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Coinbase Informs 13K Affected Customers Of Imminent Data Handover To IRS

US-based cryptocurrency exchange and wallet service Coinbase sent an official notice Friday, Feb. 23 to approximately 13,000 of its customers whose information it is legally required to turn over to the US Internal Revenue Service (IRS).

The IRS had initially asked Coinbase in July 2017 to hand over even more detailed information on every one of its then over 500,000 users in an attempt catch those cheating on their taxes. However, another court order in Nov. 2017 reduced this number to around 14,000 “high-transacting” users, which the platform now reports as 13,000, in what Coinbase calls a “partial, but still significant, victory for Coinbase and its customers.”

On Friday, Coinbase told the around 13,000 affected customers that the company would be providing their taxpayer ID, name, birth date, address, and historical transaction records from 2013-2015 to the IRS within 21 days.

Coinbase’s letter to these customers encourages them “to seek legal advice from an attorney promptly” if they have any questions. Their website also states that concerns may also be addressed on Coinbase’s Taxes FAQ.

The ongoing legal battle between Coinbase and the US government dates back to November, 2016, when the IRS filed a “John Doe summons” in the United States District Court for the Northern District of California.

On Feb. 13, personal finance service Credit Karma released data showing that only 0.04 percent of their customers had reported cryptocurrencies on their federal tax returns so far this tax season.

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Pump and Dump in Crypto: Cases, Measures, Warnings

The pump and dump, an age-old scheme to quickly raise the value of a worthless asset and then selling it to reap the profits from the price increase. Not only is the pump and dump illegally under the securities laws, but it is also extremely popular in the world of Blockchain technology, cryptocurrency, and digital assets.

How does it work

In a pump and dump scheme, the price of a worthless asset-usually a penny stock with a low market cap-is artificially inflated through well-planned marketing. False statements, misleading statements, a large number of social media posts, co-signs, and other chicanery are used to get the word out that a worthless asset is actually a hot buy that investors do not want to miss out on (the pump).

To support these claims, the price of the worthless asset is increasing rapidly due to the well-planned pump. Once investors get word about the worthless asset and see its price rising rapidly, more investors start to buy up shares of the stock.

This is when individuals who are in on the pump and dump scheme will sell or “dump” the shares of the overvalued asset. These individuals profit from selling the asset at or near its peak for many times more than the price they purchased it at. When they begin to sell their shares of the overvalued asset, the price of the asset tanks and corrects to a more accurate and appropriate valuation.

Internet for pump and dumps

Before the invention of the Internet, pump and dumps were much harder to organize. Individuals had to organize pump and dumps in person, via telephone, or via snail mail. Pump and dump schemes were often organized by “Boiler Rooms,” outbound call centers that were known for using dishonest sales tactics like promoting penny stocks to turn a profit.

With the creation of the Internet, it became far easier to execute a pump and dump scheme. These days, individuals converse in chat rooms, via messaging apps, and on Internet message boards to coordinate a pump and dump. With all the venues that the Internet provides to converse with each other, the Commodities Futures Trading Commision (CFTC) has become wary that pump and dump schemes could even sway professional investors into taking on an amount of risk that they did not intend to undergo.

CTFC virtual currency customer protection advisory statement

On Feb. 15, the CTFC released their first Pump and-Dump Virtual Currency Customer Protection Advisory statement.

“Customers should know that these frauds have evolved and are prevalent online. Even experienced investors can become targets of professional fraudsters who are experts at deploying seemingly credible information in an attempt to deceive.”

The advisory even quoted messages from an online chatroom coordinating a pump and dump, 

“15 mins left before the pump! Get ready to buy.” “Five minutes till pump, next message will be the coin! Tweet about us and send everyone the link to telegram (sic) for outsiders to see what we are pumping so they can get in on the action too!! lets (sic) take it to the MOON!!!!!”

In the scheme cited above, the entire pump and dump process only lasted eight minutes.

