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| June 23, 2018

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EOS Decentralization Questioned as Block Producers Freeze Accounts

June 20, 2018 |

EOS Decentralization Questioned as Block Producers Freeze Accounts

On June 17, 2018, the 21 block producers or nodes that run the EOS network chose to freeze seven accounts that were allegedly stolen from EOS community members. According to reports, all 21 block producers unanimously decided to freeze the compromised assets but the decision was met with controversy from the EOS community, and possibly some second thoughts from the block producer EOS New York.

Also Read: Ripple Gateways Can Freeze Users’ Funds at Any Time

EOS Block Producers Unanimously Decide to Freeze Accounts

EOS Decentralization Questioned as Block Producers Freeze AccountsThe decision made by EOS block producers brings a lot of questions to the table again in regard to whether or not a public blockchain that has centralized nodes with freezing powers can truly be considered a permissionless blockchain. On June 17, the 21 EOS block producers (BP) had agreed unanimously to freeze several accounts on the EOS blockchain that were allegedly stolen. According to the BP members and the EOS911 (a system that shows if EOS keys were compromised), malicious actors using phishing attacks and other forms of social engineering were able to steal people’s keys. Seven accounts have been frozen even though there seems to be more complaints of compromised keys to hand.

EOS New York Shows Reluctance

Even though all 21 BPs chose to unanimously vote to freeze these accounts, EOS New York has written that even though they voted on enacting the account blacklist, the organization wavered on the decision.

“EOS New York chose to enact this freeze because we believed that we were following the spirit of the governance system we as a community seek to create, despite it being formally absent. EOS is a platform meant to enable solutions which protect life, liberty, and property and that’s what we believed we were doing through this emergency action,” the New York-based BP noted.

“As of right now, we do not have a timeline for when the freeze action can be lifted or sanctioned by ECAF  Freezing accounts outside of formal processes with no timeline or next steps is not ok,” EOS New York emphasizes. “We have asked for ECAF to submit a formal ruling on the merits of the case by 1300 UTC 19 June 2018. If no such ruling is released by this time, EOS New York will remove the “freeze”, which cannot be enforced without unanimous consensus by all top 21 Block Producers.”

However, EOS New York stated that if this continues to happen they may not be so supportive unless the state of the network was in critical need of the blacklisting solution again.  

We are encountering these problems on a daily basis and we do not have the tools in place to properly address them.

EOS Decentralization Questioned as Block Producers Freeze Accounts

Other Well-Known Chains with the Ability to Freeze Accounts

The decision was controversial among EOS participants and the cryptocurrency community in general to say the least as the topic erupted into debates about centralized chains and immutability once again. Many people are skeptical that a blockchain with centralized nodes with freezing abilities can even be called ‘decentralized’. The third highest valued cryptocurrency network held by Ripple (XRP) has also been accused of the same freezing process multiple times in the past.

EOS Decentralization Questioned as Block Producers Freeze Accounts

Furthermore, the EOS blacklisting took place not long after the network was officially launched last week when the 21 BPs voted to initiate the chain, but then had critical issues with block production shortly after the launch. The EOS chain and concept has been on the hype train ever since its inventor Dan Larimer (also the creator Bitshares and Steemit) announced the protocol, leading to the token’s market capturing the fifth highest market cap.

What do you think about the EOS block producers’ ability to blacklist and freeze accounts? Let us know what you think about this subject in the comment section below.


Images via Pixabay, Disney’s Frozen, the XRP and EOS logo, and Wiki Commons.


Verify and track bitcoin cash transactions on our BCH Block Explorer, the best of its kind anywhere in the world. Also, keep up with your holdings, BCH, and other coins, on our market charts at Satoshi’s Pulse, another original and free service from Bitcoin.com.

The post EOS Decentralization Questioned as Block Producers Freeze Accounts appeared first on Bitcoin News.

Bitcoin News

Despite Court Order Tokyo Exchange Says It’s ‘Technically Difficult’ to Close Accounts

June 15, 2018 |

Despite Court Order Tokyo Exchange Says It’s 'Technically Difficult' to Close Accounts

A court order to freeze assets stored in an account on a cryptocurrency exchange in Tokyo could not be enforced, it was learned on June 13. The exchange said it was ‘technically difficult’ to foreclose the account. A mechanism for freezing accounts on the platform has apparently not been developed yet. Experts urge crypto exchanges to put such a mechanism in place, or people could exploit the flaw to avoid seizure or to hide assets.

