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Russia’s Biggest Bank Sberbank Unveils Crypto Plans to Follow Upcoming Regulation

Russia’s Biggest Bank Sberbank Unveils Crypto Plans to Follow Upcoming Regulation

The largest bank in Russia, the state-owned Sberbank, has reportedly unveiled its crypto plans as the country is set to begin regulating the industry in January. Sberbank’s CEO says the bank may issue its own cryptocurrency in collaboration with JPMorgan.

Sberbank’s Crypto Plans and Sbercoin

The CEO of Sberbank, Herman Gref, unveiled on Monday his bank’s plans for when the country’s upcoming crypto regulation takes effect.

Gref explained that the law “On digital financial assets” will enter into force in Russia on Jan. 1. It provides a legal definition for digital assets and legitimizes cryptocurrency in Russia. A separate bill, “On digital currency,” which is still under consideration by the Duma, will provide a regulatory framework for cryptocurrency. Gref was quoted as saying:

From January 1, the law comes into force, we want to bring to the market our new blockchain platform, which will provide services for the purchase of digital financial assets.

In addition, Reuters reported Tuesday that Sberbank is considering issuing its own cryptocurrency called “sbercoin” and may team up with JPMorgan to work on the project next year. JPMorgan recently launched the JPM Coin. Gref explained that Sberbank will work on its cryptocurrency at the same time as the Bank of Russia works on a central bank digital currency (CBDC), the digital ruble.

Sberbank is the largest bank in Russia, Central and Eastern Europe. Its Russian network features 11 regional banks with 14,200 branches in 83 regions. The bank has a worldwide presence in 18 countries. The Russian Federation represented by the Ministry of Finance “owns 50% plus one voting stake in Sberbank’s authorized capital (or 52.23% of all voting Sberbank shares),” the bank’s website details.

What do you think about Sberbank’s crypto plans? Let us know in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons

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Here’s How Bitcoin Could Spark a Massive Move Higher for Smaller Altcoins

Bitcoin

Here’s How Bitcoin Could Spark a Massive Move Higher for Smaller Altcoins


  • Bitcoin has seen some wild price action throughout the past few days and weeks, with the selling pressure seen at its all-time highs sparking multiple rejections
  • Neither of the rejections seen at this level have done much to change the crypto’s trend, as it continues pushing higher each time
  • Where the entire market trends next will depend largely on whether or not BTC can stabilize within the lower-$19,000 region
  • Each visit to its highs degrades the resistance existing here, meaning that it may only be a matter of time before it is broken above
  • One trader is noting that, if history rhymes, Bitcoin breaking above its all-time highs could be all that is needed for smaller crypto-assets to see massive upside

Bitcoin has been guiding the entire market throughout the past few days and weeks, which has subjected altcoins to immense volatility.

Yesterday morning, BTC rallied as high as $19,800, which marked an all-time high on some exchanges.

Despite being a historic moment, bears still tried to fade the move and sparked a strong rejection at this level. This led BTC down to lows of $18,200 before it found some strong momentum and rallied significantly higher.

It is now back within the lower-$19,000 region and looking strong, meaning that this may have once again been another bear-trap.

One trader expects a break above Bitcoin’s all-time highs to spark a serious upside movement for altcoins.

Bitcoin Rallies from Lows, Creates Tailwind for Altcoins

At the time of writing, Bitcoin is trading down just under 2%.

This marks a decline from its recent highs of $19,800 that were set yesterday and marks a notable surge from lows of $18,200 set just a few hours ago.

The potent reaction to this selloff does seem to indicate that upside is imminent for the cryptocurrency.

Trader: BTC Breaking Its All-Time Highs Could Catapult Altcoins Higher 

This recent BTC turbulence has had massive impacts on the price action seen by altcoins.

One trader is now noting that a break above Bitcoin’s all-time high is a historically bullish event for altcoins, despite a common narrative that suggests BTC entering price-discovery could hamper the growth seen by its smaller counterparts.

