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Bitfinex Users Can Use Bitcoin Lightning Network to Shop

  • Bitfinex has announced a partnership with Bitrefill, allowing users to instantly buy goods and services with Bitcoin

Only days after Bitfinex announced that it had become the first major crypto exchange to integrate the Lightning Network, which facilitates instant deposits and withdraws for practically zero fees, Bitfinex has announced that it has partnered up with Bitrefill so that users can instantly buy goods and services.

Essentially, Bitfinex users can now use their wallets to shop Bitrefill’s catalog of 2,000 pre-paid gift cards and vouchers, which includes gaming, dining, entertainment, travel, and cell phone refills for 170 countries. Payments between Bitfinex and Bitrefill will occur instantly via the Lightning Network.

This is a positive step for Bitcoin adoption and may offer a glimpse of how Bitcoin commerce will work in the future. In the same way that banks give customers different tools to shop with fiat, crypto exchanges can give customers tools to shop with cryptocurrency. The Lightning Network is perfect for retail and e-commerce sales too, since there is no waiting and practically no fees.

Indeed, Bitfinex CTO Paolo Ardoino says, “Bitcoin’s use as a means of payment represents an important milestone in the inevitable journey towards mass adoption. This is why the Lightning Network is so important”. Thus, the partnership between Bitfinex and Bitrefill was created with mass crypto adoption in mind.

 

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Bitfinex First Major Crypto Exchange to Integrate Lightning Network

  • Bitfinex has become the first major cryptocurrency exchange to integrate the Lightning Network, facilitating instant deposits and withdraws
  • Capacities are 1.5 BTC for withdrawals and 3.5 BTC for deposits

Bitfinex has announced that they are now running a full Lightning Network node, which allows customers to open up payment channels for instant deposits and withdraws while paying practically zero transaction fees. This makes Bitfinex the first major crypto exchange to integrate the Lightning Network.

The Lightning Network is a second-layer scalability solution for Bitcoin that bypasses the blockchain, which means that no block confirmations are needed. Blockchain transactions are only needed to open and close a Lightning payment channel. This is much more efficient than the regular situation on crypto exchanges where Bitcoin deposits require 1-6 confirmations, which take 10 to 60 minutes on average, but can take hours or over a day during times of network congestion. Also, regular Bitcoin transactions can have significant transaction fees.

Now with Lightning Network customers can instantly deposit or withdraw Bitcoin, creating a much more favorable situation for traders who are trying to conduct arbitrage or buy crypto at a certain price. Oftentimes, market prices fluctuate while a Bitcoin deposit is confirming, which can cause a trader to miss opportunities.

Also, the main caveat of the Lightning Network is that payment channels have low capacity, typically less than USD 600, but Bitfinex has a fairly high capacity of 3.5 Bitcoins for deposits and 1.5 Bitcoins for withdraws.

This is a major step for global Lightning Network adoption, and Bitcoin adoption as well, since the Lightning Network makes it possible to use Bitcoin for instant payments in a retail environment, as opposed to regular Bitcoin payments where confirmations can take too long.

 

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Battle Between Bitfinex and New York AG Office Continues

Bitfinex and Tether Limited have been in a court battle with the New York Attorney General’s Office since April. Allegedly, Bitfinex lost access to USD850 million of funds when Crypto Capital was raided by the government for money laundering. Due to banking issues, Bitfinex and Tether Limited had been using Crypto Capital as a pseudo-bank. Following the seizure of USD 850 million Bitfinex allegedly took the money out of Tether’s reserves and opened a USD 900 million line of credit to fill the gap.

The most recent news is that Bitfinex and Tether Limited do not have to produce documents pertaining to the loss of the USD 850 million nor OF the USD 900 million line of credit until a stay granted this summer expires in early November. This can be seen as a minor victory for Bitfinex and Tether Limited, although when the stay expires in about a month, the documents might have to be produced.

On the flip side of the coin, a 90-day injunction preventing Tether Limited from loaning any more funds to Bitfinex has also been issued, which can be seen as a minor win for the New York Attorney General’s Office.

It will be important to follow this case once the stay expires in November since any actions taken against Bitfinex and Tether Limited could have significant impacts on the crypto market.

