21-Year-old Jailed for 10 Years After Stealing $7.7M in Crypto By Hacking Cell Phones

21-Year-old Jailed for 10 Years After Stealing $7.7M in Crypto By Hacking Cell Phones
             

A 21-year-old man has been sentenced to 10 years in prison

after becoming one of the first people in the United States to be convicted of stealing cryptocurrency by hacking into cell phones. Prosecutors in Santa Clara announced the jail sentence on April 22. In February, Joel Ortiz had pleaded guilty and to theft and accepted the 10-year plea deal.

Ortiz stole more than $7.5 million from at least 40 victims: the press release notes that he then spent $10,000 a time at Los Angeles nightclubs, hired a helicopter to fly him and his friends to a music festival, and bought top-end Gucci clothes and luggage.  In May 2018, one cryptocurrency entrepreneur in Cupertino lost $5.2 million in a matter of minutes, prosecutors note. Prosecutors described the one-time high school valedictorian as a “prolific SIM swapper who targeted victims to steal cryptocurrency and to take over social media accounts with the goal of selling them for bitcoin (BTC).”

Illegal SIM swaps often involve duping phone companies into switching cell phone numbers to a new SIM card by providing stolen addresses and social security numbers. From here, hackers can circumvent two-step authentication measures that are designed to keep crypto safe. Ortiz was detained at the Los Angeles International Airport last year, and investigators say they have only been able to recover $400,000 of the stolen funds. They believe the rest has either been hidden or spent.

Prosecutor Erin West said:

“These are not Robin Hoods. These are crooks who use a computer instead of a gun. They are not just stealing some ethereal, experimental currency. They are stealing college funds, home mortgages, people’s financial lives.”

Oritz had been sentenced on April 19 by a judge after two hearings where victims described the financial devastation caused by his crimes. In February in a separate case, an individual was indicted in New York for stealing identities and funds, including crypto, in the state’s first SIM swapping prosecution.

Article Produced By
Thomas Simms

Thomas is a British reporter who loves all things breaking news and crypto. When out of the office, he also likes backgammon and gin.

https://cointelegraph.com/news/21-year-old-jailed-for-10-years-after-stealing-75m-in-crypto-by-hacking-cell-phones

 

Everything But Crypto, Or How the ‘Crypto’ Movie Does Not Live Up to Its Name

Everything But Crypto, Or How the 'Crypto' Movie Does Not Live Up to Its Name
           

The best news for crypto enthusiasts about the movie “Crypto”

is that “Crypto” has very little to do with crypto. It is mainly concerned with Russian mafiosi, money laundering and a main character who plods through the heavy plot with the affect of a depressed zombie.

Cryptocurrencies do make three appearances in the movie:

1. It is revealed that a major bank, because (one character explains) such banks are terrified of being made irrelevant by cryptocurrencies, is secretly buying crypto in order to drive the price up, on the theory that high prices will make cryptocurrencies unaffordable and dissuade people from buying them. I am not sure this makes sense, since I was under the impression that rising prices make cryptocurrencies not less but more attractive to the general public (hence the bitcoin buying frenzy at $20,000). But this is not a major plot point.

2. The Russian mob, which is laundering money through that same bank, is doing some of its laundering by the use of crypto. The details of this are vague, but it is apparently being done in league with one of the bank’s employees, so #2 may be linked to #1 above. Or maybe not.

3. One major character — who owns a failing discount liquor store — is making a lot of money by investing in initial coin offerings. He is also mining crypto with a computer set-up in his store’s back room. It’s that easy!

All of this is explored, or stumbled upon, by the film’s main character, Martin Duran, played by Beau Knapp. Martin is allegedly a top-ranked business school graduate who has a fairly mundane job as a compliance officer for the major bank. After he angers the bank’s brass by nixing a proposed big client, he is punished by being transferred to the bank’s branch in his own home town, a small farming community. Although many scenes are set in that bank branch (which does not look like a bank), no customers ever appear. Regardless, Martin’s new job as the branch’s compliance officer involves a specific brief to keep an eye out for money laundering. I was not aware that individual bank branches had compliance officers, but never mind.

