PwC Malta notes that organisations are rapidly changing the way they work and how they capitalise on new technologies like blockchain and distributed ledger technologies (DLT) — innovations that bring challenges that may put stakeholders in an uncertain position.

“Blockchain and other emerging technologies are making our clients rethink the way they do business. With the addition of this new tool to our suite of software we believe that we can continue to add value to our clients and help build trust in these emerging technologies,” said David Valenzia, Territory Senior Partner of PwC Colombia.

Since Malta adopted three bills last year regulating virtual financial assets, the island nation has often been referred to as the “Blockchain Island”. As a matter of fact, Malta has attracted players operating and providing services in the cryptocurrency space who are in the process of obtaining a license in terms of the Maltese Virtual Financial Assets Act, the PwC press statement reminds.

Therefore, PwC Global assembled its leading assurance professionals, software developers and blockchain experts to develop assurance solutions to support this complex, emerging area.

Furthermore, PwC thinks that with the launch of their new software tool, they are “well-positioned” to provide audit and other assurance services to their clients and prospective clients holding or transacting in cryptocurrency.

PwC Malta says the new software they launched can provide independent, substantive evidence of pairing the private key and the public address, which process is needed to establish ownership of cryptocurrency. Furthermore, the software is seen to securely interrogate the blockchain to “independently” and “reliably” gather corroborating information about blockchain transactions and balances.

In addition, PwC has started leveraging its new solution to support audits of clients engaged in cryptocurrency activities, the press statement adds. PwC is also working with companies to help them address the new opportunities and challenges of blockchain and cryptocurrency, including supporting them to implement the processes and controls they will require in order to obtain assurance reports from their auditors, the statement adds.

The group can use its new tool to provide assurance services to clients transacting in bitcoin, bitcoin cash, bitcoin gold, bitcoin diamond, litecoin, ether, ERC20 – OAX token, and ripple (XRP).

The post PwC Malta launches auditing tool for crypto first appeared on The Malta Business Weekly.

Digital payment has come a long way since Edward Bellamy first conceptualised a card used for payment instead of cash in his utopian novel entitled Looking Backward, published in 1887. When the first bank cards were introduced by the end of the 1960s, people appeared to be reluctant to shift habits and pay with a piece of plastic instead of hard cash. Nowadays, producing, updating and using cash — in some cases — can be costlier than card payments. With the spreading use of non-cash payments, hacking the online systems of banks started pacing out movie-like robberies of brick and mortar branches. Security is of elevated importance today in online finances. The blockchain and crypto world strive to disrupt this space; time will tell if hype can solidify.

Transactions in blockchain systems and the storage of tokens — let them be cryptocurrencies or any data — happen in wallets. The access for these wallets — for enhanced security purposes — is through a long private key of haphazard words or symbols. NGRAVE CEO Ruben Merre believes that, while this is a crucial part of the inherent strength of blockchain technology it also is the Achilles heel of the whole ecosystem, at least for the time being.

“The problem lies in how well private keys are managed and protected. Blockchain is an incredible technology and provides a lot of previously unseen security points. It has at least one big Achilles heel though: the private key(s).”

While private keys are part of the inherent strength of the technology, they are often seen as the single-point-of-failure when we look closer at blockchain wallets. A party that gets its hands on the private key can immediately assume full ownership of the wallet’s contents. Moreover, if one loses the private key to their wallet, they lose access to their funds forever, because of the inherent asymmetric (statistically unbreakable) cryptographic relationship between private key (password) and public key (address).

“Hence, security can be improved by optimising the way private keys are managed and protected. First of all, they should be created offline. That way, no third party can know what the key actually is. After that, the associated addresses — which themselves contain no sensitive data that can be tied back to the private key(s) — can be communicated to an online source,” Mr Merre describes. “It is crucial to be able to sign transactions with the private key, but without exposing the private key to an online connection. If you can do all of this offline, you have a very secure solution.”

Another aspect that needs extra thought is improving the backup procedure of one’s private key. “In today’s crypto space, over 90% of people keep their private key on a piece of paper. Completely paradoxical, considering this new and hot technology called blockchain. It almost feels like going back to the stone age. Yet it is a vast reality,” Mr Merre says. He proposes that the solutions offered by his company might be able to bring peace of mind to this space.

Blockchain hurdles

Whether blockchain and crypto can move beyond its hype is truly in the future yet, hopes are high. Nevertheless, the online space must ante up in general in terms of security, whether we talk about finances or the handling of personal data. Today, regardless of trying to offer greater security, the crypto world is still loud of investment scams and compromised funds. Therefore, distributed ledger technology-based solutions still need to live up to their potential.

