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A Comprehensive Guide to Cryptocurrency Trading Strategies

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A Comprehensive Guide to Cryptocurrency Trading Strategies

Are you a Crypto Enthusiast who wants to learn crypto-related trading strategies? Well, we have got you covered. This article talks about what crypto trading is, the most common trading strategies, and represents ways to learn the crypto market and trading strategies.

Table of Contents 

  • What Exactly is Crypto Trading?
  • Types of Trading Strategies 
  • Concluding Lines: Ways to Learn Cryptocurrency Market and Trading Techniques

What Exactly is Crypto Trading?

Cryptocurrency trading is the act of speculating on cryptocurrency price via buying and selling the underlying coins through an exchange. The market of Cryptocurrency is decentralized, meaning they run across a network of computers and are not backed by a central authority. The underlying technology behind Cryptocurrency is Blockchain which is a peer-to-peer, decentralized distributed ledger technology. 

Out of all the cryptocurrencies, Bitcoin is undoubtedly the first and most widely used one all across the globe and has the biggest market cap of $54,280.00 at the time of writing. 

Interested in learning more about cryptocurrency trading and becoming a Certified Cryptocurrency Trader? Get started today with Blockchain Council!

Types of Trading Strategies 

  • Scalping 

Scalping is a crypto-based strategy of taking advantage of small market movements, promptly entering and exiting trades during a day, or maybe even an hour or seconds. The major advantage of this technique is that it is relatively safer than other trading strategies. And since this strategy employs minimal time frames, therefore it is possible to exit the trade anytime, even in case if you have a series of bad trades. This technique empowers users to control how much they win and lose. 

While utilizing this strategy, the trader has to watch charts precisely and stay near the trading terminal in order to be able to react promptly to market change.

  • Swing Trading 

In comparison to day trading(that involves entering and exiting positions within the same day) and trend trading(that involves holding positions for a longer period of time), this trading strategy sits in the middle between the two. It holds positions for longer than a day(unlike scalping) but typically not longer than a few weeks or a month. This strategy uses a combination of technical and fundamental factors to formulate their trade ideas.  With this particular trading, decisions can be made with less haste and more rationality unlike day trading that requires fast decisions and speedy execution. 

  • Automated Trading Bots 

This is another popular strategy for trading that is used widely. We can define automated trading bots as automated computer programs that can sell and buy cryptocurrencies independently. The primary purpose of such types of bots is to produce as much profit as possible for their consumers. The trading by these bots is done by constantly monitoring the market and reacting to the specific set of predetermined rules. Based on user preferences, these bots can analyze the various market criteria such as price, volume, orders, and others.

  • Arbitrage 

This one is the most common trading strategy in which a trader buys an asset when the price is low and sells when the price goes higher. 

  • Dollar-Cost Averaging (DCA)

Dollar-Cost Averaging (DCA) is a type of investment strategy whose aim is to lessen the impact of volatility when an investor purchases large financial assets like equities. In the UK, it is recognized as Pound Cost Averaging, whereas in the US, it is known as Constant Dollar. The major benefit of this trading strategy is that it eliminates emotional investing, reduces risks, and avoids bad timing.

  • Fundamental Analysis

In fundamental analysis trading strategy, traders use several different indicators to know if an asset is undervalued or overvalued. This strategy is used majorly by those traders who want to hold their assets for longer periods of time. The strategy is based on the idea that if an asset is undervalued, then its price and worth can be improved over time. 

  • Staking Coins and Tokens 

Staking coins and tokens is the other technique that traders opt for. They perfectly align with the diversification goal, as they generate staking profits over time. The process is simple; you just have to buy them, lock them, and stake and become a validator node in their respective network.

The best part is that you need not require any additional maintenance, as after buying and locking the staking tokens, you can forget them until the next staking cycle. Also, you can sell them at any moment, and they don’t devalue.

Concluding Lines: Ways to Learn Cryptocurrency Market and Trading Techniques

As we have explored some of the most common trading techniques, let’s explore how to master the Cryptocurrency market and learn trading through online certifications. 

Certified Cryptocurrency Expert

This certification course provides an advanced level of training that provides you with profuse expertise on cryptocurrencies and digital assets. A cryptocurrency expert is one who has a wide knowledge of cryptocurrencies and the functioning of distributed ledger technology. He possesses expert-level knowledge about bitcoin protocols and can develop and integrate applications with the bitcoin network. The training covers all the fundamentals of Cryptocurrency, such as the concept of blockchain, Initial Coin Offering (ICO), educates how to trade, what to buy, wallets, and much more.

