I mean, it’s right there in the name.
The largest so-called stablecoin by market cap, Tether (USDT), is supposedly pegged to the U.S. dollar and always worth $1. However, if there’s one thing we know for sure about the world of cryptocurrency, it’s that things don’t always go according to plan — a fact emphasized by Tether’s sudden plunge in value over the last 24 hours.
The stablecoin briefly traded below $.87 on the exchange Bittrex before climbing back up to the still-abysmal price of $.915 at the time of this writing.
USDT’s instability is a troubling sign not just for those HODLing that particular coin, but for potentially anyone sitting on cryptocurrency. That’s because, as demonstrated by researchers at the University of Texas this past June, Tether has likely been used to “provide price support and manipulate cryptocurrency prices.”
Critics have long argued that Tether is a scam — a claim bolstered by Tether’s seeming refusal or inability to release an audit — that artificially inflates the price of bitcoin. Even if this were not true, with almost $2.5 billion worth of USDT in circulation, a crumbling of the stablecoin — of which a temporary 13 percent price drop might be an early sign — would be more then enough to spook cryptocurrency investors and the market at large.
Which appears to be exactly what we’re seeing. On Monday, the exchange Bitfinex, which the New York Times reported last November is “owned and operated by the same people” as Tether, issued a statement declaring that it would “temporarily pause fiat deposits (USD, GBP, EUR, JPY) for certain customer accounts in the face of processing complications.”
Bloomberg suggests that concerns over those “processing complications,” and what they mean for Bitfinex’s relationships with banks, led to a crisis of confidence in Tether and a corresponding sell-off. That sell-off, in turn, both drove down USDT’s price and simultaneously drove up bitcoin’s as traders sought to dump their Tether for BTC.
None of this was helped by the fact that the exchange Binance temporarily suspended Tether withdraws (they have since resumed).
Meanwhile, traders are running to stablecoins other than Tether. TrueUSD, a stablecoin that is also supposedly pegged to the U.S. dollar, surged to as high as $1.07 on Bittrex in the last 24 hours. In other words, people were willing to pay a 7 percent premium to hold something that wasn’t Tether.
What all this means for the future of Tether specifically, and stablecoins more broadly, isn’t exactly exactly clear. However, what it means for today perhaps is. Namely, “stable” might be more of a suggestion than an accurate descriptor.
Three years ago, Inna Simone logged onto her computer, expecting to see her standard Microsoft desktop. What she encountered instead was unsettling.
“Windows along a narrow bar at the screen’s bottom were minimized; they blinked nonstop and the computer made a low-grade buzzing sound,” Simone tells The Post. “I thought something was very wrong.”
Hoping that it was just a glitch, the 70-year-old Russia-born retiree, who lives near Boston, let the computer be and departed on a planned weekend vacation. But when she returned, “there was a message that my files had been encrypted and that I [would] have to install Tor” — the untraceable browser of choice for dark-web denizens — “if I [wanted] the files back,” Simone says.
Simone was the victim of a ransomware attack: a type of cyber robbery wherein hackers lock you out of your own computer files and refuse to return them — unless you pony up hundreds or thousands of dollars. One out of 10 computer users has faced a ransomware attack, according to a survey of 20,000 people conducted by security-software maker Symantec.
As instructed, Simone downloaded Tor, and then she received another message. “I had one week to pay $500 in bitcoin. After one week, it [would] become $1,000. After two weeks, the files [would] be gone for good. I keep pictures of my granddaughter on the computer and I wanted them back!”
With help from her daughter in New York, Simone managed to secure the bitcoin. When she was ready to pay the fee, she clicked into the hackers’ one-way chat. (Yes, like Verizon, they have customer-service chat boxes. “It sounds ridiculous, but it’s true,” says Simone.) A snowstorm put her a few hours behind schedule, but she reasoned with her computer captors until they agreed not to charge her the late fee and unlocked her files. Relieved, but still furious, she signed off by cursing them in her native tongue: “I hope you all die.”
