This week’s summary of various cryptocurrency news and developments
Facebook banned all cryptocurrency, ICO related ads
Social media giant Facebook announced this week it will ban all cryptocurrency.-related ads to “prevent scams.” According to Mark Zuckerberg’s company, “ads should be safe” and as such deceptive ads, reportedly such as those for ICOs and binary options, don’t belong on its platforms. The move means even legitimate cryptocurrency businesses won’t be able to advertise on the company’s platforms, Facebook and Instagram. The post announcing the far-reaching policy reads:
- “We want people to continue to discover and learn about new products and services through Facebook ads without fear of scams or deception. That said, there are many companies who are advertising binary options, ICOs and cryptocurrencies that are not currently operating in good faith.”
Coincheck to compensate 260,000 NEM users following $500 million hack
Last week, DeepDotWeb reported on what is now being called the “biggest theft in crypto history,” as Tokyo-based exchange Coincheck was hacked for 500 million NEM tokens, then worth over $530 million. The exchange recently released a notice revealing a plan to compensate the nearly 260,000 NEM holders affected by the security breach. Per the notice, Coincheck will refund its users by depositing Japanese yen to a wallet, after calculating the compensation price. Per reports, this means users will receive 88.5 yen times the number of units they held before the funds were stolen. A total of $425 million will be paid back to users, although the actual method for applying the reimbursement, just like the date in which it’ll be applied, hasn’t been determined.
Samsung is manufacturing ASIC chips for cryptocurrency mining
South Korean tech giant Samsung recently revealed its semiconductor business is booming, as it recently surpassed Intel as the world’s largest chipmaker. According to TechCrunch, the company is now in the process of creating hardware specifically designed to mine cryptocurrencies like Bitcoin and Ethereum. The company will provide application-specific integrated circuits (ASICs) to an unnamed Chinese mining firm. A company spokesperson stated:
- “Samsung’s foundry business is currently engaged in the manufacturing cryptocurrency mining chips.”
Samsung recently stated that, due to growing demand for cryptocurrency mining, it will provide 8nm and 11nm processors to meet market needs. It will also start a “risk production of 7-nano.” The South Korean giant’s move into the cryptocurrency mining industry is bound to bring Chinese-based Bitmain, which reportedly has over 70 percent of the market share, fierce competition.
NIST report claims Bitcoin Cash is the original cryptocurrency, and Bitcoin is a fork
The National Institute of Standards and Technology (NIST) recently published a draft of its official research into blockchain technology. Titled “Blockchain Technology Overview,” the 57-page paper, which was published by the institute’s Computer Security Resource Center (CSRC), claims that Bitcoin Cash (BCH) is the “original” Bitcoin created by Satoshi Nakamoto, while Bitcoin itself is a “fork.” The report reads:
- “When SegWit was activated, it caused a hard fork, and all the mining nodes and users who did not want to change started calling the original Bitcoin blockchain Bitcoin Cash (BCC). Technically, Bitcoin is a fork and Bitcoin Cash is the original blockchain. When the hard fork occurred, people had access to the same amount of coins on Bitcoin and Bitcoin Cash.”
The report, intentionally or not, gets in on the scaling debate. It does, however, contain factual errors, as SegWit was activated through a soft fork. While Bitcoin Cash was ‘created’ through a hard fork. The report seemingly didn’t affect the market, but it is bound to further increase newcomer confusion.
Cryptocurrency exchange Bitfinex, Tether subpoenaed by US regulators
The US Commodity Futures Trading Commission (CFTC) has reportedly sent both Bitfinex and embattled startup Tether subpoenas on December 6. Bitfinex is home to one of the most popular BTC/USD trading pairs, and is run by the same people that run Tether, a startup that issues a cryptocurrency supposedly pegged to the dollar 1:1. The CFTC regularly sends subpoenas in order to gather information. Bitfinex and Tether emailed Bloomberg a response, that reads:
- “We routinely receive legal process from law enforcement agents and regulators conducting investigations. It is our policy not to comment on any such requests.”
Various critics have notably alleged Tether’s USDT tokens aren’t actually backed by any US dollars. According to critics, Tether is operating a fractional reserve that is artificially inflating Bitcoin’s price, to cover up insolvency at Bitfinex. While these claims haven’t been proven, a long-awaited balance sheet audit that could put them to rest hasn’t been released as well.
India isn’t banning Bitcoin, despite circulating rumors
This week, India’s finance minister Arun Jaitley addressed cryptocurrencies while delivering the country’s budget. He stated that the government “does not consider cryptocurrencies as legal tender or coin,” and that as such it will do what it can to “eliminate the use of these cryptoassets in financing illegitimate activities or as part of the payments system.” Most media outlets started claiming India was about to ban Bitcoin, when in reality the government clarified it will crackdown on the illegitimate use of cryptocurrencies, and dissuade the public from using cryptocurrencies as payment instruments. As CCN puts it, the truth is a lot more gray, as the minister was then explicitly asked if the government is moving to ban cryptocurrencies. Here’s a direct translation of the exchange:
- “TV Host: We’ve seen a lot of excitement over Bitcoins. Why aren’t you banning it instead of stating it isn’t legal tender?
Jaitley: We are discouraging people from using it now. There is a government committee that’s looking into it right now and they will announce their decisions and next steps after they are done.”
Bitcoin at $9,404 as market starts to recover
This week, the cryptocurrency ecosystem endured a steep correction, that saw Bitcoin hit a low of $7,908, according to data from CoinMarketCap. The dip was partly moved by the news that were published this week, as various mainstream media outlets reported on the Bitfinex, Tether subpoena and on India banning Bitcoin – although it was laetr on revealed the country wasn’t banning the cryptocurrency. At press time, Bitcoin is trading at $9,404 and its market cap is of $158 billion.