Certified Cryptocurrency Trader

This course is meant for you if you are one of those who wants to know all about trading rules and predicting markets. A Cryptocurrency Trader is a skilled professional who knows in-depth what Cryptocurrency is and how it works and uses the acquired knowledge to make new utility tokens and Cryptocurrencies. This certification is suitable for beginners and professionals who want to give their careers a boost specializing in cryptocurrency trading. This course will help you explore trading in-depth, understand risk management and trading psychology. Additionally, you will learn about candlestick charts and trading strategies. 

Online Degree in Cryptocurrency and Trading 

This cryptocurrency certification provides detailed information on cryptocurrencies, blockchain, the technology behind cryptocurrencies, the concept of trading, how to trade, and more deeply. An Online Degree holder works closely with cryptocurrency trading, investments, & crypto consultation. With the help of this course, you will also learn about spotting the current trends and analysis, which will definitely enhance your crypto-trading skills. After completing this Online Degree, you will be able to master the concepts of Cryptocurrency & trading that are commonly used across multiple industries to solve large-scale problems.

To get instant updates about Blockchain Technology and to learn more about online blockchain certifications, check out Blockchain Council.

A Comprehensive Guide to Cryptocurrency Trading Strategies

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How has Blockchain Technology Influenced Online Trading?

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Trading has always been the most go-to profit-making technique of business fanatics, and it has worked fairly well for them. Assets building and finance managing is not an easy concept for a businessman, as they seek to make huge profits out of it and secure long term financial independence. One of the most apparent prospects for adopting online trading as a medium of investment and transaction is the lower transaction costs. Most of the traders get benefit from the traditional brokerage firms as it requires only $5 to $10 to enter into the trading market. Online trading has turned the financial world into an adaptable platform by enhancing the ease of investments and transactions.

The cryptocurrency was introduced to the economic world just over a decade ago. Since then, it has been able to attract potential investors and traders to carry out their transactions and invest in these digital currencies. With the potential of generating hefty profits, the influence of cryptocurrency has been constantly growing, not only in the business world but also over the general public in different regions. It has proven itself over the years and has risen to success through a definitive and secure mechanism that is well suited for the modern world order.

Investing Your Time and Resources in Online Trading

Online trading has made it easy for traders to make all their decisions independently. Many individuals are now investing in different stocks and cryptocurrencies all by themselves, and they have also started using cryptocurrency as a mode of transaction and payment. Furthermore, now there are different brokers that provide their services at a reasonable price and are more reliable for buying shares and stocks.

Platforms like Bitcoin Prime, offer flexibility and convenience to their users, and they execute trades efficiently and effectively. and it is a highly user-friendly platform with increased accessibility and ease-of-use handling. No doubt some of the brokers need special appointments for transactions, but other than this, an average investor or trader can immediately execute a trade.

Automation and Use of AI Technology

The world of online trading is also somewhat complicated, as there are fluctuating market trends, which reciprocate to international political, and socio-economic circumstances. These fluctuations can either account for massive profits or result in a significant amount of loss as well. However, trading platforms have simplified the trading process by supporting traders and investors through their AI-powered software that release market predictions and signals upon thorough research, and minimize the risk of loss. Traders can also practice on demo accounts to get an insight into the world of online trading and can convert their account to a normal one whenever they are ready.

Furthermore, Blockchain Technology has proven to be a revolutionizing concept in the world of online trading. It is basically a digital ledger of transactions that are stored in a computer, as each block of the chain carries the information of numerous transactions. Blockchain technology secures the entire mechanism of online crypto trading, as it eliminates the risk of hacking and theft. Additionally, the recorded ledger also provides a better insight into the market and proves vital in releasing more reliable market predictions. Therefore, platforms that use Blockchain technology are expected to perform even better in the trading world.

How has Blockchain Technology Influenced Online Trading?

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Prepare Yourself With These Top 30 Blockchain Interview Questions 2021

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Prepare Yourself With These Top 30 Blockchain Interview Questions 2021

Want to have a career in the Blockchain space? This article talks about the top 30 interview questions to get you ready for a big interview. Excited? Let’s get started.

Table of Contents 

  • Top Interview Questions You Should be Prepared for
  • Wrapping Up: How to Learn Blockchain?

Top Interview Questions You Should Know

In this section, let’s discuss the top 30 blockchain questions and answers.

1. What is the difference between Bitcoin Blockchain and Ethereum Blockchain?

Both Bitcoin and Ethereum have decentralized distributed databases of immutable records. But Bitcoin and Ethereum differ in purpose in a way that Bitcoin is considered as an alternative digital currency that offers various advantages, whereas Ethereum is regarded as the king of smart contracts that facilitates Peer-to-Peer contracts and applications via its own currency known as ETH. Ethereum was introduced with an intent to complement rather than compete with bitcoin.

2. How is Blockchain different from traditional databases?

A database is a kind of central ledger, whereas Blockchain has a distributed ledger, which means unlike the traditional databases, it is not governed by any central server. Due to this, Blockchain is a fully confidential and robust technology.

