The United States county of Missoula, in the state of Montana,

has adopted regulation for cryptocurrency mining, local media outlet the Missoulian reports on April 5. Per the report, the Missoula County Board of Commissioners voted unanimously to impose new rules for local cryptocurrency mining operations. As Cointelegraph reported last month, when the regulation was first proposed, the draft of the rules stated that they aim “to protect the public health, safety, morals, and general welfare of county residents.” The focus of the new law is seemingly on the possible effects of cryptocurrency mining on global warming and electronic waste. Also, from now on, crypto miners in the county will be able to establish their operations only in light industrial and heavy industrial districts and only after they have been reviewed and approved as a conditional use.

Miners will also need to provide certification that all electronic waste generated will be handled by a Department of Environmental Quality-licensed recycling firm. Another new rule established in the county requires miners to use exclusively renewable energy. Lastly, preexisting mining operations that aren’t compliant will be allowed to continue but won’t be authorized for expansion if they don’t conform with the new regulations. The draft specified that the rules will be effective as of April 4, 2019 and until April 3, 2020.

The Missoulian notes that the county’s staff claim mining company Hyperblock currently uses as much electricity as one-third of all homes in the county and plans to triple its power usage. Hyperblock reportedly purchases hydroelectric power to fuel its endeavors, but the commissioners reportedly argued that it displaces other potential renewable energy buyers. County commissioner Dave Strohmaier purportedly

commented:

“Near as I can tell cryptocurrency is using exponentially more energy; it’s a grotesque amount of energy and we’ve got to take steps to address it. […] We’ve got to utilize new renewables if we’re going to address climate change.”

Hyperblock manager Dan Stivers defends the company by stating that it has always used only renewable energy and that it could have used electricity obtained by burning coal since it was cheaper. Stivers also claims that Hyperblock uses a licensed recycler to deal with its electronic waste,

adding:

“Somehow none of that’s enough. It is a viable business model and if we had not moved in as anchor tenants, there would be no Bonner mill as we see it today.”

According to the Missoulian, a lawyer for the company hinted that it may file a lawsuit over the regulation in the future. As Cointelegraph reported earlier today, the secretary of Hong Kong’s Financial Services and the Treasury has stated that crypto mining operations are regulated by local trading law.

Article Produced By
Adrian Zmudzinski

https://cointelegraph.com/news/montana-county-adopts-regulation-requiring-crypto-miners-to-use-renewable-energy

Browser-based blockchain payments system Nimiq has acquired

a 9.9 percent stake in Germany’s WEG Bank AG, according to an official announcement published on April 3. The stake acquisition comes as part of Nimiq’s new strategic partnership with WEG Bank AG and Swiss-Maltese decentralized cryptocurrency exchange (DEX) Agora.Trade. The three partners are working to create a crypto-to-fiat bridge that would allow for the seamless exchange of value between crypto and traditional banking systems, the announcement states. As today’s post notes, their approach — using a decentralized exchange such as Agora.Trade as a vital component — focuses on crypto-fiat value transfers that do not rely on a single, centralized intermediary (such as a centralized crypto exchange or payment processor), and eliminate the need to entrust crypto asset owners’ private keys to a third party.

The evolving project, dubbed Nimiq Oasis, will aim to connect different cryptocurrency markets via the non-custodial exchange Agora.Trade to WEG’s system, which notably has access to the Europe-wide SEPA Instant Banking Network. SEPA support could prospectively enable the project to roll out its crypto-fiat services with access to a network of over 2,000 banks across 20 European countries, Nimiq notes, proposing a targeted rollout time of before the end of 2019. The partners’ aim to enable the exchange of value between the crypto and fiat systems includes a focus on making fiat deposits at WEG blockchain compatible. While today’s announcement only alludes to this in principle, an earlier post from Nimiq clarified that the project

aims to:

“Establish the Euro itself as the programmable counterparty to a non-custodial cross-chain transaction. In simple terms, it means that in a transaction to buy or sell Crypto, the counterparty could now be a Euro account holder.”

Notably, both the Litecoin (LTC) Foundation and crypto-fiat payments firm TokenPay each own a 9.9 percent stake in WEG AG Bank — a fact that Nimiq today notes could open up the possibility of further collaborations between the bank and the crypto firms. All three stakeholders’ shares are capped at 9.9 percent, as under German banking law, no entity can own more than 9.9% of a bank without additional regulatory approval. Securing fiat liquidity for non-custodial, decentralized exchanges has to date been slower than for their centralized counterparts. Major American centralized crypto exchange Coinbase has gone a step further by pursuing its own federal banking charter since spring of last year.

