Blockchain and Cryptocurrency News Roundup
- Post by: bag2q
- October 5, 2020
- Comments off
5 October 2020.
Dive into a short summary of some of the biggest headlines in Crypto this week. Bitcoin volatility hits 23-month low as the cryptocurrency shrugs off BitMEX & Trump’s illness, KuCoin has found the hackers who stole $281 million in crypto, US House of Representatives passes Blockchain innovation act on to the Senate & more than $400 million in Bitcoin withdrawn from BitMEX following CFTC charges.
Bitcoin volatility hits 23-month low as the cryptocurrency shrugs off BitMEX, Trump’s illness
Bitcoin’s 180-day volatility dropped to its lowest mark since November 2018, reaching a 23-month low of 0.028 on Sunday, as the market was mostly unfazed by a week of unsettling news. Bitcoin (BTC) started to stumble through Thursday and Friday after the U.S. Commodities and Futures Trading Commission and Department of Justice leveled charges against BitMEX’s founders and President Donald Trump tested positive for COVID-19. But both news items resulted in a less-than-five-percent drop for the leading cryptocurrency, continuing a period of uncharacteristic calm in a frequently volatile and fickle market. According to data from Coin Metrics, bitcoin volatility has dropped 43% in the past 30 days. Many traders have stayed bearish through the weekend as indicated by perpetual futures funding rates on leading derivative exchanges OKEx, BitMEX, and Huobi. Funding rates on all three exchanges turned decidedly negative Friday as traders took on an increasing amount of short positions, according to data from Skew, with negative rates continuing through the weekend. As the market digests a lot of news all at once over a quiet weekend, some buyers moved to start reversing earlier declines, pushing BTC above $10,640 early Sunday morning, up 2.5% from last week’s low of $10,375.Coindesk
KuCoin has found the hackers who stole $281 million in crypto
Crypto exchange KuCoin has worked out who hacked its cryptocurrency exchange for $281 million. CEO Johnny Lyu tweeted today that, “After a thorough investigation, we have found the suspects of the 9.26 #KuCoin Security Incident with substantial proof at hand. Law enforcement officials and police are officially involved to take action.” The hack took place on September 26. KuCoin said that the hackers used a leaked private key to access the exchange’s wallets. KuCoin says that it has enough money in the bank to cover all of its losses. After the hack, crypto projects worked to freeze or render useless most of the assets. Many teams updated their blockchain to make this happen. Lyu said that $204 million worth of cryptocurrency, or 72% of the total hack, is “out of the control of the suspicious addresses.” The hackers sold at least $13 million of the crypto on decentralized exchanges. In a livestream on September 30, Lyu said, “As a crypto team just turned 3 years old, although we never slack off on security-related issues, we couldn’t dodge the cruelest coming-of-age ceremony that every predecessor used to embrace.” KuCoin, which paused deposits and withdrawals after the hack, is opening up. Currently, KuCoin supports deposits and withdrawals for 31 tokens, though Bitcoin, Ethereum and the US dollar-pegged stablecoin, Tether (USDT), are not among them.Decrypt
US House of Representatives passes Blockchain innovation act on to the Senate
Two bills introduced by Representative Darren Soto—the Digital Taxonomy Act and the Blockchain Innovation Act—are now making their way to the Senate after being approved in the House of Representatives. The two acts have been updated into the Consumer Safety Technology Act (H.R. 8128), which is a bill directing the Consumer Product Safety Commission to explore applications for AI earlier this month. The Bill is now headed for the Senate for the final vote. Essentially if the bills are passed, they aim to protect the public from scams and illegitimate projects—leveraging blockchain technology to combat fraud. Specifically, the Digital Taxonomy Act (H.R.2154) provides clarity on the definitions of two terms—’digital asset’ and ‘digital unit’—and places a burden on the Federal Trade Commission to prevent unfair trade practices of both aspects. In addition, the Blockchain Innovation Act (H.R. 8153) also requires the Federal Trade Commission (FTC) to research and present information on how blockchain can be leveraged in consumer protection.
The two bills were introduced by Rep. Darren Soto (D-FL) and have been rolled into the Consumer Safety Technology Act which was introduced by Rep. Jerry McNerny (D-CA)—which as mentioned pertains to using AI in consumer safety inspections. The act highlights that remaining competitive with digital tokens and blockchain is critical to maintain American innovation, and obligated the FTC to provide further recommendations to limit the abuse of the technology while allowing the United States to remain competitive. Congressman Darren Soto said in a release: “As lawmakers, it’s our duty to ensure the United States continues to lead in blockchain technology […] The Digital Taxonomy Act adds greater jurisdictional clarity for a strong digital asset market in the United States.”Rep. Darren Soto has attempted to introduce or co-sponsor multiple blockchain bills pertaining to digital assets, but so far all bills have had a very hard time making their way through the house. On the success of passing the two bills, Soto said: “The study mandated by the Blockchain Innovation Act is a starting point meant to give government agencies a chance to make recommendations before any bills pass with a regulatory effect[…] These recommendations will perform an educational function to Members of Congress and will pave the way for more actionable blockchain-focused legislation.”Blockchain.news
More than $400 million in Bitcoin withdrawn from BitMEX following CFTC charges
According to Glassnode data, more than 40,000 Bitcoins worth about $400 million have been withdrawn from Bitmex in less than 24 hours after the US Commodity Futures Trading Commission (CFTC) filed a legal enforcement action against the cryptocurrency derivatives exchange’s owners. The amount of Bitcoin withdrawn from Bitmex is 19% of the crypto exchange’s total funds. The huge withdrawals started soon after the CFTC charged the owners of the crypto exchange, including CEO and Co-founder Arthur Hayes, for allegedly operating an illegal exchange, facilitating unregistered trading transactions, and violating rules. Further outflows of funds are likely to continue as the exchange processes withdrawals requests lined up since the previous day. Philip Gradwell, the chief economist at Chainalysis blockchain analysis firm, revealed the withdrawal figure on Friday, October 2, at around 4:30 AM Eastern Standard Time. He tweeted that Bitmex withdrawals are already adding to about 25% more liquidity to other crypto exchanges. Some of the Bitcoin withdrawals are moving to Gemini and other recognized exchanges. Currently, BitMEX still holds between 135,000 and 170,000 Bitcoins, implying that several of its customers are still staying put at least for now. Stable liquidity on BitMEX and other crypto exchanges indicates that there is no serious panic among customers following the CFTC charges. According to data provided by Skew cryptocurrency derivatives research company, open positions in Bitcoin perpetual futures without expiry traded on BitMEX have also declined by almost 22% to $462 million from $592 million. The open interest of the exchange’s Ethereum perpetual contracts has reduced by 37% or $60 million to about $103 million. However, liquidity, as measured by the buy and sell orders, on the exchange remains relatively stable, and the large trades can still be executed at a low cost. Meanwhile, BitMEX owners have announced their intention to fight the US charges. A spokesperson for HDR Global Trading Limited, the parent company of BitMEX crypto derivatives exchange, said: “We strongly disagree with the US government’s heavy-handed decision to bring these charges, and intend to defend the allegations vigorously. From our early days as a start-up, we have always sought to comply with applicable US laws, as those laws were understood at the time and based on available guidance.”Blockchain.news
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