Bitcoin Corrects as Crypto Market Gets “Mt.Goxed” Once Again: Week in Review Mar. 12
In the past seven days, the price of bitcoin dropped by 20 percent. This decline was primarily driven by news that the bankruptcy trustee of the defunct bitcoin exchange Mt.Gox has been selling $400 million worth of bitcoin (BTC) and bitcoin cash (BCH) over the past five months. The mass sell-off was leveraged to raise funds for the exchange’s creditors and the trustee reportedly still sits on a substantial amount of bitcoins for intended sale.
The price drop was further exacerbated when rumors began circulating that the popular digital currency exchange Binance had also been hacked. While these reports were quickly refuted by the exchange’s CEO, the market still initially absorbed this news negatively.
Moreover, US Marshals have announced that they will be auctioning off $25 million worth of confiscated bitcoin later this month, which has added more pressure on the price of bitcoin.
In light of the upcoming G20 meeting, where global lawmakers will discuss cryptocurrency regulations, it is unlikely that we will witness a robust bitcoin price recovery until after the union in Buenos Aires, Argentina the summer of 2018.
On March 7, 2018, Tokyo attorney and bankruptcy trustee for the dead Mt. Gox exchange “spilled the beans” on his BTC and BCH sales from late September up until February 2018.
Nobuaki Kobayashi revealed that he had sold about $400 million worth of the two virtual currencies
Kobayashi was in charge of the funds raised to distribute among the Mt. Gox’s creditors.
He came out last week saying that he has been dumping part of the funds into the market since late September (around 40,000 bitcoin).
The trustee also revealed that he is still sitting on another $1.9 billion worth of the cryptocurrency (or approximately 160,000 bitcoin) and will consider offloading those as well as he raises cash to distribute to Mt. Gox’s creditors.
One website, created by Reddit user Gaelitoo, tracks the holdings of the trustee and gives information on the remaining bitcoin holdings.
Posting on the Binance website, the company disclosed information on the recent theft attempts and also details how the exchange foiled them and preserved users’ investments.
Amid several exchanges’ losses due to cybercrime, Binance has reaffirmed itself as a secure exchange and demonstrated at least one good reason why it has become the largest cryptocurrency exchange in the world.
Starting with “Fellow Binancians,” the company demonstrated true transparency in its bulletin surrounding a recent phishing attempt that would have cost users a fortune in digital currency.
“On March 7, UTC 14:58-14:59, within this 2 minute period, the VIA/BTC market experienced abnormal trading activity. Our automatic risk management system was triggered, and all withdrawals were halted immediately,” disclosed the leading exchange.
Although the Binance hack generated rumors that some observers have cited as factors in Bitcoin and other values taking significant dips, the post has unambiguously assured users of the exchange’s security protocols at play.
There is a sale planned for March 19, 2018, in which the United States Marshals are aiming to auction almost $25 million in BTC. The sell-off would be a significant portion of their crypto stockpile accumulated in recent times.
They announced their plans for this auction on March 6, 2018, and detailed how there would be about 2,170 bitcoins available in this sale.
Any party that wishes to sign up as a bidder will have to make a deposit of $200,000, as well as meeting all of the registration specifications before the auction to participate as outlined by the Marshals Service.
The event is set to be broken into 14 different sessions, with there being two 500 BTC auctions, eleven 100 BTC auctions and a single auction of 70 BTC up for sale.
Surprisingly, there might be a silver lining for victims of the Japanese Coincheck heist.
Around 260,000 traders who lost money due to the theft will be reimbursed at a rate of approximately ¥88 ($0.84) for each of the XEM coins stolen from affected accounts.
Luckily for those who lost currency, values have shifted, meaning they’ll come out around $262 million ahead.
Because of a drop in the value of the lost digital currency, which has offset losses, the reimbursement by Coincheck means that the original victims will, in fact, come out in a better financial position than where they would have been had their currency remained in the exchange.
A report released by the Russian parliament formally broke news of Russia’s intentions to legalize innovations surrounding the technology.
This publication was released on March 1, 2018, and details how President Vladimir Putin has implemented the deadline for the adoption of this legislation by July 1, 2018.
This announcement leaves just under three months from the time of this announcement until the legalization of exchanges in Russia is complete.
The report refers to a couple of draft laws also focused on blockchain technology and had already been deeply considered.
The Ministry of Finance in the country has placed particular attention to the regulations surrounding the operation of initial coin offerings (ICOs) alongside a draft law related to crowdfunding that was released by the Russian Central Bank.
The two leading authorities have come to an agreement on the majority of the regulatory changes in the cryptocurrency sector except for those related to crypto exchanges that will be in operation in Russia.
The Russian central bank is not a fan of retail investors and traders getting involved in the trading of cryptocurrencies.
The U.S Commodities and Futures Trading Commission (CFTC) has said that virtual currencies are commodities and in a recent lawsuit filed against a crypto-related business, a New York district court has ruled in favor of the CFTC.
Judge Jack Weinstein, from the district court in New York, has indicated that “Virtual currencies can be regulated by CFTC as a commodity.”
In the order written on March 6, 2018, the big wig stated that: “Virtual currencies are ‘goods’ exchanged in a market for uniform quality and value. [They] fall well within the common definition of ‘commodity.’”
According to the case file, at issue in the case was whether the regulatory body had enough rights to regulate cryptocurrencies as commodities since no federal level laws are governing the crypto industry.
The other focus point was whether it was legally correct for the CFTC to “exercise its jurisdiction over fraud that is in no way connected to the sale of futures or derivative contracts.”
The American online payments provider, PayPal, has filed for a patent seeking to expedite the transfer of virtual currencies from one wallet to another.
The American firm will also generate specialized keys for enabling faster transactions and payment settlement across a blockchain.
Currently, if a sender has to transfer a certain amount of digital tokens to another wallet, the process can take an average of ten minutes or more.
This patent application filed by Paypal dated August 30, 2016, lists San Jose’s Cheng Tian and Sandy Lynn Godsey as inventors.
The application explains that it will enable faster cryptocurrency payments by creating a first user primary wallet having a first user primary key.
San Francisco-based blockchain startup Ripple is one step closer to making a leading impact on Japan’s banking system. The company announced Tuesday that it’s all set to launch a new payment app that settles transactions in real-time.
Dubbed “MoneyTap,” the new app has already wowed the Japan Bank Consortium, and as such, 61 of its member banks have agreed to deploy it once the app goes live later this fall.
As for the specific product release roadmap, it is estimated that the initial testings will begin in April, followed by the app’s mass availability by the end of 2018.
In an official blog post, Ripple stated that MoneyTap would first make inroads into the fintech inventory of Japan’s SNI Net Sumishin Bank, Resona Bank, and Suruga Bank, presumably sometime in the autumn of 2018.
The apps deployed by each of these banks will have Ripple’s distributed ledger technology (DLT) at their heart. Once the initial deployment is successfully over, other banks in the consortium will join the bandwagon by deploying MoneyTap.