Congress Slams IRS Over Bitcoin Tax Law; Here’s the Major Loophole for Crypto Investors

The United States tax deadline has came and went, and thanks to overwhelmingly confusing tax laws, crypto and Bitcoin investors are left scratching their heads, with many outright refusing to report their crypto earnings and losses on their annual tax filing.
It’s not U.S. taxpayers who are alone in feeling confused by the complex tax laws and lack of clear guidance. Congress has issued a scathing letter to the Internal Revenue Service (IRS) asking for clarity on how U.S. residents should go about paying their taxes on Bitcoin and other cryptocurrencies. The letter itself, suggests a leading tax attorney with experience in advising crypto clients, creates a major loophole for crypto investors who are at risk to become audited or worse.
Congress Issues Letter to IRS Requesting Bitcoin Tax Clarity
Tax day in the United States was this past Monday – a day many U.S. taxpayers dread. Tax laws in the country are already complicated, and confusing, requiring many taxpayers to either invest in software or pay a tax advisor to help guide them through the process and ensure all gains and losses are accurately reported.
Related Reading | Overwhelming Majority of Bitcoin and Crypto Investors Refuse to Report Taxes
The confusion is significantly amplified when you take into account an emerging asset class that is not fully understood, is unregulated, and has a multitude of potential use cases that walk the line of different classifications. Making matters worse, the IRS has only issued one public notice back in 2014 on how to pay taxes on cryptocurrencies such as Bitcoin since its inception, yet carries fines of up to $500,000 and up to five years in prison if taxes aren’t reported properly.
The glaring issue has prompted Congress to issue a letter to the IRS, demanding answers for U.S. taxpayers who are lost on how to report crypto-related transactions on their taxes.
“Taxpayers deserve clarity on several basic unanswered questions regarding federal taxation of these emerging exchanges of value,” the letter read. “Guidance is long overdue and essential to proper reporting of these emerging assets. The bipartisan support this letter has received should send a clear message to the IRS that clear guidelines for reporting virtual currency are necessary,” added Minnesota Congressman Tom Emmer.

Letter Inadvertently Provides Major Loophole for Crypto Investors
The letter itself Congress sent to the IRS, may further complicate things for the U.S. government, according to San Francisco-based tax lawyer Alex Kugelman who is familiar with advising cryptocurrency clients. Kugelman says that the letter could act as a sort of protection for any crypto investors that may have been targeted by the IRS’s crackdown on crypto tax evaders.
Related Reading | Confusing U.S. Tax Laws Lead to $5 Billion In Unrealized Crypto Losses
Kugelman explained that “if any of my clients are audited, I am going to present this to auditors – how can the IRS take enforcement action against taxpayers when there is such an obvious lack of guidance?”
With fines as steep as $500,000 and charges that could lead to up to five years in prison, having this added layer of protection on what is a complex and confusing situation, can be an ace up the sleeve for crypto investors or traders who find themselves in a precarious situation with the IRS.
Disclaimer: This information should not be taken as tax advice. Seek a certified public accountant for any crypto tax related questions.
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Petro and Venezuela: The arrival of United States and the South American country’s crumbling economy

