Coinone Ordered to Compensate Client Loss From Hack

The decision of the Seoul District court may be really considered as a landmark
02 October 2019   334

Seoul District Court ordered Coinone bitcoin exchange to partially compensate the client for the amount of about $ 50,000, whose account was hacked by hackers. It is reported by the local edition of IT Chosun.

The affected client has been trading on the exchange since April 2017. As of November 2018, its deposits were estimated at about 58 million won ($ 48.3 thousand). However, on December 23, as a result of an account hack, his assets were almost completely stolen.

The hacker, using the Dutch IP address, gained access to the account, bought bitcoins and withdrew them from the exchange. The victim’s account has less than $ 5 left.

The client through the court demanded that Coinone compensate for losses of 58 million won, stating that the exchange was obliged to block transactions from foreign IP addresses. In addition, the amount of cryptocurrency transferred by a hacker exceeded the daily withdrawal limit set by the financial regulator of South Korea at $ 20 million, the plaintiff said.

The court agreed with part of Coinone's counterargument. He did not find the exchange guilty of account hacking and admitted that the site should not block foreign IP addresses.

At the same time, the court decided that Coinone is required to comply with the withdrawal limit, since the restriction is set not only to prevent money laundering, but also to protect customers from disruptions to the exchange. The court determined Coinone to pay compensation to the plaintiff at 25 million won.

The court decision creates a rather interesting precedent, despite the fact that the exchange was recognized as partially responsible for the incident, and the amount of compensation was much less than the claimant requested.

ETH May Become Security After POS Migration,- CFTC

At the moment, according to the head of CFTC, Ethereum is more likely an exchange commodity rather than a security, but it may change 
14 November 2019   143

The head of the Commission for derivatives trading (CFTC) Heath Tarbert expressed the opinion that cryptocurrencies involved in the cryptocurrency using the Proof-of-Stake algorithm can be considered as securities. It is reported by Decrypt.

Earlier, the head of the CFTC said that in its current form, Ethereum is more likely an exchange commodity rather than a security. However, I am sure Tarbert, over time, the status of an asset may change. For example, a security can become a commodity and vice versa.

We are thinking carefully about it.
 

Heath Tarbert

Chairman, U.S. Commodity Futures Trading Commission

The popular Proof-of-Stake (PoS) algorithm involves the use of “stake” as a resource that determines which particular node receives the right to mine the next block. Higher chances to generate the next block are received by the node with greater balance.

Recently, staking services that promise customers a return on investment in PoS assets have become popular. According to some experts, these services could potentially violate the provisions of the Howie test, such as having a joint venture, as well as an investment contract involving two parties.

At the same time, Tarbert spoke out against an aggressive approach to regulating cryptocurrencies, which could suppress innovation and hinder the strengthening of the US position in the innovation sphere.

Clarity and consistency is the first step to leadership.
 

Heath Tarbert

Chairman, U.S. Commodity Futures Trading Commission

Earlier, Heath Tarbert expressed the view that regulated futures based on Ethereum will soon appear on the market.