Coinbase gives up data to New York attorney general

Coinbase gives up data to New York attorney general

New York’s Attorney General (AG) Eric Schneiderman asked a number of cryptocurrency exchanges to turn over corporate data last month. While some exchanges like Kraken told him to basically get stuffed, Coinbase has agreed to the request.

In a public response to the request, and perhaps as a means of saving face, Coinbase said, “We applaud the [Office of the Attorney General] for taking action to bring further transparency to the virtual currency markets.” The response is part of a five-page letter penned by the exchange’s chief legal and risk officer, Mike Lempres, who further detailed the $150 billion in assets held by the company, as well as its received funding of $225 million and its financial position, which he describes as “a profitable and self-sustaining business.”

Schneiderman, who has never been an ally to the cryptocurrency industry, sent a request to 13 exchanges in April that demanded information on 32 separate points. He solicited information about their operations, their leadership, privacy, funding and relationships with other financial institutions, and much more. As any power-branding zealot would do, he only gave the exchanges two weeks to comply.

Coinbase’s letter further details its involvement with law enforcement and regulatory agencies around the world, its system upgrades (which, according to Lempres, helped the platform maintain 99.99% uptime in April) and Coinbase’s “state of the art” cybersecurity program. Lepres also stated that the company is a federally-regulated money service and currently holds licenses to operate in 31 states, including in New York with its BitLicense.

Coinbase may have reported “99.99% uptime” for April, but it wasn’t without issues in the month. From April 12 to April 16, users reported not receiving email confirmations for instant purchases, a glitch that Coinbase subsequently corrected. On April 2, purchases using the exchange’s Xfers payment method were unavailable for about four hours, but no sells were apparently affected.

The public version of the information provided is a watered-down version of what was presented to Schneiderman per a request by Lempres made from the start. Lempres had requested “confidential treatment” to the entire response, delivered to the AG via Coinbase’s own “encrypted end-to-end secure file exchange service consistent with our security protocol.”

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
Kraken responds to New York crypto exchange crackdown

Kraken responds to New York crypto exchange crackdown

This week, New York Attorney General (AG) Eric Schneiderman announced that his office is opening an inquiry into cryptocurrency exchange operations. Several exchanges, including Gemini, Binance, bitFlyer, Bittrex and Kraken are targets of Schneiderman’s wrath, with the inquiries being focused more on the companies’ business practices and systems. Kraken’s co-founder, Jesse Powell, took to Twitter to give his take on the situation, calling the investigation “insulting.”

Powell started by saying, “Somebody has to say what everybody’s actually thinking about the NYAG’s inquiry. The placative kowtowing toward this kind of abuse sends the message that it’s ok.” He went on to point out that it is obvious that regulators are clueless when it comes to discerning what businesses want, as well as what consumers want.

Kraken wisely exited the state in 2015. Many in the cryptocurrency industry, including Powell, feel that New York is hostile to digital currency. Their estimation of the crypto atmosphere in the state has a solid foundation, as the exchanges have been presented with a 34-page demand by AG Schneiderman that has to be completed and returned within two weeks.

Everything was running relatively smoothly in New York pre-2015. However, that year, lawmakers approved a series of regulations called BitLicense, and more than 10 exchanges called it quits, removing their operations from the state. To date, only three BitLicenses have been awarded, going to Ripple, Coinbase and Circle. Other applicants have applied, but they were all rejected.

Schneiderman initiated the inquiry in conjunction with his Virtual Markets Integrity Initiative. While it may seem like a solid effort to protect consumers, it would be highly prudent to ask who will be reviewing the information submitted by the exchanges, if they choose to buckle. What experts in the fields of cryptocurrencies and finances have been sought out to analyze the data? Nothing in his résumé indicates that he has formal training in either category.

It’s a safe bet that Kraken doesn’t intend to respond to the inquiry, and others may follow suit. What ramifications will follow remain to be seen, but it’s important that business leaders stick to their guns when facing illegitimate attacks. Powell made a good suggestion in his Twitter rebuttal, stating that perhaps the markets themselves should decide what’s important to consumers.

Powell signed the tweet with a succinct, yet poignant, “Good luck, New Yorkers.”

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
New York's AG opens inquiry into cryptocurrency exchanges

New York’s AG opens inquiry into cryptocurrency exchanges

Regulators in the state of New York have announced an inquiry into several leading cryptocurrency exchanges, with as many as 13 separate operations coming in for closer scrutiny.

The inquiry has been instigated by the Attorney General Eric Schneiderman, as part of the state’s new ‘Virtual Markets Integrity Initiative,’ with the initial enquiry described as “a fact-finding inquiry into the policies and practices.”

