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  • Choosing the Most Secure Crypto Exchange, Explained

    Choosing the Most Secure Crypto Exchange, Explained

    Why can’t I just trust the exchanges?

    Although it might be tempting to go for the crypto exchange which makes the best claims or looks the most credible – it’s important to do your own homework.

    31 crypto exchanges have been hacked over the past eight years – with an estimated $1.3 billion stolen.

    You may think that some of the largest exchanges by trading volume – with Binance dominating CoinMarketCap’s rankings – would be among the industry’s most robust given their popularity among crypto enthusiasts. However, as Cointelegraph reported when ICORating’s report was released at the start of October 2018, Binance scored a surprisingly low 63/100 when ranked on requirements including coding robustness and end user protection.

    The report revealed a shocking 41 percent of the 100 exchanges it scrutinized allow “simple” passwords which are fewer than eight characters long – meaning these platforms are enabling less-informed customers to potentially sleepwalk into a calamitous breach where their funds could disappear.

    Overall, its conclusions make for grim reading, with the report’s authors writing: “Nobody is fully protected from the loss of their crypto assets, therefore, invest in reliable assets, diversify your portfolio and choose good crypto exchanges.”

    How do I choose a good exchange? What do the experts say?

    The type of storage the exchange uses, and only keeping your coins in an internet-enabled wallet when you need to use them, matters.

    Firstly, it’s worth learning from the hard lessons that crypto enthusiasts have endured through some of the major hacks of yesteryear.

    Mt. Gox was hacked twice – once in 2011 and again in 2014 – with a total of 850,000 Bitcoin lost in the latter attack. At the time, it represented roughly 7 percent of the total amount of Bitcoin in circulation, with a value back then of about $480 million. Today that would be worth more than $5.4 billion. In 2013, it was handling an estimated 80 percent of Bitcoin transactions – showing how even the largest exchanges can be vulnerable. In Mt. Gox’s case, a faulty computer system was to blame, opening it up to hack attacks.

    Speaking to Cointelegraph back in August, experts said the best way for investors to inoculate themselves against poor security was to choose an exchange which enlists the help of reliable auditors who spend their time looking for flaws in a system. Looking for an exchange which uses cold storage – where assets are stored in a place without an internet connection – can help. Minimizing the amount of coins held in hot wallets can also reduce the impact if an attack does take place.

    What steps can I take?

    Make your password complex and make sure there are multiple steps before a transaction is fully completed.

    Several exchanges use a time delay when they are processing transactions, enabling them to be manually reviewed for fraudulent activity. Although it can be slightly inconvenient to wait for funds to clear, experts say most users should be willing to withstand the inconvenience of waiting for a payment instead of losing their assets because they were processed instantly and unwittingly handed to a greedy hacker.

    It’s important to embrace the layers of security that an exchange offers, as well as the warning triggers that come into place when a transaction looks suspect. This means making the most out of two-factor authentication, multi-signature transactions, and ensuring that a password is as complex as humanly possible.

    What are crypto exchanges doing to ramp up security?

    Platforms most conscious about security are trying to ensure that any and all transactions purported to be by you match up.

    This can mean verifying that the IP address which is being used to complete transactions match up with the details that you normally use. Verifying payments with an email confirmation is also commonplace, as well as using a crypto debit card. This particular tool is advantageous because you’ll normally have it on your person, making it harder for funds to be stolen in isolation from halfway around the world.

    Some crypto exchanges, like International Digital Currency Markets (IDCM) are turning to artificial intelligence to help with their security efforts – and use technology which continuously monitors its network for suspicious activities. The company’s white paper says it uses “bank grade security standards” to protect against malicious hackers.

    Are security fears stopping crypto from becoming mainstream?

    It could be argued this is the case – but experts believe there are several other hurdles that the industry needs to face.

    Andrew Wong, a managing partner at IDCM, says the crypto world is still in its infancy – so much so that it will take at least three years before cryptocurrencies begin to gain dominance, and even longer for the public to start embracing it properly.

    In part, he believes this is because of the scalability issues affecting crypto – and the fact that blockchain technology can be difficult for novices to comprehend and use.

