Biggest Crypto Hedge Funds and What They Tell About the Market

Biggest Crypto Hedge Funds and What They Tell About the Market

Who are the biggest hedge funds operating in crypto today and how much do they have invested in crypto and blockchain firm

Biggest Crypto Hedge Funds and What They Tell About the Market

The total market cap for all cryptocurrencies stands at $293 billion, and while much of this value has been generated by individual traders buying and selling their own private stashes of crypto,

it's also largely the result of big investment funds. These are companies that have crypto assets under management worth as much as $1 billion or upward, with most of them qualifying as the whales the cryptocurrency community often talks about after every market movement. Yet, aside from simply trading Bitcoin, Ether or many other cryptocurrencies, funds also often invest venture capital (VC) in blockchain — and crypto-related startups. This makes them doubly important for the growth of the cryptocurrency industry, given that they support not only the currencies of the future, but also the platforms and companies that will harness these currencies to build entirely new financial ecosystems. That said, most of funds have been backed by traditional venture capital, such as Andreessen Horowitz and Sequoia Capital. So, even though they are supporting the emergence of the new crypto economy, it will be one that will have strong, foundational links with the financial system — something many in the community think crypto will replace.

The top five

Obtaining reliable, standardized data on the assets under management of each major crypto fund is very difficult, if not impossible. Accordingly, this top five doesn't claim to be completely authoritative, given that it gleans available data from a variety of sources published at a variety of times. Nonetheless, it provides a fairly robust account of the five firms that are most likely the biggest funds operating in crypto today, in terms of digital assets under management and investments in crypto-related startups.

Digital Currency Group/Grayscale Investments

Digital Currency Group was founded in 2015 by Barry Silbert, who had previously invested in such early cryptocurrency companies as Coinbase, Ripple and BitPay. It already has invested in nearly 130 crypto-related projects, with the average size of seed rounds it was involved in between 2016 and 2018 being $3.24 million. Given that it has more investments than pretty much every other fund in the industry, it will be no surprise to hear that it has backed some of the most well-known crypto projects and companies, including Circle, Chainalysis, Blockchain, Shapeshift, Parity, Ledger, Luno, Kraken, Korbit and eToro.

One of its investments is Grayscale, a subsidiary of Digital Currency Group that invests directly in cryptocurrencies and digital assets. Grayscale announced in its Q2 2019 financial report that it had assets under management (AUM) worth $2.7 billion. As an indication of just how volatile the AUM figure can be, it also revealed that this number had tripled since the first quarter of 2019, with its dedicated Bitcoin Trust having increased 300% compared to the same time last year. More revealingly, Grayscale's latest report also detailed how most demand for crypto investment comes from institutional investors — who have represented 84% of its client base since July 2018. As such, it's clear that, far from being a grassroots-based, decentralized ecosystem, crypto is already driven very much by big business and big money.

Polychain Capital

Founded in 2016 by cryptocurrency investor Olaf Carlson-Wee, Polychain Capital is another crypto-focused hedge fund that nonetheless has backing from noncrypto venture capitalists. Back at the end of 2014, it was reported that its AUM totalled $591.5 million, having plunged from a high at the end of 2017 of around $1 billion. However, data from Crypto Fund Research states that, as of June 2019, it has $967 million of cryptocurrency under management. As with most other major funds, it also invests in blockchain- and crypto-related startups, with its tally of investments coming to 37 (according to Crunchbase). These include Coinbase, Kik, Celo and dYdX, which Polychain has been able to invest in thanks largely to the raising of around $175 million for its venture capital fund at the end of 2018. One thing that's worth noting about Polychain Capital is that it has received significant backing for its venture capital and crypto funds from major VC firms. In 2017, it closed a $200 million funding round in which Sequoia Capital, Andreessen Horowitz and Union Square Ventures all participated. It is, therefore, as much a product of traditional finance as it is of the new cryptocurrency ecosystem.

Pantera Capital

Initially founded in 2003 and based in San Francisco, Pantera Capital was once a traditional investment fund, although it shifted its focus in 2013 to cryptocurrencies and blockchain projects. According to a range of estimates, it has assets under management worth anything from $335 million to $724 million, although this may have fluctuated in recent months. It has also invested a considerable sum in 72 crypto-related startups and projects, with it having raised at least $200 million in total from outside venture capital in order to fund such investments ($13 million in 2016, $25 million in 2017, and $175 million in 2018-2019).

Pantera Capital has backers from outside the cryptocurrency industry, which is significant insofar as it indicates not only mainstream interest in crypto but also the possibility that it may feel some kind of indirect pressure to invest in projects that would be more pleasing to its financial backers. As for Pantera Capital's general outlook, it may come as no surprise to hear that the fund is very bullish on the future of cryptocurrency and blockchain. In July, its CEO and founder, Dan Morehead, predicted that Bitcoin may hit $42,000 by the end of year and that it could climb as high as $356,000 in a couple of years. Despite this confidence, Pantera Capital is no stranger to setbacks. For instance, it admitted in December 2018 that it could be forced to pay refunds and fines for around 25% of its initial coin offering portfolio, given that roughly this proportion of the portfolio is likely in violating American securities laws. Similarly, during the 2018 bear market, its digital asset fund (i.e., its cryptocurrency fund) lost around 77% over the first 10 months of that year.

