Russia would legalize mining but would ban the receipt of rewards. The use of cryptocurrencies would be limited to inheritances, bankruptcies, and judicial executions.

About a month ago, Russian President Vladimir Putin gave the go-ahead to the Digital Financial Assets (DFA) law. Now there could be a potential reform that would legalize Bitcoin mining but would ban the incentives that miners receive for their activity.

A proposal to amend the law that the Finance Ministry made would ban all cryptocurrency transactions. Their use would be limited to three areas: inheritances, operations related to bankruptcies, and judicial executions.

According to local media, the reform intends to legalize Bitcoin mining. However, miners would not have permission to receive remuneration, since they would risk fines of up to 100,000 rubles (RUB) (corresponding to USD 1,300) and a seven-year prison sentence. In the case of legal persons, the penalty would amount to RUB 1 million (corresponding to USD 13,000).

Dmitry Sakharov, CEO of the Moscow Digital School, commented that the situation is difficult, and it is unclear how miners would receive the incentives. “Experts may try to develop some interesting legal structures, but all of them will involve significant risks if the application of administrative (fines) and criminal (prison) liability occurs.”

The intention to modify the recently approved law is contradictory since the incentives that miners receive are what keeps cryptocurrency mining afloat. The prohibition on the direct payment of incentives creates uncertainty since no one knows the mechanism that would compensate for the work that miners do to maintain the network.

Enthusiasts Mine While Russia Keeps Bitcoins

Attorney Anton Babenko noted that it would be “difficult to say how the rules that allow the use of mining equipment in Russia [also] prohibit the receipt of payment in digital currency.”

In this sense, it is possible to speculate a scenario in which miners continue to develop their work (those who accept it), but the reward bitcoins go to wallets that the government controls. The authorities would theoretically receive the funds, deduct taxes, distribute the rewards, and encourage the activity in the country.

The problem could arise if they do not present guarantees of transparency in the allocation of resources, which would generate corruption. Furthermore, the government would not have to transfer the bitcoins either, since they could decide to send fiat money instead of cryptocurrencies.

Interestingly, Jakhon Khabilov, head of the Sigmapool mining consortium, noted that only the smallest mining farms in Russia accept payment in cryptocurrencies. The largest ones receive payment in fiat currency through bank transfers.

According to Cambridge University records, Russia is the third country in the world with the highest processing power on the Bitcoin network, with almost 7% of the hash rate. China (with 65%) and the United States (with 7.2%) follow the Russian Federation.

The regulations that Russia is applying to Bitcoin and cryptocurrencies, in general, are creating further confusion. The country recognizes Bitcoin legally but maintains bans on its use as a payment method.

The government classifies it as an investment mechanism that is only accessible to qualified operators under the provisions that the central bank issues.

By Willmen Blanco

 At the beginning of June, Bitcoin Core got a proposal to change an allegedly racist term. This process was approved and also executed in the most recent version of this software client. This Sunday, a developer and contributor to Bitcoin Core made corrections in the modified term to get a more substantial solution of this notable racist connotation of a term in the software.

The social networks exploded. This event led some Bitcoin Core developers to speak out and even motivated one of its most relevant collaborators to consider the possibility of leaving the project. The change occurred this way: The term ‘Blacklist’ now needs to be ‘Blocklist’, it was proposed on June 4 at the main initiative of a user without previous contributions on GitHub under the pseudonym TrentZ, in the Bitcoin Core test section.

The proposal was accepted without any objection and Bitcoin Core inserted the command FILE_CHARS_BLOCKLIST in the public code by the developer Marco Falke on June 9.

This command is an active part of the native Bitcoin Core testing software; it’s a code that can be executed by the user-´programmer and its mission is to verify the correctness in every operation the clients make. It’s a continuous process to check the client closely and continually.

The command does not affect the operation of the client or its nodes. It also creates a system of preventive actions between the interaction of users or wallets and the compatibility with the programming language that is currently running. Falke said that this change is not able to affect the client’s performance, the implementation of this change is very lineal and balanced, and this will avoid any political debate or heat up a reputation over the exchange.

