Newsflash: Bitfinex Suspends Fiat Deposits amid Bitcoin Selloff

warning light Bitfinex bitcoinDid cryptocurrency exchange giant Bitfinex play a role in last night’s bitcoin sell-off? As first reported by The Block, the British Virgin Islands-based but Hong Kong-operated exchange has “temporarily paused” EUR, USD, JPY, and GBP wire deposits, although screenshots from customer accounts circulated on social media suggest that the situation should “normalize within a week.”

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Newsflash: Bitfinex Suspends Fiat Deposits amid Bitcoin Sell-Off

warning light Bitfinex bitcoinDid cryptocurrency exchange giant Bitfinex play a role in last night’s bitcoin sell-off? As first reported by The Block, the British Virgin Islands-based but Hong Kong-operated exchange has “temporarily paused” EUR, USD, JPY, and GBP wire deposits, although screenshots from customer accounts circulated on social media suggest that the situation should “normalize within a week.” … Continued

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Bitfinex Strongly Refutes Insolvency Claims

Bitfinex Strongly Refutes Insolvency Claims

Bitfinex has vigorously refuted claims that it and its Tether stablecoin are on the brink of insolvency. Rumors have surrounded the opaque exchange for over a year, but have intensified in the past month. “Bitfinex is not insolvent, and a constant stream of Medium articles claiming otherwise is not going to change this,” asserts a strongly worded denial.

Also read: Total of 7 Crypto Exchanges and 158 Wallets Hacked in South Korea, Police Find

Bitfinex Comes Out With All Guns Blazing

Bitfinex Starts Sharing Customer Tax Data with AuthoritiesRumors of Bitfinex and Tether’s potential insolvency have been swirling through the cryptosphere in recent days. Such has been their virality that the normally uncommunicative exchange has taken the step of breaking its silence. In a blog post published today, Bitfinex emphatically refuted all such unfounded claims and took aim at critics who “are quick to scream insolvency, seemingly with little understanding of what this concept means and what they are generally talking about”.

As proof of this, Bitfinex posted the address of its BTC, ETH, and EOS cold wallets. They contain almost $1 billion of bitcoin core, $400 million of ether and $200 million of EOS. Since the bulk of these assets are presumably customer deposits, they do not in fact prove that Bitfinex is solvent. Besides, even the platform’s staunchest critics have not denied that Bitfinex has significant crypto assets under its control. Rather, they have raised concerns over its fiat banking arrangements, and specifically the enduring question of whether the $2.8 billion of tethers in circulation are backed by dollar deposits.

Bitfinex Strongly Refutes Insolvency Claims

“A Targeted Campaign Based on Nothing but Fiction”

Bitfinex hasn’t minced its words in seeking to rebut the many rumors regarding its business, excoriating a “a targeted campaign based on nothing but fiction”, and insisting that customer fiat deposits are working as normal. It’s also insisted that anything that might be going on with Puerto Rico-based Noble Bank, itself the subject of insolvency rumors, is none of its concern. It’s been revealed that Bitfinex is now banking with HSBC, via an intermediary, though it is unclear whether HSBC is aware of this due to funds being funneled through the private account of Global Trading Solutions.

Bitfinex, currently the world’s 12th largest crypto exchange by trading volume, has conceded that it has been suffering from banking issues, acknowledging:

Complications continue to exist for us in the domain of fiat transactions…However, we continue to do our utmost to minimise any waiting times associated with fiat deposits and withdrawals.

Bitfinex Strongly Refutes Insolvency Claims
The Bitfinex BTC cold wallet

Certain figures on crypto Twitter have been encouraging traders to get their funds off Bitfinex before the platform collapses or is shut down by authorities. Both predictions, at this time, are likely to be wide of the mark. Running a top 20 cryptocurrency exchange, especially one that has been established for as long as Bitfinex, ought to be a very profitable enterprise. Questions still remain over Tether, however; to date, no journalist has managed to unearth evidence of a customer depositing or withdrawing fiat currency in return for USDT. Until such a time, the rumor mill will continue to thrive.

Do you believe Bitfinex is solvent? Let us know in the comments section below.


Images courtesy of Shutterstock, and Bitfinex.


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Major Crypto Exchange Bitfinex Obtains Banking Partner in HSBC, Will it Last?