Also read: Crypto and Virtual Reality Meet in Ken Liu’s Science Fiction

Tokyo Exchange Can’t Comply with Court Ordered Crypto-Account Closure Due to Technical Difficulties

The regional news outlet Nikkei has reported that a woman in her 70s requested a cryptocurrency account foreclosure. According to her lawyer, Yuko Fujii, the lady got caught in trouble in May 2016, as a trader in Saitama Prefecture convinced her that she could make a profit with virtual currencies. The lady allegedly was advised to purchase cryptocurrencies at 30% above the market price. She purchased the amount of about JPY 500,000 (~US$ 4,525) worth of crypto with JPY 150 million (~$ 1,357,500).

The lady later reconciled with the trader and was being repaid at the purchase price, but suddenly the payment stopped. She then requested the foreclosure of the account under the name of the trader to get the remaining JPY 13 million (~$ 117,650). Her claim was approved and the Saitama District Court ordered the exchange to foreclose the wallet linked to the trader’s ripple account twice, once in July 2017 and the other in April 2018.

But the cryptocurrency exchange replied that the wallet was technically not managed by them and that they could not refund the victim. They added that if they reimbursed the lady on behalf of the wallet company, they would not be able to get refunded by the trader, and they would suffer losses themselves.

Despite Court Order Tokyo Exchange Says It’s 'Technically Difficult' to Close Accounts
The exchange later revealed that it had withdrawn its application to enter the cryptocurrency industry, based on the revised fund settlement law.

Exchange Has Yet to Refund the Victim

As a result, because the wallet of the trader was not foreclosed, there is alleged evidence that the trader had moved his crypto out, and the victim still has not recovered her funds. Fujii, the attorney, commented that if the cryptocurrency exchange did not comply with the court order, the victim could “hardly” be relieved from the damage she suffered.

The cryptocurrency exchange told Nikkei that they consulted an advisory lawyer and recognized that there was a legal problem regarding the payment. “We have not yet refunded the victim,” the exchange’s official replied. The exchange had received a business improvement order from the Fukuoka Financial Office in March and later revealed that it had withdrawn its application to enter the cryptocurrency industry based on the revised fund settlement law.

Professor Masashi Nakajima, a financial expert familiar with crypto, said that a cryptocurrency that doesn’t have an administrator cannot be seized by a public authority. It is also impossible to technically guarantee a secure execution of the refund. This practice could become the hotbed for money laundering and concealment if not tackled properly.

What do you think about the Tokyo exchange that couldn’t comply with a court order to close an account due to technical difficulties? Let us know your thoughts on this subject in the comments below.


Images via Shutterstock and Pixabay. 


Verify and track bitcoin cash transactions on our BCH Block Explorer, the best of its kind anywhere in the world. Also, keep up with your holdings, BCH and other coins, on our market charts at Satoshi’s Pulse, another original and free service from Bitcoin.com.

The post Despite Court Order Tokyo Exchange Says It’s ‘Technically Difficult’ to Close Accounts appeared first on Bitcoin News.

Bitcoin News

Venezuela Begins Monitoring Bank Accounts for Crypto Transactions

June 15, 2018 |

Venezuela Begins Monitoring Bank Accounts for Crypto Transactions

The government of Venezuela has started monitoring the bank accounts of its citizens for cryptocurrency-related transactions. Accounts found to contain crypto transactions at prices which the government considers to be “undermining the national currency” will be “severely punished,” Vice President Tareck El Aissami said.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Next Phase of Operation Paper Hands

Following the launch of “Operation Paper Hands,” as news.Bitcoin.com previously reported, the Venezuelan government has initiated the next phase of its plan to reduce capital flight, calling it “Operation Metal Hands.”

Venezuela Begins Monitoring Bank Accounts for Crypto Transactions
Tareck El Aissami.

This new phase was launched last week with a focus on what they call “gold smugglers,” or Venezuelans who bought gold from small miners and then sold it outside of the country. The operation has “detected that these mafias have distorted the prices of the dollar,” the country’s Vice President Tareck El Aissami declared, adding that “they have migrated through the market of cryptocurrencies to hit the Venezuelan monetary system.”

The operation further targets capital flight via cryptocurrencies. El Aissami explained that the government will start monitoring bank accounts for crypto-related transactions and will prosecute those trading them “at speculative prices.”

“This is part of a war to hit the financial system of the country,” Aporrea publication stated, “and they [the government] will exercise future actions to hit those who try to conspire through cryptocurrencies.” The Vice President was quoted by La Red publication:

All the accounts that we identify that are linked to the manipulation are going to be severely punished and (those responsible will be) placed at the order of justice.