3. What is double-spending, and how can it be stopped?

It is the process of spending a balance of that cryptocurrency more than once. It is done by fooling the network to think that the original amount is never spent, thus making it available to be used for multiple transactions. 

However, this problem can be prevented in blockchain-based cryptocurrencies by utilizing a consensus mechanism known as Proof-of-Work (PoW).

Bitcoin’s solution to deal with this crucial problem is that if the majority of the nodes agree on which transaction was first to be received, later tries to double-spend are pointless.

4. Out of the three types of Blockchain, which is the best one?

Out of public, private, and consortium Blockchain, to state which one is the best would not be right because each of has its own features, usage, and requirements. If you want to design and implement your own enterprise blockchain, a private blockchain is a one-stop solution. Consortium blockchain, on the other hand, is likely to interest organizations who want to efficiently streamline communication among one another.

Features  Public  Private  Consortium 
Accessibility  Anyone  Single Person/ Central Incharge  More than one central in-charge.
Who can join? Anyone  Permissioned and known identities Permissioned and known identities
Consensus Mechanism PoS/PoW Voting or multi-party consensus algorithm Voting or multi-party consensus algorithm
Transaction Speed  Slow  Lighter & Faster  Lighter & Faster 
Decentralization Completed Decentralized  Less Decentralized  Less Decentralized 

5 How ICO differs from IPO?

ICO stands for Initial Coin Offering, whereas IPO stands for Initial Public Offering. The first difference between an ICO and an IPO is that ICO is generally for the young and risky, whereas IPO is mainly for well-settled companies. The process of issuing also differs in both. An IPO is an extensive process that requires underwriters and lengthy evaluations to determine the market price of each share. Moreover, for an IPO, you need lawyers, banks, and patience, whereas, for ICO, one needs programmers and the Internet. 

6 Name a few popular platforms for developing Blockchain-based applications?

There are multiple platforms available but before deciding on one, understand what type of Blockchain do you need, how popular is the chosen platform, what kind of scalability does your solution need, and ensure whether your preferred blockchain platform supports smart contract functionality or not. 

Blockchain platforms enable the development of blockchain-based applications that are in great demand and useful for businesses and enterprises. A few of the top platforms for developing Blockchain-based apps are Hyperledger Fabric, Ethereum, R3 Cords, Quorum, and Ripple.

7 What do you know about the lightning network?

It is an off-chain, micropayment system designed to make transaction processing faster in the Blockchain. In Lightning Network, the members can directly interact with each other without offering anything to the miners, and members can engage in numerous microtransactions with each other. And finally, when the payment channel is locked, the concluding transaction set is added to the Blockchain.

Lightning network not only helps in scalability but also makes payments instantaneous, and transactions are not dependent on miners. The network is micropayment and multi-signature friendly and, moreover, reduces the load of the main chain and decreases waiting time.

8 Distinguish between Fungible and Non-Fungible.

  • Fungible are Interchangeable: Fungible tokens are interchangeable and can be exchanged with any other token of the equivalent kind. 
  • Non-Fungible are Non-Interchangeable: Unlike Fungible tokens, such tokens are non-interchangeable as they cannot be replaced with the non-fungible token of the same type.
  • Fungible Tokens are Uniform: Each token is different from all other tokens of the same type. 
  • Non-Fungible Ones are Unique: All tokens of each type are identical in specification, and each token is identical to the other. 
  • Fungible Tokens are Divisible: These tokens can be divisible into smaller units, and one can get any number of units, and it does not matter to holders as long as the value remains the same.
  • Non-Fungible Tokens are Non-Divisible: These tokens cannot be divided in any sense.  

9 What is Blockchain Wallet?

A blockchain wallet can be defined as a digital wallet or E-wallet that allows individuals to store, manage, and transfer their cryptocurrencies such as Bitcoin(BTC), Ethereum(ETH), and many more. With such wallets, users can manage their balances of these two cryptocurrencies by paying transaction fees that depend on various factors such as transaction size. Since digital assets or cryptocurrencies are just a number, that is why the wallet keeps the private key of any particular individual, and the private key fetches the balance of that individual from the Blockchain.

10 Explain the features of DeFi.

  • Autonomy — DeFi platforms ensure that your assets are all yours, and no one has control over them.
  • Enables affordable and faster cross border payments
  • Tradability — You can trade more efficiently as they aren’t prone to an entire high-value investment at once.
  • Accessibility: DeFi has a financial system that is accessible to everyone regardless of their location.
  • Interoperability: DeFi apps and protocols are built to integrate and complement one another.
  • Transparency — In the DeFi environment, data is available publicly, which helps keep service providers impartial.
  1. Question: What are the requirements for implementing Blockchain technology for enterprise usage?