Galaxy Digital

Launched in New York City in 2018 by former Goldman Sachs partner Michael Novogratz, Galaxy Digital is another hundred-million-dollar crypto hedge fund. As of the end of June 2019, its total assets under management is $393.3 million, having dipped from May's total of $421.6 million. During 2018, the fund posted a net loss on its balance sheet of $272.7 million, largely because of the bear market and crumbling crypto prices. In addition to investments in cryptocurrency, Galaxy Digital has also invested in around 20 crypto-related projects, including Bakkt, BlockFi, Ripple, Block.one, BitFury, BitGo and Bitstamp. As with the other funds on this list, such ventures have been made possible by investments from noncrypto backers. That's because when Galaxy Digital launched in January 2018, it had not only $400 million of Novogratz's own capital but also raised a further $200 million by floating the company on Canada's TSX exchange.

Andreessen Horowitz

While it's focused mostly on companies operating outside of the cryptocurrency sector, Andreessen Horowitz established its own crypto investment fund, called a16z. As of writing, a16z claims that its fund is worth $350 million, while back in June 2018, when it was launched, the total came to $300 million. This is a big figure in the context of the crypto industry, but compared to the $7 billion in assets that Andreessen Horowitz manages in total, it seems a little more modest. However, it's likely that the value of a16z has increased since May. More importantly, however, is the fact that a massive investment fund with $7 billion in AUM is also interested in crypto, which is a significant vote of confidence for the industry.

This vote of confidence doesn't derive only from direct investment in cryptocurrencies, however. Andreesseen Horowitz and a16z have also thrown venture capital at a range of cryptocurrency startups, spanning Coinbase, Maker, Filecoin, dYdX and CryptoKitties. For example, in August 2018, the fund, together with Polychain Capital, invested $105 million in blockchain-based cloud startup Dfinity, having already contributed a combined $61 million in a previous round in February of that year. Even forgetting a16z, Andreesseen Horowitz is therefore heavily invested in the cryptocurrency industry and is one of the biggest funds operating in the space today. More encouragingly, recent events indicate that it wants to involve itself even more heavily in the sector — as in April of this year, it announced plans to restructure its entire business and register its employees as financial advisors. The reason? This would provide it with the legal basis to engage more in riskier ventures, such as cryptocurrencies.

The rest

Of course, these aren't the only big investment funds operating in crypto to the tune of hundreds of millions of dollars. Others include:

  • Union Square Ventures, which has around $256 million of cryptocurrency assets under management, according to Crypto Fund Research.

  • Blockchain Capital, which launched in 2018 and raised $150 million for its new fund in March 2018, bringing its total AUM to $250 million.

  • IDG Capital, which launched in China in 1992 and invests in noncrypto as well as crypto assets, and has $210 million digital assets under management.

  • BlockTower Capital, which launched in 2017 and has around $130 million in AUM (as of December 2018).

  • Boost VC, a California-based fund that launched in 2014, which has $95 million in AUM.

  • Fenbushi Capital, a China-based crypto fund that had $50 million in assets under management in early 2018.

These aren't the only significant funds working in the crypto industry. However, in a rigorous study published in May 2019, PwC and investment firm Elwood concluded that the vast majority of cryptocurrency investment funds are in fact pretty small.

For instance, the survey found that more than 60% of 150 active crypto hedge funds have less than $10 million in AUM, with only 10% of these funds managing more than $150 million. It also found that the average crypto fund’s AUM is only $21.9 million, indicating that, despite a few big fish, much of the sector is populated by smaller firms trying to capitalize on the cryptocurrency market. More disconcertingly is that the report also notes a lack of independent governance in the average fund, given that only 25% have boards with independent directors, something that may be risky in cases of emergency, when clear, cautious decisions are needed. Similarly, over 90% of crypto hedge funds don't use third-party research, suggesting that they suffer from a deficit of external, objective input.

Still, while this might indicate that the crypto hedge fund sector is immature and vulnerable, there was a pronounced increase in crypto hedge funds and the assets under their management in 2018, according to Morgan Stanley research. In 2014, for instance, there were only 31 such funds, while there were 220 by November 2018. More impressively, these funds had $7.1 billion in assets under management in July 2018, driven largely by demand and involvement from institutional investors. It is for this reason that it would be unwise to predict that the importance and presence of crypto funds won’t grow even further in 2019 and the years to come. As the foregoing overview has shown, they function as an indispensable medium between big institutional investors and the nascent cryptocurrency industry. This means that the more they grow,

Article Produced By
Simon Chandler

Simon Chandler is a journalist based in Hove, UK. He writes mostly about technology, with his specialties including cryptocurrencies, AI, VR, and social media. He also occasionally writes about politics, culture and music, and has contributed to the likes of Wired, the Daily Dot, the Verge, Computer Weekly, Techcrunch, Bandcamp Daily, the New Internationalist, the Kenyon Review, and Tiny Mix Tapes

https://cointelegraph.com/news/biggest-crypto-hedge-funds-and-what-they-tell-about-the-market

