Bitcoin-based security token offering approved in Germany

German financial regulators have approved a security token offering (STO) based on a Bitcoin (BTC) sidechain.Germany’s Federal Financial Supervisory Authority (BaFin) has greenlighted the EXOeu token by game publisher Exordium, making local retail investors eligible to participate in the sale on Stokr, a major European digital marketplace.German investors can invest in EXOeu via Stokr with a minimum investment amount of $100. EXOeu is the second STO ever approved for the German market on Stokr after BaFin approved an STO by parking network ParkinGO last year.Launched in January 2021, the EXOeu security token is raising funds for the development of Samson Mow’s sci-fi MMO game Infinite Fleet. The offering has been available for investors in other European countries lik France, Luxembourg, Spain, Portugal, raising more than $7 million to date.While many STOs are based on the Ethereum blockchain, the EXOeu token is issued via Blockstream Amp, a platform for tokenizing securities built on the Liquid sidechain of Bitcoin.“Bitcoin is shaping payments, and it’s about time it shaped capital markets — this can be done via layer two technologies,” Stokr co-founder Arnab Naskar said, adding that Ethereum is “losing its charm” as an STO platform due to high gas fees and the uncertainty around Ethereum 2.0.Related: Bitfinex launches security token platform regulated in KazakhstanAccording to Stokr co-founder Tobias Seidl, BaFin’s approval of Exordium’s STO marks a new milestone in cross-border blockchain-based STOs. “We see Bitcoin as a fundamental backbone of the future capital markets, which will be built on blockchains,” he said.The news comes shortly after major crypto exchange Bitfinex announced last week that it would debut its own STO trading platform with Exordium (EXO) trading.

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Bitcoin sees ‘quite healthy’ consolidation on $200M BTC options expiry day

Bitcoin (BTC) ranged around $48,000 on Friday as hopes of a bull run endured thanks to low supply and upcoming corporate disclosures.BTC/USD 1-hour candle chart (Bitstamp). Source: TradingViewAnticipation builds for cross-crypto breakoutData from Cointelegraph Markets Pro and TradingView showed BTC/USD continuing to consolidate into Friday, with the latest options expiry now due.The pair had made little progress since bouncing off $47,000 the day before, but bullish expectations among analysts were also firmly intact.As Cointelegraph reported, these revolve around a “supply squeeze” driving prices up — a combination of increased demand while long-term holders already own almost 80% of the supply.“Keep in mind alt supply, and ETF season ahead likely to be key drivers + disclosures,” trader Pentoshi noted as part of comments on the BTC price outlook.Cointelegraph contributor Michaël van de Poppe was similarly cool about current market activity.“I don’t think you should worry about the market consolidating here. Quite healthy,” he summarized on the day. “Altcoins still rocking. Great months to come in crypto.”A look at buy and sell levels on major exchange Binance confirmed resistance beginning at $48,600, this having crept lower during the consolidation. Buy interest, meanwhile, still lay at $44,000.BTC/USD buy and sell levels (Binance) as of Sept. 17. Source: Material Indicators“Bullish but cautious”Calmer conditions on derivatives platforms likewise cooled concerns over a repeat of last week’s major sell-off. Related: New Bitcoin price model suggests BTC won’t go below $39K againWhen Bitcoin lost $10,000 in a single day, overleveraged trading saw a wipe-out, and leverage has since stayed considerably lower.Slightly positive funding rates suggest that the market is much better positioned for sustainable upside — bullish, but without irrationality.“Traders in Bitcoin futures markets remain reasonably bullish with a positive funding rate returning to perpetual swap contracts,” Yann Allemann and Jan Happel, co-founders of on-chain analytics firm Glassnode, commented on an accompanying chart. “Note how funding rates are positive, but not up to the same level as before the $10k sell-off last week The Bitcoin market is bullish, but cautious.”Bitcoin futures funding rates annotated chart. Source: Yann & Jan/Twitter

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Shanghai Man: China’s version of McJob meme, eCNY airdrops, Canaan’s record revenue

