How Facebook Libra Has Been Influencing Crypto, Politics and Finance


By Stephen O’Neal

Over the past few days, a number of Libra-related announcements have been made — only, they weren’t from Facebook, the Libra Association, Calibra wallet or any other party involved in its development. 

First, top crypto exchange Binance announced a project called “Venus” — coincidentally, another astrology-themed name — which will focus on developing “localized stablecoins” worldwide; the People’s Bank of China (PBoC) said it is almost ready to launch its government-backed digital currency, reportedly admitting that Libra prompted it to speed up; and Erik Finman, ostensibly the youngest Bitcoin (BTC) millionaire, launched a crypto peer-to-peer (P2P) payment app, called “Metal” — daringly marketing it as "the Libra killer."

Libra has been making waves since its white paper was released in mid-June, prompting regulators across the world to form global task forces, United States legislators to hold multiple hearings in the Senate and crypto firms to roll out competing projects. 

However, Libra itself is still far from seeing the light of day: Its initial release is scheduled for 2020, but given the scale of regulatory backlash it has been facing, the future of Facebook’s crypto venture is hardly set in stone. Nevertheless, just two months in, its influence on the space is already palpable. 

Libra and the regulatory splash

Libra, a stablecoin-like digital asset and a blockchain-based financial infrastructure project, was officially announced on June 18, when Facebook published its white paper. The release followed several media reports suggesting that the social media titan was developing a cryptocurrency that will facilitate payments across its platforms — WhatsApp, Messenger and Instagram — which boast a combined 2.7 billion monthly users

The project seeks to target the unbanked population, which accounts for around 1.7 billion adults across the globe, with a focus on cross-border remittance. The latter aspect puts Libra alongside the likes of Visa and Mastercard — both of which have invested in the project — as well as some fellow cryptocurrency firms like Ripple and the XRP token. 

The project will be governed by the Libra Association, a not-for-profit consortium headquartered in Switzerland, which includes Mastercard, PayPal, Visa, eBay, Coinbase, Andreessen Horowitz, Lyft and Uber among a total of 28 founding members. 

There is also Calibra, a Facebook subsidiary, which is developing an eponymous digital wallet to facilitate Libra transactions, while the currency will be supported by third-party wallets — as the software powering the Libra blockchain is open source, as its developers have said. Once ready, the wallet will be available to all of the social media’s users.

The looming release of Facebook’s new project caused immediate regulatory resentment, triggering a new wave of national-level discussions on the legal status of cryptocurrencies. The company’s infamous reputation for being involved in privacy-related scandals — the most recent being Cambridge Analytica, which resulted in a record-breaking $5 billion fine— its all-encompassing scale and its barefaced interest in cryptocurrencies made it an unmissable target for regulators across the world. 

In July, U.S. congressional hearings on the matter began, and Calibra CEO David Marcus was interviewed twice before Congress. The key take-away from those meetings was that Facebook won’t launch Libra until regulators’ concerns are fully addressed, as Marcus explicitly reassured both lawmakers and investors. That has not entirely mitigated the pushback, however, as the European Union antitrust regulators have launched a probe into Libra. 

Meanwhile, U.S. legislators — including vocal Libra skeptic Rep. Maxine Waters (D-CA) — are travelling to Switzerland, the home of the Libra Association, to meet with Swiss Federal Data Protection and Information Commissioner Adrian Lobsiger to exchange views about digital currencies.

John Todaro, director of research and provider of institutional trading tools for digital currencies at TradeBlock, summarized the main reasons behind the intensified scrutiny in a comment for Cointelegraph:

“The primary attention Libra is getting is because of the size of Facebook, its resources, and its ability to integrate a low cost, efficient digital currency payment channel across a number of its own platforms which could bring significant adoption to the space. Other projects have not seen the same level of interest, mainly because they do not have an ability to accelerate adoption of a stablecoin so quickly, which Facebook could accomplish.”

The scale of the regulatory backlash is not surprising, despite the rawness of Facebook’s project, experts say. Konstantinos Stylianou, assistant professor of competition law and regulation at the University of Leeds, told Cointelegraph that for regulators, it is never too early to start worrying about potential problems. He elaborated:

“Financial regulators are right to go in first, because financial regulation aims to ensure that Libra and its clones comply with set standards before they launch. Other regulators, like the European Commission's antitrust arm, which recently started an investigation into Libra, have a long way to go, because they need to prove actual harm. But even so, their early activity sends a message to the industry that the regulator's watchful eye is there to stop illegal activity at its inception.”

Other experts, like Lars Seier Christensen, chairman of Swiss blockchain identity network Concordium and former CEO at Saxo Bank, are even surprised that Facebook has not foreseen some of the regulators’ worries. Christensen explained to Cointelegraph:

“I actually fully understand the concerns of regulators as Libra raises a host of major issues because of the potential scale of the project. I think Facebook may have been a little too quick off the block here, because many of the concerns about systemic risk, disruption of money markets, and moral hazard were easily predictable and could have been addressed from the beginning.”

