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Recent Hacks on Crypto Exchanges Fuel Increased Government Intervention

Recent Hacks on Crypto Exchanges Fuel Increased Government Intervention

by David Drake Japan has cracked down on two crypto exchanges and issued a warning to five others, after Coincheck lost over $500 million to hackers in late January. During the heist,hackers accessed hot wallets and made a series of transfers before they were eventually stopped. Japan was the first country to institute regulatory measures to govern cryptocurrencies in October of 2017 and has now threatened punitive measures in an attempt to bolster consumer security. Should exchanges fail to comply with the requirement to improve security by the March 22, 2018 deadline, the regulator could force them to suspend business. Japanese crypto exchanges, BitStation and FSHO were ordered to halt business for the next 30 days, starting March 8, 2018. This is because the authorities discovered that a business executive from BitStation used consumer funds for personal benefits while FSHO failed, in general, to offer consumer protection. Coincheck, already ordered ... Read More »

Why Crypto Exchanges Crypto Business Needs Stringent Regulations

Why Crypto Exchanges Crypto Business Needs Stringent Regulations

  by David Drake Regulation is one of the factors that has been linked to the unprecedented plunge of Bitcoin prices since December of last year. However, Bitcoin, the biggest cryptocurrency by price and market cap, is expected to gradually bounce back. Growth in the cryptocurrency industry has largely been spontaneous, generating mixed reactions on its sustainability. By the end of this year, the crypto market cap is predicted to reach $1 trillion. According to experts, this will only be achieved if a proper regulatory framework is put in place. It is in this spirit that the Japanese regulator, Financial Service Agency (FSA), along with the  U.S. Securities and Exchange Commission (SEC) are cracking down on unregulated crypto exchanges. Current Situation The ongoing crackdowns and warnings by financial watchdogs in the U.S. and Japan are good for the industry. In the coming months, other countries are likely to follow suit because ... Read More »

Regulators Crackdown on Crypto Exchanges in the U.S and Japan, What Can we Expect Next?

Regulators Crackdown on Crypto Exchanges in the U.S and Japan, What Can we Expect Next

by David Drake Financial Services Agency (FSA) in Japan has suspended trading in two exchanges and issued orders to five other trading platforms to improve their system security. This move has come after a probe was launched into a $530 million heist on Coincheck’s crypto platform. In the U.S, the Securities and Exchange Commission (SEC) has issued warnings to cryptocurrency exchanges claiming that they could do anything with investors’ money. As a result of these incidences, the regulation debate rages on as governments look into ways to regulate the cryptocurrency market. The recent crackdowns have created uncertainty in the market with players eager to see what other measures financial regulators across the globe will take. Heavy vs Light Regulation Industry players hold different views on whether government regulation is good for the cryptocurrency industry. According to Ben Way, CEO of Digits, the regulation debate has to be well balanced and properly reasoned. He ... Read More »

Why there is Need to Boost Security in Cryptocurrency Exchanges

Why there is Need to Boost Security in Cryptocurrency Exchanges

by David Drake Last week, Japan’s Financial Services Agency (FSA) halted two cryptocurrency exchanges in the aftermath of a $530 million heist on Coincheck. FSA suspended operations of Bitstation for using client funds for personal transactions and FSHO, and for giving inadequate protection to its customers. In addition, Japan’s regulator sent out business improvement orders to five exchanges, including CoinCheck, requiring them to strengthen their internal management and improve operations. Japan became the first country to regulate crypto exchanges at the country level in 2017. Sixteen (16) crypto exchanges are registered in Japan, and 16 more have applied for registration, which include CoinCheck. The United States, on the other hand, recently issued subpoenas to 80 crypto firms for possible violations of the SEC’s investment laws. SEC also suspended several firms for possible violations of its rules. As of this writing, the country has no crypto regulations yet, and maybe this development is ... Read More »

Will More Corporates Adopt Blockchain Technology From Now On?

Will More Corporates Adopt Blockchain Technology From Now On

by David Drake Looking at the 2018 Bitcoin and Blockchain industry report released by Coindesk, one cannot help but notice that the crypto market has had a tremendous growth.  This does not in any way mean the market has not experienced its fair share of challenges, far from it. At the turn of the year, speculations over ‘Bitcoin Bubble’ saw some governments ban trading in cryptocurrencies and regulatory boards launch crackdowns in the industry. Though a lot still needs to be done about regulation of cryptos, there are signs governments in the U.K., U.S. and European Union are making efforts to understand  crypto operations with the aim of mainstreaming and nurturing the technology behind it. On the brighter side, there have been news that governments, such as Russia and Cambodia are currently working on issuing national cryptocurrencies. Adoption of blockchain technology has been gaining traction steadily in corporates  with businesses ... Read More »

Government Regulations is the next move after Self-initiated Regulations by Cryptocurrency Companies

