Ethereum classic, a spin-off of the world’s second most popular cryptocurrency, has been hit by a series of major attacks on its blockchain network.Unknown hackers made away with more than $1.5 million (£1.2m) by performing a so-called 51 per cent attack on ethereum classic’s underlying technology. Popular cryptocurrency exchange Coinbase was forced to cease trades of ethereum classic as a result of the attack. Coinbase told its users in a blog post that more than $1.5 million had been lifted by hackers through the double spend event.
In a recent blog post by Coinbase outlining the incident they stated “Coinbase detected a deep chain reorganisation of the ethereum classic blockchain that included a double spend, In order to protect customer funds, we immediately paused interactions with the ETC blockchain. Subsequent to this event we detected… additional reorganisations that included double spends. We will continue to monitor the status of the network.” A 51 per cent attack is technically possible on any cryptocurrency, though by its nature it is very difficult to carry out. It involves taking control of more than half of the network’s mining computer power, which is used to both generate new units of the cryptocurrency and confirm transactions on the network. This allows for something called ‘double spend’, whereby whoever is in control of the network can spend units of the cryptocurrency twice.
Bullish Key Players
Changpeng “CZ” Zhao, the industry golden child behind Binance, noted that his “wish finally came true,” as volatility actually pushed cryptocurrency higher. Zhao’s innocuous comment comes after market volatility pushed down BTC by upwards of 40% in the past two months. The Binance chief didn’t give any solid predictions but considering the set of comments CZ conveyed to Bloomberg, it is likely he’s still optimistic for this nascent sector.
The so-called “Crypto Dog,” a leading analyst that sports over 100,000 followers on his Twitter account, explained that there’s a chance this move isn’t “incredibly bullish” for BTC just yet. However, the preeminent analyst explained that all things considered, “alt setups” have been making him feel “more and more bullish.” And when altcoins run, so does Bitcoin.
Bitlord, an Australian crypto commentator and media personality, echoed the sentiment that “altcoins,” namely Ethereum, Litecoin, and Tron, have been interesting to watch, especially in terms of their correlation with BTC. Considering the jaw-dropping performance posted by the aforementioned crypto assets, Bitlord noted that he fully expects for Bitcoin to break higher in the days to come, adding that he put his money where his mouth is, so to speak. Like his fellow commentators, Bitlord didn’t provide a concrete price target.
Trader Tommy Mustache took this opportune surge to claim that BTC is unlikely to fall below $3,000, as once stipulated by Morgan Creek Digital Assets founder Anthony Pompliano, who infamously claimed that lower lows are inbound.
Kotak Mahindra Bank — India’s second largest private sector bank by market cap is allegedly requiring account holders to refrain from dealings in cryptocurrency. The claim was made by Twitter user “Indian CryptoGirl” (@Desicryptohodlr) in a tweet posted on January 8th. According to the screenshot provided in Indian CryptoGirl’s tweet, Kotak Mahindra Bank makes explicit reference to the Reserve Bank of India’s regulations in its apparent terms and conditions for account holders, which allegedly demand consent to the following: “Basis [sic] the regulations issued by RBI, I hereby declare that I will not deal with any transactions related to cryptocurrency including bitcoins. I also understand and agree that the bank reserves all right to close my account without further intimation in case I am found to undertake such transactions.”
On January 7th, activists of the French grassroots political movement the Gilets Jaunes — Yellow Vests — announced a bank run via social media, essentially hoping to meet their goals by destabilizing the local financial system. Dubbed the “Collectors’ Referendum,” the movement’s latest demonstration calls on supporters to withdraw their savings from financial institutions on Saturday, January 12th. While the political action does not mention cryptocurrencies, it seems that such a run on the banks could hypothetically affect the crypto market and vice versa. A bank run entails a lot of people withdrawing their money from a given bank. It normally happens when investors start to feel that their bank may cease to operate in the near future. As a result, a fractional-reserve banking system in which banks keep part of their assets locally, usually at least equal to a fraction of their deposit liabilities becomes challenged, while people start opting for other assets instead of fiat: for instance, bonds, precious metals or, theoretically, cryptocurrencies, as their decentralized structure might guarantee more independence from financial institutions.
CCN had a conversation with Prashanth Swaminathan, the founding CEO of XDAT, a new Malta-based crypto exchange with eyes toward India and other markets. A native of India, he is an adviser to the Eleven01 project, which is an attempt at developing a regulated native blockchain in the country. Swaminathan said that XDAT will help facilitate the token generation event that Eleven01 is still in the development stages for. XDAT is still in the beta phases of development. This model is similar to the approach of Huobi. The goal of XDAT is to make things as simple as possible for new users. Swaminathan believes that most crypto exchanges today are too complicated for mass adoption.
Last year saw the gavel drop harshly for cryptocurrencies as regulation in the industry increased substantially across the globe. Cryptocurrency companies have struggled to cope with these extreme conditions forcing some to close shop. Digital Crypto Group reported compliance and regulation to be the toughest challenge most companies faced in 2018 beating product-market fit challenges and capital constraints. Many called for governments around the world to work on a regulation that will boost creativity and innovation in the industry while limiting the bad participants in the industry. In the past, governments such as China and India have closed down their local exchanges citing malpractices and scams. However, people believe a more pragmatic approach could have been taken to keep the good cryptocurrency exchanges in place while driving away the rotten few.
The past year recorded an increase in institutional investment in the crypto space as more companies looked into integrating blockchain into their systems. Gaming is one of the key areas that has seen massive adoption of blockchain technologies in 2018. The global financial corporations including Goldman Sachs, JP Morgan, Santander Bank are heavily investing in the crypto space publicly. Others include Facebook, which recently announced to add a stable coin on its platform.
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