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UK Accused of Allowing Billions in Crypto Fraud in its Indian Ocean Colony

UK Accused of Allowing Billions in Crypto Fraud in its Indian Ocean Colony

Chagos Islanders Seek Restitution of Popular .IO Domain

British Indian Ocean Territory is best known for the secretive US naval base on Diego Garcia Island but is also home to the top level domain .IO that is popular with crypto asset and technology companies. The United Nations General Assembly, African Union, and International Court of Justice have found that Britain’s deportation of the Chagos Islanders a generation ago and continued occupation of the Chagos Archipelago (British Indian Ocean Territory) is unlawful and a serious violation of international law. According to the Complaint the British have stubbornly refused to vacate the Chagos Archipelago not only due to the presence of the US naval base but because billions of dollars in covert financial transactions are at stake.

In 1997 a secret agreement with the British Crown resulted in the creation of the top level domain country code .IO (ccTLD .IO). .IO was a relatively low key alternative domain until about 2016 when its popularity exploded in connection with the rise of cryptocurrency. In 2017, the company administering .IO was sold for $70 million to internet giant Afilias Ltd. which is the world’s second largest Internet domain name registry. The Chagos Islanders are now seeking restitution and return of .IO which has made the Chagos Archipelago one of the world’s least known but largest offshore financial centers by daily dollar volume. A complaint has been filed with the African Commission of Human & Peoples’ Rights (the Banjul Court) which has jurisdiction over the Chagos Islands and the issues of recovery and restitution.

According to Dr. Jonathan Levy, the international lawyer representing the Chagos islanders, while .IO is utilized by legitimate companies, it is also remarkable for crypto asset based criminal operations: Ponzi and pyramid schemes, High Yield Investment Platforms, and fraudulent Initial Coin and Token offerings. Dr. Levy explains: “The criminals know there is zero law enforcement in the British Indian Ocean Territory, they use only cryptocurrency, they need no address besides a .IO domain and crypto wallet to commit crimes like fraud, money laundering and extortion.” Dr. Levy estimates tens of billions of dollars a day in unregulated crypto asset transactions take place in .IO involving hacking, tax evasion, money laundering, fraudulent investment schemes, gambling, terrorism and organized crime financing including the well-known crypto scams OneCoin and USITech.

Article Produced By
Dr. Jon Levy

Dr. Jon Levy is a solicitor who specialises in transnational law and private international law. He has represented the former president of the Republic of China, Chen Shuibian, the former Deputy Prime Minister of Yugoslavia, and numerous African entities and political figures. He has been engaged by clients against the US Office of Foreign Asset Control (OFAC), CIA, US Army, and UK Cabinet. As a litigator he specialises in transnational asset recovery and has taken up cases against the Vatican Bank, UBS AG, the Swiss National Bank, Emaar Corporation, and many others.

https://thebitcoinnews.com/uk-accused-of-allowing-billions-in-crypto-fraud-in-its-indian-ocean-colony/

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Bitcoin Hater Peter Schiff Says Dollar Approaching ‘Wile E. Coyote Moment’G

Bitcoin Hater Peter Schiff Says Dollar Approaching ‘Wile E. Coyote Moment’G

Today the price of gold hit a new record-high at $2,008 and the asset is now in the price discovery phase. 

The precious metal appears to be rallying due to the declining U.S. dollar and this could also positively affect Bitcoin (BTC) in the medium-term due to the correlation between the two assets. In trading, the term price discovery refers to when an asset’s price surpasses its previous all-time high. Given that gold is now seeking a new peak, and its momentum remains strong, traders expect that the asset will continue to appreciate until a clear resistance level is established.

A weak dollar is good for gold, and possibly Bitcoin

According to Peter Schiff, the chairman of SchiffGold and a well-known gold advocate, the weakening dollar has pushed gold upwards. Sc

hiff said:

“The price of #gold is now above $2,000 per ounce for the first time ever. For now, the significance of the dollar's record low is lost on the vast majority of investors. But as thousand-dollar milestones fall like dominoes the gravity of the problem will be more widely apparent.”

In recent months, the value of the U.S. dollar has fallen substantially in comparison to other top reserve currencies. Consequently,this boosted alternative and safe-haven assets, including gold.s Cointelegraph reported, industry executives believe a weakening dollar could also strengthen the price trend of Bitcoin. OKEx CEO Jay Hao, trader Scott Melker, and researcher Mark Wilcox said the drop of the dollar benefited Bitcoin. Pinpointing the inverse correlation between the US dollar and Bitcoin,

Melker said:

“Bitcoin is the blue line. The dollar is the grey line. See the inverse action?”

Over time, Schiff emphasized that gold could continue to see an explosive rally as the dollar’s decline rattles investors.

Schiff added:

“No one seems worried about the falling dollar. That's likely to remain the case until the fall becomes a crash, which I don't think will begin until the Dollar Index breaks 80. At its current rate of decline that level could be breached before year end, perhaps by election day.”