Libra and its killers: Chinese government, Binance and Walmart

While many of the aforementioned jurisdictions were busy discussing the potential ways to regulate Libra, China took a somewhat different approach. For the East Asian powerhouse, where the sale of cryptocurrencies is explicitly banned, Facebook's project turned out to be the prime motivator in hastening the development of its own state-controlled digital currency.

Notably, during one of the congressional hearings, Marcus warned lawmakers that vetoing Libra could result in the U.S. being left behind: 

"I believe that if America does not lead innovation in the digital currency and payments area, others will. If we fail to act, we could soon see a digital currency controlled by others whose values are dramatically different.”

China steps in

Thus, after five years of research and system development work since 2018, the PBoC is almost ready to launch its central bank digital currency (CBDC), according to a recent reportfrom the state-owned news portal China Daily. As Yang Dong — director of the Research Center of Finance Technology and Cyber Security at Renmin University of China — told the publication that the announcement of Libra has motivated the project’s designers to involve more private institutions in development and issuance process of a CBDC, which seems to follow the concept of the Libra Association. 

Co-founder of a decentralized cloud computing network Aelf, Chen Zhuling, whose associate Ma Haobo is a committee member of the government-affiliated Chinese Institute of Electronics Blockchain Branch, told Cointelegraph in an email conversation that:

“Considering how mobile payment and e-money has been fully adopted in the Chinese society, it is inevitable that the government is also looking at digital currency initiative. More than half of global Bitcoin hash rate is under mining pools in China, the government is no strange to cryptocurrency.”

Patrick Dai, co-founder of Qtum, a blockchain platform that has a presence in China, is largely optimistic about the project, as he told Cointelegraph that the PBoC’s currency is likely to beat Facebook in terms of public resonance and will challenge “the monopoly” of local giants WeChat and Alipay:

“People’s Bank of China’s digital currency will escalate and affect crypto adoption at a much greater magnitude than Facebook’s Libra announcement. There is already overwhelming distrust of Facebook. Introducing a new asset class also brings healthy competition to the Chinese FinTech ecosystem, which is currently dominated by a few major players. A complimentary payment solution helps break up the monopoly of power from payment giants like WeChatPay and Alipay.”

However, CBDCs and privately issued cryptocurrencies can co-exist, which is relevant for capitalist economic systems exclusively, professor Stylianou said:

“Central bank cryptocurrencies and private cryptocurrencies are not in a zero-sum game. The adoption of one does not detract from the adoption of the other. They can and will most likely co-exist, much like state-provisioned goods co-exist with privately-provisioned goods in every other industry. This, of course, only applies to free capitalistic economies.”

Binance launches a race to the stars

Other Libra competitors come from the private sector. Arguably, the strongest attempt to topple Facebook’s crypto project is being performed by Binance, one of the world’s largest crypto exchange, although, as its CEO, Changpeng Zhao, diplomatically noted, it is “always happy to co-exist.” 

Thus, following the astrological theme, Binance’s open blockchain project is dubbed “Venus” and focuses on developing localized stablecoins around the world based on Binance Chain, which reportedly has a wide user base and has already established global compliance measures. 

However, it is still unclear whether Venus actually could rival Libra for the global crown. Judging by the announcements made in English and Chinese, the tones used are drastically different, with the latter mentioning challenging “financial hegemony” and creating “independent ‘regional version of Libra.’” Binance has not yet responded to Cointelegraph’s request for clarification regarding the relationship with Libra.

There is also a global retail giant, Walmart, that has already filed a patent for a U.S. dollar-backed digital currency similar to Libra. According to the retail giant, it could provide low-income households — for whom banking is costly — with “an alternative way to handle wealth at an institution that can supply the majority of their day-to-day financial and product needs.” Additionally, it could further challenge incumbent banks by removing the need for credit and debit cards, Walmart suggested in the filing.

Libra has also provoked a response from smaller, crypto-oriented startups, which are brazingly calling themselves “Libra killers.” For instance, Erik Finmann, known as the youngest Bitcoin millionaire, has recently announced a crypto P2P payment app called “Metal” that reportedly supports Bitcoin and Ethereum (ETH), among other cryptocurrencies. 

It seems to be working in select U.S. states at the moment, which makes it unclear how it could “finally bring crypto to the people — in ways that Facebook Libra only wishes they could,” as Finmann put it on Twitter, given the scale of the social media giant’s operation. Metal has not responded to Cointelegraph’s request to clarify the scale of its operation. 

Libra’s influence has accelerated, despite all the difficulties

While it is not certain if Libra will ever manage to get through the regulatory hurdles it is facing, its impact on the crypto industry — and even the larger financial world — is evident. TradeBlock’s Todaro told Cointelegraph, “Libra has influenced the industry insofar that other large corporate entities and governments have sped up their projects on stablecoins, such as Wal-mart, PBoC, Binance and others.”

