A subsidiary of Swiss multinational investment bank Credit Suisse has completed a blockchain trial for fund transactions.

Fundsquare, the fund distribution arm of the Luxembourg Stock Exchange and the project’s technical partner, announced the news on its blog Thursday, saying Credit Suisse Asset Management and Portugal-based bank Banco Best have “successfully processed live end-to-end fund transactions” using blockchain technology.

For the trial, the firms used the FundsDLT platform, developed in a partnership with professional services firm KPMG and software provider InTech, for cross-border distribution of an investment fund. Banco Best developed an API integration and created a custom app for the effort.

The test enabled the participants to achieve “more efficient, scalable, and timely” cross-border transactions, “from delivery of the order to the processing of the trade,” Fundsquare said.

“With the successful completion of real, live transactions, we were able to prove that considerable benefits can be achieved with distributed ledger technology for both clients and asset managers,” said Credit Suisse Asset Management’s chief digital officer Pascal Nägeli.

Other asset management firms have been exploring the same use case for blockchain tech. Back in December, Calastone, operator of a London-based transaction network for investment funds, said it was looking to move its entire settlements system to a blockchain by May 2019.

In December 2017, U.S. mutual funds manager Vanguard said it will begin using smart contracts over a private blockchain for some of its business operations soon. Nasdaq and Sweden’s SEB bank also tested blockchain for mutual fund trading last September.

Credit Suisse image via Shutterstock 

Investors Cameron and Tyler Winklevoss have been ordered to pay back $45,000 in legal fees incurred by entrepreneur Charlie Shrem as part of an ongoing lawsuit that alleges he failed to broker a series of promised cryptocurrency purchases on their behalf.

In the order, filed in the U.S. District Court of the Southern District of New York on Thursday, Judge Jed S. Rakoff ruled Shrem should be reimbursed for a prior court ruling that gave the plaintiffs the ability to seize up to $30 million worth of his assets.

The initial order was rolled back on November 8, at which point Shrem filed a motion to recoup attorney’s fees and related costs to defending the motion.

Lawyers for Winklevoss Capital had attempted to argue Shrem should not recoup the funds for his costs, as he was only ultimately only charged a “de minimis amount” of less than $5. The court, however, ultimately rejected the idea this invalidated Shrem’s claim, though the judge found the requested damages should be reduced by 40 percent on reviewing the charges.

Brian Klein, partner at Baker Marquart LLP, said of the ruling:

“We are glad that the judge ruled for Charlie and ordered WCF to reimburse him for legal fees he incurred in overturning WCF’s approximately $30 million attachment order. This is another big step towards his full vindication.”

Overall, the court filing is the latest in a recent lawsuit that has pitted three high-profile cryptocurrency industry personalities and former business partners against each other in the headlines.

Winklevoss Capital was previously an investor in Shrem’s first startup BitInstant, an early cryptocurrency exchange that was one of the most public before its eventual shut down in 2013. Shrem was later found to have violated anti-money laundering rules during his tenure as CEO, for which he would ultimately serve a one-year prison sentence.

A trial is now set to hear further arguments in the ongoing lawsuit this June.

Winklevoss Brothers – Charl… by on Scribd

Charlie Shrem image via CoinDesk archives

Someone is poorly impersonating the highly anticipated bitcoin futures trading platform Bakkt in an apparent attempt to bilk people out of their bitcoin.

On Wednesday night, the CoinDesk news team received an email (subject line: “Bakkt News!”) claiming that the platform was set to launch on March 12. The email, sent from a gmail address and written in broken English, further stated that Bakkt would be seeking to raise $50 million in a second financing round and directed readers to a website, bakktplatform.io.

There, prospective investors are invited to register by entering their name and email address. After going through this process, visitors are presented with a bitcoin address to send their money and asked to provide their own address to receive their “profits” from the investment.

As of Thursday morning, no funds had been sent to the wallet.

The site (registered just a week ago through WhoisGuard, a domain owner-obscuring service in Panama, according to a WHOIS lookup) is a fake.

A spokesperson for Intercontinental Exchange (ICE), Bakkt’s parent company, told CoinDesk: “that is not a Bakkt website and we wouldn’t have communicated in that way.”