This weekly roundup of news from Mainland China, Taiwan, and Hong Kong attempts to curate the industry’s most important news, including influential projects, changes in the regulatory landscape, and enterprise blockchain integrations.Regulatory noiseIn this week’s column, the Man in Shanghai is determined to squeeze all of the regulatory noise into one section, so as not to waste too much of your time. Let’s begin. It wasn’t much, just a warning from the Hebei Provincial government to announce it would put an end to cryptocurrency mining in the region. This is largely a non-story, since it’s essentially just restating a national level policy that went into effect months ago. Hebei was never much of a mining stronghold anyway, so the announcement is more procedural than anything else. Mining operations will continue to move overseas while China goes through its unified push to become carbon neutral. For reference, China has 23 provinces, and close to half have already restated their commitment to the national policy by announcing that cryptocurrency mining would not be tolerated.The Securities Times, a state-owned publication, ran a story warning the public about the bubble surrounding NFTs. This Shenzhen-based publication questioned the real economic value of NFTs, a topic that many of us have all wondered about at times. Still, the suspicion hasn’t stopped the trend from spilling into less mainstream art circles, where NFT and metaverse-related events are becoming more and more popular.Selling shovels in a gold rushWhile mining in China might be difficult, manufacturing mining machines is continuing to be quite profitable. Canaan, one of the world’s largest manufacturers of cryptocurrency mining hardware, announced its highest quarterly profits to date. The company’s Q2 financials showed that the company recorded over about $167.5 million in total net revenue. This was likely driven by the sharp increase in prices this spring, leading to aggressive expansion of mining facilities across the world. The next round of quarterly financials will tell a deeper story, as investors will learn how badly aggressive regulations by China have hurt the industry. Zhang Nangeng, Chairman and Chief Executive Officer of Canaan said:​​“We delivered a remarkable performance in the second quarter of 2021. Despite unexpected regulatory policy dynamics and Bitcoin price volatility, we achieved record-high topline results as we delivered a robust 5.9 million Thash/s of computing power to our clients.”Rounding up the trading spaceVolume remained mostly flat on exchanges like Huobi and OKEx, as it has for the last 12 weeks. The last major spike came during the sell-off in early May, around the time Chinese regulators began their crackdown. Over this time, FTX has seen a strong increase in volume, suggesting that some Chinese users might be connecting to exchanges that haven’t traditionally been a dominant player in the Chinese trading space. FIL remains popular on Huobi, finishing in the top five on Thursday’s 24-hr volume chart. This token has maintained popularity among traders in China, despite being about 50% below its all-time high from earlier this year. ADA, SOL, and DOT were assets that showed up high on OKEx volume charts, which mirrored global volume distributions. Speaking of Solana, Chinese users on Weibo reacted strongly to the network going offline on Wednesday, with some criticizing the network’s decentralization. Discussion broke out about whether Ethereum’s early technical issues were comparable to this event, proving that Solana and Ethereum maxis will disagree in any culture, regardless of the language.Unleashing the eCNYThe central bank digital currency created by the Chinese federal bank is now being pushed out even further, as popular app Meituan is offering roughly $1.50 in eCNY (digital yuan) to users who open a ‘digital wallet’ and use its services.Meituan is most widely known for its bright yellow food delivery service and shared bikes, which can be found on most city streets. The campaign is meant to encourage low-carbon living, and is open to nine pilot cities including Beijing, Shanghai, Shenzhen and Chengdu.The wallet interface is minimalist and allows users to convert, deposit, and transfer the eCNYThe eCNY, which originally was positioned as more of an institutional remittance tool for commercial banks, is now aggressively being pushed towards retail users. Already, large franchises like McDonalds and Zara display eCNY payment signs at point-of-sale counters across the country. The current digital payment space is dominated by WeChat Pay and Alipay, but those two will likely have a hard time holding control of market share if the central government is interested in forcing eCNY into competing applications.  Ironically, Meituan has a special role in Chinese cryptocurrency meme culture. Token holders often joke they will be forced to work in food delivery whenever the market crashes, leading to the meme below.Meituan’s iconic delivery drivers are the source of many crypto-related memes during a market crash.At the end of March, Meituan revealed it had around 570 million users. Other financial apps, including banking apps, have already integrated the wallet services into their products. 

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Multimillion-dollar investment rounds spark rallies in Avalanche and Audius