Notably, while the overall scope of Facebook’s crypto project could have been predicted, experts are perplexed by the breakneck speed at which everything around it is unfolding. “It was only a matter of time until Libra contenders emerged,” Stylianou told Cointelegraph. “What's surprising is how quickly it's all happening.” He went on to say:

“The majority of Libra killers will be extinct within a few years (including, possibly, Libra itself), as it always happens with prototypes, but that at the same time means that some others will survive.”

Thus, Libra seems to be actively unsettling the crypto space even at its most infant stage, urging other actors to launch similar stablecoin-based projects or join it by investing as much as $10 million. Among the interested parties are online brokerage Monex Group Inc., the owner of the hacked Japanese crypto exchange Coincheck and even the Winklevoss twins, who have famously had a falling out with Mark Zuckerberg over Facebook in the past. 

On the other hand, some of the earlier investors are reportedly asking to get off the trainbecause they’re frustrated with Libra’s half-baked strategy — as well as the intense regulatory pushback it has been getting.


US Treasury Sanctions Bitcoin, Litecoin Addresses Under Kingpin Act


By Max Boddy

The United States Department of the Treasury has added multiple cryptocurrency addresses to its Specially Designated Nationals (SDN) list under the Foreign Narcotics Kingpin Designation Act, or the Kingpin Act. These addresses, and the individuals associated with them, have been deemed to be associated with foreign narcotics operators.

The Treasury updated its SDN list with recent Kingpin Act Designations on Aug 21. The three alleged narcotic operators associated with these addresses are Chinese citizens Xiaobing Yan, Fujing Zheng and Guanghua Zheng. The three individuals all have associated Bitcoin (BTC) addresses mentioned on the SDN List, and Guanghua Zheng additionally has a Litecoin (LTC) address.

As explained in a White House press release from 2015, the Kingpin Act exists to ban trading and transactions between narcotics traffickers and U.S. entities, namely companies and individuals. Under the Kingpin Act, a multitude of governmental branches coordinate to investigate narcotics traffickers, who are then named in a list that is brought before the President of the U.S., who then determines which members on the list will receive U.S. sanctions.

Mnuchin: Bitcoin is vulnerable to money laundering

As previously reported by Cointelegraph, U.S. Treasury Secretary Steven Mnuchin believes that Bitcoin is vulnerable to money laundering. Mnuchin said that he intends to closely monitor Bitcoin and believes that billions of dollars in cryptocurrency are used for illicit purposes. 

Mnuchin has further stated that he believes Bitcoin is used for money laundering much more effectively than the U.S. dollar. According to Mnuchin, the government combats “bad actors in the U.S. dollar every day to protect the U.S. financial system.”


Bitcoin’s Popular Twitter Handle Abandoned BCH for BTC?

By Sead Fadilpašić

There’s hardly a single inhabitant of Cryptoland who is not aware of the clash between Bitcoin (BTC) and Bitcoin Cash (BCH), ever since (or likely even before), in 2017, BCH was created as a hard fork of BTC. However, an interesting and sudden thing happened, as the popular @Bitcoin Twitter handle, that has 967,000 followers and is known for its ardent support of BCH, now seems to be supporting BTC.

People have noticed that, practically overnight, 

  • numerous posts relating to and supporting BCH and its community were deleted

  • BCH-related accounts were unfollowed

  • the Bitcoin whitepaper redirects to Bitcoin-focused website, and not to pro-BCH

  • the pinned tweet, explaining what BCH is, with @Bitcoin defending it in the comments as a better solution than BTC, was removed

  • what remained are the older pro-BTC tweets.

Old @Bitcoin | source:

Old @Bitcoin | source:

New @Bitcoin| source:

New @Bitcoin| source:

Given that nobody knows what happened, as expected, people started coming up with their own theories. Some say that Roger Ver, the main proponent of BCH and founder of, might’ve returned to BTC, others suggested that Ver sold the account for a lot of money, while some say that Twitter CEO Jack Dorsey might be behind this, due to his investment in Lightning Network developer Lightning Labs.

Meanwhile, Autonomous Bitcoin AI #2357 tweeted that Ver previously claimed to know the current owner of the controversial handle: “So, he either must know what happened with the account or there was a fallout between them. Yet he doesn't reveal any information and lets his employees run rampant on r/btc with conspiracy theories instead.”

Roger Ver✔@rogerkver

I've never owned the @Bitcoin account. It is owned by someone involved in Bitcoin since 2009. He supports #BCH, is well known in the Bitcoin ecosystem, but doesn't want to deal with incessant trolling so he has chosen not to make his identity public.

12:22 PM - Apr 9, 2018 · Tokyo-to, Japan

BashCo, moderator of r/Bitcoin subreddit, said that @Bitcoin perhaps “went all in on Bcash on Roger and Craig’s (Craig Wright) advice, and is now broke and angry”, with some disagreeing: 


Maybe @bitcoin went all in on Bcash on Roger and Craig’s advice, and is now broke and angry. Would be great to hear what really happened. …

Autonomous Bitcoin AI #2357

Replying to @2357_is_prime and 2 others

Roger claimed in the past that he knows the current owner of the handle. So, he either must know what happened with the account or there was a fallout between them. Yet he doesn't reveal any information and lets his employees run rampant on r/btc with conspiracy theories instead.


