This week’s summary of various cryptocurrency news and developments:
China’s largest exchanges enforced trading fees
Due to the People’s Bank of China’s involvement in the bitcoin trading market, China’s biggest bitcoin exchanges (Huobi, BTCC, and OKCoin) are now charging trading fees of 0.2 percent for every transaction. The official reason behind the move is to “curb market manipulation and extreme volatility”. The move, according to Reuters, wasn’t explicitly demanded by the People’s Bank of China, but was a decision in line with the bank’s desire to reduce volatility. BitVC, Huobi’s USD-specific exchange, also started charging 0.2 percent in trading fees.
Yunbi, a popular Beijing-based bitcoin exchange, also announced it would introduce trading fees when it comes to bitcoin, “to prevent speculation and sharp fluctuations of Bitcoin prices”. Other cryptocurrencies will see their fee rates unchanged.
Bitcoin Core Developer proposed decreasing block size, after a day that saw a $250 million backlog
Lukejr, a developer of the Bitcoin Core client and a Blockstream contractor, has proposed via Github that the block size should be decreased to a “safe value, and gradually increased over time, eventually expanding beyond the current limits”. Specifically, Lukejr proposed that the block size should be reduced to 300 kilobytes, after the bitcoin blockchain transaction queue backed up significantly on January 24, with over 60.000 unconfirmed transactions worth over $250 million stuck in limbo. This would mean a 70% reduction regarding today’s blocks.
Lukejr also proposed a yearly increase of roughly 17%, which would mean 1MB (the current capacity) would be achieved in 2024.
Bitfinex Hacker transferred 876 bitcoins into various addresses.
On August 2015, Hong-Kong based exchange Bitfinex was hacked. The hacker stole almost 120,000 bitcoins, worth around $110 million at the time of the theft. The criminal has now started to move some of the ill-gotten bitcoins, as transaction data compiled by blockchain enthusiast Chris Ellis shows. Blockchain forensics and compliance firms, such as Scorechain, have also been closely tracking the stolen bitcoins, as the company used Twitter to warn the public 153 BTC had been moved on January 25. Overnight, the hacker went on to transfer another 723 BTC, totaling 876 BTC.
The goal, according to Chris Ellis, could’ve been to test different exchanges to see how they’d react to different deposits. Bitfinex’s response was to offer a 5% bounty on every recovered bitcoin – even for the hacker.
— Bitfinex.com (@bitfinex) January 27, 2017
Bitcoin trading fees at major bitcoin exchanges make volume plunge in China
Although 0.2 percent might not look like a lot, it was enough to push the bitcoin trading volume down in some of China’s biggest bitcoin exchanges that recently began charging that much in trading fees. One hour after the fees were announced, trading volume in China fell over by as much as 80%. The plunge can certainly be attributed to the lack of automated bitcoin trading, used by Chinese traders to take advantage of arbitrage opportunities.
The People’s Bank of China will continue on-site bitcoin exchange inspections
In its latest statement, the People’s Bank of China (PBOC) announced it was going to continue to oversee bitcoin exchanges in the country, a week after it first started doing so, finding irregularities within these exchanges, as reported by Deep Dot Web. The bank also issued a warning to investors so they’ll be cautious when it comes to bitcoin platform transactions. In the translated statement, the bank said: “According to the initial inspection and the problems found, the inspection group decided to continue to focus on payment and settlement, anti-money laundering, foreign exchange management, information and financial security and other aspects of further examination.”
Blockchain technology is being used to prevent property fraud in Africa
A start-up dubbed BenBen is using a digital land registry that allows users to scan for land information, and can carry out property transactions. This allows the start-up to help citizens fight property fraud, as traditionally it takes around two years to register a property after it’s bought, giving scammers time to claim they own the land, making the transaction illegal.
Since property fraud is a huge thing in Africa, getting a mortgage can be hard, as most banks won’t commit their money knowing they might get scammed. Using blockchain technology, BenBen can ensure the security of property records. The company has been accepted on the Cambridge Social Ventures incubation programmer at Judge Business School.
Bitcoin at $919 as the Chinese New Year arrives
At the time of press, one bitcoin is worth $921, according to Bitstamp, even after the trading volume declined in some of the biggest exchanges in the world. As reported above, bitcoin’s trading volume took a hit this week, as a few exchanges implemented 0.2 percent trading fees. Yet, a lot of analysts believe the trading volume is down because the Chinese New Year is here, which means the biggest market is currently celebrating.