Altcoins continue to book notable gains on Sept. 16 as a slew of celebrity endorsements, major investments and the growing popularity of cross-chain bridges catch investors’ attention.Top 7 coins with the highest 24-hour price change. Source: Cointelegraph Markets ProData from Cointelegraph Markets Pro and TradingView shows that the biggest gainers over the past 24 hours were Audius (AUDIO), Avalanche (AVAX) and Celer Network (CELR). Superstars invest in AudiusThe Audius platform is a decentralized music-sharing and streaming protocol that aims to cut out the middleman from the music industry and allow fans, subscribers and creators to interact with each other directly. According to data from Cointelegraph Markets Pro, market conditions for AUDIO have been favorable for some time. The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historical and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.VORTECS™ Score (green) vs. AUDIO price. Source: Cointelegraph Markets ProAs seen in the chart above, the VORTECS™ Score for AUDIO was in the green for most of the past week and reached a high of 77 on Sept. 14, around 22 hours before the price increased 38% over the next day.The spike in price and trading volume for AUDIO followed the announcement that several well-known musicians including Katy Perry, Nas and The Chainsmokers had taken part in a $5 million strategic funding round for Audius. Avalanche benefits from a $230 million investing roundAvalanche (AVAX) is a layer-one protocol that has been gaining traction in 2021 thanks to its low fee environment and the launch of the “Avalanche Rush” incentive program, which has attracted investors and liquidity from the Ethereum (ETH) network. According to data from Cointelegraph Markets Pro, market conditions for AVAX have also been favorable for some time. VORTECS™ Score (green) vs. AVAX price. Source: Cointelegraph Markets ProAs seen in the chart above, the VORTECS™ Score for AVAX surged into the green zone on Sept. 13 and reached a high of 86 around 24 hours before the price increased 40% over the next two days. The boost in price and momentum for AVAX comes following the announcement that large funds like Polychain Capital, Three Arrows Capital and Dragonfly Capital participated in a $230 million investment round to the Avalanche ecosystem. Celer Network sees a surge from its bridge to ArbitrumCeler Network is a layer-two scaling solution that uses off-chain transaction handling to help to increase the scalability and the transaction throughput of its network.VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for CELR on Sept. 14, prior to the recent price rise. VORTECS™ Score (green) vs. CELR price. Source: Cointelegraph Markets ProAs seen in the chart above, the VORTECS™ Score for CELR spiked into the green zone and reached a high of 73 on Sept. 14, just as the price began to increase by 59% over the next two days. The increase in demand for CELR comes as investors use the Celer bridge for token migrations from multiple blockchains, including the newly launched Arbitrum solution. Celer’s bridge also offers users a work-around to the seven-day withdrawal process currently required to remove assets from Arbitrum. The overall cryptocurrency market cap now stands at $2.161 trillion and Bitcoin’s dominance rate is 41.4%.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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3 reasons why REN price is up 340% from its July swing low

Interoperability has become one of the driving themes within the crypto market and as the blockchain ecosystem evolves into an interconnected web of layer-one protocols, the importance of communication and efficiency among decentralized applications (dApps) will also increase.Ren (REN), a blockchain protocol designed to provide interoperability and liquidity between different blockchain platforms, has started gaining traction over the past month and a half as activity in the decentralized finance (DeFi) sector has been on the rise. Data from Cointelegraph Markets Pro and TradingView shows that after reaching a low of $00.41 on Aug. 9, the price of REN has climbed 185% to a daily high at $1.16 on Sept. 15 as its 24-hour trading volume spiked 443% to $673 million. REN/USDT 1-day chart. Source: TradingViewThree reasons for the price growth seen in REN include the steadily increasing activity and total value locked on RenVM, the launch of a bridge to Arbitrum and the release of RenVM Greycore on the network’s testnet. Rising volume and total value lockedREN’s bullish momentum can be found in the data for the total network volume and total value locked (TVL).Total network volume and total value locked on Ren. Source: Ren ProjectAs 2021 progressed, new chains were added to the list of bridges supported, which now includes Ethereum, Binance Smart Chain, Solana, Polygon, Fantom, Avalanche and Arbitrum. Each new bridge has helped to increase the volume and TVL on the Ren network, which has coincided with moves seen in REN p. REN price follows the Bridge to ArbitrumThe spike in price seen on Sept. 15 was due, in large part, to the release of the Arbitrum bridge, an Ethereum (ETH) layer-two scaling solution Arbitrum, which is designed to host popular decentralized applications in a fast, low-fee environment. The Ethereum network has been plagued by high fees and delayed transaction times, which have hampered the ability of many users to use DeFi or nonfungible token (NFT) related protocols on the network. Arbitrum’s low-cost environment has proven to be an attractive DeFi environment for BTC holders who are now able to migrate to the layer-two solution and interact on the network with renBTC. The total value locked on Arbitrum via the Ren protocol was $7.75 million as of Sept. 15 and is represented by the green line in the value locked chart above. Related: Solana and Arbitrum knocked offline, while Ethereum evades attackREN marches toward decentralizationA third reason behind the increase in activity for REN was the release of RenVM Greycore on the network’s testnet on Sept. 13, a move that was done as the project works toward its goal of full decentralization. Greycore is a semi-decentralized validator set of nodes that are operated by reputable DeFi projects and it helps to add an additional layer of protection for the protocol. The first project to join Greycore was BadgerDAO, a DeFi project focused on building projects that bring BTC to DeFi. According to data from Cointelegraph Markets Pro, market conditions for REN have been favorable for some time.The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historical and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.VORTECS™ Score (green) vs. REN price. Source: Cointelegraph Markets ProAs seen on the chart above, the VORTECS™ Score for REN turned green on Sept. 13 and climbed to a high of 71 on Sept. 14 just as the price of REN began to increase 72% over the next two days. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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BTC takes aim at $50K; Solana goes down; Is ETH ‘sound money’? | Watch The Market Report w/ Charlie Burton

