Daily Byte: Tuesday, November 20, 2018

Here is some of what’s happening, for Tuesday, November 20, 2018:

DOJ Focuses Bitcoin Price-Rigging Investigation of Tether

Bloomberg is reporting that the US Justice Department is investigating whether the 2017 bitcoin price increases were partially driven by price manipulation fueled by Tether. Tether is a stablecoin tied to the price of the US dollar.

While the investigation into potential bitcoin price manipulation is months old, the DOJ just recently decided to focus on how Tether and crypto exchange Bitfinex fit into the picture. There are suspicions that Tether illegally acted to move bitcoin’s price by pumping Tether onto the market. Tether and Bitfinex share the same CEO, and Tether coins are mostly released on Bitfinex when minted.

Both Tether and Bitfinex received subpoenas last year from the US Commodity Futures Trading Commission.

The DOJ probe follows allegations made by University of Texas Professor John Griffin and Amin Shams who, in a June paper, alleged that half of bitcoin’s 2017 gains can be explained through bitcoin purchasing using Tether.

Bitcoin reached $19,650 per coin before ultimately losing 80 percent of that value.

South Carolina University to Issue Digital Diplomas via Blockchain

The Charleston, South Carolina-based Post and Courier is reporting that East Coast Polytechnic Institute – a brick-and-mortar university with campuses in North Carolina, Virginia, Florida, and Texas – is giving students the option to view and send their diplomas to prospective employers via a blockchain.

Massachusetts Institute of Technology says it was among the first to use blockchain technology to send students digital diplomas in 2017. However, the idea has been slow to catch on with other colleges.

Graduates from East Cast Polytechnic Institute can download Blockcerts, a mobile app developed in part by MIT, to view their diploma and to invite prospective employers to view it. The blockchain-protected diploma would not only take away the waiting period for receiving credentials – which can be a problem for graduates that have job offers immediately following graduation – but also the risk of faking credentials.

“They can open it, and it looks like something you can hang on your wall,” April Price, director of academic operations for ECPI, said to the Post and Courier.

The university hopes to begin offering verified digital transcripts soon.

Hackers Infect Make-A-Wish Website with Crypto Mining Malware

From the “rocket-sled straight to Hell” file, security firm Trustwave has found that hackers have infected a Make-A-Wish Foundation website with cryptocurrency-mining malware.

The infected site, worldwish.org, was compromised with the malware CoinImp. The malware injects a script into the page’s code, forcing visiting computers to mine cryptocurrency without users’ knowledge.

The malware likely came from the foundation’s use of an outdated version of Drupal’s content management system. Earlier this year, hackers targeted close to 100,000 Drupal sites in a malware campaign later known as “Drupalgeddon 2.” Updates were issued, but it appears the website owners had not executed them.

The offending script has been removed from the Make-A-Wish website.

The Make-A-Wish Foundation is an international charity committed to satisfying the final wishes of terminally ill children.

North Dakota Issues Cease and Desist Order to Bank Claiming to Offer Crypto Services

The Grand Forks Herald is reporting that North Dakota has issued a cease and desist order against a company claiming to offer security services for crypto. The order was issued Monday against Union Bank Payment Coin (UBPC), for promoting unregistered and potentially fraudulent securities in North Dakota in the form of an initial coin offering (ICO).”

“Because ICOs are sold over the internet and pitched heavily through social media platforms, North Dakotans can be exposed to the offers whether the promoter is down the street or on the other side of the globe,” state securities commissioner Karen Tyler said in a statement to the Herald. “Financial criminals continue to cash in on the hype and excitement around blockchain, crypto assets, and ICOs – investors should be exceedingly cautious when considering a related investment.”

UBPC purportedly sought to be the “world’s first security token backed by a fully licensed bank.” The North Dakota Securities Department, however, claims that the coin was exploiting an announcement made by Union Bank AG, a Liechtenstein bank. UBPC also allegedly represented itself as offering a Swiss franc-backed stablecoin.

The order came from a North Dakota-based ICO task force that is part of Operation Cryptosweep, which involves over 40 state and provincial securities regulators from the US and Canada.

Be fast, be clever, be wise. Most importantly, be here tomorrow 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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