Your Crypto News on Steemit December 28, 2017

• Japanese Bank wants to offer Insurance Coverage for Users of Crypto Exchanges!
• Venezuela secures Petrocoin with Oil Reserves!
• Digmine malware spread via Facebook Messenger!
• Bitwala will implement SegWit!
• Blockchain is about to revolutionize International Trade!
• Israel wants to emit its own Crypto-Shekel!

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The finance house Mitsubishi Trust and Banking is currently working on a solution to offer users of crypto exchanges an insurance policy, which are used in a hack / crash of the crypto exchange.

That crypto exchanges are popular targets of attack by hackers, is no secret, so that the fear of losing its deposits on the crypto exchanges is very large for many investors. Even though the collapse of the Mt. Gox Exchange has been over three years and the security measures of the crypto exchanges have since improved, there is no guarantee that similar collapses will not happen again.

Accordingly, it makes sense that at the heart of crypto-commerce, Japan, where around 40% of Bitcoin's total trading volume is transacted, solutions are being developed to protect customers' deposits from cyber-attacks. The Mitsubishi UFJ Trust would therefore like to offer its customers to pay for lost cryptocurrencies if it comes to the closure or hack of the exchange platform - for a fee, of course.

To this end, all crypto exchange transactions would be recorded by the bank, so that it is always possible to understand exactly how correct the stock market situation is. Such a connection should exist for the first exchanges in April next year and for the time being only for Bitcoin, as the Nikkei Asian Review reports.

The fact that it is no longer necessary to rely on a crypto exchange or startup, but to enjoy the protection of a large Japanese financial group, will help many investors to overlook the additional fees.

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In the fight against inflation and a looming state bankruptcy, head of state Maduro wants to create a turnaround with Petro. The new cryptocurrency he secured now with the huge oil reserves of the country.

The Venezuelan government wants to secure the new crypto currency Petro with the huge oil reserves of the South American country. President Nicolás Maduro signed a decree on Wednesday, initially claiming five billion barrels of oil (159 liters each) as security for the Petro.

President Nicolás Maduro said:

Overall, the oil-rich country in the world claims reserves of 267 billion barrels. In the future, gold and diamond deposits will also be certified as security for the cryptocurrency.

Considering a galloping inflation and a looming state bankruptcy Maduro had announced in early December, the introduction of Petro. The government wants to regain access to international payments. The world's most famous cryptocurrency is Bitcoin. The digital currency has risen sharply this year, but is also suffering from massive price fluctuations.

With the protection of natural resources of the Venezuelan Petro is according to the estimation of the economist Luis Oliveros actually not a classic cryptocurrency, but rather a simple bond, which is protected by the oil reserves.

The announcement bewildered some followers of cryptocurrencies, which typically are not backed by any government or central banks. Ironically, Venezuela’s currency controls in recent years have spurred a bitcoin fad among tech-savvy Venezuelans looking to bypass controls to obtain dollars or make internet purchases.

Maduro says he is trying to combat a Washington-backed conspiracy to sabotage his government and end socialism in Latin America. He said Venezuela was facing a financial “world war.”

For the millions of Venezuelans plunged into poverty and struggling to eat three meals a day, Maduro’s announcement is unlikely to bring any immediate relief.

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Trend Micro is currently warning of Digmine as a special kind of Christmas greeting. The victims allegedly received a video that was to be hidden in a four-digit archive. In fact, this is an executable file that should install a Chrome extension and then redistribute to all Facebook contacts. The infected PCs are abused to mine the cryptocurrency Monero.

Already in the previous month, I described in detail the means by which cybercriminals try to use the computing power of third-party computers for their own benefit. Not only smartphones are being used with contaminated Android apps for mining. Using a JavaScripts or other malicious software, notebooks and desktop PCs are used without permission to mine Monero. The currently spread all over the world malicious software called Digmine was spread via Facebook Messenger. According to Trend Micro security researchers, the infection started in South Korea, Vietnam, Azerbaijan, Ukraine, the Philippines, Thailand and Venezuela. In the meantime, however, computers from all over the world have been affected by the new wave of infection. The further dissemination only worked if the Chrome users remained permanently on Facebook. As a rule, new extensions of this browser are installed exclusively via the official Chrome Web Store. In this case, a previously unknown vulnerability in Chrome was exploited.