Tune in to watch Cointelegraph host and analyst Benton Yaun alongside resident market experts Jordan Finneseth and Marcel Pechman. Here’s what to expect in this week’s markets news breakdown: Bitcoin (BTC) once again takes aim at $50,000. Is this the final hurdle before all-time highs are within reach?The Solana network was brought down by a sudden surge in transaction volume, while Ethereum evaded a malicious attack. What does this mean for the future of decentralized finance, or DeFi?After Cardano finally launched smart contracts, the price of ADA dropped 10%. Is this a classic case of “sell the news”?Next, Pechman and Finneseth take a dive deep into the most important factors driving the markets in back-to-back expert takes. Join Pechman on a journey through the history of Ethereum. There are a few events that might reveal what Ethereum truly is. Then, Finneseth takes a closer look at alternative next-generation blockchain protocols that are beginning to gain a foothold in the market. Up next, the Cointelegraph experts identify two altcoins that stood out this week, Avalanche’s AVAX and Horizen’s ZEN, using insights from Cointelegraph Markets Pro, a platform for crypto traders who want to stay one step ahead of the market. Finally, be sure to stick around for an exclusive guest interview with veteran trader Charlie Burton, the co-founder of Ezeetrader. The interview will cover recent market movements, trading insights and analysis of crypto’s biggest coins! “The Market Report” streams live every Thursday at 4:00 pm UTC, so be sure to head on over to Cointelegraph’s YouTube page and smash that like and subscribe button for all our future videos and updates.

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Cuba's cryptocurrency regulations take effect

Resolution 215 of 2021 issued by the Banco Central de Cuba (BCC) — the country’s central bank — recognizing cryptocurrencies like Bitcoin (BTC) is now in effect.According to Cuba’s official state news agency Prensa Latina, the order became official on Wednesday.With crypto legally recognized by the BCC, Bitcoin and other cryptocurrencies can now be used for commercial transactions and investments in Cuba.As previously reported by Cointelegraph, the central bank first announced plans to recognize and regulate crypto back in late August.Indeed, Resolution 215 of 2021 contains provisions for a licensing regime for crypto exchanges and other virtual asset service providers operating in Cuba.Despite legalizing the use of crypto assets in Cuba, the BCC has warned of the risks associated with cryptocurrencies.According to the BCC, while crypto operates outside of the nation’s banking system, the use of virtual currencies poses significant monetary policy risks and financial stability concerns.Cuba’s central bank also warned of the potential for bad actors to take advantage of the perceived anonymous nature of crypto transactions for illicit transactions.Related: Sept. 7 is ‘Bitcoin Day’ in El Salvador as BTC becomes legal tenderBy recognizing crypto, Cubans may begin to enjoy easier remittance flows from overseas despite the United States embargo. Global money transfer services like Western Union have largely exited the country under increasing pressure from Washington.Indeed, the country is towing a similar line to El Salvador in embracing Bitcoin amid crippling U.S. sanctions and the economic impact of the COVID-19 pandemic. El Salvador recently became the first country to adopt Bitcoin as legal tender.Crypto interest in Cuba has been high over the last few years with virtual currencies associated with the possibility of financial freedom for many in the country. The recognition of crypto by the BCC could be a major step in transforming Cuba’s cryptocurrency industry as a formal sector of the island nation’s struggling economy.

