Tezos Co-Founder Kathleen Breitman: Platform Will Soon Be Launched

Tezos’ co-founder Kathleen Breitman has promised to launch the platform in several weeks, despite ongoing lawsuits and no access to ICO funds.

Kathleen Breitman, the co-founder of the self-governing Blockchain protocol Tezos, has promised to “go rogue” and launch the platform in several weeks, despite ongoing lawsuits plaguing the project. The announcement took place during the UCLA Blockchain Lab’s Cyber Days conference Feb. 17-18.

Tezos raised a record-breaking $232 mln during its Initial Coin Offering (ICO) in July 2017. The project has since been a subject of scrutiny and multiple lawsuits over the question of its compliance with the U.S. Securities and Exchange Commission (SEC) regulations, among other things.

It is alleged that the tokens sold to US investors during Tezos’ ICO were actually securities. Since the company has not registered them with the SEC, this would constitute securities fraud.

However, at a UCLA conference which took place last weekend, Kathleen Breitman promised to “[go] rogue in the next few weeks” and release the “tezzies” tokens (XTZ) on their own terms, despite legal troubles. “Things needed to move forward. It’s unfair, but we need to ship the code,” Breitman added.

Notably, Tezos is managed separately, with Kathleen Breitman and her husband and co-founder Arthur Breitman controlling the project’s source code, and the Tezos Foundation controlling all the funds collected during the ICO.

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Don’t believe the hype. The five largest “ICO exit scams”: Expert Take

More than $20 million stolen by five largest ICO exit scams.

In our Expert Takes, opinion leaders from inside and outside the crypto industry express their views, share their experience and give professional advice. Expert Takes cover everything from Blockchain technology and ICO funding to taxation, regulation, and cryptocurrency adoption by different sectors of the economy.

If you would like to contribute an Expert Take, please email your ideas and CV to a.mcqueen@cointelegraph.com

The majority of the world’s financial markets are now tightly regulated, and for that reason, fraud is becoming increasingly rare. Enterprising scammers are turning to fintech innovation which is currently unregulated – cryptocurrency.

Essentially, a crypto scammer aims to persuade ‘unwitting investors’ to buy fake coins by transferring either fiat currencies or cryptocurrencies. In this column we will only focus on the so-called ‘ICO exit’ scam, not thefts, hacks or Ponzi schemes.

We define a project as a scam only when it is proven that the money collected during a pre-ICO or ICO was stolen and the team has disappeared. This means the fraud was preplanned and the theft of investor funds deliberate.

PlexCoin ($15 million)

The PlexCoin ICO was halted in December 2017 by the US Securities and Exchange Commission (SEC) in response to an official complaint that founder Dominic Lacroix was defrauding American and Canadian investors. The complaint alleged that Lacroix was advertising an astronomically high return of 1,354% (that the SEC determined was unable to be delivered), pushing forward a group of fake experts to bring legitimacy to his project, and trying to obscure his past financial crimes, which included defrauding investors in a micro-loan venture.

The SEC has frozen all of the $15 million gathered by the ICO from its launch in August 2017. Lacroix was jailed, and the PlexCoin parent company fined $100,000. About $810,000 was still being held by payment processing company Stripe while the rest of the funds were located in various cryptocurrency wallets belonging to the Lacroix. It’s unclear exactly what charges will be brought against Lacroix and what will happen to the money deposited in his wallets. However, PlexCoin was one of the largest attempted ICO exit scams in history, which thankfully was nipped in the bud.

Benebit ($2.7 – $4 million)

Benebit claimed to use a Blockchain token system to unify customer loyalty programs, like frequent flyer miles. This ICO had all the trappings of legitimacy, including a moderated Telegram channel with over 9,000 members, a marketing budget of over $500,000, and promotions for the token pre-sale. With a novel concept, a serious-sounding white paper, and some well-spent marketing dollars, the Benebit team were able to generate a good deal of hype, and investors began to buy in.

However, things started to go south when someone noticed that photos of the team appeared to have been stolen from a UK school for boys. Passport details provided by the ‘founders,’ were all fake. After this revelation, the team behind the scam began pulling down anything related to Benebit, including the website, white paper, and social media accounts. Estimates vary, but the scammers are believed to have walked away with at least $2.7 million and as much as $4 million.

Opair and Ebitz ($2.9 million)

A motivated community of small-time investors who put money into Opair and Ebitz are trying to track down a mysterious developer known only as Wasserman, the apparent mastermind behind two ICO scams which netted a combined total of 388 BTC.

