BitForex Returns with Functional Website, For Users’ Withdrawals
A few days after obtaining regulatory approval to resume users’ withdrawal services, BitForex recently announced that its official website has gone live. The latest development comes after the Jiangsu Province Police shut down the platform and detained its team in China on February 23, 2024. Consequently, the trading platform was inactive for several months, eliciting fears among investors with substantial valuables on the exchange. In a tweet dated July 24, 2024, the BitForex team stated, “BitForex official website will be live and open for withdrawal applications starting at 24/07/2024 20:00 GMT+8.” Dear BitForex Users, Thank you for your patience and understanding. We are pleased to announce that the BitForex official website will be live and open for withdrawal applications starting at 24/07/2024 20:00 GMT+8. For more details, please refer to our [official announcement]… — BitForex (@bitforexcom) July 24, 2024 Users’ Withdrawals Modalities While BitForex noted that it has resumed user withdrawals, a previous post highlighted some peculiar modalities to the exchange’s return. According to the old tweet, trading functions, including buying and selling, remain prohibited. Additionally, the platform disclosed that users would cease to deposit assets into their platform accounts, and new users’ registration would stop, including all services and products on the platform. Users with perpetual contracts who want to withdraw their funds from the exchange must pass through KYC (Know Your Customer) procedures. Successfully scaling through the KYC requirements for users’ withdrawals involves providing a passport photograph, phone number, and other necessary information. Going further, BitForex apologized for the inconvenience and distress users have experienced following its shutdown on February 23. It also assured users of the platform’s commitment to ensuring their assets are safe and secure. “We understand that this incident has caused significant inconvenience and distress to our users, and we sincerely apologize. We are making every effort to ensure the safety of user assets,” the BitForex team wrote on X. In addition, the exchange assured users’ of a swift customer care response, urging them to contact the support team via an official email address. Dear Bitforex Users, We sincerely apologize for the inconvenience and concerns you have experienced during this period. On February 23, 2024, the Bitforex team was detained and investigated by the Jiangsu Province police in China. This unexpected event caused the platform to… — BitForex (@bitforexcom) July 19, 2024 Background Story The Jiangsu Province Police investigation into BitForex began on February 23. It followed a massive outflow of funds valued at $57 million, which forced regulatory authorities to intervene. Aside from the token outflows, withdrawals stopped processing on the exchange, and the customer service team stopped responding to users’ complaints. Expectedly, the above happening culminated in speculations, suggesting investors might likely lose valuables. However, recent happenings are depicting otherwise. Hence, it will reignite optimism among market participants, especially those who must have lost hope.
How to Report Cryptocurrency Losses on Taxes
Cryptocurrencies have transformed the financial environment, offering new opportunities for investment and wealth generation. However, with these opportunities come tax obligations that can sometimes be confusing or overlooked. In this guide, we’ll break down everything you need to know about reporting crypto losses on your taxes. Whether you’re a seasoned crypto trader or just starting out with digital assets, this guide is for you! We’ll cover the basics of capital losses, how they impact your tax liability, and the steps to properly report them on your tax return. Key Takeaways Impact of Crypto Losses on Taxes Cryptocurrency investments are considered capital assets, similar to stocks or real estate. When you sell or exchange these assets at a lower price than what you initially paid, you incur a capital loss. Crypto losses can offset gains and reduce your tax bill, but there are reporting rules to follow. Properly reporting crypto losses is essential for staying compliant with IRS regulations. This involves accurately documenting your transactions, calculating your losses, and reporting the crypto losses on your taxes in return. Key to Reporting Crypto Losses on Taxes Before reporting crypto losses on your taxes, gather essential documentation, including transaction records, purchase/sale receipts, and any other relevant documentation. Proper documentation ensures accurate reporting and simplifies the tax filing process. Here are the other steps involved in reporting these losses accurately. Tax Savings by Claiming Crypto Losses Claiming cryptocurrency losses on your taxes can lead to significant tax savings, helping you reduce the impact of losses on your overall financial situation. Let’s