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The venerable New York Office of the Attorney General has found several cryptocurrency exchanges to be vulnerable to market manipulation, in “potential violation of New York's virtual currency regulations,” as well as, apparently, rather un-fussed about it all. Indeed, exchanges Binance, Gate.io, and Kraken's refused to participate at all in the investigation, much to the Office's alarm.
But it's not difficult to see why they refused—Coinbase, which did participate, was forced to disclose that "almost 20 percent of executed volume on its platform was attributable to its own trading," which is like admitting your world-famous salad niçoise is 20 percent rat droppings.
Meanwhile, the UK Treasury Committee has called for stricter regulatory oversight over cryptocurrencies as a “as a matter of urgency," citing concerns over initial coin offerings whose often abortive promises of future riches have “exposed a regulatory loophole that is being exploited to the detriment of ordinary investors."
Cryptoassets, the Committee added, “have no inherent value” and are “particularly vulnerable to manipulation.” It's a stark reminder for the crypto-anarchists among us—dodge the jabs of the long arm of the law and it'll just bend back round and put you in a headlock.
Hester Peirce, commissioner of the Securities and Exchange Commission, has a more cautiously optimistic take. Though Peirce acknowledges that cryptocurrencies are largely the preserve of a “particular type of investor” (whom she kindly does “not attempt to characterize”) and are prone to hacks, she says that crypto-assets may prove a valuable way to diversify investors’ portfolios, which are otherwise growing homogenous, and dull.
Yet as usual, it’s the bots taking matters into their own hands. Security researchers have added a new genus of “botnet” to the robo-taxonomy. This particular “botnet”—an online software that runs the scripts of semi-intelligent “bots”—crashes crypto-jacking malware on infected devices and then, like an honorable 14th-century Japanese general, self-destructs.
Whether the bot was designed by a benevolent programmer or a “rival crypto-jacker seeking to remove the competition” is anyone’s guess, says Coindesk. So potentially, there's a Bloodz & Crips-scale bot turf war brewing. This could get heavy (or not).
The onslaught of hand-wringing regulatory proclamations, olive branch-wagging rapprochements, and bot-vigilantism made little dent on the markets, which have made some comfortable, though largely unremarkable, gains.
By far the most prodigious, however, was Ripple, which soared by 23 percent overnight, hitting $12.8 billion in market capitalization (from $10.9 billion), likely as investor interest grows ahead of its planned xRapid release, which is expected to vastly speed up cross-border transactions. Ripple did settle a little afterwards, but its upsurge is telling: there’s a massive appetite for bank-friendly, regulated cryptocurrencies. Hell, even the bots know it.