Further, the email’s claims about Bakkt are dubious at best.

No launch date

For starters, Bakkt has no official launch date right now.

The platform is still waiting on regulatory approval to begin listing its futures product, and the Commodity Futures Trading Commission (CFTC) is nowhere near such an approval.

Indeed, the CFTC has not even published Bakkt’s self-warehousing proposal for comment. Once that proposal is released, the general public will have 30 days to respond. After the comment period ends, the CFTC’s commissioners will likely take a few days to review the feedback before voting to approve or deny the proposal.

In that light, a March 12 launch date would be an aggressive target – and just to be clear, Bakkt has made no such commitment.

Caveat emptor

Even more implausible, however, is the email’s announcement of a “Second Financing Round.”

First, Bakkt just raised $182.5 million at the close of 2018, less than two months ago. And it strains credulity to imagine that a regulated institutional platform would solicit funds from the general public through a website, require just a name and email address to invest (though “company” and “industry” are optional fields on the registration form) and accept bitcoin only.

“We are at the stage of completing the testing of Blockchain on our platform, our tests have shown high results of efficiency and manufacturability using Blockchain technology in contrast to Fiat,” the bogus Bakkt website explains (sorta). “Тhe near future we plan to create the first regulated exchange of the institutional class in a developing industry and much more [sic].”

If that pitch isn’t persuasive enough, the site promises investors a return within three days of the platform’s launch (so by March 15, presumably). Perhaps appealing to FOMO, it says the platform will conclude its fundraising effort on Feb. 25, unless it hits the target before that date.

In all seriousness, please don’t send funds to this platform. Investors who do are unlikely to see their bitcoin again.

“What this Bakkt” and bitcoin address signup screenshots from bakktplatform.io

The latest code version for the lightning network – often trumpeted as the future of bitcoin payments – includes a “block size increase.”

One of the most active lightning implementations, LND, pushed out its newest “minor” release, version 0.5.2, of its beta code on Wednesday. Though it includes several changes from many contributors, mostly with the goal of making the still-experimental payment system easier for end-users, the feature that’s sure to stick out to bitcoin veterans a “block size increase,” bringing to mind the parameter that the bitcoin community went to war over a couple years back.

But don’t worry: all hell isn’t about to break loose, as the feature is not really related.

“It’s for the command line tool to be able to get a snapshot of the network. Thought I’d troll with the title lol,“ Lightning Labs developer Olaoluwa Osuntokun told CoinDesk.

Each node on the network stores a “graph” of its view of other lightning nodes on the network. That’s so that when a user sends a payment to someone else, the node can determine the best route to go through to reach its destination.

However, the graph has been ballooning as more people test out the lightning network, so developers have been brushing up against the limits. Thus, the team increased the “block size” of the graph, from 4MB to 50MB, so that developers can grab a larger snapshot.

“With this commit, we give ourselves some breathing room,” the release notes explain.

Others following developments aren’t missing the block size connection either, responding by parroting talking points often made in the debate. On the GitHub pull request for the block size change, one GitHub user wrote:

“While we’re increasing the block size, we should also re-enable some deprecated features and then call it gRPC Cash!” he said, ridiculing the cryptocurrency bitcoin cash, which split off of bitcoin in the fire of debate in the summer of 2017, charting out its own technical vision.

Even with releases such as this, the lightning network is still experimental and considered risky to use as users might lose money if the software doesn’t work as planned.

As such, the release also lays the groundwork for much-anticipated lightning changes for making it easier to use, such as Atomic Multi-Path Payments (AMP), a way to combine funds from many lightning channels into one payment, and “neutrino” light wallet support, which would allow users to use the payment system with less data.

0.5.2 is a “miner” release, meaning it mostly includes bug fixes and other small optimizations, which differs from a “major” release, where new features are released.

Electricity image via Shutterstock

The Palestinian military-political group Hamas, which the U.S. government deems a terrorist organization, may be using the Coinbase cryptocurrency exchange for fundraising.

Earlier this week, the Israeli blockchain analytics firm Whitestream identified several bitcoin wallet addresses referred to on official Hamas digital media channels in public requests for donations. One such appeal for bitcoin donations to support “the resistance” was issued on January 31, via a Telegram channel run by Abu Obeida, a spokesman for Hamas’ military wing.