Similar factors are seemingly buoying investor sentiment around gold and Bitcoin. In the near-term, due to rising virus cases and investor uncertainty, analysts are bracing for a gloomy trend for the dollar. The confluence of the recent correlation with Bitcoin and gold, and the falling dollar could benefit BTC heading into 2021.

Is Bitcoin really digital gold?

Researchers at Cryptowat.ch, a market data provider, recently explained that gold matches many of the features exhibited by Bitcoin, except BTC has additional unique characteristics like portability and transactability.

The researchers said:

“In terms of traits as money, gold matches Bitcoin in the categories of fungibility and costliness to forge.”

Since Bitcoin price reached its peak in 2017, the perception of the digital asset as a store of value continues to improve. As gold surges to new highs, Bitcoin is receiving more interest from institutions and continuously being associated with gold. These are all factors that could positively impact BTC price in the medium-term, especially considering BTC’s 24% rally in the past month.

Article Produced By
Joseph Young

Joseph is a web developer and designer, writer and a passionate musician who loves to travel often. He's worked as a researcher for a number of venture capital firms and as a freelancer designer for resorts and corporations in Korea and the Philippines.

https://cointelegraph.com/news/bitcoin-hater-peter-schiff-says-dollar-approaching-wile-e-coyote-moment

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Ethereum-Bitcoin correlation continues to be consistently inconsistent

​​​​​​The relationship between Bitcoin and Ethereum has always been an intriguing one. They are, undoubtedly, two of the market’s most important crypto-assets due to their dominance in the space. Although Ethereum is quite far behind in terms of market cap, in terms of technology, may argue that the altcoin is miles ahead. Owing to the many debates between the two camps, the correlation between ETH-BTC has been discussed a lot lately.

From the attached charts, it can be observed that Bitcoin’s 1-month correlation recently nosedived from 93 percent on 21 July to 58 percent on 2 August. In a similar fashion, Ether’s value with respect to Bitcoin also reached a yearly-high of 3.3 percent, the metric’s highest point since June 2019

While many (Most ETH bulls) are suggestive of the fact that it is positive for Ethereum to detach from Bitcoin, on further analysis, it can be understood that the ETH-BTC correlation is not extremely reliable when it comes to identifying patterns or trends.

A consistently inconsistent tale

From the attached chart, it can be observed that periods of correlation have been marked by a set of ellipses. Each period has its own significance. The first ellipse (blue) marked a period of time when Bitcoin’s valued spiked from $5,000 to a whopping $13,800 in April-June 2019. During that same period, the correlation between ETH and BTC dropped from 0.879 to 0.833.

The 2nd ellipse (red) marked a period when the correlation factor improved from 0.76 to 0.82, but the price movements registered by both crypto-assets were minimal and mostly downwards.

The 3rd ellipse (black) is particularly intriguing because it encapsulates a strong bullish rally from 2 January 2020 to 13 February 2020, with the ETH-BTC correlation heading from 0.826 to 0.851. While a massive collapse followed in March, the correlation continued to rise, topping at 0.901 in April when the market started to recover.

The 4th ellipse (green) consists of the current bullish rally, one that is undoubtedly the strongest rally seen in a while from Bitcoin and Ethereum‘s point of view. The correlation has again seemed to decline from 0.901 to 0.881.

The pattern is pretty clear here, one that suggests that the correlation between BTC-ETH has hardly stuck to one trend over the past two years, jostling between both the bullish and bearish market.

Now, Ethereum’s recent decoupling from Bitcoin could be due to the fact that the asset breached its 2019-high. The same hasn’t been the case for Bitcoin.

Therefore, the correlation between digital assets is definitely an important metric, but its relevancy with a particular trend or rally continues to swing both ways.

 

written by Biraajmaan Tamuly

https://eng.ambcrypto.com/ethereum-bitcoin-correlation-continues-to-be-consistently-inconsistent/

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Bitcoin can blow past $12,000 – if it follows gold’s lead

Bitcoin can blow past $12,000 – if it follows gold’s lead

Bitcoin’s Sunday surprise was a blow-off, and if similar moves by other asset classes are to go by, it was a positive move.

On 2 August, between 0400 and 0500 UTC, Bitcoin’s price dropped by 8 percent in an hour, with many expecting its breakout, which began on 23 July, to have come to an end. However, all signs point to the opposite.  Minutes after the cryptocurrency breached the $12,000 mark for the first time since July 2019, a massive surge in sell orders pulled down the price below $11,000. On some spot exchanges, the price dropped to four digits while on Binance Futures, Bitcoin hit $100,000. Given the fact that Bitcoin, in the past two weeks, has jumped from $9,000 to $12,000 and was trading at around $11,200 at press time, the 2 August move was minor, but important nonetheless. 

Such a rapid drop is seen in all markets and is referred to as “blow-off tops” in technical terms. However, such ‘blow-off tops’ are preceded by a rapid rise in price and succeeded by a rapid decrease. Looking at the Bitcoin charts over the past two weeks, it can be observed that the rise was not rapid, but gradual. Between 23 June and 26 June, the price rose from $9,000 to $9,800 before breaking out. Only a full week after Bitcoin had consolidated over $10,000 did the move to $11,500 and over manifest. However, according to yesterday’s turn of events, it was too soon. Economist and cryptocurrency analyst Alex Kruger estimates that based on this signal, Bitcoin is in store for “Higher highs” in 2020. 