He revealed that, as part of Operation Paper Hands, “5 billion bolivares [~US$ 50,000] in bank accounts were frozen at Banesco bank, and 12 trillion bolivares [~$ 120 million] were seized that were destined for contraband in Colombia,” Aporrea publication conveyed.

Three Remittance Houses Legalized

Venezuela Begins Monitoring Bank Accounts for Crypto TransactionsSince the launch of Operation Paper Hands, three remittance houses were shut down, including two crypto exchange operators. However, the government soon realized that underground cryptocurrency transactions did not cease.

This led the Vice President to announce last week that three money exchangers in Caracas have been specifically authorized to handle the country’s foreign exchange transactions and remittances. He was quoted by Correo Del Orinoco:

We have authorized three exchange houses, private companies, private exchange operators, legally authorized, to perform all operations associated with remittances.

The three exchanges are Zoom, Italcambio, and Insular. However, their websites do not indicate that they deal with cryptocurrencies in any way.

For the purpose of buying and selling cryptocurrency specifically, the Venezuelan president, Nicolas Maduro, announced in April that he had certified 16 exchanges with the aim for them to list his country’s own digital currency, the petro.

What do you think of Venezuela monitoring bank accounts for crypto transactions? Let us know in the comments section below.


Images courtesy of Shutterstock and Wikipedia.


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The post Venezuela Begins Monitoring Bank Accounts for Crypto Transactions appeared first on Bitcoin News.

Bitcoin News

Regulator found 20,000 bad accounts at major banks. We still don’t know which ones

June 13, 2018 |

The nation’s top bank regulator told members of Congress on Wednesday that his agency found about 20,000 accounts that may have been opened without customers’ authorization or had other problems during a review of the nation’s largest financial institutions prompted by the Wells Fargo & Co. scandal.


L.A. Times – Business

Regulator to face questions over unauthorized accounts in banking industry

June 13, 2018 |

The nation’s top bank regulator has found evidence that institutions other than Wells Fargo & Co. may have created accounts without customers’ authorization — and a prominent Democrat wants the regulator to name names.

Ohio Sen. Sherrod Brown, the ranking Democrat on the Senate banking committee,…


L.A. Times – Business

Wells Fargo not the only bank to have created unauthorized accounts — but regulator won’t identify others

June 9, 2018 |

A federal bank regulator that has fined Wells Fargo more than $ 500 million over its creation of unauthorized accounts and other consumer abuses has found evidence of sales practice problems at other large and midsize banks — but is refusing to name those institutions.

The Office of the Comptroller…


L.A. Times – Business

Switzerland Shows the Way: Bank First to Offer Crypto Business Accounts

June 9, 2018 |

Switzerland Shows the Way: Bank First to Offer Crypto Business Accounts

Switzerland’s legacy bank, Hypothekarbank Lenzburg, announced this week it was accepting cryptocurrency related businesses as account holders, something many legacy financial institutions outright refuse. Long viewed as a progressive society way ahead of its time, the Swiss are once again leading, … this time it’s doing so in the crypto revolution.

Also read: Fidelity Investments Hints at Entering Cryptocurrency Exchange Space

150 Year Old Bank in Switzerland Opens to Crypto Businesses

Switzerland’s mortgage bank Hypothekarbank Lenzburg CEO Marianne Wildi explained, “As a bank that sets itself up technologically and pursues a cooperative strategy in the field of fintech, it is also a matter of credibility to work together with the young sector of crypto and blockchain companies in Switzerland.” Its earliest iteration can be traced back 150 years, and has since morphed into a mortgage, retail, and a private banking services provider, acting locally while being publicly listed.

Switzerland Shows the Way: Bank First to Offer Crypto Business Accounts
Hypothekarbank Lenzburg CEO Marianne Wildi

The Swiss were among the earliest to really see crypto’s potential, becoming a mecca for those interested in the technology and incubating startups along the way. As a rival to the US’s Silicon Valley, an area in Zug has been deemed Crypto Valley for its broad enthusiasm of the phenomenon. Even so, in announcing its new policy Hypothekarbank Lenzburg is the country’s first bank to welcome crypto businesses.

Regional media quoted Ms. Wildi as explaining how much thought went into changing their policy, suggesting guidance came from the country’s relatively permissive regulator, the Financial Market Supervisory Authority (FINMA). In perhaps in an effort to assuage board members’ fears, she also was sure to the extensive vetting that goes into accepting crypto businesses as clients.