This is Part 2 of our article on Petro and Venezuela.
As discussed in Part 1 of the article, the launch of Petro in Venezuela created a massive wave of apprehension among the world community, with many leaders condemning the Nicolas Maduro government for launching a cryptocurrency over focusing on improving the country’s failing economy. The United States was not far behind either, and has been heavily involved in Venezuela recently. This article looks at the steps taken by the US to oversee and check Venezuela, as well as the current scenario in the financially ravaged South American country.
The United States Point of View
Venezuela and the US have had a tumultuous relationship in the past, with the first clear line of animosity drawn in 2015 when the then-President Barack Obama signed sanctions halting crude exports from within Venezuela. This decision formed the backbone of Nicolas Maduro’s animosity towards the US, with the South American country making it clear at the World Trade Organization that the sanctions against it were ‘discriminatory’.
Obama’s successor, Donald Trump, has widened the chasm between the two countries by backing Juan Guaido, the leader of the Venezuelan Opposition party. Guaido also received support from other countries like Canada and Germany, forcing Maduro to speculate about a grand coup orchestrated by the world’s most powerful nations. The sheer amount of opposition did not stop the Venezuelan government from boosting its Petro prowess though, as the government established its own cryptocurrency regulatory authority called Sunacrip.
Since its inception, Sunacrip has released multiple decrees and articles to integrate Petro into the workings of the Venezuelan economy. One of the official decrees from Sunacrip says,
“The sender of the remittances referred to in this ruling is obliged to pay a financial commission in favor of Sunacrip up to a maximum amount of 15% calculated on the total of the remittance.”
The developments around Petro peaked on 11 March, 2019, when the US government reportedly discovered that there were Russian links in money transfers to Venezuela. Evrofinance Morasbank, a bank jointly owned by Russian and Venezuelan state entities, had assisted and provided support for the PDSA, said the United States Treasury. Steen Munchin, the United States’ Treasury Secretary, had said,
“The United States will take action against foreign financial institutions that sustain the illegitimate Maduro regime and contribute to the economic collapse and humanitarian crisis plaguing the people of Venezuela.”
The bank did not retaliate to the comments made by the Treasury, promising to continue working for its clients. However, Russia made a strong statement, stating that it will fund the bank if the US continues its clampdown.
Venezuela right now
With the intervention of multiple countries into the grand scheme of things, it is hard to ignore who the real victims are: the people of Venezuela. They were supposed to be relieved off their financial troubles with the launch of Petro, but all it has done is broken the system even more. It is not like Petro didn’t take off due to the lack of cryptocurrency knowledge in the country. In fact, the truth is far from it.
During the launch of Petro, Dash, another popular cryptocurrency, was already being used in public and private transactions. The country also had its own Bitcoin ATMs, with some speculating that Venezuela was so involved in the cryptospace that a dip in transactions resulted in a significant dip in the total BTC transactions volume.  
The integration of Petro into the financial system of Venezuela was supposed to be a landmark move, aimed at arresting the country’s degradation. Looking at the factors mentioned earlier, it is clear that the state-backed cryptocurrency has not done anything to save the country. Last year, when Maduro spoke about the cryptocurrency, he claimed that it will change the way citizens live in the country. In some twisted way, that is exactly what has happened.
With the latest blackout, Venezuela has fallen deeper into the chasm. Schools were closed, communications were negligible, and food and water resources were depleting. In the midst of all this, Maduro’s main focus has been to curb Juan Guaido’s ascendancy. On 28 March, the incumbent government banned Guaido from holding any public office for the next 15 years, a rule brushed off by the interim President who stated,
“It doesn’t matter. We will continue to raise our voice from the streets.”
Despite the aloofness of the government and the President, organizations such as the Red Cross have been trying to protect the citizens of Venezuela. Just recently, the humanitarian organization managed to broker a deal within the country to allow delivery of aid to the affected people. Red Cross claimed that the scale of operations was similar to the Syrian situation in terms of people affected.
Petro’s failure was again evidenced when Venezuelan citizens continued to use fiat money and credit cards for their day-to-day activities, instead of Venezuela’s own cryptocurrency. The movement of Petro within the country has also been scarce as only a handful of people have reported to having used it. Links with Russia have only hurt Petro’s reputation, with reports still waiting to confirm Vladimir Putin’s involvement in the creation of Petro.
Venezuela is now a playground for Russia-US geopolitics and the only victims are the citizens of the South American country. Cryptocurrencies have provided some hope though, with on-ground reports showing that people have actually used Bitcoin and Bitcoin Cash for ‘much needed financial freedom.’ Right now, Venezuela is holding on for dear life, with help pouring in from different quarters of the world. However, one thing is for certain: Petro is not the country’s savior.
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Government should ‘stay out of the way’ at times, says US State Department official

The first day of 2019’s DC Blockchain Summit in Washington D.C. saw many prominent people from the field of U.S. politics. One such speaker was Manisha Singh, who suggested that the the country was closely observing global approaches to blockchain.
The Acting Undersecretary of State for Economic Growth, Energy, and the Environment, Manisha Singh, stated that the Trump Administration was surveying other States’ activities in the field, while discussing domestic and coordinated international efforts around blockchain.
Singh spoke about the State Department’s perspective on blockchain and what the agency looked for in other nations. Singh said,
“We want to see other countries adopt light-touch and compatible regulations so the private sector has room to innovate and perfect potential new uses for blockchain. As the government, sometimes the best thing we can do to help is stay out of the way.”
Singh added that the State Department was in the research phase and was still trying to understand the tech. She further added,
“Blockchain technology is becoming a global phenomenon. It is therefore essential that we better understand this cutting-edge technology, as it becomes more widely adopted in our economy.”
The United States is picking up pace with respect to cryptocurrency regulation and has already pushed blockchain technology experimentation in different fields, especially at the state level, reported Cointelegraph. The use cases that have been recently added include defense and voting procedures, among others.
Singh added that lawmakers were curious about decentralization. She said that they will conduct oversight as needed and ensure public protection. The overall goal of the agency was to understand blockchain technology and its open and decentralized nature.
According to the publication, Christopher Giancarlo, Chairman of the Commodity Futures Trading Commission (CFTC), considered blockchain as a “would-be mitigating factor in the 2008 economic crash,” at the same summit.
He was reported by the publication as saying,
“What a difference it would have made a decade ago if blockchain technology had been the informational foundation of Wall Street’s derivatives exposures.”
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Fed Chair Concerned About $22 Trillion US Debt, is Bitcoin a Viable Alternative?