    Mr Wong, a former trader at JP Morgan, believes “more stringent know your customer (KYC) checks for centralized exchanges” will be introduced in the future – but believes this doesn’t have to be at the detriment of the industry’s progress. He said: “Cryptocurrency regulation is absolutely necessary so, as long as it is not suffocating innovation, it is a positive thing. Certainty is the main benefit of regulation.”

    How can I be sure an exchange is telling the truth?

    Actions matter more than words – so take a look at what they have been doing to protect themselves from hacks and keep their platforms secure.

    Investment in fraud analytics matters. When exchanges spend money on trying to ensure their systems are robust, it helps to protect you: the user.

    Many platforms regularly submit themselves to security audits by independent parties, who then publish their findings and disclose the vulnerabilities they have found. Reputable exchanges will publish the outcome of these audits in full – enabling you to see for yourself their strengths and weaknesses, and the steps they have taken to resolve things.

    You should also see whether or not the exchange you’re interested in participates in bug bounty programs. Put simply, this is where a platform offers a reward to “white hat” hackers who expose security flaws in their systems – playing cyber criminals at their own game and trying to exploit a glitch before they do. It’s a practice that has gained traction in recent years, with major corporations and even governments subscribing to these schemes.

    Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.

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  • Warren Buffett’s Holding Invests $600 Mln in Fintech Firms Focused on Emerging Markets

    Warren Buffett’s Holding Invests $600 Mln in Fintech Firms Focused on Emerging Markets

    Multinational holding conglomerate Berkshire Hathaway – which counts outspoken crypto critic Warren Buffett as its CEO and chairman – has invested around $600 million in two fintech payment firms focused on emerging markets, the Wall Street Journal (WSJ) reported Oct. 29.

    Both investments are said to have been spearheaded by one of Berkshire’s two portfolio managers, Todd Combs. In August, Berkshire is reported to have bought a roughly $300 million stake in the parent company of Paytm, India’s largest mobile-payments service.

    The second investment was made just this past week, through the purchase of shares in an initial public offering (IPO) for Brazilian payments processor StoneCo, the country’s fourth-largest by volume.

    The WSJ underscores that both decisions mark something of a departure for Berkshire, which  which has $711.932 billion in assets under management as of 2018, and is best-known for its investments in blue-chip firms such as Coca-Cola and acquisitions of utilities and insurance firms.

    Buffett has in the past said that tech investments are beyond his area of expertise, WSJ notes.

    That tech is not within Buffett’s “circle of competence” was affirmed by self-professed Buffett disciple venture capitalist Chamath Palihapitiya this spring, when he took his icon to task for his virulent anti-crypto stance.

    Combs, alongside Berkshire’s second portfolio manager Ted Weschler, are nonetheless reported to be “widening the net” of the conglomerate: yet, as WSJ highlights, both Stone and Paytm are considered to be established companies, which dominate their respective local markets and operate in tightly regulated industries.

    The WSJ says Berkshire’s backing is a sign of the “maturity” of the fintech sector, which reportedly raised almost $35 billion in venture capital during the first three quarters of 2018.

    Berkshire’s move to put major capital into two fintech firms that target emerging markets squares uneasily with the vocal position of Buffett, who has become notorious in fintech and crypto circles for castigating Bitcoin (BTC) as being “rat poison-squared.” He has made repeated statements claiming that Bitcoin is neither a currency, nor a way of investing. In October 2017, Buffet predicted that Bitcoin had entered the “bubble territory,” and was set “to implode.”

    India saw soaring demand for cryptocurrencies during the period of economic turmoil that followed its prime minister’s bold — and still highly contentious — demonetization policy in late 2016. Crypto’s popularity continued through 2017, eliciting a controversial anti-crypto crackdown from the country’s central bank (RBI) this April, which has prompted both public and industry-led petitions.

    As a final verdict on the RBI ban continues to be repeatedly stayed, the judiciary has now thrown the ball back in the executive’s court, setting a deadline for the government to clarify and finally cement its official position on crypto by mid-November.

    This month, in Brazil, the country’s largest brokerage has revealed it will launch a Bitcoin and Ethereum (ETH) exchange, saying it was pushed into the crypto business by the popularity of the asset class among investors.

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  • Bitcoin Is ‘Anything but Useful’ Says Ex-Federal Reserve Chair Janet Yellen

    Bitcoin Is ‘Anything but Useful’ Says Ex-Federal Reserve Chair Janet Yellen

    Bitcoin is “anything but” a useful store of value, former U.S. Federal Reserve chair Janet Yellen stated in a speech Monday, Canadian financial news outlet Kitco reported Oct. 29.