According to a press release issued by the New York Attorney General’s Office this week, initial letters were sent to over a dozen exchanges, requesting information about their business practices and systems—including whether they currently use bots, or whether they have any conflicts of interest.

Schneiderman described the move as part of a drive to help consumers gleam the ‘basic facts’, vis a vis transparency and accountability in their investments.

“With cryptocurrency on the rise, consumers in New York and across the country have a right to transparency and accountability when they invest their money. Yet too often, consumers don’t have the basic facts they need to assess the fairness, integrity, and security of these trading platforms,” he said.

The exchanges targeted reads like an industry who’s who, covering the majority of major operators in the sector. The full list has seen bitFlyer, Binance, GDAX, Gemini, itBit, Huobi.Pro, Bitfinex, Poloniex Bitstamp, Bittrex, Gate.io, Tidex and Kraken all targeted with initial requests for information.

Suggesting the move was about focusing on ‘key issues’ affecting consumer investors, Schneiderman’s office said that it was preparing to extend its focus to exchanges that specifically choose not to operate within New York, on account of its current regulatory regime.

“We are aware that certain trading platforms have formal rules barring access in New York and may not have a license to engage in virtual currency business activity in New York. Among other topics, we are asking platforms to describe their measures for restricting trading from prohibited jurisdictions,” the attorney general’s office stated.

The news comes at a time of increasing scrutiny for cryptocurrency exchanges, with regulators worldwide turning their focus to exchanges, as well as developing local systems for regulating cryptocurrency businesses.

Note: Tokens in the SegWit chain are referred to as SegWit-Coin BTC (inaccurately called Bitcoin Legacy or Core by many) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
New York wants cryptocurrency miners to pay premium rates for electricity

New York wants cryptocurrency miners to pay premium rates for electricity

New York doesn’t seem to be getting along with cryptocurrency companies until now.

The New York Power Authority has slapped cryptocurrency miners with a decision stating that such activities will now be charged premium rates for electricity. The move would protect other electricity consumers from fluctuations in electricity costs, which is a likely possibility should cryptocurrency miners set up shop in the city and consume huge amounts of power, spiking up demand for energy supply and with it, kilowatt hour prices.

“If we hadn’t acted, existing residential and commercial customers in upstate communities served by a municipal power authority would see sharp increases in their utility bills,” commission chair John Rhodes said.

This is additional bad news, especially for companies who have just finally reconciled with the fact that they have to acquire a Bitlicense to operate in New York. One company in many people’s minds is CoinMint, which only recently was able to secure the approval of lawmakers to set up a cryptocurrency mining farm in a decommissioned smelter in the town of Massena after promising 150 jobs to residents of the state. It’s now in question what their next move will be given the new decision, which will make their original plan more expensive and therefore less profitable.

In June 2015, the New York Department of Financial Services (DFS) handed down the Bitlicense regulation, which requires that anyone—companies or individuals—engaging in cryptocurrency-related activities such as mining would have to apply for the license. But instead of compliance, this forced companies like Bitfinex and Shapeshift out of the state, with more protesting and saying that the heavy-handed regulation has created circumstances that may force them out as well. Companies argue that the requirements are quite costly, and that the standards were much higher than those imposed on traditional financial institutions.

“We don’t transmit or exchange real digital currencies for our customers,” he remarked. “Kadena is a tech startup company. We’re not a financial institution. We don’t do [anything with money]. Because of the BitLicense, we might leave New York,” says Will Martino, a co-founder of distributed ledger startup Kadena.

Last month, lawmakers said they were open to revisiting the regulation, after it has become apparent that businesses do not support it, with very few applying for the license to date.

“We want to put that out there, circulate it and really figure out how we can make this license in New York state something that works for the residents of New York state and the state economy,” State Senator David Carlucci told CoinDesk. “We’re going to do this again in a month, month and a half from now,” Hamilton said.

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
New Yorker's crypto mining rig draws FCC's ire

New Yorker’s crypto mining rig draws FCC’s ire

The Federal Communications Commission (FCC) issued a “Notification of Harmful Interference” to New York City resident Victor Rosario, citing a complaint filed by T-Mobile which pointed to Rosario’s miner as the culprit for an interference in the network’s 700MHz LTE band.

The notice, according to FCC, was in response to T-Mobile’s report of radio emissions coming from a local residence in Brooklyn which interfered with its LTE network. Initial investigations in the vicinity, which made use of “direction finding techniques,” determined that Rosario’s legacy Bitcoin (BTC) mining operation was the cause of the reported interference.

The cryptocurrency mining operation used several units of the Antminer S5, which generated “spurious emissions on frequencies assigned to T-Mobile’s broadband network,” thereby causing “harmful interference,” according to the FCC’s findings.