Martin’s attention is soon drawn to a high-end art gallery where pictures sell for millions of dollars. (We are told the town has a newly gentrified section, although we never see any of the gentry.) The women working at the gallery find Martin attractive, which is among the film’s least likely plot turns. Martin is a thin, sallow fellow who speaks in a low monotone and sports traces of what might or might not be an attempted beard. (Even a casual viewer may have the urge to tackle him to the ground and administer a shave.) He also wears the same dark suit, black tie and dress shoes in every scene, even when he is hiking through the woods on a date with an attractive gallery assistant played by Alexis Bledel (former star of “Gilmore Girls,” who deserves better).  She suggests he wear more appropriate shoes next time.

The gallery’s finances are suspicious, and indeed the place is linked to the Russian mob, represented locally by Vincent Kartheiser (of “Mad Men” fame, who ditto). The mob gets wind that Martin, with the help of his friend — the failing liquor store owner, who also happens to be a genius hacker — is looking into its affairs. The mob disapproves. Kartheiser gets his revenge by out-acting Knapp (Martin). Also there is mayhem and violence.

A parallel story involves Martin Duran’s family, from which Martin has been estranged. His brother (played by Luke Hemsworth), a damaged Iraq war veteran, is no happier to see Martin than we are. His widowed farmer father, played by Kurt Russell in one of the grimiest t-shirts ever seen onscreen, is gruff but affecting and seems to harbor the wish that his boys will reconcile. In the end (spoiler alert!), they do. And all is well. Martin departs the depravities of Wall Street to return to the family farm, where he helps his father and brother dig up potatoes. Martin and his brother smile for the first time in the film. And Martin sets up a crypto mining operation in a home office. After all, it’s that easy, right?

Article Produced By
Edward Zuckerman

Edward Zuckerman is a journalist and an Emmy-winning television writer.

https://cointelegraph.com/news/everything-but-crypto-or-how-the-crypto-movie-does-not-live-up-to-its-name

Microsoft Korea: Country Faces Growing Threat From Stealth Crypto Mining Attacks

Microsoft Korea:
Country Faces Growing Threat From Stealth Crypto Mining Attacks

Microsoft Korea has claimed the country is facing

an increase in cryptojacking incidents, according to a report from local English-language daily The Korea Times, published on April 22. The findings were announced by Microsoft security program manager Kim Gwi-ryun during a press conference in Seoul today, which accompanied the release of the annual Microsoft Security Intelligence Report.

As previously reported, cryptojacking is the practice of using a computer’s processing power to mine for cryptocurrencies without the owner’s consent or knowledge. According to The Korea Times, South Korea's cryptocurrency mining incident rate in 2018 was 0.05% —  reportedly 58% lower than the world average.

Nonetheless, Kim Gwi-ryun isolated the malicious practice from among other cybersecurity attack vectors detected in the country — such as supply chain malware and phishing attempts. The representative noted that Microsoft has detected market correlations in the fluctuating prevalence of cryptojacking,

stating that:

"We have noticed that as the value of cryptocurrency rises and falls, so does the mining encounter rate."

As the report notes, stealth cryptojacking is difficult to detect and largely manifests itself in compromised system performance due to the intensive drain on processing power that crypto mining presents. As Cointelegraph has reported, cryptojacking was cited in a recent criminal conviction of two Romanian alleged cybercriminals, who had been tracked in a joint investigation by the United States Federal Investigation Bureau and the Romanian National Police.

A March 2019 report from AT&T Cybersecurity revealed that cryptojacking was one of the most prevalent objectives of hackers targeting businesses’ cloud infrastructures, despite the crypto bear market. That same month, reports surfaced of a new strain of Trojan malware for Android phones. The malware reportedly targets worldwide users of top crypto apps such as Coinbase, BitPay and Bitcoin Wallet, as well as banks including JPMorgan, Wells Fargo and Bank of America.

