Commentary on the economic , geopolitical and simply fascinating things going on. Served occasionally with a side of snark.
Wednesday, March 19, 2014
Bitcoin and cryptocurrencies news March 19 -21 , 2014 -- Breaking: CoinEx.pw hacked, all coins stolen ....... Sean’s Outpost & Satoshi Forest Under Attack ....... Breaking: Blockchain Outage And Cause Of The Issue ...... BREAKING: As Promised, Bitcurex Resumes Operations on Tuesday ....... Bank of Thailand issues another statement on Bitcoin , Cyprus and Denmark issue warnings !
Updated 15:00 GMT:Updated with commentary from co-founder of BitAngelsClub Eric Gu.
A false report published on a financial news feed run by Chinese microblogging site Sina Weibo was responsible for the sharp decline in bitcoin prices across China’s biggest exchanges today (21st March).
At 10:22 am GMT, Sina’s financial live feed issued a now-retracted news reportindicating that China’s central bank, the People’s Bank of China (PBOC), would move to halt all bitcoin transactions in the country effective 15th April.
“Regarding the PBOC statement issued on 3/18 requesting all bitcoin transactions to be halted before 4/15, those close to the regulatory body told Sina Finance on Friday, the PBOC did issue a document, but it was not to ban/halt bitcoin transactions, instead to strengthen regulatory oversight of bitcoin transactions, circulation and redemptions.”
The PBOC later took to the Weibo platform and Twitter to clarify the news.
“The report by certain media that ‘PBOC has issued a document as of 3/18, requesting all bitcoin transactions be halted by 4/15′ is in error. The attitude of the PBOC towards bitcoin has been clearly stated by the [5th December] document issued by the PBOC and five other agencies.”
The company acknowledged the damage its report caused, noting that it “quickly caused panic in the bitcoin community”, and that “bitcoin’s domestic prices [were] likely to fall significantly” as a result of its error.
CoinDesk’s Bitcoin Price Index indicates that the price of bitcoin was down 2%, or roughly $12 on the news, though prices were impacted more severely on China-based bitcoin exchanges.
Sina indicated that its report caused the price of bitcoin to fall 5%, dropping from 3,691 yuan ($592.99) to 3,400 yuan ($546.24), though a closer look at bitcoin price data across the major China-based exchanges shows the damage was far worse for certain investors.
Data from Bitcoincharts suggests the price of bitcoin on BTC China hit a low of 3,301 yuan at 11:00am GMT, dropping from 3,568 in just 30 minutes.
BitcoinWisdom shows that China-based exchange OKCoin experienced a more aggressive fall in price, crashing from around 3,600 yuan to 3,100 and below from 10:30am GMT to 11:00am GMT.
BitcoinWisdom’s Huobi data shows a similar decline on this exchange, from roughly 3,600 yuan to a low of approximately 3,200 yuan within the same time window.
Community members reactions ranged from begrudgingly bemused to irate, with some reddit users falling into the former camp given the fact that China’s stance on digital currencies has seemingly changed frequently over the last few months.
Others suggested that the digital currency’s susceptibility to such negative news is a weakness that will hinder adoption.
Others suggested that the digital currency’s susceptibility to such negative news is a weakness that will hinder adoption.
Reaction in China’s bitcoin business community leaned more toward outrage at the news organization’s seemingly negligent reporting.
VC investor and CoinDesk contributor Rui Ma took to Twitter to clarify the news, and voice her frustrations about the actions of the social media giant.
Eric Gu, co-founder of BitAnglesClub, an international incubator focused on digital currencies, chose to view the events with a hint of optimism. Though, he acknowledged that they are evidence of the fragile state of China’s market.
“The fact that [the] Chinese central bank swiftly came out off working hour to dismiss the rumor indicated that [it] has no plan to shutdown bitcoin exchanges any time soon.”
