No More Bitcoin for Nordea Bank Employees, Experts Question the Motive

An act of paternalism or a case of generic Bitcoin (BTC) distrust? It is hard to make out the exact reasons for Nordea Bank’s ban on its 31,500 employees trading in Bitcoin or other cryptocurrencies — even on their own time — a prohibition that was upheld on Dec. 2 by a Danish court.

In a press release posted by the court following its ruling, Nordea Bank noted that, “Employees are permitted to keep any existing [crypto] holdings,” though it added that they were encouraged to sell them.

As reported by Cointelegraph, Denmark’s finance industry union, Finansforbundet, brought a class-action lawsuit against Nordea’s cryptocurrency prohibition in 2018 on the grounds that the ban interfered with employees’ personal lives. It appears that the bank, the largest financial group in the Nordic countries (Denmark, Finland, Iceland, Norway and Sweden), was worried that its employees might unwittingly get mixed up with some unethical or even criminal activities. As a spokesperson for Nordea Bank told Cointelegraph after the Copenhagen labor court’s decision:

“The market for crypto-currencies is unregulated and not transparent. It makes it hard to monitor where the money comes from. It increases the risk that investors, including our employees, may unwillingly get involved in activities that are unethical or outright illegal.”

He added that, “We are satisfied that the court ruled in our favour.” In the aftermath of the decision, however, others accused the bank of overreach. Jacob Pouncey, treasurer of the Nordic Blockchain Association, told Cointelegraph:

“It [the decision] is allowing a corporation to impede the private lives of its employees. It is infringing upon the personal freedoms of its employees.”

The bank’s prerogative?

In one sense, there is nothing out of the ordinary in Nordea’s prohibition. Some crypto exchanges have prohibited crypto purchases among employees, and specialized personnel within larger financial organizations, like commodities traders, are often subject to restrictions on their personal assets.

Crypto startup Seed CX, for instance, advertised on its website that it allows: “No personal cryptocurrency trading by employees.” Jeremy E. Deutsch, an attorney from Anderson Kill, told Cointelegraph he doesn’t necessarily see a legal problem with the Bitcoin-trading prohibition, “Clearly banks have the ability to regulate the securities trading of their own employees, and to have all things in place to ensure that they’re not engaging in insider trading.” What’s unusual here, though, is the breadth of the ban. Deutsch said:

“They’ve banned an entire asset class. It’s not like they’re saying, ‘You can’t trade in Amerian Express because we’re doing work for them.’ What they’re saying, rather, is: ‘You can’t own gold. You can’t own oil.’ It doesn’t make sense.”

This sort of prohibition is unique, in the view of Michael Reuter, co-chairman of the Germany-based European Blockchain Association e.V, who told Cointelegraph, “It is highly unusual that a private bank prohibits trading of crypto currencies for all its [31,000-plus] employees. From our experience this could be the first time, ever.”

Nor is this asset class (crypto) so different from more traditional asset classes in terms of risk adjusted returns as measured by Sharpe ratios, added Deutsch. “What exactly is one protecting employees from?” he asked rhetorically. The Danish court’s press release sought to answer the question “Why is Nordea doing this?” with the bank’s own prior statements:

“Investments in cryptocurrency have been restricted due to the unregulated nature of these assets which are not subject to investor protection regulations or authority supervision and related risks including volatility and liquidity risk as well as financial crime risks, e.g. that proceeds that employees might obtain from selling bitcoins derive from criminal activities.”

“The problem with Bitcoins is indeed that they may be used for criminal activities and tax evasion,” Daniël Cuypers, a labor law expert at Belgium’s University of Antwerp, told Cointelegraph. In some cases, the victim may turn to the bank to hold them liable for the acts of their employees.

Related: Criminal Activity in Crypto: The Fact, the Fiction and the Context

But what if the cryptocurrency is purchased outside the job, on the employee’s own time. How does that impact the bank? Cuypers answered:

“This should have no effect on the job. However, it may be that private activities do have negative consequences for the job. It is the impact on the job that matters, e.g., if a bank employee is arrested for financial fraud in private matters it may have a negative impact on the confidence of the [bank’s] clients.”

Nordea argued that its employees “may unwillingly get involved in activities that are unethical or outright illegal activities” if allowed to purchase cryptocurrency on their own time. What’s wrong with that? In Pouncey’s opinion, “Sure the bank has a point, but why not ban any other activity that could lead to unethical or downright illegal activity, such as buying fur coats, drinking, gambling, and other vices.”