The CTFC warns consumers:

“Customers should avoid purchasing virtual currency or tokens based on tips shared over social media. The organizers of the scheme will commonly spread rumors and urge immediate buying. Victims will commonly react to the currency’s or token’s rising prices, and not verify the rumors. Then the dump begins. The price falls and victims are left with currency or tokens that are worth much less than what they expected. From beginning to end, these scams can be over in just a few minutes.”

Regulations

As the market for cryptocurrency continues to grow, government organizations give the burgeoning market the attention that it needs to develop. This includes releasing detailed reports like the CFTC Primer on Virtual Currencies, holding hearings with Congress, and giving consumers all the available information they have to mitigate the chance that the consumer will be susceptible to fraud or manipulation.

Pump and dump schemes are illegal and considered securities fraud by the SEC. In most regulated markets like the London Stock Exchange and the New York Stock Exchange, they are illegal as well. The CTFC is even offering a 10-30 percent bounty for any pump and dump whistleblowers who are able to lead the CTFC to monetary sanctions of $1 mln or more.

However, pump and dump schemes aren’t illegal on cryptocurrency exchanges. Cryptocurrency exchanges are not regulated; there is no piece of the legislature about cryptocurrency exchanges. So even though a pump and dump is unethical, it is not officially illegal (yet).

Cointelegraph reached out to anti-money laundering (AML) specialist Joe Ciccolo, founder of BitAML-a company that provides anti-money laundering solutions for digital currency startups. When asked about the legal status development of pump and dumps in the cryptocurrency market, and if it is possible to whistleblow in an unregulated industry, Ciccolo said:

“The CFTC, like other financial regulators, will continue leveraging existing enforcement resources. Whistleblower programs, a common regulatory tool, have generally worked remarkably well at putting crucial and credible information into the hands of investigators. The CFTC has rightfully prioritized consumer education and protection by focusing on detecting and deterring fraudulent activities, such as pump and dump schemes, while not stifling early innovation in the crypto space.”

Case: market manipulation on Bittrex

A well-planned pump and dump could earn investors over 100 percent return on investment. In one case, an altcoin pumping group was able to pump a coins price by over 950 percent. At 11:40 a.m. on July 2 the moderator of the chatroom announced that the next pump would take place in 20 minutes on Bittrex. 15 minutes later, the moderator announced that the pump and dump would take place in 5 minutes (12:00 pm). At 12 p.m. the moderator announced the name of the coin, SLS, and sent a link to the relevant market on Bittrex. At the start of the pump, the SLS coin was worth .0046 BTC ($11.61 based on July 2 price). At the height of the pump, SLS was worth .0438  BTC ($110 based on July 2 price), and after the dump, SLS was back at .0059 BTC ($14.90).

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Image source: Altcoin Pumping Group 2/2 Telegram Chat

In November of 2017, a Business Insider investigation revealed that traders were coordinating pump and dumps on Bittrex and Yobit via the messaging app Telegram. Shortly afterward, Bittrex issued a statement:

“A general statement about market manipulation tactics:  Bittrex actively discourages any type of market manipulation, including pump groups.  Consistent with our terms of service, we will suspend and close any accounts engaging in this type of activity and notify the appropriate authorities.”

Following the announcement, pump groups on Telegram warned their members that Bittrex would be cracking down on manipulative behavior. One group-Trading signals for crypto-canceled their pump and dumps due to Bittrex’ policy change. Another group-Fake Pump&Dump Hunter-was interested in knowing if Bittrex’s announcement was a scare tactic or if it had actually been enforced. Fake Pump&Dump Hunter requested that any user who had their account suspended by Bittrex get in contact with them.

 

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Image source: Business Insider

Pump and dump groups often have thousands of members. At one point, Trading signals for crypto had over 7,000 members. Some members are professional investors and pump organizers who invested in the coin way before the date of the pump; others are retail investors, who find out which coin is being pumped at the same time the pump begins.

