Japanese Internet Giant GMO Postpones Shipments of 7nm Bitcoin Mining Equipment

Japan’s GMO Internet has postponed the shipments of its two lines of 7nm bitcoin mining rigs. A representative of the company has clarified the situation to news.Bitcoin.com, noting that some refunds have already been issued. In addition, the company is planning to relocate its mining operations.
Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space
Shipments Postponed
GMO Internet announced on Monday that it has postponed the shipments of its 7nm ASIC bitcoin mining equipment. The company has two lines of mining rigs: B2 and B3. The former was scheduled to start shipping at the end of October and the latter in November.
A representative of GMO revealed to news.Bitcoin.com on Tuesday that the shipments of both lines have been postponed, elaborating:

quadrigacx.com

It is because the parts we need for our mining machines are actually very difficult to acquire right now … It is difficult to acquire some of the electronic components, such as resistors, due to the tight global supply-demand balance.

He added that the company has not decided whether to ship any miners this year.

quadrigacx.com

GMO Internet launched the B2 line in June and the B3 line in July. In August, the company upgraded the B3 case shape design in order to improve its cooling performance and operational stability. Both B2 and B3 are priced at $1,999 and are sold out.
The representative emphasized that refunds will be issued to any customers who ask for them, noting:

We asked our customers whether they wish us to refund at the time of delay announcement. So far, we have already completed issuing refunds to customers who demanded them.

quadrigacx.com

Relocating Mining Operations
Through its Swiss subsidiary, GMO engages in three mining business areas: in-house mining; developing, manufacturing and selling mining machines; and cloud mining.
On Nov. 5, the company released the monthly report of its mining business which shows that 595 BTC and 875 BCH were mined in October. GMO’s total hashrate increased to 674 PH/s during the month from 479 PH/s in the previous month.
In its quarterly earnings presentation, the company still says it aims “to become No. 1 in the field of cryptocurrency.”
The internet giant further detailed that the mining business recorded a loss during the third quarter even though the expansion of mining facilities progressed as planned. The company attributed the loss to a small net sales increase of only 1.249 billion yen ($11 million) year-on-year “because of a decline in profitability due to the deteriorated macro environment including stagnant bitcoin price and an increase in hash rate,” reiterating:

Cryptocurrency mining business experienced a decline in profitability due to a downturn in the macro environment.

At Monday’s press conference, GMO Internet’s founder and CEO, Masatoshi Kumagai, unveiled his company’s plan to relocate its mining operations in an effort to boost profitability by lowering electricity and production costs.
The GMO representative confirmed the plan to news.Bitcoin.com. However, he noted that the details of location and timeframe are “under consideration at this moment,” emphasizing that “we have not decided it yet.”
What do you think of GMO postponing the shipments of its 7nm bitcoin mining equipment? Let us know in the comments section below.

Images courtesy of Shutterstock and GMO Internet.

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Interview: Horizen (ZEN) President Rob Viglione Reflects on ZenCash Brand Expansion, Teases November Release for Flagship Apps

Interview: Horizen (ZEN) President Rob Viglione Reflects on ZenCash Brand Expansion, Teases November Release for Flagship Apps

Horizen (ZEN), formerly called ZenCash, is a privacy-focused blockchain network with an ambitious goal: to put consumers back in control of their digital footprint. Last week, I spoke with Horizen Co-founder and President Rob Viglione to learn more about Horizen as well as the platform’s recent brand expansion.

What follows are some of the highlights of that interview, as well as a video of the full conversation. Topics covered include the history of Horizen, the reasoning behind the brand expansion, and a lengthy discussion on the future of the project, including two flagship apps which are to be released later this month.

UH: Can you give a quick explanation of Horizen for anyone who isn’t super familiar with the platform?

RV: You know, this is always funny, because you can go back and watch my other YouTube videos, and it probably evolves a little bit every time. Really, the vision is to flip upside-down the last 30 years worth of business model coming out of Silicon Valley, which is essentially: tech companies with these great platforms capture a trove of data that you hand over to them, and they monetize it.