Reuter from the European Blockchain Association challenged the notion — presumed by Nordea and held by many others as well — that Bitcoin is an effective means of payment for criminal activities:

“Because Bitcoin is not an anonymous, but a pseudonymous crypto asset, it would be unwise to use it for criminal activities. From the perspective of a criminal: he or she can easily be traced back. In principal, this argument seems to reflect a generic distrust of Bitcoin rather than a comprehensible counter-argument.”

Hostile to crypto?

There is some history here. According to Compliance Week, Nordea Group changed its strategic focus in 2014 from the Baltic states to the Nordic states “in part over concerns it was being used by its international branch customers to launder dirty money.” It had reportedly been under investigation for three years for handling illicit funds tied to Russian criminals.

In June, Nordea Bank Danmark A/S announced that its offices had been raided by Danish prosecutors under suspicion of money laundering. The bank reportedly set aside more than $106 million to cover money laundering probes. Last week, some in the crypto community seemed to feel that Nordea’s employees were paying for the bank’s transgressions. As Pouncey told Cointelegraph:

“Nordea has been connected to hundreds of millions of dollars worth of suspicious money flows. Would you say any employee working at the bank is directly or indirectly engaging in unethical or outright illegal activities simply by doing their daily task that keeps the bank running? The bank should focus on policing its own unethical or outright illegal activities first, then focus on its employees’ actions outside of work.”

An analyst that goes by the name “Rhythm” had this comment on Twitter in the wake of the court ruling on Dec. 2, “They told their staff that ‘the risks were too high.’ This is coming from the same bank that was raided by police for allegedly laundering $793 million of Russian money.”

“The crypto industry is lurching slowly toward greater regulation, oversight and transparency,” Deutsch told Cointelegraph, so for the bank to argue that it needed to protect its employees and protect itself against an unregulated, opaque market doesn’t really hold water (though that claim might have had merit three years ago, he allowed).

Deutsch added, “They are within their rights, but to prohibit every single employee from trading cryptocurrencies — including the janitors and people who work in the cafeteria — seems weird.” Pouncey told Cointelegraph that the bank may have gone too far:

“Owning crypto is not illegal in Denmark, nor is purchasing it. Yet because I work at a bank that has been suspected of laundering millions annually, I am unable to purchase cryptocurrencies despite studies showing that only a small volume of crypto transactions are actually for illicit purposes.”

The Danish court’s decision will likely be appealed, Pouncey said. This ban is impossible to enforce — a Nordea employee could buy crypto with cash or from an account outside of Nordea field of vision — “however, it will deter people,” he said. Nordea clearly overreacted, in the view of Reuter:

“Cryptoassets are in most cases unregulated assets that should be addressed in the same way as other unregulated assets. That said, we don‘t regard this decision as a watershed event in the way that more or many banks will follow.”

Overall, a benevolent reading of Nordea’s controversial Bitcoin prohibition is that it is a bit clumsy and paternalistic — protecting its employees from themselves, as it were. The darker view is the bank is using crypto as a scapegoat for its legal transgressions.

Ethereum Istanbul Hard Fork Get Support From Major Crypto Exchanges

Following the successful Ethereum Istanbul hard fork update, several popular exchanges have announced their official support for the network upgrade.

Yesterday, on Dec. 7, the Ethereum’s network saw ample collaboration between node operators and miners to update the software to support the Istanbul hard fork.

Some crypto exchanges even sounded their willingness to update a few days prior to the scheduled hard fork.

A widely supported hard fork

Notably, Binance announced support for the upgrade on Dec. 5 and the day afterwards its U.S. subsidiary did the same. Coinbase also tweeted yesterday that Ethereum and ERC20 deposits and withdrawals have been resumed on its trading platforms and the node upgrade has been completed.

The website dedicated to reporting the state of Ethereum support of crypto exchange Kraken also suggests that the firm has undergone scheduled maintenance to update the nodes. While the Poloniex exchange has announced their support on twitter.

Bitfinex, the cryptocurrency trading firm with close ties to stablecoin operator Tether, also announced on Dec. 6 that it planned to support the hard fork.

Overall, the hard fork has seen widespread adoption by the community and not major negative events have been reported. This hard fork also included the previously discussed Muir Glacier hard fork, meant to address the so-called Ethereum Ice Age.