How would they be broke over the past 6 months it's only increased 450% or even holding since the November hashwar drop only puts you at a 10% gain. Over the last 3 months they've only regained money. Your bias and agenda pushing is showing and it's making you stupid.

4:25 AM - Aug 20, 2019

However, on the question if there’s anything that can be done to save @Bitcoin, Ver himself seems to have replied with “I don’t know.”

We have asked Ver for comment and will update the article if he responds. 

Furthermore, the host of YouTube channel BTC Sessions claims that @Bitcoin has been sending messages to users who’ve blocked the handle, saying: “The @bitcoin account just DM'd me and said he'd love it if any maximalists that have the account blocked would begin to un-block him. Seems a bitcoiner is once again behind the helm. Color me surprised.”

John Carvalho

If @Bitcoin follows me back, then you know it has truly been freed from Roger.

Meanwhile, Litecoin creator Charlie Lee is poking fun at the matter, suggesting his own theory.

Charlie Lee [LTC]✔@SatoshiLite

I have no proof of this, but I think the owner of @bitcoin must have had a romantic relationship with Roger Ver and recently broke up with Roger. That's the only thing that can explain why @bitcoin stopped supporting BCH.

2:58 AM - Aug 20, 2019

Back in June, reported that some members of the cryptoland started to speculate that Bitcoin Cash is "on the brink of the collapse and developer coup is under way". Ver denied these statements telling us that “It is fake news”, and that at they have “nearly a hundred people all working on Bitcoin Cash including protocol development.”

BCH is fourth on the list by total market capitalization. At pixel time (12:56 AM UTC), it trades at c. USD 317 and is down by 2% in the past 24 hours, by 6% in the past week and by 43% in the past 12 months.


US Secretary of State Wants to Regulate BTC Like Other E-Transactions

Golden Bitcoin with judge hammer

By Helen Partz

United States Secretary of State Mike Pompeo believes that Bitcoin (BTC) should be regulated the same way as other electronic financial transactions.

Security risks of reduced governmental monitoring

In an interview on Squawk Box on Aug. 20, Pompeo pointed out the risk of anonymous transactions associated with crypto, saying:

“The risk with anonymous transactions is one that we all know well. We know this from 9/11 and terror activity that took place in the 15 years preceding that where we didn’t have good tracking, we didn’t have the capacity to understand money flows and who was moving money.”

CNBC’s co-host Joe Kernen brought up the subject of Bitcoin in terms of terrorism. Kernan raised the question in light of geopolitical tensions in the Middle East. Specifically, Kernen recalled a viral claim by U.S. Treasury Secretary Steven Mnuchin that cash is not used for nefarious activities like Bitcoin is.

When asked for his stance towards Mnuchin’s statements, Pompeo appeared to support the Secretary to a degree, expressing his hope that crypto and anonymous transactions will not become the norm since that “would decrease the security for the world.”

Equal regulation

However, in contrast to Mnuchin’s intentions to enforce strong regulations in the space, Pompeo expressed his vision of regulating Bitcoin the same way as all other electronic financial transactions today.

Recently, a former exec at German multinational investment bank Deutsche Bank published an article urging that Bitcoin is a leading indicator of hidden geopolitical tensions.


Crypto Custodian BitGo Hires Former Xapo Vice-President as CRO


By Ana Alexandre

Digital asset trust and security company BitGo has appointed wallet provider Xapo’s former senior vice-president Pete Najarian as its new chief revenue officer (CRO).

As finance-focused media outlet Finance Magnates reported on Aug. 19, Najarian will now serve as BitGo’s CRO, reporting to the company’s chief executive officer Mike Belshe. Commenting on the appointment, Belshe said:

“Pete has a deep understanding of capital markets and an exceptional breadth of experience in financial services. This makes him a perfect partner for institutional investors who are entering the cryptocurrency market. We’re building the financial infrastructure of the future and Pete’s experience in both traditional financial markets and cryptocurrency will be critical.”

Najarian’s profile on business and employment network LinkedIn reveals that he previously served as global head of emerging markets sales at the Royal Bank of Scotland, and head of institutional client coverage-APAC at financial services firm UBS, among others.

BitGo expands its presence

Earlier in August, Cointelegraph reported that BitGo is expanding its presence in Japan. BitGo is reportedly planning to grow its Japan-based team, including hiring a sales director for the company’s Tokyo office.

In May, BitGo appointed veteran Wall Street trader Nick Carmi as its head of financial services. The hire ostensibly intends to forge stronger connections between digital assets and the traditional financial sphere.