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Marie Huillet

Marie Huillet is an independent filmmaker, with a background in journalism and publishing. Nomadic by nature, she’s lived in five different countries this decade. She’s fascinated by Blockchain technologies’ potential to reshape all aspects of our lives.

https://cointelegraph.com/news/microsoft-korea-country-faces-growing-threat-from-stealth-crypto-mining-attacks

Crypto Developer Raises $4 Mln From Samsung, Others to Launch Wallet Without Private Keys

Crypto Developer Raises $4 Mln From Samsung, Others to Launch Wallet Without Private Keys

                                 

Israeli cryptocurrency developer KZen has raised $4 million

from backers including South Korean electronics giant Samsung, industry news outlet The Block reported on April 17. The company’s product, smartphone wallet app ZenGo — currently in beta phase testing — aims to simplify custodial wallet usage for entry-level cryptocurrency users. Using a combination of split key storage and biometric security features, the company hopes users will be able to benefit from a simple wallet user interface while not relying on a third party or themselves to hold their private keys and other sensitive information.

A smartphone and cloud storage form the two sharers of information needed to sign a transaction, part of a setup called threshold signatures. “ZenGo uses open source threshold cryptography to replace the private key and all the troubles related to securely managing non-custodial wallets,” CEO and cofounder, Ouriel Ohayon, wrote in a blog post on April 15.

He added:

“Our solution eliminates the typical friction points of onboarding and backup and does so without the existence of a single point of failure.”

Other sponsors of the investment round included Elron and Benson Oak Ventures. The product builds on a trend that fellow custody startup Casa began with its mobile app Keymaster. Casa, however, only supports bitcoin (BTC), whereas ZenGo does not limit users to specific tokens. Regarding the security of the cloud server aspect needed for transactions to work, Ohayon told The Block that extra backup procedures would appear following launch. The private beta is currently available on iOS, with an Android equivalent to follow.

Article Produced By
William Suberg

William Suberg got into Bitcoin while completing his Masters degree and hasn't looked back since, writing about anything crypto-related which makes him sit up and pay attention. He started working with Cointelegraph in October 2013.

https://cointelegraph.com/news/crypto-developer-raises-4-mln-from-samsung-others-to-launch-wallet-without-private-keys

Coinbase’s 2018 Revenue Is 60% Less Than Projected by the Firm: Report

Coinbase’s 2018 Revenue Is 60% Less Than Projected by the Firm: Report

                                 

Major global crypto exchange Coinbase reportedly

saw around $520 million in revenue last year, Reuters reported on April 18. The publication calculated the sum by looking at a filing to Britain’s corporate registry last week showing Coinbase’s non-U.S. revenue equaled around 154 million euros ($173 million), noting that a Coinbase executive once stated that the non-U.S. revenue is equal to almost one third of the overall revenue Based on Reuters’ calculations of Coinbase’s 2018 revenue, the crypto exchange has generated 60% less than its stated plans.

In late October 2018, Bloomberg published an article claiming that Coinbase had projected that it would see $1.3 billion in revenue in 2018. Based on unspecified documents, Bloomberg wrote that the San Francisco-based crypto exchange foresaw significant revenue from commissions on trades, as well as from gains and losses in its crypto holdings, despite the bear market.

In January 2018, industry sources reported that Coinbase made about $1 billion in revenue in 2017, overshooting its forecast for that year by 66 percent. The Cointelegraph team has not found any official data from Coinbase about its revenue for either 2017 or 2018. Founded in 2012, Coinbase is a major crypto trading and wallet service based in the United States. Recently, the exchange was featured in LinkedIn’s list of the most popular companies for 2019, with Coinbase placed at 35 out of a total of 50 companies. Coinbase Pro is currently ranked 43rd among global crypto trading markets by adjusted daily trading volume.

On April 17, Coinbase expanded its crypto-to-crypto trading offering to 11 countries in Latin America and Southeast Asia, including Argentina, Mexico, Peru, as well as South Korea, Indonesia, the Philippines and others. Meanwhile, Binance, currently the third largest crypto exchange, was recently reported to have made $78 million in profits in Q1 2019, up 66% from the previous quarter. the Reuters article, the publication reported that venture capital investments in crypto and blockchain startup have the potential to set an all-time high in 2019, as investors also appear to be contributing larger amounts per deal.