The US national debt now stands at $21.974 trillion, a 10% increase since President Donald Trump took over the oval office. And Bitcoin may be the needle people need to pop the debt bubble.

Fed Chair Jerome Powell, talking about the $22 trillion US debt:
"I'm very worried about it, but from the Fed's standpoint . . . the long-run fiscal non-sustainability of the US federal government isn't really something that plays into . . . our policy decisions."
Buy bitcoin.
— Jake Chervinsky (@jchervinsky) February 1, 2019

“From the Fed’s standpoint, we’re looking at a business cycle length: that’s our frame of reference,” Powell said. “The long-run fiscal, non-sustainability of the U.S. federal government isn’t [really] something that plays into the medium term that is relevant for our policy decisions.”
Understanding the Debt Bubble
In retrospective, the national debt is a way of measuring what the US government owes to its creditors. Since the government always spends more than what it takes, the said debt continues to rise. For instance, under the Obama administration, the national debt had increased from $10 to $20 trillion – a spotless 100 percent.
In the past 60 years, the US government has struggled to balance the budget – by spending and earning at an equal level. Every passing administration left a higher debt burden for the next, starting with President Ronald Reagan via President Clinton to President Obama. The US never came out of the so-called debt bubble.
But it doesn’t necessarily mean that they cannot. After all, the US is sitting atop a dollar printing press.
Ideally, Uncle Sam can print its own money, unlike other nations. The size of their debts – arguably – does not matter because the government can pay its debt any day it wants. They would not have to impact the standard of living. According to the Bretton-Woods agreement, the World Bank and the IMF made US Dollar as the world’s only global reserve currency. That led governments across the globe to stash the greenback in their central banks. It created demand, and the US Federal Reserve limited supply.
As of now, there are approximately 1.2 trillion US Dollars in circulation. That is not enough to settle day-to-day global trades: to purchase oil, gas, coffee, corns, and even iPhones. Countries, on the other hand, are sitting atop larger dollar reserves. China, for instance, has $4 trillion; Japan has over $1 trillion – and so on.
Why Bitcoin?
The only thing that changed between then and now is the internet. The millennials now have information about the debt bubble. They understand how every dollar in their pocket is indebted. They also realize that their own national currency is indebted to an-already indebted US Dollar.
Bitcoin enthusiasts project the digital currency as a solution to beat down the dollar hegemony. It expects millennials to exchange their national fiats for a technology that is independent of the US debts, government policies, Federal rate hikes, and whatnot.
Vinny Lingham, the founder of Civic, said that bitcoin’s intrinsic attractiveness against the debt bubble would attract more wealth.
“More wealth will be created in crypto over the next 10 years, than over the prior 10 years,” said Lingham. But remember, like any success story, it’s not going to be a straight line up. Keep believing and just be patient.”
Erik Voorhees, the founder of Shapeshift, hoped that the world would hedge their savings into bitcoin once the next financial crisis hits.