 

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Bitcoin Consolidation Stutters, US Traders Take Stock

Bitcoin Consolidation Stutters, US Traders Take Stock

The weekend rally that many Bitcoin bulls were hoping to show up has so far failed to happen, and with only the US market now left to move the price on Sunday, emerging news related to American Bitcoin traders might just be enough to put them on alert.

After yesterday’s move just above USD 10,000, bears were held at arm’s length but only for several hours. At 9:45 pm UTC, as Bitcoin made its daily high at USD 10,089, price inexplicably crashed to USD 9,513, after which it traded in an extremely narrow range until now, going to a low of USD 9,306 but now at USD 9,489 at 8:50 am UTC (CoinDesk).

The 5% drop, after the 5% rise yesterday, will be seen as a blow to bull’s hopes for some consolation during a somewhat disappointing July. There are still three days left of course, and anything could happen in this volatile market to affect sentiment, but for now, the mood is distinctly turning to a bearish one for the immediate short term of one to two months.

The whisperings of US government contractions onto Bitcoin and other cryptocurrency have been seen as good news for Bitcoin in the long term by commentators such as Pompliano, as we have been explaining in recent analyses, but for the time being, the mainstream mood is one of fear and paranoia.

As US regulators continue to push exchanges in other jurisdictions to ensure that American nationals are not allowed onto the platform, US traders who used to be able to trade online virtually anywhere are now facing concerted blocks from the major exchanges with big volumes such as Bittrex and Binance. However, since these blocks are mainly technical, from a mere blanket blocking of US IPs, a simple fix can be for traders to access via VPNs or proxies, masking their true locations. Since these exchanges also allow a significantly high daily trading limit for unverified accounts — for Binance, non-verified accounts can withdraw 2 BTC or about USD 19,000 per day, for example — then American traders can still skip around these limits quite easily.

The long arm of US law is reaching out to try and ensure exchanges stamp out these errant citizens, with major platform Bitfinex now being accused of flouting regulations by allowing US users to access their platform to trade. Bitfinex insists that it is “trying super hard” to stop this from happening, according to a report today on Yahoo Finance.

In an attempt to be transparent, Bitfinex made an official announcement admitting that one trader had managed to bypass its restrictions. In their blog post, they explained how they were tricked and lied to by the alleged New-York based user with “this kind of ‘gotcha’ sting” showing “his and our other detractors’ true motivations”:

“We have now identified this user. We correctly flagged this user’s IP address as being in the US. Notwithstanding the US IP address — which may be used by Bitfinex customers, as appropriate — our system logs demonstrate that this user represented to us several times that he was not an individual resident in the US. This person has lied to Bitfinex on multiple occasions, deliberately and wrongly concealed his location, and flagrantly violated our terms of service.”

Will Bitfinex’s statement release them from every wrongdoing? Perhaps if they can demonstrate that they did their best to prevent it, but that’s a matter for the courts to decide, should the US pursue litigation against Bitfinex.

Nevertheless, this development may not force exchanges all around the world, especially those who allow unverified users to trade on their platform, to implement more aggressive measures to stonewall US traders from even being able to create an account.

At the same time, Yahoo also published an article it calls a Public Service Announcement, warning online Bitcoin traders that the US tax agency, Internal Revenue Service (IRS) is now increasing its monitoring of Bitcoin trades and under-reported tax obligations related to the trading of cryptocurrency.

Apparently, IRS is now pushing out “an avalanche of notices” to over 10,000 crypto investors suspected to have not been fully transparent about their crypto tax reporting. The mail campaign has been dubbed as resembling a “scattergun” approach by Forbes, although hints that IRS could actually be most interested in any Coinbase accounts with a transaction history exceeding USD 20,000.

But CCN believes that this could actually be a good thing in the end, as the IRS and the US government might see that with Bitcoin’s transparency and traceability on a public blockchain, tax monitoring and reporting could actually be facilitated, and not hindered, by crypto.

So are we back at full circle again when it comes to states’ approaches to Bitcoin, starting with suspicion first and then ending with acceptance? That seems to be the plot.