Binance to Resume US Operations Within Two Months, Predicts CEO CZ


Kollen Post writes:

Changpeng Zhao, CEO of major cryptocurrency exchange Binance, has predicted that Binance will resume crypto-to-fiat operations in the United States within the next two months.

Navigating U.S. regulation

Zhao, also known as CZ within the crypto community, made his prediction in an interviewwith online news outlet Cheddar published Aug. 15. When asked about Binance’s return to operations in the U.S., Zhao said: 

“I don’t want to promise any fixed dates, but there’s a lot of work being done and there’s a lot of things going on in flux, but I would say in a month or two.”

Back in June, Binance announced that the exchange would be temporarily restricting services in the U.S. as it worked to open a new division to operate with Financial Crimes Enforcement Network (FinCEN) approval, at Cointelegraph reported at the time. 

U.S. regulation has been a critical issue In today’s interview, Zhao said that the partnership with BAM Trading Services will help the firm to navigate the US’s regulatory environment, commenting that “now we have our partner, we want to take this opportunity and explore the market.”

Future of the market

In response to a question about the impact of U.S. regulatory ambiguity, Zhao said:

“I think the US is one of the most developed markets because I think it has good regulations in the traditional finance space. Crypto is a new thing, and for new things, the US is a big country and with a lot of regulatory bodies and a very large market [...] in a large market it is harder to regulate.” 

Zhao ultimately expressed optimism for the future of U.S. regulation, citing the country’s clear legal framework for traditional financial services as evidence that the environment for crypto will improve.

Despite Zhao’s optimism, Binance has experienced several issues with security in recent weeks. A dusting attack on Litecoin reportedly affected nearly 300,000 Binance users earlier this month. On Aug. 7, news surfaced that the exchange had fallen victim to a hack that exposed the know-your-customer data of its users.


Barclays May Be ending Work With Coinbase, Transactions in GBP to Slow


By Kollen Post

British banking giant Barclays has reportedly cut ties with United States crypto exchange Coinbase.

As Coindesk reported on Aug. 13, unnamed industry sources have said that Barclays will no longer be banking for Coinbase, severing a relationship that began when Coinbase opened a Barclays account in March 2018.

The news is expected to hit the crypto community hard, as, in addition to linking a major crypto exchange with a heavy hitter among the traditional banking establishment, the break may end Coinbase users’ access to the United Kingdom’s Faster Payments Scheme and slow the exchange of cryptocurrencies for British pounds sterling dramatically.

The precise reason for the split is unknown, but one anonymous source speculated to Coindesk that: 

“It is my understanding that Barclays’ risk appetite has contracted a little — I’m not sure exactly why or what’s been driving that, maybe there has been some activity they are not happy with. But it’s about Barclays’ comfort level with crypto as a whole.”

Reportedly, Coinbase will continue its access to UK banking through Clearbank, a younger and less established operation.

This is not the first time that Barclays has taken a step back from increasing involvement in the crypto sphere. In August of 2018, the bank began official denials that it was opening a crypto trading desk in light of two employees removing information about work on digital assets from their respective LinkedIn profiles. 

Coinbase, for its part, does not seem to have suffered greatly in recent months. This July, it came out that the exchange had registered eight million new users in the preceding year.

Also in July, Cointelegraph reported that Coinbase’s CEO Brian Armstrong was looking to take the exchange beyond trading, expressing plans to expand Coinbase into wider promotion of crypto adoption.

Cointelegraph reached out to Coinbase for comments but did not receive a response by press time. 


Kraken Users Report Difficulties with Connecting to Site and API


Ana Alexandre writes:

San Francisco-based cryptocurrency exchange Kraken’s users are experiencing difficulties with connecting to the site and application programming interface (API).

In a tweet published on Aug. 13, Kraken warned the public that it is receiving reports of clients having issues connecting to the site and API. The exchange further states that it is investigating the issue and will post related update.

Back in January, the Exchange Security Report from independent analysts at ICORating gave 16 percent of the world’s biggest crypto trading platforms an A rating, and none of them an A+. The analysis ranked Kraken (A) as one of the top three most secure exchanges globally.

Security has always been a sensitive issue for digital currency-related projects. Earlier in August, Major South Korean cryptocurrency exchange Coinone partnered with cybersecurity audit company CertiK and disclosures company Xangle to provide more safety and transparency for their crypto investors. CertiK and Xangle will provide public disclosure information as well as smart contract audit information, respectively.

In June, Cointelegraph reported that Odyssey, the mainnet for the blockchain-based platform TRON, will be upgraded to version 3.6. Odyssey version 3.6 will reportedly contain new features designed to make DApp creation easier, as well as provide network protection from bad actors.


Current Tether Supply Suggests Bitcoin Price Is Correcting to $20,000


Horus Hughes writes:

Bitcoin price charting on a longer timeframe, market structure and the issuance of 1 billion Tether so far this year are making crypto and equities analyst FilbFilb incredibly bullish on BTC/USD in the run up to the 2020 halving. 

