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$4 Billion Bitcoin Money Laundering Scheme Sees First Indictment by U.S. Jury

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Controversy has swept the bitcoin community after a Russian man was indicted by a U.S. jury for using digital currency to launder more than $4 billion for criminal networks.

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Russian “Mastermind” Apprehended

Alexander Vinnik – the alleged “mastermind” behind the money laundering scheme – was arrested in a small village in northern Greece on Tuesday following an investigation led by the U.S. Department of Justice. Just 24 hours later, the Russian national was indicted by a U.S. jury as being the operator of BTC-e, a bitcoin exchange used to launder money for drug traffickers and cyber criminals.

Reuters reports that the website Vinnik was running had “7 million bitcoins deposited, and 5.5 million bitcoins in withdrawals.”

Vinnik has been on the U.S. Ministry of Justice watch list since 2011. Authorities have also linked him to the failure of Mt. Gox, whose collapse in 2014 raised fears about the imminent demise of the cryptocurrency system.

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Also Read: Alleged BTC-E Admin Arrested for Laundering $4 Billion in Bitcoin

Cyber Crime: Bitcoin’s Enduring Legacy

Although bitcoin’s image in the mainstream has improved over the past three years, some of its detractors view it as nothing more than a conduit for illegal activity, with money laundering being only one example. The federal take-down of Silk Road in 2013 highlighted the extent to which cryptocurrency was being used to evade the authorities.

In 2016, a high-profile breach of Hong Kong-based exchange Bitfinex also shone negative spotlight on the crpytocurrency market, raising concerns about a lack of insurance protocols.

Bitcoin Prices Stable

The indictment of Vinnik had little impact on the cryptocurrency market, with bitcoin prices trading around 2,675.00, according to Bitstamp. That represents a gain of 2%. Prices fluctuated between $2,550.00 and $2,601.00 during the Asian session.

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Bitcoin

We Have to Talk About Bitcoin Again

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It hasn’t been a day since our last bitcoin article, but the world’s leading cryptocurrency has soared to fresh all-time highs yet again. This time, prices approached $6,200 for the first time ever.

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Bitcoin’s Bull Market

BTC/USD touched a session high of $6,180.00, bringing its total market cap to $103 billion. Prices were last seen hovering around $6,100, according to Bitstamp.

The rally on Saturday came less than 24 hours after the bulls tested the waters near $6,000. Analysts are almost certain that prices can still go higher, making a compelling case for investors who are still on the sidelines of the crypto rally. FundStrat Global Advisor’s Tom Lee believes prices could top $25,000 over the next five years. In fact, he says this is a conservative estimate.

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Bitcoin’s epic run has dwarfed Wall Street’s post-election rally, and has defied repeated warnings from big banks and policymakers.

Bitcoin Gold’s Private Fork

Coinbase made a startling revelation Friday in its FAQ section, where it claimed that Bitcoin Gold (BTG) has already privately forked. The private fork occurred “at a point known only to the Bitcoin Gold development team.” The newly minted digital currency will be made publicly available when the Bitcoin blockchain reaches block no. 491,407. That’s estimated to occur Wednesday.

Bitcoin Gold isn’t your typical fork in the traditional sense of the term. The Wednesday fork date is when the first Genesis block will be mined. The Bitcoin network will have no part in this process whatsoever.

Market participants are still skeptical whether BTG is legitimate. The code has not been made available, and its developers have already mined tens of thousands of blocks.

BTG’s reluctance to release its code publicly is a “major security risk,” according to Coinbase. As such, the U.S.-based exchange will not support the new coin. The broker remains committed to adding support for Segwit2x hard fork in November.

“After the fork, we will enable access when we have determined each blockchain is secure and stable,” Coinbase Dan Romero said in a blog post earlier this month. We expect this to happen within a few days after the fork, but it may take longer if additional risks emerge.

Featured image courtesy of Shutterstock. 

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Long-Term Cryptocurrency Analysis: Bitcoin Outshines Altcoins Again

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The most valuable coin had another encouraging week, as it emerged from a brief but violent correction, just to reach new highs towards the end of the week, draining capital from altcoins. The total value of the market is stagnating near the all-time high, but BTC crossed the $100 billion mark as it surged past the $6000 price level, controlling 58% of the market.

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With the long-term MACD clearly being overbought, and as the long-term target has been hit, investors should now be looking for exit points, even as the short-term uptrend is intact. The range projection target of the recent correction is found at $7000, but correction risks are already high, and only small positions should be kept in the current setup.

BTC/USD, Daily Chart Analysis

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Most of the major altcoins are trading in narrow ranges this weekend after a slightly bearish week, as the optimism surrounding Ethereum’s major update faded and the second largest coin re-entered its previous range.

Litecoin, Dash, and Monero are still looking encouraging despite the lengthy correction, while the recently, while the relatively weak Ethereum Classic IOTA continue to show worrying signs. As the Bitcoin long trade is getting stretched,  let’s see the how the daily charts of the altcoins are shaping up.

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Bitcoin

Bitcoin Hits $100 Billion as Record Rally Continues

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Bitcoin’s epic rally intensified Friday, as the token reached $6,000 for the first time in its history, bringing the total market value above $100 billion.

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Bitcoin’s Fresh Intraday High

BTC/USD touched an intraday high of $6,064.14, bringing its total market cap to $100.8 billion. That’s roughly $85 billion higher than where the market started in January.

At press time, bitcoin was trading around $5,993, up more than 5% on the day. From a technical perspective, the digital currency is considered overbought. However, the technicals are typically less reliable during extreme price movements like we’ve seen in recent weeks. The world’s leading cryptocurrency has added a staggering 520% this year.

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Bitcoin’s rally didn’t really extend to other cryptocurrencies Friday. Ethereum continued to trade just north of $300, while Ripple (XRP) consolidated a hair below 21 U.S. cents.

The cryptocurrency market’s combined market cap is roughly $173.4 billion, which is roughly $3 billion less than the Monday’s peak.

$10,000 Bitcoin?

Bitcoin could be heading north of $10,000 a unit in the not-too-distant future, according to a survey conducted by CNBC. About 49% of the 23,118 people who voted in the CNBC poll said the digital currency will reach the five-figure threshold.

Roughly 16% of respondents said bitcoin prices are heading to between $6,000 and $8,000. About a third selected the Jamie Dimon option by calling bitcoin a fraud.

Though unscientific, the survey clearly shows that the mainstream is paying attention to the rapid acceleration of cryptocurrency. At least a portion of them will investigate the matter further, and likely conclude that digital assets are a welcome addition to their portfolio.

It’s impossible to associate bitcoin’s success with just one catalyst, but it’s clear that institutional support, the allure of the blockchain and favorable regulation in markets like Japan are feeding the rally. An anticipated November hard fork is also helping to shore up price.s

A Day of Milestones

Bullish sentiment also rubbed off on U.S. stocks Friday, with the Dow Jones Industrial Average extending its rally above 23,000. The blue-chip index climbed tacked on 165 points to close at 23,328.63 after the U.S. Senate passed the 2018 budget by the narrowest of margins.

The S&P 500 and Nasdaq Composite also set fresh all-time highs, with financials and industrials leading the rally.

Featured image courtesy of Shutterstock. 

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