Atlanta declines ransom request, Congress takes on crypto … again, Mastercard exploring transaction anonymity, and Facebook toothless against ad scams.
Lawmakers Seek Beginnings of US Crypto Regulatory Framework
Less than a week after US Representative Warren Davidson said he would propose legislation to define crypto assets, a group of bipartisan House members plans to introduce two bills that could constitute the first step in making a national regulatory framework for cryptocurrency.
The bills would ask the Commodities Futures Trading Commission to submit suggestions on how the federal government can prevent fraud, protect consumers, and ensure American prominence in the crypto-asset marketplace through regulatory changes, CNBC reports.
The federal government has been playing catch-up on regulating ICOs and crypto securities options, relying largely on SEC and CFTC rulings in the absence of legislation.
Mastercard Files Patent for Anonymizing Blockchain Transactions
Mastercard has filed for a patent to anonymize blockchain transactions, which would make it easier for banks and large financial institutions to ensure customers’ private data remains safe.
The method, designed to anonymize the entire transaction and not just the originator of the transaction, would, in effect, show the transaction’s handler, such as Mastercard, and the amount of the transaction, without displaying any information about who requested the transaction or the transaction’s destination.
Mastercard notes that cryptocurrencies such as bitcoin, despite suggesting privacy, have transactions that can “be traced and followed back to the genesis block.” The application reads:
“The existing communications and attribution structure of blockchain technology such as Bitcoin require identification of where the transactions are emanating and terminating, in order to maintain the ledger. This creates a technical problem of competing interests within the technology.”
Mastercard’s proposed anonymity method will have competition. Zcash’s zk-SNARKS and Monero’s stealth addresses both provide ways for users to stay anonymous in transaction records.
Atlanta Ignored Crypto Ransom Demands
Atlanta and other cities, state agencies, and hospitals throughout North America were subjected to the SamSam cyber-attacks. In Atlanta, the attack infected about 3,789 city computers, disrupting city services. Iranians Faramarz Shahi Savandi and Mohammed Mehdi Shah Mansouri were indicted last week for their involvement in the attacks – and two Iranians who allegedly helped exchange the crypto for Iranian rial were placed on a Treasury Department watchlist.
The hackers demanded that Atlanta pay six bitcoin to unlock the infected computers. It is unclear if the city opted not to pay the ransom or was unable to do so, as the website where the city was referred to pay the ransom became inaccessible. It cost the city millions of dollars to undo the damage of the attack.
Facebook Impotent to Stop Scam Ads
Despite a June policy update only allowing pre-approved advertisers to promote crypto services and products on Facebook, crypto scam ads still proliferate on the social media platform, reports Forbes.
British financial advisor Martin Lewis told Forbes:
“This is a constant flood, though the number of ads involving my face appear to have dropped. Once the ones featuring me began to disappear, others started to appear. They’re about a scam feeling warm and cuddly with a well-known and trust face. It adds credibility to the scams being on these kinds of social media platforms. People would expect them to be doing their due diligence when it comes to the ads they feature, but evidently they are not.”
Facebook has had a difficult year. It is still facing scrutiny for not doing enough to prevent the spread of misinformation during the 2016 presidential election as well as for its failure to protect users’ private data.
Be fast, be clever, be wise. Most importantly, be here Monday for your Daily Byte.
Frederick Reese is a politics and cryptocurrency reporter based in New York. He is also a former teacher, an early adopter of bitcoin and Litecoin, and an enthusiast of all things geeky and nerdy.
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