At press time, the price the price of bitcoin on BTC China had recovered to a low of 3,519 ($565.36 at press time), though this was down from an opening low of 3,654 yuan, suggesting that the damage from the report was still impacting the market.
Bankrupt Japan-based bitcoin exchange Mt. Gox released a new press statement earlier today (21st March) confirming 20th March reports that it had uncovered an ‘old-format’ bitcoin wallet containing some 200,000 bitcoins ($115.8m at press time) presumed lost in the run-up to its insolvency.
The statement indicated that the company discovered the funds on 7th March and promptly informed the necessary authorities of the recovery.
However, Chris Dore, a partner at Edelson law firm, isn’t exactly buying Mt. Gox’s version of the events.
Dore, whose firm represents the US class action against the insolvent exchange, suggested that the announcement is closely tied to matters it is currently investigating.
Dore summed up his opinion on the news, telling CoinDesk:
“Their statement that they found [these bitcoins] in a random wallet and failed to tell anyone for two weeks is highly suspect.”
Instead, Dore indicated he believes that the funds may be connected to his firm’s ongoing investigation of 180,000 bitcoins that were said to have been moving through the blockchain on or around 7th March.
“We believe we were on the right trail. It appeared that these 180,000, 200,000 bitcoins were being tumbled, that they were being broken down and reconstituted, so our goal was to find this out.”
Dore suggested that the announcement may have been a move by Mt. Gox to make it harder for information to be uncovered about the funds.
Added Dore: “If it’s a coincidence, it’s a $120m coincidence. We frankly just don’t buy it.”
Investigating the funds
In an interview, Dore elaborated on court proceedings held yesterday, noting that during the day’s events his legal team had asked for restrictions on Mt. Gox’s assets to be relaxed, a request the judge approved. Dore said that his team asked for certain third parties to be able to move the funds.
“We’re not fully disclosing what we know or why we were asking that, but essentially it was an effort to try and trace bitcoins that were being moved around and that we believe were associated with this initial group of 180,000 [bitcoins].”
The correlation between the events, Dore suggested, raises questions about Mt. Gox and its conduct.
“The idea that they found it in a wallet and they were breaking it down into hundreds of thousands of smaller wallets, it raises a lot of questions about their honesty and whether they’re being forthright about what they have.”
Dore was not able to fully elaborate on his suspicions regarding the movement of the funds.
Said Dore: “Our hope was, if they could continue to move, we could track where they would end up.”
What the finding means
Dore also addressed another lingering question, just what exactly does the discovery of the funds mean for former exchange users given that these parties are not creditors.
However, that may be up for dispute. Dore indicated that his firm could still make the case that his clients should be treated with this legal distinction.
“In our view, any assets are impactful on our settlement, because the assets, the fiat currency, the bitcoins of our class members. we will do everything in our power to get those returns.”
The next scheduled hearing is expected to take place on 1st April. Then, Mt. Gox will attempt to shield its US assets until the conclusion of its bankruptcy proceedings in Japan.
The Superintendencia Financiera de Colombia (SFC) may be close to outlawing bitcoin transactions in the South American country, a report from a major nationally distributed newspaper claims.
El Tiempo reported on 20th Marchthat the SFC, in conjunction with Banco central de Colombia, Colombia’s central bank, and the Ministerio de Hacienda y Crédito Público, the executive body responsible for budgetary concerns, is preparing to issue a document outlining the government’s stance on bitcoin and bitcoin-related activities.
According to El Tiempo, the SFC is set release the circular outlining the ban as soon as Tuesday of next week
The Colombian government is expected to cite a lack of effective market protections as one of the core reasons for the measures when it publishes the document, the report suggests. Additionally, the media outlet alleges that bitcoin is viewed by the Colombian government as a threat to the country’s financial system.
However, there remains disagreement among South American bitcoin community members as to whether the restrictions will go as far as the report suggests, with some optimistic that the measure will simply amount to a stern warning.
