Cryptocurrency exchange Gate.io has just launched its own brand of hardware wallets. Called the Wallet S1, these are the first hardware wallets launched by an exchange.
Gate.io’s Wallet S1 has eliminated the need for passwords, instead opting for fingerprint scanning to confirm crypto operations.
Fingerprint recognition eliminates a key attack vector: Brute force attacks. For password-encrypted services or devices, black hat hackers can submit a series of password attempts until they successfully guess the password.
The CMO of Gate.io, Marie Tatibouet, said that the Wallet S1’s “world-leading fingerprint algorithm” blocks this threat. This feature does not protect the wallet from all threats, however.
In addition to the exchange itself, the hardware wallet will be a secure way to connect to GateChain, the exchange’s native blockchain network.
“For enterprise-grade use cases, Wallet S1 can be used in combination with a Vault address at GateChain –a public chain focused on security, to achieve enhanced safety for large scale asset storage as a business or financial institution,” wrote Gate.io.
This is the first time a company has launched its own hardware wallet to connect to its native blockchain. In comparison, other platforms like Binance DEX, which operates on Binance Chain, offer support for third-party hardware wallets like Ledger to safeguard user funds.
The hardware wallet can be used in tandem with Gate.io’s web-based wallet called wallet.io pro. After logging into their dashboard, users can add an extra layer of security with Wallet S1.
According to marketing materials, the hardware wallet will be available in the next four months and priced around $50 per unit.
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- P2P Crypto Exchange LocalBitcoins Blocked By Russian Authorities
- Russia Blocks P2P Crypto Exchange LocalBitcoins
- The DOJ’s Crypto Framework Is a Warning to Exchanges
- Regulation Of Cryptocurrency And Digital Assets In Nigeria: New Beginnings – Technology
- Centralized Exchange Operators Believe Low Liquidity on DEX Platforms Stops User Migration
P2P Crypto Exchange LocalBitcoins Blocked By Russian Authorities
Russian telecom authority has banned P2P cryptocurrency exchange LocalBitcoins in the country. Russia is the biggest market for the exchange.
Roskomnadzor, the telecommunication services regulator in Russia, blocked the LocalBitcoins portal in the country. The P2P crypto exchange gets a huge portion of its traffic from Russia. In fact, the Russian market is one of the most crucial crypto markets in the world. The government isn’t too keen on letting the industry flourish.
The domain working in Russia was localbitcoins.net, a mirror of the original .com site focused on the country. However, traders now find themselves with a blank page as the website is being censored. The only way for Russian users to access this site is via a VPN that can help in hiding their actual location.
Traders in Russia have remained very active on LocalBitcoins and local ads have not stopped on the website. This suggests that traders were likely already prepared for the government’s censorship actions. LocalBitcoins was last blocked in the country four years ago. Binance also announced last month that it was being blocked in Russia, even though it isn’t listed on the government’s official blacklist database.
Russia had made its hawkish stance on cryptocurrencies clear this summer, when it declared restrictions on LocalBitcoins on July 21. The authorities said that the site could be disseminating illegal information to the users. The country is also creating its cryptocurrency laws. It is still legal to hold office in the country but using them as a method of payment is restricted.
The authorities aren’t too keen on cryptocurrencies but the users love Bitcoin and other digital assets. Russia accounts for about 20% of the total operations of LocalBitcoins and is its largest P2P crypto trading market. LocalBitcoins has not released any official statement on the matter yet. However, it is clear that their operations haven’t taken a hit because of the censorship yet.
Remember, all trading carries risk. Past performance is no guarantee of future results.
Russia Blocks P2P Crypto Exchange LocalBitcoins
Russia is among the world’s most vital Bitcoin markets, however its authorities appears prepared to dam blockchain transactions.
Roskomnadzor, Russia’s telecommunications providers regulator, has blocked entry to LocalBitcoins’ portal within the nation, which is a significant supply of visitors to the peer-to-peer alternate.
When attempting to entry localbitcoins.internet—a mirror of the .com website targeted on serving clients within the nation—merchants discover themselves with a clean web page after being censored by the regulator. To entry the portal, Russian customers should use a VPN that masks their precise location.
Up to now, Russian merchants appear to have remained fairly energetic on LocalBitcoins, and buyer advertisements on the location have not stopped. This might point out that merchants have been already ready for—or used to—the sort of censorship.
Which they need to have been. LocalBitcoins was beforehand blocked by Roskomnadzor 4 years in the past. Furthermore, final month, Binance announced it too was blocked. Nonetheless, the location is now not within the authorities’s blacklist database.
And Russia had telegraphed its intentions earlier this summer time, declaring restrictions on entry to the LocalBitcoins portal on July 21, 2020, based mostly on the justification that the location might be disseminating unlawful data to the general public.
That coincided with an overhaul to Russia’s cryptocurrency legal guidelines. Although it stays authorized to personal Bitcoin and different cryptocurrencies in Russia, they’re now illegal to use for fee.