What we’re trying to do is flip that upside-down. Start with a privacy primitive; acknowledge that everyone has a fundamental right to privacy. And now we can start building a platform and applications around that concept. And that’s exactly what Horizen is. We’re using blockchain technology, which we’re evolving to a block DAG, hopefully, if everything works out … to ultimately endow individuals to own their digital footprint, so they can monetize it, or control it, or wipe it, or do whatever they want.

So that’s the vision. We use this technology to get there because we think it’s appropriate for it, and that’s really what we’re all about. We’re building out a decentralized ecosystem that makes sense economically. We’ve thought very carefully about incentives across all stakeholder groups in our system. So you know, it’s a very complex project that we think has simple goals. The goals themselves sound simple, but they’re very difficult to get there.

UH: This phrase, “a fundamental human right to privacy,” comes up quite a bit when you talk about Horizen. Why do you think privacy is something everyone should care about?

RV: We’re digitizing everything. We’re putting our lives on digital platforms. We’re putting our economic well-being on digital platforms. And we’re starting to see now that that leaves people vulnerable. That’s why even governments, like with the European Union and GDPR, are mandating that companies preserve their customers’ data and privacy. So what we’re doing is decentralizing the process and making sure that companies don’t even have the data. So I think what we’re doing is actually very much in line with the intent of what the governments are doing…

I think we’re just trying to apply this philosophy in the consumer domain. What we’re talking about now is going deeper into the product domain and saying, “Hey, maybe even the telecom providers shouldn’t be tracking our geolocation all the time. Maybe your geolocation should be yours. And if you want to sell it to marketers, you can do that!” That should be your choice versus, by using the device, you’re giving up all of your privacy.

UH: What was the original inspiration behind forking ZenCash from Zclassic?

RV: I joined Zclassic because I was fascinated…completely fascinated with zk-SNARKS, you know the zero-knowledge cryptography applied into cryptocurrencies. I thought it was mathematically extremely elegant. I thought, “This is the future of privacy.”

Zclassic was a project with a very narrow mandate. The mandate was essentially to mimic Zcash. Going to ZenCash, we realized that there was so much more that we want to do, but we don’t want to hijack [Zclassic] because the project has value. But [Zclassic] also has value within some very narrow mandate. We want to do so much more. We want to decentralize everything—the governance, the treasury. We want to create a treasury actually! We wanted to take the technology in a completely different direction, looking at sidechains for scalability, on-chain scalability with a block DAG. You know, there was so much that we wanted to do that we had no right to do within the Zclassic mandate.

UH: The white paper for ZenCash was only published in May of last year. Did the vision for ZenCash changed dramatically leading up to the brand expansion, or does the brand expansion just better capture what ZenCash was always meant to be?

RV: Really the latter. The brand expansion going to Horizen was a professionalization of what we had become, and more importantly, where we want to go. We started with this white paper in May of 2017. And we actually rushed through almost everything in that white paper, but there’s so much more that we’ve evolved since then. Sidechains weren’t even part of the original white paper, and to me, sidechains are our future. It’s one of our core technology differentiators.

The other stuff was really cool from a privacy perspective, but it was really a set of products that run with our blockchain. Now we’re talking about completely revamping the blockchain to a block DAG; we’re talking about sidechains. So we had to have a reawakening, or kind of a circle back. The rebrand or brand expansion was actually a huge part of that: capturing the very important messaging stuff. It was a huge effort actually. I can’t even say huge enough times!

UH: What was the process like for the brand expansion? Obviously there’s an inherent risk there; you don’t want to alienate your previous community. What’s the reception been like so far?

RV: So far it’s been phenomenally, overwhelmingly positive. Though of course, initially we had a very small set of people who were very much against it. In anything you do, you’re going to have a distribution of reactions to it. The distribution was very heavily skewed towards, “This is a very positive thing.” Some people completely loved it. I’d say the majority of people really liked it, or maybe loved it. There were people who were indifferent, and on the tail of the distribution, on the other side, you had those who just absolutely despised it. ZenCash was the best thing in the world, and any change from that was absolutely horrible. And that’s fine. And there’s also legitimate criticisms, that maybe they just don’t like it. And that’s fine too.