Government opposition to digital currencies
An informal translation of the report indicates that senior Colombian officials such as Finance Minister Mauricio Cardenas have been working in recent weeks and months on an overarching policy for bitcoin. Research from the US Law Library of Congress, corroborated by BitLegal, indicates this would be the first time the country has spoken publicly about digital currencies.
El Tiempo quoted Cardenas during a recent speech before the country’s national legislature in which he touted the strengths of the Colombian peso compared to digital currencies.
“Our currency is reliable, safe and generates no risk, while other forms of money [like Bitcoin] do not have the same level of support and guarantees,” he remarked.
A source connected to the Colombian Ministry of Finance told El Tiempo that the ban may very well focus on Bitcoin handling activities rather than outright purchase by consumers.
“With bitcoin no illegal recruitment, because ultimately what you are doing is buying a product. But when others are offered to collect money from others to invest in that currency, there is already an illegal recruitment, and this brings many risks.”
Colombia’s central bank has also reportedly weighed against bitcoin, saying that it is not a real currency and therefore receives no institutional backing.
The Colombian Ministry of Finance nor the Superintendency of Finance have responded to press inquiries.
Sebastian Serrano, CEO of Latin American-focused payment gateway BitPagos, suggested that the initial reports may not be as ominous as they sound.
Speaking to CoinDesk, he said:
“What we know so far is that the government is going to issue a warning similar to the one issued by the Central Bank of China. Most likely not making bitcoin illegal but just restricting financial institutions from trading Bitcoin in attempt to stop speculation over the currency and avoid the effects of a crash.”
Serrano added that while the news certainly isn’t encouraging for the local Colombian ecosystem, the extent of any damage won’t be known until the report is released on Tuesday.
Ulf Kuhn, founder of Chile-based telemarketing business Telemarketing Facil, indicated that he was unsure of what exactly to make of the report.
“First they say bitcoin and EVERY transaction is illegal. Then they say that offering investing services for bitcoins is illegal. Then they say they worked together with banks, but it’s just a financial department statement.”
Carlos Mesa, of local bitcoin advocacy group Bitcoin Colombia, took to reddit to discuss the news, suggesting more details would be forthcoming after he had an internal meeting with the SFC.
More central banks weigh in worldwide
While the Colombian government has not released its official document outlining the details of a ban, such a move would add to a growing chorus of governments and central banks worldwide that have moved against the Bitcoin.
Earlier this month, the Bank of Mexico banned domestic banks from handling bitcoin. The Mexican central bank cited its risks to the general public but did not directly outlaw consumer purchases of the cryptocurrency.
Other central banks, including those from Russia, Hungary, Cyprus and the Philippines, have issued warnings about bitcoin but have not moved to ban it, despite sometimes harsh rhetoric.
If as extensive as the report suggests, Colombia’s policies would be among the most restrictive enacted worldwide.
Notoriously tight-lipped bitcoin exchange and CoinDesk Bitcoin Price Index member BTC-e is now allowing customers to withdraw funds to Visa and MasterCard debit and credit cards, with some exceptions.
The company blog post, issued on 21st March, indicated that the new program is now available to customers in any country, using any currency. All customers will pay a 5% fee for the service.
The new functionality is noteworthy as it will allow customers to send money to debit and credit cards issued by two of the largest and most commonly used international card issuers. At present, the transfer of funds is only possible in US dollars.
“If your card is not in USD, the money will be converted at the rate of VISA / MasterCard or your bank’s rate (depending on the agreement with your bank).”
BTC-e estimated that customers will need to wait between two and four days to receive funds. MasterCard’s Maestro debit card, cards issued by PayPal andVisa Electron debit cards are not able to be used in conjunction with the service.
BTC-e did not respond to requests for further information.
BTC-e conducted customer testing for an unidentified period before enabling the service, and posted answers to three frequently asked questions.
The exchange indicated the transactions will display as “affiliate payment” or “refund affiliate payment” on credit card statements. It added that funds can be sent to cards in any country and that on some cards such transactions would not be possible due to restrictions imposed by banks.