examine the potential tax benefits of claiming crypto losses and how they can positively affect your tax liability. Offsetting Capital Gains Cryptocurrency losses can be used to offset capital gains realised from other investments, such as stocks or real estate. By deducting losses from gains, you reduce your taxable income, resulting in lower taxes owed. Lowering Taxable Income Even if you don’t have capital gains to offset, you can still deduct up to $3,000 of net capital losses ($1,500 for married individuals filing separately) against other income sources, such as wages or salary. Any remaining losses can be carried forward to future tax years. Consider This Scenario Let’s consider a hypothetical scenario where you incurred $5,000 in cryptocurrency losses during the tax year. If you have $10,000 in capital gains from other investments, claiming the $5,000 crypto losses would reduce your taxable gains to $5,000, potentially resulting in substantial tax savings. Even if you have no capital gains, deducting the $3,000 maximum allowed for capital losses can still lower your taxable income, leading to tax savings. Writing Off Worthless Crypto In some cases, cryptocurrency investments may become worthless, either due to outdated technology, fraudulent activities, or other reasons. When this occurs, investors may be able to write off these losses on their taxes. Here are the criteria for determining worthless crypto and the process of writing off such assets. Process of Writing Off Worthless Crypto Here’s how to write off crypto that has lost all value, ensuring you adhere to tax regulations while minimizing the impact on your financial health. Considerations for Claiming Losses on Worthless Crypto Claiming losses on worthless crypto can offer some financial reprieve, but it’s crucial to approach this process with precision and informed strategy. Below are key considerations to keep in mind when declaring these losses on your taxes: Other IRS Reporting Requirements for Crypto While reporting cryptocurrency losses is essential for tax purposes, there are additional IRS reporting requirements that crypto investors need to be aware of to maintain compliance. Here are some requirements to ensure comprehensive reporting of crypto transactions. Classification as Property The IRS treats cryptocurrency as property for tax purposes, meaning that transactions involving crypto must be reported similarly to transactions involving stocks or real estate. Taxable Events Various crypto transactions, including sales, exchanges, mining, and receipt of income in cryptocurrency, may trigger taxable events that require reporting to the IRS. Form 8949 and Schedule D Crypto transactions must be reported on IRS Form 8949, “Sales and Other Dispositions of Capital Assets,” and Schedule D of your tax return. This includes both gains and losses realised from crypto transactions. Fair Market Value Determination When reporting crypto transactions, use the fair market value (FMV) of the cryptocurrency at the time of the transaction. FMV can be determined from reputable cryptocurrency exchanges or pricing websites. Foreign Account Reporting If you hold cryptocurrency in foreign accounts or exchanges, you may have additional reporting obligations, such as filing FinCEN Form 114 (FBAR) or Form 8938 (FATCA). Tax Implications of Crypto Scams Cryptocurrency scams and fraudulent activities have become a significant concern for investors, often resulting in financial losses and legal complications. Let’s examine the tax implications of crypto scams and how investors should handle reporting losses incurred from fraudulent activities. Recognizing Crypto Scams The potential for high returns in crypto trading has attracted not only genuine investors and innovators but also a variety of scams designed to prey on the unwary. Below, we outline the most common types of crypto scams to watch out for, helping you stay informed and protect your investments. Ponzi Schemes and Pyramid Schemes Scammers may lure investors with promises of high returns through fraudulent investment schemes, such as Ponzi or pyramid schemes, where returns are paid out using funds from new investors. Fake ICOs and Token Sales Fraudulent Initial Coin Offerings (ICOs) and token sales may deceive investors into purchasing worthless or non-existent tokens, resulting in financial losses. Phishing and Hacking Phishing attacks and hacking incidents targeting cryptocurrency users can lead to unauthorised access to wallets and exchanges, resulting in theft of funds. Treatment of Losses from Crypto Scams There’s a silver lining for victims in the form of tax relief. Understanding how to treat losses from crypto scams can help mitigate the financial impact. The following are the key aspects every investor must know: Deductibility of Losses Losses incurred from cryptocurrency scams are generally deductible as capital losses on your tax
Comparison Between Centralized and Decentralized Crypto Exchanges