But the way we did it, we brought on a very professional team of branding experts and embedded them into our marketing team. Then we put together a series of inquiries to our community. We had general surveys to the community and then we had key stakeholders identified that represented a cross-section of our stakeholder set, a very unique cross-section. We had people who were tech-oriented. We had people who were more business oriented. We had people that were key investors. We had people that were actually former regulators, because we wanted to make sure also, “How do regulators see this project?” We don’t want to be antagonistic to regulators…

So really we put together this cross-section of information from different stakeholders and synthesized that. The team was a crack team of  branding experts with our marketers. They digested this trove of information and then teased out the common factors. And the common factors really pointed them towards, “How do people perceive the project today and then where do they want it to go?” And from this, then they started formulating a message around that, a message that captured what people want. And then they spit out a set of names that then we could choose from. From there it went into logo design and then an execution plan to unroll this to the market.

UH: How long had you been working on the brand expansion prior to the reveal?

RV: It was actually a four- or five-month project. And you know, in the grand scheme of things, 4 or 5 months sounds like not so much. But in the crypto world, 4 or 5 months is like 10 years!

UH: What are some of the things you and the team are currently working on to finish out the year?

RV: One of the coolest things we had in our team meeting earlier today — and we do team meetings three times a week, where we have all hands and all the divisions report the big stuff that they’re working on — and the coolest thing was the product team came forward with the final delivery of our flagship product. So we’re not even calling it a wallet anymore, because we’re going beyond just being a wallet. Ultimately this thing is going to be an amazing kind of all-inclusive application. We just received that, going through multiple iterations on it, and we’re in the final iteration now. We’re testing it and everything is looking amazing…

So I’m super excited. We’re going to announce an actual release date, but it’s going to be the end of this month. So the end of November you’re going to have two amazing products hit market that I think will differentiate us…

On the core technology side, what gets me most excited is the sidechain stuff. The sidechain stuff is absolutely critical for our future direction, where we want to go as a platform, and for massive scalability. Because now, rather than trying to force everything through the main chain, we can start parsing off specific things, like a tokenization sidechain. And now anyone that wants a nice, rapidly scalable, massive transaction throughput, absolute secure token standard, you can now use a Horizen sidechain. To me that’s absolutely critical, because now there’s a whole set of business you can build on that.

UH: How do you view Horizen’s place within the broader cryptocurrency industry. You mention that you don’t necessarily see yourselves as having to be in direct competition with everybody. That being said, Horizen does seem to be combining some of the features that you’ll find in different blockchain platforms. Can you speak to that a little bit?

RV: Absolutely. The way that I view us in the competitive space is, we’re building out a platform that’s very privacy centric and massively scalable. What does that mean in terms of competition on the market? We do want to take a position where, if you’re a business and you want to build on a blockchain, or you have a dApp and you want to build on a blockchain, you would choose our sidechain to do it…

If you look at the different dimensions of this industry, you’ve got smart contracting, you’ve got platforms without necessarily smart contracting, you’ve got different types of privacy mechanisms and different types of business functionalities. If you look at all of these, we have some unique characteristics. I think the industry needs a lot of competition and a lot of experimentation across all of them.

I think we’ll forge our space, where, you know, we’re very business oriented. Our team is very well structured, very organized… Our approach is, we’re not just creating an infrastructure and saying, “Here, come plug into it.” We are saying we will dedicate a team to actually integrate you and make sure you have a great user experience, for instance—which is something that’s a little different. The industry has been more about, “Let’s create technology and then people will come and use it.” We want to build technology that suits users’ requirements and then we help them use it to make sure that they have a phenomenal experience. That’s our approach to things. So for segments of the industry where that matters, I think we’ll be a very competitive player.

The post Interview: Horizen (ZEN) President Rob Viglione Reflects on ZenCash Brand Expansion, Teases November Release for Flagship Apps appeared first on BitcoinLinux.