On Oct. 6, Larry Cermak, former editor at Diar and head analyst at The Block, reported that leading crypto exchange Bitfinex obtained a banking partner in HSBC, a $133 billion banking giant based in London. “Bitfinex is now banking with HSBC through a private account of Global Trading Solutions. Very good fit if you ask … Continued

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European Banks Complicit as Corrupt African Leaders Plunder Their Home Economies

European Banks Complicit as Corrupt African Leaders Plunder Their Home Economies

European banks have allegedly been complicit as corrupt African leaders pilfer the wealth of their economies in the billions of dollars. The Angolan government on Monday arrested the son of ex-president Jose dos Santos for stealing $500 million from the country’s sovereign wealth fund, with the help of a British bank. It is only a few days ago that Nigeria demanded that a bank in Europe returns $100 million laundered by former dictator Sani Abacha. In Liberia, ex-central bank governor Milton Weeks is under investigation for the $104 million that vanished from state coffers.

Also read: Pushing The Boundaries Of Economic Change: Bitcoin As A Medium Of Exchange In Africa

Angola Police Arrest Ex-President’s Son Over Allegations of $500 Million Plunder

Police in Angola on Monday arrested the son of former president Jose Eduardo dos Santos, over a corruption case involving the alleged illegal transfer of $500 million of public funds to a British bank, according to a report by Bloomberg.

Jose Filomeno dos Santos was placed in “preventive detention”, Angolan authorities say.

European Banks Complicit as Corrupt African Leaders Plunder Their Home Economies
Jose Filomeno dos Santos

He had initially tried to wire the funds to the London branch of Swiss bank Credit Suisse using “forged documents”, but British authorities blocked the transfer “suspecting foul play,” say earlier reports.

The transfer later sailed through, this time allegedly via an HSBC Holdings plc account in the United Kingdom, Bloomberg reported, quoting the Angolan prosecutor general Alvaro Da Silva Joao.

“The evidence gathered resulted in sufficient indications that the defendants have been involved in practices of various crimes including criminal associations, receipt of undue advantage, corruption, participation in unlawful business, money laundering, embezzlement, fraud among others,” he said.

Angola’s Finance Ministry says dos Santos, who was head of the country’s $5 billion wealth fund, disguised the transfer as a project aimed at attracting investment in Angola with the help of a fake guarantee from a bank in Europe.

European Banks Complicit as Corrupt African Leaders Plunder Their Home Economies

Appointed by his father to head the wealth fund in 2013, dos Santos was sacked earlier this year after he was charged with misappropriating public funds to the tune of $500 million from the National Bank of Angola. He promised to comply with investigations at the time.

His arrest, together with Angolan-Swiss businessman Jean-Claude Bastos de Morais, is part of President Joao Lourenco’s plans to rid Africa’s number two oil producer of corruption. Angola is ranked by the Transparency International among the world top 20 most corrupt countries.

Former Transport Minister Augusto da Silva Tomas has also been arrested over allegations of embezzlement, local media reported.

Banks Face Criticism Over Growing Trend

The latest development comes at a time when European banks have faced criticism for allegedly aiding corrupt African leaders siphon billions of dollars from the impoverished continent. According to the African Capacity Building Foundation, the continent loses up to $50 billion in illicit financial flows each year.

Nigerian President Muhammad Buhari last week demanded that HSBC Bank return up to $100 million it allegedly helped former dictator Sani Abacha launder from the Nigerian economy.

European Banks Complicit as Corrupt African Leaders Plunder Their Home Economies

In 2006, Switzerland handed back $500 million of the Abacha loot to Nigeria – the first time any bank in Europe had returned stolen money to a country in Africa.

Liberia has indicated that it is investigating its former central bank governor Milton Weeks and Charles Sirleaf, son of the former president Ellen Johnson Sirleaf, over $104 million that vanished from state coffers.

HSBC Holdings plc is one of the largest banking and financial services organisations in the world. HSBC’s international network comprises around 7,500 offices in over 80 countries and territories in Europe, the Asia-Pacific region, the Americas, the Middle East, and Africa.

But the firm has been forced to pay billions of dollars in fines for money laundering and other financial crimes. In the US, HSBC paid $1.92 billion for helping to facilitate the laundering of Mexican drug money, and several million were paid in Hong Kong for systemic deficiencies.

Cryptocurrency to Stem The Flow of Illicit Transfers

Cyptocurrency is seen as key to helping African countries fight corruption and illicit transfers.

A report by Enrique and Eduardo Aldaz-Carrol published on the Brookings Institution website revealed that: “cryptocurrency and blockchain could help prevent fraud and corruption, reduce the costs of enforcement thanks to easily accessible information and faster crosschecks, and help supervise implementation and monitor efficiency and effectiveness of spending, increasing development impact”.

Do you think that banks in Europe are contributing to the collapse of African economies? Let us know how you feel in the comments section below.