“Some credit cards that do not allow [you] to have a positive balance cannot be funded. If payout to your card is not possible, then we will immediately notify you and refund the money back to your account.”
The news follows what appears to be an increasingly active period of experimentation from the major exchange in regards to its offerings, notably following the insolvency of its one-time major competitor Mt. Gox.
On 28th February, it cut withdrawal fees via some of its third-party services in a move that increased the ease with which some customers would be able to move funds out of the exchange.
By following the chain of transactions from a known BTC withdrawal broadcasted by Mt. Gox’s api, Bitcoiners were able to know beyond a doubt that someone had moved 180,000 BTC of the supposedly lost ~850,000 BTC previously under the control of Mt. Gox. Through more blockchain detective work on known Mt. Gox Bitcoin addresses, Bitcoiners on Reddit came to the conclusion that Mt. Gox has at least 200k BTC.
This transaction came well after Mt. Gox claimed that they had lost ~850,000 BTC of their users funds. It seems that Mt. Gox is taking steps towards “finding” the “lost coins. Recently, Mt. Goxreopened their website to allow users to log in and view their previous fiat and BTC balances.
The most recent release from Mt. Gox via Yahoo! confirmed that the transactions followed by Bitcoiners on the 7th of March were in fact initiated by Mt. Gox. Additionally, Mt. Gox’s lawyer said that the Bitcoins were “found” in a wallet on internet storage.
What exactly that means has yet to be fully explained by Mt. Gox. The speculation on all fronts is exacerbated by unconfirmed chatlogs between hackers and Mark Karpeles. Karpeles could be in control of over 1 million BTC, or none, or just ~200,000. The clear facts are simple though: Mt. Gox has claimed one thing or another consistently over the last few months, and each and every one of those claims has turned out to be a flat out lie.
It’s no wonder that Karpeles’ lawyers have advised him to stay quiet.
As always, stay tuned to CCN for more updates on Bitcoin news
Danish Central Bank Compares Bitcoins to ‘Glass Beads’
Danmarks Nationalbank, the Danish central bank, has issued a stern warning on bitcoin, saying that it is not money in the true sense of the word, as it is not backed by an issuing institution.
Rather than functioning like money, bitcoins display the characteristics of commodities – that is, users attach value to them, not issuers or central banks.
Yet, said the bank, bitcoins do not have intrinsic value like gold and silver, and they bear a closer resemblance to “glass beads” – an apparent reference to the beads that were traded in past centuries for gold, ivory and other commodities.
No value anchor
“Bitcoin is a virtual currency without any value anchor and hence it may rise sharply or fall very suddenly. A core property of money is that its value is stable so that its purchasing power does not change markedly from day to day,” said the bank’s Governor Hugo Frey Jensen. He added:
“In spite of the considerable focus, use of bitcoins as a means of payment remains very limited. Against that background, the risks linked to their use are currently assessed to be limited to the individual user.”
He added that European authorities are analysing the need to regulate such virtual currencies. In December 2013, the European Banking Authority (EBA) issued a warning on the potential risks related to virtual currencies, focusing on fraud and theft.
The bank warns that bitcoin is subject to wild fluctuations and recent events such as cyber attacks launched against bitcoin exchanges illustrate the risks associated with digital currencies. Since bitcoins are not protected by depositor guarantees or consumer protection legislation, investors face high levels of risk.
Reluctant to regulate
Last year, Denmark’s Financial Supervisory Authority (FSA) clearly stated that the use of digital currency in the country is not regulated. The FSA said it would not police digital currencies, as they are not covered by existing regulation.
Most countries in Europe have adopted a similar stance. They do not view digital currencies as money, hence regulators do not think it is within their purview to deal with them.
The FSA also outlined a number of concerns and risks associated with bitcoin and other digital currencies. These ranged from tax implications to the risk of losing money invested in digital currencies through theft or volatility.
