Day: April 17, 2018

Oz Management Chief Financial Officer Alesia Haas is Coinbase’s new CFO effective Tuesday.

Some of the cryptocurrency exchanges named today in the New York Attorney General’s “inquiry” into the ecosystem say they welcome the move.

The New York Attorney General sent letters to thirteen major cryptocurrency exchanges, asking them to disclose information on internal controls to “improve transparency and accountability”. #NEWS

Today, April 17th, is tax day here in the U.S, but a significant number of investors have apparently not reported gains from digital currency trading to the Internal Revenue Service (IRS).

TeamBlind and Credit Karma

According to a survey from TeamBlind, the anonymous messaging app popular in fintech circles, 46% of people who made money trading cryptocurrencies in 2017 have chosen not to disclose their taxable profits.

“We surveyed more than 2,600 users who said they earned money from cryptocurrency in 2017, and we asked them if they are reporting their earnings on their taxes this year. Nearly half said ‘No,’” according to TeamBlind.

This information comes just a few days after Credit Karma, the popular credit score website and tax platform, reported that less than 100 people had reported their crypto earnings to the IRS out of the platform’s 250,000 most recent tax filers.

IRS

Bitcoin multiplied in value more than 13 times last year, while the cryptocurrency market in its entirety gained well over $500 billion in value. As a result, U.S. households likely owe $25 billion in taxes for their digital currency holdings, according to estimates from Tom Lee, head of research at Fundstrat Global Advisors.

“For federal tax purposes, virtual currency is treated as property. General tax principles applicable to property transactions apply to transactions using virtual currency,” the agency said. According to the agency, digital currencies are liable for a tax as capital gain, meaning anyone who has taken out or paid for anything using cryptocurrencies are expected to report this information. 

Looking back, for the 2015 tax year the IRS indicated that only 802 people had included cryptocurrency gains or losses in their tax filings. That said, because of the massive differences between 2015 and 2017 with regards to the popularity of the cryptocurrency space, comparisons are difficult to draw.

Elizabeth Crouse, a partner at Seattle-based law firm K&L Gates, argues that a high risk tolerance amongst many crypto-enthusiasts means they are likely more willing to risk the chance that the IRS comes knocking, saying:

“If I had to guess, there’s probably a lot of underreporting.” Adding that, “Most of the people in the cryptocurrency world tend to have a pretty high risk tolerance.”

In related news, some investors have argued that tax day is the trigger of the new bullish Bitcoin run. According to Spencer Bogart who spoke with CNBC:

“Tax-selling has been a significant factor in downward crypto prices over the past few weeks. I would expect this downward pressure to abate after tax day.”

Image from Shutterstock.

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Russian communications watchdog Roskomnadzor tries to block Telegram app: dozens of unrelated services suffered network failures, Telegram still works. #NEWS

RChain has proven to be a very interesting project in the world of blockchain technology. Unfortunately, it seems the RChain Cooperative aspect of this project is running into some potential issues. One of the team’s members reached out to us to tell his side of the story, which paints a worrisome future for the RChain project itself.

Potential Issues for RChain

When it comes to any company or project involved in the blockchain industry, there are a lot of things which can go wrong. For RChain, it seems the development of its proprietary blockchain technology is going according to plan. That is how it would seem on the surface, anyway, as the report sent to us by one of the RChain Cooperative team members paints a very different picture compared to how most people expect this project to play out.

To put this into perspective, the report sent to us was commissioned by Nathan Windsor, who works for the RChain Cooperative team. He decided to get an independent report created regarding the development of RChain’s blockchain and cryptocurrency venture. By spending some of his own money, he got Aces United LLC to prepare the “due diligence” report in question.

Such a report is a way of validating the efforts made by the RChain team to date. Sadly, it seems this report highlights some big issues with the people running RChain. More specifically, the key members outlined in this document all have some sort of a checkered history. While that is not something most people would generally worry about, there are some valid concerns one needs to take into account, by the look of things.

Although the history of key project members doesn’t necessarily determine the future success of a blockchain project, the Aces United LLC report aims to warn investors. The firm is convinced that investors and stakeholders in this company need to pay more attention to the relationship between RChain Cooperative and Reflective Venture Partners. Moreover, Aces United LLC believes these entities’ strategic partnership is “evidence of a failure on the part of RChain Holdings and RChain Cooperative leadership.”