Four CTFC warnings

Although the cryptocurrency industry is maturing and taking the necessary steps to merge with the traditional banking and finance system. Blockchain and cryptocurrency is still in its Wild West phase. Due to a lack of regulation and consumer protections in the cryptocurrency markets, there are still enough opportunities to pull off fraudulent and manipulative schemes like the pump and dump. That is why it is always better to do independent research of the assets you are interested in investing in, and to only take on an amount of risk that allows you to sleep comfortably at night.

To protect investors against manipulative markets, The CTFC’s advisory also gave consumers the following warnings:

  • “ Don’t purchase digital coins or tokens because of a single tip, especially if it comes over social media.
  •   Don’t believe ads or websites that promise quick wealth by investing in certain digital coins or tokens.
  •   Do not participate in pump-and-dump trades; market manipulation is against the law and many participants end up losing money.  
  •   There is no such thing as a guaranteed investment or trading strategy. If someone tells you there is no risk of losing money, do not invest.”
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Bank Of America: Our ‘Inability To Adapt’ Could See A Failure To Compete With Crypto

Bank of America (BoA) has admitted to US regulators it may be “unable” to compete with the growing use of cryptocurrency.

In its annual report to the Securities and Exchange Commission (SEC) this week, filed Feb. 22, the major US bank for the first time highlights cryptocurrency as an area that may cause it “substantial expenditure” as it tries to remain competitive.

Our inability to adapt our products and services to evolving industry standards and consumer preferences could harm our business,” BoA states in the filing.

As banks worldwide eye the cryptocurrency phenomenon, direct interaction remains low. The lack of uptake formed a central reason why the European Central Bank confirmed it had opted for a hands-off approach to legislating the area earlier this month.

While BoA has sought to innovate in the sphere, receiving a patent for its proposed cryptocurrency exchange system in December 2017, it has come in for criticism more recently after blocking its clients from credit card purchases of cryptocurrency.

As the report to the SEC continues, the institution’s keen awareness of the threat posed to its core business offering by competitors becomes clear.

“…The competitive landscape may be impacted by the growth of non-depository institutions that offer products that were traditionally banking products as well as new innovative products,” BoA forecasts. The report continues:

“This can reduce our net interest margin and revenues from our fee-based products and services. In addition, the widespread adoption of new technologies, including internet services, cryptocurrencies and payment systems, could require substantial expenditures to modify or adapt our existing products and services[.]”

The bank also pointed to staff retention failures and “increasing competition” in the financial services industry as being detrimental to its prospects.

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Friend or Foe: Inside Poland’s Strange War on Cryptocurrencies

On the list of anti-cryptocurrency countries, Poland has never really stuck out. In fact, there has been enough evidence to suggest that the Eastern European country was moving towards embracing Bitcoin and Blockchain technology.

However, a recently uncovered smear campaign by the NBP (National Polish Bank, or Central Bank) has thrown that all out of alignment. The NBP has admitted to paying a number of YouTubers a sum of about $21,000 in order to dissuade Polish citizens into buying cryptocurrencies for fear of losing all their money.

The NBP has called this an ‘educational campaign’, trying to get across the dangers of cryptocurrencies, but it has come across more as a smear campaign which raises questions about the Polish government’s view of cryptocurrencies.

Seemingly accepting

Poland, along with a number of EU countries, has never shown any true discontent for cryptocurrencies prior to this latest campaign to discredit them. Back in 2013, there were reports of an official from Polish Ministry of Finance saying, “What is not forbidden is permitted. However, we certainly cannot consider Bitcoin to be a legal currency.”

In 2015, the Polish Finance Ministry issued a statement to the effect, “Any regulatory action addressing the problems of trading virtual currencies. They should be taken either as a result of initiatives at the EU level with a view to the cross-border nature of the business or as a result of a threat market failure cryptocurrency.”

