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WASHINGTON — Suspected ransomware payments totaling $590 million were made in the first six months of this year, more than the $416 million reported for all of 2020, U.S. authorities said on Friday, as Washington put the cryptocurrency industry on alert about its role in combating ransomware attacks.
The U.S. Treasury Department said the average amount of reported ransomware transactions per month in 2021 was $102.3 million, with REvil/Sodinokibi, Conti, DarkSide, Avaddon, and Phobos the most prevalent ransomware strains reported.
President Joe Biden has made the government's cybersecurity response a top priority for the most senior levels of his administration following a series of attacks this year that threatened to destabilize U.S. energy and food supplies.
Avoiding U.S. sanctions
Seeking to stop the use of cryptocurrencies in the payment of ransomware demands, Treasury told members of the crypto community they are responsible for making sure they do not directly or indirectly help facilitate deals prohibited by U.S. sanctions.
Its new guidance said the industry plays an increasingly critical role in preventing those blacklisted from exploiting cryptocurrencies to evade sanctions.
The new guidance also advised cryptocurrency exchanges to use geolocation tools to block access from countries under U.S. sanctions. Image source: Photo by Jeremy Bezanger on Unsplash
"Treasury is helping to stop ransomware attacks by making it difficult for criminals to profit from their crimes, but we need partners in the private sector to help prevent this illicit activity," Deputy Treasury Secretary Wally Adeyemo said in a statement.
The new guidance also advised cryptocurrency exchanges to use geolocation tools to block access from countries under U.S. sanctions.
Hackers use ransomware to take down systems that control everything from hospital billing to manufacturing. They stop only after receiving hefty payments, typically in cryptocurrency.
Large scale hacks
This year, gangs have hit numerous U.S. companies in large scale hacks. One such attack on pipeline operator Colonial Pipeline led to temporary fuel supply shortages on the U.S. East Coast. Hackers also targeted an Iowa-based agricultural company, sparking fears of disruptions to grain harvesting in the Midwest.
The Biden administration last month unveiled sanctions against cryptocurrency exchange Suex OTC, S.R.O. over its alleged role in enabling illegal payments from ransomware attacks, officials said, in the Treasury's first such move against a cryptocurrency exchange over ransomware activity. (VOA/RN)
Keywords: Cryptocurrency, United States, Hacking, Ransomware
SAN FRANCISCO — Since China's government declared all cryptocurrency transactions illegal last week and banned citizens from working for crypto-related companies, the price of bitcoin went up despite being shut out of one of its biggest markets.
Experts say large-scale Chinese miners of cryptocurrency — the likes of Bitcoin and Ethereum — will take their high-powered, electricity-guzzling servers offshore. Exchanges of the digital money and the numerous Chinese startups linked to the trade also are expected to rebase offshore after dropping domestic customers from their rosters.
The shift highlights how virtual currencies can evade government regulation.
"The exchanges have been pushing offshore anyways, and with the exchange business you need cloud infrastructure, you need developers, you need management to move things in the right direction, and so whether that is sitting in Taipei, San Francisco, Singapore or Shanghai, it doesn't really matter — those businesses are very virtual," said Zennon Kapron, Singapore-based founder the financial consulting firm Kapronasia.
"The real impact we've probably seen though is in the miners, and most of those miners [are in] the process of shifting overseas or [have] already completed moving overseas," he said.
Strongest anti-crypto action to date
On Sept. 24, the People's Bank of China, Beijing's monetary authority, released a statement saying cryptocurrencies lack the status of other monetary instruments. The notice, issued in tandem with nine other government agencies, including the Bureau of Public Security, declared all related business illegal and warned that cryptocurrency transactions originating outside China will also be treated as crimes.
Explaining the ban, China's official Xinhua News Agency reported Friday that cryptocurrencies have disrupted the controlled economy's financial systems and contributed to crimes such as money laundering.
Cryptocurrencies — digital commerce tools that aren't linked to a centralized banking authority — first appeared in China around 2008. Chinese banks began to prohibit the use of digital currencies in 2013 and stepped up regulations after 2016.
China was the world's biggest Bitcoin miner and supported the largest exchange by volume, according to the news website CryptoVantage. It says many of those who suddenly made millions when Bitcoin prices soared four years ago were in China.
