Coinbase Criticism / Woz Interview / Empty Blocks / Roger Ver Investment

Subscribe | View in browser $BTC (1:42 p.m. EST): $3,85.65 (-0.03%) // 90-day high: $6,286.41 // 90-day low: $3,286.14 / / More… $BCH ABC (1:42 p.m. EST): $133.82 (-0.25%) // 90-day high: $432.88// 90-day low: $80.95 // More… $ETH (1:43 p.m. EST): $138.16 (0.82%) // 90-day high: $201.35 // 90-day low: $86.08 // More… $LTC (1:43 p.m. EST): $45.40 (0.28%) // 90-day high: $49.19 // 90-day low: $22.09 // More… $XRP (1:43 p.m. EST): $0.31 (-1.15%) // 90-day high: $0.52 // 90-day low: $0.28 // More…       1. Members of the cryptocurrency community have criticized Coinbase for its acquisition of Neutrino because of its founders ties to an infamous Italian surveillance company. Neutrino's CEO, CTO and chief research officer, were also leaders at Hacking Group, which was caught several times selling spyware to governments with questionable human rights records, such as Ethiopia, Saudi Arabia, and Sudan. Francis Pouliot, co-founder of Bull Bitcoin, said Hacking Team was "a pro-government mercenary hacker firm that gave Saudis tools/consulting to track/eliminate dissidents," adding, "run!" Coinbase said it "does not condone nor will it defend" the founders' previous actions. –VICE       2. Apple co-founder Steve Wozniak said bitcoin has seen "massive value creation" during a wide-ranging interview with Bloomberg. Wozniak, a co-founder of the blockchain-focused venture fund, EQUI Global, refuted the reporters statement that bitcoin has seen a large loss of value. Wozniak said he largely ignores the price of bitcoin as psychology can drive market dips. He said he sold all of his bitcoin last year at the height of its price, a statement he has made before. –COIN TELEGRAPH       Ad What's new in the entirely reimagined Jira Software? Just about everything. The next generation of Jira has arrived, featuring new roadmaps, more flexible boards, an overhauled configuration experience, and dozens of new integrations. And that's just the beginning. See what you're missing in the entirely reimagined Jira Software. Simpler and more powerful than ever before.      3. Bitcoin miners for ethereum, bitcoin cash, zcash, and litecoin have received millions of dollars over the past year for mining empty or "lite" blocks, according to the latest issue of Diar. The publication states these miners have been paid for "doing nothing," but that is not quite the case. These chains sometime feature empty blocks because of low use. The miners confirm and secure the blocks, receiving a reward for their trouble. Of course, the reward is small but it requires little work. Diar reports that miners receive on average about $5 million on each chain every month. Ethereum actually hast the most open blocks and paid miners $65 million in 2017 to mine them. –DIAR       4. The Pangea Blockchain Fund closed a $22 million seed round that included investment from Bitcoin.com CEO Roger Ver. Based in Switzerland, Pangea plans to invest in "transformative" blockchain startups around the world. The goal is to find companies with commercial industrial applications for blockchain. The fund has no plans to direct invest in cryptocurrency. The round also included investment from Copernicus Asset Management, a Swiss firm that is regulated by the country's Financial Market Supervisory Authority. –COINDESK       Ad Engineers Build Business with GitPrime Ship faster because you know more, not because you're rushing. GitPrime aggregates historical git data into easy to understand insights and reports, to help make engineering teams more successful. Debug your development process with objective data. Get started today. 5. With just two days left in the month bitcoin is on pace to end its six-month losing stream. The coin is trading about 10 percent higher now since the beginning of the month. If this price holds, bitcoin will have been in the green in February for the fifth consecutive year. –COINDESK                                          6. Tron CEO Justin Sun told Chinese cryptocurrency outlet Huoxing24 (English translation) that he believes bitcoin has reached its bottom but he is not optimistic a near-term breakout is coming. –ETHEREUMWORLD NEWS 7. Café Cryptoria plans to open next month in Las Vegas where customers can pay for their meal with bitcoin or ethereum. –EATER 8. Florida lawmakers introduced legislation that would create a working group to study practical uses for blockchain technology. –GOVERNMENT TECHNOLOGY 9. The Litecoin Foundation announced another fight-related partnership, this time with Glory Kickboxing. The foundation recently became a sponsor for the UFC, as well. –THE BODY LOCK MMA 10. Days after launching liquiding indices for bitcoin and ethereum, Nasdaq is in the final stages of doing the same for Ripple's XRP. –CRYPTO SLATE Correction: Yesterday we made two silly errors in our newsletter. Bitcoin transacted $1.3 trillion in volume, not $1.3 billion. Also, the largest bitcoin investors hold 2.29 million BTC coins, not 2.29 billion. I am sorry for the errors.       