Answer: Here are the most basic ones:

  • Is the network peer-to-peer? 
  • Does the system offer smart contract functionality for the execution of decentralized applications or not? 
  • Can data be stored permanently without compromising the security measures?
  • Does it offer decentralized data storage?
  • What are its data privacy aspects? 
  • Is the immutability ensured?

12 Question: What is blockchain mining? 

Answer: Blockchain mining is a process by which transactions of a blockchain are verified without involving any third-party. Every time a transaction is sent from a Bitcoin wallet, it is sent to the transaction pool. Miners then pick hundreds of transactions and combine them to form a block with other overheads like Merkel Root, SHA-256 Hash, Nonce, etc. 

13 List some of the top blockchain development tools. 

  • Solidity
  • Remix
  • Geth 
  • Meta Mask
  • Truffle Framework

14 What, according to you, are the key Challenges for Blockchain Adoption

  • Scalability 
  • Interoperability 
  • Energy Consumption 
  • Lack of Talent 
  • Lack of standardization 

15 What are the drawbacks of Blockchain?

It is a complex technology that is hard to understand and implement. Scalability is another issue related to Blockchain. Moreover, network speed and transaction costs vary, and human errors still persist. 

16  Is it possible in Blockchain to remove one or more blocks from the networks?

No, it is not possible to manually remove a block. However, blocks can be removed with the help of default options and filters. Deleted blocks can be re-downloaded again whenever needed.

17 Enlist key features of Blockchain technology.

Transparency– Transparency is one of the significant issues in the current industry. Although to improve it, organizations have attempted to implement more rules and regulations, but there is one thing that doesn’t make any system completely transparent,i.e., centralization. But with the help of Blockchain, organizations can go for a complete decentralized network where there is no need for a centralized authority, improving the transparency of the system.

Immutability– Blockchain is immutable, meaning nobody can modify the data over a blockchain. This feature enables companies to ensure that there is no hamper of data, making their system more functional in a highly competitive market. 

High Availability– As we already defined Blockchain as a decentralized system of peer to peer network, thus it is highly available due to the concept of decentralization. It offers decentralized services that provide unique access to the options that are otherwise unavailable.

Security– Unlike traditional databases, Blockchain provides a high level of security to its users. High security is due to the cryptographic algorithms which are being run behind the Blockchain. Rather than trusting any individual or third party, in the Blockchain, one needs to trust only cryptographic algorithms.

Fast Dealing- Traditional banking organization takes a lot of time in initiating and processing the transactions and is prone to human error and often requires a third-party intermediary. Blockchain can streamline and automate the entire process without any human intervention and with complete accuracy.

Reduced Transaction Fees- As Blockchain removes the involvement of the third party, it eliminates the overhead cost of exchanging the assets; thus, it leads to reduced transaction fees. 

18 Mention types of Consensus Algorithms?

  • Proof-of-Work (PoW)
  • Proof-of-Stake (PoS)
  • Delegated Proof-of-Stake (DPoS)
  • Proof-of-Authority (PoA)
  • Proof-of-Elapsed Time (PoET)
  • Byzantine Fault Tolerance

19 Explain how PoW consensus works.

The central principle behind PoW consensus is to solve complex mathematical problems and make the largest number of guesses as quickly as possible. Such requires a lot of computational power, and by using a more efficient mining machine to run calculations, a miner can maximize profitability in terms of crypto rewards. 

In this type of consensus mechanism, miners compete to be the first one to find a hash regarding a particular block, which can only be solved using sheer computing power to make the largest number of guesses. When a miner finds the right solution, they advertise it to the whole network, receiving a reward in cryptocurrency provided by the protocol. 

20 Explain the Concept of PoS

Proof-of-Stake is a consensus algorithm that deals with the main drawbacks of PoW. In this mechanism, every block gets validated before the network adds another block to the blockchain ledger. Unlike PoW, where miners have to solve complex puzzles, in PoS, miners can join the mining process using their coins to stake. It allows users to mine for rewards using very minimal hardware and software resources. Here, the mining capacity of a particular miner depends on how many coins they already have; thus, the more coins one has, the better chances are, which indicates only the richest can have control of the consensus. 

21 Define the term CBDC

CBDC stands for Central Bank Digital Currency, which is controlled directly by the country’s central bank and is backed by national credit and government power. 

In other words, CBDC is an electronic form of central bank money that can be used to store value and make digital payments seamlessly.

22 What is DeFi technology? Explain the term, DeFi Pulse 

Decentralized Finance can be defined as financial services using smart contracts that don’t need any central authority and uses decentralized, distributed ledger technology, Blockchain. Most of the DeFi protocols are based on the Ethereum Blockchain network. 