Mining for digital currency — the process of using computers to enter bitcoins into circulation and verify cryptocurrency transactions in exchange for a payout — should get easier overseas as Chinese exit the market, Kapron said. | Photo by Sajad Nori on Unsplash
Chinese miners and traders head to Singapore
The Chinese ban carries penalties for international exchanges that do business with people inside China, and news reports indicate international crypto exchanges are trying to cut ties with Chinese clients in recent days. But the companies themselves are largely staying quiet.
A spokesperson for digital currency exchange Coinbase said Wednesday it does not "have anything to share at this time" about the crackdown in China. U.S.-based Worldcoin Global, a new type of cryptocurrency, did not reply to a request for comment.
China's growing pressure on crypto over the past few years had prompted stakeholders to leave the country, Kapron said, adding that less than a quarter of the country's original cryptocurrency peer-to-peer lending startups — small firms that connect individual lenders and borrowers — remain in China.
Mining for digital currency — the process of using computers to enter bitcoins into circulation and verify cryptocurrency transactions in exchange for a payout — should get easier overseas as Chinese exit the market, Kapron said.
Smaller operators, he added, may be able to mine more easily without the competition of giant Chinese operations.
Singapore looms as a prime go-to place for operations that need not be physically onshore. The country had accepted about 300 cryptocurrency license applications as of July. From China, e-commerce giant Alibaba as well as digital financial firms Yillion Group and Hande Group have applied, news reports in Asia say.
Other Asian countries lack the legal welcome mat that Singapore has extended, said Jason Hsu, vice president of the Taiwan Fintech Association industry group.
"Where would that money flow to? I think it's a question that needs to be answered," Hsu said. "I think in Asia, Singapore would be a destination for them to go to. Singapore obviously has the clearest regulations and also wants to attract more digital fintech [financial-technology] companies."
Outside Asia, Amsterdam and Frankfurt are "establishing their footprint as international centers" for financial technology, said Rajiv Biswas, Asia Pacific chief economist with market research firm IHS Markit. Financial technology covers cryptocurrency.
Western Europe ranked this year as the world's biggest crypto economy in the world with inflows of more than $1 trillion or 25% of all global trade, activity, news and data service Chainalysis says. Europe's surge follows similarly rapid growth in 2020.
Eventual resurgence for crypto in China?
Authorities in China are targeting crypto now as part of a wider "crackdown on overnight riches" and to "clean out the wild, wild West," Hsu said, referring to largely unregulated market sectors. The trade will go underground for now, he forecasts, and China will eventually come out with an official digital currency issued through major banks.
Several countries are considering adopting new digital currencies that would allow people to exchange money without an intermediary, such as a bank. Proponents argue these currencies could capture the benefits of cryptocurrencies that make exchanging money easy, but without the price volatility of decentralized digital assets like bitcoin.
Chinese authorities may eventually swing to a more tolerant view of non-state-sanctioned digital currencies, though subject to strict criteria on what's legal or otherwise, said Song Seng Wun, economist in the private banking unit of Malaysian bank CIMB. Blockchain, the core technology behind the public transaction ledger that makes crypto commerce transparent, could continue to develop in China for other ends, he added.
(This article is originally written by Ralph Jennings) (VOA/RN)
Keywords: Cryptocurrency, Bitcoin, China, Market, Ban
A cryptocurrency is a digital/virtual currency, that is secured by cryptography (study of hiding information). There are over 6,500 cryptocurrencies in existence as of September 2021. The value of cryptocurrency is growing at a quick rate and analysts and experts are still expecting a sharp rise in the value of Bitcoin, the oldest, and most valuable cryptocurrency in the world. however, china doesn't seem to be on board with the idea of digital coins in its economy as it has banned dealing and trading in these digital tokens.
China has taken several decisions to curb the rise of cryptocurrency in its market since 2013 by putting in place increasingly stricter rules on virtual currencies. But on September 17th, China's central People's Bank of China (PBOC) announced that all activities from transactions made in cryptocurrency to crypto mining are deemed illegal including offering trading of digital assets, order matching, token issuance and derivatives. Anyone who's found guilty of being involved with cryptocurrencies and working for overseas platforms from within China will be severely punished. Chinese Government directed the banks to not provide any products or services such as trading, clearing and settlement for cryptocurrency transactions.
