TOP TRENDS ON COINDESK Weak tea Tether issued a report that was supposed to assure the crypto world its dollar-pegged token, USDT, is fully backed by U.S. dollars. But the document failed to impress doubters. That's largely because it wasn't an audit, just a three-page memorandum from a high-powered law firm saying it was "confident" (not convinced, just confident) that Tether had more than enough greenbacks ($2.6 billion) in its bank accounts to collateralize the tokens...on a single day, June 1. If that doesn't sound equivocal enough, the firm admitted that the procedures it performed "are not for the purpose of providing assurance." Mega-disclaimers like that aside, "independent" law firm reviews (paid for by the companies being reviewed) are not held to the same rigorous standard as audits, which have established rules of accountability to third parties who rely on them. But while many say Tether's report hasn't proved anything, others expressed "reassurance and confidence." And as of Friday, USDT was still trading at $1, as it almost always has, despite the lingering doubts. Eye on EOS The EOS mainnet has been live for more than a week now, but it's been far from a smooth ride. After the 21 selected block producers (BPs, the rough equivalent of bitcoin's miners) froze seven accounts to prevent fraudulent activities, questions arose anew about the $4 billion project's protocol design. To some, the account freezes seemed to portend centralization of the nascent blockchain network, though EOS' defenders said it's still early days and credited the project team for the overall way it handled the incident. For a more philosophical take, read blogger Taylor Pearson's critique of the on-chain governance that projects like EOS seek to bring to blockchains. Lost and found In the second crypto exchange hack in two weeks, South Korea's Bithumb lost some $31.5 million in an attack Tuesday night. The exchange soon announced that it would compensate clients' losses from its own reserves. Two days later, Bithumb said that it was working with other exchanges to retrieve stolen funds and so will be able to reduce the total damages. Bithumb suffered the attack despite taking extensive security measures. Reportedly, IT specialists constituted 21 percent of its staff, 10 percent of those employees were responsible for information security, and 8 percent of the annual budget was spent on data protection activities, all in line with regulatory requirements. Days before the attack, Bithumb staff started noticing unauthorized access attempts and performed a server checkup, but still were unable to thwart the attack. Right after news of the hacking broke, bitcoin lost $200 in price, but soon recovered, though the overall trend this week has been downward. On the bright side, the victims of the first major cryptocurrency theft in history, Mt. Gox, got some good news Friday: the bankruptcy proceedings have been paused, and a civil rehabilitation process will begin instead. This means that the money Mt. Gox's clients lost will be refunded according to the latest (still four-figure) bitcoin price rather than $440, the price at the time the bankruptcy proceedings began in 2014. See all CoinDesk stories |