At the beginning of the year, the dominant narrative permeating cryptocurrency markets was that institutions were going to add large swaths of bitcoin to their assets. Big, established investors from hedge funds to Wall Street mainstays and blue-chip companies would be quick to jump on the bandwagon. 

Now, as bitcoin (BTC) trades close to half of the all-time high of almost $65,000 reached in April, things are starting to look slightly different: Despite what looks like a clearance sale on the cryptocurrency, data shows that institutions have shown a reluctance to take advantage of the bargain, apparently rattled by the same concerns that have pushed prices down. 

Bitcoin “whale” addresses – those holding 1,000 BTC or more – tumbled to about 2,150 in May from almost 2,500 in February, according to the blockchain-analysis firm Coin Metrics. Since then, the number has languished around that lower level. 

Glassnode, another blockchain analysis firm, noted in a report on Monday that a stagnation in the balance of bitcoins held on the cryptocurrency exchange Coinbase offers another view of the same dynamic. 

CoinDesk reported last week that open positions in bitcoin futures had tumbled by 59% from an April 13 peak, an indication that institutional investors are being cautious. 

“Institutional demand appears to remain somewhat lackluster,” Glassnode wrote in its Monday report. 

The latest data might show why bitcoin has been stuck between $30,000 and $40,000 for the past month, after prices had risen over the past year partly on the expectation that a wave of new buyers was set to come in. 

Signs continue to mount that institutions are preparing to pounce: The likes of BlackRock, Goldman Sachs, Morgan Stanley and JPMorgan are on the list of traditional financial institutions that have set up bitcoin funds and services in the past few months or that have acknowledged considering a move into cryptocurrency. On Tuesday, financial services firm TP ICAP announced it is launching a crypto-trading platform alongside the financial heavyweights Fidelity Investments and Standard Chartered. 

But nagging concerns over bitcoin’s potential environmental harm, a regulatory crackdown on bitcoin trading and mining in China and, more recently, a decline in the underlying blockchain network’s computational power appear to have given big investors pause. 

Another worry is the possibility that the U.S. Federal Reserve may tighten its monetary policy in an effort to fight inflation. The prospect of fast-rising consumer prices after trillions of dollars of central bank stimulus had been a key source of demand for bitcoin, because the cryptocurrency, with its hard-coded limits on new issuance, has been cast as a steady bulwark against dollar debasement. 

Cryptocurrency industry executives say they see few signs that investors are going away or liquidating en masse: 

Then there are the corporations.

At the beginning of the year, MicroStrategy was the first U.S. corporation to invest its dollarized treasury in bitcoin, and CEO Michael Saylor has since been viewed as an influential presence to emerge from corporate America among the bitcoin community. 

MicroStrategy’s investment kindled speculation that other big companies might follow suit. Guesses at the time pointed to Twitter, Tesla, Apple, Warren Buffett’s Berkshire Hathaway and even the burger chain Wendy’s.

MicroStrategy has kept up its buying, saying earlier this month that it is borrowing $500 million to purchase more bitcoin. And some small companies are still “active” in moving toward bitcoin, said John Todaro, vice president of crypto asset and blockchain research at Needham & Co.

But few additional big corporate buyers have materialized.

Bitcoin adoption announcements have “appeared to slow for larger companies,” Todaro said.

This story originally appeared on WIRED UK. 

A few weeks ago, Grill listened to El Salvador president Nayib Bukele’s announcement, at a Bitcoin conference in Miami, that the country would adopt Bitcoin as a legal tender—and shrugged it off as the usual politico bluster. When the country actually passed a law implementing Bukele’s promise on June 9, Grill packed his bags and descended to the Central American country. Despite the house’s slow internet and lack of hot water, he's optimistic.

As the CEO of Chainbyte—a company that manufactures Bitcoin ATM machines converting dollars into the cryptocurrency and vice versa—Grill decided to relocate his company’s production here from China. “We were having a lot of shipping problems with China,” he says. “We're gonna export them from here to the United States. But we're going to keep a lot of them here.” He expects that, as the Bitcoin law starts being applied on September 7, El Salvador’s demand for his machines will grow; he is already receiving inquiries from several local banks.

The passing of Bukele’s Bitcoin law has been met with skepticism and worry by essentially every financial institution on the planet, starting with the World Bank and the International Monetary Fund. Bitcoin’s volatility, exemplified by its plunge to about $30,000 this week, after grazing $65,000 in April, has been lambasted as a recipe for financial disaster. Citizens will be allowed to pay taxes in a currency that might depreciate in hours, suddenly draining the government’s coffers. Trust in Salvadoran government bonds is expected to be shattered. Anti-corruption experts worry that local and foreign gangs may take advantage of an announced governmental trust fund to swap bitcoin of dubious provenance with US dollars—El Salvador’s other currency, with which convertibility will be ensured. But one crowd has welcomed Bukele’s initiative with enthusiasm, and that is the bitcoin crowd.

Young, bearded, brash, and fluent in memes, 39-year-old Bukele always had the physique du role to cater to the laser-eye brigade. Since his Miami announcement, he has become a regular on Bitcoin podcasts and English-language crypto-confabs on Clubhouse. Building on his hobnobbing with the crypto-initiated, he has deftly landed more PR coups, announcing that anyone ready to invest 3 bitcoin (today, about $100,000) in El Salvador will be immediately granted permanent residency, and that capital gains on bitcoin will not be taxed. Bukele has also talked up the country’s volcanoes as ideal locations for Bitcoin miners hungry for cheap geothermal energy amid China’s crackdown on cryptocurrency. The volcano touting, in all its Bond villainesque glory, was bound to stick, and now a bunch of Bitcoin entrepreneurs sport volcano emojis—alongside El Salvador’s flag—in their Twitter bios.

The high point of El Salvador’s publicity offensive was the invitation of some 30 Bitcoin entrepreneurs to visit the country and meet with government officials, two weeks ago. Leading the delegation was Brock Pierce, a flamboyant former child actor and current cryptocurrency investor and advocate who last year ran for US president on a pro-technology platform. (Ahead of his visit, Pierce was mocked for tweeting the front page of a Spanish-language Long Island newspaper apparently reporting on his trip, which was nowhere to be found in the newspaper’s online archive. The front page eventually appeared in the archive two days later as a “special edition.”)

Pierce says he is impressed by the government’s drive. “This government is incredibly entrepreneurial,” he says. “They are like just getting things done at lightning speed.” He says that he is working to organize a “big conference” in the country. 

Lauren Bissell, a former Cambridge Analytica employee who later converted to blockchain and Bitcoin entrepreneurship, and was part of Pierce’s delegation, says she was “beyond impressed” by the government figures she met during the trip. 

Yet Bissel admits that the road map to Bitcoin adoption looks very ambitious. “There's going to be a lot of hours of no sleep. There's a lot of work to do,” she says. “But I think that the launch will go successfully.”