Could be a Trend

Prior to Hypothekarbank going all in, the financial community dabbled along the edges of crypto-related business support. Falcon Private Bank, for example, made headlines last year by vaguely interacting with “crypto asset management.” Bank Frick of Liechtenstein continues to offer to its customers cold storage and top coin access such as bitcoin cash, bitcoin core, litecoin, ether, and ripple.Switzerland Shows the Way: Bank First to Offer Crypto Business Accounts

Ms. Wildi elaborated on just how their new police would shake out, more or less handing over the task to contractor Geissbühler, Weber & Partner AG. “They already have a lot of cryptographic know-how and analyze customer inquiries about the legal consequences and backgrounds,” she assured. “After due diligence they give us a recommendation, and the decision then follows. It’s true that the customer review process is more involved in such relationships, but it does not make any difference to other customer relationships insofar as compliance processes have to work flawlessly anyway.”

Do you think more countries will follow Switzerland’s lead? Let us know in the comments. 


Images via the Pixabay.


Verify and track bitcoin cash transactions on our BCH Block Explorer, the best of its kind anywhere in the world. Also, keep up with your holdings, BCH and other coins, on our market charts at Satoshi’s Pulse, another original and free service from Bitcoin.com.

The post Switzerland Shows the Way: Bank First to Offer Crypto Business Accounts appeared first on Bitcoin News.

Bitcoin News

Judge approves a $142-million settlement over the Wells Fargo accounts scandal, calling it ‘rough justice’

May 30, 2018 |

Wells Fargo & Co. customers who didn’t consent to having 3.5 million accounts created by bankers trying to hit sales quotas are finally getting what amounts to an “imperfect solution.”

U.S. District Judge Vince Chhabria agreed Wednesday to issue final approval for a $ 142-million class-action accord…


L.A. Times – Business

Bitcoin in Brief Monday: Poloniex Responds to Frozen Accounts Complaints

May 28, 2018 |

Bitcoin in Brief Monday: Poloniex Responds to Frozen Accounts Complaints

In today’s edition of Bitcoin in Brief we feature stories that show the increased focus regulators have placed on companies operating in the cryptocurrency scene and how it can adversely affect clients. FCA revels it is investigating dozens of ventures, and Poloniex tries to reassure legacy clients that their frozen funds are safe.

Also Read: Niall Ferguson Tells Bank of England Bitcoin Is Financial System of the Future

Poloniex Responds to Complaints

Poloniex, the cryptocurrency trading platform which was taken over by Circle earlier this year, has finally responded to complaints by its clients about frozen accounts. Stories of legacy accounts getting locked have flooded social media and cryptocurrency forums over the last week. The company now tries to reassure these clients their funds are safe and explain the matter is required by law.

“As soon as you submit this information, we will take steps to verify it and re-enable trading and transactions for your account. Please rest assured that your funds remain safe and accounted for while you complete this process – you can verify your holdings on the Balances page of your account throughout. Like all registered money services businesses, Poloniex is committed to compliance with all applicable law requiring identification and verification of its customers.”

The company also claims to have taken steps to increase the speed of the process. “We are happy to report that in the past 3 months we’ve seen a 33% increase in customers who are instantly verified, a 77% increase in customers who successfully pass our verification process, and an 85% decrease in customer waiting time for verification.”

24 Crypto Ventures Under FCA Investigation

Bitcoin in Brief Monday: Poloniex Responds to Frozen Accounts ComplaintsTraders that are used to how things were before regulators started focusing on crypto platforms are understandably angry about the new hoops they have to jump to, but there is no doubt that the companies are under scrutiny and pressure to do so from regulators.

The UK’s Financial Conduct Authority (FCA) has revealed it is currently investigating two dozen unauthorized cryptocurrency-related ventures and has also opened seven whistle-blower reports in 2018 alone related to companies operating in this field, according to FT. Responding to a freedom of information request from accountancy and consulting firm Moore Stephens, the FCA said on Friday that the purpose of the investigation is to determine whether these crypto companies might “be carrying on regulated activities that require FCA authorization”.

ICO Marketing Tragedy

Ask.fm, an Irish company with its base of operations in Latvia and Ukraine, has sponsored four cryptocurrency enthusiasts to climb Mount Everest and place a wallet at the summit as part of its ICO marketing campaign. Lama Babu Sherpa, one of the Nepalese natives who helped the climbers, has reportedly been missing since May 14th and is now presumed dead, according to AFP.