In an interview around February 2015, Filip Godecki, CCO of Bitcurex, a major Polish cryptocurrency exchange, explained the government’s stance as neutral: “From our perspective, it would be difficult to talk about a negative trend. The attitude toward Bitcoin in Poland is neutral, converging with tendencies in most EU countries. Institutions are looking at the project from a certain distance, waiting for what comes next. The situation is similar with banks.”

In February 2017, trading of Bitcoin and other cryptocurrencies was officially recognised in the country. It was stated on a governmental website that from Dec.1, 2016, “The issuance of electronic currency and purchase and sale of electronic currency via the internet stand classified by official statistics services in Poland.” While there may be no definitive stance on Bitcoin and cryptocurrencies coming out of Poland, the government has seemingly allowed it to exist and continue functioning.

Growing popularity

One of the bigger indicators that the Polish government was leaning towards being Bitcoin friendly was when in March 2017 it released its Best Practices document to promote digitization of the national cryptocurrency market and help startups establish themselves in the market.

These guidelines were followed by several other programs aimed at promoting cryptocurrency technologies, such as the Ministry of Digitization’s “Blockchain / DLT Stream and Digital Currencies” program.

Еven more telling is that many well known cryptocurrency businesses set up shop in Poland over the years because the banking system was so welcoming and a lot more liberal than many others in Europe. Even the British stock exchanges and even the infamous Mt.Gox had their financial backing set up in Poland.

Latest smear

Despite Poland making no final call on its perception on Bitcoin, Blockchain and the entire cryptocurrency market place, there is evidence that the government sees potential and possibility in it. It therefore is very surprising that the Polish central Bank has launched this smear campaign that was partially hidden, but also unashamedly done.

Speaking to Cointelegraph, Polish Journalist and Youtube-blogger Karol Paciorek briefly explained the math between this campaign:

“There was a product placement deal between NBP and three large youtube channels: Marcin Dubiel – 937,000 subscribers; Wiśnia – 818,000 subscribers; and Planeta Faktów 1 mln subscribers. It’s an educational campaign paid from a government-based organisation. Someone asked NBP how much they have paid for the campaign, and got an answer – $21 000.”

The issue is that these videos are very slanderous of Bitcoin, and could hardly be called educational in the real sense of the word. Furthermore, there was no indication that it was a paid-for, or sponsored, video.

Another blogger, Maciek Budzich from the Mediafun Blog, has also written about the strange sponsored videos and their effect on the perception of cryptocurrencies in Poland. Budzich shows the actual response from the NBP when asked about the campaign, it details information including the figure spent. In Poland, every citizen has the right to ask the state authorities (as part of access to public information) about money and state spending.

NBP

Budzich states he is uncertain of the letter’s authenticity, but takes it as true pending any response from authorities. It has also appeared on other sources. It transpired, through Budzich, that Gamellon, a Youtube network partner company was the recipient of the state funds and that they had connections with some of the Youtube channels that were used. The only confirmation he got was that Gamellon cooperated with the NBP, but refused to share further details, and would not divulge the provisions of the contract.

The evidence is clear that the Central Bank worked towards smearing cryptocurrencies on these Youtube channels which raises questions about the stance Poland will take when it does come down to regulating digital currencies in the country.

There is further, tangible, evidence of the NBP’s thoughts on digital currencies with their information portal, which is labeled: “Virtual currency is not money.” It’s frontpage states:

“This is a digital implementation of a contractual value between two users that is not issued and is not guaranteed by any central bank of the world, such as Polish zloty, which is issued by the National Bank of Poland. Another risk is the lack of universal acceptance of such cryptocurrencies. Virtual currencies are not accepted in all retail stores and services. They are not a legal tender or currency.”

What effect did this have?

The campaign certainly got noticed, but probably for the wrong reasons as most media sources reported on the secret funding aspect, rather than the ‘educational’ campaign. In Poland, when the news broke that the Youtube videos were paid for by the NDP, the reaction among the country’s crypto community was one of anger.

