Brazil Watchdog Prohibits Funds from Crypto Investing

Сountry’s regulators are currently working on crypto regulation
15 January 2018   372

The Securities and Exchange Commission of Brazil (CVM) said that local investment funds are prohibited from investing in cryptocurrencies. This is reported by

The corresponding CVM directive is addressed to all employees and official agencies responsible for monitoring the activities of investment funds in the country. The document says that the crypto-currencies are not regarded by the regulator as financial assets, and therefore direct investment in them is prohibited.

Moreover, local funds wishing to invest in the cryptocurrency not directly but through foreign companies are advised not to rush into this and expect further statements by the regulator.

In May last year, the House of Representatives of the National Congress of Brazil created an ad hoc committee to regulate crypto-currencies. During the second half of last year, it held seven public hearings on issues related to digital assets.

In December 2017, CVM and the central bank of Brazil issued a joint statement, which deals with the risks associated with crypto-currencies. In the same month, the representative of the House of Representatives, Expedito Netto, proposed recommendations that, in effect, prohibit cryptotrading, storage, and exchange of digital currency for fiat without official authorization. As punishment to violators, the people's deputy recommended imprisonment for up to six months or a fine. At the same time, Netto did not specify what exactly such a "permit" should be like.

In addition, during the December public hearings, Jonathas Ramalho, Executive Director of Banco do Brasil, spoke in favor of regulating crypto-currency. In his opinion, the creation of rules for circulation of digital money in the country will help create an enabling environment for the development of the blockchain industry.

Bitcoin Gold hit by Malicious Miner`s Double Spend Attack

An evil-minded miner efficiently made a double spend attack on the Bitcoin Gold network, making BTG at least the third altcoin to succumb to a network attack
23 May 2018   123

Edward Iskra, Bitcoin Gold director of communications first admonished clients about the attack on May 18, reporting that an evil-minded miner was using the exploit to steal means from cryptocurrency exchanges.The miner bought at least 51 percent of the network’s total hashpower, which provided them with temporary control of the blockchain. Gaining this much hashpower is extremely expensive — even on a smaller network like bitcoin gold — but it may be monetized in tandem with a double spend attack.

The attacker, after getting the control of the network, started depositing BTG at crypto  exchanges while also intending to send those same coins to a wallet under their control. Generally, the blockchain would resolve this by including only the first transaction in the block, but the attacker managed to reverse transactions as they had majority control of the network.

As a result, they were able to invest funds on exchanges and withdraw them again soon, after which they repealed the initial transaction. This way they could send the coins they had primarily deposited to another wallet. 

An address of bitcoin gold connected with the attack has got more than 388,200 BTG since May 16 (basically from transactions it sent to itself). All of those transactions were associated with the double spend exploit, the attacker could have stolen as much as $18.6 million worth of funds from exchanges. The last transaction was sent on May 18, but the attacker could resume it if they still have access to enough hashpower to reach the control of the blockchain.

Bitcoin gold’s developers recommended exchanges to resist the attack by reaching the number of confirmations acquired before they lended deposits to client accounts. Blockchain data displays that the attacker reversed transactions as far back as 22 blocks, allowing developers to advise raising confirmation requirements to 50 blocks.