“In my opinion, one of the most crucial hurdles today is security. With several million stolen each day from crypto wallets, it is a very real barrier for new investors to join the market and existing players to increase their investment exposure. If we can make investing in crypto more secure, potential new market participants will be less wary of joining in,” Mr Merre weighs in on the troubles the distributed ledger technology-based solutions face.

“If we can make investing in crypto more secure, potential new market participants will be less wary of joining in.”

NGRAVE CEO Ruben Merre

“Another scalability hurdle is the off-chain to on-chain translation. We also know this subject as ‘oracles’. Ultimately, blockchain often translates off-chain events to an online version,” Mr Merre adds. “For example, if you are insured against earthquakes and the smart contract of your insurance determines that as soon as there is a quake of six on the Richter scale you automatically get money on your account. In such a case, where does the consensus come from that actually defines what six on the scale of Richter means? Oracles, or dedicated offline parties oriented towards reaching a consensus on such rules, play an important role. As one can imagine, there is significant complexity in doing this right,” the CEO explains.

At the same time, blockchain evangelists, enthusiasts and experts are all concerned about scalability, i.e. the more people use a blockchain-based system and the more transactions they initiate, the longer the execution of the transaction would take. “This is a scalability challenge, yet many players are having a look at it as we speak. Then there is cross-chain compatibility/interoperability: How do you make two different blockchain infrastructures interact? Another point is the energy consumed by the network to reach consensus / to mine blocks. Here as well, solutions are investigated including Proof of Stake, Proof of Ownership, etc. moving away somewhat from the traditional energy-heavy proof of work consensus algorithm(s). Overall maturity on the developer side is another facet. We are still in the early days of this technology, which also means that we still have to develop a lot of code to make specific applications work. All of this needs to grow, evolve, mature, in order to make it easier and faster to scale. Finally, standardisation is one of the aspects that would likely benefit the overall crypto space greatly,” Mr Merre says.

Eyes on Malta

NGRAVE aspires to offer a breakthrough in cryptosecurity, by enabling users to do every single step of the user journey without ever exposing the private keys. The company says that their solution has been developed in close collaboration with the end user to ensure seamless ease of use.

NGRAVE has recently entered the second phase of their product development and expects to have a fully-functional version soon. “We will then perfect that version up to the very details and make it ready for industrialisation. People will be able to pre-order starting in September 2019. Expanding towards Malta is something that would make the most sense for 2020,” Mr Merre tells BM about their plans.

After stating the obvious attraction points of Malta — the breathtaking culture, beaches and weather — Mr Merre looks deeper into the ecosystem of the island nation, underscoring the supportive and innovative attitude of the tech and blockchain community in here.

“Malta is looking at crypto with a long-term perspective, and therefore set up three major regulatory bills last October to attract more cryptocurrency companies. This by itself shows that Malta is pioneering important frameworks to further foster blockchain adoption,” Mr Merre says.

He backs up his view with companies such as  Binance, Bitbay, OKex having set up a base in Malta. He also takes time to praise the Malta Blockchain & AI Summit for its support. “In short, Malta is an ideal tech and entrepreneurial hub and we are committed to being a part of and developing the ecosystem on this small, but a powerhouse of an island,” the CEO concludes.

The post Managing private keys better can foster more security in crypto first appeared on The Malta Business Weekly.

Mr Chao joins Binance to oversee its global strategy, ranging from the company’s venture capital (VC) arm, Binance Labs, to its strategic fiat-to-crypto gateways, including the creation of new partnerships and banking relationships.

“We are thrilled to welcome Gin as our latest leadership hire to strengthen our business ventures and strategy across our global ecosystem,” said CEO of Binance, Changpeng Zhao (CZ). “He will play a key role in driving our strategic business goals that span across the globe, and we are confident that he will help realize new avenues of opportunities alongside the core executive team.”

Mr Chao brings an extensive background of developing and managing strategic investment opportunities as well as overseeing cross-regional business growth opportunities in Asia and the US.

As former Vice President of Strategy and Corporate Development at the National Basketball Association (NBA), Chao led new asset and investment opportunities, including scalable business models, and will leverage his previous experience for Binance.

“I am honoured to be joining CZ and the team during this incredibly exciting time for the industry,” said Gin Chao, Strategy Officer at Binance. “I’ve followed the growth of the senior executives at Binance over the years and it’s a testament to CZ’s vision and leadership to have formed such a talented and accomplished group. I’m looking forward to working with the team on building and providing sustainable blockchain-based services that accelerate cryptocurrency adoption and support our overall mission.”

The post Binance names new strategy officer first appeared on The Malta Business Weekly.

Therefore, the upgraded system showcases three main elements, which are the Mark Price, the Tiered Maintenance Margin Ratio (TMMR) — in order to avoid liquidation of large positions and its after-effect on market liquidity —, and the Forced Partial Liquidation Mode — introduced to eliminate the market impact caused by a large number of liquidated orders.

