By Reuters | Updated: 2 October 2021
Hackers stole from the accounts of at least 6,000 customers of Coinbase Global Inc, according to a breach notification letter sent by the cryptocurrency exchange to affected customers.
The hack took place between March and May 20 of this year, according to a copy of the letter posted on the website of California’s Attorney General.
Unauthorized third parties exploited a flaw in the company’s SMS account recovery process to gain access to the accounts, and transfer funds to crypto wallets not associated with Coinbase, the company said.
“We immediately fixed the flaw and have worked with these customers to regain control of their accounts and reimburse them for the funds they lost,” a Coinbase spokesperson said on Friday.
The hackers needed to know the email addresses, passwords and phone numbers linked to the affected Coinbase accounts, and have access to personal emails, the company said.
Coinbase said there was no evidence to suggest the information was obtained from the company.
News of the hack was earlier reported by technology news portal Bleeping Computer.
© Thomson Reuters 2021
Dogecoin Jumps After Elon Musk Tweets Tesla Merchandise ‘Buyable’ With the Token
By Reuters | Updated: 14 January 2022
Meme-based cryptocurrency Dogecoin jumped on Friday after Tesla chief Elon Musk said the electric carmaker will accept it as payment for merchandise.
“Tesla merch buyable with Dogecoin,” Musk tweeted.
Tesla merch buyable with Dogecoin
— Elon Musk (@elonmusk) January 14, 2022
His mid-December tweet saying such use of Dogecoin will be allowed on a test basis sent the cryptocurrency up more than 20 percent. Dogecoin price in India stood at Rs. 15.02 as of 4:30pm IST on January 14.
Dogecoin, popular among retail investors, raced up 18 percent to above $0.2 (roughly Rs. 14) after Friday’s tweet.
Musk’s tweets on the cryptocurrency, including the one where he called it the “people’s crypto”, buoyed the meme coin and caused it to soar roughly 4,000 percent in 2021.
In other Tesla-related news, Musk tweeted on January 13 that Tesla is “still working through a lot of challenges with the government” in India. Musk said this in response to a question on when it would launch its electric cars in the country.
Tesla had plans to begin selling imported cars in India last year and has been lobbying the government to slash import taxes on electric vehicles (EVs) before it enters the market. In October, it took its demands to Indian Prime Minister Narendra Modi’s office.
Musk didn’t identify the “challenges” being worked on in his Twitter post.
© Thomson Reuters 2022
Jack Dorsey Fintech Firm Block Wants Bitcoin Mining for All
By Agence France-Presse | Updated: 14 January 2022
Jack Dorsey on Thursday announced that his digital payments firm Block is building a system to make it easier for people to mine Bitcoin.
Dorsey said in a tweet that Block, formerly known as Square, is “officially building an open Bitcoin mining system,” following through on an idea floated publicly late last year. Bitcoin price in India stood at Rs. 34.11 lakhs as of 12:00pm IST on January
In November, Twitter co-founder Dorsey announced his departure from the social media platform, allowing him to concentrate on his digital payments firm as it expands into cryptocurrency.
Block changed its name from Square late last year to denote a broader mission that includes blockchain and economic empowerment.
Hardware and software teams at Block will openly collaborate with the cryptocurrency community outside the San Francisco-based company, aiming to create a mining system that could be used by anyone, according to Dorsey’s tweets.
Block hardware general manager Thomas Templeton said on Twitter that the project’s aim was: “To make mining more distributed and efficient in every way, from buying, to set up, to maintenance, to mining.”
“We see it as a long-term need for a future that is fully decentralised and permissionless.”
No timeline was given for when Block’s system might be ready. Block is also working on a wallet for storing cryptocurrency, using similar open collaboration.
“For most people, mining rigs are hard to find,” Templeton said in a tweet.
“How can we make it so that anyone, anywhere, can easily purchase a mining rig?”
The price of Bitcoin hit record highs in 2021 thanks to support from traditional finance. But it slid below $40,000 (roughly Rs. 30 lakh) on Monday, falling to its lowest level since the end of September as the world’s leading cryptocurrency showed no end to its volatility.
Created following the 2008 global financial crisis, Bitcoin initially promoted a libertarian ideal and aspired to overthrow traditional monetary and financial institutions such as central banks.
In more recent times, climate change watchers have shone a spotlight on the huge amount of electricity used to power computers required to unearth new Bitcoin tokens.
Digital Pound Could Hit Financial Stability and Erode Privacy, UK Lawmakers Warn
By Reuters | Updated: 13 January 2022
A digital pound used by consumers could harm financial stability, raise the cost of credit, and erode privacy, though a version for wholesale use in the financial sector demands greater appraisal, British lawmakers said on Thursday.