When the next global financial crisis occurs, and the world realizes organizations with $20 trillion in debt can't possibly ever pay it back, and thus must print it instead, and thus fiat is doomed… watch what happens to crypto.
— Erik Voorhees (@ErikVoorhees) November 8, 2018

“They,” Voorhees said while referring to cryptocurrencies like Bitcoin, “may drop during the early phase liquidity crunch, but ultimately the world will move away from fiat money (printed without end, trending toward zero) toward crypto money (known, transparent, fixed supply, not subject to politicians’ opportunism).”
At the same time, economists have a different opinion. Nouriel Roubini, a New York-based financial expert, said that bitcoin was a mother of all scams. He added that cryptocurrencies were a wet dream of individuals with zero financial literacy. Warren Buffet, a Wall Street investment giant, refused to consider Bitcoin as an investment.
“If you buy something like bitcoin or some cryptocurrency, you don’t have anything that is producing anything,” Buffett said in an interview with Yahoo Finance. “You’re just hoping the next guy pays more. And you only feel you’ll find the next guy to pay more if he thinks he’s going to find someone that’s going to pay more.”
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US Agencies Top List of Law Enforcement Requests Sent to Crypto Exchanges

As the crypto industry grows, its increased use by both innocent cryptocurrency investors and malicious cyber criminals does as well. This has prompted government agencies and financial market regulators to take a deeper look at crypto transactions in order to track down potential criminal behavior in hopes of finding evidence that will lead to successful prosecution.
New data reveals that government agencies in the United States are taking the most interest in crypto, and the country is topping the list of law enforcement related requests being sent to cryptocurrency exchanges across the industry.
US Government Agencies Lead Law Enforcement Requests on ShapeShift
Switzerland-headquartered cryptocurrency exchange ShapeShift has followed the lead of other top cryptocurrency exchanges in offering its customer base and the onlooking public additional transparency into their operations.
In a blog post entitled “Pulling Back The Curtain,” the Erik Voorhees-led exchange revealed how the company complies with law enforcement requests from various countries and their respective government agencies from all over the globe.
Topping the list, is the United States, with 18 law enforcement related requests. The US total requests are over double that of Germany, which ranks second in requests with just 8 in total. Coming in third is the United Kingdom, which has just 33% of the request that the United States did.
Related Reading | Wall Street Journal: ShapeShift is Being Used By Criminals
In fact, just one U.S.-based government agency, the Federal Bureau of Investigation, matched the entire U.K. for total requests sent to ShapeShift. Other U.S. government agencies that ShapeShift was forced to comply with include the Commodity Futures Trading Commission, the Securities and Exchange Commission, the Department of Justice, and even the Department of Homeland Security.
ShapeShift explains that the requests vary in nature, but are primarily related to sending subpoenas requesting customer transaction data, transaction IDs, names, email addresses, IP addresses, and more. The blog posts reveals that ShapeShift often doesn’t know why the information is being requested, only that it is, and must keep any details it does have access to confidential.
ShapeShift had previously been known as “the exchange without accounts,” allowing customers to trade crypto assets on their platform without providing any personal details. However, that changed in October 2018 after increased pressure from regulators. Now, ShapeShfit is being forced to share that data with government agencies from all over the globe.
Kraken Crypto Compliance Report Shows Similar Stats, US Leads The Charge
The United States also topped the list in Kraken’s “2018 Transparency Report” with 315 total requests. The next closest was the United Kingdom with a mere 61 requests. The U.S. accounted for the majority of all 475 requests that Kraken received in total.
Another interesting trend was revealed by each report: Law enforcement related requests grew throughout the year, and spiked in Q4 2018.
Related Reading | Crypto and Bitcoin Ransom: A Growing Trend
The crypto space has earned itself the reputation for being a “wild west” type environment, riddled with crime. While there is some truth to this – with the ever-growing prominence of cryptocurrency exchange thefts, crypto-stealing malware, Bitcoin ransoms, and scams – these transparency and compliance reports do show that many cryptocurrency exchanges are doing their best to keep their platforms clean of any crime, and are working closely with law enforcement agencies on compliance.

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US Government Aims to Make Privacy Coins’ Use Case Obsolete