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Bitcoin ledger as a secret weapon in war against ransomware

Ransomware, malicious software that encrypts computers and keeps them “locked” until a ransom is paid, is the world’s fastest-growing cyber threat, according to Coinfirm. Recent attacks on critical national infrastructure, like the Colonial Pipeline incursion that crippled oil and gas deliveries for a week along the U.S. East Coast, have set off alarms. Ransom payments are almost always made in Bitcoin or other cryptocurrencies. But while many were shaken by May’s Colonial Pipeline attack — the Biden administration issued new pipeline regulations in its aftermath — relatively few are aware of that drama’s final act: Using blockchain analysis, the FBI was was able to follow the ransom payments fund flow and recover about 85% of the Bitcoin paid to ransomware group DarkSide. In fact, blockchain analysis, which can be further enhanced with machine learning algorithms, is a promising new technique in the battle against ransomware. It takes some of crypto’s core attributes — e.g., decentralization and transparency —  and uses those properties against malware miscreants. While crypto’s detractors tend to emphasize its pseudonymity — and attractiveness to criminal elements for that reason — they tend to overlook the relative visibility of BTC transactions. The Bitcoin ledger is updated and distributed to tens of thousands of computers globally in real time each day, and its transactions are there for all to see. By analyzing flows, forensic specialists can often identify suspicious activity. This could prove to be the Achilles’ heel of the ransomware racket.An underused means“The blockchain ledger on which Bitcoin transactions are recorded is an underutilized forensic tool that can be used by law enforcement agencies and others to identify and disrupt illicit activities,” Michael Morrell, former acting director of the U.S. Central Intelligence Agency, declared in a recent blog, adding:“Put simply, blockchain analysis is a highly effective crime fighting and intelligence gathering tool.[…] One expert on the cryptocurrency ecosystem called blockchain technology a ‘boon for surveillance.’” Along these lines, three Columbia University researchers recently published a paper, “Identifying Ransomware Actors in the Bitcoin Network,” describing how they were able to use graph machine learning algorithms and blockchain analysis to identify ransomware attackers with “85% prediction accuracy on the test data set.”Those on the frontlines of the ransomware struggle see promise in blockchain analysis. “While it may at first seem like cryptocurrency enables ransomware, cryptocurrency is actually instrumental in fighting it,” Gurvais Grigg, global public sector chief technology officer at Chainalysis, tells Magazine, adding:“With the right tools, law enforcement can follow the money on the blockchain to better understand and disrupt the organization’s operations and supply chain. This is a proven successful approach as we saw in January’s ‘takedown’ of the NetWalker ransomware strain.”Whether blockchain analysis alone is enough to thwart ransomware incursions or whether it needs to be joined with other tactics, like bringing political/economic pressure to bear on foreign countries that tolerate ransomware groups, is another question.Unmasking criminals?Clifford Neuman, associate professor of computer science practice at the University of Southern California, believes that blockchain analysis is an underutilized forensic tool. “Many people, including criminals, assume Bitcoin is anonymous. In fact, it is far from being so in that the flow of funds is more visible on the ‘public’ blockchain than it is in almost any other kinds of transactions.” He adds: “The trick is to tie the endpoints to individuals, and blockchain analysis tools can sometimes be used to do this linking.”A valid means for unmasking ransomware attackers? “Yes, absolutely,” Dave Jevans, CEO of crypto intelligence firm CipherTrace, tells Magazine. “Using effective blockchain analytics, cryptocurrency intelligence software” — the sort his firm produces — “to track where ransomware actors are moving their funds can lead investigators to their true identities as they attempt to off-ramp their crypto to fiat.” David Carlisle, director of policy and regulatory affairs at analytics firm Elliptic, tells Magazine: “Blockchain analysis is already a proven valuable technique for enabling law enforcement to disrupt the activities of these networks, as the Colonial Pipeline case made clear.”Within days of the May 8 ransom payment by Colonial Pipeline, Elliptic was able to identify the Bitcoin wallet that received the payment. Further, “It [the wallet] had received Bitcoin payments since March totaling $17.5 million,” recounts law firm Kelley Drye & Warren LLP. Elliptic was helped by the fact that the malefactors had used no “mixers” to further obscure their trail. Carlisle adds: “The underlying transparency of Bitcoin and other crypto assets means that law enforcement can often glean a level of insight into money laundering activity that would not be possible with fiat currencies.”A boost from machine learning?Machine learning (ML) is one of those emerging technologies, like blockchain, for which novel use cases seem to be discovered weekly. Can ML assist too in the war against ransomware?