Ethereum Hard Fork Live, Stolen ETH Moved, ‘Hodlers Are Insane’: Hodler’s Digest, Dec. 2–8

Coming every Sunday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link.

Top Stories This Week

Ethereum completes Istanbul hard fork

It’s happened! Ethereum’s much-anticipated shift to Istanbul has been completed, and the system-wide update came into force when the network passed block #9069000 late on Saturday night. Vitalik Buterin claims capacity now has the potential to reach 3,000 transactions per second. Istanbul is designed to deliver interoperability with the privacy token Zcash and make it cheaper to use zero-knowledge technologies that enhances privacy. Although miners and node operators need to update their client, most people who hold ETH or use the network are unaffected — and ETH prices are unexpected to suffer turbulence. Maxwell Foley, software engineer at CertiK, told Cointelegraph Magazine: “Ethereum, in general, is an exciting project because they’re trying the hardest out of anyone in the crypto space to scale without sacrificing decentralization.”

Upbit hack: Stolen ETH worth millions on the move to unknown wallets

There’s been some new developments after 342,000 ETH was stolen from the hot wallet of major South Korean crypto exchange Upbit. According to Whale Alert, a service monitoring large transactions, one of the addresses involved in the theft has been moving ETH worth millions of dollars to an unknown wallet. Dodgy transfers have been taking place throughout the week in chunks of 10,000 ETH and 1,001 ETH — worth about $1.5 million and $150,000 respectively. After news emerged that the funds, worth about $50 million, had been stolen, some analysts suggested that an “inside job” was more likely than an external breach.

France to test its central bank digital currency in Q1 2020, official says

The Bank of France is going to test a central bank digital currency for financial institutions in the first quarter of 2020. Governor François Villeroy de Galhau said the “digital euro” pilot will not involve retail payments made by individuals — and stressed any such project would “be subject to special vigilance.” The central bank has been clear that France needs to assert sovereignty over private initiatives such as Facebook’s Libra, with the country leading efforts to ensure that the stablecoin is stopped from launching on European soil. The governor has also spoken of his enthusiasm for being the first country in the world to issue a CBDC, allowing France to become an example to other jurisdictions.

“Hodlers are insane” — 64% of Bitcoin supply has not moved since 2018

Given we are, er, Hodler’s Digest, let’s give you some holding news. New research has suggested that a whopping 60% of BTC in circulation hasn’t left its wallet in more than a year. This is particularly telling since BTC/USD ballooned from lows of $3,100 last December to $13,800 just six months later. Markets subsequently reversed downward — shaving 52% off their highs. Rhythm, the analyst who uploaded the statistics, didn’t mince his words by saying: “Hodlers of last resort are insane.” With the trend of dormant BTC as a percentage of total supply sharply increasing in recent years — and remaining intact during bull and bear markets alike — it seems many investors want to save it rather than spend it.

Deutsche Bank research: Crypto to replace fiat currencies by 2030

New research by Deutsche Bank has revealed what the future might look like for crypto in just 10 short years. Its report suggests that digital currencies could eventually replace cash one day, as demand for anonymity and a more decentralized means of payment grows. Hurdles do lie in the way — and the authors say digital assets will need to gain legitimacy in the eyes of governments and regulators for wider acceptance to be achieved. The report also warns that the risk of cyberattacks and digital warfare could also pose huge risks to the stability of financial systems based on digital currencies in the future.

Winners and Losers

At the end of the week, Bitcoin is at $7,602.68, Ether at $150.47 and XRP at $0.23. The total market cap is at $205,799,442,442.

The top three altcoin gainers of the week are Energi, HedgeTrade and Enjin Coin. The top three altcoin losers of the week are ILCoin, Silverway and Thunder Token.

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For more info on crypto prices, make sure to read Cointelegraph’s market analysis.

Most Memorable Quotations

“Free Ross, baby! Get him out. We need entrepreneurs like that guy! Get him out of jail! Why do we put these really extraordinary people in jail? We need their minds, their energy, their life force. Get him free. Who knows what else he could’ve come up with?”

Tim Draper, investor

“In Japan, the amount of cash outstanding is still increasing, and it does not seem that there is a demand for CBDC from the public at present.”

Haruhiko Kuroda, Bank of Japan governor

“Turkey is a vibrant country that has illustrated one of the strongest demands and fast-growing interest in crypto.”