Bitcoin traders split into 3 groups 

Since correcting from 2019’s all-time high of $13,800 and thrice failing to break above $12,500, crypto investors broke into three camps. 

The first took the bearish perspective and predicted a pullback to $8,500-$7,500, often citing the CME gap. 

The second envisioned a lengthy period of consolidation where Bitcoin price would remain pinned between $9,000 and $12,000, providing the opportunity for savvy traders and institutional investors to accumulate prior to the 2020 halving. 

The third group interpreted the parabolic breakdown as nothing more than a blip and remain steadfast in their belief that the digital asset will eventually rally back to $13,500 and higher. 

4 ways Bitcoin price structurally shifted in 2019

According to popular crypto and equities analyst FilbFilb, Bitcoin price has undergone a structural shift for several reasons, he explained in his weekly newsletter. 


  • The digital asset is consolidating near $11,800 (a resistance formed in Q1 2018) after bouncing off the double bottom at $9,500. This level now serves a strong weekly support and FilbFilb believes consolidation below resistance is a bullish indicator.

  • Bitcoin has broken above $12,000 four times in separate weeks over the last seven weeks and the price action within this zone is different from Q1 2018 as all attempts to surmount $11,800 were met with swift rejection.

  • Bitcoin’s market structure represents a bullish pennant with a “minimum target” aligning with the next important weekly resistance at $16,000. According to FilbFilb, this is a “multi month pennant, which is supported by the back breaking rejection of the lows found in 2018.” In 2018, retests of $12,000 consistently broke out the downside, where as in 2019 Bitcoin price action appears likely to make a strong upside move over the coming weeks.

  • The VPVR shows a void in price history above $12,000 and a sharp upside move to $14,000 would open the doors to price discovery. It’s unlikely that a move to or above $14,000 would induce selling as those holding a position at this level are probably not looking to sell.

A break above $14,000 also represents a new 2019 all-time high and the news event surrounding this event could lead to an influx of capital from investors of various ilk. 

In combination, these factors make a strong bullish case for Bitcoin price in the run up to the May 2020 halving. 

Tether issuance does not immediately impact market 

However, FilbFilb also cautions that: 

“On lower time frames, the Adam and Eve target remains to play out, with $12.9k being the target.” 

Using Y=0.0002x+1.161, FilbFilb concluded that the correlation between Tether and Bitcoin is 0.89. 

Therefore, when applied to Tether’s current market cap of $4.34 billion, the model suggests that the price of Bitcoin should be somewhere around $20,000. 

When the same calculation is used without the 32-day re-anchoring, the result was still a 0.8 R-squared. Y=0.0003x + 0.9695 gies a BTC valuation of $13.500, which according to this year’s all time high, isn’t too far off the mark. 

Correlation between Bitcoin and Tether statistically significant 

Admittedly, there are a few caveats which the analyst sufficiently addresses: 

  • The Tether / Bitcoin analysis is solely reliant up data from 236 days and correlation does not a pure determination of causation.

  • Similar to other stablecoins, issued Tethers could be burned at any moment.

  • More Tethers could be printed at any moment, and USDT does not represent the entire crypto market supply of stablecoins. Furthermore, Tethers are used for more than simply purchasing Bitcoins.

  • If Bitcoin’s market cap continues to grow, the formula and analysis will require adjustment as the current 1 billion Tether issuance’s impact on a $70 billion Bitcoin market cap will have a different impact on a larger or smaller Bitcoin market cap.

Ultimately, what is worth noting is that there is a statistically significant correlation between Bitcoin price and Tether’s market cap. 

Thus, one can infer that Bitcon’s price could be correcting upwards from its current value of $11,500 given the market cap of Tether and the 1 billion in USDT issuances this year. 

“An additional $1 billion market cap could potentially move price by around $5K USD,” adds FilbFilb.  

But while FilbFilb cautions that he is not comfortable making prediction of a $20,000 Bitcoin price today, he is confident that: 

“There’s statistical evidence to suggest that there are enough Tethers in issuance to make a directional move towards it, should they get deployed in that way.”

Macro-economic factors support the case for a bullish Bitcoin

As previously reported by Cointelegraph, a series of worsening macro-economic factors are presenting challenges for traditional markets. But these issues also appear to be supporting Bitcoin’s allure as a store-of-value investment and hedge against market volatility within traditional markets. 

Bitcoin’s growing correlation to Gold, China’s yuan devaluation, Brexit, global monetary easing on part of numerous central banks, and negative bond yields are all driving investors to view Bitcoin as a hedge against volatility.

As Cointelegraph reported several weeks ago, Digital asset research firm Delphi Digital found that the current macroeconomic landscape is creating the “perfect storm” to ignite Bitcoin price appreciation.

“The relative size of Bitcoin’s market value compared to the investible gold market, for example, makes it a tempting opportunity for investors starving for assets with above-average growth potential as well,” the researchers note. 