Opair promoted a decentralized debit card system using its own token, XPO. Users discovered that the LinkedIn profiles of some of the team were fake and Opair rapidly vanished, but not before generating just under 190 BTC in its ICO in the summer of 2016.

Amateur investigations carried out by duped investors revealed that the mail servers for Ebitz were rerouting to the domain of Opair, which billed itself as a clone of ZCash with some small changes. The team, a self-described “group of ethical hackers,” were hoping to raise 500 BTC through their ICO, which started on November 28 2016. In two days users of BitcoinTalk spotted the shady connection of Ebitz’ MX records to Opair.

The Ebitz website was taken down soon afterwards, but the ICO did manage to gather about 200 BTC before disappearing; although many users speculate that the BTC mostly came from the developers to provide ‘fake volume,’ or the impression that many people had already invested in the project in order to boost trust and lure other investors to buy their token.

REcoin and DRC ($300,000)

On the face of it, REcoin (Real Estate coin) and DRC (Diamond Reserve Club) tried to do something ambitious and daring – create a cryptocurrency that was backed up with real-world assets – real estate and diamonds. Their founder Maksim Zaslavskiy claimed that both startups were fully staffed, lawyered up, and had already formed relationships with retailers and investors – none of which was true.

The SEC alleges that neither REcoin nor DRC had any “real operations”, that both startups had misrepresented their total level of investment, and that neither of the proposed projects had any tokens or anything to do with Blockchain whatsoever. SEC decided that REcoin and DRC weren’t ICOs at all and were actually securities, which led to Zaslavskiy’s arrest on September 29 2017. According to the SEC, Zaslavskiy did manage to rake in about $300,000 before being caught, despite he initially saying that funds raised from both ICOs amounted to over $2 million.

PonziCoin ($250,000)

Yes, PonziCoin is a real cryptocurrency, and yes, some very gullible people were separated from their money after investing in it. Even more surprising, the most recent PonziCoin, which bills itself as “the world’s first legitimate Ponzi scheme,” is actually the second PonziCoin to exist. The first one came out in 2014 and made off with about $7,000 in cryptocurrency, which by some estimates could have been worth over $2 million today.

Another PonziCoin project appeared in 2017 using the same web address.

Initially intended as a gag, it featured a public and open admission on its website that it was a scam. However, that didn’t stop some investors from pouring money into the ‘product.’ In total, a project, which openly admitted to being a scam, raised over $250,000, and, surprise, surprise, the ‘founder’ ran away with the cash (after being baffled that anyone would invest at all given their openness and honesty).

Six questions to ask

ICO exit scams thrive in the current environment of unbelievable profits, overwhelming hype, and the time-constrained nature of ICOs, which make investors feel like they need to invest quickly or risk losing out on a good deal. No matter if you are just starting out or are a seasoned investor, every single decision needs to be analyzed thoroughly – there is no substitute for due diligence. If you are considering investing in an ICO, we highly recommend taking the following steps:

  1. Read the ICO white paper thoroughly. Does the concept make sense to you?
  2. What problem is the product solving? Does it make business sense?
  3. Study the team and their experience. Get in contact with representatives and ask difficult questions. Dig into their history, LinkedIn profiles, and previous jobs. Helpful hint: scammers will sometimes use fake pictures. Google’s reverse image search will work wonders.
  4. Check forums to gain insight into what the cryptocurrency community is saying about the project. Many people there have been victims of ICO scams, so they will have a sharper eye for red flags.
  5. Make sure that the ICO is planning on using a trusted escrow company to handle funds for their ICO. Escrow gives you an additional layer of protection, ensuring that you will at least receive the promised tokens from the ICO before parting with your hard-earned capital.
  6. Take a look at what rating companies are saying about the ICO. If the new project isn’t rated, there’s a high chance that it’s a scam. Also be sure to check and compare risk scores.

We believe that cryptocurrency is the future and that this current period of uncertainty is temporary, it is still wise to be cautious and prudent before investing your hard earned fiat or cryptocurrency in new ventures.

The views and interpretations in this article are those of the author and do not necessarily represent the views of Cointelegraph.

Brian Kean is the Chief Business Development Office at the investment evalutation agency, ICORating. He has extensive experience in investment funding and communications in retail businesses worldwide.