With the countdown to Bitcoin Day down to just 69 days, the nuts and bolts needed to make the cryptocurrency work as legal tender are still a mirage. Athena, a company that had been initially tipped to install 1,000 ATM machines in the country (and challenged by Bukele on Twitter to deploy 1,500) will start with just 14. Going from volcano emoji to reality will also take time. “What you have in El Salvador is, seemingly, an abundance of geothermal energy and, at least for the time being, a friendly jurisdiction,” says Alex Brammer, vice president of business development at Luxor, a cryptocurrency mining company. “Providing the infrastructure there is going to take years.” Even the Bitcoin law looks like unfinished business: Its redrafting of an entirely new monetary system is hastily sketched in two pages and 16 articles, which is why a more detailed regulation is expected to be issued soon.

What is really Bukele’s game? One oft-repeated case for his move is that Bitcoin would be “banking the unbanked.” That fusty mantra is usually balderdash, but it might have some merit here, as 70 percent of El Salvador’s population does not have a bank account or access to easy payment solutions. By this line of thinking, a government-backed Bitcoin wallet, as a smartphone app, could arguably reach more people than existing banking service providers do, and might offer a convenient, low-commission medium for the Salvadoran diaspora to send back remittances. A small-scale Bitcoin project in El Zonte—a seaside town in northern El Salvador—was moderately successful in making the local economy function more efficiently and is credited for inspiring Bukele. In this reading, Bukele is the edgy maverick wielding liberating technology to lift his people from the state of deprivation to which financial institutions have consigned it.

There are problems, however, with that narrative. Some have pointed out that only 45 percent of the country’s population has internet access—and that an internet connection will be required to use the app. Ricardo Barrientos, chief economist at ICEFI, a Guatemala-based research institute focused on fiscal studies, predicts that Bitcoin will be treated as a “weak currency,” with employers keeping their savings in dollars and using the more volatile Bitcoin to pay salaries to their workers. “This class divide could trigger social tensions—that’s a recipe for disaster,” Barrientos says. The report Barrientos cowrote for ICEFI on this subject subtly suggests that by making Bitcoin legal tender without installing any anti-money-laundering checks, the government plans to encourage a “certain kind of acquisitions or investments” by creating a parallel market where “opaque operations” can take place.

Barrientos expects Bukele to backtrack before September 7 under pressure from international financial institutions and of some of his own advisers. Were that not to happen, Barrientos hopes that Bitcoin won’t catch on among the population. “The best-case scenario for it is that no one uses it and everyone keeps using dollars, apart from some narcos,” Barrientos says. “Hopefully there will be a natural debitcoinization.”

Like other critics, Barrientos dismisses the whole enterprise under the rubric of Bukele’s dangerous antics. The president is widely criticized for his links to corrupt individuals and browbeating of the judiciary, all the while enjoying an incredible level of popular approval. For Barrientos, Bukele’s embrace of Bitcoin is just a “political show,” a bit of muscle-flexing aimed at demonstrating that “he can pass almost any law.”

A third way of looking at this falls somewhere in between the “Bukele-as-a-genius” and the “Bukele-as-Nero” arguments—and it is, simply, that Bukele loves the buzz. The cryptocurrency world is reeling from China’s repression of Bitcoin mining (over 60 percent of which was taking place in China as of April 2021). In the US, Bitcoin is in for a regulatory battering as nearly everyone from Elon Musk to Elizabeth Warren is chastising the technology for its energy consumption and potential involvement in criminal deeds. Bitcoin needs a safe redoubt, and along came El Salvador, ready to be just that. Regardless of whether El Salvador’s unbanked are eventually banked, if Bukele manages to get the crypto industry to come basking in El Salvador's sun for a while, he may color himself satisfied. Until recently El Salvador was mostly known for having the world’s highest murder rate—now, it has graduated to farsighted Bitcoin proving ground. Interestingly, neither Bissell nor Pierce or Grill appear worried by El Salvador’s crime or gang violence.

“Crime is a problem everywhere: violent crime, specifically. In my presidential run, you can see some of what I had to say about criminal justice reform,” Pierce says. “The best way to address these issues is typically by creating opportunity and economic prosperity.”

It is worth wondering whether the advent of cartloads of English-speaking, techno-literate bitcoiners on their shores will necessarily elicit Salvadorans’ joy. Pierce’s own initiative, launched in 2018, to establish a crypto hub in hurricane-stricken Puerto Rico was met with hostility by some locals. But El Salvador might be just the first of a string of small, relatively poor countries gunning for a piece of the spurned crypto-elite. Last week, rumors about Paraguay also making Bitcoin legal tender made the rounds, before legislators clarified that that was not the case, even if a “digital assets” bill is in the works. Panama is working on its own bill which, according to Aldo Antinori, cofounder of the Panama Digital Blockchain Chamber of Commerce, is likely not to focus only on Bitcoin and will be “broader” and “more inclusive” of other cryptocurrencies.

Pierce, who claims he has become the first port of call for many national leaders looking into Bitcoin’s opportunities, is bracing for a deluge of phone calls. “Panama, Brazil, Nicaragua—half of Latin America, almost half—is now looking into it. I mean, I was on the phone with another prime minister this morning,” he says. “It looks like El Salvador has just kicked off a chain reaction.”

This story originally appeared on WIRED UK. 

Investors are more interested than ever in cryptocurrency. Criminals are too.

Reports of cryptocurrency crimes have increased 312% per year on average since 2016, according to a report from Crypto Head, a cryptocurrency news outlet that used Federal Trade Commission data to analyze cryptocurrency crime trends in recent years. These crimes can include everything from hackers stealing investors’ coins to people falling for scams related to crypto investing.

A cold wallet — an offline device not connected to the internet— is the safest place to keep your crypto investment, according to experts.

Bitcoin has the most crime reports of any cryptocurrency, which makes sense since it’s also the oldest and most-widely held crypto. Beyond digital crimes, Bitcoin’s safety as an investment is often questioned thanks to the frequency and scale of its value fluctuations.

Despite an increase in fraud and theft, many experts tout the safety of Bitcoin investments — at least in terms of cybersecurity if not investment stability — thanks to secure blockchain technology. So, is investing in Bitcoin safe? Here’s what you need to know about Bitcoin’s safety as an asset and keeping your cryptocurrency secure if you invest.What to Consider Before Buying Bitcoin

First things first: The money you put into Bitcoin is not safe from value fluctuations.

Bitcoin is a volatile investment. If you’re looking for a “safe” investment with guaranteed returns, then don’t invest in Bitcoin — or any cryptocurrencies for that matter. Just over the past few months, the price of one Bitcoin has fluctuated between $30,000 and $60,000. Bitcoin isn’t the only volatile cryptocurrency, and other, smaller coins may be even riskier. 

“Understand that these are very volatile investments, so if big fluctuations cause you to lose sleep, this isn’t the space for you,” says Dan Herron, a CFP with Elemental Wealth Advisors in San Luis Obispo, California.

Experts recommend keeping any cryptocurrency investments to less than 5% of your portfolio for exactly that reason — and to make sure you’ve got a solid conventional retirement investment plan in the first place. It’s also recommended you have an emergency fund and pay down any high-interest debts before you put any money into Bitcoin or any other cryptocurrency.