Speaking to Cointelegraph, a local Polish cryptotrader going by the name of Crypto Polish Guru on Twitter, gave some insight:

“People are angry about this action, or they ignore it, the young people, that is. Older people don’t watch Youtube! In my country, citizens do not like the government anyway.”

The advancement of Blockchain and fintech in Poland is also a bit stop-start according to Crypto Polish Guru.

“We have the Ministry of Digitization, but Minister Anna Streżyńska was dismissed two or three months ago. She created a Blockchain group to work towards building a good environment for crypto in Poland, for me that was one of our best ministers. Now I think that they will liquidate the Blockchain working group.”

Why the secrecy?

The NBP’s decision to launch a biased and convoluted ‘educational’ campaign based on the danger of Bitcoin is what is drawn into question here. It would be understandable and agreeable if they were to issue a statement, like they have done, about what cryptocurrency is and is not, but it seems strange that their attempts to get their warning across came over as such fearmongering.

There was no link back to the NBP from the Youtubers, there was no ties from the videos to the bank. The connection only emerged when the NBP was queried on whether or not they were bankrolling the campaign. This calls into question the tactics of the central bank, and its motives in getting its point across in such a way. It also raises questions about how Poland will be regulating cryptocurrencies in the future.  

NBP’s response

Although the campaign was not broadcasted and advertised as a sponsored campaign by the NBP, they have never been afraid to furnish details of their so-called educational campaign. Tomasz Jaroszek, writing for doradca.tv, much like Budzich also questioned the NBP, and demanded a response, which he got.

The NBP’s rather lengthy response defends their efforts in educating the Polish population on the dangers of cryptocurrencies, going to list a number of fair dangers, such as volatility and no central backing and cyber crimes.

The NBP begin their gambit putting into context their authority to lead this campaign as they state they were carrying out their “constitutional and statutory tasks” for the sake of the “value of Polish money, and the stability of the Polish financial system.”

Following the listed reasons of the dangers of cryptocurrencies the NBP then goes on to direct attention to a warning they put out in June last year before explaining the December campaign:

“The goal of the information campaign conducted since December 2017 is to reach the widest possible audience, potentially interested in using virtual currencies – including people who have no experience in risky investing – with basic knowledge about the risks associated with investing in cryptocurrencies. This campaign hopes to make people interested in investing in cryptocurrencies refrain from actions that could bring them measurable losses, or if they will consciously take such actions, assume the risks associated with them. The NBP decided to conduct a campaign via the media – digital and traditional.”

The caveat however is that the NBP openly admitted it is not opposed to Blockchain technology, seemingly indicating this was not aimed to be a smear campaign:

“At the same time, we emphasize that the NBP is not opposed to the development of Blockchain technology and its use, but the application of this technology to the financial market must be just as safe and proven as it is with other technologies.”

A knee jerk reaction?

It is hard to understand the NDP’s decision to act in such a manner. Clearly they have a duty to inform about the dangers of cryptocurrencies, but the campaign they went on seems confusing.

Crypto Polish Guru’s closing remarks on why this played out in the way it did may have to do with a time when the NBP did not react.

“A few years ago in my country we had a large affair with Amber Gold – a company offering a high percentage returns for deposits made with them [essentially, a pyramid scheme]. It ended up going bankrupt and all investors lost all their money. At that time, the NBP, and other institutions didn’t react at all and they were strongly criticized.”

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UK Treasury Committee To Examine Crypto’s Effect On UK Businesses, Investors

The Treasury Committee of the UK Parliament will be launching an inquiry into cryptocurrencies and their effect on UK investors and businesses, BBC reports today, Feb. 22.

The inquiry was prompted by the rising global interest in cryptocurrencies, as well as the recent rise and fall of the crypto market since the new year.