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: Kim Lyons (managing editor at Inside, a Pittsburgh-based journalist with recent bylines in the NYTimes and Columbia Journalism Review.) and Susmita Baral (senior editor at Inside, recent bylines in NatGeo, Teen Vogue, and Quartz. Runs the biggest mac and cheese account on Instagram).       Ad A reimagined Jira Software. Simpler and more powerful than ever before. 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February 27, 2019 FAKE DUDES: BHB, a crypto project based in China, raised $20 million through a rewards-based marketing scheme, promising token holders dividends (in the form of tether stablecoins) and extra perks if they signed up others. But signs have emerged that something is amiss. An investigation by CoinDesk's Wolfie Zhao found that of the three team members touted on the project's website, at least two were totally fake, their photos lifted from real-life professors who publicly deny any involvement with BHB. And that's not the half of it. From the project's similarity to multi-level marketing and pyramid schemes (the latter of which is illegal in China) to a member gala with lucky draws for luxury cars, this story from the Far East is straight-up Wild West. Full story FIDELITY ON BOARD: Blockchain analytics startup Coin Metrics has closed a $1.9 million seed round with Fidelity Investments, Highland Capital Partners and Dragonfly Capital. Announced today, the startup also released its first suite of commercial products for institutions seeking customized research reports. Coin Metrics co-founder and board chairman Nic Carter told CoinDesk that institutional investors aren’t satisfied with the current crop of price aggregation services that don’t distinguish the integrity of different data sets. “One thing we’re looking at is building out whitelists of exchanges so that the market reference rates are actually based on credible exchanges, as opposed to exchanges that engage in wash trading and other types of nonsense,” Carter said. Coin Metrics also analyzes blockchain data with a methodology that aims to help traders cut through the noise, as Carter put it. For example, purchasing bitcoin on an exchange platform might lead to hops across wallets in the platform’s back-end storage. Failing to account for such patterns could artificially inflate transaction data. “Not all of this is meaningful and economic, only a fraction of this is,” Carter said of the importance of correctly mapping patterns of activity on the blockchain. Full story COMPLIANT TOKENS: Token platform Polymath says its tests have shown how security tokens can be traded on a decentralized exchange without violating regulations. Revealing the news exclusively to CoinDesk on Wednesday, Polymath said that the “successful” test trades – which used smart contracts on Loopring’s DEX protocol – demonstrated that only authorized trades of security tokens based on its ST-20 standard were able to execute, while unauthorized trades could not. Detailing how it works, Polymath said that every time a trade is attempted, the token calls its transfer manager module and effectively asks, “Can this trade be executed?” The transfer manager then checks a whitelist (controlled by the token issuer) to see if the buyer and the seller are allowed to trade the token. Only if the answer is yes is the trade executed. Polymath vice president for marketing Graeme Moore told CoinDesk that the two firms carried out the tests to demonstrate that security tokens can be traded in a compliant manner, even on decentralized exchanges. Full story TURBULENCE AHEAD: Ether price volatility could spike in the days ahead, courtesy of an upcoming ethereum upgrade scheduled for Thursday. The Constantinople hard fork, a planned two-part upgrade to the world’s second-largest cryptocurrency, is scheduled to occur once