The victims received a private message from their Facebook contacts as a file called video_xxxx.zip, where xxxx stands for any four-digit number. Instead of the Christmas greeting in the form of a video, which are currently widely distributed, hides behind a malicious software for all computers that are operated with the Windows operating system. So far, Trend Micro has not been able to find any variation for Linux distributions or Mac OS X. The functionality of the new malicious software was described for the first time by the South Korean security researcher Constant.

On all smartphones the execution of the file has no consequences. "Digmine" works only in the desktop area and only if the Facebook Messenger has been opened with the Google Chrome browser. After the infection, the program is added to the Windows startup mechanism so that the Monero Miner automatically runs in the background after each Windows startup. For the moment, a further spread is not possible because Facebook has adapted their messenger for security reasons.

Safety first: better ignore offered files from friends

Between the years countless Christmas messages are sent in the form of videos via WhatsApp or Facebook. Since the senders are our contacts, their messages appear trustworthy and lead the recipients to start executables from third parties themselves. This trust has been exploited by cybercriminals at Digmine. It does not have to be a contaminated PDF file or a prepared .exe. For example, malware can also be hidden in Matroska container format with the extension .mkv, .mka, .mks, or .mk3d, which in contrast to Digmine actually plays a video. Of course, this does not change the infection in the background.

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The wallet service provider Bitwala will implement the SegWit. The SegWit is a technical improvement of the Bitcoin blockchain. This should enable cheaper and faster transactions. These should be available to all 60,000 wallet users of the company.

Overview

Segregated Witness (SegWit for short) was activated on August 24 with block 481824 on Bitcoin's Blockchain. The approval for the technical change has since increased sharply.

The SegWit offers two advantages. On the one hand, the limited space on the blockchain is better utilized, thereby reducing the cost of transactions. On the other hand, the SegWit provides a basis for future developments and changes in the Bitcoin network, such as the so-called Lightning Network.

Future Outlook

How much lower transaction costs will be for Bitwala users in the future will become apparent. Currently, the current fees have to be paid as the SegWit still needs to be activated by the company's payment processor. Bitwala plans to complete this upgrade in the first quarter of next year.

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Everyone is talking about the end of the banks. Bitcoin as a new means of payment. In another area, banks have already lost: Trade Finance. Few consumers are aware of trade finance, and it is a huge branch of the financial industry. The global market volume is around $ 3 billion annually. It could be ten times bigger. Only: the banks do not succeed.

Trade finance becomes the link between the digital and the analog world. Every year, we ship more goods around the world than ever before. We import and export huge quantities of goods. The trading partners, such as in the Far East, are often not personally known. Should the supplier first send the goods or pay the recipient? There is uncertainty. So far, banks have acted as trusted intermediaries. Both trading partners turn on their bank, which guarantees the payment. All are happy! Nearly. The service is very expensive and slow. Documents are sent through the world. Each piece of paper wanders through numerous hands. Fast is different.

The first private blockhain for trade finance
The company Brighann Cotton first insured a delivery from Texas to Qingdao (China) in 2016 via a private blockchain. Both parties follow the delivery in real-time. Nobody needs to check more papers to see if the container has really arrived at the port. No paperwork, less uncertainty.

The banks account for many individual steps, which were previously implemented manually by employees. Every step is extremely error-prone. The slightest mistake means in doubt that the guarantee of the bank will lapse.

Cameron Austin, General Manager of Brighann Marketing Inc says:

There are different designs for the blockchain. IBM Research has introduced a private approach in which each participant sees only the bare essentials. Customers are still walking the path of traditional banking. Only the previously necessary documents are omitted.

Some startups experiment with a completely transparent blockchain where everyone can see everything. Sooner or later, banks would no longer be involved in this process.

The advantages are clear: The data are immutable secured, subsequent manipulation is excluded. Documents can no longer be lost or disappear inexplicably. So far, a tiresome problem. All this costs fees, a lot of nerves and especially it costs time.

