ShapeShift will now require you to open an account to trade cryptocurrencies on its exchange

Users of cryptocurrency exchange desk ShapeShift will no longer be able to trade digital assets without giving away their identity information.

The company has introduced a new loyalty program called “ShapeShift Membership” that will require users to open an account on the exchange and provide their “basic personal details.” While the membership is currently optional, it’ll soon become mandatory for all users.

According to ShapeShift, members will receive “special benefits,” such as “ higher trading limits, rewards on trading volume, better pricing, private market and trade data, and early access to new coins, products and services.” But since you’ll soon have no choice but to become a member to use the platform, these don’t seem to warrant the ‘special benefits’ tag.

This is also a significant shift from ShapeShift’s existing business model. Being a “ no accounts exchange ” has been its unique selling point. Users can trade cryptocurrencies on its platform without having to register or hand over their personal information.

ShapeShift hasn’t specified the reason behind this change, but it’s likely that potential regulatory hurdles are to blame.

Regulations across the globe have become extremely stringent over the years, and cryptocurrency exchange desks are required to comply with know-your-customer (KYC) and anti-money-laundering (AML) laws before letting users trade.

Financial privacy and autonomy have been the most popular features of cryptocurrencies — both with people who support and oppose them. As the industry becomes more mainstream, most cryptocurrency businesses have aligned themselves with the regulators . In fact, ShapeShift is one of the few cryptocurrency exchanges still running that don’t require users to give their personal information.

With this model set to change, it’s hard to see how ShapeShift can survive as a business. Without the “no accounts” advantage, it will definitely find it hard to compete with popular exchange desks like Binance, BitMEX, OKEx, etc. which facilitate billions of dollars in cryptocurrency trades every day.

Circle is launching a USD-backed cryptocurrency with Bitmain funding

Fintech giant Circle is launching a new cryptocurrency pegged against the US dollar reserves.

The cryptocurrency, named USDC or USD Coin, will be an ERC20 token built on top of the Ethereum blockchain.

The company has raised $110 million for the new project in Series E funding led by cryptocurrency mining behemoth Bitmain .

The other investors who are funding the project include IDG Capital, Accel Partners, Digital Curency Group, Pantera Capital, Blockchain Capital, Breyer Capital, General Catalyst and Tusk Ventures.

Circle is developing USDC based on the open-source fiat Stablecoin framework developed by its own affiliate, CENTRE . Circle is currently the only member of CENTRE, but the company plans to lure in more firms in the near future.

Circle says on its website that government certified financial institutions such as Coinbase, Square, and traditional banks will all be able to join the CENTRE network, and issue USDC tokens against the fiat deposits made by their customers.

USDC is being touted as a cryptocurrency that both tackles the volatility problem with other virtual currencies and ensures regulatory compliance.

Circle says that USDC will be particularly useful for cryptocurrency traders to hedge quickly out of trading positions by converting their assets to USDC, which will be stable because of its backing by a fiat currency.

The currency will also be available as a primary trading pair on Poloniex, which the company acquired earlier in February.

Circle started in 2014 as a peer-to-peer payments service based on Bitcoin , and has since then ventured further into the cryptocurrency space. The company currently runs a cryptocurrency-based mobile payments application, an over-the-counter (OTC) trading business, and a cryptocurrency exchange.

With the latest investment, Circle’s market value has crossed $3 billion. The company has also previously received funding from Goldman Sachs and Baidu.

It is worth noting that Circle’s USDC is not the first cryptocurrency aimed at stability, or to even be pegged against the US Dollar.

Tether, the 15th largest cryptocurrency at the moment with a market cap of over $2 billion, is another popular dollar-pegged cryptocurrency alternative.

According to Circle though, the key difference between USDC and other fiat-based cryptocurrencies is that it plans to ensure regulatory compliance for its cryptocurrency.

Circle’s choice of using Ethereum’s blockchain for their cryptocurrency is also particularly intriguing.

Ethereum’s blockchain might be a popular choice for most ICOs due to the simplicity it has to offer, but it should hardly be the pick of such a well-funded project, given the scalability issues it continues to suffer from.

Another major concern with pegged currencies such as USDC is that there’s no way to know if the number of coins they issue are in fact backed by liquid financial assets, according to Fortune .

Last November, Tether printed 50 million coins in less than a week without proof of backing from equivalent USD in the reserve — raising concerns over the actual value of the currency. It remains to be seen whether Circle can maintain a higher level of transparency with USDC.

Devs disclose critical XMR-burning bug in Monero wallets

Monero developers have disclosed a major bug that could really have been nasty. Until now, attackers could have drained Monero from exchanges (or any organizational wallet), all for the cost of a few transaction fees.

“A bug in the wallet software allowed a determined attacker to cause significant damage to organizations present in the Monero ecosystem with minimal cost,” declares the official statement. “[…] A determined attacker could burn the funds of an organization’s wallet whilst merely losing network transaction fees.”

Without getting too technical – the Monero blockchain can actually “burn” XMR under certain circumstances, as can Bitcoin and Ethereum.

In Monero’s case, the blockchain assumes transactions between identical stealth addresses to be illegitimate transactions, and “burns” one of the them, allowing just a single “correct” transaction through.

Monero’s blockchain doesn’t remove or replace burned XMR – it just makes it unusable.

The Monero community has known about burning when transactions occur between identical stealth addresses for a while – but security researchers have only just discovered that it allows hackers to siphon XMR directly from external wallets.

The disclosure steps through this process. After modifying a Monero wallet to make transactions using the same stealth address as the target wallet, “[attackers] send, say, a thousand transactions of one XMR to an exchange.”

“Because the exchange’s wallet does not warn for this particular abnormality (i funds being received on the same stealth address), the exchange will, as usual, credit the attacker with 1,000 XMR,” a Monero dev explains.

“ The attacker then sells his XMR for BTC and lastly withdraws this BTC. The result of the hacker’s action(s) is that the exchange is left with 999 unspendable / burnt outputs of 1 XMR.”

Developers created a private fix to distribute (in secret) to major exchanges and merchants so as not to draw any attention during the patching process. Monero devs note that it appears no losses were incurred due to the bug.

The statement ends with a stern warning: “T his event is again an effective reminder that cryptocurrency and the corresponding software are still in its infancy and thus quite prone to (critical) bugs.”

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