Thailand Uses Blockchain-Supported Electronic Voting System in Primaries

Thailand’s Democrat Party has become the first political party to use blockchain technology to elect its leaders in a primary election, which was held from November 1–9, 2018. In a live e-voting system, more than 120,000 party faithful cast their votes in a transparent way that saw former Thai Prime Minister Abhisit Vejjajiva winning his party nomination with 67,505 votes.Party members were able to vote using two methods. The first method was through voting stations that utilized a Raspberry Pi-based system. Voters were also able to vote via a blockchain-based mobile app that asked voters to submit their photo ID.The identification documents used to verify party members and the voting tallies were both encrypted and stored on the InterPlanetary File System (IPFS), a decentralized and distributed file system for storing large volumes of data. IPFS uses a peer-to-peer protocol where nodes store a collection of hashed files on a network. For this election, the IPFS hashes were stored on the Zcoin blockchain, which acted as an “immutable database and provided auditability to the Thai Election Commission and the Democrat Party candidates.”“I am very proud that Zcoin played a role in making Thailand’s first large-scale e-vote, a reality, which saw greater voter participation and transparency,” Poramin Insom, founder & lead developer of Zcoin, noted in a public statement.To keep the voting data and documents safe, the encryption keys were split using the Shamir’s Secret Sharing Scheme, which works similarly to a multi-sig key used for crypto wallets. With a multi-sig key, multiple private keys are required to access the funds. With the Shamir Scheme, multiple custodians are required to decrypt the voting data. At the recently concluded primary election, five individuals were needed to decrypt the voting data; representatives of each candidate, an official from the Thai Election Commission and a representative from the Democrat Party.“I believe we’ve achieved a huge milestone in our country’s political history and hope that other political parties or even the government, not just in Thailand but the region, can look to using blockchain technology in enabling large-scale e-voting or polling,” Insom stated. Earlier this month, West Virginia ran a blockchain trial in the federal general election for military and other Americans living abroad. The state used the mobile app developed by blockchain startup Voatz to verify voters’ identities using facial recognition technology by comparing it to other photo ID that might have been uploaded on it during voter’s registration. Swiss city Zug ran a similar trial using a different app from uPort, which issued digital identities to residents who cast their votes using their smartphones.Blockchain voting has its skeptics; however, a report from the Brookings Institution think tank, sees blockchain voting as a “beneficial tool for the election commission to maintain transparency in the electoral process, minimize the cost of conducting elections, streamline the process of counting votes and ensure that all votes are counted.”

This article originally appeared on BitcoinLinux.

Bitfury Acquires Minority Stake in Final Frontier, Aims To Expand Services

The Bitfury Group has acquired a minority stake in blockchain services firm Final Frontier. Both organizations are looking to utilize each other’s knowledge and experience in the traditional and digital finance spaces to potentially release a new line of financial products and services designed to assist professional investors in getting their hands on digital assets.“Our mission is to be the bridge for institutions from traditional finance to enter this innovative asset class,” said Final Frontier co-founder Imraan Moola in a public statement. “Bitfury’s technological expertise, combined with our financial markets know-how and track record will allow us to create unique and differentiated financial products and solutions to service our sophisticated investor base.” Bitfury is a full-service blockchain technology company that started out with a focus on cryptocurrency mining. Among the company’s latest hardware releases are semiconductor chips and mobile data centers. Bitfury is also the developer behind other blockchain projects including Exonum, a private blockchain framework; Crystal Blockchain, an advanced analytics platform; and LightningPeach, an open-source Lightning Nnetwork project. Based out of Switzerland’s renowned Crypto Valley, Final Frontier is a cryptocurrency and blockchain investment firm. Among the venture’s main goals are helping professional traders and investors enter the crypto space. Bitfury CEO Valery Vavilov states, “This is a ground-breaking partnership between a blockchain technology firm and an experienced team from traditional finance. With the blockchain space institutionalizing, we consider it an important step forward for the entire ecosystem and for our own mission to be the world’s leading full-service blockchain company.” News of the partnership comes only days after Bitfury closed a Series C, $80 million funding round led by Korelya Capital. Funds will be used to further develop the company’s exploration of emerging technology and boost its software and hardware equipment. Its partnership with Final Frontier raises questions about whether Bitfury may be trying to expand its reach into investment services.  BitcoinLinux reached out to Bitfury for comment. The company said that it was unable to “provide more details at this time,” but it was “looking forward to sharing more details in the future.” Final Frontier also did not respond to our request for comment.