“Absolutely,” Allan Liska, a senior intelligence analyst at Recorded Future, tells Magazine, adding further: “Given the large number of malicious transactions occurring at any given time and the increasing sophistication of some ransomware groups, money laundering capabilities manual analysis has become less effective — and machine learning is required to effectively track tell-tale signs of malicious transactions.”“Machine Learning is very promising in fighting crimes,” Roman Bieda, head of fraud investigations at Coinfirm, informs Magazine, but it requires a huge amount of data to be effective. It is relatively easy to acquire Bitcoin addresses, which are available in the millions, but a dataset upon which a learning model can be trained and tested also requires a certain number of “fraudulent” Bitcoin addresses — i.e., confirmed ransomware actors. “Otherwise, the model will either mark a lot of false positives or will omit the fraudulent data as a minor percentage,” says Bieda.Say you want to build a model that will pull out photos of dogs from a trove of cat photos, but you have a training dataset with 1,000 cat photos and only one dog photo. An ML model “would learn that it is okay to treat all photos as cat photos as the error margin is [only] 0.001,” notes Bieda. In other words., the algorithm would just guess “cat” all the time, which would render the model useless, of course, even as it scored high in overall accuracy.  In the Columbia University study, researchers made use of 400 million Bitcoin transactions and close to 40 million Bitcoin addresses, but only 143 of these were confirmed ransomware addresses. “We show that very local subgraphs of the known such actors are sufficient to differentiate between ransomware, random and gambling actors with 85% prediction accuracy on the test data set,” reported the authors, adding that “Further improvement should be possible by improving clustering algorithms.” They added, however, that “Getting more data which is more reliable would improve accuracy,” making the model more “sensitive” and avoiding the sort of problem described above by Bieda, presumably. Along these lines, the United States Department of Homeland Security issued a directive in the wake of the Colonial Pipeline attack requiring pipeline companies to report cyberattacks. Reporting attacks had been optional before. Mandates like these will arguably help to build out a public dataset of “fraudulent” addresses needed for effective blockchain analysis. Adds Carlisle: “Public-private partnerships need to focus on sharing financial intelligence related to ransomware attacks.”Much blockchain analysis is premised on the notion that attackers can be unmasked after an attack takes place. But law enforcement agencies, and especially ransomware victims, would prefer that assaults not happen in the first place. According to Jevans, blockchain analysis can also enable enforcement agencies to act preemptively. He tells Magazine:“While blockchain clustering algorithms typically require someone to make a payment into an address in order to track the funds and identify the owner, advanced tools like CipherTrace can produce actionable intelligence on addresses that have yet to receive funds, as well, such as IP data that can assist investigators.”Necessary but not sufficient?Some ask, however, whether blockchain analysis by itself is sufficient to eliminate ransomware. “Blockchain analysis is an important tool in law enforcement’s toolkit, but there is no single silver bullet for solving the ransomware problem,” says Grigg. Liska adds: “Even the best research and identification tools aren’t effective unless governments are willing to take access. Stopping ransomware transactions is going to require cooperation between private entities and governments.”Many ransomware attacks originate on the borders of Russia, according to Coinfirm, so some ask if Vladimir Putin can be pressured to shut down those groups’ operations. “Past cases show not much can be done against the countries related to the cyberattacks, even if there are very strong indicators that the hackers are related to the secret services,” Bieda tells Magazine.  Others question whether blockchain analysis can make any dent at all in the malware problem. “It is way too soon to write off cryptocurrency as a vehicle for ransomware,” Edward Cartwright, professor of economics at De Montfort University, tells Magazine. “While there have been a few ‘good news’ stories of late, the reality is that ransomware criminals are still routinely using Bitcoin as the easiest and most anonymous way of extracting ransoms.”Moreover, even if Bitcoin becomes too radioactive for malefactors because of its traceability — “a big if,” in Cartwright’s view — “criminals can simply move to currencies that are completely anonymous and untraceable,” like Monero and other privacy coins, he says.