 

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Tether Prints $100 Million Since Friday

Tether Prints 0 Million Since Friday

After a huge run up to USD 13,800 and the flash crash on Thursday, nothing says volatile the way Bitcoin has. And now, as the world’s most traded crypto seemingly enters into a phase of consolidation, Tether continues to pump out more of its USDT into the market, adding USD 100 million since Friday.

Tether’s market capitalization has always been a point of contention in the crypto community, growing ever since its inception, with its latest addition now bloating to a total of USD 3.6 billion. As usual, this has prompted a lot of noise in the industry.

It began with Twitter user “Giancarlo The Tether Whisperer” posting an update on his feed:

Yesterday there were 36 million ETH Tethers in the Treasury. Today 19 million.

At this rate expect an ETH Tether print or a large-scale transfer of OMNI Tethers to ETH in the next 1-3 days. pic.twitter.com/weBTkqtgfa

— Giancarlo The Tether Whisperer (@CasPiancey) June 30, 2019

Tether volume had reached an all-time high of USD 40 billion plus on the same day as Bitcoin’s 2019 high, and remains the largest stablecoin in use, by far. Circle’s USDC lags far behind at a USD 366 million market cap, a measly 10% of Tether, which has only increased by 80% since April.

Many reports say that whenever more Tether enters the market, the price of Bitcoin tends to spike shortly after, leading to many saying that its issuer is one of those behind the price manipulation. A 66-page thesis published in 2018 by the University of Texas Austin, seemed to give evidence on this correlation, claiming that the 2017 crypto bull was artificially created with freshly printed Tether.

A recent blog post titled ‘Welcome to Bitfinex’s Second Tether Bubble’ has similarly noted the premiums on different exchanges using stablecoins and USD, and how they have risen and fallen dramatically on Bitfinex, who gave birth to Tether.

True or false? The mystery can only deepen.

 

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Bitcoin Flash Crash Cripples Coinbase as Exchanges Strain Under Pressure

Bitcoin Flash Crash Cripples Coinbase as Exchanges Strain Under Pressure

A widespread flash crash of Bitcoin price that took place yesterday — reported earlier in our BitcoinNews.com daily market sentiment analysis — had apparently had an effect on traders across several major crypto exchanges, including Coinbase, Binance, Bitfinex and Deribit.

The sudden dip in price led to these traders unable to access their accounts, although those on platforms like PrimeXBT were able to take advantage of the situation as others scrambled.

Having risen over 250% in just a few weeks, Bitcoin is touted by many analysts to be in a full swing of bullish and parabolic patterns, looking to emulate the last huge run in late 2017 that resulted in skyrocketing demand across the world, pushing prices to above global averages in markets where supply simply could not keep up

This recent crash was just a sample of things to come, with Coinbase unable to be accessed by many traders and even Binance, considered by many to be the largest outside of North America, caused some issues for people.

Irate traders took to social media, as usual, to vent their frustrations, when Bitcoin suddenly dipped around 2:00 pm EDT wiping out all the gains from the past 24 hours and then some. Traders began reporting that Coinbase, Binance, BitMEX and Bitfinex, among others were inaccessible.

Of course, many resorted to old theories of Tether and Bitcoin manipulation, with some taking a dig at the stablecoin linked to many a Bitcoin price scandal:

Relax guys, it’s just Bitfinex cashing out on Coinbase 🤣

— Gal Tesler (@galtesler) June 27, 2019

Whether or not there is “something fishy” going on with how all these platforms crashed for a while, there can be no doubt that FOMO season is here now. Just what it will do to Bitcoin’s price is anyone’s guess.

Anyone think theres something fishy about the fact that Coinbase, Bitrue, Bitfinex, etc. Go down during a huge parabolic move? We saw “overloading” and other excuses during Bitcoin Cash listings. And Binance going down for hacks, etc. Can’t help but feel like they’re all

— DM SPQR (@distributedmind) June 26, 2019

 

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Bitfinex Buy Back Will Be “Super-Transparent”

Bitfinex Buy Back Will Be _Super-Transparent_

One of the world’s most famous — some would say infamous — crypto exchanges, Bitfinex, has now announced that it plans to buy back its own native token, LEO, for gradual burning. What’s more, it will be “super-transparent”.