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Israeli Tax Authority Outlines Tax Guidelines for Digital Currencies

The Israeli Tax Authority has issued a circular outlining its position on Bitcoin and other digital currencies. The agency will look at the issue in two ways to determine tax status: Those who buy digital currencies as an investment, versus those who trade in order to make a living or run a business. The even-more complex issue of regulating initial coin offerings (ICOs) is yet to be dealt with.

Regardless of which group users might fall into, as far as the Tax Authority is concerned, digital currencies like Bitcoin are to be considered an asset, not a currency.

This means that a person who holds digital currencies in order to create a capital gain — while not engaging in business — will be exempt from paying VAT (value added tax), but will be liable for capital gains tax, which in Israel is between 20-25% for most taxpayers; For those who engage with digital currencies for business purposes things are a little rougher, as they will have to pay 17% VAT on top of the capital gains tax.

Mining: Businesses that generate cryptocurrency through mining operations will be taxed as factories in Israel, depending on the volume of their activity. Further, entities whose income volume from cryptocurrency qualifies them as a business will now be considered a financial institute and will be taxed according to the same regulations that govern banks and currency exchanges in the country.

The Israeli Tax Authority also requires that all digital currency transactions be documented for a possible audit. This requirement, specifically, might face some opposition, as it seems to go against what decentralized, semi-anonymous digital currencies stand for.

The agency says that in order to be able to present relevant evidence in the case of an audit, the taxpayer must demand documents outlining the trade, and verify the existence of the transaction and its monetary volume. In addition, the seller must attach the pages of the bank accounts through which the purchase and sale funds were transferred (and/or a computer screen shot) as well as the date and time it was held by the seller.

Despite this, the Israel Bitcoin Association has come out in favor of the Tax Authority’s move – primarily because it formally “recognizes” Bitcoin and other digital currencies as tangible things. Chairman of the group Manny Rosenfeld had the following to say with regard to the new guidelines (translated from Hebrew from news site Ynet):

“The digital currency revolution is here to stay. In the past year we have been working hard with the Tax Authority to adapt the draft circular that was published to the reality on the ground and to allow digital coins – a huge growth engine of Israeli high-tech – to develop and blossom. We are pleased that the Tax Authority has made several amendments to the circular in accordance with the positions we presented.”

The post Israeli Tax Authority Outlines Tax Guidelines for Digital Currencies appeared first on NewsBTC.

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Wyoming Introduces New Bill To Exempt Crypto From Property Taxation

A new bill proposed in the Wyoming state senate would exempt virtual currencies from property taxation.

A new tax bill has been introduced in the Wyoming state senate on Feb. 16 that would exempt virtual currencies from state property taxation, and suggests an effective date be provided for the tax exemption implementation.

Wyoming Senate Bill 111 was introduced by senators Ogden Driskill, Tara Nethercott, and Chris Rothfuss, along with representatives Tyler Lindholm, David Miller, and Jared Olsen. All are Republicans with the exception of Senator Rothfuss.

The bill received 26 “ayes,” from a mixture of Republicans and Democrats, 3 “nays,” all from Republicans, and 1 “excused.”

This Republican and Democratic backed bill comes as a growing bipartisan movement of US lawmakers are calling for more crypto regulation.

The bill is short and to the point, proposing a list of “intangible items” that should qualify for property tax exemption, like fiat currency, gold, cashier’s checks, and “virtual currencies.” Virtual currencies are defined as anything that digitally represents value as a medium of exchange or unit of value, and as well as not being recognized as legal US currency.

Taxation requirements for cryptocurrency profits in the US are a relatively grey area, with US citizens’ crypto assets being subject to federal property and payroll taxes. However, the personal finance service Credit Karma reported that only 0.04 percent of customers reported their crypto assets to the US Internal Revenue Service (IRS) in 2017 as of Feb. 13.

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Measured Approach Towards Regulation of Cryptos – the White House

Cryptocurrency Law and Legislation

Rob Joyce, the cybersecurity coordinator and special assistant to the president for the White House, added that the US is still on a path which will be long before meeting the first regulation for the world’s first crypto.

The almost three-decade veteran of the National Security Agency  that give-in his part in coordinating policy strategy for cybersecurity between gov, companies and NGO’s – Joyce, at the Munich Security Conference in Germany highlighted out the importance of taking thought-out steps and a measured approach to cryptocurrency and Bitcoin which is in-contrary to rushing towards the regulation that might bring up various consequences:


Still, Joyce recognizes the already-proven criminal potential within the cryptocurrency space. As reported by CNBC — which incorrectly claims Bitcoin transactions are “completely anonymous” — Joyce doesn’t gloss over the inherent difficulties involved with monitoring criminal transactions across the blockchain, explaining:


While credit card companies and banks can reverse fraudulent-status set transaction, cryptocurrencies do not have virtually no means to protect those that have been targeted by theft.