Government Regulations is the next move after Self-initiated Regulations by Cryptocurrency Companies

By David Drake Unhampered by regulations, the cryptocurrency industry has grown globally as seen in its  market cap of more than $480 billion, and the latest monthly market volume of $723 billion as of February 21st of this year. However, recent developments in the space like the latest cryptocurrency hacks in Japan, Italy, and South Korea, the stolen ICOs early investor funds, and the China ban on foreign cryptocurrency platforms have raised anew the issue of government regulations in this space. Is the bonding together of seven large crypto companies to form CryptoUK, the first UK trade body for the industry, a move towards this direction? “In the short term, I see governments giving the industry some leeway to police themselves while keeping a close eye on how the sector manages due diligence and protection of consumer funds. Crypto is on the radar of many governments, and they will always be watching how we manage our businesses. With ... Read More »

Cryptocurrency Interest by Amazon Show that Mainstream Application is Possible

Cryptocurrency Interest by Amazon Show that Mainstream Application is Possible

by David Drake In recent months, several companies have shown interest in digital currencies and blockchain technology. This is a reflection of the huge strides the cryptocurrency industry has made since its inception, and how corporates are beginning to appreciate their value. Just a fortnight ago, Amazon and Starbucks joined the growing list of companies that are exploring ways to tap into blockchain technology, including digital currencies. However, this did not come as a surprise. On the contrary, many players in the industry expected it to happen. According to Roman Guelfi-Gibbs, CEO and Lead Systems Designer of Pinnacle Brilliance Systems Inc, Amazon, through a survey, played with the idea of using digital currencies in their systems and maybe venture into other businesses. He says, “Many companies have floated the idea of creating their own coins or tokens to be used as currency on their respective sites. Some have followed through and ... Read More »

Tax Footprints: The Motivation Behind Governments’ Willingness to Embrace Cryptocurrencies

Tax Footprints The Motivation Behind Governments’ Willingness to Embrace Cryptocurrencies

by David Drake European countries are calling for crypto regulations. In Germany, Joachim Wuermeling, member of the board of Germany’s Bundesbank, told Reuters that regulation of cryptocurrencies must be global because countries cannot contain transactions made by a virtual, borderless community at national levels. France finance minister, Bruno Le Maire, echoed sentiments made by the country’s President President when he asked the central bank to prepare a regulatory framework for the new cryptocurrency asset class. The regulation should be able to catch tax evaders, detect terrorist funding, and possible financial manipulation. A working group was created specifically for this purpose with the former deputy governor of the country’s central bank, the Bank of France, Jean-Pierre Landau, heading it. Last year, news reports highlighted that Belgium was strengthening its regulation of cryptocurrencies. Currently, cryptocurrencies are neither legal nor illegal in the country. European Union (EU) countries are looking forward to a common policy on cryptocurrencies. The Treasury Committee in ... Read More »

Will Starbucks and Amazon Catalyze Blockchain Integration among Major League Companies?

Will Starbucks and Amazon Catalyze Blockchain Integration among Major League Companies

by David Drake Looking at the 2018 Bitcoin and Blockchain industry report released by Coindesk, one cannot help but notice that the crypto market has had a tremendous growth.  This does not in any way mean the market has not experienced its fair share of challenges, far from it. At the turn of the year, speculations over ‘Bitcoin Bubble’ saw some governments ban trading in cryptocurrencies and regulatory boards launch crackdowns in the industry. Though a lot still needs to be done about regulation of cryptos, there are signs governments in the U.K., U.S. and European Union are making efforts to understand  crypto operations with the aim of mainstreaming and nurturing the technology behind it. On the brighter side, there have been news that governments, such as Russia and Cambodia are currently working on issuing national cryptocurrencies. Adoption of blockchain technology has been gaining traction steadily in corporates  with businesses ... Read More »

Why US, Germany and France want G20 Countries to Discuss Crypto Regulations

Why US, Germany and France want G20 Countries to Discuss Crypto Regulations

by David Drake Steven Mnuchin, US Treasury Secretary, plans to raise the cryptocurrency regulation issue during the G20 summit next month in Argentina. While he doesn’t think cryptocurrencies could threaten financial market stability, Mnuchin says he’s concerned by the potential use of these currencies to launder money and other crimes. Mnuchin’s remarks come in the backdrop of CoinCheck’s hacking attack that saw the Japan-based cryptocurrency exchange lose upwards of $500 million in NEM cryptocurrency. The Treasury Secretary plans to pursue cryptocurrency regulation talks during the G20 gatherings, as well as other global meetings. Akshay Mehra, Founder of Crowd Genie says, “I believe having regulations will actually accelerate the adoption of Bitcoins and Cryptocurrencies by the mainstream financial institutions, which in turn will be a positive for the pricing. Once there is a regulatory umbrella on Bitcoins, the demand should increase to add it as an asset in multiple portfolios.” But the US ... Read More »

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