The team responded on Saturday: “We are now aware that one of the Sherpas who assisted our group amongst others, went missing during the descent. We wish to clarify conflicting media reports by stating that at the time of this statement being made we have not had any response from the relevant officials confirming the status of the missing Sherpa, and we are not therefore in a position to confirm if he is safe or otherwise. It would be insensitive to make such assumptions and we await, and urge the media to await, confirmation from the relevant authorities. There is no doubt that climbing Everest is challenging and dangerous…The last official update we received was that the condition and location of the missing Sherpa was unknown and it was not our place to make public statements which could have resulted in false information being circulated.”

Crypto Champion

And lastly, some happy news. Rory MacDonald, the current Bellator MMA Welterweight World Champion, has shared a clip of himself training in a BCH shirt showing support for bitcoin cash to his hundreds of thousands of followers on social media.

What do you think about today’s news updates? Share your thoughts in the comments section below. 


Images courtesy of Shutterstock.


Do you agree with us that Bitcoin is the best invention since sliced bread? Thought so. That’s why we are building this online universe revolving around anything and everything Bitcoin. We have a store. And a forum. And a casino, a pool and real-time price statistics.

The post Bitcoin in Brief Monday: Poloniex Responds to Frozen Accounts Complaints appeared first on Bitcoin News.

Bitcoin News

Chilean Bank Reopens Accounts of Cryptocurrency Exchanges

May 28, 2018 |

Chilean Bank Reopens Accounts of Cryptocurrency Exchanges

Following the court order for three major banks in Chile to reopen current accounts of crypto exchanges, Cryptomkt and Buda.com, one bank has complied. Bancoestado has reportedly made arrangements to open an account for Cryptomkt exchange, which expects to resume cryptocurrency transactions in the coming days.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Bank Reopens Crypto Accounts

Chilean Bank Reopens Accounts of Cryptocurrency ExchangesBancoestado, the only public bank in Chile, on Thursday “finalized the first [re]opening of a current account for Cryptomkt, as confirmed by Martín Jofré, founding partner of the cryptocurrency platform,” La Tercera reported.

The move follows the order by Chile’s Tribunal for the Defense of Free Competition (TDLC) in April for three of the country’s largest banks to reopen the accounts of two crypto exchanges. Bancoestado, Scotiabank, and Itaú were all ordered to reopen bank accounts of Cryptomkt and Buda.com.

Itaú is a subsidiary of Brazilian bank Itaú Unibanc; Scotiabank Chile is the Chilean unit of Canada’s Scotiabank. Following the court’s order, they appealed the decision, but the court rejected the appeal and confirmed that they must reopen the bank accounts of the two crypto exchanges while the case is still pending.

Chilean Bank Reopens Accounts of Cryptocurrency ExchangesAccording to Jofré, when the banks announced the closing of his exchange’s accounts, “in five days they returned 99.8% of the funds to the clients of Cryptomkt, so now they will start from scratch,” the publication described.

Nonetheless, Diario Financiero reported that the exchange “expects to resume the digital currency transaction market in Chile in the coming days.”

Banks Appealing to Court

Chilean Bank Reopens Accounts of Cryptocurrency ExchangesWhile Bancoestado has reportedly been in contact with Cryptomkt to reopen the exchange’s bank account, Scotiabank and Itaú are expected to “appeal to the precautionary measure approved by the TDLC,” the news outlet detailed.

Buda.com has not confirmed that its bank account will be reopened. The legal manager of the exchange, Samuel Cañas, indicated after the court’s decision early this month that they will continue to “completely discredit the accusations presented by the banks in their brief, Chilean Bank Reopens Accounts of Cryptocurrency Exchangeswhich demonstrate a serious ignorance of our business and the economic institutions that support our activity,” MSN reported.

On Friday, La Tercera quoted Bravo law firm explaining that the only recourse the banks have is to take the case to the supreme court. However, “even if that happens, they must make effective the reopening [of crypto exchanges’ bank accounts] ordered by the TDLC,” the news outlet emphasized.

Do you think banks will find a way to close accounts of crypto exchanges again? Let us know in the comments section below.


Images courtesy of Shutterstock, Itau, Bancoestado, and Scotiabank.


Need to calculate your bitcoin holdings? Check our tools section.

The post Chilean Bank Reopens Accounts of Cryptocurrency Exchanges appeared first on Bitcoin News.

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