Regulation slows down innovation

The increasingly strict regulation makes it increasingly difficult for banks to do business. The Basel II and III agreements of the G10 countries promote long-term risks through short-term liabilities. However, Trade Finance often involves financing from a few weeks to months. Trade finance will therefore become less profitable. Naturally, smaller companies lose their market access first. The delivery of a medium-sized company sometimes decides on a successful or loss-making year. Large companies have more market power (require advance payment) and can cope with losses better.

In addition, stricter know-your-customer (KYC) rules make international trade more difficult. Banks need to know and understand their customers and their business model. This applies to private customers, companies and partner banks. KYC should stop terrorist financing and money laundering. The effort for this has recently increased sharply. The new Anti-Money Laundering Directive of the European Union is now intended to extend these rules to cryptocurrencies.

Critical is it in large countries such as Iran and Russia, which are occupied by several international sanctions. Trade is not generally prohibited, but limited. What is allowed, what is forbidden, is like a minefield. Nobody knows if it will be tomorrow what has been agreed today. Many banks are waving to avoid sensitive fines. This hurts companies who would like to send legal products. Your house bank can not support you.

An open system is good for the trade

An independent distributed ledger system would be neutral. Everyone gets access and can negotiate the conditions individually with his contractual partner. Low costs enable even small businesses to insure and export their goods. Lower entry barriers (especially low costs) allow a variety of companies to make their export safer. Thus, the market volume of Trade Finance is growing enormously.

The rapid development of the Internet of Things enables better tracking of global shipping and quality monitoring. When distance is too long and confidence in action is not always enough, transparency is the best alternative.

There are still many hurdles to overcome. The banks fear losing a billion dollar business. Young startups have a hard time pushing into the foreclosed market. Regulation does not help them get started yet. Too many open question marks and uncertainties are in the room. But the first step has already been taken.

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Currently one hears from the side of the Israeli Ministry of Finance, that they want to issue in 2018 in cooperation with the local central bank its own cryptocurrency. The Crypto-Shekel is intended to curb the Bitcoin hype and help fight the country's black market. In January, however, the plans must first approve the majority of Knesset MPs.

An anonymous Finance Ministry spokesman told Jerusalem Post on Sunday that transactions are to be conducted with their own smartphone app. Both money laundering and tax evasion should be combated with it. It is currently unclear whether the wallets should be stored on the servers of the central bank or decentrally on the owners' smartphones. The spokesman for the Israeli central bank rejected any comments in this respect. Wallet service provider Colu, based in Tel Aviv, will also be part of talks with the Israeli government. Its vice-president, Mark Smargon, told Cointelegraph that they would like to be part of the new vision as soon as the initiative becomes reality.

According to the media, the state regulators have been discussing the framework conditions for several months to emit their own Crypto-Shekel. The relevant draft legislation will be published in January next year and its validity will be reviewed. The digital shekel should have the same value as the paper currency. With the help of the new cryptocurrency, immediate credits should be possible for the recipient. With conventional transfers, the credit on the current account of the recipient leaves several days in the future. The government in Jerusalem hopes to contain the run of the Israeli people in other cryptocurrencies. Above all, one wants to regain control over all transactions in order to understand them in detail. The goal is to limit the country's black market. At present, the black market in Israel accounts for up to 22 percent of the country's gross domestic product. According to estimates, the tax authorities are expected to avoid the equivalent of nearly 13 billion euros in taxes each year.

Israeli media agree that the central bank may regard the unregulated cryptocurrencies as a competitor and because of the lack of control, even as a threat. An own digital currency would therefore be an attempt to get hold of this competition. Ultra-Orthodox members of the Knesset demanded two years ago that they should greatly reduce the use of cash in the country. Although many residents have problems opening their own current account. On the other hand, cash promotes the black market and tax evasion, because official bodies can no longer follow the trail of money in cash payments. The payment of any salary in cash, however, should not be legalized. It seeks to guarantee compliance with minimum wages and avoid further tax evasion.

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I wish you all a lovely Thursday!!!
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@danyelk