Japanese Regulators Tighten Grip on Crypto Exchanges & Privacy Coins
Japan’s Financial Services Authority (FSA) has set out new rules for domestic cryptocurrency exchanges.
In what could be linked to Coincheck’s crypto exchange hack in January, the FSA is intensifying efforts to prevent another hack. Japan has been hit with the two of the biggest hacks in the history of cryptocurrencies. First it was Mt. Gox, and more recently Coincheck – where $532 million was stolen.
A source in the FSA told local news outlet Nikkei Asian Review that there have been challenges in identifying potential risks before they happen. Quoting the source, the outlet reports that “without the necessary know-how, we've been feeling our way through the dark on how thoroughly we should check these different aspects.”
As part of the new framework, investors need to be protected and there is a need to rework the current internal managements systems of exchanges.
The new rule involves closer and more meticulous daily monitoring of customer accounts by exchanges. Exchanges are required to look out for suspicious transactions and fluctuations in customer accounts. Additionally, customer assets should be managed separately from those of the exchange, while storing crypto holdings in an offline system. As expected, in order to follow the money trail, customers will be subject to stricter Know Your Customer (KYC) and Anti-Money Laundering (AML) checks.
Privacy coins like Dash (DASH), Monero (XMR), and ZCash (ZEC), amongst others are now banned from government-registered exchanges.
To ensure that these new rules are adhered to, the FSA will be sending inspectors to both new and existing exchanges to check compliance.
Rising Battles for Ethereum: Scaling or Regulations?
Ethereum founder, Vitalik Buterin has hinted on a possible increase in the transaction processing capacity of the network, by implementing the sharding scaling improvement. Ethereum currently has the capacity to handle 15 transactions per second.
In a tweet dated 30th of April, Buterin noted:
“Sharding is coming”.
Sharding involves dividing the workload or size of a transaction to multiple computers. This way, more can be done within the same period of time, thus increasing the number of transactions a blockchain can process.
In a series of tweets that followed after, Buterin outline a proof of concept for implementing the tech. He wrote:
“I would not say the spec is finalized at this point, though the ‘bag of ideas’ is IMO pretty well-established. The latest research consists of combining together existing ideas about scaling and latency (i.e. block time) reduction.”
In another news, Ethereum, the second largest cryptocurrency by market cap has come under serious scrutiny from American regulators. The US Securities and Exchange Commission (SEC) and the Commodity Futures Exchange Commission (CFEC) are having a closer look on the crypto’s token presale in 2014.
These regulators are concerned whether the token presale which raised 31,000 BTC, valued at $18.3 million could be classed as a security sale. This is because investors may have bought ETH tokens with the hopes that their value would increase in the future. SEC and CFEC regulators are scheduled to meet May 7 to discuss a possible course of action.
However, Ethereum Foundation co-founder, Joseph Lubin has refuted claims that Ethereum should be classed as a security. He noted that:
"We spent a tremendous amount of time with lawyers in the US and in other countries, and are extremely comfortable that it is not a security; it never was a security… many regulators that matter understand what Ethereum is.”
User Safety: Russian Crypto Blogger Found Dead
In a rather sad turn of events, Russian crypto blogger and investor, Pavel Nyashin has been found dead in his apartment.
Earlier this year, the 23-year old was assaulted in Leningrad Oblast after he boasted of his crypto wealth, online. Masked assailants were able to steal 2 million rubles in cash from the youngster.
Following his attack, Nyashin moved to his mother’s apartment in St. Petersburg. However, he was found dead on the 3rd of this month. Investigations are on the way to confirm if his death is in any way related to his crypto holdings.
It is important to note that this is not the first-time cryptocurrency-related attacks have been carried out. In February, creator of PRISM, Yury Mayorov was kidnapped in Moscow. He was robbed of 300 BTC, valued at $3 million then, as well as $20,000 in cash.
Cardano to Partner with Ethiopia to Introduce Blockchain In Agritech
The cryptocurrency space in general has recorded some significant adoptions and partnerships. This time, the government of Ethiopia has signed an MOU with cryptocurrency Cardano (ADA). The MOU will allow Ethiopian developers to apply blockchain tech to the country’s agritech niche.
Charles Hoskinson, CEO and founder of Cardano confirmed this in a tweet:
“Just signed an MOU with the Ethiopian Ministry of Science and Technology to explore training blockchain developers and use Cardano in the Agritech Industry.”
Developers are expected to start using Cardano’s platform by the end of 2018.
PwC to Integrate Vechain: Purchases Stake in Project
Multinational audit and consultancy firm, PricewaterhouseCoopers (PwC) has purchased a small stake in Chinese blockchain project, VeChain. VeChain aims to combat counterfeiting, while integrating the Internet of Things (IoT).
PwC hopes to integrate VeChain’s service into its infrastructure, while VeChain will enjoy an increased audience in Hong Kong and Southeast Asia. It’s a win-win for both parties.
Trademark Case: Alibaba Vs. Alibabacoin
US District Judge, Paul Oetken has rejected Alibaba’s trademark lawsuit against Alibabacoin Foundation. According to the judge, "Alibaba fails to cite a single case in which a court has concluded that an agreement with a third-party web-hosting company in New York bears an articulable nexus to a trademark infringement claim involving a website.”
A temporary restraining order which was placed on the blockchain project was released, with the judge stating that: "Alibaba has not met its burden to establish a reasonable probability that the Court has personal jurisdiction over Alibabacoin."
Alibaba will however have none of this as they told CoinDesk that they will file a new motion against the foundation.
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