Changpeng Zhao, Binance CEO

“Hodlers of last resort are insane.”

Rhythm, analyst

“Bitcoin halving in May 2020 won’t do anything to the price. It will be a non-event.”

Jason Williams, Morgan Creek Digital co-founder

“Chair Powell and I have discussed this — we both agree that in the near future, in the next five years, we see no need for the Fed to issue a digital currency.”

Steven Mnuchin, U.S. Treasury Secretary

Prediction of the Week

Halving will be “non-event” for BTC price, Morgan Creek Digital exec says

“The halvening” in May 2020 — when the reward paid to miners falls from 12.5 BTC to 6.25 BTC per block — is widely regarded as an event that will catalyze a bull market. But according to Jason Williams, the co-founder of Morgan Creek Digital, these expectations might be overblown. He believes that the having will have no impact whatsoever on BTC prices, describing it as a “non-event.” With analysts bitterly divided over whether there will be a bull run — and if so, how quickly a reaction will take place — expect many more wild predictions to grace this column in the weeks and months to come.

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FUD of the Week

Canada-based crypto mining firm Great North Data files for bankruptcy

Great North Data, a crypto mining company based in Canada, has filed for bankruptcy. The firm operated facilities in Labrador City and Happy Valley-Goose Bay. Bankruptcy documents show that it had $13.2 million in liabilities but just $3.5 million in assets. Reports suggest that the company owed six-figure sums to government bodies. It’s been a difficult time for mining companies, with Washington-based Giga Watt closing down in January because it was “insolvent and unable to pay its debts when due.”

Researchers detect new North Korea-linked MacOS malware on crypto trading site

Security researchers have uncovered cryptocurrency-related macOS malware that is believed to be the work of North Korean hackers known as the Lazarus Group. It is believed that the malware can retrieve a payload from a remote location and run it in memory — something that is not common for macOS. This resultantly means it can be difficult to detect the malware and carry out forensic analysis — with only 10 antivirus engines actually flagging it as malicious. “Clear overlaps” have also been found with malware that was detected by another group of security researchers in the middle of October.

CT News of the Week

Cointelegraph announces Chinese HQ, bolstering its international expansion

A little news about us now, if you’ll indulge me. Cointelegraph has launched a Chinese-language version of the publication — with offices in Guangzhou, Beijing and Shanghai. The venture has been co-founded by Vadim Krekotin, Kevin Shao and Simon Li, and the team says they are determined to produce the highest-quality journalism for readers in China — ”holding steadfast to the values of editorial independence and responsibility to our readers.” Cointelegraph China is now our third base in Asia, joining local news sites serving Japan and Korea. 

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Best Cointelegraph Features

Ethereum’s Istanbul hard fork: Important updates, explained

Bamboozled by news of Ethereum’s latest hard fork? This nifty feature from Cointelegraph Magazine explores what forks are for, the structure of Ethereum’s roadmap, and delves into the details of the changes that Istanbul has delivered.

Death spirals and BTC — What happens when miners capitulate?

Miner capitulation occurs in the Bitcoin market when mining is no longer profitable — and it is believed to have triggered BTC’s major drop in December 2018. Joseph Young explores the phenomenon in depth here, and looks at what might happen in the months to come.

CryptoBridge closes down and Waves relaunches, DEXs face tough times 

With one decentralized crypto exchange abruptly shutting shop — and another undergoing a radical restructure — Stephen O’Neal looks at whether crypto trading platforms have something to worry about.

Ethereum Price Stable Despite Hard Fork, Altcoins See Small Gains

Sunday, Dec. 8 — most of the top 20 cryptocurrencies are reporting discreet gains on the day by press time, as Bitcoin (BTC) hovers around the $7,550 mark again.

Market visualization courtesy of Coin360

Bitcoin price is currently down by 0.2% on the day, trading at around $7,552 at press time, according to Coin360. Looking at its weekly chart, the coin is up by about 2.91%.

Bitcoin 7-day price chart. Source: Coin360

On Dec. 6, cryptocurrency market analyst Alex Thorn pointed out on Twitter that the total number of on-chain Bitcoin addresses holding any amount of Bitcoin hit a new record of 28.39 million.

Ether (ETH) is holding onto its position as the largest altcoin by market cap, which currently stands at $16.3 billion. 

Coin360 data shows that ETH has seen its value increase by about 0.11% over the last 24 hours. At press time, ETH is trading around $150. On the week, the coin has also gained about 1.35% of value. 