In addition, the new risk management system has brought balance to the risks and users’ interests. When at risk, positions will be liquidated closer to the bankruptcy price, allowing users more opportunity to remain solvent and recover from the risks.

OKEx reports an example to demonstrate the performance of the upgraded system, focusing on the bitcoin (BTC) flash crash incident that happened in May 2019. The incident was caused by a BTC5,000 dump at an oddly low price of US$6,200 on other exchange. The massive sell order caused the BTC price plunge from US$7,800 to US$6,100 in only ten minutes and created a short-time arbitrage opportunity, as the press release says.

However, thanks to the OKEx mark price of BTC, which is formed by the market prices from the other five major exchanges, GEMINI, Coinbase, Bitstamp, Kraken, and OKCoin, a price crash in one particular exchange would not cause devastating effects on OKEx markets, the company insists.

During the incident, the enhanced risk management system has demonstrated stabilized the quarterly contract price at around US$7,000 and no clawback took place at OKEx.

The post OKEx launches risk management system first appeared on The Malta Business Weekly.

“We are excited to finally launch Binance.US and bring the security, speed, and liquidity of Binance.com to North America,” said Changpeng Zhao, CEO of Binance. “Binance.US will be led by our local partner BAM and will serve the U.S. market in full regulatory compliance.”

BAM Trading Services will support Binance.US to launch, with a focus on the trading of mainstream cryptocurrencies with liquidity.

“It is an honour to partner with Binance to launch the U.S. extension of Binance, leveraging its tier-one security and technology in tandem,” said a representative from BAM Trading Services. “We are committed to providing a secure and compliant platform, and beginning the start of a fruitful alliance with Binance.”

The post Binance partners with BAM to launch US exchange first appeared on The Malta Business Weekly.

“As environmental problems threaten agriculture and jobs in rural communities decrease, it has become essential to change the way we live and eat and Zoegi believes that the crypto community can lead that change,” the press statement sent to BM says.

Saying that modern agriculture is responsible for one-quarter of pollution that affects habitats around the world threatening biodiversity, Zoegi believes it has become essential to grow organic and improve the world’s food supply.

“We know that we cannot keep living as we do. Something has to change and food production is in the centre of that change. We cannot keep on polluting the planet, taking resources out of small communities the way we do. It’s simply not sustainable,” says Yelena Kensborn, founder of Zoegi.

Utilising blockchain and cryptocurrencies, Zoegi aims to facilitate transactions between buyers and sellers, allowing the user to scan every product to see exactly where it comes from.

Having gained traction in Malta with a deal to supply restaurant Caviar and Bull, Zoegi expects to soon close further deals around Europe this year.

Fighting global crisis

The company wants to change the way food is produced and distributed and “to fight the global environmental crisis at the same time as bringing the economic power back to rural, economically deprived areas,” the press statement adds.

Zoegi says that by helping local farming communities they improve the environment with increased organic farming. The startup’s long-term goal is to create a decentralised economy where every community in the world would realise the value of their work and can sell their products to the international market.

Charging in crypto, not fiat, the startup is looking to identify the key influencers in the space who do not just see their crypto tokens as a digital asset to trade on an exchange but are looking at them as a means towards an independent economy, the press statement says. The team believes that this will make the public think of crypto as it was originally intended; a means to trade independently of a central authority and fix the problems of existing systems.

“The Mediterranean is the original hub for trading. Here, deals were made between Europe, Africa and the Middle East. Because of this, it has always been open to new currencies, and millions of different coins have passed the ports of Malta. It is, therefore, not surprising, that Malta has been the most prominent player in the crypto scene, with a clear eye to the future and where the world is heading,” the startup concludes in the press statement.

The post Startup Zoegi to use blockchain for supporting agribusinesses first appeared on The Malta Business Weekly.

The breach was discovered May 7, 2019 at 17:15:24 (UTC), caused by hackers using a variety of techniques, including phishing, viruses and other attacks.

Binance says all the 7,000+ bitcoin was compromised in one transaction, being the only affected transaction. “It impacted our BTC hot wallet only (which contained about 2% of our total BTC holdings). All of our other wallets are secure and unharmed,” the press statement says.

“The hackers had the patience to wait, and execute well-orchestrated actions through multiple seemingly independent accounts at the most opportune time. The transaction is structured in a way that passed our existing security checks. It was unfortunate that we were not able to block this withdrawal before it was executed. Once executed, the withdrawal triggered various alarms in our system. We stopped all withdrawals immediately after that,” the press statement adds.

Binance said after the incident that they will conduct a thorough security review, which will include all parts of their systems and data. The review should take a week, according to Binance’s estimates. During this period, deposits and withdrawals will need to remain suspended. “We beg for your understanding in this difficult situation,” Binance says. Trading remains enabled, though.