Angelos Votsis warns people about the risks of Bitcoin. Bitcoin’s popularity has grown tremendously in Cyprus.
Bitcoin has seen its popularity go up tremendously in the past year. Some argue that this is due to the worldwide financial crisis. This is proven when looking at specific countries that have been hit harder than others by this disaster. Cyprus being a great example of this.
The mediterranean island reached headlines last year after several unusual measures were taken to eliminate the national debt. Cyprus agreed to a bailout deal that was set by the European Union. Countries that need help can ask for the EU for help but, in order to get this, are usually pushed to make drastic changes in their policy. In the case of Cyprus, the country’s second largest bank would be closed, and the country imposed a ‘bank deposit levy’ of 6.7% for all accounts under €100,000. Those over were subject to 9.9%. After this, people lost their faith in banks, turning to cryptocurrencies like Bitcoin in the process.
On Tuesday, the cypriotic government issued a new warning concerning the potential dangers associated with digital currencies. The parliament demanded to put the necessary safeguards in place to protect the public. In a joint statement, the ministries of trade and finance and the Central Bank warned that people could lose their money by investing in digital currencies like Bitcoin.
Once again, Mt. Gox was used as a prime example to scare people away from buying Bitcoins. “There is no specific legal protection in the event of an exchange platform losing money or collapsing,” the statement said. Authorities seem to be waiting for events like this to happen so they can spread unfounded statements. As if the risk of losing money on exchanges wasn’t enough, the statement kept going. It also explained that digital currencies could be stolen by hackers while its value could fluctuate rapidly or even be wiped out. On top of that, there was a high risk of cryptocurrencies being used in criminal activities, including money laundering.
“As a state, we ought to seek the framework of safeguarding all citizens as well as all those who trade in Bitcoin,” Kyriacos Hadjiyiannis of the Democratic Rally Party said. Meanwhile, people must be “extra careful and keep themselves informed before making their choice,” added Angelos Votsis, member of the House of Representatives.
It’s clear Bitcoin is on the rise in Cyprus. When people are hit hard by their government, they will start looking for ways to take back what they lost. In this case, we’re talking about financial freedom. The people of Cyprus have turned to Bitcoin and local merchants, heck even one of the national universities, are giving them a chance to use the cryptocurrency in everyday life. Unfounded government warnings show that authorities fear Bitcoin. Maybe if they wouldn’t have made such a mess of it all in the first place, there would be nothing to be afraid about.
A few days ago, people started complaining in CoinEx’official thread at the Bitcointalk forum. At first, deposits and withdrawals seemed impossible. Shortly after that, basic trading became unavailable, as well. Some time later, the exchange went into maintenance mode, linking to their Twitter accountfor updates. Only one tweet was made, containing ‘security issue, investigating’ as the only explanation.
The community became restless at once, thinking of several reasons as to why CoinEx could have gone into maintenance mode. A hacking attempt seemed to be the major consensus among its users, leaving everyone worried about the coins they have stacked at CoinEx.
Official updates about the matter didn’t come and the community became more worried by the hour. Some claimed Erundook, one of CoinEx’ founders, took off with all the coins himself. Obviously, this was a far-fetched conclusion but that’s what you get when you fail to make a statement whenever something major like this happens. It seems hard to learn from previous examples.
Today, three days after the site went down, Erundook finally released an update concerning the CoinEx situation. It seems the exchange was definitely a victim of a hack. The wallet server was hacked and all coins were withdrawn. Erundook said the following about this all:
“Please stop posting FUD about CoinEx, we will issue an announcement within next 24hrs about how we are going to handle the situation.
Long story short: yes, our wallet server got hacked and all funds were withdrawn.
Please read back to the beginning of this thread, we had such a problem before and *returned all the stolen funds from our own pockets*. Before this hack happened, we also had several attacks that lost funds and we silently covered those from our fees.
