Cryptocurrency thefts globally are expected to reach over $1 billion this year, about four times the recorded thefts in 2017, according to a report from CipherTrace, a firm that specializes in ensuring legal compliance for blockchain transactions.

From the first three quarters of 2018, already $927 million worth of cryptocurrencies has been documented as stolen, according to the company.

Included in the listed amounts were high-profile hacks of cryptocurrency exchanges such as $530 million worth of tokens stolen from Japanese exchange Coincheck, and $195 million taken from Italian exchange BitGrail.

"Additionally, CipherTrace is aware of over $60 million in cryptocurrency that was stolen but not reported publicly," the report read.

The company also pointed out that the figure for the first three quarters of 2018 was already 3.5 times larger than all of the previous year, where $266 million was reported stolen globally.

CipherTrace, which deals with blockchain forensics and enforcement solutions, stressed that stricter regulations in the cryptocurrency trade were in demand all over the world. "Establishing their countries' reputations as 'safe' digital markets helps to attract trustworthy cryptocurrency exchanges and digital asset businesses," according to the company.

It cited the European Commission's fifth Anti-Money Laundering Directive last July, and policies and monitoring of the Financial Action Task Force, as part of current regulatory initiatives.

The report also noted how existing anti-money laundering (AML) and know your customer (KYC) regulations for the cryptocurrency trade have been moving the use of cryptocurrencies for criminal activity to less regulated markets. The result is that 97% of BTC payments for criminal activity ended up in unregulated exchanges or in exchanges of countries with weak AML legislation.

According to CipherTrace, 4.7% of total BTC received in countries with weak regulations comes from criminal activity, which it defined as directly coming from sources such as dark market sites, extortion, malware, money laundering sites, ransomware, and terrorist financing.

The data analyzed came from 45 million transactions in the top 20 cryptocurrency exchanges, up to last September 29. Using U.S. Department of State Bureau for International Narcotics and Law Enforcement Affairs data, CipherTrace determined that 79 of 212 "have weak AML regimes" due to lack of government controls to regulate drug dealing and money laundering, to enforce KYC regulations, report large and suspicious transactions, and maintain records over time.

The data showed that 95% of BTC paid from exchanges to criminals, worth $1.5 billion at present prices, was sent from unregulated exchanges.

CipherTrace added that "the unregulated exchange is growing at 300%, with risky transactions and criminal transactions growing fastest."

New Research Claims Most ICOs Have Profited Off Selling ETH

Bitmex Research is back with another detailed report, this time into the ethereum holdings of ICOs. Ethereum's downward trajectory has been attributed in some quarters to ICOs offloading ETH to pay the bills. If so, data suggests that those projects have profited handsomely off their ETH holdings in USD terms, despite its falling price.

Ethereum's tanking price, sliding from over $1,400 to below $200 in seven months, has alarmed many cryptocurrency investors. ETH is the backbone of the ICO economy, and its inability to sustain support levels against BTC has led to fears of there being a run on ethereum, akin to that which occurs when customers fear a bank lacks the funds to cover its liabilities. If Ethereum projects believe the cryptocurrency is likely to drop further, they will feel pressured to sell in order to maximize their capital, further accelerating the token's decline.

Commenters have been in disagreement over the extent to which ICOs cashing out has triggered ETH's downfall. Dapp Capitulation has been the go-to tool for anyone trying to keep track of which ICOs are moving ETH (presumably with the intention of selling) and when. In the last 30 days, for example, Status has sent 8,000 ETH to an exchange wallet and Decent has moved 20,000. New research from Bitmex and Tokenanalyst, however, provides a more holistic picture of ICO movements of ethereum. Its key finding?

Rather than suffering because of the recent fall in the value of ethereum, at the macro level, the projects appear to have already sold almost as much ethereum as they raised (in US$ terms).

The Coffers of Last Year's ICOs Are Not Yet Empty

In determining the profit or loss realized by Ethereum-based tokensales, Bitmex Research has created two columns: one for EOS and the other for everything else. Since EOS raised about as much as the rest of the market put together during its year-long fundraiser, it was necessary to record it separately to avoid skewing the data. A macro analysis of 222 ICOs found a total of 15.1 million ETH was raised, of which 11.3 million has been transferred out or sold. This leaves a remaining collective balance of 3.85 million ETH. Since EOS has offloaded all its ETH, this sum is shared among the other 221 projects.

The most useful data provided by Bitmex Research and Tokenanalyst is a calculation of whether ICOs that have sold a lot of ether can be expected to have made a profit or a loss. Broadly speaking, the older the ICO, the likelier it is to have profited from its ETH holdings. Projects that raised funds in late 2017 or this year, on the other hand, are almost certain to have seen the value of their crypto assets dwindle. Overall, the report finds non-EOS projects to have recorded net realized gains of $727 million through selling ETH, and to be sitting on another $93 million in unrealized gains i.e. ETH they've yet to sell.