Article Produced By
Helen Partz

Helen is passionate about learning languages, cultures and the Internet. She has years of experience working at international online advertising projects. Growing interested in Bitcoin and cryptocurrencies in late 2017, she joined Cointelegraph as a writer.

https://cointelegraph.com/news/coinbases-2018-revenue-is-60-less-than-projected-by-the-firm-report

 

Romanian Central Bank Official Says Crypto Will Not Fulfil Basic Roles of Currency

Romanian Central Bank Official Says Crypto Will Not Fulfil Basic Roles of Currency

                                

An official from the Romanian central bank has stated that cryptocurrency

will not replace currency issued by central banks as it is not necessarily a currency. The news was published by local media outlet Business Review on April 16. Daniel Daianu, a member of the Romanian National Bank (BNR)’s Administration Council, reportedly stressed the necessity to be aware of the difference between institutions and their roles, ensuring that those roles will not disappear. Daianu also addressed the importance of making the distinction between blockchain technology and digital currencies.

Daianu said:

“In my opinion, these are financial assets, not cryptocurrencies, and they won’t be able to fulfil the basic roles of currency. […] Cryptocurrencies will never be able to substitute the currency issued by a central bank. What can happen is for central banks to have a digital currency, but that will also be issued by the bank, and commercial banks will receive digital currency that can multiply. I do agree, however, that new technologies lead to disintermediation and this feature of decentralization shows us the merits of networks.”

Romania — which became the first Eastern European chapter affiliate of American nonprofit corporation Bitcoin Foundation back in 2014 — released a draft Emergency Ordinance that regulates the issuance of electronic money (e-money) last July. The draft reportedly described electronic money as “monetary value stored electronically, including magnetic, representing a claim on the issuer issued on receipt of funds for the purpose of performing payment transactions and which is accepted by a person other than the issuer of electronic money.” A recent report from the World Economic Forum (WEF) revealed that at least 40 central banks globally are conducting research projects and pilots with blockchain technology that aim to address such issues as financial inclusion, payments efficiency and cybersecurity. The WEF provided ten use cases for distributed ledger technology ?t central banks including the development of retail central bank currency, among others.

Article Produced By
Ana Alexandre

Total change in her career took Anastasia into the world of analytics and business information as a researcher and translator in 2010. Some time later she got into FinTech, a dynamically developing segment at the intersection of the financial services and technology. Ana joined Cointelegraph in September 2017.

https://cointelegraph.com/news/romanian-central-bank-official-says-crypto-will-not-fulfil-basic-roles-of-currency

Coincheck Owner Mulls Addition of Crypto to Its Retail Offerings

Coincheck Owner Mulls Addition of Crypto to Its Retail Offerings

                                 

Online brokerage Monex Group Inc.,

owner of the hacked Japanese crypto exchange Coincheck, is considering adding crypto to its retail client offerings in a bid to become more competitive in the local brokerage market. The news was reported by Bloomberg on April 15. As previously reported, Monex acquired Coincheck in April 2018 in the wake of the exchange’s industry record breaking $532 million hack in January of that year.

According to Bloomberg, Monex now sees its Coincheck involvement as potentially instrumental in restoring its erstwhile market dominance. Founded in 1999, Monex was reportedly once the country’s most popular online brokerage, but has since reportedly been eclipsed by rivals such as Rakuten, SBI Holdings and Mastui. Monex’s brokerage unit is thus mulling the addition of digital currencies to its offerings for retail clients in collaboration with Coincheck. Monex Securities Inc.’s new president, Yuko Seimei, conceded that a new strategy is critical to

reviving the firm:

“We’ve fallen a little behind — we can’t deny that. If we keep doing things the way we have, we may not be able to close the gap.”

Amid increasing competition in the brokerage market, Japanese investors’ enthusiasm for cryptocurrencies could help the organization reclaim clients, Bloomberg notes. The Japanese yen currently accounts for ~46.5% of national fiat currencies traded for bitcoin (BTC), according to crypto statistics site Coinhills. As reported, under the stewardship of Monex, Coincheck took a series of measures to improve its protection and trading systems, as well as reimbursing those customers affected by the hack. In mid-November 2018, Coincheck resumed crypto trading and was granted an operating license from Japan’s Financial Services Agency in December 2018. Monex Group’s financial report on Q3 for the 2019 fiscal year revealed that Coincheck had halved its losses in Q3, as compared with the preceding quarter.

