Episode 177 - Tether and other Crypto News
DescThis week's top story - Tether is in trouble again. Is this a tale of sound and fury signifying nothing like the Bitcoin Maximalists such as Adam Back would like you to believe? Or is there something more going on here? Before we get to that story we talk about Vitalik, Elon, some scams and more.ription
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Episode 177 - Flagship 70
This week's top story - Tether is in trouble again. Is this a tale of sound and fury signifying nothing like the Bitcoin Maximalists such as Adam Back would like you to believe? Or is there something more going on here? Before we get to that story we talk about Vitalik, Elon, some scams and more.
Coinbase Custody now offers their first chain swap with KIN. Offline storage and insurance coverage
NYTimes is now routinely reporting on crypto. In this case it's 1q theftsâ€”roughly 1.2 billion
Electrum wallet botnet infects 152,000 users, steals $4.6mill USD
In response to this, attackers then started DDoSing legitimate Electrum servers in an attempt to trick older clients into connecting to malicious nodes, while legitimate nodes becoming overwhelmed.
Ethereum.org has gone through a redesign relaunching as a work in project like Ethereum itself being iterated by the community just like Ethereum.
Vitalik and Elon chat on Twitter (Story 1)
- Elon Musk on Monday sent out a one word tweet, Ethereum. Then apparently said jk. Then Vitalik got involved and said to come to Devcon in Denver. THe internet erupted. How absurd is it that someone can just say one word on the internet and have the internet in an uproar.
- Then Elon asked what should be developed on Ethereum and Vitalik replied with a mini tweet storm on projects with different use cases he likes on the Ethereum platform
- MolochDAO, Ethereum Name Service, Ethresear.ch, Hurricaneguard.io were all named.
- then a bunch of trolls on twitter said dumb things about tesla and crypto. Justin Sun got in there to mention Tron, all the regulars (Pomp, Ari David Paul, Neeraj)
- hope something comes of it at some point
- Crypto_Brahma Scam - Brent
- I don't know anything about who this was before - but I looked into it a little bit because of this letter I came across on Twitter to his "group" .
- He ran a paid Discord group where you could join and get some trading advice and get gems from him. ONLY 35 MONTHLY MEMBERS....but he was actually running two of these exclusive groups simultaneously.
- It was called the fucking Moon Club
- Apparently at some point he decided to do a fund.
- ANNNNNNNND It's gone.
- Literally he took everyone's money, gambled it via a bad call on Margin trading, and then sent a letter saying that he'd totally get everyone their money back. He just needed to clear his head so that he could trade in a stress free environment. Timeline - 5 Months. LOLOL
- Article based on a report by company called CipherTrace, 'Q1 2019 Cryptocurrency AML Report'
- Estimates $356 million stolen, and payments from US based exchanges to offshore crypto wallets up 46%
- $16m from Cryptopia in January
- CoinBene and DragonEx (Singapore) combined $46m in March (ETH backed)
- Bithumb in S Korea $13m in EOS stolen and (allegedly) another $6m in Ripple
- Company described it as an "accident involving insiders" lol
- Coinbin also S Korea forced into bankrupcy after loosing $26m, blamed an insider
- And then there's QuadrigaCX...
- The report 'tentatively' categorized the $190m as theft as opposed to hack or exit scam
- Bottom line this money has to be cashed out in innovative ways to turn it into cash, and a lot of ways to exit US and European jurisdictions.
- Article concludes with a warning that "A tsunami of tough, global antimoney laundering and counter-terror financing regulations will â€œroll overâ€ the cryptocurrency ecosystem throughout the coming year",
- Even links to an article showing Finland just recently adopted AML regulation for crypto
But one thing to keep in mind......