Some Big Winners and a Few Losers

Not all projects have prospered: it's estimated that $34 million in ETH has been lost by projects being forced to liquidate their holdings at below the value they held during their crowdsale. The report concludes: "Despite the 85% reduction in the ethereum price from its peak, the projects have realised gains of US$727 million due to profits from ethereum they have already sold, often selling before the recent price crash. The 3.8m ethereum still on the balance sheets of these projects may not have that much of an impact on the ethereum price, as it represents a reasonably small proportion of the 102 million supply of ethereum. At the same time, on a macro level, the projects may be feeling reasonably confident rather than needing to panic sell."

In what appears to be a new turn of events for the controversy surrounding EOS blockchain developer Block.one, the firm now finds itself fighting back against allegations that influential Chinese groups are colluding to control its blockchain.

An anonymous source last week supposedly leaked an internal document claiming that "collusion, mutual voting, and pay-offs" is a common practice among block producers in the EOS network, TheNexWeb (TNW) reported. Chinese cryptocurrency exchange Huobi was further mentioned as one of the main actors behind the voting corruption.

According to the report, Huobi and other major block producers allegedly vote for each other in an effort to retain their status within the network, as well as securing their income streams. Further, Huobi reportedly receives EOS tokens in exchange for voting on others.

Huobi denies any "financial business" with the other nodes on the network, a tweet from Chinese crypto news source cnLedger said, referencing a statement from the company (in Chinese).

Block.one CEO Brendan Blumer said in a public statement on Monday that "we are aware of some unverified claims regarding irregular block producer voting, and the subsequent denials of those claims." Blumer further added that he remains "very optimistic about the future of the EOS public blockchain […]"

The model used by EOS is a consensus model known as "Delegated Proof-of-Stake," which means that those who are heavily invested in the project also gets more voting power in deciding who gets to mine EOS. Huobi's EOS mining pool is currently the third most powerful block producer, and is rewarded with EOS tokens worth approximately USD 4,700 per day, according to TNW.

"In general, what EOS already brought is this massive social experiment to the world. You can think of it as a global borderless democracy thing happening across the world with voting politics (possibly even vote buying), with global consensus, with disputes and issues, with many solutions to one problem <...>," Vytautas Kašėta of EOS Lithuania, a block producer candidate, told Cryptonews.com earlier this year.

EOS has seen its price drop sharply since its peak in late April this year. At its all-time high, EOS traded at more than USD 20 per token, but is now down to a level of around USD 5.7, a decline of about 75%.

The Malaysian government is seeking to utilize blockchain to increase transparency, sustainability and logistical efficiency of its three largest industries—renewable energy, palm oil, and Islamic finance.

According to reports, the government has appointed a task force named the Malaysian Industry-Government Group for High Technology (MIGHT) to oversee the blockchain adoption. Mastura Ishak, program director at MIGHT, told GovInsider: "Blockchain is interesting because it allows small players to have a say about what's going on."

The Malaysian government believes that adopting blockchain in the renewable energy industry will help bring new players to the table and increase energy production in the country. Currently, Tenaga Nasional Berhad (TNB) is the only utility provider in the country.

The new project will allow private solar panel owners to sell any excess electricity they have. In the new system, electricity sellers will be required to state how they are generating their electricity, while consumers will have the choice of deciding which sources of electricity they would like to use.

By allowing private solar panel owners to sell their surplus electricity, the country will also save up on the electricity lost during long-distance distribution.

For the palm oil industry, the Malaysian government hopes blockchain will help bring major changes that will improve the country's economy. Palm oil is Malaysia's biggest export, accounting for about 43.1% of the country's agricultural income.

Palm oil has been facing problems for quite some time now. This happened after reports emerged associating the industry with bad practices and child labor. MIGHT believes blockchain adoption can help identify certified palm oil operations which will help eliminate illegal operations. The government will also be able to monitor and regulate the operations.

Finally, there's Islamic finance. Islamic laws state that money has to be based on real commodity and cannot be created from more money. The strict nature of Islamic laws have caused high overhead costs on the industry, which is reflected in the country's economy. The government is looking at how they can offset these costs while also adhering to Sharia laws. Blockchain and the adoption of smart contracts could help offset some of these costs.

UNICEF France is now taking donations in cryptocurrencies. On its website, the humanitarian body said it accepts donations in nine cryptocurrencies, including Bitcoin BCH, as well as BTC, ETH, EOS, Stellar, LTC, XRP, DASH and XMR. The decision to finally accept cryptocurrencies was partly due to the organization's need to expand its circle of donors and sources of funding, according to UNICEF France.