Overall, the price of the coin seems completely unaffected by the upgrade to its software introduced by the recent hard fork. Some members of the cryptocurrency community express confusion and surprise over the lack of reaction on the asset’s price part on Twitter:

“I really don’t understand ethereum doesn’t go up today.”

Ether 7-day price chart. Source: Coin360

XRP is up by about 0.69% over the last 24 hours and is currently trading at around $0.227. On the week, the coin is up about 3.18%. Ripple’s XRP is currently the second-largest altcoin, has a market cap of $9.9 billion at press time.

XRP 7-day price chart. Source: Coin360

Among the top 20 cryptocurrencies, the only one reporting double digit gains is Algorand (ALGO), which has seen its value increase by about 10.46% over the 24 hours to press time.

At press time, the total market capitalization of all cryptocurrencies is $204.8 billion, about 2.4% higher than the value it reported a week ago.
 

Keep track of top crypto markets in real time here

Death Spirals and BTC — What Happens When Miners Capitulate?

The stagnation of the cryptocurrency market has put Bitcoin’s (BTC) price at risk of further decline, as it struggles to recover beyond key resistance levels. A descending price increases the probability of the so-called “miner capitulation” occuring, which is said to have triggered the major BTC drop in December 2018.

Late last year, the Bitcoin price fell to around $6,000 following three months of stability in a tight range between $6,000 and $6,500. The subsequent drop to the $3,000s happened within the span of just one month.

Why miner capitulation occurs?

Miner capitulation occurs in the Bitcoin market when mining is no longer profitable. As profitability drops, miners naturally sell their Bitcoin holdings, capitulating as a response to worsening market sentiment. If miners begin to sell off, it creates significant selling pressure in the market. Such pressure creates a difficult environment for major cryptocurrencies like Bitcoin to maintain their momentum.

Large mining centers and companies are unlikely to capitulate due to a short-term price slump, as they hold long-term contracts with electricity providers. They also have more capital to deal with instability in the market for an extended time period.

Meanwhile, short-term capitulation among smaller mining companies is likely. Major mining firms closing down one after another could lead to a death spiral in which the Bitcoin network’s hash rate drops to near-zero.

However, as security and cryptocurrency researcher Andreas Antonpoulos previously said, a death spiral or an abrupt drop in the hash rate of the Bitcoin network to near-zero is not likely to happen because miners operate with long-term perspective and strategy. He explained, “Part of the reason that’s unlikely to happen is that miners have a much more long-term perspective.”

Hence, when short-term miner capitulation occurs — similar to late 2018 — the market tends to recover in six months to a year. Currently, it is still premature to predict whether miner capitulation will occur heading into the year’s end. However, if negative sentiment around the market is carried onto the first quarter of 2020, a December 2018-esque capitulation could occur in the upcoming months.

Bearish targets for Bitcoin

Prior to last week, when the Bitcoin price was clearly in an intense downtrend following a brief spike to $10,600 on Oct. 26, many technical analysts predicted a further drop to the $5,000 to $6,000 region.

Crypto trader Eric Thies, for instance, said last week that a key bearish indicator lit up, noting that Bitcoin is due for a deep pullback in the near future. Subsequent to an awkward price action for over two weeks, during which Bitcoin demonstrated extreme volatility, Thies said that BTC could be setting up for a recovery after tweeting on Dec. 1 that the outlook was not great. The analyst emphasized that the current structure is “potentially significant for bulls,” not dismissing the scenario of BTC rebounding strongly to higher resistance levels.

DonAlt, a cryptocurrency trader, said that while it is too early to state that Bitcoin is on track for a full recovery, it would have to reclaim higher time frame levels to engage in any meaningful upside movement.

Higher time frame resistance levels for Bitcoin sit between $7,600 and $8,500, and according to DonAlt, BTC passing those levels in the short-term would indicate a bullish movement. He said, “Now that heads have cooled off, the bullishness has quickly faded. So far, this is a bearish retracement after a huge impulse down.”

Big mining companies are having a difficult time

The break-even price of Bitcoin mining is estimated at around $4,100 to $4,500. According to Miner Hut8, a publicly listed mining giant based in Canada, the firm has mined Bitcoin at a cost of $4,300 throughout the third quarter. The company stated:

“Revenue of $26.7 million; Mining Profit Margin of 58%, and Adjusted EBITDA of $14.7 million. Mined 1,965 Bitcoin at a Cost per Bitcoin of US$4,363 inclusive of electricity costs, mining pool fees, and all other production costs.”