Genesis Mining

This article originally appeared on BitcoinLinux.

Bitcoin Group SE Buys Investment Bank Tremmel for Undisclosed Figure

Bitcoin Group SE has bought 100 percent shares of investment bank Tremmel for an undisclosed amount. This is the German digital currency exchange operator’s second acquisition in 2018. Bitcoin Group, which holds current assets of $40 million, said Tremmel allows it to issue its own cryptocurrency-related products, conduct proprietary trading and operate bitcoin ATMs.
Also Read: Sompo Holdings Acquires 10% Stake in Kenyan Cryptocurrency Exchange Bitpesa
Acquisition to Expand Bitcoin Group Services Portfolio

The Frankfurt Stock Exchange-listed company operates Bitcoin.de, Germany’s only regulated digital currency exchange, trading BTC, BCH and ETH. It hopes to use Tremmel’s banking license to expand the range of its service portfolio. For example, Bitcoin Group said it is now possible for the trading platform to maintain an order book and even quote prices, while simultaneously ensuring more liquid trading.
“We are very pleased that in Tremmel Wertpapierhandelsbank Gmbh…we have been able to gain an excellently positioned partner with in-depth knowledge of the market,” Marco Bodewein, managing director of Bitcoin Group, said in an online statement on Nov. 12. “This will enable us to take the corporate development of Bitcoin Group SE to a new level,” he added.

The deal is expected to be completed in the first half of 2019, subject to approval by relevant regulatory authorities. Bitcoin Group did not disclose the actual purchase price, but said “it is in the lower seven-digit euro range.”
Rainer Bergmann, the previous sole shareholder and managing director of Tremmel, is to continue working at the investment bank in the same capacity. The bank, which trades shares, bonds and other stock exchange products on behalf of local and foreign banks, insurance companies and asset managers, will be expanded into a deposit-taking institution, Bitcoin Group said.
Restructuring
Digital currency exchanges are looking for growth in new areas or to consolidate existing positions to help boost revenue and minimize risk from an uncertain regulatory environment in their home economies.

In January, Bitcoin Group, which has 753,000 investors actively using its exchange to buy and sell digital assets, bought a 50 percent stake in financial investment broker Sineus Financial Services Gmbh, to diversify risk. “In the future, this will enable the group to offer additional financial services in the cryptocurrency sector,” the company said at the time.
For the first six months of this year, Bitcoin Group reported net profit increase of 306 percent to $3.85 million from $0.95 million a year earlier. Revenues tripled to $6.57 million from $2.1 million in the comparable period a year ago. Operating profit climbed 368 percent to $5.64 million. The exchange said about $707.6 million worth of BTC was traded on the platform at the end of last year, when the price of the cryptocurrency peaked at $20,000.
After close Tuesday, shares of Bitcoin Group were down 0.36 percent at $31.41 in Frankfurt trading. Over the past 52 weeks, the stock has reached a low of $28.02 and a high of $97.18.
What do you think about Bitcoin Group’s latest acquisition? Let us know in the comments section below.

Images courtesy of Shutterstock.

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The post Bitcoin Group SE Buys Investment Bank Tremmel for Undisclosed Figure appeared first on BitcoinLinux.