Regardless of the federal government’s difficult relationship with Bitcoin, Russians love crypto. The nation accounts for nearly 20% of LocalBitcoin’s whole operations and ranks first when it comes to cryptocurrency buying and selling in P2P markets.
LocalBitcoins has not issued any official assertion. Decrypt has requested further data and can replace the information if any response is obtained.
— to decrypt.co
The DOJ’s Crypto Framework Is a Warning to Exchanges
The Department of Justice (DOJ) just fired a warning to crypto exchanges worldwide: Comply with U.S. law or face the potential wrath of the federal government.
Last week, the DOJ published an 83-page cryptocurrency enforcement framework detailing its approach to the nascent space and discussing potential crimes. The document also suggested the U.S. government would enforce its laws regardless of where exchanges – referred to as virtual asset service providers, or VASPs – are based. In other words, these exchanges should comply with U.S. laws – even for their non-U.S. customers:
“The Department also has robust authority to prosecute VASPs and other entities and individuals that violate U.S. law even when they are not located inside the United States. Where virtual asset transactions touch financial, data storage or other computer systems within the United States, the Department generally has jurisdiction to prosecute the actors who direct or conduct those transactions.”
The document came just days after prosecutors with the U.S. Attorney’s Office for the Southern District of New York (SDNY) brought charges against crypto trading platform BitMEX, which is headquartered in the Seychelles, and its leaders, some of whom do not reside in the U.S.
“I do think this is definitely a warning shot about cryptocurrency exchanges that are located outside the U.S.,” Marta Belcher, special counsel to the Electronic Frontier Foundation and general counsel at Protocol Labs, said of the framework.
Interpreted broadly, the DOJ’s framework can also have implications for international exchanges that may have – or at one point, had – customers in the U.S. Exchanges that pulled out of the U.S. may not be safe either, based on the BitMEX charges.
That’s not to say every exchange operating outside the U.S. is at risk, or that the federal government is declaring open season on platforms it believes should be complying with its laws. Still, overseas exchanges that might have exposure to the U.S. should take note.
The DOJ framework notes that the U.S. has had anti-money laundering/countering the financing of terrorism (AML/CFT) measures for decades, with specific standards around cryptocurrency exchanges and activities since at least 2011.
Despite this, many VASPs, as the U.S. government refers exchanges – still do not necessarily comply with the Bank Secrecy Act or other laws, the framework claimed. The framework complained that some exchanges might hold U.S. customers to standards that do not apply to non-U.S. customers, or might treat crypto-to-crypto transactions differently from crypto-to-fiat transactions.
“Because of the global and cross-border nature of transactions involving virtual assets, the lack of consistent AML/CFT regulation and supervision over VASPs across jurisdictions – and the complete absence of such regulation and supervision in certain parts of the world – is detrimental to the safety and stability of the international financial system,” the framework said.
Jake Chervinsky, general counsel at Compound Finance, tweeted that policy makers are looking to tighten global restrictions on the trading of digital assets, in a change from how the crypto space was previously viewed.
In the DOJ’s view, international regulations should be consistent, the document said.
The new framework follows a pattern. Since 2018, the U.S. has spearheaded efforts to unite global regulatory efforts around cryptocurrency exchanges and transactions through its presidency of the Financial Action Task Force (FATF), an intergovernmental standards-setting organization.
Last June, when the U.S. was president, the FATF unveiled the so-called “Travel Rule” for VASPs, advising regulators to require exchanges hold or be able to access comprehensive KYC data, even for individuals receiving funds from a transaction but who weren’t their own customers. The FATF is composed of representatives from the Group of 7 nations, and the presidency rotated between member nations every year at that time.
Implementation of the travel rule is ongoing. Some countries already require strict KYC, while others are still determining what compliance might look like. Switzerland, for example, requires exchanges to verify personal wallets before allowing customers to withdraw their crypto.
The U.S. has gone after non-domestic platforms in the past. The Commodity Futures Trading Commission (CFTC), Securities and Exchange Commission and Federal Bureau of Investigation charged 1Broker, a crypto product exchange based in the Marshall Islands, on claims that it allowed U.S. customers to trade on its platform.
1Broker later settled the charges with the two agencies, allowing customers to withdraw funds through the end of 2019 before shutting its doors.
Earlier this month, the SDNY and the CFTC unveiled a variety of charges against BitMEX, one of the world’s largest crypto derivatives trading platforms – based in the Seychelles – as well as owners Arthur Hayes, Ben Delo and Samuel Reed. (SDNY brought an additional charge against Gregory Dwyer, an employee.)
Both agencies allege U.S. residents were able to trade on BitMEX, despite the company not registering as a futures commission merchant, derivatives contract market or swap execution facility with the CFTC or conduct know-your-customer processes in compliance with the Bank Secrecy Act.