(Read More: Here’s How Much of Your Investing Portfolio Should Be in Crypto, According to 5 Experts)

What Are the Risks Associated With Bitcoin?

The biggest security concern for many people when it comes to Bitcoin investing — like any other digital activity — is the risk of hacking and fraud. Cryptocurrency crimes are on the rise, according to data from the Federal Trade Commission, and resulted in a median loss of $1,900 per report between October 2020 and March 2021.

Often, reported crypto crimes involve scammers requesting payment in cryptocurrency, or sending unsolicited offers to help you make money or increase your holdings, according to the FTC. “One sure sign of a scam is anyone who says you have to pay by cryptocurrency,” the agency says. You should also avoid any unsolicited offers related to crypto; do your own research and buy your coins yourself using a reputable crypto exchange. Other types of scams to look out for

Initial coin offerings (ICOs) for fake cryptocurrencies

When a cryptocurrency is offered to investors before it’s launched to the market, it’s called an ICO (similar to a new stock’s IPO). But sometimes these new coin offerings can be fabricated, leading investors to put their money in a cryptocurrency that doesn’t actually exist. 

Always research any cryptocurrency before you invest. If it looks too good to be true, it probably is. Read the project’s white paper and check out the founders as part of your research. For most investors — and especially beginners — it’s smart to stick to established, popular coins like Bitcoin or Ethereum.

Crypto pump and dump schemes 

A small group of investors may pump a lot of money into a specific crypto, falsely inflating the price while convincing private investors to also invest. Then the original investors sell their shares for a profit before the price falls again. This type of scheme exists for more traditional investments, too.

Again, if an investment seems too good to be true, it probably is. Watch out for coins that have risen a lot in value without any clear reason why, the Crypto Head report recommends. This may be a sign of a pump and dump scheme.

How to Keep Your Bitcoin Safe

Hackers can gain access to individuals’ crypto wallets or breach entire cryptocurrency exchanges to steal their holdings. That’s why it’s essential to store your crypto in a safe place, and practice good digital security habits.

Cryptocurrency exchanges and third parties offer storage for your coins through hot wallets, which are secure, but still online (and therefore still susceptible to hacking). Crypto held on an exchange or in a wallet is not FDIC-insured like money in the bank. Make sure you trade and hold your crypto on a platform that offers robust security measures — including keeping a significant amount of holdings in its own cold storage and two-factor authentication for users. Some exchanges may even have private insurance policies in case of theft or hacking.

For the best protection against online fraud, many experts recommend cold storage through an offline device not connected to the internet, similar to a USB drive. But even cold storage comes with risks, like the possibility of losing access to your investment completely if you forget your password. 

(READ MORE: A Crypto Wallet Can Help Keep Your Coins Safe. Here’s How to Decide If You Need One)

Security vs. Privacy 

While you can take measures to secure your crypto holdings from hacking and theft, Bitcoin may not be any more effective at keeping your personal information private than any other traditional investment. 

“Security and privacy are two separate topics,” says Kiana Danial, author of “Cryptocurrency Investing for Dummies” and the personality behind @Investdiva on Instagram.

While trades you make in Bitcoin may be harder to trace than credit card purchases or direct bank withdrawals, Bitcoin transactions are not private. Bitcoin trades are tied to a hash code — a string of letters and numbers —  that are unique to you, says Ollie Leech, learn editor at CoinDesk, a leading cryptocurrency news outlet.  

“You’re really not anonymous, more like pseudonymous,” says Galen Moore, director of data and indexes at CoinDesk. While your activity isn’t directly tied to personal details like your social security number, the blockchain is public and there are ways that people can identify you.  

But even though Bitcoin transactions aren’t private, that doesn’t mean every user can see exactly how much everyone else has bought or sold. 

“In order to download the Bitcoin blockchain you would need massive, massive, computing capacity, like a supercomputer,” says Danial. “The day-to-day average Joe can’t go in and see what transactions are happening in the Bitcoin blockchain.” 

If you want total privacy when you transact, then neither Bitcoin nor Ethereum — the second largest cryptocurrency by market capitalization — are for you. Other smaller cryptocurrencies are designed for this total privacy, though experts recommend avoiding these lesser known cryptos as an investment.

(READ MORE: Ethereum: What You Should Know Before You Invest)

“With Bitcoin and Ethereum, all those transaction details being open is part of how the network is maintained as people watch,” says Moore. The open system helps the blockchain retain accountability. 

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Crypto lending platform BlockFi is cutting interest rates on a number of crypto asset deposits, just about three months after the company lowered rates in March.

BlockFi says its decision was made based on the changing market dynamics and borrowing demand from institutional investors.

But unlike the last time, other leading top crypto lending desks such as Genesis and Canada-based Ledn are not following BlockFi’s lead move, at least for bitcoin deposits. Some of the executives at the firms are seeing increased borrowing demand compared with the previous quarter, so they need to attract the deposits to lend them out.

BlockFi announced June 25 the lower interest rates on deposits of crypto including bitcoin, ether, chainlink, litecoin and a few others will go into effect July 1. The annual percentage yield (APY) for bitcoin deposits larger than 20 BTC, for example, will go down to 0.25% from 0.5%.

BlockFi, in the announcement, said the decision was made due to “shifting market conditions.” 

“Rates on cryptocurrencies held in BIA (BlockFi Interest Account) are primarily driven by demand by institutional investors for borrowing these assets,” Rishi Ramchandani, director of business development at BlockFi in Asia, told CoinDesk in an email response. “When institutional investors demand changes, that affects the rates we can offer our BIA clients.”

Ramchandani said borrowing demand from BlockFi’s clients “continues to be stronger than ever,” but that the tenure of the loans “has gone down” along with the rates.

BlockFi’s decision led to a string of snarky comments on Twitter. 

More significantly, other major lending desks told CoinDesk they are not planning to lower their rates in the near future.

“Genesis is not lowering bitcoin rates on July 1, despite BlockFi’s rate reduction,” Matthew Ballensweig, head of institutional lending at Genesis, wrote in an email to CoinDesk. “Genesis can still pay 2.0% and more with no maximum quantity, as it still sees a robust institutional bitcoin lending market.” Genesis is owned by Digital Currency Group, which also owns CoinDesk.

The Canadian crypto lender Ledn will also keep interest rates for bitcoin deposits unchanged, according to an executive at Ledn. Ledn’s APY for bitcoin accounts with at least 2 BTC is 2.25%. Ledn is cutting deposit rates on the stablecoin USDC to 9.5% from 12% starting on July 1.

Hong Kong-based crypto lender Babel told CoinDesk via a spokesperson that it is not lowering interest rates for bitcoin deposits. Babel cut rates for tether deposits in May.

All three companies told CoinDesk they are seeing increased bitcoin borrowing demand from clients.

Some traders are betting the premium between spot cryptocurrency prices and futures, which has flattened recently, could widen again. So they’re borrowing bitcoin to short the spot market against a long position in the futures market.