A branch of the United States Department of Homeland Security (DoHS) is researching the possibility of using blockchain forensic analysis tools to better trace privacy coin transactions.
Privacy No More: US Government Preparing Forensic Analysis Tools
Among the biggest concerns surrounding cryptocurrencies like Bitcoin are fears that the emerging technology could facilitate money laundering by rogue countries, terrorist organizations, and cybercriminals.
However, the United States government has increasingly bolstered their ability to trace blockchain transactions, and have even learned how to track Bitcoin transactions back to the source and identify the wallet holder, as was the recent case where the U.S. Treasury sanctioned two men from Iran over their involvement in ransomware attacks.
Related Reading: Iran Is Prepping National Crypto to Evade US Sanctions
Next on the government’s agenda, is to begin looking into privacy-focused cryptocurrencies, such as Dash, Zcash, Monero, and more.
According to a pre-solicitation document published by the DoHS’s Small Business Innovation Research Program. The document, discovered by The Block, the U.S. government is allegedly investigating ways to better track transactions on the blockchains of the aforementioned privacy coins.
The report does speak positively about some of the aspects of privacy coins, but calls attention to transactions of “illegal nature” that occur using said cryptocurrencies. The eventual goal is to build out a platform that law enforcement agencies, government branches, and even private financial institutions can use to analyze and enforce important anti-money laundering laws.
Since the document is just a pre-solicitation, the notice is “merely an opportunity for interested parties to comment on or request information about the attached topic areas,” and doesn’t mean that the government already has such tools in its possession. It does, however, prove that the DoHS has concerns over privacy coins and their potentially illegal usage.
Japan Bans Privacy Coins, Will the United States Follow?
Zcash, Dash, Monero, and many other privacy-focused cryptocurrencies allow users to hide transaction and address data from anyone outside of the sender and receiver.
Monero is the cryptocurrency of choice for most cryptojackers as cybercriminals are able to easily hide their tracks. Monero has also unseated Bitcoin as the most-used cryptocurrency on the dark web, so it’s no surprise to see that the United States is joining Japan in addressing concerns around privacy coins.
Related Reading: Japan’s FSA Grants Self-Regulatory Status to Crypto Industry
In Japan, where cryptocurrency-related theft has skyrocketed, the Financial Services Agency (FSA) has imposed a ban against any cryptocurrency exchanges in the country from offering privacy coins. The ban took effect this past June, and the ripple effect is just now reaching the United States.
Coincheck, which suffered the largest cryptocurrency exchange hack in history at the start of this year, was among the exchanges that were forced to comply with the FSA’s ban, and removed Monero, Dash, Zcash, and Augur’s Reputation coin.
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Time-Travel Crypto Once Backed by Trump-Appointed Acting Attorney General

Acting U.S. Attorney General Matthew Whitaker once was involved in an alleged scam promoting strange inventions, including a time-travel cryptocurrency.
Attorney General Matthew Whitaker Backed an Alleged Scam Company
Earlier this month, United States President Donald Trump ousted Attorney General Jeff Sessions from his post after Trump grew increasingly frustrated with Sessions’ recusal from the Russia probe. 
In his place, Trump appointed the Chief of Staff under Sessions, Matthew Whitaker, to the role of acting U.S. Attorney General.
The move sparked much controversy, with critics condemning Trump appointing Whitaker without approval from the Senate, which according to some violates the Constitution. And as is always the case with newly-appointed politicians, a witch hunt ensued and Whitaker’s shady past was uncovered.
Invention Scam Firm Worked on a Time Travel Cryptocurrency
Whitaker’s peppered history could have been erased, if the time-travel cryptocurrency he once backed ever came to fruition.
It turns out, Whitaker was once paid at least $10,000 in 2014 to serve on the advisory board of an invention company called World Patent Marketing. The newly-appointed Attorney General appeared in promotional videos, provided quotes in press materials, and in general showed a strong association with World Patent Marketing.
“As a former U.S. Attorney, I would only align myself with a first class organization,” he said in a press release issued by World Patent Marketing from back in 2014. 
Except World Patent Marketing ended up potentially being a complete scam, with the U.S. Federal Trade Commission filing a complaint against the firm over reports from consumers who went in debt or lost the entirety of their investments with the invention firm. 
The company was ordered by a Florida judge to close its doors for good and was forced to pay a settlement of $25 million.
Related Reading: Former Trump Advisor Joins Blockchain Startup
Among the invention scams World Patent Marketing was involved in, one such invention involved a cryptocurrency called Time Travel X that never saw the light of day.
Time Travel X was dubbed a “theoretical time travel commodity tied directly to price of Bitcoin.” In 2016, the company attempted to raise funds for the project by asking for bitcoin donations so World Patent Marketing could “make time travel a reality.”
As if a time travel cryptocurrency wasn’t strange enough, World Patent Marketing also announced a “masculine toilet” invention for “well-endowed men” so they can avoid having their genitalia touch toilet water. 
The firm also tried to bring Sasquatch dolls to retail, and suggested that Bigfoot does indeed exist, and that DNA evidence proved it.
Considering Attorney Generals like Matthew Whitaker are said to act as the “People’s Lawyer” for all citizens, the fact that Whitaker was involved in a company that was taken to court by the FTC for scamming consumers, is worrisome, and certainly calls Whitaker’s integrity into question.
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US Regulator Wants to Adopt Blockchain to Maintain Pace with Market Manipulators