Why politics ara affecting Bitcoin Code Development?

The developer and researcher Ben Verret, created a new change directed to the blocklist. Its current name is Disallowed, arguing that the name blocklist is too dual and might be misinterpreted, this is a very justified action.“We need to create a discussion about how easy can politics invade Bitcoin. The objective of having made this correction (pull request) was to prevent this from happening again in the future,”

The event generated good comments and receptivity among GitHub users; they left tons of arguments about this very hot topic that is invading all social media and professional and non-professional environments and spaces.

 The validity of this discussion in different parts of the world also touches on Bitcoin Core, which is one of the foremost Bitcoin software clients.

Bitcoin Core developer could leave the project

In the morning hours today Wladimir Van der Laan, one of the most relevant developers in Bitcoin Core, stated that he would not continue collaborating with the project. “It sucks to see how many people act like a mob on a variable topic and then turn their hatred against Bitcoin Core. Apparently all the work done previously doesn’t count, and I’m definitely not getting paid enough to keep going”.

Until now, it has not been confirmed yet if its exit from Bitcoin Core has been finalized. Throughout this year, Bitcoin Core received the support and financing of various business groups, who brought its developers the juicy opportunity to dedicate themselves full time to this project.

 A high-grade example of this is the case of developer Marko Falke which received a grant of $ 500,000 from the OkCoin exchange. On the other hand, developer Peter Wuille moved to Chaincode Labs after retiring from Blockstream, which is the pioneering company he helped found in 2014. Since then, he made major contributions and grateful changes to the Bitcoin Core code.

By: Jenson Nuñez.

Cybercriminals prefer fiat money and other traditional criminal methods. Some groups that trade Bitcoin also favor exchanges with cash.

For years, the narrative that criminals preferably use cryptocurrencies way for money laundering has grown. However, a new report from the Society for Worldwide Interbank Financial Telecommunications (SWIFT) claims just the opposite. This financial organization considers that crypto-assets play an insignificant role in money laundering and restates that cash is still the most widely used method for such purposes.

“The number of identified cases of money laundering through cryptocurrencies remains relatively small, compared to the volumes of cash laundered through traditional methods,” said SWIFT in its report on the laundering of money from large-scale cyber robberies.

SWIFT is the organization that manages the interbank messaging system that almost all banks in the world use to transfer funds to each other. These institutions use it to transfer billions of dollars every day.

In recent days, SWIFT noted in its document that it has been stimulating research with the idea of understanding how banking institutions can better protect themselves from cyberattacks. In that search, they considered it significant to know about what happens to the stolen funds.

In this way, the report focuses specifically on knowing the techniques that cyber attackers use to launder money from successful attacks and how they prevent the tracking of those funds. The research shows that traditional methods such as the use of mules, front companies, and cash are the formulas that criminals use the most for money laundering.

The report adds that cybercriminals seldom make use of cryptocurrencies, or even of digital money.

Cryptocurrencies in Money Laundering

Authorities’ concerns regarding money laundering should point to the use of cash and the use of mules to move the stolen money, according to the SWIFT report. However, the document mentions some criminal groups that use cryptocurrencies, such as the Lazarus Group, which is allegedly directed by North Korean hackers to steal money.

SWIFT said that the Lazarus Group stole money from banks and then exchanged the funds into cryptocurrencies. They reportedly operated through different exchanges to hide their origin and then converted the crypto assets back into fiat currency before sending them to North Korea.

Another example is a gang from Eastern Europe that established its Bitcoin farm in East Asia. According to the report, this group used funds stolen from banks to operate the farm, generate Bitcoin, and then spent the mined coins in Western Europe. When the police gang arrested, SWIFT said that the authorities found 15,000 BTC valued at USD 109 million, two sports cars, and USD 557,000 worth of jewelry at the group leader’s home.

It is not the first time that investigations have noted that the use of cash is the method of money laundering that criminals prefer. In 2019, the ratio between US dollars related to money laundering and Bitcoin funds circulating on the darknet was 800:1, according to data from the cryptocurrency market monitoring portal Messari.

