he would stand trial for alleged complicity in the illegal activities of the DarkNet marketplace Silk Road.

It is believed that it was VJ that prompted Ross Ulbricht to order the murder of Curtis Green, the Silk Road administrator of the Silk Road, caught by the FBI.

2018   2018   Blockchain   Crypto industry   Digital investmens   Future

The Dangers of Darknet

Numerous articles had been written on how the blockchain will change the world to better and why cryptocurrency assets are the future of the financial industry.

However, while admiring the current and future benefits of usage, the digital money also has the other side with its malicious nature. The fraudsters, hackers and different criminals use the topcoints and altcoins for different activities forbidden by the law. So, the common public knowledge is often influenced by the unfavorable market situations and overall despair against cryptocurrency are getting worse.

Quite often media highlights the dark side of the crypto world and make the public opinion regarding cryptocurrencies look like facilitating criminal activity. Actually no wonder that being the top coins at the moment Bitcoin, Ethereum, Monero, and a few other assets are the weapon of choice for the digital fraudsters and cybercriminals during these years of crypto market fever. Of course, the governmental bodies and special commissions are up for changing that as they present more and more strict regulation measures and laws, but the current situation will not change in the nearest future.

Going on with the explanation, there are a quite a few reasons why cryptocurrencies are so attractive to the fraudsters these days. No real names are being used, and the wallet address is convenient for hiding your real identity, which makes the personality disclosure a hard challenge.

Next thing is the volume of transactions. The global worldwide networks take a lot a massive load due to everyday growing number of transactions, and that makes the finding of the fraud schemes a tough challenge.

Even considering the popularity of cryptocurrencies, the so-called Darknet existence is still bad news for the many crypto enthusiasts of this industry as not many newcomers are aware about the crypto realm shadow side. But the highlights are often come to this area, as the cryptomarket rise thieves the activity.
The main points that drive the fraudsters methods popularity are the anonymity and privacy.

Due to the latest researches, over the 95% of illicit activity on the different darknet nowadays had been produced using the Bitcoin. This is of course due to the most popular asset popularity, liquidity and value.

However, the Silk Road has shown the world how the darknet and cryptocurrency can come together in meaningful ways. Perhaps people can remain convinced this was a positive development in general, and the public opinion looks very different these days.

The Darknet itself is a place, mainly speaking, where one can get any items strictly prohibited by the law and get away with it after.

The main points of user interest include such things as illegal drugs acquisition, black market guns trade, fake documents and IDs of any kinds, all sorts of explosives, secret files disclosure, porn content of all types, going on with the nasty stuff like that from there.

No wonder that the Bitcoin is the most liquid instrument for this kind of activities, and it will likely remain for some time.

Speaking about official statistics, it is known that 2016 had almost 14,000 cases related to the drug and other illegal substances. Therefore, over 1,400 people engaged in this type of activity until police officials around the world actively began arresting vendors and buyers globally. It is estimated in 2016 more than $1.3 billion of the worth of profits for drug sellers embracing cryptocurrencies was the actual number. Considering the crypto market popularity rises, no wonder that the official date of 2017 could present much more embarrassing and shocking data.

One thing is sure that the shutting down of such darknet marketplaces cannot change the situation significantly as the new platforms will arise pretty much soon. Same as with Hydra – you cut one head, the more appears. Much more drastic measure is to be taken by the world governments to change the situation and make the widespread more closed and the acquisition of dangerous prohibited items – even more complicated.

2018   Blockchain   Crypto industry   Daknet   Fraud   Future

Gambling goes blockchained

During the last couple of years, the popularity of digital currency casinos has increased considerably, given the wide variety of benefits being offered to players worldwide. Many people believe that the Bitcoin and some top coins are the perfect currency for online casinos, and recent statistics show that the market agrees with this mass opinion.