block 7,280,000 on the ethereum blockchain is mined. At the time of writing, ether’s block height is 7,272,826, meaning the fork should occur in the next 24 to 48 hours, given that roughly 4,200 blocks have been mined per day for the past two weeks. However, the change could draw the interest of more than just developers and users, as historical data shows ether price volatility tends to spike hours before a software upgrade. For instance, ether price volatility picked up with the Byzantium hard fork release on Oct. 16, 2017, with the resulting uncertainty prompting traders to sell ETH and unwind their long positions leading to a 20 percent price slide. Full story THREE IN ONE: Capital markets blockchain startup Nivaura has raised a total of $20 million with the closing of its second seed extension round led by the London Stock Exchange Group (LSEG). Announced today, other investors in the latest round include Santander InnoVentures, Transamerica Ventures, Digital Currency Group and more. Nivaura closed the original seed round in October 2017 and the first extension round in January 2018. The firm did not provide a breakdown of the three rounds but said the latest was “significantly larger than the preceding two.” The proceeds will be used to increase headcount “significantly across all areas” (including hires in machine learning and natural language processing), to expand into the U.S. and Asia, and invest in further R&D, the firm said. The company’s big idea is providing platforms to automate the entire life cycle for the issuance of financial instruments – bonds, equities, derivatives – and leveraging public blockchains for registration and settlement so that humans don’t need to touch anything and a corporate can do a self-service issuance. Nivaura CEO Dr. Avtar Sehra said that this year, Nivaura plans “a series of high-profile, large-scale projects with high-caliber partners to demonstrate our platform as a valuable solution across the full spectrum of capital markets primary issuance activities.” Full story RELIEF: Bitcoin appears on track to snap its six-month losing streak with a close in the green for February. While the cryptocurrency has pulled back from recent highs above $4,100, a convincing move below $3,714 is needed to invalidate the bullish setup. Watch out in March for a strong bounce from the ascending 10-candle moving average on the three-day chart, as that could recharge engines for a move to $4,000. Full story BEST OF THE BEST   BLOOMBERG: Apple co-founder Steve Wozniak defends bitcoin in a video chat with Bloomberg Markets and Finance. The presenter asked if he still believes bitcoin would still become “the world’s single currency” in the future, since it has caused “massive value destruction.” Woz replied: “I’m not sure I can buy that we’ve seen massive value destruction, I think we’ve seen massive value creation.” He also said that, while he has owned bitcoin, it was more to experiment with the technology and not as an investment. “I don’t want to be one of those people watching the price of bitcoin, so I sold out,” he said. THE REST IBM NEWSROOM: Cybercriminals are increasingly turning to “cryptojacking” attacks – illicit mining of cryptos using victims’ computers – seeking greater return on investment, according to IBM Security’s annual 2019 IBM X-Force Threat Intelligence Index. IBM X-Force found that the number of cryptojacking attacks was nearly double that of ransomware attacks in 2018. Cybercriminals were also seen altering their stealth techniques against increased security measures and awareness. "One of the hottest commodities is computing power tied to the emergence of cryptocurrencies. This has led to corporate networks and consumer devices being secretly highjacked to mine for these digital currencies," Wendi Whitmore, global lead of IBM X-Force Incident Response and Intelligence Services (IRIS) said. CHEDDAR: Image-authentication startup Truepic is using technologies including blockchain to help fight fake news, according to an interview from Cheddar. The firm's technology aims to prove whether an image or video was genuine when created and uses blockchain to "create immutability of that image and video," Mounir Ibrahim, Truepic's VP of strategic initiatives, told the news source. "When any image taken at any time is on any social media feed, our technology will be able to access the veracity of that," he said. 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

