Findings from a test by an online persona known as “reizu” revealed four nodes control 75 percent of the BSV hashrate.
Bitcoin Cash SV (BSV), a new fork of Bitcoin Cash (BTC), faced new controversy on Dec. 8 after a researcher reportedly showed how any user could spend the same coins twice on its network in a “0-conf transaction.”
Bitcoin Cash, which was created in a hard fork from Bitcoin (BTC) in August 2017, uses 0-conf (or zero-conf) to allow almost instant transactions, meaning they are almost always confirmed in the following block.
In a multi-phase test including a video demonstration posted to Vimeo, the user, known as “reizu,” succeeded in “double spending” BSV tokens in a “0-conf transaction,” demonstrating the network’s vulnerability to attack and disproving major proponent Craig Wright’s claims (in reference to BCH) that “only miners” could do so.
The double spending demonstration was filmed with POP!, a point of sale (PoS) retail application that includes double spending detection.
“I’ve done many double-spending on the Bitcoin SV network,” reizu wrote in a Dec. 8 post on Honest Cash, a BCH-based social network created after the November hard fork. Honest Cash’s information page notes that the site was created in response to the censorship they reportedly observed on other platforms during the Nov. 15 hard fork.
BSV has faced difficulties from the outset since it came into being mid-last month.
During its first week, a blockchain reorganization gained the network considerable negative publicity as high-profile critics accused it of centralization, in contrast to Bitcoin’s (BTC) decentralized network.
As part of the investigation, reizu also reported signs the BSV network was “very centralized.”
“After a few mined blocks I discovered that the transactions that were being mined were those that were sent almost always to the same nodes,” his post continued.
Out of a total of 450 nodes, reize concluded that just four control 75 percent of the network’s total hashrate.
Technical woes have so far failed to halt BSV’s success among investors meanwhile, with the fork overtaking rival Bitcoin Cash ABC (BCH) in market cap Friday.
The proposals come in the wake of dissatisfaction within and beyond the industry with current regulatory practices.
The bills, dubbed “The Virtual Currency Consumer Protection Act of 2018” and “The U.S. Virtual Currency Market and Regulatory Competitiveness Act of 2018” will go before the House of Representatives having been compiled in mid-November.
A bipartisan effort, their authors, congressmen Darren Soto and Ted Budd, said they wish to “provide data on how Congress can best mitigate these risks while propelling development that benefits our economy.”
“Virtual currencies and the underlying blockchain technology has a profound potential to be a driver of economic growth,” they said in a joint statement.
“That’s why we must ensure that the United States is at the forefront of protecting consumers and the financial well-being of virtual currency investors, while also promoting an environment of innovation to maximize the potential of these technological advances.”
The plans come as the U.S. sees continued growing pains in its journey to regulate cryptocurrency markets.
As Cointelegraph reported Friday, a new academic report has highlighted “overlapping” jurisdiction of agencies as contributing to the U.S.’ lack of appeal for industry businesses and consumers alike.
Soto and Budd correspondingly seek to broaden the basis for domestic regulation by looking beyond borders, their second bill advocating a “comparative study of the regulation of virtual currency in other countries” in order to “make recommendations for regulatory changes to promote competitiveness.”
Authorities are in the process of developing cryptocurrency and ICO rules, which could become law in Q1 2019.
Malaysia’s finance regulator and central bank issued a joint press statement Dec. 6 in which they confirmed they were “putting in place” legislation on cryptocurrency and Initial Coin Offering (ICO) assets.
The statement from the Malaysia’s Securities Commission (SC) and Bank Negara Malaysia (BNM), which follows comments from senior government official that regulation of the sector could appear in Q1 2019, also reiterates the need comply with securities laws where appropriate.
“The SC will regulate issuances of digital assets via initial coin offerings (ICO) and the trading of digital assets at digital asset exchanges in Malaysia,” it confirmed.