DeFi Pulse is a data site that lets individuals find the latest analytics and rankings of all DeFi protocols. Pulse rankings track the total value that is locked into the smart contracts of DeFi protocols so that individuals can stay up to date on the latest trends.

23 What is Hyperledger Fabric? 

Hyperledger Fabric is a distributed ledger platform that comes with versatility, modularity, and performance specially crafted to provide enterprise-grade solutions. It is an open-source enterprise-grade permissioned DLT platform known to provide modularity and versatility for a broad set of industry use cases, including banking, insurance, healthcare, supply chain, human resources, etc.

24 What are Smart Contracts? What are its benefits?

A smart contract is used to describe computer code that can facilitate the exchange of money, content, shares, or anything of value. When running on the Blockchain, smart contracts becomes like a self-operating computer program that executes automatically when desired conditions are met. Since such contracts run on the Blockchain, they run exactly as programmed, without any possibility of censorship, downtime, fraud, or any third-party interference. 

  • No intermediaries ensure a quick transaction process
  • Secure and Efficient
  • No Middleman, more savings 
  • Works with accuracy and precision 
  • Establish confidence
  • Automation saves time and effort. 

25 What are dApps? Mention some of the popular dApps.

Decentralized applications (dApps) are digital applications that exist and run on a peer to peer network of computers instead of a single computer. 

Some of the dApps that are popular, innovative, and feature-rich are:

  • Cipher
  • Chainlink 
  • EOS Dynasty
  • TraceDonate 
  • Brave  

26 Explain the role of Blockchain in Governance

Due to increased decentralization, data integrity, and transparency, along with better efficiency and reduced operational costs, blockchains are becoming popular in governance. From improving transparency to streamlining the tax collection mechanism, Blockchain distributed networks can help governments to operate more efficiently and build higher levels of trust among their citizens. 

27 Mention some of the myths related to Blockchain. 

  • Blockchain and Cryptocurrencies are the same. 
  • All blockchains are public blockchains.
  • Technology only targets the finance domain. 
  • Blockchain is just a database.
  • Blockchain is free and highly accessible. 

28 Are there any restrictions for putting records in Blockchain?

No, there is no such restriction. One can store any kind of record, depending upon their requirements. The most common type of records that are recorded in Blockchain are records of transaction processing, identity management, business transactions, health management data, and all other crucial documentation.

29 Is Blockchain a trusted approach?

Blockchain is undoubtedly a trustable technology that helps participating parties to share their valuable data in a secure and tamper-proof manner. It makes use of cryptography for securing crucial information, thus making it extremely hard for attackers to play with stored data. Due to its high potential to provide security, it is widely adopted and implemented by various organizations and businesses for their operations.

30 What do you know about the future of Blockchain?

Blockchain is likely to discover a whole new way of economic transactions and contribute to global economic development immensely. Although its mainstream adoption is yet to be achieved, once it is done, it will change the way businesses operate and transform the landscape of the technology sector forever.

Wrapping Up: How to Learn Blockchain?

We hope all the questions mentioned above will help you get ready for your interview.

If you are a beginner and want to get started with Blockchain, Blockchain Council can assist you. Whether you want to become a Blockchain Developer or an Expert, or an Architect, Blockchain Council can be your one-stop solution. Blockchain Council is a globally renowned organization with an authoritative group of subject experts and enthusiasts who are evangelizing Blockchain research and development, use cases and products and knowledge for a better world. 

All Blockchain certifications offered by Blockchain Council are meant for a duration of roughly 6-8 hours and to be completed as self-paced training. 

Getting certified will help you gain an in-depth understanding of Blockchain & its implementation and prove your Blockchain skills & understanding.

To get instant updates about Blockchain Technology and to learn more about online Blockchain Certifications, check out Blockchain Council.

Prepare Yourself With These Top 30 Blockchain Interview Questions 2021

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Mexican Companies Looking for Blockchain/Crypto Mass Adoption

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According to the latest announcement by the report called “Encryption Trends in Mexico 2020/2021,” Mexican companies are looking forward to adopting Blockchain technology and cryptocurrencies. 

The study was published by a private research center, the Ponemon Institute, that indicated around 40% of companies in Mexico were eager to implement distributed ledger technology, Blockchain, and cryptocurrencies in some form. The report further mentioned that out of this percentage, 71% of companies were focused specifically on cryptocurrency usage.

Encryption Trends in Mexico 2020/2021 surveyed a total of 353 representatives from companies throughout Mexico.

Founded in 2002, Ponemon Institute was introduced by Dr. Larry Ponemon. Headquartered in Michigan, it is a private research organization that focuses on privacy, data protection, and information security policy. 

