bitcoin

Thursday, March 30, 2023

Gnosis launches Hashi bridge aggregator to help prevent hacks

Bridge protocols LayerZero, Celer, Wormhole, LiFi, and others have already committed to implementing the new protocol.

Gnosis, the team behind Gnosis Safe multi-sig and Gnosis Chain, has launched a hash oracle aggregator for blockchain bridges, according to an announcement from the company. In a conversation with Cointelegraph, Gnosis CEO Martin Köppelmann stated that the new aggregator should make bridges more secure by requiring more than one bridge to validate a withdrawal before it can be confirmed.

Multiple bridge protocols have already committed to integrating with Hashi, including Succinct Labs, DendrETH, ZK Collective, Connext, Celer, LayerZero, Axiom, Wormhole and LI.FI, according to the announcement.

Over $2 billion was stolen from bridges in 2021 and 2022, according to a report by Token Terminal. Bugs in the code have caused some bridge hacks, whereas others have been caused by the attacker taking over a multi-sig governance wallet.

According to Köppelmann, Hashi can provide the first step towards making these cross-chain transactions more secure throughout the blockchain ecosystem, by requiring withdrawals to be validated by multiple bridges instead of just one:

Hashi is about essentially creating this aggregator that can use different bridges and basically say they all need to agree to the same message [...] If they do, great, then we can be really, really certain that this message is actually real and if they disagree [...] Then we know we need to escalate to governance, we need to halt the bridge.

Köppelmann also emphasized that Hashi helps to prevent multi-sig governance attacks because it allows a protocol to prevent governance from intervening if there is no disagreement between individual bridges.

“Here you can have this nice tradeoff where you say ‘the governance is not allowed to do anything,’ so it cannot interfere with the system unless there is explicitly a conflict or a bug," he explained. "So as soon as those bridges that are supposed to report on the same thing [...] Disagree, well then governance is allowed to interfere, otherwise governance has no role. That’s Hashi.”

Hashi is open source and available on GitHub.

The idea of a multi-bridge aggregator rose to prominence during the Uniswap bridge debate in December and January. Although Wormhole was ultimately chosen as Uniswap’s bridge provider, representatives from Celer, LiFi, and deBridge, as well as other participants concluded that a multi-bridge aggregation solution needed to be implemented going forward.

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Terra co-founder Do Kwon's jail time in Montenegro will be harsh: Report

Now in custody in Montenegro, Do Kwon could be facing "at least a year" behind bars as the country considers extradition requests, according to one criminal defense lawyer.

Do Kwon, currently in custody in Montenegro and potentially awaiting extradition to the United States or South Korea, will reportedly face harsh conditions in the country’s penal system.

According to a March 29 Protos report, an unnamed criminal defense lawyer said conditions at Montenegro’s jails and prisons “haven’t changed” from those described in a 2020 human rights report from the U.S. State Department. The report cited a case in which prison officers had been convicted of torturing and “inflicting grievous bodily harm” on 11 inmates in 2015, as well as other “poor” conditions in some of Montenegro’s prisons due to overcrowding and lack of medical care.

Citing reports from the Council of Europe’s Committee for the Prevention of Torture, the State Department said many prisoners had been confined to overcrowded cells for roughly 23 hours a day, with some reports of violence between inmates. Kwon could be facing “at least a year” in such conditions as Montenegro considers extradition requests, depending on the outcome of his criminal case over allegedly forged travel documents.

“Rooms are 8 meters squared and very crowded,” the lawyer reportedly said. “There’s about 10 to 11 people in a room — there’s usually not even a bed.“

This is a developing story, and further information will be added as it becomes available.

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Kraken aims for restricted dealer registration in Canada to comply with new rules

In February, Canadian Securities Administrators announced enhanced investor protection requirements for crypto asset traders.

Crypto exchange Kraken has filed a preregistration undertaking with the Ontario Securities Commission in Canada seeking restricted dealer status. United States-based Kraken is already active in Canada and is acting to comply with the new guidance.

