Superforecasting cryptocurrencies: Week 6 Day 4: ... must come down

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4 October 2017

The most significant development seems to be the drop in the Bitcoin Cash price: more than 20% over seven days. Once again, the Korean trading seems to have dominated performances, particularly giving Ripple a 10% boost on the day.

[Commentary delayed because of computer problems]

Crypto developments

While the daytraders continue to take their profits, here are some more crypto events of previous days to savour:

Chinese BTC exchange denies $3m hack

Cecille De Jesus of coingeek.com reported on 3 October, under the headline "Suspicions rise as Chinese BTC exchange denies $3m hack":

Towards the end of August, a user reportedly lost 200 bitcoins, then valued at around $750,000, through Chinese bitcoin company OKCoin’s exchange arm, OKEx. According to the report, a German IP logged into his account and traded all the bitcoins to ETC (ethereum classic), enabling the hacker to easily withdraw all the funds within an hour.

A few other reports of a similar attack emerged from users of both OKEx and OKCoin, with the overall loss amounting to a total of around 600 bitcoins (around $2.6 million).

OKCoin, once the world’s largest bitcoin exchange, asserted that the thefts had nothing to do with the platform, and suggested that all the hacked accounts may have simply fallen victim to phishing scams, viruses, or other security breaches, and “got their passwords stolen.”

She comments:

OKCoin’s dismissive stance, however, is failing to put out the fire. Rumors are starting to rise as more news outlets online pick up the story, with some even speculating whether it was an inside job perpetrated by the exchange itself, seeing as China’s recent crackdown on cryptocurrency exchanges means legal action would be unlikely, as all cryptocurrency exchanges in the country have been shut down. Victims were told to report the theft to the police themselves. The police, on the other hand, refuse to entertain the cases since the ban.

This isn’t the only problem OKCoin has been facing in the past few months. Earlier in August, an investigation by the People’s Bank of China questioned OKCoin and Huobi, China’s two biggest bitcoin exchanges, regarding their decision to use $150 million of idle client funds to invest in “wealth management products.” In response, OKCoin released a statement denying any wrongdoing: “We are, of course, prohibited from using our client’s fund for our own gain, and do not do so.”

Snowden says

Security whistleblower Edward Snowden took to Twitter to give his opinion of cryptocurrencies, reports cointelegraph on 29 September.

Not surprisingly, he is concerned with the security of transactions in the crypto universe.

As Chrisjan Pauw reports it:

On Twitter, a user @masonic_tweets remarked, “Zcash is the only altcoin (that I know of) designed and built by professional and academic cryptographers. Hard to ignore.”

Snowden comments: “Agree. Zcash's privacy tech makes it the most interesting Bitcoin alternative. Bitcoin is great, but "if it's not private, it's not safe."

He also commented on Monero, a supposedly untraceable cryptocurrency that contain privacy mechanisms, but which reported a bug earlier this year.

A statement from developers on the bug read, “it allows for the creation of an unlimited number of coins in a way that is undetectable to an observer unless they know about the fatal flaw and can search for it.”

Snowden replied that Monero is a “great project” pointing out that “the problem with amateur crypto is mistakes happen and have huge consequences for people like me.”

This is also in reference to findings published on MoneroLink that suggest as much as 60 percent of Monero transactions can be linked, meaning that transactions are not as anon ymous as users would have initially hoped.

CDC Considering Blockchain for Crisis Data Management

Mike Orcutt of MIT Technology Review was the source of this story on dcebrief on 3 October.

The U.S. Centers for Disease Control and Prevention (CDC) is reportedly exploring the potential benefits of using blockchain technology for medical data management.

When the CDC responds to health emergencies, they work with state and local officials to identify and isolate any potential disease outbreaks. That requires relevant agencies and health care entities to share data as quickly and efficiently as possible. During any actual outbreak of infectious disease, there is little time to waste. Unfortunately, the current data-sharing systems do not allow for the secure and speedy input and sharing of information needed to respond in the most effective and time-efficient manner possible.

According to a report from MIT Technology Today, the CDC Center for Surveillance, Epidemiology, and Laboratory Services chief software architect, Jim Nasr, sees blockchain technology as a likely solution for these challenges.

The US Treasury Is Testing Distributed Ledger Asset Tracking

This from altcointoday on 3 October:

A major agency within the US Department of the Treasury is planning to track the movement of smart phones, computers and other office assets in a new blockchain pilot project.

The Bureau of the Fiscal Service’s Office of Financial Innovation and Transformation (FIT) said yesterday that it has hired an as-yet-unnamed contractor to build a prototype system in order to “track and manage physical assets (for example, computers, cell phones, and the like).” Formed in 2012 through the merger of two separate agencies, the bureau is chiefly responsible for borrowing money to fund the government as well as handling interagency payments and accounting.