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dYdX Faces Censorship and Centralization Criticism for Blocking User Accounts

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dYdX Faces Censorship and Centralization Criticism for Blocking User Accounts
  • dYdX is facing criticisms of centralization and censorship from the crypto community over recent blockings.
  • A few users have been sent messages saying that they have been permanently blocked for jurisdictional reasons.
  • Executives from Starkware, associated with dYdX, are looking into the matter, saying that it was weird and unexpected.

Decentralized exchange dYdX is facing criticisms of centralization and censorship as users and notable figures in the crypto space take to Twitter and forums to post their worries. Banteg, a crypto user associated with the yearn.finance project, posted a tweet about how he had been blocked from using the platform. The blockings appear to be quite out of the blue, which suggest it might be unintentional, though there are few details on the development.

Similarly, an anonymous user posted on the dYdX forum about the same issue, saying that he had been given the message “I’m a resident or trading from a jurisdiction that violates terms of use of dYdX.” The exchange has not commented on the matter at the time of publishing.

These incidents have been occurring in at least the last two days, with the forum post taking place on April 23 and banteg’s tweet on April 25. There haven’t been too many more public statements on these blockages.

Louis Guthmann, ecosystem lead at Starkware, spoke about how it was weird that banteg was blocked from making fast withdrawals within Starkware. He is communicating with banteg about it, though there has been no update.

That’s a very weird message. We are not in charge of that

— Louis Guthmann 🦇🔊✨ | 🐺-Maxi (@GuthL) April 25, 2022

The crypto community has been criticizing the exchange for its apparent lack of decentralization. It’s not quite clear what is going on, but the fact that users can be banned at all without little notice is enough to raise this flak.

Exchanges Will Want To Ensure Decentralization, but Regulation Looms

The issue on dYdX seems to be an odd case, without it really being clear what is going on. If dYdX is indeed locking out users by jurisdiction, then that is going against the very principles of decentralization. The fact that one executive on the platform has hinted that it shouldn’t be happening suggests that it may be some sort of bug.

However, this general idea of users being blocked by jurisdiction is something that centralized exchanges have adhered to. Regulators are keen to ensure that crypto doesn’t operate where they don’t want it to — like Russia, for example. Decentralized exchanges have acted as avenues of escape for these jurisdictions.

Regulators are taking note of decentralized platforms, though they admit implementing regulation is difficult. Even without these laws looming, there are incidents when services can stop. MetaMask accidentally halted services in Venezuela, which is notable because of its significant role in the DeFi space.

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Ethereum

Litecoin Under Scrutiny By S. Korean Exchanges of Upbit, Bithumb After it Introduces Privacy Through MimbleWimble

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Litecoin Under Scrutiny By S. Korean Exchanges of Upbit, Bithumb After it Introduces Privacy Through MimbleWimble

Quick take:

  • Litecoin’s MimbleWimble privacy protocol has resulted in some South Korean exchanges issuing warnings about LTC.
  • Upbit and Bithumb have advised crypto users of the risks associated with the privacy upgrade.
  • Both exchanges cited South Korea’s Act on the Reporting and Use of Specific Financial Transaction Information.

Bitcoin’s little brother, commonly known as Litecoin (LTC), has captured the attention of South Korean exchanges after the implementation of the highly anticipated MimbleWimble upgrade.

The two popular South Korean crypto exchanges of, Bithumb and Upbit, have each released statements warning their user-base of the risks associated with the privacy-centric upgrade. Litecoin’s new upgrade introduces features that block transactional information.

Both exchanges cited the country’s Act on the Reporting and Use of Specific Financial Transaction Information as a basis for the respective notifications. In particular, the Act requires all crypto exchanges in South Korea to implement know-your-customer (KYC) procedures and anti-money laundering (AML) processes.