That’s a contrast with the “cash and carry” arbitrage strategy that some traders pursue when futures draw a significant premium to the spot price; in that case, they buy bitcoin and short the futures to bet on a convergence of the two prices when the futures contract matures.

“Given the compression in the near-dated futures and spot basis spread, there are actually more opportunities to deploy bitcoin than last month,” Ballensweig said.

In Genesis’s first-quarter report in 2021, the company cited the wide spreads between bitcoin futures and spot markets as one reason for “lackluster” borrowing demand in the quarter. The company dropped its interest rates in March along with BlockFi.

“Borrowing BTC to short spot and long futures to bet on a widening curve doesn’t make sense when the basis is trading wide,” the report read.

According to data source Skew, bitcoin’s July expiry futures listed on major exchanges such as Binance, Huobi, OKEx, Deribit and Kraken are currently drawing an annualized basis of -20% to 3%.

Mauricio Di Bartolomeo, co-founder of Ledn, said that a lowered interest rate for USDC helps to reduce the cost of bitcoin-backed loans.

Dan Burke, managing director of institutional sales in Asia-Pacific at BitGo, said decentralized finance (DeFi) offers another source of borrowing demand for bitcoin from institutional clients, who are looking to convert bitcoin to wrapped bitcoin. These “synthetic” versions of bitcoin are configured to run on the Ethereum blockchain, where they can be deployed in DeFi trading and lending protocols for extra returns or yield. 

“From our institutional client base, we are seeing quite the opposite” from BlockFi, said Gary Pike, director of sales and trading at B2C2. “This may be because we only deal with institutions whereas BlockFi deals with retail as well.”

BlockFi’s CEO Zac Prince recently said the average balance held in an account on the platform rose fivefold in the past year, with the average balance of a retail client having jumped from $10,000 to $50,000.

“BlockFi largely borrows from retail and lends to institutional,” BitGo’s Burke said. “Some of the other lending platforms are also trading the assets themselves. It’s up to the users to decide what is riskier.”

Another possible factor behind BlockFi’s decision is the so-called Grayscale Bitcoin Trust (GBTC) arbitrage trade, several market participants said.

The Grayscale arbitrage trade refers to a strategy used by investors to borrow bitcoin and deliver those to the trust in exchange for GBTC shares – relevant when the Grayscale trust shares used to trade at a premium to the net asset value (NAV) of the fund, which is more closely tied to the value of its assets, or the underlying bitcoin. 

After a six-month lockup, the shares could be sold in the secondary market to retail investors at a premium. After paying back the lender for the borrowed BTC, the investors would take the rest for profit. (Grayscale is also owned by DCG, CoinDesk’s parent company.).

As CoinDesk reported, BlockFi was one of the biggest GBTC holders as of February, when the company revealed that it holds $1.7 billion in shares of GBTC, about 5.66% of the total outstanding. 

Max Boonen, director and founder of B2C2, said in a recent interview with New Money Review that some firms had taken advantage of the GBTC arbitrage trade in order to offer attractive interest rates on crypto deposits. 

“They could borrow bitcoin from their clients (with or without collateral), put the bitcoin into GBTC, hold the GBTC shares for the six-month lock-up period, then sell them on the secondary market with a premium attached,” Boonen said.

At press time, GBTC shares are trading at a discount to the NAV, so the Grayscale carry trade has lost its charm.

The arbitrage trade “used to be a cash cow when GBTC was trading at a large premium,” said Jeff Dorman, chief investment officer at Los Angeles-based Arca.

BlockFi did not immediately respond to CoinDesk’s request for comment about GBTC trading.

On its Terms of Service page, BlockFi tells depositors:

BlockFi raised $350 million in a Series D funding round in March and there have been rumors it is raising another round of funds worth several hundred million dollars at a valuation near $5 billion.

Dorman speculated the additional funds might serve “until revenue opportunities return.” 

BlockFi declined to comment on the new funding round. But Andrew Tam, chief marketing officer at BlockFi, told CoinDesk his company is “on track” to exceed its $500 million revenue goal for 2021.

“BlockFi’s business is healthier than ever,” Tam said.

The company has faced challenges as it grows. Most recently, it incorrectly deposited to users’ accounts as part of a botched round of promotional payments. Instead of rewarding users with the stablecoin gemini dollar (GUSD) as planned, it sent BTC, sometimes millions of dollars’ worth, to certain users. In March, the platform was attacked with fake sign-ups and abusive language on its web page.

SlateStone Wealth chief market strategist Kenny Polcari provide insight into the markets, Bitcoin and big banks laying out their back-to-work plans. 

Bitcoin was trading lower by 0.1% on Wednesday morning.

The price was around $34,787 per coin, while rivals Ethereum and Dogecoin were trading around $2,382 and 23 cents per coin, respectively, according to Coindesk.

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There's another place where you can use cryptocurrencies to pay your tab.

The Pavilions Hotels & Resorts, a high-end hotels group, will begin accepting cryptocurrency to book accommodations on Wednesday, according to a press release reported by Coindesk.

The company is partnering with crypto payment services provider Coindirect to allow customers to book rooms using bitcoin, ethereum and 40 other digital currencies.

BITCOIN MINING OPERATION IN FINGER LAKES SPARKS LOCAL CONCERNS

Pavilions’ portfolio of 14 properties in Europe and the Asia Pacific region includes locations in Madrid, Rome, Lisbon, Bali, Thailand, Mongolia and the Himalayas.

If you are in El Salvador, be in the lookout for new cryptocurrency ATMs.

Athena Bitcoin, has made public its plan to install a total of 1,500 ATMs in El Salvador, as the activation date of the Bitcoin Law - approved last month - approaches, according to Reuters via the Latin America News Agency.

Dozens of test machines have been installed throughout the country. The plan is expected to cost $1 million.

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The Salvadoran territory already had an ATM installed in El Zonte, the region where Bitcoin Beach is located, and the second ATM in the country was installed on June 24 in La Gran Vía. 

A virtual currency guidance and advisory issued by the U.S. Treasury Department’s anti-money laundering (AML) unit on June 30, 2021 clarified regulatory expectations, riled some cryptocurrency players and signaled a potential new global standard for combating financial crime.

The statement added that the guidance “does not establish any new regulatory expectations” and “consolidates current FinCEN regulations, guidance and administrative rulings.” FinCEN has broad international reach to any business doing substantive business with U.S. persons and therefore international businesses need to be paying attention if they source cryptocurrency from U.S. exchanges or interact with U.S. consumers.

Any time FinCEN issues an advisory, compliance officers in both banks and virtual currency companies will spend a fair amount of time over the next few days reviewing the advisory in the context of their businesses and customers. Concerns include another round of bank account closures, not because customers are engaging in illegal activity, but because compliance officers and managers lack an understanding of the technology underlying cryptocurrencies as the easy way out rather than invest the time and effort to learn more about the space.