Britain’s central bank and finance ministry said in November they would hold a consultation this year on whether to move forward on a central bank digital currency (CBDC) that would be introduced after 2025 at the earliest.
Central banks across the world have stepped up work on CBDCs to avoid the private sector dominating digital payments as cash use falls. The prospect of widely-used cryptocurrencies issued by Big Tech has also galvanised such efforts.
But an e-pound used by households and business for everyday payments could see people move cash from commercial bank accounts to digital wallets, said the report by a committee in the House of Lords, parliament’s unelected upper chamber.
That could spark financial instability in times of economic stress and increase borrowing costs as a key source of lenders’ funding would dry up, it said.
A digital pound could also harm privacy, the report added, by allowing the central bank to monitor spending.
“We were really concerned by a number of the risks that are posed by the introduction of a CBDC,” Economic Affairs Committee Chair Michael Forsyth told Reuters.
Many benefits for the consumers could be “achieved by alternative means with fewer risks,” Forsyth said, pointing to regulation as a better tool to ward off the threat of crypto issued by Big Tech firms.
However, a wholesale CBDC used to transfer large sums could make securities trading and settlement more efficient, the report said. Britain’s central bank and finance ministry should consult on its advantages over the expansion of the existing settlements system, it said.
Britain’s parliament should have the final say on any decision to launch a e-pound, the report said, calling for lawmakers to also vote on its governance.
A CBDC would have “far-reaching consequences for households, business and the monetary system,” Forsyth said. “That needs to be approved by parliament.”
© Thomson Reuters 2022
NFT Sales Hit $25 Billion in 2021, But Growth Shows Signs of Slowing
By Reuters | Updated: 11 January 2022
Meanwhile, some of the world’s top brands, including Coca Cola and Gucci, have also sold NFTs.
NFT sales volume totalled $24.9 billion (roughly Rs. 1,83,960 crore) in 2021, compared to just $94.9 million (roughly Rs. 700 crore) the year before, DappRadar, said on Monday. DappRadar collects data across ten different blockchains, which are used to record who owns the NFT.
Estimates of volumes vary by different data provider, depending on what is included. Transactions which take place ‘off-chain’, such as major NFT art sales at auction houses, are often not captured by the data.
CryptoSlam, which also tracks multiple blockchains, said the 2021 total was $18.3 billion (roughly Rs. 1,35,250 crore). NonFungible.com, which tracks the Ethereum blockchain only, put 2021 sales at $15.7 billion (roughly Rs. 1,16,030 crore). Ethereum price in India stood at Rs. 2.5 lakh as of 11:20am IST on January 11.
This means the money spent on NFTs in 2021 is roughly equivalent to the amount pledged at COP26 to help countries phase out coal, or the funding made available by the World Bank to buy and deploy COVID-19 vaccines.
Sales peaked in August, then declined in September, October and November before picking up again in December, data from the biggest NFT marketplace, OpenSea, showed.
This does not appear to be correlated with fluctuations in the price of cryptocurrencies, which are often used to buy NFTs, as bitcoin and ether rose in the September to November period.
Around 28.6 million wallets traded NFTs in 2021, up from some 545,000 in 2020, DappRadar said.
While some see NFTs as the future of ownership in the online world, buying NFTs as a vote of confidence in the development of “Web3” or the metaverse, others are baffled as to why so much money is being spent on items which do not physically exist.
Just 10 percent of traders accounted for 85 percent of all NFT transactions, research published in the journal Nature said.
While the most expensive known NFT sale was $69.3 million, a common price range was $100 (roughly Rs. 7,390) to $1,000 (73,900), NonFungible.com said.
Prices of the most sought-after NFTs were highly volatile. The average sale price of a CryptoPunk image rose from around $100,000 (roughly Rs. 73 lakh) in July to nearly $500,000 in November. By December it had fallen to around $350,000 (roughly Rs. 2.5 crore), CryptoSlam data shows.
Collectible NFTs were the most popular category, followed by art, NonFungible.com said. Some of the most eye-watering NFT sales have been for land in online metaverse environments.
Virtual real estate investor Republic Realm bought land in the virtual world The Sandbox for $4.3 million (roughly Rs. 30 crore) in November.
© Thomson Reuters 2022
GameStop Jumps After Report on NFT Trading Hub, Crypto Pact
By Reuters | Updated: 8 January 2022
GameStop’s stock rallied on Friday after a report that the videogame retailer plans to expand its non-fungible tokens (NFTs) marketplace and partner with crypto firms.
The company’s shares soared last year as it was at the centre of a battle between small investors coordinating on online forums and Wall Street hedge funds that had taken short positions. Since mid-November, its stock has mostly declined.
On Friday, GameStop jumped 7.3 percent to $140.62 (roughly Rs. 10,440) after reports late on Thursday that the company would build an online hub for trading NFTs for virtual game collectibles and establish cryptocurrency partnerships.