As one would expect, the report was eventually presented to the RChain team, which immediately led to Nathan Windsor being fired. The exact reasoning behind this harsh decision remains unclear to this day, but Reflective Ventures Partners decided to file a lawsuit against him as well. Whether this was done to smother Windsor’s attempts to make this information public, or because of something else entirely, remains anybody’s guess at this time.

With this report now being made public, it will be interesting to see how RChain’s investors and stakeholders respond to these developments. Reports like these are designed to help people conduct their due diligence, yet all information needs to be taken in stride. It is good to see firms such as Aces United LLC do a lot of the work on behalf of investors in this regard. In the end, everyone is still free to make their own decisions when it comes to RChain and how things are run.

Global digital security firm Avast will be demonstrating the risks posed to smartphones and IoT devices by cryptojacking. The company has a stall at the RSA 2018 conference being held this week and will be performing live demonstrations mining Monero.

Cryptomining Poses Risks to More Than Just Computer Uses

The demonstration hopes to show people how malicious cryptocurrency mining can affect both their privacy and the performance of their infected devices. Ondrej Vlcek, the CTO, EVP and GM at Avast explained to Business Wire:

“With the growing IoT landscape, PC users are no longer the sole victims of cryptomining malware. Now, IoT devices and smartphones are just as easily hijacked and turned into cryptomining machines — and it doesn’t matter if you own cryptocurrency or not.”

The experiment itself invites visitors to the Avast stand to partake in a cryptomining challenge using their own mobile phones. Those involved will mine Monero on their devices. This will give them the chance to witness the affects of cryptomining in real-time. They’ll also be supplied with a power bank for when their battery inevitably gets depleted in considerably less time than it normally would.

As well as learning about the harmful affects of cryptomining on devices, users will be entered into a prize draw to encourage participation in the experiment. The winner will receive a Samsung Galaxy S9 fully kitted out with the latest Avast Mobile Security suite.

Identifying malware on mobile or IoT devices is troublesome for users. Since the software runs secretly in the background, they might attribute the decreased performance of their gadgets to faulty hardware. The increased computational demands placed on devices can result in high energy bills, poor performance, and a much shorter lifespan. It can also result in personal data breaches.

According to research done by Avast in March 2018, the risks posed by cryptomining are largely unknown by the public. They surveyed 2,300 computer users on the topic. The results found that a quarter of those polled didn’t know what cryptocurrency was to begin with. A further two in five didn’t know that malware could be used to mine digital currencies. Vlcek elaborated on the research and his company’s experiment:

“This is the kind of malware that can run quietly in the background of any smart device. Our hope at Avast is to dispel myths and educate users on the very real risks cryptomining presents to personal data and device performance.”

Cases of devices being used to mine cryptocurrencies without their users’ consent have been rising of late. Symantec recently published their Internet Security Threat Report which identified the problem as one of the fastest growing in the security industry. Their researchers estimate that there has been an 8,500% increase in the number of examples detected on computers. Given these numbers, Avast’s efforts at spreading the word to visitors at their RSA stall might be preaching to the converted, but it’s certainly a much needed step in the right direction.

Image from Shutterstock.

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This article originally appeared on Bitcoin Magazine.

The use cases for blockchain technology are waiting to be discovered. While some people would love to see the Ethereum price go to the moon, its underpinning technology may get there first, by the look of things. The Resilient Networking and Computing Paradigm project is using blockchain and smart contracts to create a new breed of spacecraft.

Ethereum Technology to the Moon

It is evident there are a lot of things one can achieve with blockchain technology and all of its features. Even though most of the focus lies in the financial sector, it seems things are slowly heading in a different direction. For the time being, there are some rather unique use cases for smart contracts under development, although it will take some time before such ventures come to fruition in the real world.

For the project involving the University of Akron’s Dr. Jin Wei Kocsis, Ethereum technology is the logical solution to a pressing problem. More specifically, there is a big problem when dealing with spacecraft which need to find their way home. Although relevant guidance procedures have improved quite a bit, avoiding space debris is still an ongoing challenge, for obvious reasons. Coming up with viable solutions in this regard will prove to be an interesting challenge.

