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Reddit Investigation Reveals Scope of Manipulation within Online Crypto Communities

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A Reddit user by the name /CryptoMaximalist recently revealed the results of an investigation into manipulation within the online cryptocurrency community. The investigation looked into how a group of certain users has been hijacking threads in the r/CryptoCurrency and r/CryptoMarkets subreddits to promote and shill specific products and projects.

Manipulation, shilling, and self-promotion are no strangers to the cryptocurrency industry so many will not be surprised by the news, but the investigation gives some interesting insight into the scope of these activities and how they are conducted. Throughout the investigation, the user managed to uncover 50 Reddit accounts which he dubbed the “Dream Network”. These accounts appear to be working together to perform specific types of manipulation known as Astroturfing and Vote Manipulation.

Vote Manipulation is relatively self-explanatory, and Astroturfing is the act of making the promotion of a specific project look natural and organic – when in fact the users promoting the project are all involved in the scam. In order to make a project look legitimate, several users will begin long and detailed comment threats featuring questions, answers, and discussions that all appear to come from separate individuals

with their own opinions. While they may appear to be separate accounts, often the questions and responses are all instigated by the same person in real life or have been agreed upon beforehand.

Several big projects implicated
Crypto projects that have been implicated in the manipulation include Ontology, Bitmax, Ultra Token, OOOBTC, MOAC, Contentos, and Dreamr, amongst others. While it is not conclusive that the operators of these projects elicited the manipulative behavior, it makes sense that those conducting the manipulation stand to make a profit from the success of the project.

To discover which accounts are likely involved in manipulation the investigation looked into the historical behavior of the accounts. Many were found to have long periods of inactivity followed by a sudden change in personality – indicating the account had likely been sold to a ‘shill‘. Shills will often buy existing accounts with high karma and a long history so that they appear more authentic. Other questionable behavior includes ‘karma farming’ – posting comments in popular threads like r/aww that typically accrue karma with very little effort.

As mentioned above, manipulation is not exactly a new concept in cryptocurrency, but hopefully, this investigation will help some newbies not lose money by investing in rubbish ‘pump n dump’ schemes.

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Crypto News Roundup and Interviews for Jan. 23, 2020

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In addition to our news roundup, for the next few episodes we’ll also be highlighting select interviews from the CoinDesk crew reporting inside the world economic forum in Davos, Switzerland.  Today we’ll hear from former CFTC Chair Christopher Giancarlo on his proposed Digital Dollar push. We’ll end the show by taking a walk with a modern cypherpunk and senior reporter Leigh Cuen.

  • Bitcoin finally breaking out of a range where it’s held over the past week, but it’s bad news for the bulls
  • During an 18-hour deposition, Telegram CEO Pavel Durov pushed back against a U.S. Securities and Exchange Commission
  • In a separate case tying together two recent scandals, former QuadrigaCX users want information about the recently indicted ‘Shadow Bank’ Crypto Capital
  • US Exchange Gemini completes accounting firm Deloitte’s
    SOC Type 2 evaluation, their highest security rating.
  • In Virginia, a lawmaker is pushing the state government to study how blockchain might be used to secure elections and how it might impact the economy moving forward.
  • In Nevada, a former beauty queen turned bitcoin-friendly entrepreneur is running as a Republican for a U.S. congressional seat
  • Amun, a Swiss digital-asset issuer has launched a new vehicle for traders who want to bet on a drop in bitcoin’s price
  • In Tokyo, two men have been accused of stealing 78 million yen (roughly $712,000) from blockchain project VIPSTAR
  • GreekReporter.com said Thursday that Greece’s Council of State approved Alexander Vinnik’s extradition to France where he will face charges of money laundering.

Today’s interviews:

  • Ex-CFTC Chair Christopher Giancarlo on why he launched Digital Dollar Project
  • Why is a Cypherphunk in Davos?

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Law Firm Representing Quadriga’s Ex-Users Want Info About ‘Shadow Bank’ Crypto Capital

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Miller Thomson, the court-appointed legal counsel for former users of the QuadrigaCX cryptocurrency exchange, is asking for help identifying any records related to Crypto Capital, which may be holding some of the exchange’s funds.