Cryptocurrency exchanges are the foundation of the digital asset system. They help people trade and manage digital currencies. As of 2023, there are over 420 million people using cryptocurrencies around the globe. Every day, these people trade more than $53.16 billion worth of cryptocurrencies. There are two main types of crypto exchanges: centralized and decentralized. Centralized exchanges (CEXs) act as intermediaries between buyers and sellers, providing a more user-friendly experience but requiring users to trust a third party with their funds. On the other hand, decentralized exchanges (DEXs) operate without intermediaries, offering greater privacy and security but often at the cost of ease of use and liquidity. In this article, we look into the key differences between centralized and decentralized exchanges, weighing their pros and cons to help you decide which type of exchange is best suited for your needs. Key Takeaways What is Cryptocurrency Exchange? A cryptocurrency exchange is a platform that allows people to buy, sell, or trade cryptocurrencies for other digital currencies or traditional currencies like US dollars or euros. Think of it like a stock exchange but for digital assets. These platforms play a crucial role in the crypto context as they provide a marketplace for trading various cryptocurrencies. Cryptocurrency exchanges are vital in the crypto environment. They connect buyers and sellers, enabling them to exchange digital currencies for other assets. Without these exchanges, it would be challenging for people to access cryptocurrencies. They also provide price transparency and liquidity, which are essential for the healthy functioning of the crypto market. Evolution of Cryptocurrency Exchanges Cryptocurrency exchanges have evolved significantly since the launch of Bitcoin in 2009. The first generation of exchanges were centralized platforms that faced numerous security issues. The infamous Mt. Gox hack in 2014, where 740,000 bitcoins were stolen, highlighted the need for more secure platforms. This led to the development of the second generation of exchanges with improved security measures. These platforms, like UEEx, became popular due to their user-friendly interfaces and a wide range of services, including spot trading, futures trading, and staking. The latest evolution in cryptocurrency exchanges is the rise of decentralized exchanges (DEXs), like Uniswap and Sushiswap. These platforms operate without a central authority, using smart contracts to facilitate trades directly between users. Cryptocurrency exchanges however have democratized access to digital assets, enabling millions of people worldwide to participate in the crypto economy. Centralized Exchanges (CEXs) Centralized exchanges (CEXs) are online platforms that facilitate the trading of cryptocurrencies by acting as intermediaries between buyers and sellers. These exchanges operate under a centralized authority, which oversees transactions, ensures security, and provides various features to enhance the trading experience. How Does a Centralized Exchange Work? CEXs operate similarly to traditional stock exchanges. Here’s a breakdown of their key functions: Matching Orders between Buyers and Sellers Centralized exchanges use a sophisticated matching engine to pair buy orders with sell orders. When a buyer’s offer matches a seller’s asking price, the exchange executes the trade instantly. For example, you want to buy Bitcoin (BTC) on Binance, a popular centralized exchange, using US Dollars (USD). Here’s how the matching engine works in practice: Order Book An order book is a digital ledger maintained by the exchange, listing all buy and sell orders for a particular cryptocurrency. It shows the price and quantity of each order, providing transparency and helping users make informed trading decisions. Role of Central Authority Centralized crypto exchanges rely on a central authority to manage various aspects of the platform’s operations ensuring a smooth and secure trading environment. Here’s how they achieve this through multiple functionalities: Transaction Processing The central authority uses a sophisticated matching engine to pair buy and sell orders. This engine operates quickly to ensure that trades are executed almost instantly when a buyer’s offer matches a seller’s asking price. For example, If Alice wants to buy 1 BTC at $30,000 and Bob wants to sell 1 BTC at $30,000, the matching engine pairs these orders and executes the trade instantly. Security Measures The central authority implements various security measures to protect users’ funds and personal information. This includes encryption, two-factor authentication (2FA), cold storage for cryptocurrencies, and regular security audits. They also have systems in place to detect and prevent fraudulent activity. Customer Support The central authority provides customer support to assist users with any issues they may encounter. This can include helping users navigate the platform, resolving transaction issues, and answering questions about the exchange’s services. They typically offer