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Cryptocurrency Certification Consortium has recently released Cryptocurrency Standard Security guidelines for the entire crypto-industry. Read more...

The number of hacking incidents involving cryptocurrency exchanges until now shows that the security features implemented by many platforms arent enough and are in need of an overhaul. If it is indeed true, then the recent initiative of the Cryptocurrency Certification Consortium is a welcome development for many community members.

The consortium has recently introduced a security guidance Cryptocurrency Security Standard, suggesting the implementation of best security practices by Bitcoin and other crypto-exchange platforms across the world. The guidance draft is designed to introduce new security features while augmenting the existing standards adopted by many exchanges and trading platforms. Some of the features presented by the Cryptocurrency Certification Consortium includes advanced authentication procedures, multiple signature techniques, and decentralized storage methods.

The proposed Cryptocurrency Security Standard will be a one-size-fits-all solution that can be followed by any digital currency platform to secure user funds irrespective of the business nature. Many cryptocurrency platforms have already adopted multi-factor authentication systems for additional security, and few make it compulsory for the users to enable 2FA to operate their accounts.

Also, the multi-signature feature, which requires two or more users/devices to confirm transactions is offered by many wallet service providers. While multi-signature wallets are prevalent, it is yet to be implemented by a majority of Bitcoin exchanges and trade platforms. The draft also suggests wallets on cryptocurrency platforms to be encrypted and frequently backed up to ensure that the access to cryptocurrency deposits is not lost in the case of hardware or software failure.

Since the hacking incidents, cryptocurrency platforms are increasingly using cold storage/wallets to store a majority of the user funds, while maintaining a minimum required liquidity in hot wallets. The adoption of such practices has limited the risk of exposure to external attacks, cutting down losses in the event of hacking incidents.

The security standard also makes allowance for certain procedures to be invoked in the instance where the keys are compromised or lost. The consortium has also given consideration to policies for access control involving cryptographic keys. These policies are put in place to help organizations in the eventuality of the security compromised by either an insider or a hacker who might have gained access to the keys.

A combination of security features, contingencies and regular security audits makes the new Cryptocurrency Security Standard useful for crypto-platforms. The wider adoption of these security practices will help exchange platforms, both big and small to operate without compromising the safety of both users and platforms cryptocurrency deposits.

Link:
Cryptocurrency Certification Consortium to Standardize Security across Crypto-Platforms - newsBTC

Published time: 1 Apr, 2017 21:17Edited time: 1 Apr, 2017 21:18

New legislation authorizing digital currency as a legal payment method has come into force in Japan.

The text of the law was releasedby Japans Financial Services Agency on March, 24.

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Earlier this week, the Accounting Standards Board of Japan said that it would begin work on the creation of a framework to help understand how digital currency would be dealt with in the accounting sector. The process is expected to take six months, according to Nikkei.

Big business is especially concerned; since the country has failed to provide guidelines regarding the accounting process when dealing with cryptocurrencies.

There is a risk that companies that hold virtual currency could turn out to have distorted valuations or that huge losses surface suddenly, Chikako Suzuki, partner at PricewaterhouseCoopers Aarata, told Nikkei Asian Review.

Around $1.7 billion of cryptocurrency, including bitcoin, Ripple, Litecoin and others, was in circulation across Japan two years ago. The 2020 projection is set to be at $9 billion, according to a Fuji Chimera Research Institute study.

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The set of measures, that now has come into force, was drafted as far back as 2015 and passed in 2016 after a year of negotiations. Uncertainty over the legal status of virtual currency was stirred after a multi-million dollar embezzlement scandal and the collapse of the Tokyo-based Mt.Gox Bitcoin exchange.

Mt.Gox, once largest exchange service for the cryptocurrency, collapsed in 2014 when 850,000 coins ($480 million at the time) went off its digital vaults.

The company, which dealt with around 80 percent of global bitcoin transactions, admitted that there was a bug in their system that allowed hackers to steal the coins.

The new law outlines that all virtual currency exchanges are to be regulated by the Japanese Financial Services Agency. They must be registered with the financial watchdog and verify the identity of customers opening accounts.

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Bill making cryptocurrencies legal way of payment comes into force in Japan - RT

Coins unlike the ones you find in your couch

Whats an Initial Coin Offering?

While it sounds like the beginning of an intrepid relationship with a metal-loving deity, turns out ICOs have nothing to do with actual coins.

ICOs, aka token sales, are part of blockchain technology fundraising. An ICO is essentially a crowdfunded cryptocurrency.

Tokens for new cryptocurrency are sold as a fundraising effort for technical development.

Whenever a new cryptocurrency is born, its startup parents arbitrarily decide its worth.

After supply and demand smack it around for a bit, participants in the price dynamic testing then settle on a value.

Instead of a central government, the network of participants determines how much the cryptocurrency is worth.

Unlike Initial Public Offerings, acquiring a token does not mean owning stakes in the company.

Although venture capitalists have been giving ICO the cold shoulder, things are starting to look up.

Cryptocurrency investors made bank last year, with some doubling their investments.

Investors see returns more quickly with ICOs due to the liquidity of cryptocurrencies.

Instead of waiting for a startup to playout via an IPO or acquisition, investors can bail if things arent going well.

Its easy to pull fundsor profits, if things did work out. All investors have to do is use a cryptocurrency exchange to pull their profits, then use an online service to convert this to real people money.

If this sounds sketchy, youre not alone. Traditional investors arent really fans of the regulatory uncertainty.

The world of ICO can be full of scams and schemes, with little control over financials and strategy.

U.S. Securities and Exchange Commission and friends are still investigating ICOs. But technically ICOs fall outside legal frameworks.

ICOs dont offer equity in startups, and only give cryptocurrency discounts before they release them to the exchanges.

Additionally, ICOs are global, not national. Theoretically, anyone can invest on a semi-anonymous level. Oh, and theyre not funded by central authorities or banks either.

Criminal activity is now mostly self-regulated within the community via crowdsourcing and external groups.

Some companies are even working to establish Know Your Customer frameworks and make ICOs Anti-Money Laundering compliant.

Those who support ICOs argue traditional methods of investing only benefit those already dominating the system.

Investing outside of the system provides more freedom, especially for startups.

ICOs mean startups can raise funds without worrying too much about looming stakeholders. Non-profits can also benefit if they want to build open source software to raise capital.

From their humble beginnings, bitcoins are now worth around $1,120. Bitcoins market cap is around twenty billion.

Allegedly, half of that is owned by bitcoin whales, a group of less than one thousand people who bought into bitcoin early.

Bitcoin whales have a huge impact on most ICOs. Most live in China, but some investment and hedge funds also have huge stakes in bitcoin. Fortunately, some of the bitcoin whales profits are reinvested in innovation.

Overall, ICOs are dominating in crowdfunding, with most top raises coming in as cryptocurrency.

Though its still kind of murky and mysterious, blockchain technology is starting to be seen as more legitimate. Initial Coin Offerings demonstrate the success of industry. As more investors become comfortable with ICOs, blockchain innovation will continue creating new possibilities.

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The rise of cryptocurrency (and what the heck it even is) - The American Genius