The FCC warned the crypto mining operator that if he continues to use the specified device, the interference which it causes to T-Mobile’s network can be used as evidence to file a case placing the operator in violation of federal laws. This, according to the commission, could result in Rosario facing “severe penalties, including, but not limited to, substantial monetary fines, in rem arrest action to seize the offending radio equipment, and criminal sanctions including imprisonment.”

The FCC’s rulebook mandates anyone within its jurisdiction operating radio frequency devices to immediately cease use of a device found to be interfering with critical network infrastructures.

While the FCC has stated that “operation shall not resume until the condition causing the harmful interference has been corrected,” the issue is still under further investigation. The FCC is working to identify if the interference was an isolated case or if devices with similar configurations to the Antminer S5 are likely to also cause interference with 700MHz LTE frequencies.

Manufactured by Bitmain, the Antminer S5 was first released for international shipping in late 2015. It featured the then-flagship BM1384 ASIC chip which at the time was 20% more efficient than the previous Antminer model (S3).

At the time of writing, findings remain inconclusive as to why the Antminer S5 was emitting 700MHz radio frequencies. Hardware flaws or device modifications initiated by a mining hobbyist may cause unintentional emissions.

In a footnote to the notice sent to Rosario, the FCC clarified that the issue was only limited to the operator’s device, “not its brand or model and is not meant to suggest or find that all Antminer S5 devices are noncompliant,” adding that “although [they] are aware that even compliant devices can be modified in a manner that creates harmful interference, [they] make no finding as to whether this particular device conforms to its original manufacturer’s specifications.”

A tweet by FCC Commissioner Jessica Rosenworcel observed that the letter sent to Rosario “seems so very 2018” given its mention of cryptocurrency mining, computing power, and blockchain computation. In the cryptocurrency community, mining enthusiasts sometimes “overclock” their GPUs and ASIC mining rigs to make more competitive gains for their operation.

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.

Japan’s Bitflyer secures regulatory nod to operate in New York

BitFlyer, Japan’s largest cryptocurrency exchange by trading volume, has cleared another hurdle in its bid to set foot on U.S. soil.

The Tokyo-based exchange announced on Tuesday that it has been approved by the New York State Department of Financial Services (NYDFS) to operate in the state as a virtual currency exchange. BitFlyer is the fourth exchange to be granted New York’s elusive “BitLicense,” along with Coinbase, Circle and Ripple.

In an interview with CoinGeek, BitFlyer U.S. COO Bartek Ringwelski said a BitLicense is “incredibly important” for cryptocurrency companies like them that are planning to enter the U.S. market.

“New York is a doorway through which institutional funds will enter the market. We are glad the NYDFS granted us the license,” said Ringwelski.

BitFlyer accounts for more than 80 percent of global BTC-JPY trading volume, according to CryptoCompare data. Founded in 2014,BitFlyer raised an estimated $27 million in a Series C funding round last year. The company said it has facilitated over $40 billion in bitcoin trades, $30 billion of which came in 2017 year-to-date alone.

Following its success in the Japanese market, BitFlyer announced several months ago that it has started preparing to enter United States. The announcement comes at a time when the country’s complicated regulatory framework has resulted in several exchanges to pull out their services in some states.

BitFlyer said it in August that has already been approved to operate in 34 states. That number has since expanded to 42 states after the company secured the “nod of approval from one of the most influential state financial services regulators in the nation,” said CEO Yuzo Kano.

The company plans to bring “deep expertise and proprietary technology to the U.S. market,” with particular interest on the “currently untapped” institutional investors in the United States.

For starters, BitFlyer rolled out a U.S.-based virtual currency exchange platform, which is designed for professional traders who trade US$100,000 or more in cryptocurrency monthly. The BitFlyer platform features “a powerful API for programmatic traders,” allowing investors to place market, limit and complex trade orders.

“Our expansion and upcoming cross-border trading addresses a huge unmet need in the U.S. by institutional traders looking to access large amounts of liquidity across multiple virtual currency markets,” Ringwelski said in a statement. “Through our web interface or API, approved professional traders can be up and running and making trades in a matter of minutes.”

BitFlyer is offering zero percent trading fees in the United States until the end of 2017. The U.S. exchange platform currently supports BTC, but the company said it will expand its offerings to include Bitcoin Cash (BCH), Ethereum, Ethereum Classic, and Litecoin, among others.

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.

Japan’s Bitflyer secures regulatory nod to operate in New York

BitFlyer, Japan’s largest cryptocurrency exchange by trading volume, has cleared another hurdle in its bid to set foot on U.S. soil.