    Speaking during an interview at the 2018 Canada FinTech Forum in Montreal, Yellen – who rose to fame in the cryptocurrency community last year as the target of the now infamous ‘Buy Bitcoin’ session at a House Financial Services Committee meeting – doubled down on her previous criticism of the asset.

    “It has long been thought that for something to be a useful currency, it needs to be a stable source of value, and bitcoin is anything but,” she claimed, continuing:

    “It’s not used for a lot of transactions, it’s not a stable source of value, and it’s not an efficient means of processing payments. It’s very slow in handling payments. It has difficulty because of its very decentralized nature.”

    Having been present during Yellen’s speech, Satoshi Portal CEO Francis Pouliot was among the first to denounce her words on social media, describing them as “The Official NPC [non-player character] guidelines to Bitcoin FUD, courtesy of the FED.”

    At a press conference in December of last year, Yellen similarly called Bitcoin a “highly speculative asset” and “not a stable source of value." She also noted that the Fed was not “seriously considering” the concept of a state-issued digital currency at that time.  

    Yellen’s speech Monday echos not only her own previous comments on crypto, but also those made earlier this month by economist Nouriel Roubini, an outspoken cryptocurrency naysayer who foresees the entire ecosystem failing.

    Commentators have taken Roubini to task over his comments, arguing his lack of understanding of decentralized cryptocurrency has led him, like Yellen, to draw false conclusions about its resilience.

    “I can see a bubble when there is one – and to me, this entire space has been the mother and the father of all financial bubbles and now it’s [going to] burst,” he told Cointelegraph during an appearance at BlockShow Americas in August.

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  • U.K.’s Financial Regulator Mulls Ban on Sale of Crypto Derivatives

    U.K.'s Financial Regulator Mulls Ban on Sale of Crypto Derivatives

    The U.K.’s Financial Conduct Authority (FCA) has said it will consider whether to ban the sale of cryptocurrency-based derivatives, the Financial Times (FT) reported Oct. 29.

    Unlike crypto spot market activities, trading, transacting and advising on crypto derivatives such as contracts for difference (CFDs), options, and futures currently falls within the FCA’s regulatory perimeter and requires its official authorization.

    In a statement published Monday, the watchdog is reported to have said it will now launch a consultation in the first quarter of 2019 into whether or not to place a ban on their sale in future.

    The regulator’s remarks came the same day as a new report published by the Cryptoassets Taskforce – which includes representatives from the FCA, the U.K. Treasury and the Bank of England – emphasized that leveraged crypto-based derivatives were even riskier than spot market trading as they can amplify and “cause losses that go beyond the initial investment,” as well as imposing additional fees.

    FT reports that the sale of crypto derivatives have become increasingly profitable for London-listed online trading platforms, citing IG Group and Plus500 as examples.

    The FCA reportedly plans to launch a parallel consultation into whether to extend its regulatory jurisdiction to crypto assets themselves, as well as to infrastructure providers such as exchanges and wallet services.

    CryptoUK chair Iqbal Gandham is quoted by FT as saying the group was “pleased” by the proactive move, but stressed “[i]t is important that new rules are proportionate and do not put up excessive barriers, including for retail investors.”

    In its statement, the FCA is said to have “made clear that in its view cryptoassets have no intrinsic value and investors should therefore be prepared to lose all the value they have put in,” further highlighting that the asset class as a whole poses “potential future threats to stability.”

    As reported yesterday, the U.K. government Taskforce’s newly-published report proposed a three-fold framework for cryptoassets, depending on whether they are used as a means of exchange, for investment, or to support capital raising and the development of decentralized networks through Initial Coin Offerings (ICOs). The report struck a circumspect and interventionist tone, while recognizing the beneficial innovations of the emerging sector.

    Earlier this month, the legal director of London-based corporate and insurance law firm Reynolds Porter Chamberlain (RPC) said the introduction of crypto market regulations in Britain could take around two years.