High Tide for Blockchain/Crypto Adoption

A report also suggests that out of 71% that were focused specifically on cryptocurrency usage, 51% of these companies were determined to implement Blockchain for managing assets and handling transactions. Apart from this, it was also seen that around 37% of companies expressed their interest in implementing smart contracts to bypass regulations and lower the costs of financial transactions.

Mexcian companies are adopting Blockchain in order to improve their security systems and guarantee proper encryption strategies. The protection of customer information is the main reason why organizations are adopting Blockchain technology. 

Mexican’s Active and Ongoing Role in Blockchain Space 

Mexico, the country which is less heard for Blockchain and crypto adoption, has started utilizing this technology for several purposes.

In the first week of September 2020, it was announced that Mexico plans to enable an electronic voting system based on Blockchain technology for Mexicans residing abroad so that they can participate in elections next year.

The blockchain-based voting system will not only provide authentication of the identity of the voter but will help in maintaining the integrity of all protected data and counting of votes. The cryptographic encryption is also provided in order to keep the votes secret.

Moreover, in August 2020, it was also seen that Mexico achieved a historic investment of more than USD 1,300 million in the fintech sector, whose part of these funds went toward the development of Blockchain technology.

According to a recent study conducted in the first week of October 2020, Latin America represents 7% of the entire global cryptocurrency economy, and out of this, Mexico has taken almost 11% of all retail crypto payments since July 2019. It was also noted that Mexico is leading the way when it comes to retail crypto transactions. 

To get instant updates about Blockchain Technology and to learn more about online Blockchain Certifications, check out Blockchain Council.  

Mexican Companies Looking for Blockchain/Crypto Mass Adoption

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Law Decoded: Police and thieves on their screens, Oct 2–9

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Every Friday, Law Decoded delivers analysis on the week’s critical stories in the realms of policy, regulation and law.

Editor’s note

Historians typically date the birth of international policing as we know it today to the 1800s, a response to the explosion in nationalist movements and non-governmental political radicalism in Europe. Just as new linking technologies like the telegraph and the steam engine aided and abetted new networks of political deplorables and any number of Sherlock Holmes plots, the explosion of communications tech of the last quarter-century has brought about new forms of crime. 

Which is, y’know, something everyone passively knows. In crypto, association with crime is a familiar reputational issue that is present but certainly not unique. New technology giveth and taketh away. Law enforcement’s interest in controlling new networks also grows. Paranational organizations like drug cartels and terrorist cells come to mind.

This week saw the U.S. Department of Justice press criminal charges against ISIS agents behind American deaths including James Foley’s, a move that expands their power to prosecute foreign agents as criminals under U.S. law. The FBI also busted up a home-grown far-right conspiracy to kidnap the governor of my home state of Michigan. In crypto, several jurisdictions have laid claim to new authority, with the DoJ in particular making a number of moves to expand its jurisdiction.

DoJ vs. everybody

The Justice Department’s new “Cryptocurrency Enforcement Framework” laid claim to a whole host of powers over crypto businesses that had previously been in limbo. Most notable is the generosity of what the DoJ is calling its own jurisdiction — basically anything that touches a U.S. server.

The new framework heralds a new era in the department’s crypto authority, but it’s just the clearest summary of a growing body of precedent that U.S. regulators from the SEC to the IRS have been building out for years.

The DoJ’s criminal charges against Seychelles-registered BitMEX’s leadership last week in some ways telegraphed their particular interest in combatting crime in crypto wherever in the world it may be. Most earlier involvement in crypto-linked prosecutions abroad had been focused on networks the DoJ saw as being primarily designed to finance terrorism or funnel money to sanctioned individuals. While the DoJ accused BitMEX of being a means for such action, the allegations against the leadership are not really accusing them of ideological or political illegality, but rather old-fashioned greed.

Distressing for the crypto community is, as always, the association with criminal activity. The DoJ’s report pays lip service to blockchain technology’s ability to revolutionize payments, finance, international trade, shipping, trust, consensus et al — I assume that this readership is familiar with the myriad use cases — but the report pivots compulsively to crime. From the DoJ’s side of things, that is their trade, so it makes sense, but it also adds to the unfair stigma against a technology.

Another cause for concern is that tech-savvy people in the U.S. can get around the barriers by really any crypto company, given enough time and potential profit. So as with the general trends of the last year, U.S. authorities really do seem to be building out the legal framework to give themselves jurisdiction over crypto basically anywhere. World Police indeed.

UK shuts door on whole genre of crypto investment

The United Kingdom’s Financial Conduct Authority nixed trading of crypto-based derivatives — including futures, options and swaps — for all retail investors starting in January.

While the FCA may not be as globally hawkish on crypto as its U.S. analogues, London remains Europe’s financial center. Much like Brexit itself, the predicted exodus from London has seen delays that seem to mock all bold predictions.