For those who was stalking me at internets: that’s true, I was trying to hide/delete my accounts. At the very first moment i saw zero balance at our bitcoin wallet I knew this was coming. And it scared the shit out of me. Hope you can understand that. About me selling bitcoins at localbitcoins.com: that’s true too. I have 33mh/s scrypt gpu mining farm, I have >50% of coinex fees + I get % from cryptostocks share sells. Nothing criminal here again.
So again, please calm down. We are not doing a runner.
The only way i can see to restore this is to sell more shares at cryptostocks to cover the losses *and to hire a professional security audit team to prevent this from happening again*. Long story short, we’re covering this from our own pockets again.
Thanks - erundook”
Even though the statement was made too late, it still explains most questions that were posed by the community. Whether CoinEx will be able to recover all lost funds from their own pockets, remains to be seen. Selling shares may be a solution, but the community will only ease once they have definite proof that all coins are restored to the right users. To be continued!
We will keep an eye on this issue and provide updates when more news is available.
Bitcoin’s preeminent homeless-support charity,Sean’s Outpost, is under attack.
According to Bitcoin Not Bombs, the Escambia Board of County Commissioners authorized the county attorney to file an injunction on Sean’s Outpost and its “Satoshi Forest” project. The Board authorized the injunction with only three of the five commissioners present to vote.
The latest in a series of attempts by the City of Pensacola to hinder the operation of Satoshi Forest, this injunction may be intentionally coming at a time when the charity’s team is spread thin:
We have done everything in our power to abide by the law and follow all regulations, and may be about to be subpoenaed during a time where our land use attorney is out of town and Mike, myself, and our civil rights attorney Ali-stair will also be out of town this weekend. If they file an emergency injunction, we will have only 48 hours to appear.
This is not a coincidence.
While the rationale behind the action is “continued violations of Escambia Code of Ordinances and the Escambia County Land Development Code,” Sean’s Outpost contends,
The allegations being made against Satoshi Forest are falsified. [...] As of now a health inspector and code enforcer are being paid every week to inspect the property and no violations have been reported; in fact in the latest report it was written that the property has remained clean and orderly and is not in violation of any laws.
The County’s action against the Pensacola-based charity comes on the first anniversary of the creation of Sean’s Outpost. Satoshi Forest is a nine-acre property purchased with donations for the purposes of providing a safe territory for the city’s homeless to camp and grow edible gardens.
In addition to Satoshi Forest, Sean’s Outpost delivers meals and supplies to the homeless of Pensacola and operates a thrift store to raise funds.
Stay tuned to Bitcoin Not Bombs for an interview with Mike Kimberl for further clarification of this action.
The City of Pensacola and its surrounding county of Escambia have a reputation for authoritarian bullying, especially regarding the homeless. The city passed multiple ordinances designed to make life impossible for the homeless by preventing them from shaving or washing in public restrooms, sleeping with a blanket on public grounds, or asking for money. The “blanket ban” has since been repealed under extreme media pressure and a campaign by Sean’s Outpost among others.
Additionally, Escambia county sheriffs drew media attention when they fired seventeen times at an unarmed elderly man for allegedly breaking into his own car on his own property, and in another instance where sheriffs climbed into the window of a house without a warrant and shot two dogs belonging to the residents of the house, who were napping at the time. No charges were filed against sheriffs in either case. These heinous stories are not relevant to Sean’s Outpost or the homeless, but merely demonstrate the way authority is wielded in this small town.
And that is just last year. Actually, both incidents happened in the same week.
Breaking: Blockchain Outage And Cause Of The Issue
As you may already know, Blockchain went down 03/17/14 unexpectedly, the company responded saying that:
“We have temporarily suspended Shared Coin transactions while investigating some transactions that are “stuck”. The particular transaction in question is https://blockchain.info/tx-index/115315411/10. Rebroadcasting this transaction in bitcoind results, in Error code -22.”