A source familiar with the matter told Reuters about GameStop’s plans, which had been reported by the Wall Street Journal.
GameStop declined to comment on the reports.
NFTs, which use blockchain to record the ownership of digital items such as images and videos, surged in popularity in 2021, leaving many confused about why so much money was being spent on copiable digital items that do not physically exist.
Highly volatile crypto assets have tumbled in recent months, with Bitcoin plummeting to a more than three-month low of $42,001.97 (roughly Rs. 31.18 lakh), down about 38 percent from its $69,000 (roughly Rs. 51.21 lakh) all-time high in November. Bitcoin price in India as of January 8 at 11:15am IST was Rs. 33.92 lakh.
Ether, used to buy NFTs, has slumped to $3,219.77 (roughly Rs. 2.39 lakh), levels last seen in early October. Ether price in India as of January 8 at 11:15am IST was Rs. 2.6 lakh.
“Meme stocks are speculative rather than fundamental and, to a degree, cryptos are also little speculative in nature … too much of an exposure to cryptos could have an effect on the balance sheets of these companies,” warned Mirabaud analyst Neil Campling.
Short selling against GameStop increased by about 1 million shares to 8.4 million in the past 30 days, now worth $1.11 billion (roughly Rs. 8,240 crore) and equivalent to 13 percent of GameStop’s free float, according to data from S3 Partners.
Ihor Dusaniwsky, managing director of predictive analytics at S3 Partners, said Friday’s share move was unlikely to be a short-covering rally.
“First we would need to wipe out recent mark-to-market profits on the short side, which means getting back to levels in the $170 – $200 (roughly Rs. 12,600 to 14,800)stock price range,” for a short squeeze to happen, Dusaniwsky said.
© Thomson Reuters 2021
Bitcoin Network Computing Power Slumps as Kazakhstan Crackdown Hits Crypto Miners
By Reuters | Updated: 7 January 2022
The global computing power of the Bitcoin network has dropped sharply as the shutdown this week of Kazakhstan’s Internet during a deadly uprising hit the country’s fast-growing cryptocurrency mining industry.
Kazakhstan became last year the world’s second-largest centre for Bitcoin mining after the United States, according to the Cambridge Centre for Alternative Finance, after major hub China clamped down on cryptocurrency mining activity. Bitcoin price in India stood at Rs. 33.5 lakhs as of 10:20am IST on January 7.
Russia sent paratroopers into Kazakhstan on Thursday to help put down the countrywide uprising after violence spread across the tightly controlled former Soviet state. Police said they had killed dozens of rioters in the main city Almaty, while state television said 13 members of the security forces had died.
The Internet was on Wednesday shut down across the country in what monitoring site Netblocks called “a nation-scale Internet blackout”.
The move would have likely prevented Kazakhstan-based miners from accessing the Bitcoin network.
Bitcoin and other cryptocurrenices are created or “mined” by high-powered computers, usually at data centres in different parts of the world, which compete to solve complex mathematical puzzles in a highly energy-intensive process.
In August last year, the most recent data available, Kazakhstan accounted for 18 percent of the global “hashrate” – crypto lingo for the amount of computing power being used by computers hooked up to the Bitcoin network.
In April, before China’s latest clampdown on Bitcoin mining, the figure was just 8 percent.
The hashrate at major crypto mining pools – groups of miners in different locations that team up to produce Bitcoin – including AntPool and F2Pool was on Thursday at 1215 GMT (5:45pm IST) down around 14 percent from its level late on Tuesday, according to data from mining firm BTC.com. Neither pool immediately responded to a Reuters request for comment,
Crackdown on cryptocurrency mining
Yet a drop in hashrate isn’t necessarily supportive for the price of Bitcoin.
Bitcoin fell below $43,000 (roughly Rs. 32 lakh) on Thursday, testing multi-month lows after investor appetite for riskier assets fell as the US Federal Reserve leant toward more aggressive policy action.
The more miners on the network, the greater the amount of computer power is needed to mine new Bitcoin. The hashrate falls if miners drop off the network, in theory making it easier for the remaining miners to produce new coin.
Kazakhstan’s cryptocurrency mining farms are mostly powered by ageing coal plants which themselves – along with coal mines and whole towns built around them – are a headache for authorities as they seek to decarbonise the economy.
The Kazakh government said last year it planned to crack down first on unregistered “grey” miners who it estimates might be consuming twice as much power as the “white” or officially registered ones.
Its energy ministry said last year “grey” mining may be consuming up to 1.2 GWt of power, which together with “white” miners’ 600 MWt comes up to about 8 percent of Kazakhstan’s total generation capacity.
The country’s uprising began with protests in the west of the country against a New Year’s Day fuel price hike.
© Thomson Reuters 2022
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