UK Watchdog to Approve First Crypto Hedge Fund

Now Prime Factor Capital will be able to manage assets of more than 100 million euros worth
03 July 2019   1807

London-based hedge fund Prime Factor Capital has become the first cryptocurrency investment firm to be approved by the UK Financial Supervision Authority, Bloomberg reports.

The company will be regulated by the British financial regulator as a full-fledged manager of an alternative investment fund, and will also be subject to the laws of the European Union.

Thus, Prime Factor Capital will be able to hold assets of more than 100 million euros under management.

As reported by Coindesk, the founders believe that by focusing on a single asset class, even one that carries market distrust, they will surge ahead of their global competitors and become the trusted authority in crypto investing.

Also, according to European regulations, Prime Factor Capital should hire an independent custodian who will be entrusted with the task of controlling the payment of income to investors and the assets of the fund.

The company was founded in early 2018 by Michael Wong and Adam Grimsley, in the past the leading portfolio managers of the BlackRock Inc. investment fund. The position of executive director of Prime Factor Capital is held by Nick Nidermovve, a former trader of RWE AG in the market of energy derivatives.

Potentional Vulnerabilities Found in ETH 2.0

Least Authority have found potentional security issues in the network P2P interaction and block proposal system
26 March 2020   964

Technology security firm Least Authority, at the request of the Ethereum Foundation, conducted an audit of the Ethereum 2.0 specifications and identified several potential vulnerabilities at once.

Least Authority said that developers need to solve problems with vulnerabilities in the network layer of peer-to-peer (P2P) interaction, as well as in the block proposal system. At the same time, the auditor noted that the specifications are "very well thought out and competent."

However, at the moment there is no large ecosystem based on PoS and using sharding in the world, so it is impossible to accurately assess the prospects for system stability.
Also, information security experts emphasized that the specifications did not pay enough attention to the description of the P2P network level and the system of records about Ethereum nodes. Vulnerability risks are also observed in the block proposal system and the messaging system between nodes.

Experts said that in the blockchains running on PoS, the choice of a new block is simple and no one can predict who will get the new block. In PoS systems, it is the block proposal system that decides whose block will fall into the blockchain, and this leads to the risk of data leakage. To solve the problem, auditors suggested using the mechanism of "Single Secret Leader Election" (SSLE).

As for the peer-to-peer exchange system, there is a danger of spam. There is no centralized node in the system that would evaluate the actions of other nodes, so a “malicious" node can spam the entire network with various messages without any special punishment. The solution to this problem may be to use special protocols for exchanging messages between nodes.