           Although owners of blockchain based investments most commonly hold cryptocurrency, blockchain technology is expanding into non-currency areas. In both, however, there are risks mainly because 1) estate planners and family members are ill-informed about the presence and nature of blockchain assets,  2) clients fail to realize that wills and trusts must have specific language to allow Personal Representatives and Trustees to manage those assets after incapacity or death, and 3) the regulatory environment, taxation, reporting, application if intestacy laws and other issues have yet to be resolved.

Traditional planning entities also have a hard time owning cryptocurrency, especially if there is a fiduciary duty owed to beneficiaries to prudently invest assets.  Without specific language, a trust or other entity will not be able to hold cryptocurrency, but if that language is written too broadly, the fiduciary may be exempt from damages due to willful neglect. Also, cryptocurrency is treated as property rather than as currency by tax authorities for tax purposes meaning that the fair market value is set by conversion into the taxing authority’s currently, that is U.S. dollars for the IRS, at “a reasonable exchange rate” and transactions involving cryptocurrency are subject to the capital gains tax regulations. This can result in the cryptocurrency being taxed at one value in one country and another value in another country. 

On top of all this, care needs to be taken to preserve the benefits of cryptocurrency. Cryptocurrency is highly secure, but that security is in jeopardy if the private key or seed phrase is carelessly recorded. With the right private key or seed phrase, anyone can access the cryptocurrency, so planning and procedures have to include how to secure this information. Like cash, cryptocurrency is not traceable. There is no electronic or paper trail linking the parties together in a transaction involving cryptocurrency. To preserve that privacy, you will need to plan that other documentation in the transaction does not reveal these identities, or at least that information is privileged. Shorter transfer delay and lower costs. Unlike hard currency, transferring cryptocurrency takes only moments and there are few, if any, transfer costs. 

So, what to do? First, educate your estate planner and family about any blockchain based assets, especially cryptocurrency, you own. If the value of those assets exceeds $10,000, and the assets are in custody with a fiduciary or institution that is “offshore” Make sure that you are also reporting that investment annually and that the custodian that holds the assets has the capacity to invest the time and effort required to comply with the myriad changes as they occur.

As a fourth generation estate attorney and managing partner of Erskine & Erskine LLC, I provide creative estate and strategic tax planning for business owners,

As a fourth generation estate attorney and managing partner of Erskine & Erskine LLC, I provide creative estate and strategic tax planning for business owners, collectors, and their families.My true passion is customized planning for collections as well as legacy real estate and family businesses. A love for history and the law drive me to achieve the objectives of security, satisfaction, and growth. Counseling families since 1876, our firm has provided me great perspective in this area of law. Utilizing tools like personal trusts, dynasty trusts, private foundations, and family offices is our specialty. Based in the Worcester, Massachusetts area, I am an active member of the American Antiquarian Society, Worcester Economics Club, and the John J. Kittredge Numismatic Foundation. A Lawrence Academy alumnus, I received my B.A. in Medieval History from Carleton College, and J.D. from Suffolk University Law School.

The laws will target "crypto-asset service providers" rather than users themselves. It will be incumbent on transfer platforms to acquire the personal information from the sender and receiver, for instance.

"Cryptocurrency is one of the newest ways to launder money," Mairead McGuinness, the Commissioner for Financial Services, Financial Stability and Capital Markets Union, tweeted on Tuesday. "Our rules will now apply to the whole of the crypto sector. We will ban anonymous crypto wallets and make sure that crypto-asset transfers are traceable."

Over $2 billion-worth of cryptocurrency was criminally laundered in 2020, according to research firm Chainalysis, with 55% of that money being funnelled through 270 blockchain accounts. The EU's new laws, if taken up globally, would make such activity much harder. The US Treasury's Financial Crimes Enforcement Network last year called for similar traceability to be enforced in the US, citing illicit, crypto-based activity from the likes of Lazarus Group.

"Given that virtual assets transfers are subject to similar money-laundering and terrorist-financing risks as wire funds transfers," the EU Commission wrote, "it therefore appears logical to use the same legislative instrument to address these common issues."

Cryptocurrency proponents often claim anonymity as one of the system's great assets, reasoning that privacy is a key part of the decentralised finance that cryptocurrency can offer. However, Bitcoin may be more traceable than previously thought. The FBI in June said it was able to trace and recover 75 Bitcoin, then worth $2.3 million, that Colonial Pipeline paid hackers in the May ransomware attack that corrupted the company's computer systems and pushed up the price of gas. 

Bitcoin hit a high of over $62,000 in April but started dropping precipitously in the middle of May. The price dropped under $30,000 last month when China re-committed to banning cryptocurrency harvesting, which involves power computers solving complex algorithms to "mine" coins like Bitcoin and Ether. The price of Bitcoin flitted between $32,000 and $35,000 in July, but after dipping slightly last week dropped below $30,000 again as the EU announced its planned legislation. 

The entire market has been in the dumps, not just Bitcoin. Dogecoin, the memecoin that could, sits at 17c, far below its May high of 72 cents. After nipping above $4,000 in May, Ether is currently sitting at $1776. 

CareerBuilder CEO Irina Novoselsky suggests people are finding a 'side hustle' in cryptocurrency trading, which is keeping them from returning to work.

Security researchers have identified over 170 Android apps scamming cryptocurrency miners.

The apps have been designed solely to steal money from people who mine cryptocurrencies, said security researchers at Lookout Threat Lab, a cloud security company. 

The apps scammed more than 93,000 people and stole at least $350,000 between users paying for apps and buying additional fake upgrades and services, the researchers said, who classified apps into two families that they dubbed "BitScam" and "CloudScam."

Security researchers have identified over 170 Android apps scamming cryptocurrency miners. (iStock)

"What enabled [these apps] to fly under the radar is that they don’t do anything actually malicious. In fact, they hardly do anything at all. They are simply shells to collect money for services that don’t exist," the researchers said in a report.

And the evolution of crypto mining makes scamming easier.

Cryptocurrency mining taps computer processing power to solve complex mathematical problems that verify cryptocurrency transactions. Miners are then typically rewarded with a small amount of cryptocurrency.

BITCOIN MINING OPERATION IN FINGER LAKES SPARKS LOCAL CONCERNS

Broadly, there are two mining strategies. One is mining pools, where individuals can contribute computing power in order to get cryptocurrency. Cloud mining is the evolution of mining pools. In this case, cloud miners rent cloud computing power – similar to cloud computing.

"Cloud mining introduces both convenience and cybersecurity risks. Because of the simplicity and agility of cloud computing, it is quick and easy to set up a realistic-looking crypto mining service that is really a scam," the researchers said.

The majority of fraudulent apps were paid, allowing the scammers to pocket the money from app sales. The apps also offered subscriptions and services that users could pay for via the Google Play in-app billing system.

After logging in, a user would see an activity dashboard that displays the available hash mining rate – the amount of computing power being contributed to the network through mining – as well as how many coins they have "earned." The hash rate would typically be very low in order to get users to buy upgrades that promise faster mining rates.

"After analyzing the code and network traffic, we discovered the apps display a fictitious coin balance and not the number of coins mined. The value displayed is simply a counter slowly incremented in the app," the researchers said.