Upbit and Bithumb Have Delisted Privacy Coins Before

To note is that South Korean exchanges have had a history of delisting cryptocurrencies that are focused on privacy, such as Monero (XMR), Dash (DASH), and ZCash (ZEC). The recent warning of Litecoin for similar reasons could hint at a potential delisting of LTC by both exchanges in the near future.

Such a possibility was explored by the team at WuBlockchain, who stated the following:

South Korean exchanges such as Upbit issued a warning that the MimbleWimble Extension Blocks (MWEB) conducted by the LTC Foundation made the LTC transfer records unrecognizable. This warning may develop into the delisting of LTC in the future.

Litecoin Recaptures $70 Support But Remains in Bear Territory

Concerning price, Litecoin is now trading at $72 after recapturing the crucial $70 support level. However, Bitcoin’s little brother is still trading in bear territory below the 50-day (white), 100-day (yellow), and 200-day (green) moving averages, as seen in the chart below.

Litecoin Under Scrutiny By S. Korean Exchanges of Upbit, Bithumb After it Introduces Privacy Through MimbleWimble 12

Also, from the chart, it can be observed that the daily MFI, RSI, and MACD are all pointing towards renewed buying of Litecoin (LTC), which could lead to a push towards $80. But, Litecoin’s fate in the crypto markets is tied to that of Bitcoin, which is connected to the traditional markets currently under the influence of the mood set by the US Federal Reserve, increasing interest rates to tame inflation.

Consequently, caution is advised when trading Litecoin, more so with the warnings issued by Bithumb and Upbit.

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Bitcoin Miners in China Defy Crypto Mining Ban, Now Ranked 2nd in BTC Hashrate

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Bitcoin Miners in China Defy Crypto Mining Ban, Now Ranked 2nd in BTC Hashrate

Summary:

  • Bitcoin miners based in China now control 21.1% of BTC’s hashrate.
  • China is now ranked second in Bitcoin’s hashrate, hinting at the existence of covert mining facilities.
  • This is despite China’s government reiterating in May 2021 its ban on Bitcoin mining and crypto trading.
  • Due to the ban, the dominance of Bitcoin miners based in China had dropped from almost 50% in May 2021 to 9% in July 2021.

China has once again reemerged as a significant contributor to the Bitcoin (BTC) network despite the country’s government reissuing a blanket ban on crypto mining back in May 2021. According to data from the Cambridge Bitcoin Electricity Index, Bitcoin miners based in China are now ranked second in terms of the total hashrate of the BTC network.

The United States is Now at the Top in terms of Bitcoin Hashrate.

The chart below, courtesy of the hashrate tracking website by Cambridge, shows China (yellow) slowly recovering its hashrate beginning mid-2021 and after the reissuance of the mining ban. Also, from the chart, it can be observed that the United States (pink) has slowly grown over the years to now provide a majority of Bitcoin’s hashrate.

Bitcoin Miners in China Defy Crypto Mining Ban, Now Ranked 2nd in BTC Hashrate 11
Bitcoin Hashrate as of May 2022. Source, CCAF.io/cbeci/mining_map

China Now Controls 21% of Bitcoin’s Hashrate

In terms of percentage, China now controls 21.1% of the global Bitcoin hashrate, with the United States at 37.8%. The chart below, also courtesy of the Cambridge Bitcoin Electricity Index website, highlights how China’s hashrate dominance (yellow) has fluctuated over the years.

Bitcoin Miners in China Defy Crypto Mining Ban, Now Ranked 2nd in BTC Hashrate 12
China (yellow) now has a 21.1% share of Bitcoin’s hashrate. Source, CCAF.io/cbeci/mining_map

The chart shows that China controlled almost 50% of Bitcoin’s hashrate before its government reissued a complete ban on Bitcoin and crypto mining back in May 2021. By July and August of the same year, China’s hashrate dominance had plummeted to 9.4%. However, the chart hints that Bitcoin miners started fresh operations by September of last year, resulting in China now controlling 21.1% of Bitcoin’s hashrate.