After observing yesterday’s move, drop, and recovery, it’s likely that traders placed triggers around the $12,000 mark, which when breached, resulted in sell orders, pulling the price down to $11,000 and below. Further, since the price comfortably held over $10,000 and even managed to rise above $11,000 later, stop-losses were likely placed below. The need to liquidate assets for cash is not as pressing as it was in March 2020, and most markets are, because of central bank printing, recovering. Hence, technical factors and overarching favorable macroeconomic conditions would explain why Bitcoin didn’t drop below $10,000, and why it was able to push over $11,000 in quick time. 

A comparison with gold showed a similar movement. Since central banks began employing loose monetary and fiscal policies, gold has been skyrocketing and now, XAUUSD is trading at its ATH. On 28 July, between 0100 and 0700 UTC, gold’s price dropped from $1,970 to $1,912, a 3.13 percent drop, which in the gold markets is substantial [for context, gold had one of its best trading years in 2019, rising a full 21.7 percent]. D espite the drop, trading continued and by 31 July, it regained its lost value, while on 2 August it rose over $1,980. Given Bitcoin mimicking a safe-haven asset since the March 2020 drop and its Q2 recovery, there’s reason to believe this ‘blow-off’ could push the cryptocurrency’s price higher, much as it did for gold.   

Article Produced By
Aakash Athawasya

Aakash is a full-time cryptocurrency journalist at AMBCrypto covering primarily the US market. A graduate in Finance and Economics, his writing is centered around regulation and institutional investment within the cryptocurrency space. He is also an aspiring triathlete.
 

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Cointelegraph Talks Recap: Blockchain Giving Power to the LGBTQ+ People

Cointelegraph Talks Recap: Blockchain Giving Power to the LGBTQ+ People

Seven experts from different institutions and organizations discussed topics relating to diversity, inclusion, challenges and opportunities for LGBTQ+ with Cointelegraph.

Yesterday, Cointelegraph hosted another episode of “CT Talks,” dedicated to Pride Month and addressing important questions on diversity,

inclusion, stigmatization, acceptance, challenges and opportunities for the LGBTQ+ community in the crypto and blockchain space.For many people — mostly heterosexuals — the terms “blockchain” and “LGBTQ+” used so close together might seem irrelevant. For those who are a part of the community, as I am, it is perfectly natural to raise this topic within the space, combining these discourses.Emerging technologies such as crypto, blockchain, AI and big data have already made an enormous impact on people all over the world, and the LGBTQ+ community is no exception. There are myriad potential benefits that these technologies can bring to the community, and we are still only at the early stages of its implementation. I personally believe that a lot of great things will appear in the near future.Speaking on one of the benefits, Joe DiPasquale, CEO of BitBull Capital and co-founder and director at StartOut, underlined the positive impact of privacy and anonymity that crypto and blockchain

provides to the space:

“There is a lot of excitement about blockchain and crypto and how it could impact society. […] The thing is that blockchain and crypto truly brings in though is also true privacy. […] I guess for fundraising or raising money online, that’s obviously a major impact for crypto. And you can do it in a truly anonymous way.”

Christopher Wood, the co-founder and executive director at LGBT Tech, spoke about the LGBTQ+ community and how it can help in terms of adoption and

implementation:

“The LGBTQ+ community has always been an early adopter of technology because of the fact it could create an opportunity for the community, for us, for people who were really isolated or felt that they were alone. […] Newer technologies allow our community to put money where their month is, to go ahead and support causes they really care about.”

Susan Oh, the founder and CEO at Muckr.AI, while speaking about technology highlighted that blockchain possess a great philosophy behind it that brings value

to the tech:

“The most important thing to understand about the technology is that it can only amplify the philosophy. […] There are great opportunities to democratize value. […] We get to look at the value by its utility, by how it serves us. And we can do it peer-to-peer. It’s a beautiful philosophy.”

Christof Wittig, the co-founder and CEO of Hornet, stressed the criticality of blockchain and other emerging technologies in countries that still have homophobic laws. In those countries, LGBTQ+ people rely on anonymity and community support to navigate their everyday lives under an authority that discriminates against them.

He also said:

“There is still a lot of discrimination within the United States and Western countries, we are not there yet for everyone, and there is still a lot to do. Everyone who thinks otherwise is either very insular in their thinking […] and doesn’t know about people of color, underprivileged people, positive people. […] And then of course we have 72 countries that criminalize LGBT.”

The second part of the panel addressed — among other things — probably one the most important topics for the 21st century: health, with a focus on HIV/AIDS and COVID-19. Answering on whether blockchain tech could help humanity fight different diseases, Dr. Jane Thomason, chief inspiration officer at Fintech.TV and former

CEO at Fintech Worldwide, stated:

“Yes, yes and yes! And if there is one benefit of the COVID-19 pandemic that I see is that it’s forced some of those legacy curtains in the health system to start opening up, as people have been much more willing to accept technology to help, to try and solve some of the issues of the pandemic.”