Nicky Morgan, chair of the Treasury Committee, told BBC that she wants to protect individuals that “may not be aware that [cryptocurrencies] are currently unregulated in the UK,” but doesn’t want to hinder innovation of the Blockchain technologies behind digital currencies.

Morgan told BBC:

“The Treasury Committee will look at the potential risks that digital currencies could generate for consumers, businesses, and governments, including those relating to volatility, money laundering, and cyber-crime. We will also examine the potential benefits of cryptocurrencies and the technology underpinning them, how they can create innovative opportunities, and to what extent they could disrupt the economy and replace traditional means of payment.”

BBC writes that the committee will explore what they see as the key questions of crypto, namely if it could ever replace traditional payment systems and what benefits it brings to the public, businesses, and governments.

In terms of regulation, the committee will hear evidence on how regulation could “benefit digital currency start-ups by improving consumer trust,” and will examine how other countries have dealt with regulating digital currencies.

The House of Lords, Britain’s upper house of Parliament, had recommended exploring Blockchain technologies for government services including national security and public safety, healthcare, cybersecurity and customs and immigration in November of last year.

Bank of England (BoE) Governor Mark Carney said on Feb. 20 that while cryptocurrency has “failed” as a currency in his opinion, Blockchain technology “may still prove useful” for financial transactions.

The idea of having Blockchain without cryptocurrencies had been brought up negatively during the World Economic Forum in Davos in 2016. Crypto investor and founder of Cryptocash Guido Rudolphi said that companies that use Bitcoin (BTC) without Bitcoin technology will fail.

In November 2017, UBS Chairman Axel Weber said that Blockchain without cryptocurrencies can be useful for banks, for it retains their monopoly on currency but still gives them access to the new technologies.

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Telegram raises 850 million dollars in ICO pre-sale

Blockchain Media Group

Over the past few days, it has become known that the Durov brothers have raised $ 850 million from major investors in a first pre-sale for the Telegram token. This emerges from a reporting form to the US regulator SEC. This makes Telegram by far the largest ICO ever conducted, without which the public ICO has already been launched.

Telegram’s ICO is planned in two rounds. Round 1, which has now taken place, was for big investors who had to spend at least $ 20 million to get GRAM tokens in return. For this first round, the goal was $ 600 million. This could, as Bloomberg reported, now be far exceeded with 850 million dollars.

The second round of the ICO is open to all. However, there is no start date yet. Altogether should be taken over both rounds, according to Bloomberg, two billion dollar be taken. The largest ICO to date was that of Filecoin, which has grossed “only” $ 257 million.

Telegram plans to use the revenue to develop a blockchain, which should make the current top dogs Bitcoin and Ethereum considerable competition. The native token should be named GRAM.

In the Telegram app, a crypto currency wallet is to be integrated, with which the GRAM can be transferred and used for payment within the app. In addition, the app should offer a way to exchange other currencies in GRAM.

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Binance Vs. McAfee: Hack Rumors Controversy

For more than 24 hours, Binance, the world’s largest cryptocurrency exchange, was down due to a server issue on Feb. 7. On Feb. 9, Binance resumed trading after successfully rebooting its server.

Binance hack rumors refuted

John McAfee, a security expert and a well-known public figure in the cryptocurrency space, continued to fuel controversy around Binance and rumors of hacking attacks, showing screenshots that circulated on various social media platforms.

“I received dozens similar from a variety of sources. I’m not saying there was a hack. I’m merely asking for clarification. If a hack did happen and we are not immediately pursuing it, then the chances of recovery go to zero within 24 hours,” McAfee stated.

In response to McAfee’s statement, which referenced a photoshopped image of the Binance website, the company’s CEO Changpeng Zhao stated:

Immediately after McAfee released several statements on the issue, the Binance team along with its CEO Changpeng Zhao refuted the rumors, stating that Binance was not hacked. Binance went as far as to transfer funds from its cold wallet to hot wallet to show that the exchange was not hacked.