The blockchain industry victorious march is even out of the question for – the next years will undoubtedly see this prominent technology getting adopted in more and more industries. Banking area, transportation, jurisdiction, logistics, different productions, healthcare, gaming – there is potentially no shortage of sectors of current human activity where the blockchain cannot be applied for improving the existing solutions. Verifications of the highest possible level, unmatched security&safety options, smart contracts that can ensure payment transactions on the new standard.
Online gambling represents one of the first industries that went on experimenting with the use of blockchain technology, as different bitcoin casinos represent one of the most widespread use cases of cryptocurrency in its early years.

However, despite the evolution of cryptocurrencies in recent years, the overall impact on online gaming had been relatively small so far.

Anyway, despite the cryptocurrency market rapid shifts the last couple of years, the digital currency casino market has evolved and grew, given the appearance of more game types, features, bonuses, and more.

Nowadays not many even professional online game players and supporters do realize the potential benefits of cryptocurrency casinos when compared to more “traditional,” fiat-currency based online casinos.

1)The blockchain technology allows providing the games results, stats, and ratings that cannot be counterfeited. Different solutions out there in the market even before the blockchain adoption, though so far nothing is likely to provide better security and privacy in the coming years.

2) Client’s anonymity of the top level and best access options. Years before many had legitimate doubts and concerns with the personal information being shared on third-party gambling resources. And of course, this isn’t a case with crypto casinos. However, many gambling solutions are so easy-to-use that they automatically register user accounts when accessing the websites, and therefore, do not require personal information such as email, name, or real postal players address. Of course, it is a positive approach as an anonymity level like this also allows users located in countries where online gambling is under a legal ban, still access the resources and play their favorite games.

3) Unfortunately, some emerging crypto casinos currently suffer from the governmental tightening regulations as they are required to obtain licenses and apply more and more stricter rules over time.

4)The astronomically high speed of transaction execution. Before the blockchain stepped in, both the deposits and withdrawals in online gambling had never been that fast. Most popular existing casinos require transactions to have one confirmation on the blockchain network, before allowing users to wager the funds. However, the overall process can require no more than a few seconds or a couple of minutes, based on the client’s digital currency of choice. In contrast, the withdrawals are usually processed almost instantly. Users no longer have to wait for days before being able to play or withdraw their funds.

5)Lowest fees – the modern digital currency casinos had proven to have some of the most affordable dues on the existing market. Most cases show no cost associated with either deposits or withdrawals, and many new startups aim for low maximum indications to be attractive in this market and cope with numerous competitors.

The market for mobile applications and online games shows tremendous growth and an ever-increasing influx of new users over the past few years. According to 2017’s “AppAnnie 2017 Retrospective: A Monumental year for the application economy”, the overall market capitalization of mobile applications has reached $ 86 billion.

Due to the latest Newzoo insight, in 2018, the mobile games market will generate $70.3 billion – 51% of the overall global games market. However, the data from Statista reports that social casino revenue worldwide is estimated to reach $5.89 billion by 2022.

Moreover, according to Newzoo – the quarterly update of its Global Games Market Report service – the current forecast shows that 2.3 billion gamers across the globe will spend $137.9 billion on games in 2018. This represents an increase of +13.3% from the year before which was $16.2 billion.

Digital game revenues will make up 91% of the global market with a value of $125.3 billion. Mobile gaming will continue to be the largest segment following 10 years of double-digit growth since the first iPhone was launched in 2007. In total, mobile revenues will grow +25.5% year on year to reach $70.3 billion. This means that for the first time, more than half of all game revenues will come from the mobile segment.

No doubt that in fact best options for immersive player experience nowadays are provided by the most reputable companies.

2018   Blockchain   Crypto industry   Digital investmens   Future   Gambling

Old World ICO Regulations

Initial Coin Offering regulations in the European countries differ from the ones of Northern American and Asian regions – the so-called “Old World” always has its own approach to any problem. In this article, we examine the ICO regulations in top European world countries.