Therefore, it’s no surprise that investors may be increasingly turning to Bitcoin — and Tether as an easy way to access this digital gold — in the coming months as storm clouds continue to gather over the global economy.


Coinbase Says It Prevented a Crafty Phishing Attack to Exfiltrate Keys


Marie Huillet reports:

The security team at cryptocurrency exchange Coinbase has revealed how it countered a sophisticated phishing attack aiming to exfiltrate private keys and passwords. 

In a blog post published on Aug. 8, the exchange outlined its discovery and reporting of the incident, which involved the exploitation of two 0-day vulnerabilities on Mozilla’s web browser Firefox.

A “highly-targeted and thought-out” attack

The first steps of the phishing scam, Coinbase reveals, date back to late May of this year, when over a dozen exchange employees received an email from an innocuous-seeming University of Cambridge “Research Grants Administrator.” Coming from a legitimate Cambridge academic domain, the email — and similar subsequent emails — passed security filters undetected.

The emails’ tactics changed, however, by mid-June: this time, the correspondence contained a URL that, when opened in Firefox, could install malware on the recipient’s machine.

Coinbase notes that within hours of receiving this email, it successfully detected and cooperated with other organizations to counter the attack. At the time of the incident, the exchange had emphasized that it had found no evidence of the campaign targeting Coinbase customers.

Over 200 individuals in total, across several — unnamed — organizations other than Coinbase, were eventually found to have been targeted. 

Key takeaways

Coinbase notes the attackers bode their time, sending multiple legitimate-seeming emails from compromised academic accounts, all of which referenced real academic events and were closely tailored to the specific profiles of phishing targets. After these rounds of correspondence, they attempted to infect just 2.5% of targets with the URL hosting the 0-day.

The exchange reveals that as soon as both an employee and automated alerts flagged up the suspicious mid-June email, its response team found a swift way to counter the threat, capturing the 0-day from the phishing site while it was still live and in this way aiming to conceal the response from the attackers’ attention. The blog post adds:

“We also revoked all credentials that were on the machine, and locked all the accounts belonging to the affected employee. Once we were comfortable that we had achieved containment in our environment, we reached out to the Mozilla security team and shared the exploit code used in this attack.”

Mozilla, for its part, patched one of the two vulnerabilities by the next day, and the second within that same week.

Last month, Cointelegraph reported on the arrest of an Israeli citizen who allegedly stole $1.7 billion worth of cryptocurrency via a phishing campaign targeted at European users.


Crypto Tax Bill Introduced in the US House of Representatives


Ana Alexandre reports:

A tax bill seeking to allow the exclusion of gain or loss on like-kind exchanges of virtual currency has been introduced in the United States House of Representatives.

To amend the Internal Revenue Code of 1986

The bill dubbed the “Virtual Value Tax Fix Act of 2019” was initially introduced by Rep. Ted Budd (NC-R) on July 25 and referred to the Committee on Ways and Means. The bill seeks to introduce amendments to the Internal Revenue Code of 1986, which specifically determines:

“No gain or loss shall be recognized on the exchange of real property held for productive use in a trade or business or for investment if such real property is exchanged solely for real property of like kind which is to be held either for productive use in a trade or business or for investment.”

The bill is seeking so that “the exchange of virtual currency for virtual currency of like kind shall be treated in the same manner as the exchange of real property for real property of like kind.”

In effect, if the bill became law, it would preclude cryptocurrencies from double taxation under the Internal Revenue Code. 

“The Safe Harbor”

In July, U.S. Congressman Tom Emmer reintroduced his Safe Harbor for Taxpayers with Forked Assets bill in order to foster blockchain industry growth in the U.S. by lessening the burden on businesses to figure out relevant tax laws. In Emmer’s own words, “taxpayers can only comply with the law when the law is clear.”

The Safe Harbor bill is not intended to eliminate taxes on a hard-forked blockchain, but aims to provide a safe harbor to investors who do not properly account for a hard fork in calculating their tax returns.

Budd previously testified to the House of Representatives Ways and Means Committee on purported issues with current tax laws on cryptocurrencies in June. Budd argued that cryptocurrencies should have a de minimis tax exemption like foreign currencies.


UN: Hacked crypto funds weapons of mass destruction


William Suberg reports:

North Korea has netted around $2 billion by hacking banks and cryptocurrency exchanges, according to the United Nations.

In a confidential report acquired by mainstream media outlets including Reuters on Aug. 5, the U.N. Security Council North Korea sanctions committee said that hackers formed an essential part of government funding. 

“Democratic People’s Republic of Korea cyber actors, many operating under the direction of the Reconnaissance General Bureau, raise money for its WMD (weapons of mass destruction) programs, with total proceeds to date estimated at up to two billion US dollars,” Reuters quoted the report as stating.

As Cointelegraph previously reported, Pyongyang regularly forms the main suspect in investigations over attacks on exchanges in nearby Asian countries.

In particular, the entity known as the Lazarus Group has become notorious for its malign activities, which have affected countries across the world.

