Japanese Bitcoin Exchanges Implement Stricter KYC Requirements

Posted on April 6, 2017 | by [email protected]

The amended Payment Services Act has long been discussed in Japan, but the date which it would enter into force was not previously set. Recently, the Japanese Financial Services Agency (FSA) finally announced a date on which this act would become law.

As part of Japan’s amended Payment Services Act which would be enforced on April 1^st, the Act on prevention of Transfer of Criminal Proceeds has also been revised. This act requires Japanese Bitcoin Exchanges to Implement a Stricter Know Your Customers (KYC) process. Japanese financial Experts believe that this move would reduce the options of using Bitcoin to finance criminal activities in Japan.

What are KYC requirements

KYC Requirements are guidelines used to prevent banks from being used intentionally or unintentionally by criminal elements for money laundering activities. It also enables banks to better understand their customers and their financial dealings. This way banks or Bitcoin exchanges can investigate any unusual transactions being carried out through the bank. Recently a lot of Bitcoin critics have soiled the image of Bitcoin claiming it’s responsible for funding terrorism across Europe. This claim, however, has been rebuked by a large majority of experts in the Bitcoin ecosystem citing that these claims are baseless and politically motivated.

How KYC applies to Banking and Bitcoin Exchanges

The Japanese law amendment mainly affects Bitcoin exchanges across the country. KYC is a process by which banks obtain information about the identity and addresses of their customers. This ensures that banks’ services are not misused and it is to be completed by the banks while opening accounts. This move might not be a very good news to most Bitcoin users given the fact that many Bitcoin users enjoy the anonymity Bitcoin provides. But that same anonymity greatly hampers a country’s tax base since transaction carried out using Bitcoin are off the grid and basically cannot be taxed. Meanwhile, it’s a known fact that most users of Bitcoin don’t use the currency for any illicit activity but Bitcoin has gained the reputation as the currency of the dark web. Intelligence services across the world believe that a major crackdown on Bitcoin will badly hamper the operation of the dark web known for illegal trades and services.

Is the KYC requirement enforcement a long term solution

The major point of KYC is to prevent money laundering, combat financing of terrorism, to manage risk by creating risk profiles and assigning risk categories to customers. Banks can monitor any possible financial frauds and loan defaults. Additionally, KYC can help to check identity theft. With the current massive development in IT, hackers would be able to bypass these restrictions. Soon, free online tools would be available to carry out Bitcoin transactions undetected on a stochastic scale and the attempt might turn out to be a guard rail, if not a complete masker, for the government authorities.

Online Casinos empowered by Bitcoin wagers, Reward payments hit as high as 260 BTC

Posted on March 9, 2017 | by [email protected]

A digital innovation always revolutionizes all the fields related to it and for an innovation like Bitcoin, online casinos and gaming industry is no different. Simple, peer to peer, free of cost transactions – these features were sure to find their place in the online gaming/casino industry in the form of wagers, entry fee and flushing reward payments. This has been the scenario last couple of years with many Bitcoin online casinos popping up and diversifying the kind of experience they offer through varying wagers, games, joining bonuses and rewards. Let’s look into how the online casinos evolved through Bitcoin:

Initial Deposits and Play:

Casinos are investing to trap a sustained customer base by offering a joining bonus to give the participants a firsthand experience of the game. While this has been the trend, most casinos provide instant deposit and play facilities through Bitcoin or other sources of depositing. For instance Bitcoin Video Casino provides instant cashouts once all previous deposits have at least two confirmations. This is due to the nature of their zero confirmation play model. With instant payouts for bonuses or special attractive jackpots, Bitcoin Video Casino has gained popularity in the recent time.

Top payouts in Bitcoin Video Casino’s history:

Bitcoin Video Casino recently paid out $259.74 BTC jackpot on a 0.1 BTC on a slot machine to an anonymous player. According to the company’s website, this the largest payout of 2017 but marks the only the 19^th biggest in the Casino’s history. The top payout ever registered was 765.65 BTC for a bet of 0.2 BTC in May 2014.Coincidentally all the top 20 payouts registered were all wagered for bets less than 0.2 BTC or below.

How Bitcoin changed bonus payments:

Bitcoin has indeed changed the way online casinos have catered to customers over the years. For most part, people had to go through well set up KYC process in the past. With the kind of anonymity Bitcoin offers, simple registration and transfer of the cryptocurrency to the respective wallets on payouts is all that is required to get the fun rolling. With Bitcoin prices picking up slowly, it has been easier to facilitate mass payouts and arrange for healthy gaming at low entry fee over the past couple of years. How this trajectory would be impacted with regulations is the only thing concerning the casino owners as of now.

4 Reasons Coinbase can’t seem to Divest its Many Controversies

Posted on January 19, 2017 | by [email protected]

Coinbase is one of the most popular Bitcoin exchanges in the world and it is probably the most reputable exchange. Coinbase was the first exchange to obtain U.S. regulatory approval, it has operations in 32 countries where it serves more about 5.3 million customers. Coinbase also lay claim to being the most user-friendly platform for people cryptocurrency users, especially people new to Bitcoin. In fact, you can pay on Coinbase using EFT, ACH, SWIFT, credit cards, and PayPal among others.

One would think that Coinbase would have a smooth sailing to home because of the quality of its service. However, the firm always seems to find itself entangled in one controversy or the other as users find reasons to complain about some aspects of its service. This piece examines some of the major controversies in which Coinbase has been enmeshed in the recent past.

Sudden account closure and suspension

The first reason Coinbase doesn’t seem to have a good reputation in line with the quality of its service is the firm’s notoriety for freezing or closing user’s accounts. Coinbase tries to be compliant with necessary Anti-Money laundering (AML) and Know Your Customer (KYC) laws.

Hence, you can expect Coinbase to ask you to provide some personal information before you can use the full suite of its service. Ironically, many people use Bitcoin because of the privacy it offers on financial transactions; hence, they do not find it easy to corporate with the firm’s KYC efforts.

Accusations of Big Brother tendencies

Coinbase also tends to find itself in the blackbook of users who accuse it of having big brother tendencies in how it conducts its business. Many users accuse Coinbase of seeing your Bitcoin as its money; hence, it tends to track your spending to be sure that you don’t use its exchange for activities that it doesn’t endorse. For instance, you can’t use the exchange to pay for adult services, gambling is not permitted, and you can’t even resell your Coinbase Bitcoin on other exchanges.

A large volume of complains amplified by social media

Coinbase claims to have a user base of about 5.3 million users; hence, it is not surprising that the firm tend to have a huge volume of user complaints. However, many users have the misguided notion that coinbase support staff will be more inclined to expedite action on their complaints when made publicly via social media because any responsible firm will try to avoid bad press in the social media space.

The problem however is that every user with any semblance of complaint comes to air their grievances of social media. Hence, it is hard to filter out coinbase’s commendation from the condemnation amidst the din of social media.

Conflicts with the open source philosophy of Bitcoin

Nobody can lay claim to being the owner of Bitcoin or its underlying Blockchain technology. Blockchain technology and Bitcoin are firmly rooted in a philosophy that supports an open source nature. However, Coinbase management crossed the line when they tried to push 9 patent filings to lay claim to some important crytocurrency innovations. Their so-called innovations inclide “tips button”, “hot wallet” and “Bitcoin exchange” – these are applications that embody the very essence of Bitcoin and Coinbase was clearly overreaching in laying claim to the patents.