By Alexander Salazar

The system for making public purchases in Peru adopted blockchain technology in April 2019. Perú Compras uses the LAC-Chain blockchain of the Inter-American Development Bank.

In April 2019, the agency for the management of electronic public purchases “Perú Compras” implemented blockchain technology in its system. Since then, it has registered a total of 154,400 purchase orders.

The information, which appeared on the Perú Compras portal in recent days, adds that the amount purchased through the platform to date amounts to 1,540 million Peruvian soles (PEN) (equivalent to around USD 400 million).

According to the official website, the purchasing center is attached to the Ministry of Economy and Finance of Peru and emerged in 2008. The system became operational in 2016, and they decided to implement blockchain technology on April 15^th, 2019. On that date, it began to register the purchase orders of the electronic catalogs using this technology, to optimize the processes to make public purchases nationwide.

Perú Compras serves as a mediator between suppliers and traders in the Andean country, where buyers make a request and sellers make offers in a bidding system. In this way, the agency uses the blockchain to register the winning order and avoid alterations in any part of the process, from the signing of the contract between the parties to the delivery by the supplier.

The orders and their respective offers are registered on multiple servers (nodes) to ensure the inalterability of the information, according to the publication from the agency. “Each purchase order has a QR code that can be read by any smartphone, where the user accesses the original PDF file of the said order, thus verifying the authenticity of the document.”

Perú Compras Operates with IDB’s Support

The Perú Compras system runs on the Inter-American Development Bank (IDB) LAC-Chain blockchain testnet, based on ConsenSys Quorum. The IDB launched this ledger in October 2018 to purpose promote the development of the blockchain ecosystem in Latin America and the Caribbean.

The testing program with Perú Compras has the participation of the Peruvian startup Stamping.io, a platform that uses different public or permissioned blockchains to certify the traceability of goods.

At the time of initiating the tests, the founder of Stamping.io, José Zárate, commented that although they provide access to other public blockchains such as Bitcoin, Ethereum, and Litecoin, Perú Compras agreed to test the IDB network as a pilot.

The implementation of blockchain on Perú Compras is not the first case of the use of this technology that receives support from the international organization. Last February, the Mivivienda Fund, an entity attached to the Ministry of Housing of Peru, used LAC-Chain to register and certify the issuance of bonds for housing financing.

The IDB is also working with blockchain startup ChromaWay and Bolivian IT services company Jalasoft to test the blockchain in the land registry in Bolivia, Peru, and Paraguay. The goal is to extend the tests to other parts of South America.

By Alexander Salazar

The failure had its origin in the “overrun” system of the Soft Yearn Finance contract. The trader plans to donate USD 10,000 of what he earned to some initiative on Gitcoin.

The fever of decentralized finance (DeFi) platforms is growing as new flaws emerge that lead their users to lose their funds. One of the most recent was the failure of the DeFi project Soft Yearn Finance (SFYI), which began after the price boom on Yearn Finance (FYI).

Twitter user @A_mplify claimed to have caused the loss of almost all available liquidity in the SFYI contract in early September. An error in the SFYI contract gave him more than 740 ETH (cryptocurrency native to Ethereum).

He also alleged in his post that he was not aware of what was happening. He explained that he just took an opportunity in the user interface of the DeFi Uniswap platform, where SFYI is listed.

The trader stated that on that same day, he bought 0.5 ETH worth of SFYI through Uniswap. After having tripled his investment, he sold it, and then he put 0.5 ETH back into the token.

After that, he observed that the platform reflected more than 15,000 tokens equivalent to 747 ETH (around USD 250,000 at the time of writing this article) in his wallet. He thought that it was a mistake and that he would fail to send that transaction, but he did not.

Liquidity Redistribution to Maintain Price on YFI

The failure happened in the “overrun” system that modifies the circulating supply of the token to keep its value stable compared to YFI, according to the developers of the project. The idea is that SFYI is always equivalent to 0.0003 YFI.