The chair of the U.S. Commodity Futures Trading Commission (CFTC) has said that he wants to adopt blockchain to “keep pace with those who attempt to defraud, distort, or manipulate” financial markets.
CFTC Chairman Giancarlo Envisions Compliance Built into Business Operations Through Smart Contracts
J. Christopher Giancarlo spoke about the use of blockchain and machine learning for regulatory purposes at Georgetown University. The head regulator is confident the digital era will prove to be a positive factor to better oversee financial markets.
“These tools will become even more paramount as emerging blockchain technologies seek to decentralize markets or disintermediate traditional actors. It is critical that we have the ability to keep pace with those who attempt to defraud, distort, or manipulate.”
Giancarlo gave several examples of adoption of new technologies at the regulatory level.
These include “using machines to independently identify segments of the markets where concentration risks or unrecognized counterparty exposures are emerging and flag them for staff consideration and action” and “new machine-learning based surveillance tools” designed to “sniff out patterns of likely illegal trading activity or attempts to manipulate markets for enforcement analysis.”
The CFTC chair said the ongoing digital revolution in the world’s trading markets have far-ranging implications for capital formation and risk transfer. He added that he expects the majority of standard tasks to be managed by machines as automation technologies are paired with blockchain to standardize and distribute data to market actors and regulators.
“We can also envision the day where rulebooks are digitized, compliance is increasingly automated or built into business operations through smart contracts, and regulatory reporting is satisfied through real-time DLT networks. The machines here at the CFTC would have the ability to communicate regulatory requirements and consume and analyze the data that comes in through such systems.”
Giancarlo has recently stated that cryptocurrencies “are here to stay” and that many countries across the globe are hungry for functioning currencies, which shows there is a market for digital currencies. He is, however, skeptical about cryptocurrencies’ ability to rival the dollar or other hard currencies.
While the U.S. CFTC is yet to adopt blockchain technology to better oversee financial markets, the financial watchdog has won its first Bitcoin fraud action. A  New York federal court has ordered Gelfman Blueprint and its CEO Nicholas Gelfman to pay over $2.5 million in civil monetary penalties and restitution over their +$600,000 Ponzi scheme.
Related Reading: CFTC Chair: Cryptocurrencies Have a Future, They Are Here to Stay
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FCC Chairman Admits Antiquated Regulation May Hurt Emerging Blockchain Technology

Aijt Pai, U.S. FCC Chair, has said it’s a challenge to level the playing field between emerging technologies, including blockchain, and not disadvantage any of them.
US Telecoms Regulator Studies How to Evolve Blockchain
The chair of the Federal Communications Commission (FCC) – the government agency in charge of regulating radio, television, wire, satellite, and cable – told the Indian Express there might be a need for expanding the ambit of a telecom regulator to include the evolving tech.
“So one of the challenges is to figure out how we find a level-playing field that promotes investment and innovations for all these firms without disadvantaging any one of them. The second issue is that these are very dynamic industries and one can foresee in coming decades – things like artificial intelligence, machine learning, blockchain, quantum computing will have significant impact on how communications networks operate.”
While not having jurisdiction over these firms yet, the FCC is studying the matter and “how should [their] thinking about regulation evolve” as emerging technologies gain impact on the space. “No time ever has been more challenging than the 21st century”, he added.
In the United States, convergence has made a lot of the regulatory structure antiquated, Pai argued, adding that the Communications Act, which the FCC administers, was first developed in 1934 and subsequently amended in 1992 and 1996.
“That Act still contemplates that wireless service is separate from regular telephone services, which is completely separate from cable service, which is separate from satellite service. When it comes to broadband, all four industries are vigourously competing.”
The FCC chair, who was directly appointed by U.S. President Donald Trump, came to the limelight for his attempts to roll back net neutrality, which restricts internet service providers from arbitrarily controlling bandwidth access to specific websites and apps.
The issue may threaten the cryptocurrency ecosystem as, without net neutrality, an internet service provider, which is owned by a conglomerate decides to absorb an exchange, they can charge users extra or toggle down speeds.
Restricted access to cryptocurrency exchanges may result in lower industry growth, trading volumes, and digital currency market prices. New operators will face more difficulties entering the market and Bitcoin miners may also see profitability decline with higher rates for nodes or even bans from internet service providers.
In February 2018, the FCC issued a Notification of Harmful Interference to a New York-based Bitcoin miner who was ordered to turn off his mining rig – Antminer S5 Bitcoin Miner – for interfering with T-Mobile’s wireless network.
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US Securities and Exchange Commission [SEC] strikes again to suspend another cryptocurrency company