Nowadays, one of the problems that many governments have with ICOs is that, technically, they represent a regulatory workaround. The problem is, that instead of seeking initial public offering businesses mostly can find low amount seed funding without the due diligence regulatory requirements, time, or fiduciary permissions as the  “traditional” IPO model would require. For a small business dealing with untested or unknown technologies, this peer-based alternative offers funding opportunities to firms otherwise ineligible for conventional funding approaches.
Of course, this approach can definitely help the ambitious enthusiasts to embody their perspective ideas. However, the last year’s reality shows that the number of fraudsters in this area of activity had risen to an unexpected level of 90% or close. Such countries as China and South Korea both claim that the possibility of scammers using ICOs to defraud investors is the primary reason they have moved to ban the creation or selling of them in their countries.

Many nations are pursuing changes to their regulatory policies to codify adherence to anti-money laundering/know your customer (AML/KYC) practices into law for ICOs and require additional oversight, such as registrations and disclosure statements.
Additionally, if the ICO relates the property transfers to fiat currencies, these ICOs, in fact, may be dealing with securities. This has implications for taxation and securities integrity.

The European Union

For now, within the European Union, overall, there has been a focus bringing ICOs in line with current legislation. The main idea of the process was in contending with them is to allow ICOs to operate within this territory, as long as they adhere to Anti-Money Laundering/Know Your Customer (AML/KYC) policies. However, like many of the nations in this category, The European Securities and Market Authority declared that they represent a substantial risk for investors.

United Kingdom

Up to latest time, the UK allows for the operation of ICOs but expects them to regulate themselves to the existing financial laws and regulations. On top of that, there have also been some issued warnings.
The Financial Conduct Authority warned that ICOs are unregulated and potentially fraudulent, while investors may be provided with “unbalanced, incomplete or misleading” documents by the ICO issuer, the Financial Times reported.

Isle of Man (UK)

The Isle of Man has indicated that it is seeking to forge regulations in the future that will establish and protect ICOs’ legal status.

Germany

One of Europe most developed countries, Germany is another one that has not yet set out direct regulation of ICOs, but they expect any new Coin Offering to adhere to the existing legislation, including the Banking Act, Investment Act, Securities Trading Act, Payment Services Supervision Act, and Prospectus Acts. They have also gone as far as to issue a warning however that there are risks in ICOs.

Moreover, there had been an official statement issued which stated: “Due to the lack of legal requirements and transparency rules, consumers are left on their own when it comes to verifying the identity, reputability, and credit standing of the token provider and understanding and assessing the investment on offer. It can also not be guaranteed that personal data will be protected in accordance with German standards”.

Estonia

For now, Estonia is currently considering starting its own ICO to raise funds. However, the Eurozone rule on nation states not having their own currencies continues to split opinions about the possibility of this happening.

Russia

The Kremlin issued five orders in October 2017, requiring altcoin miner registration and taxation, the application of securities laws to ICOs, and the use of altcoins to create a  “single payment space” in the Eurasian Economic Union to oppose the Eurozone. Russian President Vladimir Putin in May 2018 states, that “Russia will not issue its own government cryptocurrency.”

Switzerland

In one of Europe’s wealthiest countries, the recent attempts to regulate ICOs have failed, but the need to codify protections may reignite the regulation efforts. The Swiss Financial Market Supervisory Authority (FANMA) has started to examine ICOs for possible breaches of securities laws, which may be the first signs of a new wave of campaigning for regulatory oversight. Regulations are not thought, however, to be able to stop the current momentum to incorporate ICOs into Swiss culture.

2018   2018   Blockchain   Crowdfunding   Crypto industry   ICO Regulations

The most underrated cryptocurrencies of 2017

The last year had brought the world crypto community attention to some relatively small digital currencies, which until the specific time had been regarded as failed even by many experts. We outline the most successful cryptocurrency projects that had achieved an unexpected acceptance by the community in 2017.

1) Monero’s main feature is that it’s entirely a unique kind of cryptocurrency — an utterly private coin. No one will be able to track the amount of your savings on this blockchain, unlike popular Bitcoin or Litecoin. The Monero network is constructed with the usage of the CryptoNote Protocol, which is the evolution of the principles which are behind the original Bitcoin. In contrast to the transparent blockchain of the Bitcoin which allows any member of the network to determine the sender as well as the recipient, Monero transactions cannot be tracked, making all the participants anonymous. A temporary drawback is the fact that a small by now number of users hamper the procedure of mixing transaction, and as a result, significant transactions can be visible and tracked down.