Kraken is registered in Canada as a money services business and has been operating there for over 10 years. The Canadian Securities Administrators (CSA) implemented new guidance for crypto asset trading platforms on Feb. 22, requiring Kraken to file a preregistration undertaking legally committing it to observe new investor protections.

The new requirements for crypto trading platforms will be subject to include new custody standards, restrictions on the use of leverage and a ban on trading stablecoins without prior written consent from the CSA. Kraken managing director for Canada Mark Greenberg said:

“We want both existing and prospective clients to know Kraken remains committed to Canada.”

Restricted dealer registration is “a special kind of dealing registration used for firms that do not quite fit under any other category” under CSA definitions. Regulators tailor requirements for firms with this status individually.

CRYPTO changes for Canada are coming! #crypto #Bitcoin #canada pic.twitter.com/40qLdQLLru
— megbzk (@megbzk) March 26, 2023

Cryptocurrency exchange OKX announced on March 20 that it would stop providing service to Canadian customers within three months due to “new regulations.” OKX added that its withdrawal from the country was temporary and it was working with regulators.

The CSA is the umbrella organization for Canada’s 13 regional securities regulators. There is no federal Canadian regulator. Registration by one CSA member provides a so-called “passport” for firms doing business in other provinces or territories.

In February, Kraken paid $30 million in penalties and disgorgement in the United States after the Securities and Exchange Commission charged it with failing to register its staking-as-a-service program as a security. Kraken said at the time that it would continue to offer its staking program to non-U.S. customers.

Magazine: Best and worst countries for crypto taxes — Plus crypto tax tips

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Bitcoin profits are taxable in certain cases, says Denmark’s supreme court

The country’s supreme court released two decisions for cases in which different crypto users gained profits from sales of BTC “made for the purpose of speculation” and mining.

The Justices of the Supreme Court of Denmark have handed down two judgements on whether the sale of Bitcoin (BTC) under certain circumstances qualifies as a taxable event.

In a March 30 notice, Denmark’s Supreme Court said a party who gained profits from selling Bitcoin acquired through several purchases and donations was required to report the sale as a taxable event, adding the purchase was “made for the purpose of speculation.” In a separate case, the court ruled a user who mined their own BTC and later sold the coins would be subject to the same tax consideration.

Both cases considered by the supreme court involved the acquisition of BTC between 2011 and 2013, with sales between 2017 and 2018, suggesting a price difference in the thousands of dollars. The court cited sections of the country’s National Tax Act, noting it had considered the first seller’s intent to eventually sell the coins based on a post in a 2011 Bitcoin forum.

“The Supreme Court finds that the received Bitcoins must be considered assets acquired with a view to later turnover as an integrated part of [the first party]’s business with the development and operation of software for Bitcoins,” said the ruling. “They cannot be considered at the time of sale to have been transferred to be [their] private property or assets. On that basis, the Supreme Court finds that the relinquishment of the Bitcoins received constituted revenue in [their] non-commercial business. Sales therefore trigger tax liability.”

Coincub reported in September 2022 that gains earned from crypto in Denmark could incur a tax rate of roughly 37% but also up to 52% depending on whether the user has a high income. This would place the country well above crypto tax rates in the United States subject to its capital gains laws — between 0% and 37% depending on whether the taxpayer sells assets held for more or less than a year and their income bracket.

Magazine: Best and worst countries for crypto taxes — Plus crypto tax tips

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Wednesday, March 29, 2023

Bitcoin mining stocks underwhelm in March, but brighter days could be around the corner

In March mining stocks increased at a slower pace compared to BTC, amid macroeconomic uncertainty and increasing competition among Bitcoin miners.

Bitcoin mining stocks had a dull performance in March, with small moves here and there that followed BTC's price movement. While it is encouraging to see that most stocks held onto their impressive January gains, Bitcoin's price action will be crucial for the short-to-medium-term performance of these stocks.

