Maitland/AMO Cryptocurrency Monitor – 10 October 2019

10th October 2019

The Big Read


Sharp rise in watchdog scrutiny of UK cryptocurrency groups

The Financial Times reports that the number of cryptocurrencies business that were scrutinised by the FCA last year jumped by 74%, as the Authority estimates that consumers have lost at least £27m in crypto and foreign-exchange scams. The FCA now has 87 inquiries on its books into crypto companies, compared to 50 from this time last year. David Heffron, partner at law firm Pinsent Masons, states that this represents the FCA’s increasingly hands-on and no-nonsense approach to enforcing the law within the industry.

For Non-Profits Working With Facebook, Libra Isn’t Such a Crazy Idea

Non-profit organisations are continually looking to participate in the Facebook-initiated Libra Association, with organisations such as Women’s World Banking and Mercy Corps hoping it will bring the global poor into the modern financial system. CoinDesk writes that several organisations have already seen the potential advantages of blockchain technology to better serve their target populations, with Libra receiving praise from multiple sources for letting NGOs sit at the project’s main table despite not having the financial ability to potentially purchase Libra coin.

Facebook Libra loses Paypal support in “huge blow” for cryptocurrency

PayPal has withdrawn its support for Facebook‘s Libra cryptocurrency, following continued regulatory scrutiny of the project. A spokesperson from the company commented: “[Paypal remain] supportive of Libra’s aspirations and look forward to continued dialogue on ways to work together in the future.” Following the withdrawal of support for the launch of Libra, other payment services companies have been noted for questioning their involvement in the association including Mastercard and Visa.

Cryptocurrency Donations to Politicians is Legal in Japan Says Internal Affairs Minister

Cryptocurrency donations to political parties received a thumbs up from Japan’s internal affairs and communications minister Sanae Takaichi at a press conference on Tuesday. The donations will not need to be disclosed under the Political Funds Control Law like cash or securities. CoinDesk reports that as crypto donations become more mainstream Japan’s political parties will have to address the taxonomy and rules. Japan’s cryptocurrency industry is still heavily regulated by the Financial Services Agency.


New Kid on the Block – The Technologies, Funds and ICOs you should know about


UNICEF launches cryptocurrency fund supported by Ethereum Foundation

UNICEF has launched a cryptocurrency fund to support open source technology “benefiting children and young people around the world”. CoinTelegraph reports that UNICEF has become the first U.N. organization “to hold and make transactions in cryptocurrency,” namely Bitcoin and Ether. Henrietta Fore, UNICEF executive director, commented: “if digital economies and currencies have the potential to shape the lives of coming generations, it is important that we explore the opportunities they offer.”

EU Finance Commissioner vows new rules on crypto, Libra stablecoin

Coindesk reports that Valdis Dombrovskis, the European Union’s financial services commissioner, has said he intends to create a new regulatory framework for cryptocurrencies, particularly Libra, despite the increased criticism it is receiving across the continent. Mr Dombrovskis issued a report which looks into the issue of regulation around crypto-assets, as part of a push by Dombrovskis to examine how the EU should allow or regulate crypto initiatives like Libra and whether new laws will be in need.


Scams, Sanctions and Suspicious Activity


Research: $160 Malware Botnet Tries to Steal Crypto From 72,000 Devices

Around 72,000 devices in 2019 alone were infected during a suspiciously cheap yet successful malware campaign to steal cryptocurrency. Cointelegraph reports that according to a research report published by cyber-intelligence company Prevailion, the MasterMana botnet used budget Russian malware that was likely to cost just $100, though the hackers were said to have also required a virtual public server at a cost of $60. A researcher commented: “we suspect that this particular threat actor is likely to continue operations, as previous public reporting has not deterred them.”

Former US Army Interpreter Gets 30 Years for Dark Web Fentanyl Trade

A former interpreter for the US military forces has been sentenced to 30 years in jail for dealing fentanyl on the dark web. Alaa Mohammed Allawi pleaded guilty to the drug charges and admitted accepting payments in cryptocurrencies for the drug. In 2017, Allawi’s drug exploits eventually led to the death of a Marine, who took one of his pills at a party while stationed at Camp Lejeune, North Carolina.

Former NiceHash CTO Arrested in Germany Over US Hacking Charges

The former CTO and co-founder of mining power marketplace NiceHasg has been arrested in Germany over US charges regarding a hacking organization responsible for the theft of millions of dollars. Matjaz Skorjanec is wanted in the U.S. for founding and running the cybercrime forum Darkode from 2008 to 2013, as well as for the creation and deployment of one of the largest botnets ever, Mariposa.


Bulls & Bears of the week


“It needs a chief executive for that business. The sooner a chief executive is appointed to lead it going forward that is not [from] Facebook, then people will understand the ambition of the entity itself.” – Nick Read, CEO of Vodafone, speaking about Libra

Bitcoin buyers should be ready to “lose all their money” – Andrew Bailey, head of the Financial Conduct Authority