In the BitScam-style scam, users are given the option to buy "virtual hardware" to increase the rate of mining. The cost of virtual hardware ranges from $12.99 - $259.99 and can be purchased either through Google Play or via Bitcoin and/or Ethereum.

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Apps were also designed so that users were not "allowed" to withdraw any coins until they reached a minimum balance. And even when a minimum balance was reached, users were not able to withdraw coins, the researchers said.

"The app would display a message telling the user that the withdrawal transaction is pending, but behind the scenes, it simply resets the user’s coin balance amount to zero without transferring any money to the user."

While the apps have now been removed from Google Play, there are dozens more still being circulated in third-party app stores, the researchers said.

"The scammers running this scheme were able to tap into the existing frenzy created by the hot cryptocurrency market," according to the report.

A U.S. congressman has called for a law that allows the government to identify cryptocurrency users and reverse crypto transactions. “There’s a significant sentiment, increasing sentiment, in Congress that if you’re participating in an anonymous crypto transaction that you’re a de-facto participant in a criminal conspiracy,” he said.

Democratic Rep. Bill Foster of Illinois, who is also co-chair of the Congressional Blockchain Caucus, talked about cryptocurrency regulation during an Axios virtual event Tuesday. Addressing the problem of ransomware attacks and how criminals are asking for bitcoin and not cash, the congressman stressed that “there is a fundamental difference between crypto assets and real-world assets. That’s an important distinction that we must make ultimately in the law.”

Emphasizing that laws must be passed to allow federal courts to identify crypto users and reverse transactions in bitcoin or other cryptocurrencies, he said:

You have to be able to go to a court to unmask participants under some circumstances.

He discussed “The condition under which we can reclaim” cryptocurrencies, such as ransoms paid to criminals, noting that it is one of the fundamental decisions which has to be made about crypto assets.

The congressman pointed out that the law needs to address whether cryptocurrency is “truly anonymous or is there a court you can go to, to unmask the participants.” In addition, “is there a court, a third-party, that you can go to, to reverse fraudulent or mistaken transactions.”

Foster gave an example. “If someone dragged you into an alley and put a gun to your head and say get out your cell phone and transfer all your bitcoin to my wallet. Are you just out of luck or can you go to court, have them unmask the participant.” Furthermore, “can the court — if they decide that the transaction was fraudulent, criminal, or mistaken … use its access to very heavily guarded key, cryptographic back door, in a sense, that allows them to cryptographically reverse transactions on a blockchain.”

The lawmaker claims that such tools are necessary for the government to protect itself, the people and companies from ransomware attacks, like the one suffered by Colonial Pipeline.

Rep. Foster opined:

I’ve just said about three things there that will drive the crypto purists berserk, like the trusted third party and so on.

He believes that “For most people, if they are going to have a big part of their net worth tied up in crypto assets, they are going to want to have that security blanket of a trusted third-party that can solve the problem when they get hacked, when they get stolen or even just a mistaken assumption.”

Foster further said that cryptocurrencies must become compliant with federal regulations and laws for them to ever become mainstream instruments for conducting transactions. Replying to a question about how the U.S. would regulate cryptocurrencies given their global and borderless nature, he affirmed, “We’re going to have to establish a law between the legal and illegal regimes here,” elaborating:

There’s a significant sentiment, increasing sentiment, in Congress that if you’re participating in an anonymous crypto transaction that you’re a de-facto participant in a criminal conspiracy.

Many people took to social media to ridicule the congressman and his attempt to reverse bitcoin transactions, stating that he does not understand how bitcoin works. Some responded to Foster’s criminal allegation, stating that they are “not de-facto criminals.”

What do you think about Rep. Foster calling for legislation to give the government power to reverse cryptocurrency transactions? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Bitcoin prices have crashed from levels of around $62,000 in mid-April to just about $33,000 as of Tuesday. The sell-off has been driven by multiple factors including China’s crackdown on Bitcoin trading and mining and Tesla’s surprise reversal of its decision on accepting the digital currency as payment for its cars. There have been concerns over the security of the cryptocurrency after U.S. officials were able to recover most of the Bitcoin ransom paid to hackers that targeted the Colonial Pipeline. Moreover, with inflation and bond yields expected to trend higher, money is moving back to real-economy sectors and away from non-productive assets such as cryptocurrency.

Now, although the market sentiment for cryptos, in general, is bearish, cryptocurrencies appear to be here to stay as an asset class. While the asset itself is volatile and prone to boom and bust cycles (we are likely in the fourth asset price cycle since 2009), our indicative theme on Cryptocurrency Stocks could be a safer way to play the long-term upside from cryptocurrencies, without taking a position in the currencies themselves. The theme, which includes semiconductor, payments, and brokerage companies that have exposure to the cryptocurrency value chain, has gained about 9% year-to-date, compared to the S&P 500 which remains up by about 12% over the same period. The theme remains up by about 130% since the end of 2019, versus 30% for the S&P 500. Within our theme, graphics processor major Nvidia NVDA has fared the best, with its stock rising by 30% year-to-date. On the other hand, Advanced Micro Devices AMD has been the worst performer, with its stock down by about 12%.

[4/5/2021] Crypto Stocks To Watch

Cryptocurrency prices have surged this year. Crypto bellwether Bitcoin has almost doubled year-to-date to levels of about $60k as of the end of last week, as more institutional investors warm up to the currency, with companies such as Tesla also indicating that they will accept bitcoin payments from customers. However, investing in Bitcoin and other cryptos is risky at current levels. With Covid-19 cases on the decline and vaccination rates in the U.S. rising, the economic outlook is improving. Bond yields are also trending higher, with the yield on the 10-year Treasury note rising from around 1% earlier this year to close to 1.70% currently. Considering this, investors are moving funds back to real-economy sectors, and it’s likely that non-productive assets such as Bitcoin will eventually be impacted. Our indicative theme on Cryptocurrency Stocks could be a safer way to play the long-term upside from cryptocurrencies, without taking a position in individual currencies. The theme, which includes semiconductor, payments, and brokerage companies that have exposure to the cryptocurrency value chain, is up by about 122% since 12/31/2019, compared to the S&P 500 which is up by about 24%. Here is a look at the recent developments for some of the stocks in our theme.

PayPal, a large online payments processor, allows customers to buy, hold, and sell cryptocurrencies. The company has taken this a step further, launching its “Checkout with Crypto” service last week, enabling U.S. customers to use their crypto holdings to pay at millions of online merchants worldwide.

Nvidia indicated a few weeks ago, that it would be launching a GPU that was dedicated to mining cryptocurrencies. Nvidia has seen gaming GPU shortages in the past, as its gaming processors were being used to mine cryptocurrency. The move should let the company better target the crypto mining space, while potentially alleviating GPU shortages for gaming.

CME Group CME , a derivatives exchange, plans to launch new Micro Bitcoin futures from early May, subject to regulatory approval. The smaller-sized futures contracts are a tenth of the size of one Bitcoin and will be targeted at institutions and sophisticated traders.