However, cryptocurrency researcher Ceteris Paribus noted that the cost of mining calculated by Miner Hut8 “leaves out depreciation, expenses, and net finance expenses,” which could place the actual cost of mining at $7,100. The researcher added:

“Short-term if the price goes under $7.1k they will keep mining as this is still > operational costs & mining equipment is a sunk cost. But long-term you can’t imply that they are profitable <$5k. They will need to replace equipment, continue paying employees, financing costs, etc.”

The decline in Bitcoin’s price and the increase in mining difficulty has had a negative effect on the mining profit margins of Hut8 as well as other major mining firms. Due to their large Bitcoin holdings and cash reserves, large mining facilities are not at imminent risk of having to reduce their operations to cope with a declining Bitcoin price.

Still, the tough ecosystem developing before miners could take a toll on smaller firms, especially if BTC falls to the $6,000s, a price range that is below the break-even point for most producers.

Halving won’t have an immediate effect

One of the most highly anticipated events of 2020 is the block reward halving of Bitcoin in May. The mechanism, which gets triggered once every four years, would effectively drop the compensation miners receive for mining blocks that contain BTC transactions by half. It also decreases the rate of new BTC production as the network approaches its fixed supply of 21 million Bitcoins.

Since 2018, the halving has been talked about as the next driving factor of an extended Bitcoin rally. As a scarce asset, any event that decreases the supply of the cryptocurrency would theoretically impact its price trend. However, high profile investors have said that the halving is not likely to have any immediate effect on the Bitcoin price.

Related: BTC Miners: No More Basement Rigs, Greater Profits to Come

If the halving occurs without imposing a positive impact on the price of Bitcoin, it would place additional pressure on miners to adopt better infrastructure and efficient equipment to try to further decrease the costs.

Throughout history, the halving has not led to a large rally for Bitcoin until a year or two after the event, possibly because it is priced in well before the event occurs. As such, it is possible that the capitulation of small miners lead to BTC testing lower level supports in the $5,000 to $6,000 region despite being down substantially since mid-2019, creating negative sentiment around the cryptocurrency market in early 2020.

The current price trend of Bitcoin

Based on fundamentals, Bitcoin remains strong in various key areas including user activity, transaction value denominated in dollars, and hash rate. Official on-chain data from Blockchain.com shows that the number of unique addresses used has increased from 310,000 in January 2019 to nearly 500,000 in less than 12 months. The hash rate has also increased, from 41 exahash in January to 92 exahash, more than doubling in the same period.

Bitcoin network hash rate. Source: blockchain.com

Due to the fundamentals, Bitcoin investor Timothy Petersen said that the “2019 bubble” of Bitcoin is likely to burst in about two weeks, marking a potential local bottom by year-end. Hence, if BTC begins to demonstrate an intense sell-off in the weeks to come, the most probable cause of the drop would be capitulation by smaller mining firms. Mining capitulation is also seen as a positive point for medium to long-term recovery by many investors, as it often marks the end of a bear market and the start of an accumulation phase.

EOS-Based Social Media Platform Voice Announces Beta Launch

Voice, the social media platform first unveiled by EOS creator Block.One in June, announced that it will launch in beta on Feb. 14 — Valentine’s Day — in 2020. Voice announced the beta launch date in a blog post published by the project on Dec. 5. The firm also promises that it will share its progress with the community as the development goes on. 

Voice also claims that thousands have already signed up to take part in its beta testing. The firm also admits that the initiative is still plagued by regulatory uncertainty and that it is still working with regulators to ensure compliance.

What’s new in Voice?

The platform also plans to “cycle value” back to the users in the form of its own tokens. Overall, the firm presents itself as a social platform aiming to solve the problems afflicting its already active counterparts, such as data auctioneering and hidden algorithms. Voice claims that the initiative will attempt to solve the interest misalignment afflicting current platforms:

“We believe Voice is social as it should be — where what’s good for the platform is also good for you.”

The problem with current social media

The blog post also explains the motivation behind the project’s development and cites an explanation of Block.One chief technical officer Dan Larimer which was issued about half a year ago to an audience in Washington D.C. The author of the post summarized what was said in the following way:

“Social media is broken. Designed to use us, our data and attention is harvested into trillion dollar profits, while we struggle to protect ourselves against the consequences of having our attention auctioned to anonymous parties, and our personal information traded on the open market.”