“It sounds worse in Russian than it does in English,” she says.
Simone’s situation sounds dramatic enough to hold an episode of “Homeland” — in fact, the ransoming of Carrie Mathison’s top-secret computer files drove a plot point on the Showtime series last season. But ransomware attacks are all too common in the real world, says Damon McCoy, an assistant professor at NYU.
“Over a two-year period, we saw 20,000 people making ransomware payments for a total of $16 million,” says McCoy, who worked on a study that followed bitcoin trails to track ransomware payments. “And our numbers are conservative.”
Law enforcement is often powerless to help, either because the viruses are too complex to crack or because the hackers reside in foreign countries with uncooperative governments.
And it’s not just individuals who face cyber threats. Last month, the administrative systems of the Port of San Diego were hit by hackers. In 2017, Erie County Medical Center’s computers were besieged; the Buffalo-based organization spent $10 million to beef up its infrastructure rather than pay a $30,000 ransom in order to get its files unencrypted.
When the computer system of Barnes Law in Tulsa, Okla., had 15 years worth of documents encrypted by cyber crooks, founder Ron Barnes made a sound business decision.
“I was devastated, and we paid them the $750 or so that they demanded,” Barnes, who regained access to his data, tells The Post. “They made it an amount of money that I would be willing to lose if [the hackers] didn’t give us our files back.” While the $750 sum may not sound like much, it can add up fast for hackers, Barnes points out. “They can hit a million businesses and half may agree to the $750. Then they just sit back and collect.”
There are a number of ways people and businesses can expose themselves to ransomware. Barnes believes that he got attacked when his system’s firewall temporarily went down for an upgrade. On home computers, malware, short for malicious software, is usually to blame. These programs, which can turn over control of your computer to an outside party, commonly invade when people click on suspicious e-mail links, go to shady sites for free movie downloads or simply try to watch something fun online. Simone is not sure how she got hacked, though she says it could have come via a fake software update.
Experts have a few strategies to help you protect yourself from ransomware. But if the worst comes to pass, and hackers do hijack your machine, there’s always the customer-service chat box. As Simone’s case proves, the hackers just might be willing to work with you to get their cash.
“Ransomware guys have been known to take pity,” says McCoy. “Tell them a sob story and they may give you a break. They are human.”
This story originally appeared in the New York Post.
(CNN)At 19-years-old, Betelhem Dessie is perhaps the youngest pioneer in Ethiopia’s fast emerging tech scene, sometimes referred to as ‘Sheba Valley’.
Teaching the basics of AI
New York (CNN Business)The numbers just aren’t adding up for Civil Media.
Google thinks your crypto is a joke.
The search and advertising giant released a new tool on Tuesday known as Call Screen, which helps Pixel owners screen unwanted calls. In a seemingly out of place move, the company used the product’s announcement as an opportunity to dunk on cryptocurrency.
To promote the feature, Google released a short video starring The Daily Show’s Dulcé Sloan and Ronny Chieng. Meant to demo Call Screen in action, the minute-long ad depicts the two comedians — dressed as Google employees — screening calls from a scammer and the power company.
“Cryptocurrency? That money’s not real.”
It’s the latter of these two scenarios that caught our attention.
“It’s the electric company,” Sloan explains to Chieng while reading a transcription of a phone call provided by Call Screen. “They said your bill is super high.”
Chieng replies, noting that “cryptocurrency mining takes a lot of energy.”
Here’s where it gets good.
Sloan, oozing derision, responds to Chieng with a statement seemingly designed to break the hearts of bitcoin maximalists everywhere: “Cryptocurrency? That money’s not real.”
Chieng attempts to diffuse the situation by claiming that “money isn’t real,” but it doesn’t go over well with Sloan.
“You gonna live that lie?” she asks, pointedly.
And yeah, of course this is all a joke meant to promote Call Screen. But hey, that’s kinda the point, isn’t it? Because in Google’s eyes, cryptocurrency is nothing more than a punchline.