This March, Monex announced major changes to its management composition, appointing three Coincheck executive directors to Monex roles to enhance cooperation between the two firms. This week, Money Forward Inc., the operator of one of Japan's most popular personal budgeting apps, announced a decision to halt its plans to launch a crypto asset exchange, citing profitability concerns amid the bear market. Japanese e-commerce giant Rakuten has meanwhile just opened registration for users of its crypto exchange Rakuten Wallet, which is set to go live in June.

Article Produced By
Marie Huillet

Marie Huillet is an independent filmmaker, with a background in journalism and publishing. Nomadic by nature, she’s lived in five different countries this decade. She’s fascinated by Blockchain technologies’ potential to reshape all aspects of our lives.

https://cointelegraph.com/news/coincheck-owner-mulls-addition-of-crypto-to-its-retail-offerings

94% of Surveyed Endowment Funds are Allocating to Crypto Investments: Study

94% of Surveyed Endowment Funds are Allocating to Crypto Investments: Study

                                  

94% of endowments have been allocating to crypto-related investments

throughout 2018, a new survey published on April 12 reveals. The study was conducted in Q4 2018 by trade publications Global Custodian and The Trade Crypto, in partnership with blockchain security firm BitGo. Out of 150 surveyed endowments, 89% of the respondents were reportedly based in the United States, with the rest either in the United Kingdom or Canada.

The survey indicated that despite widely-reported concerns around regulation, custody and liquidity, endowments will continue to allocate investments to the new asset class — with only 7% of respondents saying they anticipated any decrease in their allocations over the next year. Jonathan Watkins, managing editor at Global Custodian and The Trade, remarked on the results of the survey,

stating that:

“All the talk over the past 18 months has been around when institutional investors will begin participating in cryptocurrency investments, but it turns out they had already arrived, in the form of endowment funds.”

The survey reportedly revealed that 54% of respondents were directly investing in crypto assets, with 46% investing via various kinds of funds. Over the next 12 months, 50% revealed they expect to increase their crypto investments, with 45% anticipating their allocations will remain at their current levels.

According to the survey, the top three characteristics that endowments are seeking when they select crypto funds are that they comply with robust regulation, have sufficient capital flow and liquidity and offer account security. The Trade suggests cautious optimism is an apt overall summary of endowment sentiment in regard to the nascent asset class, citing one respondent’s belief that crypto “is the future of investing,” and others’ characterizations of the process as “a very wild ride” and “hair-raising.” As reported, this February, the University of Michigan’s $12 billion endowment unveiled plans to bolster its investment in a crypto fund managed by U.S. venture capital firm Andreessen Horowitz.

Details of reported crypto fund investments from Ivy League titans Yale and Harvard surfaced in fall 2018 — the latter of whose ~$39.2 billion endowment for the 2018 fiscal year was the largest of any university endowment globally. Crypto investment claims have also been made for Stanford University, Dartmouth College, the Massachusetts Institute of Technology and the University of North Carolina. As reported this month, Harvard’s endowment is set to become a direct investor in a planned $50 million token sale from decentralized computing network Blockstack. If approved, the sale would be the industry’s first Securities and Exchanges Commission-qualified offering.

Article Produced By
Marie Huillet

Marie Huillet is an independent filmmaker, with a background in journalism and publishing. Nomadic by nature, she’s lived in five different countries this decade. She’s fascinated by Blockchain technologies’ potential to reshape all aspects of our lives.

https://cointelegraph.com/news/94-of-surveyed-endowment-funds-are-allocating-to-crypto-investments-study

Cryptocurrency Price Trends Could Signal End of Bear Market, Says Binance Research

Cryptocurrency Price Trends Could Signal End of Bear Market, Says Binance Research

                               

Bitcoin (BTC) prices and altcoin prices could have already hit their lowest point,

new analysis from cryptocurrency exchange Binance concluded on April 11. In the latest edition of its research bulletins, the exchange’s dedicated analytics arm, Binance Research, investigated various current phenomena and trends within cryptocurrency markets. Among them was correlation between Bitcoin and altcoin prices, data from 2014-2019 confirming that the 90 days to mid-March represented the longest period of high correlation in market history. According to historical behavior, such periods tend to trigger trend reversals. The 90 days to mid-March incorporated Bitcoin’s drop from $6,500 to around $3,100, leading Binance to suggest that markets could now rebound following the end of the record correlation period.