The issue was not clearly known until Blockchain released a detailed report today. They said the cause of the outages were as follows:
“On Monday March 17th, Blockchain services experienced a series of technical issues that originated from a database error and resulted in the suspension of services. The issue was entirely unrelated to the earlier problems with the SharedCoin service; it was simply a timing coincidence. This was not the result of hacking or attacks, or of any suspicious activity. It was simply the result of an obscure bug and a combination of technical factors that expressed this bug under heavy load.”
The issue was apparently not caused by the previous issues they had with Shared Coin. They claim that their site was not hacked and that this was the result of a database error. Blockchain assures us that any and all funds are safe from theft or loss during the downtime. The developers have not given a set time for when the services will resume, only assuring us that all funds are safe and that the Blockchain team is working as hard as possible around the clock to get it all fixed within 72 hours. Blockchain wallet transactions are stored on the de-centralized Bitcoin system, meaning that Blockchain does not have access to them. Blockchain does not store any encrypted keys so the funds will remain safe, even under the event of an attack.
Some services have been partially restored, including the Blockchain explorer. Services and Databases are still down and are currently being worked on. Funds can still be manually withdrawn independently of their service, so it appears that things will be safe and secure. Many users have been manually withdrawing their coins to be sure that they are not lost. The website has launched some additional servers for the increased traffic of users that they are expecting to the site due to the outages. As people flock to withdraw their coins and to spectate on the issues, the servers could become overloaded, this preemptive measure seems like a good idea to keep things running smoothly. According to Blockchain, all wallet files and backups have been secured.
The next few days will tell the future of Blockchain though it appears they have control of the website by restoring some services. By restoring the Blockchain Explorer, the site has renewed some of the trust that had been lost during the unexpected outage of service. Users have been able to successfully withdraw their funds and it appears everything will return to normal with no loss, once they restore the service. Blockchain is offering help via a support request on how to withdraw balances to a desktop wallet. We will keep you updated on the developments that happen with Blockchain in the coming hours.
As promised Blockchain has successfully restored full services to their site. They have fixed the issue in a very timely manner and have successfully protected each user’s personal assets on the site. No funds were lost during the outage, and I believe that the site will only grow stronger because of this. The team promises to work hard to analyze what because the issue as well as making sure that it doesn’t happen again. Online wallet sites should take note of Blockchain’s system; it is a very good idea to make the wallet compatible with desktop wallets and make withdrawing funds possible even when the site is down. This feature would successfully protect individual assets under the event of an attack. The independence of the funds to the actual website is astounding and proved to be a great feature to an online wallet. I believe that Blockchain will learn from the mistake, and in the end grow to be an even stronger wallet. Mistakes are forgivable, especially when there was no loss, or loss of control. None of the users of Blockchain felt powerless during the outage because they were still in control of their funds throughout the whole affair. The developers have noted that there may be some performance issues as people all rush back into the service simultaneously; however, the service should be up and running normally within a day or two. There is no reason to panic or lose the trust in Blockchain because of this outage, the coins were handled very cautiously and responsibly the whole time, and were never in any danger of loss or theft because of the great security system Blockchain has.
Bitcurex is back in business after thwarting a major hacking attack.
Last week, Poland’s largest bitcoin exchange, Bitcurex,halted all trades to investigate a hacking attack. A malicious user attempted to obtain 19,000 BTC from the exchange with a fraudulent buy order. However, the site was shut down within 5 minutes of the buy order, and Bitcurex offered the following statement soon afterwards:
We successfully blocked a hacking attack on Bitcurex, preventing mass theft of BTC funds of our users. Thanks to automatic safety procedures, hackers managed to defraud only a portion of the funds stored in operational Hot Wallet Bitcurex. The majority of funds from Hot Wallet, as well the entirety of funds from Cold Wallet and FIAT monetary funds remained intact.
