Wednesday, January 9, 2019

Going for a (bank) run 🏃‍♂️

January 9, 2019

French Yellow Vests are Planning a Run on the Banks

Gilets Jaunes

For weeks French protestors have gathered in the streets of Paris to protest for economic justice.

Dubbed Gilets Jaunes from the bright yellow vests that members wear, the movement has now gathered hundreds of thousands of supporters.

While in the past their plans have been fairly straightforward (i.e. protesting in the streets), the group is allegedly now planning something to show the fragility of the financial system - a run on the banks.

Bank runs in a nutshell

The concept of a bank run is simple: everyone withdraws their funds from a bank at the same time.

When this happens, there is fear that the bank could run out of cash to give customers. This causes more withdrawals.

Eventually, it's possible a bank goes belly up in its attempt to pay out customers since it does not have the cash on hand to do so. Though some government now insure deposits to protect against this, its only up to a certain limit.

Why are we talking about this...

Because bank runs are a thing of the past when you are your own bank. Unless you hold your crypto on centralized exchanges or wallets, nobody can freeze or censor your withdrawals - a fundamental reason to own cryptocurrencies.

In contrast, banks could limit the amount of money they let you take out, even though it's "your" money.

Will the Gilets Jaunes bank run matter?

While experts don't believe the coordinated bank run will be powerful enough to break banks, it's a message nonetheless.

To one activist, the attack on money is "our elected officials' worst nightmare."

NEWS

Exchange Confirms ETC 51% Attack, Reports $200,000 Loss

Attack ongoing

Yesterday, reports surfaced that Ethereum Classic was victim to a 51% attack.

A 51% attack occurs when a single party gains control of more than 50% of a network's processing power. Once the attacker gains majority control, they achieve the ability to essentially control the blockchain.

Despite developers claims on Monday that the attack was terminated, new reports say that the attack continued on to Tuesday.

Gate.io speaks out

Cryptocurrency exchange Gate.io confirmed the 51% attack in its blog post and said that the attack extended past Monday.

The exchange reports that it lost a total of 40,000 ETC (about $200,000) due to double spending.

No users funds will be lost, as the exchange will refund users for the lost tokens.

Developers in disarray

Ethereum Classic developers are taking different stances about what is going on with their network.

Some are acknowledging that what is occurring is indeed a 51% attack. Others are hesitant to comment before they have more information.

Ethereum classic developer Cody Burns talked about the situation:

"We have been discussing options [to] mitigate the current threat, but no one wants to make a hasty decision that would expose greater security threats."

CONTROVERSY

Steemit Bans Hacking Group from its Platform

Who are the hackers?

A group of hackers that refers to themselves as "thedarkoverlord" recently threatened to release or withhold documents pertaining to the 9/11 terrorist attack if a ransom is not paid in Bitcoin.

The hackers are demanding $2 million dollars worth of Bitcoin from anyone who wishes to see the documents or have them destroyed.

Banned from Steemit

Steemit, a decentralized social media platform, has banned "thedarkoverlord" from its platform due to a violation of its terms of service. The group had already been banned by Twitter.

Some users of Steemit are upset about the censorship as the site is supposed to be decentralized and not able to be censored.

While the group is banned from Steemit, their posts will live forever on the Steem blockchain. They just won't be displayed on Steemit.

BITS

But wait, there's more...

🇯🇵 Japan financial watchdog denies rumors that it was considering approving a Bitcoin exchange-traded fund.
🏦 ShapeShift just laid off 37 employees amid crypto winter.
⛏ Bitcoin miner manufacturer Canaan is considering an IPO.

MEME