In a letter emailed to the exchange’s former customers and posted to its website, Miller Thomson wrote that Crypto Capital Corp., a “shadow bank” registered in Panama, “may have been a payment processor” for the exchange and is asking any customers who have emails or other documents which might be related to Crypto Capital to forward the communications to the legal firm.

“Representative Counsel has been investigating, since its appointment, whether any Quadriga funds were potentially retained by Crypto Capital,” Wednesday’s letter said.

An archived snapshot of Crypto Capital’s website lists QuadrigaCX as a client.

The letter referenced the ongoing court case between the U.S. Department of Justice and Crypto Capital, noting that the shadow bank’s operators are currently under indictment. Reginald Fowler, one of the alleged operators of the company, is in court

and may be heading to trial on charges of bank fraud, operating an unlicensed money transmitter and conspiracy.

Fowler intended to plead guilty to one charge of operating an unlicensed money transmitter, but negotiations between his attorneys and the prosecutors have yet to be concluded. He is now scheduled to appear in a New York courthouse in late April.

Wednesday’s letter also referenced the fact that Bitfinex, another crypto exchange, has claimed to be defrauded by Crypto Capital and is seeking information and rights to seized assets in the shadow bank’s possession in the U.S., Portugal and the U.K., three jurisdictions which have reportedly frozen Crypto Capital’s assets.

“As you are aware, Ernst & Young Inc. (the ‘Trustee’) has been unable to locate QuadrigaCX’s basic corporate records or accounting records. As a result, Representative Counsel is asking Affected Users for assistance on this matter to uncover whether Crypto Capital held Quadriga funds,” the letter said.

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TOP 3 Price Prediction: BTC, ETH, XRP — Uncertainty in Market Continues

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TOP 3 Price Prediction: BTC, ETH, XRP — Uncertainty in Market Continues

The cryptocurrency market has partially restored its position. Meanwhile, the altcoin market today is mixed. Some of the top 10 coins are located in the green zone, while others are in the red. 

Top 10 coins by Coinstats

Top 10 coins by Coinstats

The key data below for Bitcoin (BTC), Ethereum (ETH), and XRP indicate what’s to come.

NameTickerMarket CapPrice Volume (24h)Change (24h)
BitcoinBTC$157 602 979 990$8 671,44$24 584 873 2460,23%
EthereumETH$18 419 910 476$168,40$9 910 073 6690,11%
XRPXRP$10 305 414 349$0,235952$1 623 122 240-0,19%

BTC/USD 

The technical picture of Bitcoin (BTC) has not changed much since Monday. For a moment, there was an attempt to break the $8,550 level. 

BTC/USD chart by TradingView

BTC/USD chart by TradingView

However, the downward movement under pressure from the bears fit into the framework of the current volatility and it was bought back quickly enough.MUST READBitcoin (BTC) Price Skyrocketed to $14,000 Last Time This Indicator Turned Green – 

Over the past three days, local consolidation has formed. All in all, the strategy does not change, since for a longer time period, the trend has persisted and the line of least resistance is still directing upwards.

Bitcoin is trading at $8,649 at press time.

ETH/USD

Ethereum (ETH) quotes remain trading

sideways. Based on an analysis of the trading activity of participants, it can be assumed that interest in purchases is held by small speculators, while large buyers still prefer to stay away.

ETH/USD chart by TradingView

ETH/USD chart by TradingView

On the hourly chart, the chief altcoin is likely to decline in the short-term. The line of the RSI indicator is going down, confirming the ongoing dominance of buyers. Regarding the nearest price forecast, traders might expect the coin to be located at around the $165.50 level.

Ethereum is trading at $166.96 at press time.

XRP/USD

XRP is trading without significant changes. After a rebound from the support level, quotes have remained sideways.

XRP/USD chart by TradingView

XRP/USD chart by TradingView

Even though XRP has continued a sideways trading trend for a few days, it will face a decline shortly. The rate of the coin has decreased by almost 2% over the last day. What is more, the MACD indicator has just switched to a bearish trend. Summing up, the more likely scenario is a drop to the closest support of $0.23.

XRP is trading at $0.2344 at press time.#Bitcoin Price Prediction#Ethereum Price Prediction#Ripple Price Prediction


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