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Nigerian President Demands HSBC Bank Return $100M in Stolen Money

Nigerian President Demands HSBC Bank Return $100M in Stolen Money

Decentralised cryptocurrencies like bitcoin are anathema to traditional banking. Bitcoin allows people to trade directly with each other, bypassing banks, the conventional middlemen. Banks make money by charging fees for the services they provide, including keeping one’s money in a bank. It is no surprise, therefore, that they hate cryptocurrency. But banks aren’t guiltless, they have facilitated some of the most egregious financial crimes of our time.

Also read: Poor Internet Access Could Slow Down Cryptocurrency Growth In Africa

‘Return Our Stolen Assets’

President Muhammad Buhari has demanded HSBC Bank returns up to $100 million it allegedly helped former dictator Sani Abacha launder from the Nigerian economy.

Nigerian President Demands HSBC Bank Return $100M in Stolen Money
HSBC bank

Abacha ruled Nigeria with an iron fist for five years until he died of a heart attack in 1998. During his rule, the Nigerian economy improved somewhat, with inflation plummeting to 8,5 percent in 1998 from about 55 percent five years earlier. Forex reserves shot more than 1,800 percent to $9,6 billion.

But the former army general is accused of plundering the West African country at a grand scale, looting more than $4,3 billion of Nigeria’s oil wealth while still President. Transparency International has listed Abacha as the world’s fourth most corrupt leader in history.

“Our investigation agencies believe that HSBC had laundered more than US$100 million for the late General Sani Abacha in Jersey, Paris, London, and Geneva,” Nigeria’s presidential spokesperson Malam Garba Shehu, said in a statement issued to the local Leadership newspaper on September 16.

“Among these accounts on the records are: AC : S-104460 HSBC Fund Admin Ltd. Jersey ($12 million); AC 37060762 HSBC Life (Europe), UK ($20 million) and AC : 38175076 HSBC Bank Plc, UK ($1.6 million),” Shehu said.

Shehu was reacting to a report by HSBC Bank in July, which predicted the Nigerian economy would decline if President Buhari won a second term in office in general elections slated for next year.

He continued: “The Presidency wishes to make clear to all Nigerians, and particularly the global banking giant HSBC…that what killed Nigeria’s economy in the past was the unbridled looting of state resources by leaders, the type which was actively supported by HSBC.

Nigerian President Demands HSBC Bank Return $100M in Stolen Money
President Buhari

“A bank that soiled its hand with ‘millions of US dollars yet- to- be – recovered Abacha loot’, and continued until a few months ago to shield the stolen funds of one of the leaders of the Nigerian Senate has no moral right whatsoever to project that a second term for Mr Buhari raises the risk of limited economic progress and further fiscal deterioration.”

Shehu said, “we ask them (HSBC)…to return our stolen assets…”

Serial Offender

The Nigerian anti-corruption body, the Economic and Financial Crimes Commission, on Sunday also accused the British bank of being “involved with laundering proceeds of corruption for over 50 Nigerians including a Nigerian serving Senator.”

HSBC Holdings plc is one of the largest banking and financial services organisations in the world. HSBC’s international network comprises around 7,500 offices in over 80 countries and territories in Europe, the Asia-Pacific region, the Americas, the Middle East, and Africa.

But the firm has been forced to pay billions of dollars in fines for money laundering and other financial crimes. In the US, HSBC paid $1.92 billion for helping to facilitate the laundering of Mexican drug money, and several million were paid in Hong Kong for systemic deficiencies.

Of the Abacha loot, the US has repatriated about $480 million that was stashed in banks in that country. In 2006, Switzerland handed back $500 million to Nigeria – the first time any bank in Europe had returned stolen money to a country in Africa. The continent loses up to $50 billion in illicit financial flows each year, according to the African Capacity Building Foundation.

Do you think cryptocurrencies can help stem the flow of corrupt money in Africa? Let us know what you think in the comments section below.


Images via Shutterstock.


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HSBC Whistleblower Who Exposed Money Launderers, Tax Evaders Turns Crypto Promoter

A whistleblower who leaked data exposed tax-evading and money-laundering clients at the multinational financial institution he worked in has just given the finger to the banks once again by lending his efforts to increasing cryptocurrency awareness. Herve Falciani, the former computer systems analyst at banking giant HSBC, is now promoting a cryptocurrency known as Taboow, … Continued

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Banks Freeze Company’s Accounts After Owner Traded on Localbitcoins

Banks Freeze Business' Accounts After Owner Traded on Localbitcoins

The owner of cryptocurrency mining electric bicycle retailer, 50cycles, recently had his company’s accounts with HSBC and Barclays frozen within hours of transacting on peer-to-peer cryptocurrency trading platform, Locabitcoins.

