QuadrigaCX / Jack Dorsey / Venezuela / India

Subscribe | View in browser $BTC (1:51 p.m. EST): $3,482.12 (-0.01%) // 90-day high: $6,860.85 // 90-day low: $3,286.14 / / More… $BCH ABC (1:51 p.m. EST): $119.33 (0.38%) // 90-day high: $632.22// 90-day low: $80.95 // More… $ETH (1:51 p.m. EST): $108.14 (0.30%) // 90-day high: $229.12 // 90-day low: $85.11 // More… $LTC (1:52 p.m. EST): $34.23 (1.95%) // 90-day high: $54.64 // 90-day low: $22.09 // More… $XRP (1:52 p.m. EST): $0.30 (-0.08%) // 90-day high: $0.53 // 90-day low: $0.28 // More… Here are the 10 most important stories about bitcoin and cryptocurrencies today       1. QuadrigaCX, a crypto exchange based in Canada, said it cannot repay most of its $190 million in client holdings after its founder, Gerald Cotton, died in December. Cotton's widow Jennifer Roberston said her late husband was the only person who knew the passwords to its cold storage account. When the 30-year-old died unexpectedly in India, those left at the exchange claim to have no way to access the locked funds. As a result, the exchange has filed for creditor protection. Roberston said she has her husband's laptop, but does not know the password. A technical expert brought in failed to get past the encryption. Of course, a case like this has fueled speculation of a conspiracy that Cotton's death was faked or the pretext for an exit scam. –GIZMODO       2. Twitter CEO Jack Dorsey continued his support of bitcoin during an interview with podcaster Joe Rogan. Dorsey, who's payment company Square has been a long supporter of bitcoin, said that bitcoin is best positioned to become the internet's native currency, echoing a similar claim he made last May. "[Bitcoin] was something that was born on the internet, that was developed on the internet, that was tested on the internet…It is of the internet," Dorsey said. The interview has gotten a negative reaction online with more than 49,000 dislikes on YouTube. –COIN TELEGRAPH       Ad Build Proficiency with IoT while Exploring Azure IoT Tools and Technologies Developing applications for the Internet of Things is a balancing act. From avoiding business interruptions to factoring in security, there's a lot to consider. Find the resources you need to work through technical challenges in one, convenient place.   3. Bitcoin set another volume record in Venezuela last week as the digital coin continues to show its value in the face of ongoing political turmoil. The bolivar, Venezuela's national currency, has suffered from hyperinflation along with a lack of foreign currency leaving residents with few options to hold wealth. Bitcoinist reporter Esther Kim references data from Coin Dance, a bitcoin statistics and analytics community that uses data from LocalBitcoins. Coin Dance, which does not list an owner (if anyone knows them please hit reply on this email and let us know), said that $17.1 billion in Venezuelan bolivars traded hands last week (worth about $170 million). This volume comes as the Venezuelan government has made it illegal for residents to use any cryptocurrency beside the Petrol, the government's own cryptocurrency. –BITCOINIST       4. The Indian government has raised concerns that allowing cryptocurrency payments could devalue the rupee in the long term. The fears have some credibility. The Bank of International Settlements released a report last March claiming that digital coins might destabilize traditional currency if they are offered widely to the general public. These risks, though, are seen as more of a long-term issue opposed to something that could have an impact even in the next few years, according to the same report. The Indian government created a committee in 2017 to explore the use of cryptocurrencies. The committee is in the advanced stages of drafting regulations for the country. –QUARTZ       Ad Intelligence is creating stronger connections. Today's world generates 2.5 quintillion bytes of data every day. Sifting through that much available information is hard. Micron is helping analyze that data to create stronger connections between AI, organizations, and most importantly, people.​​ Learn More. 5. Bitfury has partnered with Commons Foundation, a research and development firm based in South Korea, to launch a mining operation in Paraguay. –COINDESK 6. CoinGate, the popular cryptocurrency payment processor, has added support for XRP. –COIN TELEGRAPH 7. A writer makes that case that Bitcoin's launch more than 10 years ago turned out to give early investors an equitable opportunity to invest, especially when compared to more recent u​​​​ICOs. –BITCOIN EXCHANGE GUIDE 8. Bitcoin has found itself "paralyzed" at $3,400 per coin as most major coins saw slight losses early Monday. –FX STREET 9. A bill moving through the New Hampshire state legislature that would allow citizens to pay taxes in bitcoin took another major step toward becoming law. –AMB CRYPTO 10. Developers of online games continue to use ERC-721 tokens to incentivize gamers. –CRYPTO COIN SPY       Written and curated by David Stegon. He has been a reporter for 15 years, the past 10 focused on technology. Follow him @davidstegon. Editing team: Lon Harris (editor-in-chief at Inside.com, game-master at Screen Junkies) and Susmita Baral (editor at Inside, recent bylines in NatGeo, Teen Vogue, and Quartz. Runs the biggest mac and cheese account on Instagram).       Ad Owl Labs is the creator of the Meeting Owl, the first 360-degree smart conference camera. Learn more.