“In last 2 cycles, alts rallied extremely hard each time BTC broke its old high, will it be the same again?”

Bitcoin

Image Courtesy of CL. Source: TradingView.

Assuming that history rhymes, as it so often does, this means that the next few days could be massive for the future of altcoins, as Bitcoin is once again just a stone’s throw away from fresh all-time highs.

Featured image from Unsplash.
Charts from TradingView.

XRP Could Target a Move to $1.80 as Technical Strength Flourishes

XRP has been one of the most surprising beneficiaries of the recent market-wide uptrend, with the previously embattled cryptocurrency exceeding Bitcoin’s gains over a short time frame while also outpacing Ethereum and other major altcoins.

Its strength came about following the break above a multi-year trading range that it has been stuck in between $0.20 and $0.30. Once $0.30 was flipped into support, it began its parabolic ascent.

Its momentum is now slowing down due to a few key resistance levels, but where it trends next will likely depend on whether or not Bitcoin and the rest of the crypto market can find some stability.

Both BTC and ETH have seen some immense turbulence throughout the past 24 hours, with bears fading the benchmark crypto’s all-time highs and causing the aggregated market to show some signs of weakness.

Unless Bitcoin gains stability, altcoins like XRP may struggle to extend their newfound momentum.

Nevertheless, one trader is expecting XRP to see some immense gains in the near-term, pointing towards $1.80 as a potential upside target in the near-term. He does note that it may first find some resistance around $1.12.

XRP Stagnates as Bitcoin Struggles to Set New Highs

Yesterday was a wild day for Bitcoin and the entire market. After facing an intense selloff that sent BTC reeling down to lows of $16,400 last week, BTC bulls stepped up and pushed the crypto to fresh all-time highs of $19,800 on many exchanges yesterday.

The selling pressure here was quite intense and caused the entire market to turn lower, with bulls ardently trying to absorb this selling pressure today.

Naturally, XRP was impacted by this volatility as well. At the time of writing, the cryptocurrency is trading down over 7% at its current price of $0.62. This is around where it has been trading throughout the past few days and weeks.

Trader Claims the Token is Still Poised to Explode Higher

While sharing his thoughts on XRP’s current outlook, one trader noted that he remains firmly bullish on its near and mid-term prospects.

He stated that a move up towards $1.12 could come about shortly, followed by an explosion towards $1.80.

“XRP: Aped in. Targets 1.12 and 1.8,” he concisely noted while pointing to the chart seen below.

XRP

Image Courtesy of Livercoin. Source: XRPUSD on TradingView.

If XRP reaches his upside target, it will mark a nearly 3x movement from where it is currently trading at.

Featured image from Unsplash.
Charts from TradingView.

Privacy Concerns Over Bitcoin Upgrade Taproot Are a ‘Non-Issue,’ Experts Say

Bitcoin privacy experts are far from impressed with a recently circling slideshow-style privacy report that puts Taproot, a likely upcoming upgrade to Bitcoin, in the crosshairs. 

The Taproot upgrade will boost Bitcoin’s privacy and scalability. The years-in-the-making upgrade has been applauded by Bitcoin’s most active developers, with the community being invited numerous times to test and scrutinize it. Plus, in an unprecedented move for large Bitcoin upgrades, the majority of bitcoin miners are now signaling support for the upgrade.

Against this backdrop comes a new report from blockchain explorer Blockchair’s lead developer Nikita Zhavoronkov, who has released several privacy-oriented tools. He argues that because Taproot introduces a new “script” to Bitcoin – which dictates under which conditions coins can be spent – the Taproot coins will become distinguishable from other bitcoins. 

Zhavoronkov, who has developed a reputation for his frequent criticism of Bitcoin, now appears to have one goal: to stop the upgrade. 

But Bitcoin privacy experts pointedly disagree with Zhakoronkov’s claim that Taproot isn’t up to snuff. 