Neutrino's dark past 😱

February 27, 2019

ARCHIVE

QUOTE OF THE DAY

"If 1% of all Gold holders bought bitcoin, you'd see a bitcoin price of over a million dollars per coin."

- Charlie Shrem

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MARKET

COIN	PRICE	24H
BTC	$3,861.82	+ 0.07%
ETH	$139.11	+ 0.87%
XRP	$0.318247	- 1.04%
EOS	$3.49	+ 0.79%
LTC	$45.55	- 0.20%

*Information as of 10:30 AM EST

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REVIEW

Coinbase Responds to Community Backlash About its Recent Neutrino Acquisition

On February 19th, Coinbase and blockchain security analysis startup Neutrino inked an acquisition deal that would bring the startup's team under Coinbase's wing.

Quickly, however, the community shamed Coinbase.

That's because the CEO, CRO, and CTO of Neutrino were previously executives of the spyware firm Hacking Team - a company that was exposed for selling tools to authoritarian governments.

Against the purpose of crypto?

The problem arises when people realized the tools Hacking Team sold were allegedly being used to:

• Monitor journalists
• Capture activists
• Spy on political rivals

In some cases, the technology was used "to commit violations of human rights and freedom of information," according to Reporters Without Borders.

For many, these morals go against the core promise of cryptocurrency and the important idea of decentralized power.

We're aware and don't care

Now, after days of harsh criticism, Coinbase responded to the concerns in a statement sent to The Block:

"[We are] aware that Neutrino's co-founders previously worked at Hacking Team, which we reviewed as part of our security, technical, and hiring diligence. Coinbase does not condone nor will it defend the actions of Hacking Team [but] it was important for Coinbase to bring this function in-house to fully control and protect our customers' data and Neutrino's technology was the best we encountered in the space to achieve this goal."

For now, Neutrino will continue operating independently, under the same brand, in Coinbase's London office.

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TRADING

Bitcoin Could Snap its Six-Month Losing Streak

Fingers crossed. There is 1 day left in the month and if Bitcoin can stay above $3,467, it will snap its six-month losing streak that started with a tumble below the $6,000 mark.

Actually, this losing streak is the longest on record. Each month's loss varied but the overall bear trend remained strong:

August	- 9%
September	- 6%
October	- 4.4%
November	- 37%
December	- 7%
January	- 7.5%

Before this losing streak, the previous record happened in 2011 when the asset lost value 5 months in a row. It then took 7 years to break that record.

Bullish in March?

We're not going to jinx it or give any random price predictions, but let's just say it can't *not* be good to snap a losing streak for a fresh new month.

But don't get your hopes too high, Bitcoin has lost value 6 out of 7 times in the month of March during the last 7 years.

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EXCHANGE

Hacked Cryptopia Exchange Releases Details After Weeks of Silence

In a series of tweets sent Wednesday, New Zealand-based exchange Cryptopia released some details about its most recent hack.

"Currently, we have calculated that worst case 9.4% of our total holdings was stolen," the account revealed.

Previously, that amount was estimated by blockchain analytics firm Elementus to be around $16 million worth of Ether and ERC-20 tokens.

So when's the comeback?

It's not clear when the comeback for Cryptopia will be, however, the exchange reported it is "securing each wallet individually to ensure the exchange is fully secure when we resume trading."

In addition, the exchange warned users to "immediately refrain from depositing funds into old Cryptopia addresses."

The account left followers saying that more updates will come tomorrow. To follow them on Twitter for the live updates, visit here.

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BITS

But wait, there's more...

• 😃 Apple co-founder Steve Wozniak says we've already seen "massive value creation" from Bitcoin.
• 💰 The London Stock Exchange is leading a $20 million fundraise for blockchain startup Nivaura.
• 🔥 LinkedIn's founder becomes latest to carry the lightning torch.

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MEME

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