Erik Lamontagne, a senior economist at UNAIDS, underlined that we are still at the very beginning of technological development in blockchain, and there will be a lot of new discoveries in the field.

He said:

“Just think how it was less than 10 years ago when there was an emerging epidemic in a village, in a remote place in a country in Africa or Latin America, for example. […] This technology [DLT] enables us to move almost as quickly as epidemics are moving. And this is fantastic! This is one of the opportunities.”

Sean Howell, the chair at Tech4HIV and CEO at LGBT Foundation, highlighted the issue of stigmatization of HIV-positive people and the lack of accessibility to HIV tests in many regions. This can be solved via e-commerce on a blockchain for selling cheap and high-quality tests while preserving people’s privacy, as enabled by the immutability and privacy of

distributed ledger technology:

“In places that have high epidemics face high stigma. […] These are places that have high HIV and it’s almost impossible to go and get a HIV test — either they are simply not offered or you don’t want to disclose that you have sex with men or you being HIV-positive [as it] would be associated with being gay.”

Indeed, our problems cannot be solved with technology, whether it’s blockchain, crypto or something else. Technology itself is very inclusive and doesn’t hold any prejudices, stereotypes or unacceptance of its own. It’s people that have those things. We have to first change our own attitudes in order to work toward a better world and teach ourselves how to be more tolerant, more open-minded and more inclusive to all kinds of diversity. Blockchain will be a great tool in our fight for equality and social justice for everyone. Cointelegraph Talks is a series of online meetups where crypto and blockchain experts discuss challengi ng topics in the space. Keep posted for new episodes on Cointelegraph YouTube.

Article Produced By
Max Yakubowski

Max Yakubowski is the opinion editor at Cointelegraph. He has a Master of Arts in linguistics and social anthropology and is passionate about innovative technology and its cultural and social influence as well as discursive representations. Prior to Cointelegraph, he worked as an academic curriculum developer and researcher at various educational organizations and institutions.

https://cointelegraph.com/news/cointelegraph-talks-recap-blockchain-giving-power-to-the-lgbtq-people

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BTCS Crypto Portfolio Expands Over 280% in Q2 2020 Amid COVID-19 Pandemic

BTCS Crypto Portfolio Expands Over 280% in Q2 2020 Amid COVID-19 Pandemic

While many institutions struggled to recover from the market downturn

experienced in March, publicly-traded, blockchain-focused firm BTCS Inc. (OTCQB: BTCS) has increased its portfolio by 285 percent in Q2 2020, through well-timed investments in both bitcoin (BTC) and ether (ETH), and crossed the $1 million mark for cryptocurrency assets under management (AUM). Following the positive growth performance seen in Q2 2020, BTCS is reportedly eyeing further growth and systemic diversification of its cryptocurrency holdings. However, BTCS said its investment strategy will only focus on cryptocurrencies which it believes are not securities.

Timely Crypto Purchasing Catapults BTCS Portfolio Valuation

At the end of June 2020, the BTCS crypto portfolio stood at a total value of $1.02 million with sizeable positions in BTC and ETH. Having elected not to add further investments to its portfolio, BTCS navigated the massive decline in cryptocurrency prices seen in mid-March. With the World Health Organization (WHO) classifying the novel coronavirus as a pandemic on March 11, panic spread through both the crypto and broader financial space. By the following day, both markets were seeing a cascade of forced selloffs as traders sought liquid cash in preparation for the inevitable lockdowns.

By holding off from adding to its crypto investments during the first quarter of 2020, BTCS safeguarded its balance sheet from the decline seen on Black Thursday. Bitcoin fell to $3,867 in a matter of hours as token selloffs triggered forced liquidations across several derivatives exchanges, including BitMEX. The entire crypto market capitalization shrank by about 50 percent. During Q2 2020, BTCS added 33.7 BTC and 1,319.6 ETH to its crypto holdings. In total, the company’s cryptocurrency exposure rose to 54.3 BTC and 2,304.6 ETH. Since March 12, bitcoin is up almost 150 percent with its Q2 performance standing at 50 percent. In U.S. dollar (USD) terms, BTCS’s crypto holdings grew, primarily from accumulation, from less than $300,000 at the end of the first quarter of 2020 to over $1 million by the end of Q2 2020, representing a 285 percent increase.

Portfolio Diversification And Other Future Plans

Having successfully navigated the pitfalls in the crypto market during the first half of 2020, BTCS is reportedly looking toward expanding its cryptocurrency portfolio. However, given the mixed fortunes of other institutions since the onset of COVID-19, BTCS says it will adopt a carefully measured approach to its portfolio diversification plans. BTCS is also looking to acquire controlling interests in businesses in the blockchain industry. Recent reports by Deloitte and LeadBlock point to increasing enterprise adoption of the novel technology with over a third of organizations across the world utilizing the emerging technology in their operations.