“Having emerged from a period of the highest internal correlations in crypto history, the data may support the notion that the cryptomarket has already bottomed out,” the exchange summarized. As Cointelegraph reported, Binance had previously eyed the changing relationship between Bitcoin and altcoin prices, concluding altcoins were becoming less correlated with Bitcoin but more so against USD. The latest bulletin also held insights about cryptocurrency’s investor makeup: institutional investors control around 7% of the supply, Binance says, roughly equal to one-thirteenth of the institutional control of the United States stock market.

Last week, another well-known voice meanwhile endorsed the narrative that crypto markets had bottomed. Thomas Lee, senior market analyst and co-founder of Fundstrat Global Advisors, pointed to three-year high readings on his so-called “Bitcoin Misery Inde (BMI) as potential proof that no further downside would occur. “The main takeaway is […] further evidence the bear market for Bitcoin likely ended at $3,000,” he wrote on Twitter on Thursday.

Article Produced By
William Suberg

William Suberg got into Bitcoin while completing his Masters degree and hasn't looked back since, writing about anything crypto-related which makes him sit up and pay attention. He started working with Cointelegraph in October 2013.

https://cointelegraph.com/news/cryptocurrency-price-trends-could-signal-end-of-bear-market-says-binance-research

Ethereum Core Developers Consider More Frequent and Smaller Hard Forks

Ethereum Core Developers Consider More Frequent and Smaller Hard Forks

                                 

Ethereum (ETH) core developers are considering implementing

more frequent and smaller hard forks, according to the most recent bi-weekly meeting held on April 12. The question of time between hard forks — or network updates — was brought up by the meeting’s moderator, Tim Beiko, who referenced it as an ongoing topic of discussion. Another dev then began the discussion by referencing core developer Alexey Akhunov’s previously expressed position in favor of shorter periods between forks.

To “check the temperature” of the devs’ position on hard fork timing, the dev asked if anyone on the call was “open to hard forks as short as three months.” The first three responses to the question were negative or tentative, with dev Joseph Delong calling three months “too quick […] for turnaround.” Another developer, Martin Holst Swende, then summarized the sentiment,

stating:

“as long as we’re not tied to large hard forkes every three months. So, more like opportunity windows, when things are finished.”

Another dev then pointed out that the team had yet to complete a hard fork within six months, suggesting that “there a couple of things we probably need to automate to be able to do that really well.”

The devs also referenced the topic as being previously discussed on the Ethereum developer forum Ethereum Magicians. In the discussion’s initial post, dated March 15, Beiko laid out the pros and cons of smaller and more frequent hard forks, noting that the team had discussed the topic on its dev call that same day. Some of the arguments in favor include that such a move would bring more frequent updates to the protocol and would also allow the team to separate concerns and isolate changes better and decrease the deployment time of updates that require multiple forks. Further, the testing process would be arguably easier since there would be fewer EIPs to test and fewer EIP interactions to check.

Still, arguments for larger and less frequent hard forks were also presented, such as the fact that they leave ample time for security evaluation. Less frequent hard forks require less frequent client updates and user coordination. In the case of frequent hard forks, a bug in a fork also risk delaying the next fork. As Cointelegraph reported earlier this week, a report released by decentralized application (DApp) analytics website DApp.com revealed that Tron (TRX) has the fastest growing DApp user base while Ethereum’s DApp user base is shrinking. Also this week, Charles Hoskinson, the co-founder of Ethereum and IOHK, the company behind Cardano (ADA), criticized Ethereum and Eos’s (EOS) approach to development.

Article Produced By
Adrian Zmudzinski

Adrian is a newswriter based out of Pisa, Italy. He's passionate about cryptocurrency, digital rights, IT, tech and futurology and likes to think about the future in a positive way.

https://cointelegraph.com/news/ethereum-core-developers-consider-more-frequent-and-smaller-hard-forks