The organization is also calling on its well-wishers to donate their computing power for the purpose of mining six crypto coins to directly to UNICEF France's wallets. This concept of accepting crypto donations was born after the GameChaingers campaign in February. The campaign, launched by UNICEF to help children in the war torn country of Syria, asked gamers to contribute their mining power to mine cryptocurrency as part of the initiative. Interested gamers and donors had to install the Claymore mining software to mine ETH, the chosen crypto for the project. The campaign ended last March 31, with UNICEF mining 85 ETH.

Sébastien Lyon, the director of UNICEF France pointed out that while cryptocurrencies is an innovation in the fundraising sphere, it is being utilised by few organizations in the field. He noted, "Cryptocurrency and blockchain technology used for charitable purposes offer a new opportunity to appeal to the generosity of the public and continue to develop our operations with children in the countries of intervention."

UNICEF France had taken a cue from UNICEF Australia, which, in April, created an initiative where crypto mining was conducted by visiting a website, HopePage, which had been set up for the specific purpose of mining Monero. Also in May, UNICEF announced that donors could use Coinhive to offer their donations to support refugees through mining cryptocurrency. The funds raised was used to help 400,000 children in Rohingya who were affected by the violence in Myanmar.

Jennifer Tierney, director of UNICEF Australia, explained, "The HopePage allows Australians to provide help and hope to vulnerable children by simply opening the page while they are online." HopePage asks users for confirmation before using anybody's system to mine for UNICEF Australia, and users can adjust how much computing power they are willing to donate or leave the browser tab open to keep contributing to the initiative.

Denmark's largest bank, Danske Bank, reportedly knew that some of its Estonian branch's clients were on the Russian government's blacklist but did not close their accounts for two years. The bank is currently being probed by three countries over $150 billion money laundering allegations.

Danske Bank is currently under investigation by authorities in three countries: the US, Denmark, and Estonia. Its officials reportedly "knew earlier than previously indicated about problems at its tiny Estonia branch, including that it held accounts for blacklisted Russian clients," The Wall Street Journal reported Tuesday, citing correspondence it has seen. The publication elaborated:

Officials at Danske Bank were aware almost two years before it started shutting questionable accounts that the small but highly profitable branch was involved in potentially illicit money flows.

The Estonian branch was one of the bank's profit drivers, generating a net profit of €63 million (~US$73.5 million) in 2012, the most lucrative year. The whole bank reported €636.6 million (~$742.6 million) in net profit that year, the publication noted.

The largest bank in Denmark has been at the center of one of Europe's largest money laundering cases. Between 2007 and 2015, an estimated $150 billion was suspected to have flowed through the branch to accounts belonging to non-Estonian customers including Russian clients. However, the bank has not confirmed how much of that figure comes from suspicious transactions. It has launched an internal investigation and is expected to announce the results on Wednesday, Sept. 19.

Discriminating Email

According to the Wall Street Journal, an April 2013 email reveals that the bank's anti-money laundering (AML) chief based in Denmark had asked colleagues in the Estonian branch "about client accounts whose owners appeared on a blacklist generated by Russia's central bank." The Bank of Russia keeps a database of individuals and companies suspected of financial wrongdoing which it shares across borders. The list currently has about 500,000 names.

The Estonian Financial Supervision Authority (FSA) said on Tuesday that "it repeatedly complained to Danish counterparts about the branch's blacklisted customers," the news outlet conveyed, adding that in a 2013 email, Niels Thos Mikkelsen, the bank's then-compliance executive, wrote:

"They have the impression that we do not take the issue seriously."

Furthermore, the news outlet added that a spokesman for the Danish FSA pointed out that a reprimand ruling against Danske Bank in May states that the authority received "misleading" information from the bank between 2012 and 2014. Danske claims the information came from the branch.

While the Financial Times recently reported that Thomas Borgen, the bank's CEO, was notified in October 2013 about suspicious transactions at the Estonian branch, Borgen insists that "he was not informed in detail at the time about the problems," Reuters described on Tuesday, elaborating:

"The Danske Bank case has led to speculation in Denmark that its chief executive Thomas Borgen, who was in charge of its international operations, including Estonia, between 2009 and 2012, will step down."

Over the past few weeks, Bitcoin Cash supporters have been debating the upcoming hard fork scheduled for November 15th of this year. Most of the community understands, that as of right now, there are two camps that have entirely different visions. It doesn't seem like a compromise is coming any time soon. Lately, as each day passes and as time draws closer to the upgrade, both disagreeing parties have been testing certain features and publishing various papers concerning the theoretical effects of specific upgrade additions.

