Crypto News Roundup — August 10, 2019

Weekly Crypto News

Crypto News Roundup — August 10, 2019

At-A-Glance

  • Experts say the crypto winter is over — BTC price broke $12,000 for the second time in three days while stocks plunged amid recession fears.
  • A UN report suggests that North Korea has earned $2 billion through cryptocurrency cyberattacks, which may be used to fund nuclear weapons development.
  • A California couple has pleaded guilty to selling illicit goods on the darknet in exchange for crypto — they will now be forced to forfeit large sums of BTC and BCH.
  • The Fed plans to release a real-time payments service, but crypto bulls remain ambivalent, saying “Bitcoin already exists.”

Bitcoin climbs above $12,000 as investors treat it like a safe haven amid global recession fears (BTC)

Markets Insider

Bitcoin (BTC) price broke $12,000 for the second time in three days on Wednesday. Meanwhile, risk assets fell due to fears about an impending global recession. Investors are increasingly regarding cryptocurrency as a safe-haven asset, despite its volatility. Some experts even argue that cryptocurrency is shielded from some of the geopolitical effects that move other markets.

US stocks dropped due to recession fears on Wednesday, following their worst day of 2019. Experts believe that trade tensions are responsible for the market’s apprehension. Following this, cryptocurrency and other safe-haven assets, such as gold, boomed. Because Bitcoin is decentralized and operated by a distributed network, it’s harder to manipulate the circulating supply. Sky Guo, CEO of Cypherium believes this could be the reason why crypto is perceived as a store of value.

Thomas Lee, an analyst at Fundstrat, notes that Bitcoin still has some recovery to do. After Facebook’s Libra announcement and the ensuing senate hearings, BTC dropped 18%. However, in his view, the crypto winter is finally over.

“The recent Bitcoin rally strengthens the argument for Bitcoin as a store of value,” Ken Xuan, a data scientist at Fundstrat, said in a note Monday.

[Thomas Lee of Fundstrat] noted that the cryptocurrency is becoming less tied to the US dollar, while its adherence to equity performance has also decreased in 2019. Meanwhile, bitcoin has gotten more closely correlated with gold over the last 100 days.

The “crypto winter” is likely over, Lee says. Bitcoin is up roughly 215% this year, though it’s far below its highest price near $20,000 set in 2017.

North Korean cryptocurrency heists net estimated $2 billion: UN report

CNN

This week, a UN report accused North Korea of executing large-scale cyber attacks that earned as much as 2 billion dollars worth of cryptocurrency. According to investigators, these funds may be appropriated to North Korea’s nuclear weapons and ballistic missile development program.

These allegations were published by a UN panel of independent experts that monitor sanctions in North Korea. Previous reports have hinted that North Korea may have been evading sanctions through illicit crypto transactions. However, this report follows news that Pyongyang fired two short-range ballistic missiles early on Tuesday — the fourth missile launch in less than two weeks. While those launches don’t violate the implicit agreement made to the US, they do violate UN Security Council resolutions.

Some experts speculate that North Korea has dedicated hacking resources to evading UN and US sanctions. The Trump administration remains resolute that it will not remove the measures until North Korea has halted all nuclear activity.

[The report] accuses North Korea of using hackers to conduct “forced illegal transfers of funds from financial institutions and cryptocurrency exchanges, launder stolen proceeds and created income to avoid international sanctions.”

Investigators say those activities may help fund North Korea’s nuclear weapons and ballistic missile development.

Experts say that North Korea has invested significant resources in developing a sophisticated array of cyber capabilities and a robust network of hackers who have increasingly been used to evade United Nations and US sanctions…The Trump administration has said it would not remove the measures until it could verify that North Korea has given up its nuclear weapons, while Pyongyang has pushed for a phased approach to sanctions relief.

California Couple to Forfeit Cryptocurrency Riches After Drug Bust

Coindesk

This week, a California couple has pleaded guilty to a series of crimes related to selling illicit goods on the darknet in exchange for cryptocurrency. They operated a number of vendor accounts on Dream Market, an anonymized marketplace, and sold controlled substances including cocaine and methamphetamine. The couple, Jarabi and Saudia Monson, have pleaded guilty following a Homeland Security Investigation. They will now be forced to forfeit all Bitcoin and Bitcoin Cash profits, and possibly subjected to fines as high as $5 million.

Between July 2018 through January 2019 the couple operated vendor accounts named “Best Buy Meds,” “Trap Mart” and “House Of Dank” to distribute cocaine, cocaine base, methamphetamine, and marijuana.

Following an investigation conducted by the Homeland Security Investigation, the Federal Bureau of Investigation, the Drug Enforcement Administration, and the U.S. Postal Inspection Service, Jabari Monson pleaded guilty to conspiring to distribute controlled substances. He faces a maximum sentence of 40 years and a $5 million fine.

Saudia Monson pleaded guilty to violating the Travel Act and using the mail and internet to distribute controlled substances. She faces a maximum of 5 years in prison and a $250,000 fine.

US Federal Reserve Launching Payment System, Crypto Bulls Nonplussed

CoinTelegraph

In a press release, the United States Federal Reserve has revealed that it will fund the development of a new interbank real-time settlement service. By launching this payment system, called FedNow, the Fed aims to modernize the country’s payment system by allowing consumers to more flexibly manage their money. FedNow will reportedly be available both to businesses and the general public. It will allow users to make time-sensitive payments more quickly and securely than standard banking methods. The system will launch in 2023 or 2024.

Meanwhile, the cryptocurrency community was nonplussed: Why invest in this system when crypto exists? Crypto bull Anthony Pompliano, co-founder of Morgan Creek Digital Assets, tweeted that “Bitcoin is already available.” Others were more diplomatic in their responses but, by and large, the community seems to think the Fed is behind the curve.

Gabor Gurbacs, director of digital assets strategy at MV Index Solutions, a subsidiary of investment management firm VanEck, tweeted: “Great that the @federalreserve is taking a forward-looking and intelligent stance regarding innovation in #DigitalAssets and #payments. I recommend considering the benefits of #Bitcoin, a functioning, reliable, trust-minimized base-layer for sound money.”

The Federal Reserve cut interest rates last week, a move which some experts say could be partially responsible for Bitcoin’s (BTC) recent price rally. Fundstrat Global Advisors co-founder Tom Lee said:

“Bitcoin’s becoming increasingly a macrohedge for investors against things that could go wrong. Rate cuts are adding liquidity. Liquidity is pushing money into all these risk assets and also hedges, which is helping Bitcoin.”

That’s the roundup for August 10th. Check in next week for the latest news of cryptocurrency innovation and regulation around the world!

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