Additionally, the expansion of the public Bitcoin mining sector in the U.S. continues as American miners reported one of the biggest ASIC imports in January 2023. The delivery of new machines and an increase in the BTC price led to a surge in the network's hashrate to new all-time highs. Miners' incomes, however, are subdued by the rising network difficulty.

Mining stocks are in wait-and-see mode

Despite Bitcoin’s recent 18% rally, subdued performances of most mining stocks can be attributed to the uncertainty around the sustainability of Bitcoin’s price rally and the increasing competition in the mining industry. The Hashrate Index, a proxy for Bitcoin mining stocks, increased 10% in March from 1,929 to 2,141 points.

The median monthly gain in the top ten mining stocks is 0.30%, with an average of 5.21%. Riot Platforms and Cipher Mining led the monthly gains across the sector with a 28.64% and 24.34% rise. CleanSpark, Inc. and Bitfarms Ltd. were the worst performers, with negative 6.52% and 5.79% moves.

*The performance of the top ten Bitcoin mining stocks as of March 28.*

The average Q1 2023 gains across the top ten Bitcoin mining stocks is 128%. These shares yielded the majority of their Q1 2023 gains in January. The following months, February and March, saw a muted performance from most mining company stocks.

The chart of Marathon Digital’s stock perfectly illustrates the price action across the industry, with a tall candle in January, followed by small moves in the next couple of months.

*MARA/USD monthly price chart. Source: TradingView*

Currently, mining firms are focused on expanding and sustaining their operations rather than profits. Marathon Digital increased its mining capacity by 30% in February. The firm’s aggressive expansion will increase its production capacity from 9.5 EH/s to 23 EH/s by mid-2023.

At the same time, Canadian mining firm Hut 8 Mining Corporations announced a merger with the U.S.-based Bitcoin Corp to combine their resources and weather the downturn across the industry.

The network’s hashrate soared as new ASICs flood the market

The Bitcoin network’s hashrate increased to an all-time high of 348 exahash per second (EH/s) from 320 EH/s in the last week of March.

The revenue of miners jumped around 30% after the recent rise in BTC price, increasing from $65 per petahash per sec (PH/s) per day in Q4 2022 to around $85 per PH/s per day in Q1 2023. However, Bitcoin’s price jumped over 60% during the same period.

The increase in Bitcoin’s price is only part of the reason behind the hashrate surge. The discrepancy in miner incomes can be attributed to the increasing mining difficulty. It was mainly due to the delivery of new machines across America, which increased the network’s processing power and difficulty.

In January 2023, U.S. miners reportedly imported 1,555 tons of machines, which has propelled the network’s hashrate to its current peak.

*Bitcoin monthly estimate of miner shipments and the network’s hashrate. Source: TheMinerMag*

The rise in the network’s hashrate has limited the revenue of miners, which may adversely affect miners' incomes if BTC prices were to fall from here.

There’s a probability that the network’s hashrate could plateau around current levels. The MinerMag report added:

"If there’s no major uptick in the shipment gross weight in the rest of March and into April, the growth rate of bitcoin’s network hashrate may gradually slow down.”

Bitcoin’s price performance will continue to play a significant role in the growth of the mining sector, but BTC price must sustain its current level or move higher for positive revenues and a continued uptrend in public stocks.

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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'Definitely not bullish' — 7% Bitcoin price gains fail to convince traders

Bitcoin simply hasn't dealt with the worst of resistance in a key trading range for everyone to flip bullish.

Bitcoin (BTC) may have erased its Binance “FUD” losses, but popular traders are anything but bullish.

Despite gaining up to 7.5% versus its March 28 lows, BTC/USD is causing more suspicion than excitement with its return to local highs.

$30,000 stays breaker for bullish sentiment flip

In a move which echoes its reactions to previous news events such as the Silicon Valley Bank demise, Bitcoin has recovered snap losses in record time.

On March 29, BTC price action hit $28,650 on Bitstamp — just $200 off new nine-month highs.

Unlike before, however, the mood among market participants is distinctly risk-off under current conditions.

Among them is popular trader Muro, who argued that the bounce came courtesy of large-volume traders and was nothing more than a product of their strategies.