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  • ‘Halal Coins Only’: First Islamic Crypto Exchange to be Launched in 2019

    ‘Halal Coins Only’: First Islamic Crypto Exchange to be Launched in 2019

    The ADAB Solutions project, based in the United Arab Emirates, is planning to launch FICE — the First Islamic Crypto Exchange which will be operating “according to the principles of Shariah law.” The company is expecting to reach $146 million daily trading and $4.4 billion monthly turnover by 2020.

    Islamic finance as crypto exchange base

    The new project hasn’t been launched yet but it has already gotten the attention of the crypto community. The First Islamic Crypto Exchange was marked as number one in a recently published Coin Shark rating “TOP 10 ICO Projects That Became the Most Useful Ideas of 2018.” The company says their product is an “opportunity for the crypto market to enter the Islamic world” and that it will be the “world's first cryptocurrency exchange that will operate in full compliance with the principles of Islamic finance.”

    That means there will be two special departments to control how the platform works. FICE will have a special Department of Islamic Finance and a Shariah Advisory Board in its structure. The Shariah Advisory Board will unite famous Islamic financial experts who will analyze and confirm that each of the cryptocurrencies which will be listed on FICE are “halal”, so Muslim clients which wish to use their services can rely on this estimation. According to ADAB Solutions, the difference between conventional and Islamic exchange platforms is that there will also be no speculations or market manipulation by FICE.

    Islamic finance’s boom

    Experts report a constant rise in Islamic finance over the last decade. In September 2018, Daily News wrote that the annual growth of this market is 10-12 percent over the past 10 years. Moreover, the analytics from Thomson Reuters in July 2018 estimated the value of Islamic finance as $2.2 trillion. They also noted that the industry is spread over more than 60 countries. The experts predict Islamic finance to grow to $3.8 trillion by 2022.

    According to the Pew Research Center, there are 1.8 billion Muslims in the world and this number is growing every year. That’s why ADAB Solutions believe that they’ve chosen the best time to create First Islamic Crypto Exchange. “The idea of FICE is really relevant and needed” —  the company said.

    ICO and future plans

    ADAB Solutions offers users to buy their own ADAB tokens during the ICO that was launched in August 2018 and will be held until February 2019. The cost of Islamic digital currency is $ 0.1 and the company expects the coin’s value to increase to $11.5 by the end of 2022. The ADAB token can be used for paying the commission on all transactions within the platform. The company also promises to automatically burn 10 percent of each commission that it receives in order to reduce the number of tokens and increase its value.

    ADAB Solutions expects to attract around 730,000 people after the launch of the project in 2019. The team plans to increase this number by almost three times and reach a 1.9 million audience in 2022, including Muslim and non-Muslim users.

    Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.

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  • Coincheck Reopens New Signups, Deposits and Withdrawals of ‘Some’ Cryptocurrencies

    Coincheck Reopens New Signups, Deposits and Withdrawals of ‘Some’ Cryptocurrencies

    Monex Group, the Japanese internet broker that purchased hacked cryptocurrency exchange Coincheck, announced it had reopened new account signups and limited trading in a statement Tuesday, Oct. 30.

    The latest phase of a step-by-step reboot of Coincheck, Monex added users could also begin depositing and purchasing certain cryptocurrencies.

    “...Here we announce that Coincheck has resumed ‘new account openings’ and ‘customers’ depositing and purchasing some cryptocurrencies’ services today,” the statement reads.

    From Tuesday, users will be able to deposit four cryptocurrencies: Bitcoin (BTC), Ethereum Classic (ETC), Litecoin (LTC) and Bitcoin Cash (BCH).

    Purchase options now extend once more to the three altcoins, Bitcoin having continued to be available in the intervening period since Monex took over.

    In future, Ethereum (ETH), NEM (XEM), Lisk (LSK), Ripple (XRP) and Factom (FCT) will return to Coincheck, “if the services are confirmed safe and become ready to be offered,” the statement adds.

    For those choosing to open a new account on the platform, Monex advised a strict know-your-customer (KYC) process would be in place, in line with regulations demanded from exchanges by Japanese regulator the Financial Services Agency (FSA).

    Fiscal results published by Monex yesterday, Oct. 29, revealed that Coincheck saw a 66 percent decline in revenue for Q3 2018.

    Monex purchased Coincheck for around $33.5 million in April, outlining plans to relaunch the exchange in full compliance with local regulations.

    In January, hackers stole funds from Coincheck at the time worth an estimated $534 million.