Buy back and burns are generally what a centralized token project will do to reduce the circulating supply, and therefore, add to the token’s scarcity. This is expected to improve the valuation of the token.

Bitfinex’s UNUS SED LEO Transparency Initiative, it claims, will show users iFinex (the parent company of Bitfinex) and all its LEO purchases at current markets rates. Statistics will be updated every hour to show that buy backs would happen with a minimum of 27% of the consolidated revenues of iFinex.

Users on social media have naturally questioned this move, wondering if the transparency can really be as forthcoming as all that. However, Bitfinex CTO Paolo Ardoino was not afraid to address this burning question, saying on Twitter:

1/3 🦁
Just got this question: how Unus Sed $LEO holders and wanna-be holders can check if @bitfinex will use really 27% of its revenues to buy back LEO.
To play the devil advocate imagine we could:

— Paolo Ardoino (@paoloardoino) June 19, 2019

Ardoino suggests in the next series of Tweets that if Bitfinex were malicious, it could choose to report a lower volume, so that they would need to buy back fewer LEO tokens. But this would need them to explain to traders why their activities are not reported in a public feed. He also said that they could go the opposite direction and report fake volumes, but this would then commit more funds from their reserves to buy back LEO, leading to an unsustainable future.

He ends the personal reflection by saying:

“So in my opinion our buy back mechanisms is super-transparent and protective of LEO holders. That is why I claimed we made an unprecedented move among exchanges. Now our revenues are under everyone’s eyes.”

Does this mean Bitfinex would be the first exchange to make good on its promise to be “super-transparent”? It would be unprecedented for sure, but is super transparency possible for any centralized exchange? Time will tell.

 

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Blockpass to Provide KYC Verification for Bitfinex’s New IEO Platform

Blockpass, a blockchain identity protocol has announced that it will provide KYC and AML authentication services for the upcoming Ampleforth IEO conducted on the Tokinex platform.

Tokinex is an Initial Exchange Offering (IEO) platform which was presented by parent companies, Bitfinex and Ethfinex last month. It allows users to participate in pre-vetted token sales from the various ventures within the crypto industry. The platform has been tailored keeping user experience in account in order to deliver a simple and reliable contribution process.

 

Blockpass announces identity verification services for Ampleforth IEO on tokinex

Ampleforth is a unique digital asset protocol for ‘smart commodity-money’. It uses trusted oracles to obtain exchange-rate information and makes it available to holders of its units by a relevant increase or decrease in the tokens held by them. The AMPL supply alters in accordance with the price deviation from a USD 1 target.

The IEO is scheduled to run from 13 to 19 June 2019, aiming to reach USD 4.9 million.

Henry Child, Commercial Strategy at Tokinex and Ethfinex, said:

“Tokinex is proud to partner with Blockpass, this demonstrates both platform’s commitments to data privacy and user experience. Blockpass is leading the way in data sovereign verification and we are delighted to deliver this solution to the IEO space.”

Blockpass is a production-ready Regtech platform which aids in verification of humans (KYC), objects (KYO) and connected devices (KYD). Blockpass enables the development of new applications that depend on trusted relations between the various entities.

The CEO of Blockpass, Adam Vaziri said:

“The beauty of using the Blockpass App for identity verification during the customer onboarding process is how quick and easy it really is.”

He further stated:

“For customers who already have a Blockpass identity, they simply scan the QR code and click submit, and the company receives all their documents, pre-vetted and ready to go. This IEO is a perfect use case for our platform, taking the pain out of signing up to this great new service, Tokinex.”

Previously, Blockpass had collaborated with the parent company of Tokinex, Ethfinex and provided identity verification services to many ICOs hosted by the company. In May, Blockpass announced a partnership with Waves to ensure straightforward and transparent tools for business. Some of the other partnerships of Blockpass in 2019 include Tokenomica and the BBFTAEmploying RegTech solutions to improve AML/KYC has proven to be a smart strategy, limiting the problems while protecting all societal interests.

IEO stakeholders have to register on a certain exchange and complete KYC/AML procedures.