Ripple Files to Move Securities Lawsuit from State to Federal Court

Ripple’s legal team in their ongoing securities suit is attempting a new tack: to have the claim proceed at the federal level.In a move that legal commentator Jake Chervinsky described as “seriously crafty,” Ripple has filed a formal notice-of-removal motion to have their most recent securities suit, Zakinov et al v. Ripple, tried in a federal court rather than at the state level.  In the notice of removal, the defendants, which include Ripple and its CEO Brad Garlinghouse, among others, request that the court “remove the … civil action, and all claims and causes of action therein, from the Superior Court of the State of California, County of San Mateo, to the United States District Court for the Northern District of California.”The class action is a consolidation of three separate suits filed by Vladi Zakinov, David Oconer and Avner Greenwald “on behalf of all California citizens who purchased or otherwise acquired XRP from January 1, 2013 to the present.” It claims that since Ripple has failed to register with the U.S. Securities and Exchange Commission (SEC), XRP has been sold as an unregistered security, and the combined class action is seeking nearly $17 million in damages.Swamped with legal troubles, Ripple has sustained several legal challenges to their sale of XRP tokens, with many alleging that these token sales constitute securities fraud. Although Ripple has yet to face any serious consequences as a result of these battles, facing three securities suits in a single year could prove to be a serious strain on Ripple’s resources. This latest attempt to plead their case at the federal level may set vital precedent, if successful. A federal clarification on the interaction of securities laws and token sales could shut down future cases before they even begin.This appears to be the pretext for attempting to move this suit to a different court system, at least. As Chervinsky went on to elaborate, a suit argued on Ripple’s behalf in the state of California could also serve as a precedent to stop the tide of frivolous securities lawsuits levied at Ripple.At this early stage in the fight, Ripple’s legal team could also believe “they have better odds of winning in federal court than in state court (or else they wouldn’t be trying so hard to remove the case),” Chervinsky continued. To be clear, the notice of removal still needs to be approved by the Superior Court of the State of California, County of San Mateo, before it is bumped up to the federal circuit. Following the notice, the plaintiffs submitted a filing to request that the case persist at the state level.

This article originally appeared on BitcoinLinux.

Bitmain Sues Anonymous Hacker Over $5.5 Million Theft

Chinese mining giant Bitmain is suing an anonymous hacker that allegedly stole $5.5 million in cryptocurrency last April from the company’s account on the digital exchange Binance.The hacker’s identity is still unknown, and he’s described only as “John Doe” in official court documents, which were filed in accordance with the lawsuit on November 7, 2018, with the U.S. District Court for the Western District of Washington in Seattle. The documents state that the hacker managed to take over the company’s Binance account, then use bitcoin stored in the account to purchase ether tokens. These tokens were utilized to buy and manipulate the price of an altcoin known as MANA coin (MANA). John Doe then transferred the MANA into a separate Binance account they controlled. The documents explain, “Upon further information and belief, John Doe took his/her market manipulating and theft scam a step further by essentially reversing the same orchestrated trades between Bitmain’s wallet and John Doe’s wallet using a deflated MANA price. While accessing Bitmain’s digital wallet without authority, John Doe placed an order to sell MANA out of Bitmain’s digital wallet at a deflated price. At the same time, John Doe placed a purchase order for MANA at that deflated price from John Doe’s Binance wallet.” They continue to say, “Binance’s automated system matched the deflated MANA sell order with the deflated MANA purchase order and executed the trade, and John Doe obtained significant gains at the expense of Bitmain. As a result, John Doe benefitted twice from transferring MANA into and out of Bitmain’s digital wallet.” Once these steps were completed, the court filing reports that the hacker transferred all the crypto funds from the theft into a wallet on Bittrex, a competing digital asset exchange. John Doe then cashed in on the profits and disappeared. The documents say the hacker willingly and knowingly accessed a protected computer without appropriate permission with the intention of defrauding Bitmain. “By means of such conduct, John Doe furthered the intended fraud and obtained things of value, specifically bitcoin and other digital assets, causing a loss to Bitmain exceeding $5,500,000,” the filing states. Specifically, the documents assert that the defendant’s actions are a violation of the Computer Fraud and Abuse Act (CFAA), and that Bitmain is entitled to specific damages under the Act’s provisions. It was reported last month that losses incurred by hacks on digital exchanges during the first nine months of 2018 exceed the total losses of 2017 by roughly 250 percent and that approximately $950 million has been stolen this year. To view the court filing in full, click here.