“With the current instantiation of bitcoin and other cryptocurrencies, we haven’t figured that out yet,” said Joyce. “So it’s a problem.”

But, this kind of approach by the White House and the US government signals directly that the regulation of cryptocurrencies can be taken as positive in contrary to what often seems like a very long on-going regulatory FUD.

The post Measured Approach Towards Regulation of Cryptos – the White House appeared first on Ethereum World News.

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Korona: Hungary’s Very Own Cryptocurrency

Europe’s newest digital currency, the Korona, which runs on the Lightning Network and is being touted as more stable, safer, and cheaper to use than its competitors, was launched in Budapest, Hungary on February 15th. Korona’s ICO is scheduled for March 26th, and the token will be immediately available for payments and transfers. 

According to a recent study by the University of Cambridge Judge Business School, customers are increasingly adopting new forms of payments for cost efficiency reasons. 86% of the payment companies surveyed utilized the Bitcoin network as the main payment source for cross-border transactions. However, it has problems in terms of transaction times, scalability, and the flexibility to build smart contracts on its system.

“Banking as we know it today will eventually evolve into different platforms. We started this project because we saw the opportunity to take cryptocurrency technology into the future,” Jean-Marc Stiegemeier, Korona’s CEO, said during the launch.

Despite being developed primarily by Hungarians, the headquarters of the Korona are in Zug, Switzerland — with plans for the token to be used throughout Europe, and beyond (as per Korona’s whitepaper). According to the team, the token was not incorporated in Hungary because they see Zug as the “crypto-valley” of Europe: Providing a more efficient and stable environment, two things both customers and shareholders are looking for.

“Over the next few years we are going to see a revolution in the banking sector,” Stiegemeier, said. “Within ten years cryptocurrency will be used and accepted worldwide.”

Part of the business model for the Korona is a purpose-built bank and payment platform that will operate under the supervision of Swiss financial authorities. According to the developers, 90% of current cryptocurrencies are “pseudo-currencies,” and not suitable for actual, real-world transactions: “Bitcoin is slow and too expensive for businesses. It costs 20 US dollars for each transaction and it is not efficient for retailers,” Korona’s blockchain advisor and professor at the Corvinus Business School Dr. Tuan Trinh explained.

How does it work?

According to head of technology development Attila Bustya, an e-commerce website will be launched, hosting those websites which normally do not accept cryptocurrency payments. Also, a new integrated Price Comparison System will be created so that users can choose their products for the best and cheapest price globally. “For a top-notch phone we pay more in Europe than in the US, it is not fair,” Bustya said, outlining the value of this new price comparison tool.

“Business clients today find it hard to use cryptocurrency because of high taxation and missing information. We are developing business wallets which will allow businesses to register and receive various services to support their compliance: Support for VAT reporting, invoicing, accounting, and such” he continued.

Recently, China, Canada, and Russia have taken a look at blockchain technology and its national-use potential. And the European Union, although wary of cryptocurrencies, is certainly a supporter of blockchain-based technologies. Earlier this month it created the EU Blockchain Observatory and has also vastly increased funding for related technologies.

The post Korona: Hungary’s Very Own Cryptocurrency appeared first on NewsBTC.

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Bitmex: Tether ‘Possibly’ Has Enough Cash Reserves, Could Still Be Shut Down

A report on Tether published by Bitmex Research shows that while it ‘possibly’ has enough fiat reserves, it is at risk of a shutdown by regulatory bodies.

Bitmex Research released an in-depth report on Tether today, Feb. 19, detailing the reasons why Tether is most likely backed by sufficient fiat reserves after all, and what problems with regulatory bodies Tether will most likely encounter in the future.

Tether is a digital token backed by fiat currency, supposedly pegged 1:1 with the US dollar. Due to Tether’s lack of enough publically released bank audits, there are rumors that Tether does not actually have enough fiat in reserves to redeem all Tether tokens with US dollars if the need would arise.

The Bitmex report attempts to refute those rumors by showing a possible correlation between the rising cash reserves of the International Financial Entities (IFE) banking category in Puerto Rico, under a section entitled “The lack of transparency may not indicate fraud.”

Cointelegraph recently reported that Puerto Rico may be emerging as a “crypto tax paradise.”