During the event, Larimer also explained that such a misalignment of interest between the platforms and its users increasingly exposes the public to data profiling, identity theft, cyberbullying, and persuasive misinformation. According to him, manufactured propaganda aiming to manipulate public opinion, which flourishes on social media platforms, makes it harder than ever to know what is real.

As Cointelegraph illustrated in a dedicated analysis in early October, blockchain is often proposed as a solution to the increasing spread of false information. Furthermore, blockchain and decentralization have been long proposed as solutions for many of the issues plaguing the current social media platforms.

One of the last examples was unveiled in October, when reports suggested that a Yale professor and Goldman Sachs veteran were planning a new blockchain-based rival to Facebook in 2020.

Bitcoin Hovers Under $7,550 as Altcoins See Moderate Gains

Saturday, Dec. 7 — most of the top 20 cryptocurrencies are reporting moderate gains on the day by press time, as Bitcoin (BTC) hovers just under the $7,550 mark again.

Market visualization courtesy of Coin360

Bitcoin price is currently up by 2.12% on the day, trading at around $7,537 at press time, according to Coin360. Looking at its weekly chart, the coin is down by about 1.71%.

Bitcoin 7-day price chart

Bitcoin 7-day price chart. Source: Coin360

Earlier today, on-chain analyst and trader, Willy Woo, said on Twitter that he believes that Bitcoin’s on-chain momentum is becoming bullish. He suggests that investors are preparing for halvening front running.

Ether (ETH) is holding onto its position as the largest altcoin by market cap, and currently stands sits at $16.3 billion. The second-largest altcoin, Ripple’s XRP, has a market cap of $9.8 billion at press time.

Coin360 data shows that ETH has seen an increase in value about 0.4% over the last 24 hours. At press time, ETH is trading around $150. Over the past week, the coin has lost about 2.59% of its value. 

Ether 7-day price chart

Ether 7-day price chart. Source: Coin360

XRP is up by about 1.55% over the last 24 hours and is currently trading at around $0.225. On the week, the coin is down by about 0.87%.

XRP 7-day price chart

XRP 7-day price chart. Source: Coin360

Among the top 20 cryptocurrencies, the one reporting the highest gains is Tezos (XTZ), which has grown by almost 10% over the 24 hour period.

At press time, the total market capitalization of all cryptocurrencies is $204.8 billion, about 1.92% lower than the value it observed a week ago.

Keep track of top crypto markets in real time here

SEC Requests UK’s Intervention to Force Telegram’s Former Advisor to Testify

The United States Securities and Exchange Commission (SEC) asked the High Court of England and Wales to force Telegram’s former chief investment advisor John Hyman to testify in the case over the firm’s Grams tokens offering.

Industry news outlet Coindesk reported on Dec. 7 that the SEC’s request was revealed by documents filed by the regulator with the U.S. District Court for the Southern District of New York yesterday. 

Security or not?

As Cointelegraph previously reported, the SEC is convinced that Telegram’s Grams tokens are unregistered securities. According to the regulator, Telegram claimed that its Grams Purchase Agreements but did not claim the same about the actual tokens. Furthermore, “in any event, the exemption from registration under Regulation D is not available to Telegram.”

Per the filing, the SEC is looking to obtain Hyman’s testimony because of his involvement in Telegram’s fundraising efforts. He reportedly communicated with “over a dozen” investors of the firm’s Telegram Open Network (TON). According to the documents, Telegram CEO Pavel Durov defined him in January last year as the person who “runs the distribution of Grams.”

The U.S. regulator requested the U.K.’s authorities to issue a Letter of Request for Hyman’s deposition, given that he is a United Kingdom’s citizen and resides there. According to the filing, the SEC attorney previously contacted Hyman’s counsel and Hyman agreed to appear for a voluntary deposition.

Still, later Hyman’s counsel allegedly “refused to return multiple phone calls and emails regarding Mr. Hyman’s deposition.” Other than his testimony, the SEC is also looking to obtain copies of Hyman’s written communications with Telegram’s leadership and investors, documents about his employment at Telegram and his own investment in grams. 

As Cointelegraph reported at the end of November, a United States federal judge has preserved the SEC’s move to strike Telegram’s defence “for vagueness/lack of notice.”