[3/16/2021] Crypto Stocks To Watch As Bitcoin Nears $55k

Cryptocurrency prices have surged this year, with Bitcoin now up by around 90% since early January, trading at levels of around $55k currently. However, Bitcoin looks quite risky at current levels due to a couple of factors. With Covid-19 cases on the decline, the economic outlook is improving and bond yields are also on the rise. Considering this, investors are likely to start moving funds back to real-economy sectors, and non-productive assets such as Bitcoin, which rallied big through the pandemic, could be impacted. Our indicative theme on Cryptocurrency Stocks could be a safer way to play the long-term upside from cryptocurrencies, without taking a position in individual currencies. The theme, which includes semiconductor, payments, and brokerage companies that have exposure to the cryptocurrency value chain, is up by about 124% since 12/31/2019, compared to the S&P 500 which is up by about 22%. Year-to-date, the theme is up by 4%, compared to the S&P 500 which is up around 5%. Within our theme, digital payments player Square SQ has been the strongest performer, rising by 287% since the end of 2019, while exchange major CME Group has been the worst performer in our theme, rising by just about 4% over the same period.

[2/18/2021] Which Stocks Should You Buy As Bitcoin Hits $50k?

Cryptocurrency have continued their surge this year, driven by retail and institutional interest. While the crypto market bellwether Bitcoin has soared 5x over the last 12 months and by almost 80% year-to-date, lesser-known crypto Dogecoin is up by over 10x year-to-date. To be sure, these currencies remain a risky investment, given their relative lack of utility and extremely high volatility. Our indicative theme on Cryptocurrency Stocks – which includes semiconductor, payments, and brokerage companies that have exposure to the cryptocurrency value chain - could be a safer way to play the crypto space, without taking a position in individual currencies. The theme has returned about 151% since the end of 2019, compared to about 22% for the S&P 500. The theme is also up 14% year-to-date, versus about 5% for the S&P 500. Payments player Square remains the strongest performer in our theme, rising by over 330% since the end of 2019, driven by its Bitcoin exposure, and also by an increasing preference for digital payments among consumers and businesses. On the other side, financial exchange major CME Group has been the worst performer in our theme, down by about -5% over the same period.

[Updated 1/20/2021] Cryptocurrency Stocks

Bitcoin prices have surged by more than 50% over the last month and remain up by about 4x over the 12 months, due to higher retail and institutional interest. That being said, Bitcoin remains a risky investment, given its relative lack of utility and extremely high volatility. Our indicative theme on Cryptocurrency Stocks – which includes semiconductor, payments, and brokerage companies that have some exposure to the cryptocurrency value chain - could be a safer way to play the crypto space, without betting on individual currencies. The theme has done well, rallying by over 100% over the last year. Below is a bit more about the key companies in the theme and how they have been faring.

Nvidia stock saw big gains over 2020, driven by growing demand for its GPUs from gaming consoles and data centers and its planned acquisition of CPU designer ARM. The company recently indicated that it could restart the production of dedicated crypto mining GPUs, which essentially remove the video outputs that are required for gaming.

Square a payments company, allows users to buy and sell bitcoin via its Cash mobile payment application. The company said that bitcoin-related Revenue surged by about 8x over the first nine months of 2020 to around $2.8 billion.

PayPal a large online payments processor has also reported increasing engagement on its PayPay mobile app after it introduced support for bitcoin last October, with about half its crypto users opening the PayPal app daily.

CME Group the world’s largest financial derivatives exchange, also offers bitcoin futures contracts. The exchange has emerged as the world’s largest futures exchange for Bitcoin, with open interest - contracts traded but not squared off - for the cryptocurrency standing at $2.1 billion.

[Updated 12/7/2020] How Nvidia, Square & PayPal Stocks Are Benefiting From Soaring Bitcoin Prices

Bitcoin prices have surged by over 160% year-to-date, driven by multiple factors including higher institutional interest, fintech companies Paypal PYPL and Square’s moves into the crypto space, and also by a view that scarce digital currency could be a hedge against inflation and a weakening U.S. dollar. Our indicative theme on Cryptocurrency Stocks – which includes semiconductor, payments, and brokerage companies that have some exposure to the cryptocurrency space – is up a solid 110% year-to-date, compared to the S&P 500 which is up by just about 14% over the same period. Key stocks in our theme include Square, PayPal Holdings, Nvidia, and CME Group.

Although crypto likely represents a small portion of these company’s revenues at the moment, it does have the potential to be big. For example, Payment apps Square and PayPal, who make money by buying bitcoin from brokers and selling them to their customers by adding a “spread” stand to benefit as prices and volumes rise. Square’s Cash App generated about $1.63 billion in Bitcoin-related sales in Q3 2020, an 11x jump year-over-year. Similarly, Nvidia also benefits from demand for its top-of-the-line GPUs such as the Ampere lineup from cryptocurrency miners.

[Updated 10/29/2020] Cryptocurrency Stocks To Watch

Interest in cryptocurrency is surging once again with Bitcoin prices up by almost 30% over the last month, driven by growing institutional interest and Paypal’s recent move to allow its customers to buy and sell certain cryptocurrencies. Our indicative theme on Cryptocurrency Stocks – which includes semiconductor, payments, and brokerage companies that have some exposure to the cryptocurrency space – is up 88% year-to-date, compared to the S&P 500 which is up by just about 5% over the same period. This theme could be of interest to investors who are looking for upside from cryptocurrency adoption and prices, but want to avoid buying into the currencies themselves considering the volatility, risk of fraud, or cyber theft, or potential portfolio mandates. Below is a bit more about the stocks in our theme and how they have fared this year.

Square cash mobile wallet app has emerged as a very popular way for people to buy and sell Bitcoin. The stock has gained a whopping 183% year-to-date, as investors bet that Square’s digital payment solutions will continue to gain traction through and post Covid-19. The stock has dropped by about -9% over the last 5 trading days, however.

Nvidia a semiconductor company that is best known for its graphic processing units which are increasingly used in machine learning and AI, is also finding application in bitcoin mining. The stock has gained over 131% year to date although it declined by about -3% over the last week.

PayPal a large online payments processor, has indicated that it would allow customers to buy, hold, and sell cryptocurrencies such as Bitcoin and Ethereum directly within its PayPal and Venmo app. The stock is up by 88% this year and was down by about -1% over the last 5 trading days.

Advanced Micro Devices is a semiconductor major that makes CPUs and GPUs, which are increasingly used in bitcoin mining. The stock has gained about 79% year-to-date and remained largely flat over the last 5 trading days.

CME Group the world’s largest financial derivatives exchange, also offers bitcoin futures contracts. The stock is down by about -18% year-to-date and declined by about -2% over the last week.

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Led by MIT engineers and Wall Street analysts, Trefis (through its dashboards platform dashboards.trefis.com) helps you understand how a company's products, that you

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British detectives on Tuesday seized a record nearly $250 million (180 million British pounds) in bitcoin linked to money laundering.

“Today’s seizure is another significant landmark in this investigation which will continue for months to come as we hone in on those at the center of the suspected money laundering operation,” said Detective Constable Joe Ryan.

