Tether Blacklists, Dogecoin Goes Viral and Coinbase May Go Public — Crypto News of the Week
Crazy Ethereum Fees, a Bitcoin ETP and Calls for a Crypto Ban in India: Crypto News of the Week
It was an eventful week in the crypto world — with one whale spending millions to send Ethereum (ETH), reports of a new crypto ban proposal in India and a new Bitcoin exchange-traded product (ETP) set to hit the market, among other topics.
Ethereum whale paid $5.2 million in transaction fees
Two illogical transactions of ether took place this week that cost a whopping $5.2 million in transaction fees to move only 350.55 ETH — currently worth roughly $82,799.91.
The first transaction took place on June 10 and moved a mere 0.55 ETH for a fee of 10,666 ETH. The absurdly large fee — a normal fee would be well under $1.00 — went to Shark Pool, a Chinese mining pool.
The apparent mistake was made again the next day when the same Ethereum address transacted an additional 350 ether for a transaction fee of 10,668 ether. The Ethermine mining pool was the beneficiary of this second fee.
- The reason for the irrationally-high fee is not yet known, but it has been presumed by some to be either a mistake or an attempt at laundering money.
- Because the Ethereum network is decentralized, there is no way for the sender or any third-party to reverse these transactions. Hence why many in the cryptocurrency community stress the importance of sweating the details and “being your own bank.”
Microsoft launches decentralized identity network beta on Bitcoin
Identity Overlay Network (ION), a decentralized identity network from Microsoft on the Bitcoin network, has launched the beta version of its open-sourced, layer-two project — which looks to replace usernames with decentralized identifiers (DIDs).
ION would essentially allow for user-controlled logins that don’t require system-providers (such as social media companies) to maintain ownership of an individual’s credentials.
First announced last year, ION is meant to enable user-controlled logins that suit independent companies or services, rather than having system-providers (like Facebook) owning a user’s login credentials. ION can be used for many use cases that aren’t strictly related to health certificates or contact tracing, though the continued spread of coronavirus has influenced its potential usage.
- The rapid development of ION has been spurred on by the COVID-19 pandemic. However, not everyone is confident in ION’s and other similar projects’ privacy-safeguarding measures.
- Microsoft has been active in its blockchain technology development recently, announcing a new Azure Blockchain Service and Azure Blockchain Development Kit for the Ethereum blockchain.
Cryptocurrency exchange QuadrigaCX operated like a Ponzi scheme
Notorious and now-defunct cryptocurrency exchange QuadrigaCX — which went bankrupt after founder and CEO Gerland Cotten reportedly died while abroad — operated as a Ponzi scheme, according to a recently-made-public report from the Ontario Securities Commission (OSC).
The report most notably alleges that Cotten traded against QuadrigaCX’s customers and used fake trading accounts on other cryptocurrency exchanges funded by QuadrigaCX customers’ deposits. As the report explains:
“Cotten opened Quadriga accounts under aliases and credited himself with fictitious currency and crypto asset balances which he traded with unsuspecting Quadriga clients. He sustained real losses when the price of crypto assets changed, thereby creating a shortfall in assets to satisfy client withdrawals.”
- The QuadrigaCX saga continues to serve as a prime example of wrongdoing and financial crime present in the still-maturing blockchain and cryptocurrency industry.
- Major exchanges with verifiable credentials and a long history of security remain the safest options for trading cryptocurrencies.
Bitcoin ETP set to launch on German digital stock exchange Xetra
Germany’s Xetra digital stock exchange will receive its first crypto ETP later this month. The ETP comes from the London-based ETC Group and will be available for customers in the United Kingdom, Italy and Austria.
According to ETF Stream, the BTCetc Bitcoin Exchange Traded Crypto (BTCE) will be physically-backed, track the price of Bitcoin and have a total expense ratio (TER) of two percent.
- We have seen a steady increase in institutional investment in the first and foremost cryptocurrency, alongside an increase in Bitcoin products for said investors.
- As yet another Bitcoin product geared towards institutional investors, the new ETP removes the technical challenges associated with BTC — such as managing wallet addresses and security.
Indian Ministry of Finance proposes ban on cryptocurrencies
Three months after the Supreme Court of India superseded the Reserve Bank of India’s (RBI) ban on banks servicing individuals and entities dealing in cryptocurrencies, the Indian Ministry of Finance has proposed a blanket ban on cryptocurrencies.
The Indian parliament will review the proposal after it has been forwarded to the Union Council of Ministers.
- This is not the first time a blanket ban on crypto has been proposed in India. Previous proposals have thus far not been successful in banning the new asset class.
- A crypto ban in the second-most populous country would be a major blow for global cryptocurrency adoption.