Article Produced By
CryptoCompare

https://www.cryptocompare.com/portfolio/guides/btcs-crypto-portfolio-expands-over-280-in-q2-2020-amid-covid-19-pandemic/

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US DoJ Charges Group of Individuals Who Stole $2.5 Mln in Crypto Via SIM Swapping

US DoJ Charges Group of Individuals Who Stole $2.5 Mln in Crypto Via SIM Swapping

The U.S. Department of Justice announced that a group of hackers might face over 100 years in prison after stealing $2.5 million.

The United States Department of Justice released a fifteen-count indictment on May 9 that charges a hacking group

labeled “The Community” with SIM swapping in order to steal cryptocurrencies. U.S. Attorney Matthew Schneider and his colleague from the U.S. Immigration and Customs Enforcement Angie Salazar announced the charges in the Eastern District of Michigan. Per Salazar, the investigation was led by Homeland Security Investigations on two continents.

According to the indictment, five Americans and an Irishman are charged with conspiracy to commit wire fraud, wire fraud and aggravated identity theft. Another three, who reportedly are the former employees of mobile phone providers, are charged in a criminal complaint with the wire fraud related to “The Community.” As described in the document, the hacking group used SIM swapping — a type of identity theft attack that generally targets a weakness in two-factor authentication. The perpetrator usually gains control of a target's mobile phone by convincing or bribing the employee of the mobile provider to swap the phone number to a SIM card controlled by the hackers.

After successfully swapping the numbers of their victims, “The Community” managed to gain access to their various online accounts, including cryptocurrency exchange accounts and wallets. As a result of fraud, approximately $2.5 million worth of cryptocurrency was sent to wallets controlled by the hacking group. Attorney Schneider clarified that in this case, three mobile phone service provider employees purportedly helped swappers to steal money. The charges of conspiracy to commit wire fraud and wire fraud carry a maximum penalty of 20 years in prison each. Meanwhile, a conviction of aggravated identity theft could add up to two years in prison for the defendants .

According to Irish news website The Journal, a 20-year-old man from Dublin was arrested in Ireland upon the request of the U.S. authorities and is currently awaiting extradition. As Cointelegraph previously reported, in November 2018, a law enforcement group dedicated to fighting cybercrime released a report on SIM swapping, stating that it had become increasingly popular in California. Meanwhile, in January, a 21-year old American was accused of stealing almost $24 million in crypto via SIM swapping. And in February, a New York resident was indicted in what constituted the jurisdiction’s first SIM-swapping prosecution.

Article Produced By
Ana Berman

Moved by her interest to discover the world of decentralized technologies, Ana joined Cointelegraph in June 2018. Shortly after joining the team as a news writer, she focused on the major crypto stories from Latin America

https://cointelegraph.com/news/us-doj-charges-group-of-individuals-who-stole-25-mln-in-crypto-via-sim-swapping

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As DeFi Booms, Yearn Finance (YFI) Shifts 100% of Token Supply to Users

As DeFi Booms, Yearn Finance (YFI) Shifts 100% of Token Supply to Users

The DeFi sector recently achieved a record $4.23 billion in total value locked, so why did Yearn Finance distribute its full token supply to its users?

As Decentralized Finance protocols continue to grow on all fronts, their infrastructure grows alongside them. 

While the total value of USD locked in DeFi recently hit a new all-time high at $4.23 billion, liquidity issues have also been a challenge and this led to the creation of decentralized liquidity pools like Uniswap and Balancer. These pools provide liquidity to DeFi platforms through smart contracts and offer interest to the liquidity providers. The latest DeFi boom is partially driven by the addition of reward incentives in lending and the rapidly increasing popularity of yield farming. The process involves users gaming the protocol to “mine” reward tokens by moving from one asset to whichever one is the most profitable.

This appears to have been kicked off by lending and credit protocols like Compound rewarding lenders with COMP tokens, along with the base interest rate in an effort to improve liquidity. In July, a new liquidity pool called Yearn Finance took the mainstage as 30,000 Yearn (YFI) tokens were minted and distributed to users, according to Flipside Crypto.

Decentralized governance and fair distribution comes to DeFi

In an effort to automate the process of yield farming, Yearn.Finance launched a set of smart contracts that maximize earning by automatically changing liquidity pools according to who the highest payer is. Through a multi-token staking mechanism, users of the Yearn.Finance protocol can also receive YFI, a governance token. Governance tokens don’t give access to dividends or any other monetary incentive. Instead, they are used as voting chips that allow users to collectively decide the platform’s trajectory, thus making it truly decentralized. 

On July, 17, Yearn.Finance founder, Andre Cronje, distributed the entire initial supply of YFI to users of the protocol in three separate liquidity pools. Yes, this is correct. The entire supply of YFI was distributed and the team kept none for themselves.  According to the team behind YFI the distribution was carried out

in an effort to:

“Give up this control (mostly because we are lazy and don’t want to do it), we have released YFI, a completely valueless 0 supply token. We reiterate, it has 0 financial value. There is no pre-mine, there is no sale, no you cannot buy it, no, it won’t be on uniswap, no, there won’t be an auction. We don’t have any of it.” 