No end to sanctions in sight

South Korea appears to be a specific target, however, the most recent event involving a phishing email scam in which hackers masqueraded as major trading platform UpBit. 

At the same time, the FBI reiterated the U.N. view that North Korea was deliberately stealing money in order to counter the effects of international sanctions, which the report now said were likely to remain due to a lack of progress in talks. 

“We call upon all responsible states to take action to counter North Korea’s ability to conduct malicious cyber activity, which generates revenue that supports its unlawful WMD and ballistic missile programs,” it added.


Macro Factors Creating ‘Perfect Storm’ to Drive Up Bitcoin Price: Report


Marie Huillet reports:

Digital asset research firm Delphi Digital says that the macroeconomic landscape is creating the “perfect storm” to ignite Bitcoin price appreciation.

Monetary easing, crypto peaking

In a fresh report cited by Forbes on August 1, the researchers isolate the dovish turn in global central banking policy as the stand-out factor likely to propel Bitcoin’s price skywards:

“First, and arguably most important, sentiment from global central banks took a drastic turn towards more dovish monetary policies. The Fed, ECB, BOJ, PBOC, and many others are now preparing market participants for more rate cuts and additional stimulus measures as they attempt to keep the current economic expansion going.”

Central bankers’ consensus around the need for quantitative easing stems a geopolitical landscape shaped by protracted trade tensions between the United States and China, disappointing GDP growth in Germany, and the anticipated aftershock of a possible no-deal Brexit.

The digital gold narrative

Beyond monetary easing, the increasing risk of fiat currency devaluation represents a longer-term catalyst that is likely to further drive the price of both Bitcoin and physical gold, the report argues. 

As is often discussed, Bitcoin’s scarcity by design and its potential to serve as a store of value in a faltering world economy has earned it the moniker of “digital gold” — a narrative consolidated in Delphi’s new analysis. 

In a discussion of the two assets, the report argues that the digital gold view is ever more relevant amid “extreme monetary policies and rising geopolitical tensions” and that:

“The relative size of Bitcoin’s market value compared to the investible gold market, for example, makes it a tempting opportunity for investors starving for assets with above-average growth potential as well.”

Delphi Digital, in fact, predicts that given its unique non-sovereign properties, the investible Bitcoin market could in future outgrow the current gold market — over $7 trillion as of fall 2018.

As reported just yesterday, a former top-level executive at Goldman Sachs has similarly predicted that Bitcoin’s market cap could hit around $8 trillion in future. 

Shared perspectives

Delphi Digital’s view of Bitcoin’s correlation with macroeconomic factors has been echoed by the likes of Anthony Pompliano, who recently stated that the European Central Bank’s expected dovish turn will be “rocket fuel” for Bitcoin. 

Also this summer,  the head of global fundamental credit strategy at Deutsche Bankremarked that central banks’ dovish policies are positively impacting “alternative” currencies such as bitcoin while hurting investment banks.


Iranian Police Seize Batch of 117 Smuggled Crypto Mining Machines

Concept of digital crypto mining

Ana Alexandre reports:

Iranian provincial police have arrested an individual smuggling in cryptocurrency mining machines, local news agency Fars News reported on July 31.

The Saveh Police Department's Anti-Trafficking Police seized a truck allegedly carrying 117 cryptocurrency mining machines to the value of 11.7 billion Iranian rials ($277,876 at press time).

According to Sardar Kiomars Azizi, a Police News Agency official, the police confiscated the aforementioned crypto mining equipment and arrested the truck driver.

Crypto mining in complicated regulatory territory

The news comes in the wake of the Iranian government’s authorization of cryptocurrency mining as an industrial activity in July. Now, entities engaged in the crypto mining will be required to seek a license from Iran’s Ministry of Industry, Mine and Trade.

The government’s decision nonetheless underscores that using cryptocurrencies for domestic transactions remains outlawed and that those engaged in the industry should bear responsibility for the risks without any guarantees from the government or local banking sector.

While mining may now be legal, Deputy President of the Islamic Republic of Iran Customs Administration Jamal Arounaghi recently noted that the agency has not issued any licenses for importing the equipment. 

Electricity costs and economic contribution

Also in July, the Iranian Economic Commission finalized an electricity pricing scheme for cryptocurrency miners. Energy Minister Homayoon Ha’eri did not elaborate on the exact price scheme, although he stated that the price is dependent on market factors such as fuel prices in the Persian Gulf.

The head of Iran Electrical Industry Syndicate, Ali Bakhshi, previously proposed a price of $0.07 per kilowatt hour for cryptocurrency miners. Mostafa Rajabi Mashhadi, the Energy Ministry spokesman for the power department, previously stated that the production of a single Bitcoin uses about $1,400 in state subsidies.

Governor of the Central Bank of Iran Abdolnaser Hemmati previously argued that digital currency miners in Iran should contribute to the country’s economy, rather than letting mined Bitcoin (BTC) escape abroad.