With its focus on retail investors, however, the FCA has obviously designed its new ban to be more of a protective maneuver for regular Britons rather than a handicap on the reigning heavyweight champs of the London Stock Exchange.

Nonetheless, as the UK’s position within both Europe and the global economy is vulnerable, implementing a stringent ban on a new asset class seems like yet another way of recusing itself from the financial future. As mentioned earlier, determined UK crypto investors will almost certainly be able to get around the new ban to access offshore exchanges with less legal accountability to the UK and more extravagant and risky leveraged offerings. 

But maybe a somewhat built-in assumption is that, while the technological implementation of any ban is going to be slow and imperfect, a retail investor capable of working around it is not exactly the person the FCA is most worried about protecting.

DoJ vs. the elusive Mr. McAfee

After decades of intercontinental outrageousness, John McAfee was arrested in Spain for tax evasion. He also faces a suit from the SEC for fraudulent ICO promotion.

McAfee first found success in the 80s at the head of the firm that produces the antivirus software that still bears his name. He left the company in the 90s and has been bouncing around the world more or less ever since, racking up guns, substance addictions, and allegations of sexual assault and murder. Also not paying his taxes, allegedly. He was posted up in Cuba out of the reach of U.S. authorities for a while.

Despite his early successes in technology, McAfee has for decades built a personal brand on foundations of infamy. The SEC’s allegations suggest that he managed to translate that megaphone into millions of dollars by plugging into the curious hypedraulic mechanics of the ICO boom. Earlier this year, he tried to launch a privacy token that he admitted was largely taken from another project. McAfee is hardly what you would call a builder. While everyone is innocent until proven guilty, McAfee’s absence from the crypto scene would be a blessing for the industry’s reputation.

Further reads

The Bank for International Settlements put out a new and extensive report on Central Bank Digital Currencies and the associated risks and prospects.

Tax attorney Jason Freeman runs down the latest memorandum from the IRS on how to get your taxes on virtual assets in order.

Writing for the Electronic Frontier Foundation, Rainey Reitman talks problems with the extradition hearings for Wikileaks founder Julian Assange.

Law Decoded: Police and thieves on their screens, Oct 2–9

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Could Feds Force Companies to Support Your Right to Repair?

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Last Tuesday in Washington, DC, while Facebook executive David Marcus was being grilled by a Senate committee over the company’s foray into cryptocurrency, the Federal Trade Commission was hosting another tech-related panel a mile and a half away. This panel received much less attention and made far fewer headlines than the $5 billion fine slapped on Facebook the week before. But it raised similar questions about the influence of big corporations over the tech we use every day.

The FTC-hosted panel, called Nixing the Fix, asked whether consumers should be able to fix the gadgets they purchase or take them to an unauthorized repair shop without incurring a penalty. Today, customers who take repairs into their own hands often risk voiding their warranty.

The panel included both proponents of the right-to-repair movement—who say tech manufacturers are putting unnecessary restrictions on gadget repairs in order to perpetuate their market dominance—and those who believe there should be guardrails around personal electronics repairs, whether for safety or cybersecurity-related reasons.

As with many FTC workshops, it’s hard to say exactly what will happen in the weeks and months to come. But this event was particularly noteworthy in that it was the first of its kind held at the federal level. To date, right-to-repair legislation has largely been taken up at the state level. And proponents of right-to-repair bills say they felt bolstered by the FTC workshop, citing it as further evidence that this issue is becoming more relevant in the age of never-ending electronic updates and subsequent repairs.

“The FTC is paying active attention to the technology world, and whether we can repair our own devices is highly relevant to that,” says Kyle Wiens, the CEO of iFixit, who sits on the side of right to repair. “It’s part of the skepticism of technology companies on the Hill right now.”

Move Fast and Fix Things

At the heart of the issue lies the Magnuson-Moss Warranty Act, passed by Congress in 1975. The act was written in response to “widespread consumer dissatisfaction with both the content and performance of warranty obligations,” according to Fordham Law Review.

In short, it’s the law that governs consumer product war­ranties, and it prevents manufacturers—from automakers to tablet makers—from denying warranty coverage on a conditional basis. Manufacturers can’t void the warranty on a product just because the consumer went and repaired it themself, swapped parts, or had it fixed by a third party.

But some manufacturers still use language suggesting that your warranty will be voided. Last April the FTC sent warning letters to six major companies: Asus, Hyundai, HTC, Microsoft, Nintendo, and Sony. (Vice first obtained the list of manufacturers by filing a request under the Freedom of Information Act.) In some cases, as with Microsoft’s Xbox One warranty, the language is just iffy enough to butt up against the law. Others are more explicit, like HTC, which applies stickers stating, “The limited warranty shall not apply if the warranty seal (void label) has been removed.”