support through various channels, such as email, live chat, and phone. Regulatory Compliance The central authority ensures that the exchange complies with all relevant laws and regulations. This includes conducting Know Your Customer (KYC) and Anti-Money Laundering (AML) checks, reporting to regulatory bodies, and cooperating with law enforcement agencies. Revenue Generation Centralized exchanges generate revenue through various streams, including: Role of KYC and AML CEXs typically invest heavily in security measures to protect user funds. However, it’s important to remember that you don’t hold the private keys to your crypto on a CEX. The exchange acts as a custodian, holding your digital assets on your behalf. To comply with regulations (KYC – Know Your Customer, AML – Anti-Money Laundering), CEXs require users to verify their identities, adding an extra layer of security but also potentially limiting anonymity. Popular CEX Examples The following are examples of CEX: Key Features of a Centralized Exchange CEXs offer several key features: Pros of Centralized Exchanges The advantages of CEX include: Cons of Centralized Exchanges The following are the disadvantages of CEX: Susceptible to Hacks Centralized systems can be targets for hackers, leading to potential security breaches and loss of funds. For instance, In 2014, the Mt. Gox exchange was hacked, leading to the loss of 740,000 Bitcoins, worth hundreds of millions of dollars at the time. Not Your Keys, Not Your Coins Users do not have direct control over their private keys, meaning their funds are stored and managed by the exchange. QuadrigaCX, a Canadian cryptocurrency exchange, lost access
Blockchain Transaction Speed and Cost Stats: What You Need to Know
Is there a way to avoid the high fees and slow speeds often associated with blockchain transactions? The answer is yes. The blockchain transaction speed and cost are revealed in this comprehensive article. Find out which blockchains prioritize transactions and how to choose the best blockchain platform. Overview of Blockchain Transaction Speed and Cost This makes Solana 46 times faster than Ethereum and over 5 times faster than Polygon, which boasts the highest TPS among Ethereum scaling solutions Tectrum: The Fastest Blockchain with 1,200,000 TPS Tectrum blockchain is changing ideas about scalability and transaction speeds in blockchain. It is upending preconceived notions. As blockchain technology developed, it became clear that large transactions would need platforms. Tectrum has unmatched scalability and efficiency. It has established itself as a leader in high-speed transaction processing. It’s doing so using cutting-edge technology and creative business methods. Recent data shows that Tectrum is the fastest blockchain. It achieves an amazing 1,300,000 transactions per second. Tectrum sets a new industry benchmark with its record-breaking speed. This capability showcases its power to process massive transactions with ease. Tectrum’s breakthrough in transaction speed could change the blockchain ecosystem. It will help big applications work better. It’s also going to cut costs from delays and congestion. This progress encourages the spread of blockchain. It’s happening in many sectors. Solana Achieves Record High of 1,504 TPS When blockchain technology was first introduced, Bitcoin and Ethereum faced big challenges. These were with transaction speed and cost. High fees and slow processing times made people doubt their ability to scale. They doubted that they could be practical for widespread use. New blockchains and scaling solutions are emerging to address these issues. This prompts a need to test their transaction speed (TPS) and cost. On April 6, 2024, Solana hit a record. It reached 1,504 transactions per second during the memecoin mania. This achievement makes Solana 46 times faster than Ethereum. It’s over 5 times faster than Polygon, the top Ethereum scaling solution’s TPS. Solana’s breakthrough in transaction speed showcases its potential to handle high transaction volumes efficiently, reducing congestion and transaction costs. This improvement makes Solana attractive for finance and DApps. It will foster wider blockchain adoption in many industries. Read Also: Hashrate Distribution in 2025: How Countries Stack Up Non-EVM Blockchains’ Average Peak TPS of 284 Ethereum Virtual Machine (EVM)-based blockchains have been the standard for many developers. They are popular due to their compatibility and established infrastructure. But they often face limitations in transaction speed and scalability. Non-EVM blockchains, such as Sui, TON, and Near Protocol, exhibit an average peak TPS of 284. This rate is 3.9 times faster than EVM-based blockchains. It shows their efficiency in processing transactions. Non-EVM blockchains perform well. They show potential as alternatives to EVM-based platforms. Their faster transactions can drive innovation and competition in the blockchain ecosystem. This will encourage developers to examine these platforms for better and