Also Read: P2P Exchange Options Increasing for Crypto Traders in India

HSBC and Barclays Freeze Accounts of 50cycles

Scott Snaith, the owner of cryptocurrency mining electric bicycle retailer, 50cycles, has sought to deter businesses from partnering with U.K. high street banks after his company was thrown into “chaos” following the freezing of his business’s accounts.

Mr. Snaith’s accounts were frozen by HSBC and Barclays just hours after he conducted five-figure BTC transactions via peer-to-peer trading platform Localbitcoins, in which he sold BTC for fiat currency that was deposited into his personal bank accounts, and not his company’s accounts. Mr. Snaith asserts that the transactions were “entirely transparent and above board,” adding that his trading partners were U.K. account holders with verified identification. Mr. Snaith stated that no explanation was offered for the account closures, describing himself as being the victim of “financial discrimination.”

“My two personal bank accounts and business account were frozen for using a well-known bitcoin trading site. No unlawful activity has taken place but just because the word ‘Bitcoin’ was mentioned my accounts were locked instantly. A ‘senior fraud advisor’ then closed my complaint off – leaving me with no choice but to take the issue to the Financial Ombudsman for appeal. This situation is a complete nightmare and the knock-on effects have been unbelievable. One of my staff left as they had just had a baby and couldn’t afford to be in a job that was unable to pay them, which isn’t surprising,” Mr. Snaith said.

HSBC Reinstates Account, Barclays Refuses

Banks Freeze Business' Accounts After Owner Traded on LocalbitcoinsWhilst HSBC have reinstated Mr. Snaith’s account, Barclays maintained the freeze. Mr. Snaith stated: “I’ll never be able to bank with Barclays again. I’m a professional business owner taking advantage of new financial technologies and it looks like the banks are failing to keep up with their customers’ habits. We are the ones being punished. The banks are deliberately creating obstacles. They are anti-digital currency and displaying a new form of financial discrimination.”

“To me, this is a clear case of the high street banks abusing their power. It is not a criminal matter but a personal, corporate decision that someone has made. In my mind, that’s wholly wrong, and I am sure there are many other victims that are even less fortunate than myself,” he added.

What is your reaction to the freezing of 50cycles’ accounts? Share your thoughts in the comments section below!


Images courtesy of Shutterstock


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Hong Kong Trade Finance Will Fight Fraud With a Blockchain-Based Platform

The Hong Kong Monetary Authority (HKMA) has partnered with Chinese Ping An to release a blockchain-based trade finance platform. The joint effort is expected to speed-up the process and prevent fraud. CCN first reported the Hong Kong’s de facto central bank’s initiative back on March 30. At the time, the bank unveiled a proof-of-concept (PoC)

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HSBC Completes World’s First Blockchain Trade Finance Transaction

Financial services group HSBC said on Monday it had for the first time utilised blockchain technology to complete a speedy commercial trade finance transaction that normally takes around a week using normal paper-based processing mediums. The transaction was the first time that a blockchain – the technology which powers cryptocurrencies such as bitcoin – has

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HSBC Completes First Trade Using Blockchain Technology

HSBC

HSBC Holding PLC (NYSE:HSBC) told the press on Monday that is completed the world’s first trade finance transaction using blockchain technology. The incentive? HSBC sees blockchain as a solution to help boost efficiency in the multi-trillion-dollar funding of international trade.

Last Year, HSBC was awarded ‘World’s Best Bank’ and ‘North America’s Best Bank for Transaction Services’ among a list of many others, at the 2017 Euromoney Awards.

The bank issues a letter of credit for the U.S. food and agriculture firm Cargill. This letter of credit was issued from HSBC to the Dutch bank ...

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Big Banks are Investing Heavily in Blockchain and Crypto: $364 Billion Investment Firm

Steve Chiavarone, a portfolio manager at Federated Investors, a US-based investment firm that oversees $364 billion in customer assets, stated that blockchain technology will drive the fourth industrial revolution, echoing the stance of many large-scale investors and politicians, including Seoul mayor Park Won-soon. “When you think about it from an enterprise perspective, it has the

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HSBC Pushing Blockchain, JP Morgan Threatened by Crypto

HSBC

HSBC (NYSE:HSBC) is gearing up to use blockchain technology in live transactions. On the other end of the spectrum, JP Morgan (NYSE:JPM) joins the financial institutions labeling cryptocurrencies as a risk to their business. Two major banking institutions with two different reactions to cryptocurrency.

HSBC

HSBC may be close to launching several different pilot programs that will help the banking giant incorporate live blockchain transactions into the business.

The pilot programs will be based on pre-existing proof-of-concept (PoC) projects. HSBC has been conducting trials with blockchain technology for several years now. In August 2016, ...

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