The system burns tokens if the price is falling or inflates the supply if the opposite occurs, depending on the fluctuation of the price. The problem is not only that it seems to be dangerous, but also that SYFI holders do not own their private keys. The creators of the project say that this process repeats every 24 hours.

It was inevitable that this would happen, as the user claims. He considers that, if he had not done it with his transaction “of 500 gwei (processing fee), someone else would have done it (and probably did) with 490 gwei”.

The day after that, the team behind this DeFi project announced their position. They briefly stated on Twitter that they would recreate the SYFI token, redistribute the amounts that the wallets had before the error, and add a total of 250 ETH to liquidity. Finally, they said that they would correct the error in the override system that allowed the loss of funds.

Soft Yearn requested support in identifying the person responsible, for which they offered a “large sum of ETH” as a reward. Following the statements of the person involved, the creators of the platform have not issued a new communication.

Failures and Lost Funds in DeFi

This error is not the only case, since the proliferation of similar projects has been such that system failures have become common. For example, an error in the code affected YAM, blocking about USD 750,000 in tokens under its contract.

The user stated that he plans to donate USD 10,000 of what he obtained, which was “easily available and eager to get lost” to some cause on Gitcoin that needs financing.

Finally, he recommended that users not let such risky projects with few guarantees to carry them away. “I hope that we can investigate and invest in safer things next time,” he concluded.

By Alexander Salazar

Moderate job growth was announced by the US Bureau of Employment Statistics, with the creation of 363,000 new jobs. Expectations and hopes for the establishment of at least 1.4 million new jobs were not met, said a Reuters dispatch, so the report on the labor market was taken as a sign of a weaker economic outlook.

This weak outlook on the economy guided to an alarming decline in the main evidence and stocks related to the traditional market, also the bitcoin market, which saw its price fall by 12% in the week. Major tech companies, including Apple, the company with the largest market capitalization, suffered important losses, not seen since March this year.

Apple and its Accumulated Losses

The chain reaction to the fall of the main technology stocks is related to the great expectation of investors in companies such as Apple, Amazon, and Google. The New York Times was aware of that early before the crash, Apple had grown more than 90% for the year; Microsoft and Facebook almost 50%, and Alphabet almost 30%. Investors’ enthusiasm to share in those gains paradoxically helped precipitate Thursday’s slide.

In the case of Apple, the accumulated losses last Thursday and Friday subtracted about 312 billion dollars from its market capitalization value. The company founded by Steve Jobs had a market capitalization of $ 2.27 trillion last Wednesday and hit a low of $ 1.96 trillion on Thursday.

Via Twitter, Willy Woo responds to trader Sven Henrich, who criticizes the thesis that defends bitcoin as a safe haven asset. Henrich simply places a comparison of the evolution of the price of bitcoin with that of the S&P 500 index (US500) and argues that bitcoin follows a regular and similar pattern.

Willy Woo claims: “This is because BTC is a combination of a risky ‘new technology’ startup, growing exponentially, with a safe haven asset. It needs to exceed a trillion dollars in market capitalization to be robust enough to be seen as a generally accepted haven. This is not very far, as it is a digital asset that grows exponentially…”.

Currencies that are between four and five years without movement show slight growth.

The correction in the price of bitcoin does not alter the fact that this cryptocurrency has parameters and metrics that support its qualification as a safe haven asset. Among these parameters are the so-called HODL Waves, presented by Coin Metrics, which show how the BTC retainers or hodlers are segmented, by the age of the coins. That is, for the period that has elapsed since they were last moved. In the Coin Metrics graph, you can see the upper band (in purple) that represents the BTC that has not moved since mid-2011. This band is decreasing and currently represents approximately 10% of the BTC in circulation. As for the group of BTC that have not moved for five years or more, there is sustained growth.

The early adopters of Bitcoin, those who benefited the most from its return on investment, seem to have decided to sell part of their BTC and spend the fiat money obtained in return. Those who acquired bitcoins for 5 years or less seem to be in favor of the option of not selling.  This happens as they are realizing that the value of BTC has grown concerning the initial acquisition price, despite the fluctuations.

By: Jenson Nuñez.