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  • Crypto Price Tracking App CoinTicker Installs Backdoors to Control Host Computer: Report

    Crypto Price Tracking App CoinTicker Installs Backdoors to Control Host Computer: Report

    Cybersecurity publications were sounding the alarm over cryptocurrency malware again Monday, Oct. 29 after a Malwarebytes forum user reported a price monitoring app for macOS was a trojan.

    Confirmed in a blog post by the cybersecurity software developer, community member 1vladimir reported suspicious behavior by an app called CoinTicker over the weekend.

    The app purports to let users track cryptocurrency prices from within the Mac toolbar, which update automatically.

    “Although this functionality seems to be legitimate, the app is actually up to no good in the background, unbeknownst to the user,” Malwarebytes’ blog post explains, adding:

    “Without any signs of trouble, such as requests for authentication to root, there’s nothing to suggest to the user that anything is wrong.”

    Upon further inspection, it became clear CoinTicker contained script that would download two backdoors onto the host machine, allowing a remote party to take control of it.

    The Github repository from which the CoinTicker malware downloaded the backdoors has since been deleted, tech magazine Bleeping Computer meanwhile notes.

    In its own analysis, the publication suggests the app could well have purely been developed to distribute the trojan.

    While it is unknown how many machines the malware has infected in the few days since its discovery, the episode is a further reminder of the voracity of attackers targeting cryptocurrency investors.

    As Cointelegraph has frequently reported, malware continues to surface, often in the form of hidden crypto mining scripts or even schemes that empty mobile or other hot wallets.

    Earlier this month, Google opted to remove all extensions with so-called obfuscated code – a feature which masks their purpose – from its Web Store in an effort to combat the problem.

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  • Survey: 60% of Americans Think Crypto Should Be Treated as Fiat in Political Campaigns

    Survey: 60% of Americans Think Crypto Should Be Treated as Fiat in Political Campaigns

    A new survey by blockchain-oriented research firm Clovr showed that 60 percent of respondents think that cryptocurrency should be treated like fiat currency in political elections.

    In the course of its research, Clovr surveyed 1,023 eligible voters registered in the U.S. for their understanding of what impact virtual currency could exert on the political process. Per the survey, almost 60 percent of the voters surveyed answered that crypto and the U.S. dollar should be treated the same, while only 21 percent of respondents said the opposite.

    “60 percent of eligible voters believed that it should be legal to donate cryptocurrency in federal elections under the same rules that apply to donations in U.S. dollars.”

    63 percent of the voters identifying as Republicans assumed that crypto was secure enough to be deployed for political purposes, and 52 percent of Democrats suggested the same. In regards to Independent voters, only 45 percent were reportedly comfortable with donations in crypto.

    73 percent of respondents who were aware of digital currencies believed security was not an issue for political donations, while 23 percent expressed concern.

    When asked about financial stability issues with crypto in politics, slightly more than half of Republicans — 52 percent — said that crypto was stable enough, while Democrats and Independents came in at 40 and 35 percent respectively.

    Per the survey, 25 percent of the participants stated that they would be more likely to make a contribution to political campaigns if crypto donations were an option. More than 20 percent of Republicans expressed their wish to contribute more substantial amounts if crypto was an option. 16 percent of Democrats and 12 percent of Independents stated the same, respectively.

    Regarding concerns over whether crypto in political campaigns would increase foreign interference in U.S. elections, 60 percent answered in the affirmative, wherein Democrats showed more concern than the other groups.

    Per the survey, 62 percent of respondents think that crypto donations could be used illegally in the U.S. political system. On this issue, all three groups showed similar results, with 64 percent of Independents, 62 percent of Republicans, and 61 percent of Democrats answering in the affirmative. 60 percent of respondents expressed concern over politician and party misuse of crypto donations.

    Last year, the Campaign Finance Task Force issued released a report dubbed “Public attitudes and campaign finance,” devoted to the role of money in the political system. According to the report, the public overall is “woefully” misinformed about campaign finance law, revealing that only four percent of Americans knew that corporations cannot contribute directly to the campaigns of candidates for president and Congress.

    The same survey found that “nearly 90% of respondents answered less than three of five factual questions correctly.” Respondents reportedly believed that the amounts of House of Representatives campaign contributions are $5.8 million on average, while the statistics show that average spending was $785,000.

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