The Bitmex reports puts forward Puerto-Rican-based Noble Bank as a possible candidate for holding Tether’s cash reserves, mainly because it is the one of the two full-reserve banks in Puerto Rico that publicly operates with crypto.

However, there is no way yet to know for certain where Tether’s cash reserves are located despite the Bitmex report, for although their website’s “Transparency” page lists their current balances and claims they are “regularly audited” and “fully transparent,” the company actually dissolved ties with their New York-based auditor in January before releasing any full audits publicly.

The report also covers the Nov. 2017 hack of around $31 mln from Tether, which led to the company, in essence, demanding users upgrade their software in order initiate a hard fork and freeze the stolen funds.

The Bitmex report writes that this “demonstrated that Tether is effectively in complete control of the ledger, as they can force a hard fork at will and reverse any transaction — although there may not have been any doubt about Tether’s control beforehand.”

The report then questions why Tether “bothers to put the database on the Bitcoin and Ethereum blockchains at all,” arguing that it would be actually more cost-efficient for Tether to not pay miner fees and create its own public database.

The report also brings up the subpoenas delivered to Tether and the Bitfinex exchange in Dec. 2017, after which relationship between the two companies was officially disclosed, i.e. that they have an almost identical management team.

Bitfinex’s involvement with Tether had publicly been questioned by critics, most famously anonymous blogger Bitfinex’ed, who saw the arrangement as suspicious in part due to the fact that no third-party audit has yet been released of Tether’s reserves.

In response to the vitriol against Bitfinex posted online by Bitfinex’ed, the exchange has vowed to pursue legal action.

Bitmex’s research report writes that this relationship between Bitfinex and Tether actually was relatively public even before the temporarily-posted disclosure on Tether’s “About Us” page, citing Tether founder Craig Sellars’ Linkedin, which lists both companies.

The report ends with a listing of case studies of various online money-sending services that have been shut down by regulators over the years due to violations of money-laundering restrictions. This correlation drawn between these now-defunct services and Tether leads Bitmex to conclude that Tether “may also attract criminals and ultimately suffer the same fate.”

Bitmex has two concrete takeaways from their research into Tether, which it also recommends that investors do not hold onto long term:

“1. Reform the system to include KYC/AML procedures that allow the operator to easily block transactions or freeze funds. In order to do this […] Tether would just be turning into a traditional (or full reserve) bank.

2. Continue as is and risk being be shut down by the authorities at some point.”

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Green Mining Company To Reduce Coin Generating Energy Costs By Harnessing Renewable Power

The world’s largest provider of Bitcoin ATMs, intends to lead the way in more sustainable coin generating methods and make it easier for traders to exchange their crypto for fiat.

Mining equipment is available to buy from consumer to professional level, and each of these technologies brings a significant energy cost. In Iceland, the volume of energy used for Bitcoin mining will soon likely exceed the volume used to power its houses, Cointelegraph recently reported. Cointed, the world’s largest provider of Bitcoin ATMs, aims to lead the way in more sustainable coin generating methods.

Bridging the gap between crypto and the real world

By harnessing hydro and wind power, Cointed has pioneered ‘green mining’ with their machines in Austria and Sweden. These mining machines are custom-made and specifically designed for optimum cooling, in order to minimize maintenance (the fans typically found in GPUs have been replaced with heat sinks). The customer then fully owns the hardware. According to the company, by proving it is possible to run these machines solely on renewable energy without losing performance, Cointed have set a precedent for the rest of the crypto world that will hopefully see others follow suit.

This company does not solely provide ATMs (70 machines across four European countries) and mining equipment, however. Cointed claim to be ‘bridging the gap between crypto and the real world,’ making it much easier for traders to exchange their crypto for flat cash. Users can utilize the Cointed site to buy and exchange multiple crypto, at significantly lower prices and with significantly higher levels of security than other providers. The Cointed white paper also states that they provide payment solutions that can be ‘integrated into online shops’ are creating specialized crypto bank cards that will soon be accepted as readily as typical Visa debit cards, and that Cointed is ‘in the final stages of acquiring a banking license.’

Openness and transparency

Detailed information on the workings of Cointed and their roadmap are publicly available in their transparency report. Customers can find all they need to know about Cointed’s business model and team, and how operations are split between multiple countries (Hong Kong, Switzerland, Austria, Turkey, Sweden and more all play a role). The above report is personally introduced by the main team behind Cointed: Wolfgang Thaler, Christopher Rieder, Charlie Aho and Daniil Orlov. Between them, they have decades of IT and crypto expertise, that should ensure smooth running and exciting developments for Cointed going forward.