Then, in October of last year, the nonprofit US Public Interest Research Group published a report that said 45 out of 50 companies surveyed still void warranty coverage in the case of independent repair. These companies, all members of the Association of Home Appliances Manufacturers, include Breville, Dyson, Haier, Hisense, LG Electronics, Philips Electronics, and Samsung Electronics America. (Disclosure: The author of that report, Nathan Proctor, has written opinion columns for WIRED.)

Charged Conversations

While the FTC’s warning letters on warranty seals and the US PIRG report may have been shots across the bow, the commission insists there was no single major catalyst for last Tuesday’s hearings. Democratic presidential candidate Elizabeth Warren’s support of right-to-repair legislation for the agricultural community had no influence on it either, apparently.

“A study by a private party, or a candidate putting it in their platform, really had no impact on our need to review the effectiveness of the law,” says Dan Salsburg, chief counsel and acting chief of the Office of Technology at the FTC.

Well over a hundred people attended the workshop, though the FTC has not yet shared exact numbers, and nearly 20 people spoke during the four-and-a-half-hour session. State senators David Osmek, a Republican from Minnesota, and Christopher Pearson, a member of Vermont’s Progressive Party, also weighed in.

Wiens of iFixit and US PIRG’s Proctor spoke in favor of fewer manufacturer-imposed restrictions on product repairs, as well as increased education for consumers and repair shops. Manufacturers have access to specific instructions and specialized tools, the argument goes, making it difficult or nearly impossible for consumers and repair shops to fix the products they own.

Jennifer Larson, CEO of the Minnesota-based IT hardware reseller Vibrant Technologies, said at the workshop that she’s “lost millions in revenue—I can’t even quantify over 20 years how much I’ve lost,” due to repair barriers that prove to be too costly and time-consuming for the clients she sells servers to. She hears from angry clients who are upset they have to buy brand-new machines, after unsuccessfully attempting to update firmware, and can’t sell equipment back to her. “The business has changed from whole servers to having to part them down, so you have chassis in landfills,” she said.

For Your Own Good

Part of the opposing argument has traditionally been that allowing consumers and “unauthorized” repair shops to fix electronics could result in safety hazards or security vulnerabilities.

George Kerchner, a regulatory analyst at DC-based Wiley Rein who works on hazardous materials and dangerous goods regulations, spoke at length during last week’s session about lithium-ion battery cells, and particularly “pouch cell” designs. (Kerchner is also the executive director of the Rechargeable Battery Association.) He emphasized that many batteries are designed for specific products, and therefore are designed to be repaired by those trained to work with them.

“Batteries used where there is a continuous low drain, such as in a computer, have different characteristics than those used in power tools, where an immediate burst of power is needed to drill a hole or cut a beam,” Kerchner said, holding up two similar-looking battery cells. Not knowing the difference between the two, he continued, would pose safety risks.

Earl Crane, an independent consultant who previously served as director of cybersecurity strategy at the Department of Homeland Security, laid out a multipronged argument against DIY repairs. Unauthorized repair “removes accountability” from the manufacturers, he said. He also warned that the industry would “backslide” on the security progress it has made, as more and more consumer devices have been brought into enterprise environments.

But Gary McGraw, a security researcher at Secure­repairs.org, rejected the contention that repairing gadgets would make them less secure. Other members of his organization have argued against this as well.

“How we can tease apart the spurious security argument and the repair argument? Because mixing them together is a sneaky trick,” McGraw said during his testimony. “The truth of the matter is we can design things to be repairable, we can design them to be secure, and those things are not orthogonal.”

What’s Next

Representatives on both sides of the argument indicated that the FTC workshop was a worthwhile event, although, according to one attendee, the FTC came across as some­what sympathetic to the right-to-repair side. “The fact that a federal agency is looking into this issue for the first time is a hugely positive sign,” Wiens told WIRED. “Companies have been getting away with taking our rights to fix our own things for too long.”

Kerchner, from the Rechargeable Battery Association, had a more measured response. “I think for the most part it was a very good workshop,” he said over the phone. “The FTC did a good job hearing balanced sides. But I think at the end of the day it will continue to be a state issue before it becomes a federal one.”

Kerchner is referring to the fact that, as of right now, 20 US states have considered right-to-repair bills that either close certain loopholes or require manufacturers to provide access to information, tools, and parts for independent repairs.

But federal action, if any, could still be a long way off. Post-workshop, the FTC has put out a call for empirical research and public comment, open until September 16 of this year, and the agency might come up with some findings and make recommendations. It might even make a recommendation to amend the current law. But, as the FTC’s Salsburg put it, “this can go in any number of different ways.”

Read more: https://www.wired.com/story/right-to-repair-ftc-workshop/