“We really need to see increased collaboration between the private and public sector to build full profiles of these ransomware groups,” says Jevans. “Information sharing in these situations can be the silver bullet.” “One of the challenges is that ransomware groups are turning to offline methods to move Bitcoin,” says Liska. “Literally, two people meeting in a parking lot or restaurant with their phones and briefcase full of cash.” These types of transactions are much harder to trace, he tells Magazine, “but still not impossible with more advanced tracking techniques.”But will malefactors move to privacy coins?What about Cartwright’s point that ransomware actors will simply move to privacy coins like Monero if Bitcoin proves too traceable? Elliptic is already seeing “a significant uptick” in attempts to obtain payments from ransomware victims in Monero, Carlisle tells Magazine. “This has really increased since the time of the Colonial Pipeline case, when the implications of Bitcoin’s traceability were on clear display for any other cybercriminals watching.”But privacy coins can be traced too, though it’s more difficult to do because, unlike Bitcoin, privacy coins hide users’ addresses and transaction amounts. Some jurisdictions, too, have cracked down on privacy coins, or are thinking of doing so. Japan banned privacy coins in 2018, for instance. But there’s a practical problem too. Ransomware victims facing a payment deadline often have trouble finding exchanges that will convert their fiat currency into XMR within the required time period to pay their extortionists and unlock their computers, Bieda tells Magazine. Privacy coins aren’t nearly as well supported by crypto exchanges as Bitcoin. Jevans says “Bitcoin is simply the easiest cryptocurrency to acquire,” adding:“It is unlikely that ransomware actors will ever completely stop using Bitcoin because of its liquidity and the accessibility of Bitcoin to fiat off-ramps in comparison to other privacy-enhanced cryptocurrencies.”Most regulated exchanges do not offer Monero trading, adds Carlisle. “Victims may negotiate with the attackers and persuade them to accept payment in Bitcoin, but attackers will then typically demand a fee of 10%–15% for Bitcoin payments above what they would require for a Monero payment — which reflects their concern that Bitcoin’s traceability leaves them vulnerable.” Is banning crypto a solution?Recently, former Federal Reserve Bank of New York Supervisor Lee Reiners suggested in a Wall Street Journal opinion piece that “There is a simpler and more effective way to stop the ransomware pandemic: Ban cryptocurrency.” After all, he added, “Ransomware can’t succeed without cryptocurrency.” “This sounds like a solution that would be even worse than the problem,” comments Benjamin Sauter, a lawyer at Kobre & Kim LLP. “However, it does reflect a perception, particularly among many policy makers in the U.S., that cryptocurrency offers a haven for criminals that needs to be restricted,” he tells Magazine. “The profitability for the threat actors that are carrying our ransomware attacks would certainly decrease if cryptocurrency did not exist, as laundering fiat is inherently more costly,” Bill Siegel, co-founder and CEO of ransomware recovery firm Coveware, tells Magazine. “These attacks would still happen though.”“I do not think it makes sense to ban cryptocurrency,” Neuman adds. “The existing laws that are on the books in the U.S. require information to be collected on certain kinds of payment instruments for transactions over a certain threshold, and we can apply those rules to cryptocurrency as well. If we ban cryptocurrency, criminals will simply shift their payment demands to other instruments.”A “cat and mouse game”Moving forward, ransomware groups will have to live with the increasing risk of getting caught by using Bitcoin, says Liska, “or decide if they are willing to accept significantly lower ransom payments to better preserve their anonymity.”  This remains “a game of cat and mouse between the criminals and law enforcement,” adds Cartwright, “and recent successes of law enforcement are more because the criminals got sloppy or made mistakes [rather] than a fundamental flaw in the [criminals’] business model.”A global effort may be required to turn the tide on ransomware. All countries need to regulate crypto exchange platforms, says Carlisle, “otherwise attackers will continue to have easy avenues for laundering their proceeds of crime,” while Bieda predicts that crypto will continue to be used for ransom payments “until stringent global and regional regulations such as harsh penalties for lackluster KYC are introduced.”Tracing Colonial Pipeline #bitcoin #ransom to DarkSide to FBI seizure:▸5/8 Colonial Pipeline pays 75 BTC▸5/9 DarkSide affiliate withdraws 63.75 BTC▸5/27 63.75 BTC moved to another wallet, private key “was in the possession of the FBI”▸6/8 BTC in the wallet seized by FBI pic.twitter.com/RAebpn3P3H— elliptic (@elliptic) June 10, 2021It’s important to put ransomware in context, too. “Ransomware is simply the most recent method used by criminals to monetize their exploits,” says Neuman. “At some point it might cease to be called ransomware, but attacks on computer systems will take other forms.” Adds Sauter: “Everyone would win if there were an industry-based solution.”In sum, people tend to overestimate Bitcoin’s anonymity and underestimate its transparency. “There will always be bad actors,” as Jevans notes, but ransomware groups will realize that crypto payments are traceable, leaving them vulnerable and perhaps even inciting them to find other means by which to pursue their perfidious trade.Meanwhile, “Continued advancements in blockchain analytics will provide investigators with more and even better insights over time,” says Carlisle. And as law enforcement agencies become increasingly adept in their use of these analytic tools, “We can expect to see more, and bigger, [ransomware] seizures over time.”