This article originally appeared on BitcoinLinux.

Regulations Roundup: Chinese Mining Farms Undergo Tax Inspection, Michigan Bans Campaign Donations in Cryptocurrency

In recent regulatory news, we report on an authorized mining company in China that has had its operations temporarily halted for tax inspection and implementation of real-name registration processes. We also look at the Michigan Secretary of State’s ban on crypto-based political donations, as well as the recent certification of X8’s stablecoin for Shariah compliance. In addition, we focus on the operator of a fraudulent cryptocurrency scheme who has been punished for misappropriating $601,000 in BTC and LTC from his employer.
Also Read: President of Marshall Islands Challenged Over Cryptocurrency Plan
Chinese Mining Farms Suspended
According to a statement published by an unidentified cryptocurrency mining company, Chinese state agencies have ordered the suspension of its mining farms in southwestern Guizhou Province and the Xinjiang Uyghur Autonomous Region for tax inspections and to implement real-name registration processes.
“According to the needs of the public security department’s network information security work, in the future, our company will implement higher standards for the company’s business real-name system according to the work needs of the public security department,” the anonymous company said. “For customers with the latest standard real-name systems, the data center will have to suspend reloading, restarting, moving in and out, etc.”
Michigan Secretary of State Says ‘No’ to Crypto
In a letter addressed to William Baker, a recent candidate for the Michigan state legislature, the office of the Michigan Secretary of State has formally barred cryptocurrency donations to political campaigns.
Baker, who lost his bid in the state’s Nov. 6 election, had previously sought clarification on how the value of donations in the form of cryptocurrencies should be recorded. He also asked whether virtual currency exchanges would qualify as valid secondary depositories for the storage of crypto assets.
Baker asserted that “it is self-evident that digital currency is a valid way to receive political contributions.” However, the state secretary’s office responded by stating that “the law does not authorize such a vehicle, and the department has never determined that digital currencies are a valid way to receive political contributions.”
The letter also highlighted concerns pertaining to the price volatility of cryptocurrencies. “As with stocks and commodities, bitcoin’s worth fluctuates daily,” the office said. “There is no way to ascertain the precise monetary value of one bitcoin on any particular day.”
The Michigan Secretary of State raised additional objections to the use of cryptocurrencies as donations. In the letter, the office added that state legislation also “requires that committees deposit funds in an account in a financial institution, which is not an option for cryptocurrency.”
X8 Stablecoin Certified as Shariah Compliant
X8C, the stablecoin issued by Swiss fintech company X8 AG, has obtained a certificate showing that its stablecoin is compliant with Shariah law. It received the certification from the Shariyah Review Bureau, an Islamic advisory firm licensed by the Central Bank of Bahrain.
Francesca Greco, director and co-founder of X8, announced that the company will soon establish a regional office in the Middle East. Greco also indicated that X8 plans to launch a Shariah-compliant virtual currency exchange, adding that the company has already met with representatives of exchanges based in Abu Dhabi, Dubai and Bahrain.
“The Gulf region is a really good place for financial technology companies, because they all want to become hubs for fintech,” Greco said.
CFTC Fines Crypto Scheme Operator Over $1.14M
The U.S. Commodity Futures Trading Commission (CFTC) has ordered Joseph Kim, a resident of Phoenix, to pay more than $1.14 million for operating a fraudulent cryptocurrency scheme. Kim was also sentenced to 15 months in prison on “related criminal charges” filed in the U.S. District Court for the Northern District of Illinois. According to the court order, Kim pleaded guilty to “orchestrating a fraudulent Bitcoin and Litecoin scheme that led to more than $1 million in losses.”
Kim was found to have misappropriated $601,000 worth of BTC and LTC from his employer — described as “a Chicago-based proprietary trading firm” — before attempting to fabricate security-related issues to obfuscate the misappropriation of funds. Despite this, the company fired Kim in November 2017 after the theft of the cryptocurrency was discovered.
Between December 2017 and March 2018, Kim then sought to repay his former employer through profits that he had generated through the operation of a cryptocurrency trading scheme. According to the CFTC, he “falsely told customers that he would invest their funds in a low-risk virtual currency arbitrage strategy, when, in fact, Kim made high-risk, directional bets on the movement of virtual currencies that resulted in Kim losing all $545,000 of his customers’ funds.”
Do you think Chinese miners will report the temporary suspension of their operations for tax inspection and real-name registration? Share your thoughts in the comments section below!