On 22nd October, a company in the United States came under the scanner of the Securities and Exchanges Commission [SEC] because of false claims of approved cryptocurrency custodian policies.
American Retail Group or Simex Incorporated, a Nevada based digital assets exchange, has had their services suspended till 3rd November by the SEC after the company claimed that it had partnered with an SEC qualified custodian for cryptocurrency transactions like Bitcoin [BTC]. Robert A Cohen, the Security and Exchanges Commission’s Cyber Unit enforcement Chief stated:
“The SEC does not endorse or qualify custodians for cryptocurrency, and investors should use vigilance when considering an investment in an initial coin offering.”
Another red flag that was raised by the SEC was the fact that Simex had started offering tokens which was apparently “officially registered in accordance with SEC requirements.”
This was not the first SEC crackdown of the month, with the latest suspension coming in the wake of the financial watchdog suing Blockvest, an ICO. Blockvest was reportedly conducting business under the false pretense of having SEC approval. The organization had stated:
“Blockvest and Ringgold also allegedly misrepresented Blockvest’s connections to a well-known accounting firm, and continued their fraudulent conduct even after the National Futures Association (NFA) sent them a cease-and-desist letter to stop them from using the NFA’s seal and from making false claims about their status with that organization.”
Frauds and illegal activities in the cryptocurrency industry have been under the radar of security agencies for quite some time now with several cryptocurrency companies being suspended or put to the axe. The SEC has been at the forefront of several of these cases with several more still in the pipeline.
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Report: North Korea Is Evading US Sanctions Using Cryptocurrencies

North Korea is reportedly ramping up the use of cryptocurrencies to evade US economic sanctions. It’s also alleged that the country is developing its own native crypto asset to further assist moving money across borders, according to a duo of financial intelligence analysts from Washington D.C.
North Korea Allegedly Uses a Mixer to Launder Money Using Crypto
According to a detailed interview with Hong Kong-based business news publication, Asia Times, independent financial analysts Lourdes Miranda and Ross Delston believe that North Korea has been using cryptocurrencies to circumvent U.S. led economic sanctions.

“International criminals everywhere prefer cryptocurrencies and the [Democratic People’s Republic of Korea] DPRK is no exception. Cryptocurrencies have the added advantage to the DPRK of giving them more ways to circumvent U.S. sanctions. They can do so by using multiple international exchangers, mixing and shifting services – mirroring the money laundering cycle,” explained Miranda and Delston.

The pair of analysts explain that North Korea would use a “mixer” also known as a “Laundry, Tumbler and a Washer” to move cryptocurrencies in such a way as to hide their tracks, which often includes sending the same type of cryptocurrency back to the original source.

“It is equivalent to requesting change for a $100 and receiving different denominations in return totaling a $100,” they said.

Miranda and Delston further warn that the DPRK could switch to a different cryptocurrency to further obscure the origin of funds.
North Korea Developing Their Own Cryptocurrency
Following the lead of Iran, North Korea may also be working on creating its own cryptocurrency for the purpose of evading economic sanctions.
Miranda and Delston suggests that having “their own cryptocurrency would also facilitate their ability to open online accounts under the guise of a non-adversarial nation using anonymous communication to conceal the user’s locations and usage on the internet.”
The two analysts believe that the DPRK could create its own wallet services so that it can move funds to and from European-based accounts that feature no personally identifiable information, in order to hide the fund’s origin country.

“For example, DPRK could open an online wallet using a Russia-based service, transfer its cryptocurrency into a Bulgaria-based wallet service and then transfer it again into a Greece-based wallet service, all through anonymous communication and using their own blockchain.”

After the funds have moved through a number of anonymous accounts, the cryptocurrencies would ultimately make their way to European exchanges that have relationships with a U.S.-based bank where they’ll be converted to USD.

“Voilà, the DPRK now has U.S. dollars with none of those pesky sanctions attached.”

Like North Korea, both Russia and Iran have been said to be using cryptocurrencies in order to evade international economic sanctions. Last month, Iran released the first details about its own native cryptocurrency, the digital Rial.
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