Our team located and removed the source of the problem. We are working on resuming normal service, at the same time an external audit is being conducted: we will soon provide the exact date of resuming all Bitcurex functionalities. More information will be provided in further statements.
We are sorry for the inconvenience, and most of all we thank the whole BTC community for the support we received: we were put to a test that will make us stronger.
Furthermore, Bitcurex promised to begin resuming operations on Tuesday, 18 March.
We inform that Bitcurex PLN will be resumed tomorrow, on March 18 at 12:00. Bitcurex EUR will be resumed on thursday on March 20, also at 12:00.
It looks like the team at Bitcurex were true to their word, because the exchange has restored PLN (Polish Zloty) operations. Furthermore, Bitcurex will fund hot wallet losses with their own money. In addition, all passwords have been reset, so any user attempting to log in should use the password recovery function on the site. While prices took a hit after Bitcurex went back online, they seem to be steadily recovering. It should come as great news to everyone that Bitcurex was able to successfully and professionally thwart a hacking attempt and resume operations in a timely manner. Unlike Mt. Gox, Bitcurex knows how to handle a potential crisis.
Additional information and updates are available on the Bitcurex website and Facebook page. This post will also be updated with any major news regarding today’s announcement.
Last month, the Bank of Thailand allowed the country’s largest Bitcoin exchange site to resume operations.Bitcoin.co.th was forced to shut down in August last year, after Bank of Thailand ruled that the using and trading of cryptocurrencies was illegal. In February this year, the exchange was allowed to start up again, when Bank of Thailand suddenly changed their opinion and stated that Bitcoin was legal again. At least, that’s what Bitcoin.co.th thought.
In reality, the exchange got hold of a letter of the Bank of Thailand. The letter stated that bitcoin exchange operations do not fall under the scope of Finance Ministry regulations, unless foreign currencies are also offered for exchange. Bitcoin.co.th only offers bitcoin trading for baht and operates solely within Thailand.
Of course, the Bank of Thailand wasn’t happy with this sudden change, they issued another warning by saying the exchange interpreted the letter in their own interests. Some even claimed that reopening the exchange was a bad decision which will have consequences. Until now, Bitcoin.co.th remains open to the public, offering all of its services without any restrictions.
The Bank of Thailand remained silent for a few weeks, contemplating how they should approach this the best way. Today, they woke up again, issuing another statement on Bitcoin and cryptocurrencies in general. Here’s how the Bank of Thailand describes Bitcoin: “Bitcoin is electronic data. Thus, it’s not considered a currency and can’t be used for payments, and it’s not considered legal tender like money. With no self worth, the value of such data varies based on the needs of the market. Bitcoin changes in value very quickly and it could become something of no value if none desired it.”
To clarify its opinion, the Bank of Thailand asks Thais to take a close look at what happened at Mt. Gox. The exchange has been at the center of attention for weeks now, and no good news has come of it ever since. This is an easy way for government authorities to criminalize Bitcoin and discourage potential users of buying and trading the virtual currency. Bank of Thailand made it clear that, in case of theft, loss of value or fraud, Thai people cannot claim damages because there’s no law to regulate Bitcoin in Thailand.
What’s interesting about the way the Bank of Thailand has been acting, is the way they seem to change opinions quite often. Bitcoin remained legal until authorities took notice of increasing popularity within the Thai borders. After that, the currency was made illegal. All trading took a stop and Thai that wanted to keep trading Bitcoin were forced to use sites that were situated abroad. This remained possible, even with Bitcoin’s supposed illegality.
In February, the country’s largest exchange opened up again. If the country’s opinion on the coin were shared, measures would have been taken to get Bitcoin.co.th to close its doors again. Instead, the site was allowed to remain open, Bank of Thailand simply released a statement warning the people. This shows that officials’ opinions are divided. Some love Bitcoin, others hate it. It’s interesting to see what stance Thailand will take in the future towards cryptocurrencies. I wouldn’t be surprised to see a more detailed statement quite soon.