“I think the ‘research’ sucks, to put it bluntly,” said Bitcoin privacy expert Chris Belcher, who works on Bitcoin privacy projects CoinSwap and JoinMarket). In an email to CoinDesk, he argued that, ironically, what Zhavoronkov proposes – to stop Taproot – would harm Bitcoin privacy in the long term.

“What Nikita describes is a non-issue,” pseudonymous bitcoin educator and privacy guru 6102 told CoinDesk.

Veteran bitcoin developer Greg Maxwell, who invented Taproot, went so far as to go on Reddit and call Zhavoronkov’s research an “attack,” warning, “Be informed and don’t let malicious actors sow FUD in an effort to hurt Bitcoin users.”

The criticisms

Let’s dive into the details a bit. Taproot will enable new rules, known as scripts, for locking up coins. Bitcoin has many types of scripts. The most common is just the rule that Bitcoin cannot be sent to someone else unless the user uses a private key to sign it and send it along. But there are others, such as the rule that two-of-three specific users need to sign the transaction to move the coins elsewhere.

Bitcoins locked up in these different scripts each look a little different. Remember, Bitcoin’s ledger is open for anyone to see. It’s possible for busybodies, namely blockchain analysis companies, to peruse Bitcoin’s transaction history and pass on what they find to paying customers, such as government agencies, who may then use this information for a variety of reasonsto crack down on criminals. 

In short, Zhavoronkov points out that once the new Taproot script is added, Taproot coins will stand out from other bitcoins. 

More specifically, he looks at where bitcoin transactions are sent. Bitcoins are stored in chunks called Unspent Transaction Outputs (UTXOs). Say Alice has 3 BTC locked in one UTXO, but only wants to send 1 BTC to Bob. Once she sends the bitcoin to Bob, her 3 BTC UTXO will be split into two pieces: 1 BTC will be sent to Bob, and 2 BTC will be sent back to Alice in what’s called a “change address.”

If the change address script type is the same as the sending address but different from the recipient address then it’s easy to guess where the sender sent their coins. Zhavoronkov argues this is an assumption (known as a “heuristic” in privacyland lingo), that blockchain analysis companies can use to figure out (or at least guess) where funds are going.

Zhavoronkov argues that adding another script for Taproot will increase the likelihood of this privacy hurdle. And he doesn’t think this will be a short-term problem. 

Zhavoronkov argues that if Taproot gets 100% adoption, then he agrees with other Bitcoin developers that the upgrade will be a “net good.” But he doesn’t think it will get to that point.

“Taproot shouldn’t be considered as a ‘privacy feature’ because it’s not like the shielded pool in Zcash or ring signatures in Monero. The advantages are minuscule and applicable to edge cases only,” he added.

Devs: Concerns don’t hold water

Bitcoin developers argue this is a concern that many have already considered. It’s not new information.

“The reality is that this is already a ‘problem’ and adding a new type will likely have negligible impact, while bringing other significant benefits,” 6102 told CoinDesk. He added that the heuristic Zhavoronkov points to can be easily gamed.

Maxwell argued (again, on Reddit) that Taproot was actually designed specifically with the problem Zhavoronkov pointed out. 

“This is a fact that was always discussed along with the development of taproot, and it drove a number of design decisions: e.g., not deploying it as multiple features and making sure new extensions can be deployed in leafs where they may not get exposed,” he said.

Belcher added there are already many, many script types, each of which can be differentiated from others, and adding one more won’t be much of a issue, let alone a catastrophic one as Zhavoronkov describes it. 

“Bitcoin today already suffers from the situation described by that PDF, and Taproot improves the situation on balance,” Belcher said. 

Taproot: A privacy improvement

Further disagreeing with Zhavoronkov, the developers CoinDesk contacted argued the long-term benefits of Taproot far outweigh Zhavoronkov’s concerns. 

The privacy benefit Taproot brings is actually supposed to be the opposite of what Zhavoronkov describes. With Taproot, Bitcoin users will be able to use different ways of locking up their coins “without being able to be distinguished from each other,” as Belcher put it. For example, a transaction used to set up a Lightning channel can be made to look just like a regular bitcoin transaction.

