This difficult year is coming to an end, and if that’s good news for some, it’s ended somewhat badly for others. The cryptocurrencyA digital currency running on a blockchain and built with cryptography. Contrary to central-bank issued currency, cryptocurrency issuance rules are... world has grown a lot this 2020, along with its regulatory controls worldwide. December, more than ever, has been a month to catch up with it. Let’s check!
The U.S. goes ahead with new crypto-laws
- The U.S. Congress introduced the new “Stablecoin Tethering and Bank Licensing Enforcement (STABLE) Act” for consideration. If approved the next year, the issuers of such coins would need to comply with more obligations within U.S. jurisdiction.
- The Financial Crimes Enforcement Network (FinCEN) has currently a 15-day comment period open (till Jan 4) for the proposal to identify every party involved in cryptocurrency transactions with “unhosted wallets”. This means wallets that aren’t controlled by any exchange or centralized institution, and are used directly on the blockchainBlockchain is a type of database storing an immutable set of data, verifiable to anyone with access to it —through....
- The star of the month: U.S. Securities and Exchange Commission (SEC) just revealed a lawsuit against Ripple Labs for allegedly having carried out a “$1.3 Billion Unregistered Securities Offering”, as they name the financial activities with Ripple and XRP since 2013. XRP price has plunged as a result.
About hacks and security…
- Some hackers designed a massive bunch of fake LedgerA ledger is like a spreadsheet keeping track of which addresses own how many bitcoins. The Bitcoin blockchain is a... emails (the crypto hardware walletA crypto wallet is a user-friendly software or hardware used to manage private keys. There are software wallets for desktop...) and are sending them to the customers. Their main goal is deceiving the most people as possible to steal their private keys and passwords, and, therefore, the cryptocurrencies they may have in this wallet.
- Hugh Karp, the founder of DeFi insurance protocol Nexus Mutual, experienced an $8M hack this month. The hackers tricked him to approve a spoof transactionA cryptocurrency transaction is an entry on the blockchain ledger, noting sender, receiver and number of coins transacted. of 370,000 NXM (Nexus Mutual) tokens. Luckily, the users of such protocol weren’t affected.
- The DeFi lending protocol Warp Finance was hacked for around $8 million in a flash loan attack. The bright side is their security team was able to recover $5.85M from such funds, and they’ll issue some additional IOU tokens for the affected users.
A 2020 summary in crypto
- According to the World Bank, the University of Cambridge, and World Economic Forum, the Fintech industry (in which we can include cryptos and blockchains) grew a lot during the COVID-19 pandemic, helping to financially include the most vulnerable people.
- The total cryptocurrency market capitalization increased by around 229% Year-To-Date (YTD), compared to barely +50% in 2019. BitcoinBitcoin is the first decentralized digital currency. It was created in 2009, by an anonymous founder or group of founders... More reached a new All-Time-High (ATH) and the DeFi ecosystem is booming, with around $14B locked for investments.
- Exchanges, investors, and people, in general, contributed to cryptocurrency campaigns to fight COVID-19. Examples of them are #CryptoCOVID19 (The Giving Block), COVID-19 Emergency Relief Fund (BitGive), and #StopCovid_IO (ComGo).
- As indicated by CipherTrace, around $1.4B in cryptocurrencies were stolen in 2020. The exchanges and platforms Poloniex, IOTA, Altsbit, Lendf.me, Bisq, Coincheck, 2together, KuCoin, Eterbase, Harvest Finance, Akropolis, and Pickle Finance were hacked throughout the year [ZDNet].
- This was the year of the greatest Twitter hack/scam involving Bitcoin. Around 130 verified accounts were attacked, among which were names like Bill Gates, Barack Obama, Joe Biden, Elon Musk, Jeff Bezos, Uber, Apple, and Ripple. The hacker posted from there the classic giveaway scam with BTCAn abbreviation for Bitcoin..
- PayPal, Square, MicroStrategy, Ruffer, and other institutional investors jumped into Bitcoin this year. That’s been great news for its capitalization, price, and stability.
- Russia, the United Kingdom, the European Union, and the United States are already preparing their own legal measures for cryptocurrencies. And all of them have to do something with taxes and limits for retail investors.
- While Bitcoin Cash (BCH) undertook a new hardfork with few consequences, Bitcoin (BTC) implemented the protocols Taproot and Schnorr to improve its privacy, smart contracts, and scalability.
- Ethereum 2.0 started its existence as a Proof-of-Stake (PoS) cryptocurrency. The genesis blockA collection of cryptocurrency transactions. Every few minutes (or seconds, depending on the blockchain) one miner or validator verifies the... of its Beacon Chain was successfully mined in early December. The rest will come between 2021 and 2030.
And there’s a lot more to come. We certainly believe 2021 will be a nice year for the cryptocurrency world.
Featured Image by pasja1000 / Pixabay
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