Day: August 21, 2018

Order disapproving a proposed rule change relating to listing and trading of the Direxion Bitcoin ETF

Order disapproving a proposed rule change to list and trade the shares of the GraniteShares Bitcoin ETF and the GraniteShares Short Bitcoin ETF

Order disapproving a proposed rule change to list and trade the shares of the ProShares Bitcoin ETF and the ProShares Short Bitcoin ETF

A clean energy expert has argued that the conversation around BTC mining and energy consumption is “oversimplified”: energy sources, not consumption, is what matters

Steve Wozniak, co-founder of Apple, reveals plans to get “involved” in a blockchain startup for the first time, praises the technology

Bitcoin is mimicking the price action witnessed in early April, which indicates the corrective rally could gather pace in the next few days.

Alex Mashinsky, CEO of Celcius Network, claims that Initial Coin Offering (ICOs) listings have become lucrative business for cryptocurrency exchanges. He told CCN in an op-ed that the cost of listing new coins and tokens as “trivial and frivolous“.

Essentially, a company makes a new coin or token, which can be as easy as a few clicks of a button via Ethereum’s ERC-20 protocol. The new cryptocurrency is then sold in a pre-sale, where the developers collect funds in exchange for the new crypto. These funds are supposed to be used to develop the platform around the new crypto but often they end up being used for getting the new coin or token listed on a major exchange.

After the ICO pre-sale is done and the new crypto is live, investors are anxious to get a return on their investment. Theoretically, waiting for the crypto to mature on its own and eventually get listed on all the major exchanges due to its popularity is the best method but investors are now anxious to have the new crypto listed immediately on a major exchange so they can cash out.

The investors put a tremendous amount of pressure on the company behind the ICO to buy a spot on a major exchange. According to many reports, this can cost between USD 2-6 million. For small to medium ICOs, this could be all of the money they raised, leaving them nothing to develop their platform and technology. Binance is at the upper end of the fee scale for getting a new crypto listed; it is speculated that its USD 1 billion of profits in the past year is mostly from ICOs paying to list their new crypto.

Some industry experts also say that exchanges not only demand money but ask for a large fraction of the new crypto’s supply to be used as reserves to maintain proper liquidity. Some even claim that exchanges ask that the company behind the ICO pay for a market maker, which is a person or program that puts 10-20 orders on both the buy and sell sides to give the appearance of activity. This induces other traders to buy and sell the crypto as it appears there is plenty of activity and liquidity.

According to Mashinsky, the most common result is a pump and dump, where the new crypto’s price rises for a small period of time after listing, followed by the whale ICO investors selling their coins for a quick profit. On top of that, it is common for the exchange to short the new crypto with their massive reserve of coins from the ICO, making profits on these short positions as the price crashes.

The end result is new cryptos from ICOs are left in a dumped position, with some of the whales and the exchange making tremendous profits, while the ICO project itself and the smaller investors are left holding devalued coins.

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Renowned stock exchange investor Prasit Srisuwan claimed to be a damaged party in the case of a $24 million bitcoin scam that victimized Finnish national Aarni Otava Saarimaa. Srisuwan recommended Saarimaa to invest in DNA 2002 Plc shares, a bitcoin-related business, for its high-growth potential. He brokered the deal, but never managed to deliver the stock after taking the money.

Fraud Worth $24 Million In Bitcoin Exposes Prominent Names In Thailand

A cryptocurrency investment scam in Thailand has gained international attention as the country’s Crime Suppression Division (CSD) sought eight arrest warrants, including two siblings of the famous Thai actor Jiratpisit Jaravijit, who may face money laundering charges for having his bank account receive $630,000 worth of Baht from the scam. The 27-year old soap actor told the authorities his elder brother, Prinya Jaravit, was using his bank account.

Prinya, the alleged mastermind, was arrested and is now on bail. Prominent investor Prasit Srisuwan, who is abroad but also subject of an arrest warrant, told in a press conference that he was a victim instead of a culprit. He will be charged with fraud, according to CSD deputy commander Chakrit Sawasdee, who argued that the broker took the $24 million worth of Bitcoin from Saarimaa but never delivered the 500 million shares in DNA 2002 at 0.50 baht each that he was supposed to acquire. Saarimaa and his Thai girlfriend Chonnikan Kaeokaseeonly received only 345 million shares, prompting them to file a complaint with the police in January 2018.

At the press conference, the stockbroker explained that following the complaint earlier this year he lost credibility and reputation among peers and clients. He said he asked a retired law enforcement agent, Capt Thammanat Prompao to convince Prinya to deliver the remaining 155 million shares to Saarimaa. The 345 million shares already received were transferred in two tranches in November 2017.

“This case is complicated. We had to carefully examine documents and trace the money trail. For the money laundering charge, we are verifying the amount of money with commercial banks only in the accounts of the siblings and their family and relatives. The money needs to be frozen and brought back to the victims”, said Deputy Commander Sawasdee.

Last week, Thai authorities summonsed Prasit and seven other suspects. The bitcoin scam gang allegedly exchanged Saarimaa’s bitcoin for fiat currency and then laundered the money through a number of bank accounts. The CSD has frozen over 50 bank accounts and seized $5.27 million worth of plots of land connected to the scam. Prinya’s frozen accounts were holding a total of $3.3 million. His sister’s accounts held more than $4.2 million linked to the bitcoin scam.

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A publicly owned firm chaired by a Chinese billionaire lost millions through crypto investments, yet it’s still seeking to rebrand around the tech.