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Kraken's 9-figure buy

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February 4, 2019 FUTURES MOVE: Crypto exchange Kraken has officially acquired regulated futures trading startup Crypto Facilities in a deal valued at at least $100 million. Announced Monday, the "nine-figure" acquisition – the largest seen in the industry thus far in 2019 – will enable Kraken customers to trade spot and open positions offering exposure to the future price movements of cryptocurrencies, all through a unified trading interface. Kraken CEO Jesse Powell framed the merger as one that would "massively accelerate" his company's roadmap, enabling the San Francisco-based startup to sidestep years of effort in order to obtain the licenses and approvals necessary to offer a competitive service in Europe. Founded in 2014, Crypto Facilities is registered with the U.K. Financial Conduct Authority and the deal was approved by the regulator, the parties involved said.  In addition to offering cash-settled futures trading for bitcoin, bitcoin cash, XRP, litecoin and ether trading pairs, Crypto Facilities notably provides data to the CME CF Bitcoin Reference Rate, an index created in collaboration with CME Group and that powers that entity's U.S. futures offering, a relationship that will continue following the acquisition. Powell told CoinDesk: "The deal brings our total developer team to over 100, and will accelerate Crypto Facilities by enabling us to add more assets. We plan to launch more contracts in the medium-term and Kraken also has plans to launch more assets." Full Story​ LONG-TERM THINKING: Malta-based cryptocurrency exchange Binance has an ambitious mandate for its 400 employees in 2019: leverage industry partnerships to diversify the brand beyond its primary trading platform. Trust Wallet, which Binance acquired last summer, recently joined the Foundation for Interwallet Operability (FIO), CoinDesk has learned. The coalition includes the exchange ShapeShift, and wallet startups BRD and MyCrypto, among many others. The coalition plans to build a protocol to standardize crypto wallet addresses across currencies and platforms. Boosters say this protocol could eventually introduce new features to the broader fintech ecosystem, such as giving e-commerce platforms the ability to refund crypto purchases directly to a personal wallet and users the ability to send payment requests using someone’s email, comparable to apps like Venmo. Since the protocol has a native token for processing fees, scheduled for beta testing later this year, FIO founder David Gold told CoinDesk that the value proposition for participating exchanges is clear: “They get income from being a block-producing node on the network.” Although it would probably take years for FIO to potentially offer Binance a significant revenue stream, Lin said the exchange’s bear market strategy is to focus on projects with long-term payoffs. "It will ultimately come down to impact," Lin said. "What else can we do to remove the roadblocks?" Full Story​ SEEKING DATA: The U.S. Securities and Exchange Commission (SEC) is seeking a tool to provide a Big Data view across major blockchains. In a solicitation notice published Thursday, the regulator said it is looking for both small and large businesses who can provide data for the “most widely used” blockchain ledgers based on transaction volume, in order to “monitor risk and improve compliance” related to cryptocurrencies. The SEC said it requires the data in an “easily reviewable” format, along with an overview of how the information is extracted and converted to ensure “there is no loss in data completeness and accuracy due to the data transformation tools and processes applied.” Notably, the agency is seeking to identify transaction details among “the universe of available information.” Interested vendors should respond to the SEC by Feb. 14, according to the announcement. Full Story​ SIM-SWAP CHARGES: A 20-year-old man has been formally charged in a New York Supreme Court indictment over SIM-swapping identity and crypto theft. The Manhattan District Attorney's Office said Friday that Dawson Bakies, a resident of Ohio, is charged with stealing identities and the cryptocurrency holdings of over 50 victims across the U.S. from October to December last year via SIM-swapping attacks. The indictment lists 52 counts of “identity theft, grand larceny, computer tampering, and scheme to defraud” among other charges. “The indictment represents the first prosecution for SIM swapping by authorities in New York," the Attorney's Office said. It’s alleged that Bakies fraudulently linked victims' cellphone numbers to his own iPhones, using them to bypass two-factor authentication (2FA) security measures to access victims’ online accounts, including cryptocurrency platforms. Among the victims, he