Other services similar to Blockpass include Daonomic, which provides self-service KYC forms for KYC/AML verification. There is also a partnership between the crypto exchange Binance and risk-management firm IdentityMind to enhance KYC/AML verification.

 

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Bitfinex Assures Users All Secure After Deposits and Withdrawals Shutdown

bitfinex

Crypto exchange Bitfinex has assured its users that all is well after temporarily shutting down deposits and withdrawals according to a Tweet.

The shutdown was described by Bitfinex as being necessary “due to the outage of one of [their] network providers,” and although services had been suspended, the platform made it clear that all funds were in safe storage.

. @bitfinex : due to the outage of one of our network providers we temporarily paused deposits and withdrawals. Funds are safe in cold storage. Situation should be restored ASAP. Apologies for inconvenience.

— Paolo Ardoino (@paoloardoino) May 31, 2019

However, this is not what users probably wanted to hear in light of recent headlines concerning the company. The exchange allegedly attempted to cover missing funds totaling USD 850 million by raiding its Tether reserves in order to pay out customers. Between May 2015 and August 2016, Bitfinex was reportedly attacked by hackers who stole BTC 1,500 in 2015 and USD 72 million worth of Bitcoin in 2016.

Bitfinex had its Bitcoin data removed from CoinMarketCap’s price average earlier this month due to a 5.5% premium the exchange claims over the market average, which was thought to be the result of recent events.

However, users would be hoping that the shutdown was simply a hiccup and not something with more complex overtones. Bitfinex has now presented a motion to dismiss the charges against them entirely. According to the exchange, a subsequent hearing has been scheduled on the motion for 29 July 2019.

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How the ICO Market Has Been Regaining Investor Faith

How the ICO Market Has Been Regaining Investor Faith

In 2018, funds raised from initial coin offerings (ICOs) fell dramatically from over USD 1 and a half billion in January, to under USD 75 million in December.

However, new data showing the activities of the month of May so far indicates that investor faith has begun to regain strength in the light of increasingly highly-rated ICO projects, with 85% of the total projects receiving a high rating between 3-3.5 stars. This is a significant increase, even from April 2019 which claimed an average of just 68% of projects gaining this trusted star rating.

As many viewed ICOs and similar token events as a groundbreaking new way to fund startup projects in the blockchain space, the slow fizzle out of popularity last year was highly disappointing. It seemed to be that these token offerings had collapsed under the weight of up to 80% scam projects flooding the market, as well as crashing prices across nearly all cryptocurrency.

ICO bench data shows that 157 ICOs have been launched in May so far, expanding the total number of published projects to 5,512. There are currently 287 ongoing ICOS, with a further 140 expected in the near future.

A summary of the ICObench ICO Market Half-Monthly Analysis May 2019 report can be accessed for free with a trial subscription on the platform.

Moving away from the established model

Trends away from the established ICO model are likely in reaction to the poor quality and trust standards that became prominent amongst ICOs, beginning in 2017.

The month of May 2019 has so far been overwhelmed by Bitfinex’s USD 1 billion initial exchange offering (IEO) — a relatively new model available to investors where they can participate in a centralized cryptocurrency exchange’s token offering. The exchange involved operates the sales, vetting both the project and prospective investors.

Bitfinex’s IEO has contributed significantly towards this month’s roughly USD 1.075 billion collected in token sales — the highest total funds raised in 2019 to date.

This year has also seen a rise in popularity of security token offerings (STOs). STOs claim to offer a more trusted model than the ICO as the security token issued to investors represents an investment contract, acting similar to ownership information given to investors in the stocks or bonds, just recorded on the blockchain via the token instead.

STOs can be seen as a lower risk than ICOs because they are protected by securities laws that the tokens must comply with, legally enforcing transparency and accountability from the project behind the token.

STOs raised USD 1 and a half million in March 2019; this figure jumps up to over USD 5 and a half million in May so far.

Indeed, because active ICOs have a higher average trust rating than one year ago, it enforces greater trust in investments made across the cryptocurrency market.

The move towards alternative token investment models such as STOs and IEOs could certainly be one reason investors are regaining trust in early blockchain project investment. However, May’s bullish market performance could certainly have also had a great impact on the number of investors willing to participate in token offerings.

 

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