“Please also understand that the hackers may still control certain user accounts and may use those to influence prices in the meantime. We will monitor the situation closely. But we believe with withdrawals disabled, there isn’t much incentive for hackers to influence markets. In this difficult time, we strive to maintain transparency and would be appreciative of your support,” the Binance press release says.

The post Hackers steal BTC 7,000+ from Binance, exchange promises to recover lost funds first appeared on The Malta Business Weekly.

“As part of its responsibility toward safeguarding consumer protection, the MFSA is providing useful and easy-to-read information on cryptocurrency investments,” the watchdog says in the public note they published on their website. In addition to numerous warnings the authority has already issued, it is committed to “further educating the public on how to identify and avoid scams, as well as the actions recommended in the event that one encounters a scheme of a dubious nature within the crypto asset sector,” the public note adds.

The MFSA says that scams are highly likely to be advertised online, with the use of “clickbait titles” to attract unsuspicious investors. The authority adds that some websites will ask for personal details, which can often be followed up by a phone pitch by a “friendly and supposedly expert salesperson whose aim is to convince victims to invest money in their scheme,” the MFSA says.

The authority says that the most common types of cryptocurrency scams include fake initial coin offerings (ICOs) and crowdfunding ventures promising high yields in short term; eventually leading to platforms closing down and operators disappearing in an impromptu manner with the investor’s money. The watchdog also warns about fake exchange platforms and fake crypto wallet applications.

The MFSA has compiled the following 11-item checklist to help investors establish whether a proposed investment scheme can be trusted or not.

• Unrealistically high rates of return which are usually higher than the market average;
• Easy withdrawals which may be made at “anytime”;
• Promises that any funds deposited are 100% guaranteed;
• The business being unregulated;
• Lack of documentation or the use of documentation which is copied from a legitimate business;
• Aggressive selling techniques which put pressure and rush you to secure a sale;
• The absence of physical local offices;
• Contradiction between documents and spoken information;
• Not answering and avoiding hard questions;
• Lack of information being provided on the website, or within the whitepaper;
• The use of buzz words such as “no risks”, “gains guaranteed, become a billionaire”, “free services just register”.

“When investing, consumers of financial services are advised to proceed with caution and always make the necessary find-outs about the company,” the watchdog says. MFSA encourages users to check whether the company is regulated, which can be verified in the authority’s online Financial Services Register. When in doubt, consumers are welcome to get in touch with the MFSA via email or through their website.

“Consumers are also urged not to be fooled by the sensation of trust which these illegitimate platforms so often allude to. More importantly, one should take heed of the advice: if it seems too good to be true, it probably is,” the MFSA concludes.

The post MFSA warns against crypto scams, offers guidance first appeared on The Malta Business Weekly.

“Poor regulation enables corruption to flourish,” the Nauticus chief says, directing special attention to Pyramid and Ponzi schemes. “Unregulated exchanges are often hacked or shut down without returning the funds of users,” the chief warns.

Nauticus, however, mentions in its press statement that a handful of countries, including Switzerland, Malta and Australia, have embraced “well-designed regulations” for encouraging innovation while also protecting users.

“Verifying every user helps to fight corruption and criminality, and not only protects the business but protects our users themselves from fraudulent practices,” says Jonathan Chang, Chief Operating Officer of Nauticus, underscoring the gravity of know-your-customer (KYC) protocols.

Melbourne’s Nauticus Exchange is a digital financial marketplace offering 17 currencies and the Australian dollar. Nauticus is registered with the Australian Government’s AUSTRAC as a Digital Currency Exchange and an Independent Remittance Dealer. Headquartered in Melbourne, the company is a registered representative of an Australian Financial Services Licensee enabling it to tokenise assets in the form of security token offerings.

The post Nauticus CEO says good legislation can protect users from scams first appeared on The Malta Business Weekly.

The two companies expect to work closely to produce the ETx that will be directly linked with underlying assets listed on Zeus Exchange, whether those are stocks, or crypto stocks, or cryptocurrencies or other asset types, with an ability to receive an underlying asset at any given time, the press statement says.

“Blackmoon and Zeus Exchange share a very similar vision and it’s because of this that we are happy to have discovered such an incredible organization to partner with. We are eager to release the Zeus Exchange ETxs to offer this creative investment opportunity to investors across the globe,” said Oleg Seydak, CEO of Blackmoon

“Zeus Exchange strategy is to align with the best players in the field and build a diverse and liquid trading environment across the countries. We are happy to partner with Blackmoon over a whole investment class to trade at our platforms while offering the best of both in Asia and in Europe together,” said Olga Duka, CEO of Zeus Exchange

The post Blackmoon signs strategic partnership with Zeus Exchange first appeared on The Malta Business Weekly.