The Tokyo-based exchange announced on Tuesday that it has been approved by the New York State Department of Financial Services (NYDFS) to operate in the state as a virtual currency exchange. BitFlyer is the fourth exchange to be granted New York’s elusive “BitLicense,” along with Coinbase, Circle and Ripple.

In an interview with CoinGeek, BitFlyer U.S. COO Bartek Ringwelski said a BitLicense is “incredibly important” for cryptocurrency companies like them that are planning to enter the U.S. market.

“New York is a doorway through which institutional funds will enter the market. We are glad the NYDFS granted us the license,” said Ringwelski.

BitFlyer accounts for more than 80 percent of global BTC-JPY trading volume, according to CryptoCompare data. Founded in 2014,BitFlyer raised an estimated $27 million in a Series C funding round last year. The company said it has facilitated over $40 billion in bitcoin trades, $30 billion of which came in 2017 year-to-date alone.

Following its success in the Japanese market, BitFlyer announced several months ago that it has started preparing to enter United States. The announcement comes at a time when the country’s complicated regulatory framework has resulted in several exchanges to pull out their services in some states.

BitFlyer said it in August that has already been approved to operate in 34 states. That number has since expanded to 42 states after the company secured the “nod of approval from one of the most influential state financial services regulators in the nation,” said CEO Yuzo Kano.

The company plans to bring “deep expertise and proprietary technology to the U.S. market,” with particular interest on the “currently untapped” institutional investors in the United States.

For starters, BitFlyer rolled out a U.S.-based virtual currency exchange platform, which is designed for professional traders who trade US$100,000 or more in cryptocurrency monthly. The BitFlyer platform features “a powerful API for programmatic traders,” allowing investors to place market, limit and complex trade orders.

“Our expansion and upcoming cross-border trading addresses a huge unmet need in the U.S. by institutional traders looking to access large amounts of liquidity across multiple virtual currency markets,” Ringwelski said in a statement. “Through our web interface or API, approved professional traders can be up and running and making trades in a matter of minutes.”

BitFlyer is offering zero percent trading fees in the United States until the end of 2017. The U.S. exchange platform currently supports BTC, but the company said it will expand its offerings to include Bitcoin Cash (BCH), Ethereum, Ethereum Classic, and Litecoin, among others.

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.

Japan’s Bitflyer secures regulatory nod to operate in New York

BitFlyer, Japan’s largest cryptocurrency exchange by trading volume, has cleared another hurdle in its bid to set foot on U.S. soil.

The Tokyo-based exchange announced on Tuesday that it has been approved by the New York State Department of Financial Services (NYDFS) to operate in the state as a virtual currency exchange. BitFlyer is the fourth exchange to be granted New York’s elusive “BitLicense,” along with Coinbase, Circle and Ripple.

In an interview with CoinGeek, BitFlyer U.S. COO Bartek Ringwelski said a BitLicense is “incredibly important” for cryptocurrency companies like them that are planning to enter the U.S. market.

“New York is a doorway through which institutional funds will enter the market. We are glad the NYDFS granted us the license,” said Ringwelski.

BitFlyer accounts for more than 80 percent of global BTC-JPY trading volume, according to CryptoCompare data. Founded in 2014,BitFlyer raised an estimated $27 million in a Series C funding round last year. The company said it has facilitated over $40 billion in bitcoin trades, $30 billion of which came in 2017 year-to-date alone.

Following its success in the Japanese market, BitFlyer announced several months ago that it has started preparing to enter United States. The announcement comes at a time when the country’s complicated regulatory framework has resulted in several exchanges to pull out their services in some states.

BitFlyer said it in August that has already been approved to operate in 34 states. That number has since expanded to 42 states after the company secured the “nod of approval from one of the most influential state financial services regulators in the nation,” said CEO Yuzo Kano.

The company plans to bring “deep expertise and proprietary technology to the U.S. market,” with particular interest on the “currently untapped” institutional investors in the United States.

For starters, BitFlyer rolled out a U.S.-based virtual currency exchange platform, which is designed for professional traders who trade US$100,000 or more in cryptocurrency monthly. The BitFlyer platform features “a powerful API for programmatic traders,” allowing investors to place market, limit and complex trade orders.

“Our expansion and upcoming cross-border trading addresses a huge unmet need in the U.S. by institutional traders looking to access large amounts of liquidity across multiple virtual currency markets,” Ringwelski said in a statement. “Through our web interface or API, approved professional traders can be up and running and making trades in a matter of minutes.”

BitFlyer is offering zero percent trading fees in the United States until the end of 2017. The U.S. exchange platform currently supports BTC, but the company said it will expand its offerings to include Bitcoin Cash (BCH), Ethereum, Ethereum Classic, and Litecoin, among others.

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.