According to the indictment, the DOJ is alleging the defendants violated the Bank Secrecy Act and conspired to violate the Bank Secrecy Act across two separate charges. These charges could face criminal penalties, including jail time in addition to monetary fines.
“Beginning no later than November 2014 and continuing to the present (the ‘Relevant Period’), Defendants have offered commodity futures, options, and swaps on digital assets, including bitcoin, ether and litecoin, to persons in the United States, from offices in the United States, through the website www.bitmex.com and a mobile application,” the indictment said.
Speaking at the Digital Asset Compliance & Market Integrity Summit hosted by Solidus Labs last week, CFTC Commissioner Dan Berkovitz hinted the agency may go after other platforms that violate U.S. law in some way – even if they aren’t based in the U.S.
“I think it’s very clear that if you’re operating outside the boundaries of the law and what the law requires, we will aggressively enforce it,” he said.
Berkovitz’s comments, alongside the enforcement framework itself, seem to be implying the BSA, a broad AML/KYC-focused law, are applicable outside of the U.S.
In other words, any transactions that might fit into the U.S. regulatory framework is fair game for enforcement, he said, a view the enforcement framework appeared to endorse.
“They’re extremely explicit that they feel they have authority to prosecute them if they violate U.S. laws even when they’re not located in the U.S.,” Belcher said. “There’s a pretty long section where they, I think, make it pretty clear that is a thing they are contemplating.”
This should not be a surprise, she added, saying this is at least “one takeaway” from the simple fact the paper was published.
The framework even acknowledges the DOJ’s past international efforts, saying the agency has “actively participated in international regulatory and criminal enforcement efforts” in the past.
The DOJ, alongside its law enforcement and civil agency partners, is likely to take advantage of this perceived authority.
“Where the law is clear, we will enforce it,” Berkovitz said.
Regulation Of Cryptocurrency And Digital Assets In Nigeria: New Beginnings – Technology
4. The Introductory Paragraph of the
Author: News Bureau
Centralized Exchange Operators Believe Low Liquidity on DEX Platforms Stops User Migration
Centralized cryptocurrency exchanges (CEX) operators say they are unfazed by the increasing trading volumes on decentralized exchanges (DEX) because the latter’s liquidity is still too insignificant to cause user mass migration. The majority of CEX operators also insist that it is very unlikely the DEXs’ liquidity would surpass their own liquidity in 2 years’ time.
The comments by operators of CEX platforms come at the time when traded volumes on DEX applications are increasing courtesy of the rapidly growing Defi ecosystem. Underlining this growth is Uniswap’s monthly trade volume which exceeded that of Coinbase in September.
As data from the survey conducted by cryptocompare.com shows, CEX operators are conceding that volumes on DEXs are growing, but they suggest different reasons why this is happening. To begin with, the survey data shows that about 46.2% or 12 out of 26 of the responding operators “believe that the anonymity afforded by DEXs was the primary reason users traded on DEXs.” About 19.2% (5) believe the self-custody feature is the secondary driver of volumes on DEXs.
However, on the flip side, the respondents thought that “liquidity and fiat compatibility were the two main reasons why users preferred CEXs over DEXs.”
When asked about the possibility of DEXs usurping CEXs in the liquidity stakes, over 70% thought this will not happen anytime soon. The survey says:
Exchange operators felt their deeper liquidity would be an unassailable competitive advantage in the next 2 years. Over 70% of respondents thought it was unlikely or very unlikely DEX liquidity would surpass CEX liquidity in 2 years’ time.
Interestingly, the survey data shows that 40% of the respondents say “they are actively building or may build a DEX in the near future.”
With respect to the issue of user experience (UX), the respondents were less emphatic about the prospects of CEXs on this. According to the findings, just “57% of respondents believe it was unlikely or very unlikely that DEXs will have better UX in 2 years.” Only 11% of respondents thought that DEXs will have better UX than CEXs in 2 years’ time.
Meanwhile, the survey notes that as more digital asset exchanges are launched, “questions are being raised around the legitimacy of the volumes garnered by these upstarts.” Some analysts predict that there will be a decline of exchanges either through mergers and acquisitions or competition driving out weaker exchanges.
On this subject, cryptocompare.com shows that opinion is almost evenly divided as 42.3% of respondents expect to see an increase in this number next 2 years while 46.2% are expecting to see the number decline. On the question of fees, “there was more alignment with 65% of exchanges expecting to see trading fees decrease and only 11.5% expecting fees to increase.”
On the question of institutional investors entering the sector in the next two years, there was near unanimity as 92% of exchanges were optimistic that there will be a rise in
institutional investors entering the sector in that period.
What do you think will be the outcome of the rivalry between DEXs and CEXs in a year’s time? Share your thoughts in the comments section below.
Anonymity, Centralized Exchanges, cryptocompare.com, decentralized exchange, DeFi, DEXs, digital asset exchange, Liquidity, Mergers and acquisitions, Self-custody, uniswap, yield farming
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