scalable solutions. Binance Smart Chain (BSC) Achieves 378 TPS Binance Smart Chain (BSC) has become a big player in the blockchain space. It aims to offer faster and cheaper transactions than Ethereum. We need to test its performance against other leading blockchains and scaling solutions. BSC achieved a peak of 378 TPS. This surpassed Ethereum’s scaling solutions in speed. BSC’s performance demonstrates its ability to handle larger transaction loads. BSC has performed well. It’s a competitive platform for financial transactions and decentralized applications. It offers users lower fees and faster processing times. This makes it attractive to developers and businesses. They want to use blockchain for scalable apps. Polygon Records 190 TPS Polygon is an Ethereum scaling solution. It addresses the network’s limits in speed and cost. People compare its performance to Ethereum and other scaling solutions. This comparison is important for understanding its effectiveness. Polygon recorded a peak TPS of 190, making it 8.4 times faster than Ethereum itself. This shows Polygon’s skill at boosting transaction speeds. It also cuts congestion on the Ethereum network. Polygon’s faster transactions support the development of better DApps on Ethereum. They offer increased complexity and ease of use. This can lead to wider use of Ethereum-based apps. It will promote growth of the blockchain ecosystem. 24 out of 25 Blockchains Set Their Highest Real TPS The blockchain industry has seen rapid progress. Many platforms are working to improve their transaction speeds and scalability. Tracking the highest real TPS of these blockchains provides insights. It shows how they have progressed. In the past year, 24 out of 25 blockchains set their highest TPS. This includes platforms like Tron and zkLink Nova. This trend shows significant improvements in the industry. The improvements are in transaction speed and efficiency. Many blockchains have achieved a record throughput per second. This reflects ongoing industry innovation and improvement. Faster transactions make blockchains more useful. They encourage mainstream adoption and use in many sectors. Comparative Data of Blockchain Transaction Speeds This is a comparative table of transaction speeds and throughput for various popular blockchain networks: Blockchain Network Transaction Speed (TPS) Throughput (TPM) Bitcoin ~7 TPS ~420 TPM Ethereum ~32 TPS ~1920 TPM Solana ~1504 TPS ~90,240 TPM Ripple ~1500 TPS ~90,000 TPS Litecoin ~56 TPS ~56 TPM EOS ~4,000 TPS ~240,000 TPM Cardano ~257 TPS ~15,420 TPM Tectrum Blockchain ~1,300,000 TPS ~72,000,000 TPM Note: Transaction speeds and throughput can vary based on network conditions, protocol upgrades, and optimizations. These values are approximate and subject to change. What are the Challenges and Tradeoffs of Blockchain Transaction Speed and Costs? Blockchain transaction speed is not easy to optimize, as it involves a trade-off between scalability, security, and decentralization. Scalability Scalability refers to the ability of the network to handle a large volume of transactions without compromising performance. One way to achieve scalability is by increasing block sizes or reducing block times to process more transactions per second (TPS). However, increasing scalability often comes at the cost of decentralization. For example, larger block sizes require more computational power and storage space, making it challenging for smaller nodes to
How to Know if Someone Is Scamming You With Bitcoin?
Bitcoin, launched in 2009, has changed how we think about money by introducing a digital currency not controlled by banks or governments. However, it has also attracted scammers who come up with new ways to trick investors. In this guide, we’ll give you essential tips to spot and protect yourself from Bitcoin scams. Key Takeaways Bitcoin Scams 101 Today, Bitcoin is a leading digital currency, offering a decentralized way to handle money outside of traditional banks. However, its popularity has also attracted scammers. Bitcoin’s features, such as anonymity and no central control, attract both genuine users and fraudsters. This makes it important to understand Bitcoin scams and how to protect yourself from them. Phishing Attacks Image source: Pixel One of the most prevalent forms of Bitcoin-related fraud is the phishing attack. Phishing is a deceptive practice where scammers masquerade as trustworthy entities to lure individuals into providing sensitive information. In the context of Bitcoin, these scams often involve fake websites or emails that mimic legitimate exchanges or wallet services. Unsuspecting users, thinking they are logging into their accounts or updating their information, inadvertently hand over their login credentials, wallet keys, or personal data to scammers. Of course, the outcome of this can be disastrous, as this information is then used to drain their Bitcoin wallets or commit identity theft. The sophistication of these phishing attempts can vary, but they often employ persuasive language, urgent