managed to access 18 online accounts belonging to three Manhattan-based individuals and stole about $10,000 in cryptos. He also attempted to extort one of the victims by demanding a bitcoin ransom, according to the Attorney's Office. Sending a warning to SIM swappers, Manhattan District Attorney Cyrus R. Vance, Jr., said: "We know what you're doing, we know how to find you, and we will hold you criminally accountable, no matter where you are." Full Story​ Every quarter, CoinDesk Research surfaces the key data, trends, and events with its State of Blockchains reports. As our research efforts evolve and expand, we hope to provide amplification to perspectives within the crypto community. We reached out to analysts, builders, and lawyers to understand the industry from their unique vantage point. You can check out the full article, but here's a quick snapshot: “Q4 saw the price of bitcoin and other digital assets take new investors full circle from hilariously rich to predictably rekt.” - Zack Voell (@zackvoell) Messari (Analyst) “I expect to see impressive growth of the entrepreneurial portion of the community, thanks to an ever growing set of tools built specifically to empower new breeds of Bitcoin businesses.” - Vin Armani (@vinarmani) CoinText (Chief Technology Officer) “Expect more litigation and enforcement against exchanges of cryptoassets, ICO issuers, promoters, and persons acting without required licensure as broker dealers and syndicators of ICOs in the coming years.” - Andrew Hinkes (@propelforward) Athena Blockchain (General Counsel / Co-Founder) We want to hear your perspective too! Do you have thoughts on the crypto industry? Do you want to add to the conversation? Do you want to help shape the direction the ecosystem moves in? If the answer is yes to all three of those, please fill out our survey. We will be releasing this in the coming weeks with tons of insights provided by…none other than YOU! For more research insights, check out the CoinDesk Crypto-Economic Explorer here to see this table and more.  POSITIVE PATTERN: Bitcoin’s slow drip sell-off seen over the last six weeks has resulted in the formation of a falling wedge – a bullish reversal pattern – on the daily chart. A break above $3,450 would confirm a wedge breakout and open the doors to the crucial resistance lined up at $3,658. Full Story​​ BEST OF THE BEST MARKETS INSIDER: Nvidia may be selling more graphics processing chips to crypto miners than it is letting on, according to a report from Markets Insider. The article quotes RBC Capital Markets analyst Mitch Steves as saying that, based on the combined hashrate of cryptocurrencies that are mined with GPUs, total crypto revenue from April 2017 to July 2018 should be around $2.75 billion. Of that, Nvidia has a 75 percent market share, and AMD the remaining 25 percent. While AMD’s stated crypto-based earnings of $234 million roughly match that breakdown, Nvidia’s do not. "We think NVDA generated $1.95 billion in total revenue related to crypto/blockchain," Steves said in a note published last Wednesday. "This compares to company's statement that it generated around $602 million over the same time period." The numbers can’t be confirmed however, he added. THE REST FORBES: Jack Dorsey, CEO of Twitter and payments processor Square, has again predicted that bitcoin will become the "native currency" of the internet. According to Forbes, Dorsey made the comment in a podcast interview with Joe Rogan on Feb. 2, saying: "I believe the internet will have a native currency and I don’t know if it’s bitcoin. I think it will be [bitcoin] given all the tests it has been through and the principles behind it, how it was created.” Square enabled bitcoin purchases in its Cash App because “we wanted to learn about the technology, and put ourselves out there and take some risks," he added. QUARTZ: The government panel currently drafting rules for India’s cryptocurrency ecosystem is concerned about possible impacts the tech could have on the Indian rupee, according to Quartz India. If digital currencies were permitted for use in payments, "whether it will end up destabilising the fiat currency is a major concern for them," said an unnamed representative from the cryptocurrency industry who recently met with the panel.  “The overall impact on the financial ecosystem that it is likely to have is still unclear and it has been a challenge to convince them on this particular point,” they said. Rahul Raj, founder of the Koinex exchange, said in the piece that, with the low level of adoption of cryptos in payments currently, the concerns are "a bit premature."  WHO WON #CRYPTOTWITTER Copyright © 2019 CoinDesk. All rights reserved. Our mailing address is: 250 Park Avenue South New York, NY, 10003, US Want to change how you receive these emails? You can update your preferences or unsubscribe from this list