The Binance team also encouraged McAfee not to spread false information and provided evidence that funds on the exchange are safe by publicly showing the cryptocurrency wallet addresses of the exchange.

Zhao added that the exchange did not experience a hack, but an issue with its server and the team focused on recovering its data to enable trading.

Difference between hack and minor server issues

Recently, many cryptocurrency exchanges and trading platforms were hacked. Coincheck experienced a $530 mln hacking attack as reported by Cointelegraph and yesterday, the largest Nano (RaiBlocks) exchange BitGrail experienced a security breach.

The difference between a hacking attack and a minor server issue is that with security breaches, anyone can verify the movement of absurdly large amounts of cryptocurrencies from the cryptocurrency exchange’s wallets to external wallets, as seen in the case of Coincheck.

Hours before the Coincheck team admitted to a hacking attack, many members of the cryptocurrency community released evidence that hundreds of millions of dollars worth of NEM were moved from the wallet of Coincheck to external wallets.

Thus, if there is no evidence that large sums of funds in cryptocurrencies are transferred from the wallets of a cryptocurrency exchange to external wallets, it is irresponsible to suggest the possibility of a hacking attack.

On Feb. 11, Binance CEO Changpeng Zhao released a personal statement on the recent Binance server issue and the actions of McAfee.

“The real helper was Mr. Mcafee, posting an obviously fake image about us being hacked. Everyone pitched in to help defend us. He united the community for us, and rallied such support, during a time when we needed it the most. Sometimes, things that look negative are actually positive.”

Cryptocurrency exchanges have similar daily trading volumes as stock markets in regions like South Korea. Trading platforms process billions of dollars on a daily basis. As such, upon the occurrence of a hacking attack or a security breach, cryptocurrency exchanges often contact the authorities and cooperate with law enforcement to investigate the attack, as Coincheck did last month. Also, given the size of most major cryptocurrency exchanges, it is irresponsible to suggest the possibility of hacking attacks or security breaches without hard evidence.

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Wallet Wars? MyEtherWallet Developer Goes Solo To Launch MyCrypto

Popular Ethereum wallet interface MyEtherWallet (MEW) has released a unexpected alternative product, MyCrypto.com, one of MEW’s original developers announced in a blog post Feb. 9.

MEW has become one of the most popular Ethereum and ERC20 token storage management tools over the past year, and will continue to exist along with a new project, which has an almost identical interface.

In the blog post, one of MEW’s original developers Taylor Monahan gave a brief history of the project and the impetus behind her creating MyCrypto, while remaining silent on relations between herself and her fellow co-developer of MEW, known as Kvhnuke.

“MyEtherWallet LLC was sufficient for the early stages of growth. MyCrypto is designed with next-level scaling in mind from the beginning,” Monahan explained in the post, adding she had spent nine months assembling a team to oversee all operations. She also added:

“Kvhnuke remains in control of the MEW github repository, the MEW domain, the AWS instances, and the MyEtherWallet social media accounts.”

MEW’s structure has allowed it to avoid the common pitfalls ‘true’ wallet providers have struggled with increasingly as cryptocurrency has gained value and an influx of new users.

Ostensibly designed to serve even more users via a similar setup, MyCrypto will enter public beta testing in the near future, Monahan nonetheless stating she was “terrified” about the road ahead. She continued:

“I was terrified — am terrified — at the potential harm this change will have on myself, the team, and/or the Ethereum community but ultimately, the risks created by continuing down the road we were on are greater than the risks of splitting to a new brand, new company, new name, and new domain. While contemplating this decision, I began to see that my inaction would be the only thing that guaranteed my failure.”

Online, the circumstances surrounding the changes continue to cause suspicion and confusion among users.

While MEW has not yet published any comment about the new brand, curious statements about what staff describe as an “unlawful social media account switch” on Twitter have coincided with the release of the MyCrypto news.