The Cointed token (CTD) ICO is running for a further two weeks (closes end of February 2017). Aches Wong and Jerry Ng Chien run CTD; another team with extensive crypto experience and knowledge, who can help steer the value of these tokens in the right direction.

Following the ICO, along with the installation of several more ATMs, Cointed plan to successfully apply to become part of the Mastercard and Visa membership.

Cointed already has 15,000 active users of their currency exchange system. It is specifically designed to be user-friendly for even the most inexperienced traders, allowing for a customizable interface depending on the client’s preferences.

Another appealing feature of Cointed is the ability granted to its users to vote on their business decisions. Any CTD token holders (no matter how small the value of their stake) with a verified account will be eligible to vote (on issues such as which cryptocurrency we will next be available on the platform), improving the democracy and transparency of the organization overall.’


Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.

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Bitcoin Marches Over the $11,000 Mark Again – Crypto Resilience

Cryptocurrency trading

This could have been the best possible for Bitcoin to end the week as it climbed above the $11,000 for the first time since the Jan dip which event showcased a speedy sell-off by traders and want-to-be investors.

The violent drop many credit to the tighter regulation fear and rumors of price manipulation that were spreading in the market.

According to CoinMarketCap – Bitcoin reached the level of $11,323 against the US Dollar which zone was touched for the last time in Jan 30.

BTC Trading

As explained in a previous price related writing, the resilience in the leading cryptos is a very supportive factor for investors and enthusiasts to hoist their confidence. BTC was changing hands against the US Dollar in Feb 6 approx at $5,947, which marks an increase of 95.19 percent on its today level.

In South Korea, a key market for bitcoin, there were fears that an outright ban on cryptocurrency trading could come into effect. But as new measures were implemented, they were less strict than investors thought, and many sounded a positive note.

Various figures consider a game changing date when Jay Clayton [chairman of the Securities and Exchange Commission] and Christopher Giancarlo [chairman of the Commodity Futures Trading Commission] gave out a testimony in front of the Senate Banking Committee regarding cryptocurrencies with a positive energy towards the coins advising regulators to have a”thoughtful and balance response, not a dismissive one.”

“We must crack down hard on those who abuse our young enthusiasm for bitcoin and blockchain technology,” he said to the congress. “We owe it to this new generation, to respect their interest in this new technology with a thoughtful regulatory approach,”

Tom Lee, the first major Wall Street strategist to cover bitcoin, said recently that bitcoin will likely rise to $25,000 this year. Kay Van-Petersen, an analyst at Saxo Bank who correctly predicted the cryptocurrency’s rally at the start of last year told CNBC in a recent interview that bitcoin could go to $100,000.

The post Bitcoin Marches Over the $11,000 Mark Again – Crypto Resilience appeared first on Ethereum World News.

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S&P Global Ratings: Crypto Needs ‘Some Rules’ For ‘Future Success’

A report released today from S&P Global rating details the possibilities for the future of cryptocurrency, claiming that retail investors will be most affected if a crash takes place.

S&P Global Ratings released a report Monday, Feb. 19, entitled the “The Future Of Banking: Cryptocurrencies Will Need Some Rules To Change The Game,” that details the possible outcomes for the global financial markets in relation to the actions of the crypto markets.

Even though an early February crash of both the traditional markets and the crypto markets appeared to show synchronicity, Mohamed Damak, S&P Global Ratings financial services senior director, doesn’t see this correlation as meaningful, CNBC reports:

“For now, a meaningful drop in cryptocurrencies’ market value would be just a ripple across the financial services industry, still too small to disturb stability or affect the creditworthiness of banks we rate.”

According to S&P’s report, retail investors, as opposed to banks, would be hit the hardest in the event of a crypto crash:

“We expect rated banks to be largely insulated, given that their direct or indirect exposure to cryptocurrencies appears to remain limited.”

Damak also stressed the importance of regulation in the crypto sphere moving forward:

“We believe that the future success of cryptocurrencies will largely depend on the coordinated approach of global regulators and policymakers to regulate and enhance market participants’ confidence in these instruments.”

The report noted that Blockchain technology could lead to a “positive” disruption of the global financial markets.

Large companies across the globe are already beginning to experiment with Blockchain — Chinese PC company Lenovo recently filed a patent for a Blockchain-based document verification system, and the first major agricultural trade using Blockchain technology was completed in January by sending a shipment of soybeans from America to China.

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