Dead or alive? 🧐

February 4, 2019

ARCHIVE

QUOTE OF THE DAY

"The bigger thing with bitcoin is not bitcoin itself, but what does that decentralized technology really do?"

- Ashton Kutcher

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MARKET

COIN	PRICE	24H
BTC	$3,451.37	- 0.76%
XRP	$0.301203	- 1.30%
ETH	$107.67	- 0.40%
EOS	$2.40	+ 0.17%
BCH	$119.31	+ 0.54%

*Information as of 10:00 AM EST

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REVIEW

QuadrigaCX 'Lost' $190 Million Bitcoin But it Could Be On the Move

Late last year, Canadian Exchange QuadrigaCX faced an unfortunate event - the passing of its founder Gerald Cotten.

But the trouble didn't stop there. Shortly after, the exchange filed in court saying it owed customers $190 million Bitcoin that they don't have.

That's because Cotten was the only person who had the private key to get into the exchange's offline storage and recover the funds.

Shuffling wallets

If the private key was actually lost, the coins would be locked away forever. However, skeptics are pointing out the possibility that this incident is actually an elaborate exit scam.

One Reddit user studied several major wallets that were associated with QuadrigaCX and found four that were known to be controlled by the exchange.

The user also found that these four addresses have initiated transactions with the exchange fairly recently - something that wouldn't be possible without the lost private key.

Inconclusive, but raises questions

Though these allegations still stand, it's possible the addresses were actually additional hot wallets the exchange owned. This truth would quickly debunk the theory.

Still, other questions are now being raised like whether or not the Bitcoin was secured like the exchange had previously advertised.

For now, though, the investigations with local authorities will continue as the crypto community keeps a close eye on all the associated wallets.

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NEWS

Binance CEO Believes an Amazon Altcoin is in the Future

Over the weekend the popular Binance exchange CEO Changpeng Zhao (CZ) tweeted:

"For any internet (non-physical) based business, I don't understand why anyone would not accept crypto for payments. It is easier, faster and cheaper to integration than traditional payment gateways. Less paperwork. And reaches more diverse demographic and geography."

Later though, in a reply to his original tweet, CZ added:

"Amazon will have to issue a currency sooner or later."

Dabbled in blockchain, less with cryptocurrency

CZ's forecast may hold true, but so far, the company hasn't shown much of an interest.

Back in November the giant released plans for two new blockchain-related products, though the patents had little to do with cryptocurrencies.

Overall, the company has little run-ins with cryptocurrency except for when a spokesman responded to rumors about accepting Bitcoin as a payment:

"(Amazon) opts to include new products or services only when these are useful for our customers - until that point, we do not engage in rough speculation."

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RESEARCH

Tencent Finds Chinese Economists are Divided on Blockchain

In a recent survey, Chinese tech giant Tencent questioned 100 chief economists around the country about blockchain technology.

Upon completion, the findings show one clear trend: blockchain is a dividing topic.

Numbers in a nutshell

Here are the numbers you should know:

• 51% would support a central bank digital currency (CBDC) while 40% would not
• 33% believe blockchain technology is highly important while 51% were neutral or unenthused

Though the numbers show significant support on both sides, the two sides leave no clear direction for blockchain moving forward.

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BITS

But wait, there's more...

• 🇻🇪 A new crypto bill in Venezuela is establishing a legal framework for the industry.
• 🚨 A sim swapping crypto theif was indicted after hacking over 50 different victims.
• 🐦 Twitter CEO Jack Dorsey still believes that Bitcoin will be the internet's currency.

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