Initially launched in 2014, Monero uses a famous principle of proof-of-work. For a long time, it had been considered being an another-bitcoin-double as the media often used the expression “the perfect solution for the fraud and drug trafficking” because of its high level of privacy. However, in 2017 the value of this currency rose more than 3000%. Now Monero is the perfect choice not only for dubious personalities — the developers are actively working on the promotion campaign with five online stores and almost 50 well-known musicians, including Mariah Carey, Sia, Weezer, G-Eazy and many others, who will accept this currency as payments for their services during the holiday season. An exciting and competent move for the legalization and promotion of their cryptocurrencies, no doubt.
The main characteristics of Monero that explains its popularity as t
he currency are the following: maximum security, anonymity and transaction privacy.

2) Ripple cryptocurrency platform is focused on transactions to currency with no chargebacks. A Ripple company’s currency main feature is the usage of “consensus in the registry.” The system had been originally launched in 2012; the Protocol supports tokens representing fiduciary money, cryptocurrency, commodity or other objects, such as frequent flyer miles or minutes of mobile communication. At its core, Ripple is based on an open shared database that uses a negotiation process that allows you to make the exchange in a distributed process. The main feature of Ripple is the low and adequate value that will enable it permanently to be in the top 5 currencies by market capitalization.

The Ripple skeptics always had a negative attitude to it due to the apparent platform centralization as they believed that the blockchain must be decentralized. Thomas Ripple is going to dispel this myth, making efforts for a broader implementation of his creation — after all, with the mass success of this technology, there will be no more long days of waiting when the bank completes your transfer.

Nowadays Ripple indeed drew the attention of major players in the financial world like Western Union. In early 2017 Ripple had signed an agreement with the National Bank of Abu Dhabi, which operates in 17 countries. Today the list of organizations working with Ripple is мукн extensive. It is worth to note the expansion system — recently an additional service had been launched that allows you to complete even precious metals transactions. That had undoubtedly made Ripple a pioneer in this direction and significantly increased the confidence of investors — now even some trust funds make the Ripple deposits.

During the 2017 total rate of the Ripple has grown by more than 4000%, and the experts say that in the future this trend will continue.

3) The main advantage of Stellar Lumens cryptocurrency is its cheapness. Many experts claim that the purchase of XLM tokens is quite profitable because the buyer will not have to worry about the possible substantial loss if XLM is eventually removed from the list — which is very unlikely in the nearest future. Another argument in favor of this cryptocurrency is the trading volume, and the experts also draw attention to the XLM liquidity. Stellar Lumens — one of the undisputed leaders in the alternative coin market capitalization. Another attractive feature is that the XLM tokens can be used as a link between currencies that have no direct private market. They are always among the top altcoins by market capitalization, which means that major “players” are also waiting for the big payouts.

4) The New Economy Movement (NEM or XEM) cryptocurrency has very ambitious goals.

XEM is a peer-to-peer cryptocurrency platform. It’s written with Java and JavaScript and uses the 100% original code. XEM is a model for widespread dissemination and adds some new features to blockchain technology with the importance algorithm confirmation of POI (Proof-of-Importance). NEM also offers an integrated peer-to-peer system for the exchange of encrypted messages, accounts with multi-signs and the reputation system Eigentrust++.

NEM (XEM) project does have ambitious goals. With the blockchain technology, one can create billions of services on it, from online shopping to decentralized social networks, structures with decentralization and the protection of the highest level.
XEM rewards those who support the internal project economy, so users can earn tokens by merely completing the transactions. This model of growth has much more sense than the conventional mining. No doubt, it also may be a revolutionary way to control the future. The developers have plans to create the first cryptocurrency trading platform like eBay, but with the technology power of the blockchain.

2018   2017   Blockchain   Crypto currency   Crypto industry   Digital investmens
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