02-16-2018: Coinbase Error Duplicated Past Debit/Credit Cards Purchases

The executive director of the Bitcoin Foundation Llew Claasen predicted that the price of Bitcoin will hit $40,000 by the end of 2018, while 90% of all other cryptocurrency projects will fail. As Claasen stated at the Startup Grind conference which took place earlier this week, this failure will be caused by investors taking too much risk investing in cryptocurrency projects which later turn out to be scams. Only a month and a half into 2018, five major Initial Coin Offering (ICO) and cryptocurrency scams have already been discovered, including the notorious case of Bitconnect. Claasen is confident that the cryptocurrency community will learn from these unfortunate occurrences and will be able to prevent them in the future, as he told Business Insider. Claasen believes that investors are already being more careful, declaring that “this is a problem the market is good at solving” (cointelegraph).

Coinbase experienced one of the more egregious errors in recent cryptocurrency history by duplicating users’ past debit and credit cards and bank purchases, effectively siphoning money from accounts without authorization. The costly error reportedly left many users’ bank accounts completely drained. Some users on Reddit reported unauthorized transactions upwards of $50,000, while many others reported duplicated purchases on smaller transactions. Even those less affected have been left with a massive headache from filing support tickets with Coinbase, calling their banks, and disconnecting their linked accounts. Coinbase confirmed the mistake, but later passed the blame on to Visa – stating the “erroneous credit and debit charges are the result of Visa reversing and recharging transactions. This was not done by Coinbase” (bitcoinist).

The Commodity Futures Trading Commission (CFTC) has published a customer advisory regarding virtual currency pump-and-dump schemes. Stating “Customers should not purchase virtual currencies, digital coins, or tokens based on social media tips or sudden price spikes. Thoroughly research virtual currencies, digital coins, tokens, and the companies or entities behind them in order to separate hype from facts.” The CFTC noted that this malicious activity has been around for much longer than digital currencies. Now, cryptocurrency pump-and-dump schemes present several challenges to regulators. Exchanges might be located outside of the United States, they may not incorporate know-your-customer protocols, and the relative anonymity of cryptocurrency can make it difficult to track down bad actors (ethnews).

Tether has launched a fresh round of token creation, this month adding 86 mln euro-pegged EURT and 60.1mln dollar-pegged USDT to its issuance. Both tokens are issued on Ethereum, with two wallets currently showing the ongoing activity as Tether continues to face mixed press following volatility. Finance Magnates quoted an earlier announcement last September from Bitfinex sister exchange Ethfinex, the new tokens form part of a new collaboration bringing Tether to Ethereum. The ERC20 Tether allows for tokenised USD to be exchanged on the Ethereum network, enabling interoperability with Ethereum-based protocols and DApps while allowing users to transact with fiat currencies across the Ethereum Network (cointelegraph).

And lastly, select properties have gone up for sale for Bitcoin in San Diego. Canter Companies, San Diego’s leading financial and advisory investment firm, has just announced two multi-million-dollar properties up for grabs. Alan Ezier, one of the sellers, sees blockchain technology as a pillar of the future, and Bitcoin as a legitimate cryptocurrency creating an entirely new financial system. The properties are selling for roughly 800 to 1200 bitcoins at press time (bitcoinist).

This episode is sponsored by legitswag.store, a cryptocurrency apparel and accessories store.

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