The Resurgence of Hashrate Points Towards Covert Bitcoin Mining Facilities in China

As to why China is now ranked second in Bitcoin hashrate, a recent report by Bloomberg concluded that the country has seen a sudden surge in BTC mining through ‘covert mining operations.’

China FUD Banning Bitcoin Mining Might be Around the Corner

To note is that China has banned Bitcoin and crypto mining on numerous occasions over the years, with the most notable being January 2018 and May 2021. The resurgence of Bitcoin mining activities in China could thus hint at another ban around the corner that might result in panic selling in the crypto markets, as was the case after the last two bans by the Chinese government.

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Legendary Hall of Famer Magic Johnson to Release NFTs in Partnership with NBA Top Shot

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Legendary Hall of Famer Magic Johnson to Release NFTs in Partnership with NBA Top Shot

Quick take:

  • Earvin Magic Johnson is set to release his very first NFTs in partnership with NBA Top Spot.
  • The NFTs with be in the form of an Anthology set reserved for iconic plays from NBA legends.
  • Magic Johnson’s NFTs will be available on June 7th and contain rare and spectacular moments of his career.
  • The NFTs will be in 1,600 packs, each retailing for $399.

The Legendary NBA Hall of Famer, Earvin Magic Johnson, has announced via Twitter that he intends to launch his first NFT collection in partnership with NBA Top Spot.

I’m really excited to partner with @nbatopshot to release my first NFTs and bring some of my favorite Moments from my career to fans everywhere. Fans get to see just a few of my favorite plays from my career! https://t.co/5hGKT6BwiJ pic.twitter.com/7egr3xBZsv

— Earvin Magic Johnson (@MagicJohnson) May 23, 2022

Magic Johnson’s NFTs Will be in the form of an Anthology

Magic Johnson is a five-time NBA champion, a three-time finals MVP, a three-time NBA MVP, a twelve-time NBA All-star, and a member of the NBA’s 75th Anniversary Team. His NFTs, in collaboration with NBA Top Shot, will be in the form of an Anthology set ‘reserved for iconic plays from NBA legends.’

The NFT collection will drop on June 7th and contain rare and legendary Magic Johnson moments.

A total of 1,600 anthology packs will be issued, and each will retail at $399. Within each pack will be one of four Magic Johnson moments that took place in seasons when he won the NBA Championship with the Los Angeles Lakers. Each Anthology pack will contain ‘a single guaranteed Magic Johnson Moment NFT in either the Legendary or Rare tier.’

The NFTs will Feature 4 Magic Johnson Moments.

The four Magic Johnson moments to be featured in the NFT collection are as follows:

  • Never Fear, E.J. Is Here: during game six of the 1980 NBA finals, Magic Johnson was started at center against the Philadelphia 76ers despite being a rookie. Magic went on to post 42 points, 15 rebounds, 7 assists, and 3 steals. His performance during the game will be memorialized with a fearless and-one layup against the 76ers.
  • Now You See it, Now You Don’t: in the 1984 – 85 season, one of Magic Johnson’s assists during the victory over the Phoenix Suns will be immortalized in the NFTs. Magic’s assist ‘starts with the 6’9 guard grabbing a rebound, leading the transition fast break, deceiving a duo of defenders with a dynamic handle and dishing a dime for an emphatic slam.’
  • Hocus Pocus Pass: Magic Johnson’s rare assist moment in the 133 – 115 victory against the San Antonio Spurs will also be turned into an NFT. During the game in the 1987 – 88 Championship season, Magic conjured an assist that was ‘more special and mind-bending than a head fake and ball fake combo.’
  • Game. Set. Magic: In the 1986 – 87 finals between the Los Angeles Lakers and Boston Celtics, Magic Johnson denied the Celtics a victory by ‘[catching] an inbounds pass along the baseline and instantly turns into a running, one-footed leaping bank shot over a double team that bounces off the glass right through the net and beats the buzzer for the surprise 115-114 victory.’

[Feature image courtesy of Magic Johnson on Twitter]

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