Belcher recently posted a thread on Twitter exploring in more granular detail the ways Taproot will benefit Bitcoin privacy in the long term. 

“Taproot is a huge positive for privacy and it should be added to Bitcoin as soon as is safely possible,” Belcher said, later adding that “this glossy and charismatic, but dishonest, PDF is an attempt to reduce the privacy of Bitcoin.”

Bitcoin developer Lloyd Fournier, who earned a grant from Square Crypto earlier this year, also noted that Taproot transactions are cheaper (contrary to what Zhavoronov said) so users will have an extra incentive to adopt them.
“The immense individual and community effort that went into the specification and engineering around Taproot aims to improve Bitcoin over the coming years and decades. The author’s emphasis on very narrow short-term concerns seems to be misaligned with the long-term flourishing of Bitcoin,” he said.

Market Wrap: Bitcoin Falls to $18.1K as Correlation to Ether Picks Up

The price of bitcoin took a bit of a dip, though overall market sentiment remains bullish. Ether’s correlation to bitcoin is going up despite differences in value propositions.

  • Bitcoin (BTC) trading around $19,077 as of 21:15 UTC (4:15 p.m. ET). Slipping 2.1% over the previous 24 hours.
  • Bitcoin’s 24-hour range: $18,171-$19,920
  • BTC above its 10-day and 50-day moving average, a bullish trending signal for market technicians.

Bitcoin trading on Bitstamp since Nov. 28.
Source: TradingView

The price of bitcoin was able to hit as high as $19,920, according to CoinDesk 20 data, before momentum stalled. Traders began hitting the sell button, taking the price to as low as $18,171 before it recovered. It was at $19,123.70 as of press time. 

Katie Stockton, a technical analyst for Fairlead Strategies, sees $19,511 as a “resistance” level, a price point the world’s oldest cryptocurrency can break through in this time of highly bullish sentiment. An eventual breakout appears likely from a momentum perspective,” she said, noting that $19,511 “is not a strong resistance level – $20,000 is a psychological hurdle, much like Dow 30,000.”

As for equities, Tuesday was green across major market indexes.

A positive performance out of stocks often means bitcoin’s price will trend upward, but Tuesday’s sideways activity again reiterates how volatile the crypto markets can be. In turn, that raises questions about a major narrative regarding bitcoin’s role. 

“Expect additional short-term volatility, although intermediate- and long-term momentum are strongly positive,” Fairlead’s Stockton said. Thus, when looking at bitcoin’s volatility versus popular traditional assets, the store of value thesis may not be as strong as many believe as volatility is trending up versus other investments.

Bitcoin versus S&P 500, gold and bonds in 2020.
Source: Shuai Hao/CoinDesk Research

However, the narrative that bitcoin serves an important purpose in uncertain times still holds for a large swath of the market. 

It is being used as a hedge against inflation that will come from global monetary easing as a result of COVID-19,” said Midori Kanemitsu, a market analyst at cryptocurrency exchange bitFlyer.

Some of this increased volatility may simply be because investors are participating in profit-taking at these lofty levels, said Andrew Tu, an executive for quant trading firm Efficient Frontier. “Currently, there is less stablecoin inflow into exchanges and more bitcoin inflow into exchanges, which suggests less buying pressure for bitcoin for the very near future,” Tu told CoinDesk. 

Analysts are also keeping an eye on ether. The all-time high for the native currency of the Ethereum network is over $1,400 and many think the cryptocurrency is a good buy in this bull market. 

Ether trading on Bitstamp since Nov. 28.
Source: TradingView

“I think ETH is still undervalued versus BTC,” noted George Clayton, managing partner of investment firm Cryptanalysis Capital. “All this DeFi (decentralized finance) going on is showing the utility of smart contract protocols.”

Is bitcoin leading ether?