Jared Leto invested in Telegram’s TON?

The documents also contain email exchanges between Durov and potential Grams token buyers. Interestingly, this includes communications with Kleiner Perkins’ partner Mamoon Hamid, who was introduced to Durov by a person named Jared Leto.

While it is unclear whether the person is the popular singer and actor himself, he used an email address hosted on the celebrity’s official domain jaredleto.com.

Report: ‘Blockchain Is A Rapidly Maturing Technology in China’

According to a report by Forkast Insights, the research arm of Asia-based Forkast, blockchain is a rapidly maturing technology in China, “far beyond the experimental stage.”

Forkast Insights, the research arm of Asia-based Forkast, took an in-depth, comprehensive look at how blockchain technology is integrated in China.

On Dec. 5, Forkast Insights presented its first report on how blockchain is being applied by the Chinese government and companies across the country. According to the report, blockchain technology is rapidly maturing and has a slew of “real-world, practical use cases that are far beyond the experimental stage.”

Forkast Insights included the in-depth analysis and insights from top China-based blockchain insiders, academics, and leaders to see how one of the world’s largest economy is experiencing this innovative technology.

The report takes a closer look at how blockchain implementation in China compares to the rest of the world, how firms use blockchain and how Chinese consumers experience it in their daily lives, how China takes the lead in the blockchain patent race, and how The People’s Bank of China is racing to launch a digital token to challenge the United States dollar, among others.

China on its way to dominate blockchain innovations

In November, Cointelegraph reported that China’s blockchain development will see a compound annual growth rate of 65.7% from 2018 to 2023, and that the technology will exceed $2 billion by the end of 2023.

With China president Xi Jinping’s recent call to embrace blockchain technology, the country is well on its way to take the number one spot in dominating blockchain innovations and overshadow the U.S., which is apparently lagging behind quickly.

Xi identified dozens of practical use cases that should be promoted: loans, health care, anti-counterfeiting, charity and food security, while he emphasized that blockchain development could help China to “gain an edge in the theoretical, innovative and industrial aspects of this emerging field.”

Big leaps for blockchain in China

The adoption of blockchain has found solid ground in China, with the government attaching a high level of importance to the digital economy. The cautious but promising endorsements are signs that the Chinese government is indeed considering further implementation of blockchain technology throughout the country.

Even the Chinese army is now reportedly thinking about using blockchain technology to aid its military, by implementing the technology to reward the workforce and manage personal data.

Ukraine Passes Law on Money Laundering With Crypto Policy Based on FATF

The Ukranian government has approved the final version of a money laundering law that will handle virtual assets and virtual asset service providers (VASPs) per FATF guidelines.

On Dec. 6, the Rada, Ukraine’s legislative body, published a final version of the law that considers virtual assets to be a store of wealth, while also recognizing its potential use in financial crimes, such as money laundering, fraud, and the financing of terrorists.

Applying verification to both sender and receiver

The new law includes some guidelines on how the government intends to monitor and regulate the trading of cryptocurrencies. One of the guidelines focuses on individual crypto transactions worth less than 30,000 hriven ($1,300), from which the government will only collect the public key of the sender for the purpose of financial monitoring. 

However, once the transaction exceeds that amount, the government will apply verification to both sender and receiver. The process will include identity verification, as well as the verification of the nature of the business relationship.

For VASP’s the threshold sits above the 40,000 hryvnya ($1,600) price level. In that case VASP’s should provide the authorities with information when traders are registered in jurisdictions that do not comply with anti-money laundering recommendations, when traders are family members, when traders are foreigners, and when cash transactions occur.

Konstantin Yarmolenko of Blockchain4Ukraine provided Cointelegraph with guidance on Ukrainian law in this sector. 

Binance helps Ukraine to prepare crypto legislation

Major global crypto exchange Binance is reportedly collaborating with Ukrainian authorities to establish cryptocurrency-related legislation in the country. Binance signed a memorandum of understanding with the Ministry of Digital Transformation of Ukraine to jointly work on the legal status of cryptocurrencies. Binance CEO Changpeng Zhao (CZ) said in November that the legalization of cryptocurrencies and the adoption of progressive legislation can play a key role in bringing positive growth in the economy as well as attract additional investments.

As part of the agreement, the Ministry and Binance intend to form a working group focused on the strategy of blockchain implementations as well as the creation of “new virtual assets and virtual currencies market in Ukraine.”

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