As the Israeli newspaper Globes reported, those wallets included a Coinbase account.

Although Coinbase declined to comment on the address in question, Whitestream told CoinDesk that the account continued to receive transactions even 48 hours after it was identified and reported in the media.

“Based on shared inputs, we can tell that Hamas blockchain transactions were signed by addresses that are operating on Coinbase company wallets,” Itsik Levy, the firm’s founder and CEO, told CoinDesk.

Adding this account’s sum to two other bitcoin addresses Whitestream also identified as recipients of the Hamas fundraising campaign, the Islamic organization appears to have garnered less than $4,000 in bitcoin.

“[Hamas] is struggling with getting funds from the Israeli government and Qatar,” Levy continued. “We’ve heard of other Islamic extremist organizations doing the same thing over the past few years…now Hamas tries the same thing.”

“It’s still an active campaign,” he added. “It just started.”

Even if this is a case of terrorist financing solicited by the Hamas military wing, the Izz ad-Din al-Qassam Brigades, Coinbase is hardly the sole company involved with this week’s activity.

Whitestream also reportedly identified this Hamas-operated Coinbase account potentially sending bitcoin to a Binance account and a CoinPayments account, the latter of which is a wallet provider legally incorporated in the Cayman Islands. Binance and CoinPayments did not immediately reply to requests for comment on these transactions.

Several studies – including a 2018 report by the Foundation for Defense of Democracies’ Center on Sanctions and Illicit Finance – have asserted cryptocurrency usage among jihadists is still an extremely “fringe” activity.

Whitestream co-founder Itsik Levy told Globes “only 2 percent” of the bitcoin transactions his firm analyzed were connected to “terrorist or criminal activity.”

Furthermore, compared to a CoinDesk report from 2018, even the monthly volume of a single bitcoin dealer serving dozens of Gaza-based retail investors would dwarf the sum collected so far in these Hamas-affiliated accounts.

The Hamas spokesperson has not posted in the Telegram group since the last request for bitcoin donations on February 2, CoinDesk found. On that same day, this bitcoin address was tweeted by the Brigades’ global outreach account.

This may be inspired by the way the Islamic State’s Gaza wing, a fierce rival of Hamas, reportedly raised $8,000 worth of bitcoin donations by March 2018. However, there appears to be confusion among these supporters about the transparent nature of blockchain data.

On January 30, Palestinian journalist Hussam Al-Dajany said during an interview on Hamas-owned Al-Aqsa TV that: “People who donate using this currency cannot be identified by any security agency.”

Hamas image via Shutterstock

Ripple has partnered with another 10 top universities for its blockchain research program.

Announcing the news on Thursday, the blockchain payments infrastructure firm said that the University Blockchain Research Initiative (UBRI) is aimed to help grow the blockchain technology ecosystem.

Now joining the initiative are Carnegie Mellon, Cornell, Duke, Georgetown, Morgan State, Kansas, Michigan and Northeastern universities in the U.S., and the National University of Singapore and the University of Sao Paulo internationally.

Last month, Ripple also partnered with the Institute for Fintech Research (THUIFR) at Tsinghua University in Beijing under the UBRI.

Supported by Ripple’s UBRI resources, the institutions will carry out research, develop and launch course materials, host conferences and award scholarships to students pursuing work in blockchain, cryptocurrency, digital payments and related subjects.

Duke and Georgetown Universities, for instance, will support “expanding curriculum and teaching, research and technical projects and collaboration across disciplines”, while the University of Sao Paulo will receive funding for a blockchain innovation program.

With the new additions, the firm now has a total of 29 university partners, according to Ripple.

Ripple launched the initiative in June 2018, committing over $50 million to the effort and partnering with 17 universities from across the globe at the time.

“In less than a year, our initial UBRI partners hit the ground running with the launch of new research projects, events, course offerings and more,” said Ripple’s SVP of global operations, Eric van Miltenburg, in Thursday’s announcement.

“Expanding the ecosystem to a more global, diversified network of UBRI partners will only continue to enrich these projects,” he added.

Cornell University campus image via Shutterstock