Ether (ETH), the second-largest cryptocurrency by market capitalization, was down Tuesday, trading around $596 and slipping 2% in 24 hours as of 21:15 UTC (4:15 p.m. ET).

Over the past several days, ether has mirrored bitcoin’s price rise closely.

Bitcoin (gold) versus ether (ETH) performance on Bitstamp since Nov. 28.
Source: TradingView

The correlation between bitcoin and ether is also trending upward, though is lower than it was after the March market meltdown.

Bitcoin and ether correlation in 2020.
Source: Shuai Hao/CoinDesk Research

The fact the two cryptocurrencies are increasingly trading in tandem belies the fact that Ethereum’s 2.0 Beacon Chain launch clearly differentiates some of its use case aspects. While bitcoin’s “store of value” narrative continues to be a strong signal coming from industry analysts, the “programmable money” thesis of Ethereum doesn’t seem to be making the market asset perform based on its own fundamentals – yet. 

“Both assets have definitely seen a [U.S. dollar]-priced upswing, and though BTC has been the one to have a lot of recent news around its proximity to all time highs, Ethereum has been the real star of the summer of DeFi and into the fall compared to BTC,” noted John Willock, chief executive officer of crypto custody provider Tritium. “I believe that as confidence in 2.0 with some operating history and broader investor understanding of the economic implications to the valuation of ETH spreads, we will see a bull run in ETH,” he added.

Other markets

Digital assets on the CoinDesk 20 are mostly red Tuesday. One notable winner as of 21:15 UTC (4:15 p.m. ET):

  • Oil was down 1.1%. Price per barrel of West Texas Intermediate crude: $44.54.
  • Gold was in the green 2.1% and at $1,814 as of press time.
  • The 10-year U.S. Treasury bond yield climbed Wednesday jumping to 0.929 and in the green 11.8%.

South Korea Postpones 20% Crypto Tax Policy to 2022

South Korea Postpones 20% Crypto Tax Policy to 2022

South Korea has delayed the enforcement of its crypto tax law until the start of 2022 providing ample time for exchanges to create the necessary machinery for accurate cryptocurrency financial reporting. The news also finalizes the country’s tax plan after months of speculation concerning levying taxes on virtual currency trading gains.

South Korea’s Crypto Tax Coming in 2022

According to a report by Yonhap on Tuesday (Dec. 1, 2020), South Korea’s parliament has officially postponed the enactment of its crypto tax policy until 2022. Back in November, BTCManager reported that the National Assembly was considering a move to provide an extension to the cryptocurrency taxation policy.

The decision to postpone came after a session of the Planning and Finance Committee which held on Monday (Nov. 30). South Korea’s official tax policy will now come into force in January 2022; three months later than previously scheduled.

By delaying the enactment of the law, South Korean officials say the government is giving sufficient time for crypto exchanges to work out the necessary modalities required for complying with the new directive. When in force, crypto trading profits exceeding 2.5 million won (approx. $2,500) per year. This threshold provides a de minimis crypto tax exemption for gains below this mark.

South Korean exchanges will need to comply fully with real-name trading account regulations as part of the new crypto tax regime. Indeed, this law was part of the provisions included in the legislative action of March 2020 that effectively gave full legal status to crypto trading operations in the country.

Bithumb, as well as fellow “big four” competitors Corbit, Coinone, and Upbit, are the only cryptocurrency exchanges in South Korea currently in compliance with real-name trading accounts regulation. With the crypto tax policy coming in 2022, platforms still have sufficient time to attain full compliance with this regulation.

As previously reported by BTCManager, some critics of the crypto tax plan say levying taxes on cryptocurrency trading gains will stifle the growth of the industry. Indeed, South Korea’s virtual currency space has stagnated over the last two years on the back of successive stringent government regulations.

However, 2020 has seen the government take steps to provide some support for the crypto and blockchain industry. The country’s central bank is also planning to conduct trial runs for an experimental digital currency in 2021.

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