Article Produced By
Marie Huillet

https://cointelegraph.com/news/nimiq-acquires-99-stake-in-germanys-weg-ag-to-become-banks-third-crypto-firm-owner

Puerto Rico-based cryptocurrency trading platform San Juan Mercantile Exchange (SJMX)

has launched banking operations via a new subsidiary, the company announced in a press release on April 2. SJMX, which exists as a membership-based exchange for digital asset traders, is seeking to expand the scope of its operations for institutional investors.

The new venture, dubbed San Juan Mercantile Bank & Trust International (SJMBT), received a banking license from Puerto Rican regulators last month. With the receipt of its first deposit, the bank is now officially open for business, offering institutional clients more of an all-round package of services for their trading needs. “Commencing SJMBT banking operations is a significant milestone,” SJMBT president and chief operating officer, Nick Varelakis, commented in the press release.

He added:

“Institutional market participants in the digital asset space now have access to a licensed, fully regulated and operational banking partner that provides a secure environment for the matching and settlement of digital asset trades.”

The news comes on the back of rapid expansion of institutional services worldwide. As Cointelegraph reported earlier Tuesday, Hong Kong-based BC Group has also launched Asia’s first insured crypto custody solution. Market sentiment over institutional investor entry remains mixed as United States regulators continue to mull long-delayed offerings, such as trading platform Bakkt. Originally slated for November, the project has seen multiple setbacks, while authorities say they are addressing the application, and others like it, as a matter of urgency.

Article Produced By
William Suberg

https://cointelegraph.com/news/puerto-rico-sees-new-crypto-bank-accept-first-client-deposit

Ethereum-based (ETH) prediction market Augur is currently facing a design flaw attack,

according to research by cryptocurrency exchange Binance released on April 1. The aforementioned attack involves a controversial market described as betting on the price of ETH at the end of March, which expired on April 1, 2019, 1:59 AM (UTC +8), a few hours off from the actual end of March 31. Since the contract expires before that tie, it may be deemed invalid in what Binance researchers call a design flaw attack. The market has also been reportedly wash traded by a few wallets, presumably to inflate the volume.

Reddit users had already brought up this expiration issue on March 20, with Augur core developer Joey Krug noting at the time that the crypto community had exaggerated the scope of the scam, while admitting that a safeguard against such activity is currently malfunctioning and should be updated in Augur version 2. According to Binance research, the attacker also reportedly sent a limit sell order for the more realistic outcome (that the price will be between $100 and $1,000) “at a quote that is above what would be rewarded by an invalid result, but quite below that which an unsuspecting participant may consider as a good deal” in order to lure in a newcomer.

If the market is deemed invalid, then all users that contributed will see their shares valued at one-third of their initial value. The report also further notes that the market — already covered by Cointelegraph — “Which party will control the House after 2018 U.S. mid-term [sic] election?” was another instance of such an attack. This market, which reportedly exhibited a total volume of more than $2 million, featured a market settlement date was on Dec. 11, 2018, while the change in the U.S. house was effective as of Jan. 3, 2019.

In this case, users did not deem the market as invalid and settled for the Democrats’ win as the outcome. The research also suggests potential solutions to the exploitable nature of Augur’s mechanics, such as a price-based refunding mechanism, clearer references and market validators with non-trivial stakes. Per the report, prediction markets appear to be one of the best blockchain use cases, since they necessitate trustlessness and decentralization to work correctly, protecting themselves from both governmental actions and censorship.

However, according to Binance, Augur presents other substantial flaws, including low liquidity, barebones functionality, complex mechanics, an unclear approach to governance and the aforementioned ongoing attack. Prediction market regulation is particularly unclear, as a centralized prediction market can fall under the scrutiny of the regulators of multiple states. For instance, Ireland-based prediction Markets Intrade and TEN have seen the United States Commodity Futures Trading Commission (CFTC) file a civil complaint over their violation of the off-exchange options trading ban.

Article Produced By
Adrian Zmudzinski

https://cointelegraph.com/news/research-ethereum-based-prediction-market-augur-currently-faces-a-design-flaw-attack