Austin Transportation Partners With Iota Foundation to Develop Interoperability Ecosystem ADAM
- visions of a system in which every transit system can interact with the same payment app and a single digital identity
- this is the second partnership this week. the other is United Kingdom car manufacturer Jaguar Land Rover will use Iotaâ€™s distributed ledger to reward drivers with cryptocurrency for data reporting
- Iota and internet of things (IoT) firm EvrythngÂ announcedÂ a partnership to combine and apply their distributed ledger and IoT technologies to provide greater transparency for consumer goods supply chains
- BOA secured a patent on April 30 for a cryptocurrency risk detection system.
- On the basis of the system, a risk score will be levied on cryptocurrency transactions between a customer and a third party.
- 'Processor' would receive request for transaction with third party, then it can "perform a slew of functions, retrieve blockchain information, determine the value of crypto in the transaction or calculate the â€œrisk scoreâ€ of the transaction based on the preceding factors."
- BOA also filed for a patent for crypto storage system for business transactions (Aug 2018)
CoinMarketCap turned 6 yesterday - Adam
- transparency alliance for cryptos and exchange. Basically KYC
- list of 17 things for crypto and 24 for exchanges
- starts in june 14th
- CMC blocks explorers much like etherscan which will help users have more visibility into the blockchain
- merch shop
- finally have an Android app
- ios updated version (so the search function ACTUALLY works)
Main Story - Tether situation - Brent
- The NY Attorney General released a statement saying that, among other things, Bitfinex used Tether to mask a missing $850 Million of their assets.
- The response to the NYAG releasing this from Tether? Decidedly hand wavey - First it was from Bitfinex not Tether, but they're the same. They basically say that the money was "seized" and not hidden. They're setting up for the ol' "if they hadn't said anything it all would have been fine" defense.
- Lets do a recap of the Tether red flags, YES red flags.
- The original white paper is unequivocal in the backing of Tether - it will be backed on a 1:1 basis
- The Paradise Papers leak showed that Phil Potter and Giancarlo Devasini are both a part of There and Bitfinex.
- $30 Million dollars was "Stolen" but don't worry Tether won't be redeeming those Tethers so it's all fine.
- They hired and fired an auditor named Friedman LLP.
- They took any promise of getting audited out of their FAQ.
- A few months ago we reported this but it bears mentioning again - Tether took down it's 100% backed statement and replaced it with a new one. "Every tether is always 100% backed by our reserves, which include traditional currency and cash equivalents and, from time to time, may include other assets and receivables from loans made by Tether to third parties, which may include affiliated entities (collectively, â€œreservesâ€). Every tether is also 1-to-1 pegged to the dollar, so 1 USDâ‚® is always valued by Tether at 1 USD."
- Now it gets even worse.
- The Lawyer for Tether has admitted to the court in plain english that as of April 30, Tether is only about 74% backed by fiat equivalents, which is cash and short term securities.
- It looks like this "seized" amount is a line of credit from Tether to Bitfinex, which is most likely going to function as one of those cash equivalents.
- Tether did say that the terms of this credit line were negotiated "on an arms length basis on commercially reasonable terms"
- Both agreements were singed by the same guy - Giancarlo Devasini.
- Attorneys are arguing that Tether doesn't have to be 100% backed, it totally says so on the website.
- If BSV got delisted because CSW is an asshole, I'm really hoping the community would put pressure on the exchanges to delist Tether.
- They aren't.
- Bitcoin maximalists like Adam Back seem to be aligned with Tether her, even comparing it to fractional reserve banking saying that it's way better than them. Sometimes the Bitcoin community makes it really hard to like them.
- Finally - the ETH wallet on Bitfinex has been drained of 800k ETH in the last week, and they only have 1.1M ETH left. Good luck to all that have funds on there :(
Reddit User M0ountainDew - Dear Justin sun this is not a "comprehensive developer guide" this is just a list of where to buy Tron.
It's literally a list (barely any of them linked) in alphabetical order - but Binance is at the top over aBCC Exchange.
You know we like to keep you up to date on Substratum bullshit
Brian and William were posting again this week.
Substratum Deleted the Team Members page of their website.
Originally it could still be accessed directly just not clicked on from the main site.
Now it's gone completely
They also took down their whitepaper. Only "technical paper" is left.