This is where blockchain technology and smart contracts can make a big impact in the months and years to come. Dr. Kocsis is currently working on a solution incorporating this technology as part of her Resilient Networking and Computing Paradigm. It is also worth noting this project received $330,000 in an Early Career Faculty Grant from NASA, as the entity also sees merit in exploring these new opportunities.

Using smart contracts, the RNCP will help create spacecraft which can essentially think for themselves. This should lead to them being able to make decisions to successfully avoid debris and other obstacles a craft may encounter during its trip. Using Ethereum technology to develop a decentralized, secure, and cognitive network and computing infrastructure for deep space exploration is something few people ever expected to see in their lifetime.

It is evident that developing such an implementation will not happen overnight. Dr. Kocsis acknowledges her first priority is to develop technology capable of recognizing environmental threats in order to avoid them. While NASA recognizes these efforts, it will be interesting to see if such a concept is even viable in the long run. Making spacecraft smarter is always an opportunity worth exploring.

For the time being, it remains a bit unclear how the research will move forward. Working on a concept like this one will take a lot of time and effort, for obvious reasons. It is good to see some industry leaders thinking outside the box in this regard, as there are a lot of innovative technologies worth paying attention to. Whether or not Ethereum’s blockchain is the right solution for this project is an open question.

The e-commerce giant describes how merchants and law enforcement could make a bitcoin transaction stream more valuable by splicing it with other data.

At press time, bitcoin has recovered to $8,100 after trading between $7,900 and $8,000 24 hours ago.

One of the primary reasons for yesterday’s $400 drop may be Kraken’s recent announcement that it was pulling out of Japan. The San Francisco-based cryptocurrency exchange previously entered the country’s digital currency arena to assist Mt. Gox, the infamous trading platform that declared bankruptcy after losing nearly half-a-billion dollars in BTC. Kraken officials have stated that operations within Japan’s borders are too expensive, and are pulling the plug on its business ventures there.

Japan serves as one of the world’s largest bitcoin and cryptocurrency havens, and any move stemming from within its financial industry is likely to have vast repercussions on the price of related altcoins, though not every currency is in the red or suffering deeply. In fact, various currencies have experienced solid rises within the last day, including litecoin – which currently stands at $138 following its previous stance of $127. Ripple’s XRP is also up to $0.67 from $0.65, while bitcoin cash sits at $777 – an eight dollar jump from yesterday’s $769 trading mark.

For the most part, bitcoin appears to have developed new strength at the $8,000 level, suggesting the currency is likely to stay here for the time being granted immediate rises don’t occur. This is a good sign considering the dismal outcome 2018 has had on bitcoin thus far. Some analysts predicted major slumps by mid-April, though the outcome appears to be moving in opposite directions. Bitcoin has jumped by $1,200 since last week, and has ultimately maintained its position.

One of the things alleged to bring further boosts to the bitcoin price is growing adoption in Asia. One source says bitcoin is amongst the top choices for B2B payments, predominantly in China and Asia, as well as for retail payments.

Luxury brand Bellatorra Skin Care, though based in Los Angeles, is expanding its operations into Asia, and representatives say the desire to pay with cryptocurrency is particularly strong.

“We expanded our business internationally this past year, and have had strong demand [for cryptocurrency] from customers in markets where fiat cross-border transactions have inefficiencies,” says CEO Nathan Halsey. “We have found cryptocurrency to be a viable solution for resolving these challenges, and we see other companies with international business adopting the same practices.”

The company has been partnered with bitcoin merchant services provider BitPay since the summer of 2017, and the customer response has been overwhelmingly positive.

“We have completed multiple six-figure transactions without an issue, and have settled funds from the time of customer payment to settling in U.S. dollars in our U.S. bank accounts in less than one business day,” Halsey further states. “We are definitely pro-cryptocurrency as a payment option.”

Chief commercial officer at BitPay Sonny Singh says that B2B now accounts for roughly 15 percent of the company’s transactions, and he expects those numbers to increase tenfold in the coming year. He states BitPay is currently revamping its staff to be ready for what they predict will be major financial changes.

“The staff will be focused on customer service, sales, engineering services, compliance, and other things you really need a local presence for,” he mentions.