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New Bitcoin price model suggests BTC won’t go below $39K again

Bitcoin (BTC) must cost at least $39,000, says a new tool combining two of its most powerful metrics.In a tweet on Thursday, analyst William Clemente presented the illiquid supply floor chart — and its findings are firmly bullish for BTC.Bitcoin’s price floor rises and risesWith exchange reserves dwindling and major corporate buy-ins expected to be announced in the coming weeks, analysts are all but guaranteeing BTC price upside.As Cointelegraph reported, long-term holders are now in possession of more of the supply than at any time since October 2020.Now, illiquid supply data has been combined with the popular and highly accurate stock-to-flow Bitcoin price model to form a new minimum price for BTC/USD.As Clemente described, it is “a price floor based on Bitcoin’s real-time scarcity.”A screenshot of the new chart shows a lower boundary for BTC/USD as being $39,000 as of this week — a level that neatly lines up with current technical predictions of where the pair should bounce in the event of a reversal.Bitcoin illiquid supply floor chart. Source: William Clemente/TwitterBloomberg eyes “significant advance” in 2021Stock-to-flow, meanwhile, has long demanded stronger performance from Bitcoin spot price, and its creator, PlanB, continues to stick by a $135,000 “worst case scenario” end-of-year close.Related: BTC holds $48K as Evergrande forms ‘Lehman Brothers moment’ for ChinaHe’s not alone. In its latest research, Bloomberg Intelligence gave renewed credence to $100,000 coming true for BTC/USD in 2021.“Past Bitcoin trading trends and the crypto’s declining supply vs. mainstream adoption suggest a significant advance in 2021, potentially to $100,000, we believe,” chief analyst Mike McGlone said as part of Twitter comments that echo Clemente’s.Bitcoin supply data vs. BTC/USD chart. Source: Mike McGlone/TwitterMcGlone said that no fewer than five charts currently point to the magic six figures — one year after Bitcoin first hit a five-figure price tag and never lost it.

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EU regulator sees crypto as sign of increased risk-taking in current climate

The European Securities and Markets Authority (ESMA) has published its report on trends, risks and vulnerabilities in the EU markets during the first half of 2021 (1H21).Its takeaways included the argument that crypto markets’ extraordinary volatility and growth make a compelling case for the need for a targeted regulatory regime, as sketched out in the European Commission’s proposed Markets in Crypto-Assets regulations.Much has been riding on the EU and global market’s recovery during 1H21 amid the ongoing impact of the COVID-19 pandemic. ESMA’s report notes that the economic outlook has continued to improve overall, with the European economy now forecast to reach its pre-pandemic output by the end of 2022, earlier than had been expected. This recovery has been fueled by the relaxation of public health restrictions, some reduction in uncertainty, and central banks’ activism in providing supportive monetary policies. When it comes to the medium-term risks of the current climate, ESMA has taken the crypto markets as a bellwether of market sentiment and dynamics during the past six months:”Rising valuations across asset classes, massive price swings in cryptoassets and event-driven risks observed in 1H21 amid elevated trading volumes raise questions about increased risk-taking behaviour and possible market exuberance.”This exuberance, in the ESMA’s view, has been visible in the GameStop saga and the broader rise of social media-fueled retail trading, coupled with the huge price growth in crypto assets in the first quarter of this year. Much of this increase in trading activity has been happening outside the EU’s regulatory perimeter, the report underlines, raising investor protection concerns. The ESMA attributed rising consumer confidence during this period to a range of factors, including innovative new business models and gamified features in online and mobile trading platforms. Parallel to the retail trading boom, ESMA is keeping a close eye on Decentralized Finance (DeFi), noting that the 47 billion euros ($55.3 billion) locked in DeFi in early September was down from its heights in mid-May, yet up 1,200% from end-July 2020. The ESMA recognized DeFi’s benefits, including disintermediation, 24/7 availability and censorship resistance, and noted that the increasing use of stablecoins and central bank digital currencies are likely to make the boundaries between traditional finance and DeFi more porous over time. However, especially due to institutional investors’ proactivity, the ESMA considered that there is a growing possibility that DeFi risks will spill over into the real economy, even though the market remains small for the time being.Related: EU securities regulator warns about risks of ‘non-regulated’ cryptocurrenciesThe report also noted that institutional investors are starting to consider Bitcoin’s (BTC) environmental impact in terms of their ESG targets, which is feeding into the growing interest in Ether (ETH). Alongside its environmental credentials, the ESMA attributed ETH’s success to its smart contract functionality, the DeFi boom, and the blockchain’s role in the nonfungible token ecosystem.The regulator’s assessment has been echoed by Pantera Capital CEO Dan Morehead, who this summer argued that the blockchain’s upgrade will likely help Ether to outflank Bitcoin as the largest cryptocurrency.

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