“Regulations are currently being put in place to bring digital assets within the remit of securities laws to promote fair and orderly trading and ensure investor protection.”
Malaysia has slowly enacted a formalized stance on cryptocurrency activities this year. Last month, in addition to revealing the potential deadline, the country’s finance minister Lim Guan Eng also stated that anyone wishing to issue a new asset could only do so with BNM’s blessing.
“I advise all parties wishing to introduce Bitcoin (style) cryptocurrency to refer first to Bank Negara Malaysia as it is the authority that will issue the decision on financial mechanism,” he said.
The moves come hot on the heels of Thailand, which is around six months into the introductory phase of its own regulation.
The patchwork regulatory setups at federal level mean it is “easy to see” how the U.S. has a bad reputation among crypto operators and investors.
United States’ cryptocurrency regulations are creating a problematic image for the country as an innovator and it needs a “more nuanced approach.” Two university professors have made this claim in an article Friday, Dec. 7, referring to a paper originally published Nov. 16.
Discussing the current regulatory setup governing cryptocurrency, Carol Goforth of Oxford University and Arkansas School of Law’s Clayton N. Little blamed the “overlapping” authority of various regulators as hindering progress.
The U.S. Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), Internal Revenue Service (IRS) and more all attempt to govern cryptocurrency, the professors say, but each from a different perspective.
“Because different agencies in the U.S. have different regulatory powers and responsibilities, each agency has tended to classify the very same assets differently in order to assert jurisdiction,” the paper reads.
As Cointelegraph has often reported, representatives of the SEC and CFTC in particular continue to be vocal about the need to comply with existing laws when issuing, dealing in or trading cryptocurrencies.
In October, CFTC chairman Christopher Giancarlo acknowledged the complexity of the situation regarding his agency and the SEC.
“…Different orientation, different histories, so we do come at these things from different perspectives,” he told CNBC’s ‘Fast Money’ segment at a conference.
For Goforth and Clayton, however, the situation does more harm than good. In a summary of their work for the Oxford Faculty of Law Dec. 7, Goforth wrote:
“Although various authorities in the US have repeatedly claimed that they do not wish to over-regulate cryptoassets or to stifle innovation in the space, overlapping regulations produced by a multitude of distinct agencies with different missions and priorities have produced a confusing mix of classifications and requirements.”
It was “easy,” she said, to “see why the US is not regarded as being receptive to crypto.”
This year, cryptocurrency exchanges including Coinbase and Bittrex began a trend of setting up operations in a more permissive jurisdiction beyond the control of the SEC and CFTC in order to offer international clients additional coins not available to their U.S. counterparts.
World’s third largest crypto exchange Huobi is looking to cater to international traders from a European base.
Huobi, which is leveraging the U.K. territory’s encouraging regulatory perspective on the cryptocurrency industry, will use its new status to launch an international platform geared to both retail and institutional traders, the release states, stating:
“The new license gives Huobi the authority to store and transmit digital assets on behalf of clients worldwide.”
Last week saw Huobi launch a derivatives market in the U.S.
“It’s no secret that we think that well-designed regulatory regimes are a key part of the future for the cryptocurrency industry,” head of global international business Lester Haoda Li commented in the press release:
“Among other benefits, our [Distributed Ledger Technology] license will allow us to open doors to more institutional investors who were previously unable or unwilling to get involved in an unregulated sphere.”
Huobi hopes to debut its service in the first half of 2019.
“To kick things off, we are launching with [over the counter] services but we have no intentions of stopping there,” Li added.
Huobi is currently the world’s third largest exchange by daily trade volume, seeing about $466 million in trades over the past 24 hours.
Gibraltar is fast catching up with permissive European counterpart Malta in luring cryptocurrency businesses to its shores.
The blockchain platform from Gibraltar’s stock exchange also gained regulatory approval this month, while state-sponsored initiatives are also hoping to address the demand for blockchain-related skills.