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The price of several cryptocurrencies like Bitcoin, Ethereum, Dogecoin etc. fell drastically after China's announcement. Bitcoin fell below $30,000 for the first time in more than five months nevertheless it recovered some ground by reaching $38,131, though it was still down -10.4%. Ether under Ethereum blockchain lost as much as 22% and Dogecoin lost up to 24%. Two of the largest bitcoin exchange companies Huibo and Binance have halted new registrations for new Chinese registrations and are planning to retire current accounts adhering to the country's new policies. Huibo announced that it'll close down all existing Chinese accounts by the end of the year. The ban makes buying or selling the assets difficult for Chinese mainland investors, as they cannot do so unless they leave the country. The ban has had a major negative impact on the gaming and tech sector.
ALSO READ: The Great Indian Crypto Circus
China was once the world's biggest bitcoin trading and mining centre in 2017. But in May 2021 China's State Council vowed to ban virtual coin transactions and mining. Several Chinese crypto companies are moving out of the country so that the impact of the ban would relatively limited. But why did China went as far as banning cryptocurrency? While the reasons behind China's ban on cryptocurrency remains vague. Speculations are that crypto trading had rebounded and was threatening to the safety of people's assets and disrupting the normal economic and financial order, that it is to prevent money laundering. A report by CryptDailyUse explained that the decision was made in favour of reducing energy prices, greenhouse fuel emissions and carbon footprints concerned with cryptocurrency transactions. China's ban will put China's internet security to test as to whether they're able to find and punish people and platforms that are breaking the laws. Some analysts have claimed that determined investors will find one or the other way to make trades in crypto or they'll simply move off-shore to perform transactions.
Bitcoin has become an essential crypto asset in modern portfolios and investment funds. The confidence generated in this cryptocurrency will depend a lot on the diversification that companies make in their balance sheets in Bitcoin and the increase of institutional investors that allocate a percentage of their funds in this crypto. American fund manager Cathie Wood makes some interesting predictions, both in the rise that the Bitcoin price will experience in the next 5 years, suggesting these institutional investors allocate 5% of their funds; this will help leverage the Bitcoin market.
Bitcoin will grow by a tenfold
Bitcoin is projected to grow by 10 times its current value in five years, i.e., it could reach $500,000. Of course, this will require companies to invest in cryptocurrencies. This makes it necessary to increase the weight of Bitcoin on balance sheets through investments. One of the investment gurus who supports this prediction is Catherine Wood. Contrarily, Ray Dalio, despite being clear that relying on cash is not a good strategy, views Bitcoin with suspicion, although he calls for its investment. This behavior is due to the actions of governments against the cryptocurrency market.
If something is undoubted is the vertiginous increase that cryptocurrencies have had in general, they have risen more than 60% so far this year. So, even when some governments are trying to regulate cryptocurrencies, they will fail. This attempt to regulate will end up triggering even more cryptos, especially Bitcoin, which is the oldest and most solid of that market.
Bitcoin, is the oldest and most solid of the market. | Photo by Executium on Unsplash
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The current Bitcoin price means is time to buy:
The current price of bitcoin invites you to buy, and perhaps it would be foolhardy not to. In either case, bitcoin will always represent money. Maybe some external factors generate some misgivings, but if you refuse to invest in cryptocurrencies, you are basically denying the near future, it would be as if you didn't have a cell phone or internet.
In India, more and more people are becoming convinced of the benefits of holding some Bitcoin. This can be clearly seen in the rapid increase in the number of new accounts at crypto exchanges such as WazirX and CoinDCX.
ALSO READ: How can you trade in Bitcoin in India?
Bitcoin, despite its fluctuations, represents an excellent financial strategy. The support users give is significant. The same cannot be said of the FIAT currencies, which have lost value and support, showing how fragile they are, being subjected to a constant devaluation. As long as confidence in cryptos grows, the foundations will continue to be laid to maintain their rise and to be able to continue making transactions. We know this by previous experience, as has happened with Ether, thanks mainly to the growing activity of Defi and NFT, i.e. decentralized finance and non-fungible tokens.
Remember that when you invest in Bitcoin, you can do it by buying or trading. When you want to make these transactions do it in a secure Exchange, study your finances to invest, manage the risk, and learn to manage your portfolio efficiently.