The cryptocurrency was discovered Saturday after the economic crime command for the Metropolitan Police, which oversees Greater London, received intelligence relating to the criminal transfer, according to reports. In June, the police confiscated $158 million (114 million British pounds) worth of cryptocurrency and arrested a 39-year-old woman in connection to the case. The woman was interviewed in relation to the latest seizure.

“While cash remains king in the criminal world, as digital platforms develop we are increasingly seeing organized criminals using cryptocurrency to launder their dirty money,” said Graham McNulty, the police's deputy assistant commissioner.

“While some years ago this was fairly uncharted territory, we now have highly trained officers, and specialist units working hard in this space to remain one step ahead of those using it for illicit gain,” McNulty added.

Cryptocurrencies have frequently been used in money laundering schemes despite blockchain acting as a preventive tool.

“Cryptocurrencies have the reputation for being cross-border and anonymous, and therefore attractive to bad actors across the world,” Kim Grauer, senior economist for Chainalysis, told Quartz in December 2019. “But because transactions involving cryptocurrencies like bitcoin are recorded on a permanent, public, and immutable ledger, cryptocurrencies can actually offer unprecedented transparency into financial transactions.”

In what appears to be a first for the American government, the U.S. Department of State is offering to pay a cryptocurrency bounty worth up to $10m (315BTC at the time of writing) in return for actionable intelligence about cyberattacks orchestrated by foreign governments.

The federal agency, acting through the Rewards for Justice program operated by the Diplomatic Security Service, made the offer in a July 15th press statement.

It said the payment would be provided to anyone who can give “information leading to the identification or location of any person who, while acting at the direction or under the control of a foreign government, participates in malicious cyber activities against U.S. critical infrastructure”.

The press statement then added: “Reward payments may include payments in cryptocurrency.”

An agency spokesperson confirmed to a taken-aback Coindesk that this does, indeed, mark “the first time since its establishment in 1984 that the Rewards for Justice program has offered a reward payment in cryptocurrency”.

More significantly, it appears to be the first time that any organ of the U.S. federal government has taken the plunge. Most-wanted lists with cash rewards are also maintained by the Federal Bureau of Investigation (FBI) and the U.S. Immigration and Customs Enforcement (ICE) agency, but to date neither body has publicly offered to make payments in cryptocurrency (including when the fugitive is wanted in connection with crimes related to cryptocurrency).

For bitcoin enthusiasts, the news may be seen as an admission by the U.S. government that decentralized cryptocurrencies are a viable means of conducting state business.

That’s probably reading too much into it. In order to be eligible for the $10m reward, you would almost certainly need to be a Russian or Chinese hacker who is willing to commit treason by passing intelligence about your activities and chain of command to a hostile Western government.

The U.S. Diplomatic Security Service will be acutely aware that anyone engaging with its Rewards for Justice program is putting their life at risk, so the decision to offer payments in cryptocurrency appears to be largely pragmatic. Most cryptocurrencies are transacted over public blockchain networks that offer more anonymity and less traceability than traditional payment channels.

Informants have also been asked to initiate contact via an anonymized Tor channel on the Dark Web–not exactly routine government protocol.

Nonetheless, it is of historical significance that the U.S. federal government is now offering to pay for services–funded by taxpayer dollars–with cryptocurrencies that exist outside the influence of central banks and other state institutions.

That should lay to rest any lingering doubts some people have about the security of bitcoin, which is cryptographically unbreakable and can only be seized when stored improperly by entrusting it to third parties.

If adopted as broader government policy, the approach should also result in a healthy up-tick in intelligence tip-offs.

Earlier this month, a coordinated ransomware attack originating in Russia disrupted the operations of more than 1,000 companies using IT infrastructure provided by U.S. firm Kaseya. Cybercrime costs the global economy more than $1tr per year–about 1% of global GDP–according to software security firm McAfee.

I am an aviation journalist turned crypto reporter whose work has appeared in The Guardian, The Economist, The New York Times, Flightglobal, African Business, Al Arabiya

I am an aviation journalist turned crypto reporter whose work has appeared in The Guardian, The Economist, The New York Times, Flightglobal, African Business, Al Arabiya & New Eastern Europe. I first became interested in bitcoin in 2013, but only changed career in 2021 after realizing the network's true potential to democratize finance–particularly in the developing world. My work exposes and debunks the endemic misinformation spread about bitcoin by mainstream media outlets, multinational organizations and legacy financial institutions. I also cover technical analysis and corporate adoption of blockchain technology. I believe bitcoin is humanity's best weapon in the fight against inequality. (Financial disclosure: I currently have bitcoin & Ampleforth holdings.)

A survey by Nickel Digital Asset Management shows that 82% of institutional investors and wealth managers are planning to increase their cryptocurrency exposure between now and 2023.

Many of those professional investors with holdings in crypto assets are looking to increase their exposure … These trends will continue to expand.

What do you think about 82% of surveyed institutional investors planning to increase their crypto exposure? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

The decision was made based on "changing market conditions."

The outperformance came despite a negative month for the leading cryptocurrency by market cap.

Tron, which is currently the leading blockchain for Tether’s USDT, is USDC’s fifth network.

The financial surveillance agency is pointing a finger at crypto in its new plan to combat terrorism financing.

The approval to trade the leading cryptocurrency was given by CIO Dawn Fitzpatrick, according to the report.

Swarm Markets, which claims to be the world’s first regulated DeFi protocol, says 250 customers have ponied up funds.

Troubling comments and a U.S. congressional hearing on crypto points to policymakers’ increasing intention to regulate the crypto market.

Crypto crackdowns tend to intensify amid politically sensitive times in China.

Y Combinator's basic income idea sounds creepy as hell.

“Despite there being a sign in the recent bear market that investors are scared off, we don’t see massive outflow from institutional users,” one crypto exchange executive said.

The majority of the reduction stemmed from China's move to shut down cryptocurrency mining operations in the country, with a little bit from Iran.

Uncertainty following the Board of Elections' removal of 135,000 ballots has sunk Eric Adams' chances on PredictIt and Polymarket.

“Some [extreme right-wing] groups have used so called ‘privacy coins,’” the FATF report states.

Backers of Syndicate’s community raise include Balaji Srinivasan, Jeremy Allaire, Meltem Demirors and dozens more.

Gary Lachance, an early dogecoin backer and founder of the Decentralized Dance Party, is giving away 1 million doge to seed his latest venture.

The national stock exchange of the Philippines, the PSE, says cryptocurrency is “an asset class that we cannot ignore anymore.” The stock exchange further says cryptocurrency trading “should be done at the PSE,” given its infrastructure and investor protection safeguards.

If there should be any exchange for cryptos, it should be done at the PSE. Why? Number one, it’s because we have the trading infrastructure. But more important, we’ll be able to have investor protection safeguards especially with a product like crypto.

We’re waiting for the rules from the Securities and Exchange Commission (SEC) on how crypto or digital asset trading will be governed.

Do you think the Philippine Stock Exchange should offer cryptocurrency trading? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.