Images courtesy of Shutterstock

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OKEx Adds Support for the Vietnamese Dong on Its Fiat-to-Crypto Platform

Malta-based cryptocurrency exchange OKEx has added the Vietnamese Dong (VND) on its Customer-to-Customer (C2C) trading system, enabling Vietnamese customers to exchange their fiat currency for tokens on the platform.The C2C platform was created by OKEx in 2017 as a peer-to-peer platform where users can buy and sell cryptocurrencies using fiat currencies. OKEx’s Head of Operations Andy Cheung noted that the addition of the VND on the company’s fiat-to-token platform would drive the adoption of cryptocurrencies in Vietnam.“Vietnam is one of the most important blockchain hubs in Southeast Asia. We see a significant growth in the use of cryptocurrencies in this market,” Cheung added.Trades made on the C2C platforms won’t incur any transaction fees, according to the release. The exchange also plans to introduce market makers (merchants) in the future. Merchants are verified traders who have enough reserves to facilitate transactions on the platform. The digital asset platform requires a security deposit from qualified merchants before they can be accepted on the platform.According to the company’s website:”Market makers help serve a larger number of crypto enthusiasts and hence support a high trading volume. OKEx examines every merchant on the C2C platform. Every merchant on the platform needs to declare their digital assets which must exceed OKEx’s internal requirements to get qualified and to trade.”OKEx, which recently dislodged Binance as the largest crypto exchange by trade volume, added four stablecoins to the list of assets available for trading on its token-to-token platform in October 2018. The exchange also announced its expansion to the U.S., having secured money transmittal licenses (MTLs) from 20 states across the U.S., excluding New York and Washington, D.C.

This article originally appeared on BitcoinLinux.

IBM Submits Patent For Open Scientific Research on the Blockchain

IBM Submits Patent For Open Scientific Research on the Blockchain

IBM has submitted a patent application that promises to bring the blockchain to scientific research and facilitate data sharing. The new technology would allow researchers to follow their work as it moves between (and is used by) other institutions. The process outlined in the patent would essentially allow the blockchain to serve as a tamper-proof research log.

The proposed blockchain would provide a sequence of blocks that represent different packages of research data. One block would be made up of the research data itself, and the next would be composed of the analysis performed on the previous block. The proposal would also allow “summary” and “correction” blocks to be added to the chain, allowing information to be expanded upon but not deleted.

The patent acknowledges that similar but “limited” platforms exist to serve the same purpose and facilitate research sharing. However, most of those platforms have no way to guarantee that data is trustworthy or reliable. By contrast, the blockchain’s distributed ledger can ensure that data cannot be modified.

The patent was created by four members of a research group at IBM’s Watson Research Center: Jae-wook Ahn, Maria Chang, Ravindranath Kokku, and Patrick Watson. IBM originally filed the patent last December, but this is the first time the patent application has been made public. It is not clear if or when the patent will be approved, or when an actual product will come to fruition.

IBM and the Blockchain

IBM has become a major innovator in the blockchain world, and has submitted 89 blockchain patents according to a recent survey — just one less than the leading creator of blockchain patents, Alibaba.

However, IBM’s role in blockchain development goes beyond filing patents and includes many live blockchain systems. IBM has accumulated several blockchain partnerships and clients, and its blockchain technology has been applied to a variety of situations.

Previous uses for IBM’s blockchain include cross-bank trading, business-oriented smart contracts, and everything in between. Most recently, IBM’s Food Trust platform has made major changes to the food supply chain. With more patents in the pipeline, IBM’s blockchain efforts are unlikely to slow down.

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