The November 15th Upgrade Debate Continues

Right now is probably a pretty confusing time for a few people just learning about the disagreement taking place concerning the scheduled November 15, 2018, Bitcoin Cash network upgrade. Currently, there are two camps that disagree on which features will be added to the hard fork this November — The Bitcoin ABC development team and the clients' supporters, and the Nchain development team and the Bitcoin SV clients' crew of proponents.

The Bitcoin ABC development team wants to add an opcode called OP_CHECKDATASIGVERIFY (DSV) that aims to improve BCH scripting, canonical transaction ordering (CTOR), and some minor technical fixes and improvements.

The Nchain team and it's BCH full node client called Bitcoin SV wants an entirely different set of features. Bitcoin SV's upgrade list includes a 128MB block size increase, add the opcodes:  OP_MUL, OP_LSHIFT, OP_RSHIFT, OP_INVERT, and remove the limit of 201 opcodes per script.

At first, the most vocal person against the Bitcoin ABC proposals was Nchain's chief scientist Craig Wright. However, there are many others who support the idea of Bitcoin SV and the blockchain, and mining firm Coingeek had decided to support Nchain's idea from the beginning. Since then Nchain has released its alpha version codebase, started a Bitcoin SV mining pool so people can direct hashrate to the client, and both the mining pools Coingeek and BMG Pool (Nchain's hashrate) have managed to capture 46.2 percent of the global BCH hashrate over the last seven days.

Bitcoin Cash Proponents Argue the Pros and Cons of Canonical Transaction Ordering

There have been so many arguments for and against some of the features the two camps are promoting. For instance, there have been lots of conversations in regard to adding CTOR and plenty of discussions against the idea. Andrew Stone wrote a critique about CTOR on September 7th called "Why ABC's CTOR Will Not Scale." Coingeek has published opinions against adding CTOR in a post two days ago. The Coingeek post also leads to another critical evaluation of CTOR by the Reddit user /u/awemany and the BCH developer Tom Zander.

On the other hand, Electron Cash developer Jonald Fyookball wrote a case for adding CTOR to the Bitcoin Cash protocol this week. Of course, early on Bitcoin ABC has published some opinions as to why the development team believes CTOR should be added to the BCH codebase. Another post on r/btc, written by Mark Blundeberg, gives a comprehensive technical dive into canonical transaction ordering, and the BCH mining pool Rawpool has also given an objective evaluation towards CTOR. The Bitcoin Miner Jonathan Toomim also added some information to the mix with his block propagation data that stemmed from Bitcoin Cash stress tests that took place a couple of weeks ago.

"During the stress test, blocks propagated through the non-China mainnet at around 300–1000 kB/s — This is pretty slow, and would cause problems with orphan rates if block sizes were frequently larger than 8 MB unless we improve our block propagation algorithms," Toomim explains in his recent post.

The Pros and Cons Concerning the OP_Code CHECKDATASIGVERIFY or DSV

Then there are many discussions concerning the OP_CHECKDATASIGVERIFY (DSV) feature Bitcoin ABC wants to add. Nchain's Craig Wright says that "DSV opens many issues" and others have disagreed with the idea of adding DSV as well. One Github repository details another option the community could use instead of DSV called recursive smelting. Then Nchain's senior researcher Owen Vaughan recently published a paper called "Rabin Signatures in Bitcoin Cash." The paper posits the belief that "arbitrary messages can be signed and verified directly in Bitcoin Cash script without introducing new opcodes."

Mark Blundeberg has written another extensive post that shows the benefits of DSV called "'Pay To Identity' — a proposed use of OP_CHECKDATASIG." Moreover, another post published on Yours.org by a writer named Perica argues that DSV is already in the codebase, and has been there since the creation of the Bitcoin version 0.1 release. Perica's paper claims the current DSV model, that's already baked into the original code, is a "more powerful form than the one proposed by various developer teams."

Bitcoin Cash Supporters Have so Much to Discuss Over the Next Few Weeks Before the Fork, and Anything Can Happen Between Now and Then

There's been so much to discuss its hard to believe the fork will happen this November but right now both camps seem pretty adamant an upgrade will take place. Further people can stay rather neutral and run either Bitcoin XT or the Bitcoin Unlimited clients, as those teams plan to allow the decision to be ultimately made by majority hashrate. There's also a lot of bickering between community members over the 128MB increase and whether or not the chain should upgrade the block size now. The stress test, although remarkable, offered insight to some of the problems (block propagation times & bottleneck) introduced by exceeding blocks larger than 8MB. However, a slew of big block advocates believe the network can handle super large blocks and some think the limit should be removed entirely.

In order to keep our readers informed over the course of the next few weeks leading up to the November 15 upgrade, news.Bitcoin.com is sure to be there every step of the way.