calls to action, and seemingly legitimate links that lead to expertly crafted fake websites. Fake Exchanges and Wallets The lure of low transaction fees or promises of enhanced security can draw users to fake exchanges and wallets. These platforms are set up with the sole intent of scamming people. They may offer services to trade or store Bitcoin, but once a user deposits their cryptocurrency, the operators abscond with the funds, leaving victims with no means to reclaim their digital assets. These fake platforms can be particularly convincing, with professional-looking websites with functionalities that mimic reputable cryptocurrency service providers. Ponzi Schemes Another form of Bitcoin scam is the Ponzi scheme. Ponzi schemes are investment scams that pay returns to earlier investors with the funds collected from newer investors rather than from any actual profit earned. In the Bitcoin sphere, these schemes often manifest as investment opportunities promising high returns for depositing your Bitcoin. Initially, returns are paid out to earlier investors to lend the scheme an air of legitimacy. However, as with all Ponzi schemes, they inevitably collapse when the flow of new investors dries up, leading to substantial losses for most participants. Two of the most infamous Bitcoin Ponzi schemes are Bitconnect and OneCoin. Bitconnect (2016-2018): Bitconnect promised high returns through a lending program. Investors were encouraged to lend Bitcoin in exchange for Bitconnect Coin (BCC). The platform collapsed in 2018, causing investors to lose $2.4 billion. OneCoin (2014-2017): Marketed as a cryptocurrency, OneCoin sold educational packages and promised high returns. In reality, there was no blockchain behind OneCoin, making it a complete scam. Authorities estimate investors were defrauded of approximately $4.4 billion. Fake ICOs Initial Coin Offerings (ICOs) are a fundraising mechanism for new projects where investors can purchase tokens in anticipation of a project’s launch. However, the unregulated nature of ICOs has paved the way for scammers to create fake ICOs for non-existent projects or technologies. These scammers create elaborate whitepapers and marketing materials to sell tokens for these phantom projects, disappearing with the investors’ funds once they have collected enough money. A good example of a fake I.C.O. was Pincoin and iFan’s scam in 2018. This scam raised $660 million from around 32,000 investors. Pincoin and iFan, run by Modern Tech in Vietnam, promised high returns but disappeared with the funds, leaving investors with worthless tokens. Ransomware and Malware Ransomware and malware represent a more direct attack on users’ digital lives. These malicious software programs are designed to infiltrate systems, encrypt files, or seize control of computing resources. Here are two good examples of ransomware scams: CryptoLocker CryptoLocker, a notorious ransomware, surfaced on September 5, 2013, via a Trojan horse. It infiltrated Windows systems through malicious email attachments. Once activated, it encrypted files and demanded a ransom in Bitcoin for the decryption keys. The severity of CryptoLocker was substantial, affecting over 250,000 systems within a few months. The estimated total ransom payments reached $3 million before law enforcement shut it down in 2014. WannaCry Another significant ransomware cryptoworm targeted Microsoft Windows users in May 2017. Exploiting a vulnerability in Windows systems, it spread rapidly across 150 countries, encrypting files and demanding a Bitcoin ransom. The malware, also known as WannaCry, primarily affected critical sectors like healthcare and finance, causing widespread disruption. The NHS in the UK was severely impacted, leading to canceled appointments and delayed treatments. WannaCry’s impact was profound, with estimated damages exceeding $4 billion globally. Efforts to curb its spread involved patching systems and developing decryption tools. From the examples, the scammers demanded the victims pay a ransom in Bitcoin to regain access to their files or systems. This form of scam exploits the irreversible nature of Bitcoin transactions, ensuring that once the ransom is paid, there is only one way to retrieve the funds if the scammers uphold their end of the bargain. Famous Bitcoin Scams Image Source: Pixel Bitcoin scams are no joke; those who have fallen victim understand the pain that comes with it. The Mt. Gox hack and the Bitconnect scheme are two of the most infamous incidents in the cryptocurrency world, both serving as stark reminders of the risks associated with digital assets. Mt. Gox Hack Mt. Gox, based in Tokyo, was once the world’s largest Bitcoin exchange, handling over 70% of all Bitcoin transactions worldwide by 2014. However, its prominence made it a prime target for hackers. The attack on Mt. Gox wasn’t a single event but rather a series of breaches that ultimately led to its downfall. The most significant blow came when it was discovered that around 850,000 Bitcoins, worth approximately