Ultimately, the intention of the distribution was to delegate governance rights (and responsibilities) to the community in a decentralized and fair manner, something which remains fairly revolutionary for the post-ICO crypto space. 

Is DeFi maturing or in a bubble phase? 

Since being listed on Uniswap, YFI’s price rallied by more than 4,000% in a single day and currently sits at $3,674. Cronje previously told Cointelegraph he has “no clue” why the token price grew so much since he only wanted to “distribute voting rights”. As such, the current DeFi and yield farming mania is somewhat reminiscent of the 2017 ICO craze when tokens with no value were pumped for no apparent reason and even projects with names like “Useless Ethereum Token” were able to raise considerable sums of money. 

Some may conclude that rampant speculation is taking over the sector and that the latest yield farming craze will eventually have an outsized negative impact on the entire DeFi ecosystem. For example, in mid-July, Compound’s reward mechanism propelled Basic Attention Token (BAT) price to unreasonable heights before COMP altered their reward mechanism. While this is a valid concern, liquidity pools appear to be adding value and increased utility to numerous DeFi platforms. The fact that YFI and an increasing number of governance tokens are fully operated by their repsective communities is inarguably a positive step forward as this will further democratize the crypto space and preserve the decentralized ideas the entire sector was built upon.

Article Produced By
António Madeira

António Madeira is a cryptocurrency enthusiast and writer from Portugal. Drawn by the potential for world change found in cryptocurrencies, and fascinated by their technical and economic aspects, António has been writing about blockchain technology, cryptocurrencies and fintech for publications since 2016.

https://cointelegraph.com/news/as-defi-booms-yearn-finance-yfi-shifts-100-of-token-supply-to-users

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Five psychological reasons why people fall for scams – and how to avoid them

Five psychological reasons why people fall for scams – and how to avoid them

Con artists, fraudsters and their hapless victims are a staple of the news cycle and hardly a week seems to pass without a story about an e-mail lottery scam or a telephone fraud. Many reading these stories perhaps just raise their eyebrows and shake their heads, wondering how people can be so gullible.

There is often an assumption that the victims have specific traits – perhaps they are elderly or less well educated? Or maybe the victims are particularly vulnerable – recently bereaved or socially isolated perhaps?

Figures do suggest that one in five over-65s say that they have been targeted by email scammers. But it is also likely that that nobody is immune to fraud and sometimes people simply fall for scams due to the psychological techniques employed by fraudsters.

Using some of the ideas outlined by psychology professor, Robert Cialdini, here are five psychological reasons why people fall for scams.

You scratch my back…

Beware the principle of reciprocity. If someone does something for us, we feel more obliged to do something for them. Scammers use this type of “enforced indebtedness” to elicit an unwise action from their target. For example, someone offering you an exclusive opportunity to invest your money can be seen to be doing you a favour. That in turn makes people want to return the favour – which could be as simple as continuing to listen to their sales pitch, or as destructive as signing up for a bogus scheme.

Like lemmings off a cliff

Research shows that if a person believes other people are doing something, then they feel it must be okay for them to do it too. This is especially true when individuals find themselves in a pressured and ambiguous situation – such as a sales pitch. If a person on the other end of the phone tells us that 75% of people like us have signed up to this financial scheme, then we are much more likely to do so – even though we might secretly doubt the veracity of such claims.

Little steps

People like to think of themselves as being consistent and committed individuals. If we say we are going to do something, then generally we will, as failure to do so may dent our sometimes fragile self-esteem.

Fraudsters take advantage of this by getting us to commit to little steps that then escalate in nature. For example, by simply getting people to answer their “trivial” questions (how are you today?), the fraudster is getting their prey to fool themselves into believing that they are happy to talk to this unknown person. And, of course, trivial questions lead to more personal ones, like who do you bank with? Having answered one question, it would be inconsistent not to answer another one. And, after all, we like to perceive of ourselves as helpful and polite individuals.

FOMO (the fear of missing out)

People are generally worried about missing out on an opportunity, perhaps for “the next big thing”. And if such an “offer” is for a limited time only, then the principle of scarcity suggests that people are more likely to be drawn to it.

When our freedom to be able to do something is threatened, we tend to react quickly to ensure that we don’t miss out. When pitching financial offers, scammers will claim that this offer is only valid now and as soon as they put the phone down, the offer will be gone. Many people will feel that they simply can’t miss out on such an opportunity.

They seemed so nice

The principle of similarity suggests that we tend to like people who seem to be the same as us, and, in turn, we are much more likely to agree to a request from someone we like. Similarity can be as broad as an interest in financial investments or as fleeting as sharing some personal characteristics.

Scammers take advantage of this and try to find out things about us in order to appear to be like us. For example, asking your date of birth, and then mentioning that it is their date of birth also, can have the unconscious effect of making you like them more – and hence more likely to agree to their requests.

While it is unlikely that any one of these psychological ploys on their own would be sufficient to persuade someone to do something that is against their best interests, in combination they can be powerful tools for a con artist. But by being aware of, and understanding, these five simple psychological principles, people are far more likely to be able to resist them and avoid being scammed.

This artical was currated from

Naomi Schalit

Senior Politics + Society Editor

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