“The big guys basically brought price back to their recent short entry (red) by taking profit,” he commented alongside a chart of BTC/USDT perpetual futures.

“I’m definitely not bullish. Going small risk short again.”

*BTC/USDT perpetual swaps annotated chart. Source: Muro/ Twitter*

Others looked to longer timeframes to make the case for Bitcoin at least taking a breather in its current trading range.

Historically, the area around $28,000 has been the most active in terms of volume, and attempts to flip it from resistance to support thus require exceptional strength.

“What is more important, the local weekly breakout of a multi-month range, or the retest of the most significant supply zone in the last 2 years while we face all kinds of headwinds?” trader and analyst Cantering Clark argued.

“I will get just as bullish as every carnival barker when we are above 30k. Also, not for nothing, in trending markets there should be nothing wrong with buying higher. Until then, respecting resistance and positioning in accordance with that.”

Fellow trader and analyst Josh Rager agreed, adding a BTC/USD chart showing the significance of the range.

*BTC/USD annotated chart. Source: Josh Rager/ Twitter*

China liquidity among day's macro triggers

BTC/USD meanwhile traded at $28,300 at the time of writing, according to data from Cointelegraph Markets Pro and TradingView.

*BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView*

The day's Wall Street open offered little by way of additional momentum, despite United States equities trending higher

Analytics account Tedtalksmacro nonetheless noted the resumption of liquidity injections from China's central bank — a potentially key event given crypto markets' susceptibility to central bank liquidity.

The Chinese Central Bank are adding liquidity again.

Largest injections via reverse repo in a month. pic.twitter.com/94NHc7lMCk
— tedtalksmacro (@tedtalksmacro) March 29, 2023

As Cointelegraph reported, all eyes continue to be on the U.S. for the release of key macro data later this week.

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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XRP price tags 10-month high — Can a 35% pullback be avoided?

A U.S. regulator called Bitcoin, Ether, and Litecoin commodities in its court filing against Binance. It did not mention XRP anywhere.

XRP (XRP) outperformed its top-ranking crypto rivals over the past 24 hours while reaching the highest price in 10 months.

XRP price tags 10-month high

On March 29, XRP's price surged by nearly 15% to $0.58, its highest level in ten months, outperforming Bitcoin (BTC) and Ether (ETH) in the past 24 hours that rose around 4.5% and 2.75%, respectively.

*XRP/USD daily price chart. Source: TradingView*

The Commodity Futures Trading Commission (CFTC) referred to Bitcoin, Ether, and Litecoin (LTC) as "commodities" in its court filing against Binance. While the U.S. regulatory didn't name XRP, many assumed the token would be categorized as a commodity.

The lawsuit will likely conclude by the end of March, with legal experts believing Ripple has a chance to win. XRP price has rallied 45% month-to-date on similar hopes, including the March 29 price rally, supplemented further by investors' optimistic interpretation of the CFTC court filing.

#XRP bucks the market trend with 8% surge to a 5 month high of under $0.50#CFTC's #Binance filing could classify $XRP as a commodity instead of a security as alleged by #SEC in #Ripple vs SEC case@Ripple's CTO argument gains traction and XRP price impacted by case progression pic.twitter.com/eFB28Ehmj0
— LaCryptoLycus (@CryptoLycus) March 28, 2023

35% XRP price correction ahead?

XRP's price rally brought it closer to the breakout target of $0.60. However, the possibility of a big correction after the SEC vs. Ripple ruling as a "sell the news" event remains.

Related: Why is XRP price up today?

Technical indicators also show the XRP/USD pair facing the upper trendline of its prevailing rising channel. Thus, a correction toward the lower trendline is now in play, with the downside price target around $0.38 in April, down 35% from current price levels.

On a broader timeframe, the rising channel appears like a bear flag, a bearish continuation technical indicator.

*XRP/USD weekly price chart. Source: TradingView*

The completion of the flag pattern could see XRP price falling to $0.189 by June, down over 65% from current price levels

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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