The president of the Federal Reserve Bank of Minneapolis, Neel Kashkari, took a jab at Dogecoin (DOGE) last week by referring to the memecoin as a Ponzi scheme, upping his rhetoric against cryptocurrencies. Cointelegraph reports: Kashkari's comments were in response to a LinkedIn poll by Paul Grewal, the chief legal officer and corporate secretary of Coinbase, who asked his connections about the proper way to pronounce "Doge." "The right pronunciation is pon-zi," Kashkari quipped.

This isn't the first time Kashkari has taken aim at cryptocurrencies. In February 2020, he said digital assets like Bitcoin (BTC) lack the basic tenants of a stable currency and praised the Securities and Exchange Commission for "cracking down" on initial coin offerings. Kashkari is not a member of this year's Federal Open Market Committee, the group responsible for setting United States monetary policy. The Minneapolis branch of the Fed will serve as an alternate FOMC member in 2022 before rotating back onto the committee as a voting member in 2023.

An anonymous reader quotes a report from Gizmodo: Bitcoin continued its dramatic plunge to $32,281 Monday morning, down 17.65% from a week earlier as some of China's largest bitcoin mining farms were shut down over the weekend. The bitcoin mining facilities of Sichuan Province received an order on Friday to stop doing business by Sunday, according to Chinese state media outlet the Global Times. The Sichuan Provincial Development and Reform Commission and the Sichuan Energy Bureau issued an order to all electricity companies in the region on Friday to stop supplying electricity to any known crypto mining organizations, including 26 firms that had already been publicly identified, according to the Global Times.

It seems that some local miners were optimistic that Sichuan's abundant hydroelectric energy would insulate the region from a cryptocurrency crackdown by authorities, but that optimism was obviously misplaced. "We had hoped that Sichuan would be an exception during the clampdown as there is an electricity glut there in the rainy season. But Chinese regulators are now taking a uniform approach, which would overhaul and rein in the booming Bitcoin mining industry in China," Shentu Qingchun, CEO of a Shenzhen crypto company told the Global Times. Videos on social media sites purported to show miners in Sichuan turning off their mining machines and packing up their businesses. Miners in China are now looking to sell their equipment overseas, and it appears many have already found buyers.

Bloomberg Businessweek describes what happened when an anonymous donor started "seeding" the tiny El Salvadoran surfing village of El Zonte (population: 3,000) with Bitcoin, turning it into the world's biggest Bitcoin experiment. Workers now receive their salaries and pay bills in Bitcoin, tourists can buy pupusas with a special Bitcoin payment app, and community projects are financed with Bitcoin donations. According to Jorge Valenzuela, an upbeat 32-year-old surfing aficionado who leads the volunteers, "it has changed my town...." [T]he most striking thing these days is the orange "B" — the international symbol for Bitcoin — splashed on garbage cans, near the entrance of the dirt-floor pizza joint, and hanging on the wall near the surf shack at the beachfront hotel. The town has never had a bank. Now the lone ATM buys and sells Bitcoin... In El Zonte, Bitcoin is a possible solution to an actual problem, as opposed to a solution in search of a problem, which is how critics describe its role in, say, the U.S...

But it was the pandemic that ultimately jump-started the project. When El Salvador's tourism industry and El Zonte's economy collapsed, Michael Peterson started making monthly transfers of about $35 in Bitcoin to 500 families around town [on behalf of an anonymous donor]. He used Wallet of Satoshi, one of the many existing smartphone apps created for small transactions using Bitcoin, which is notoriously impractical — expensive and slow — for everyday purchases. As more stores began asking how they could accept Bitcoin, Peterson decided El Zonte needed its own app. The Bitcoin Beach Wallet, which launched in September, similarly uses technology that allows for small transactions. It shows users how much they hold in Bitcoin and greenbacks and where they can spend it. Shops in town price everything in dollars, whether the underlying transaction is in Bitcoin or not. A cappuccino always costs $3.50, even if Bitcoin's value has just jumped or dropped. In this way, it behaves more like a token than a currency...

He says that 18 months after the project launched, roughly 90% of El Zonte's households are interacting with the currency regularly. "It's crazy how fast Bitcoin has caught on," he says. Businesses are using it on their own to pay bills and accept payments. Residents use transfers to the Strike app, the ATM, and peer-to-peer transactions to move money back and forth between Bitcoin and cash... Many business owners say it makes up just a small fraction of sales. Although some 85% of families have access to smartphones, many still live in cramped houses with dirt floors and tin roofs. But for others, it's clearly been life-altering. A construction crew chief pays his dozen or so employees in Bitcoin. He was sick of losing them for a half-day every month so they could travel to the nearest bank, an hourlong bus ride away, on payday...

El Zonte is among the longest-running experiments of its kind, but it's still largely untested. "I'd be very interested in seeing what happens if we enter a bear market," says McCormack, the British podcaster. "If you're a shop owner and you have $50 a day in Bitcoin sales and all the sudden that goes up to $60, that's cool. But what happens when it starts going down to $40 or $30?"

El Salvador has sought assistance from the World Bank as it implements its move to use bitcoin as a parallel legal tender alongside the U.S. dollar, Finance Minister Alejandro Zelaya said on Wednesday. From a report: Zelaya said the Central American country has tapped the World Bank for technical assistance on rules and implementation of bitcoin. Zelaya also said ongoing negotiations with the International Monetary Fund have been successful, though the Fund said last week it saw "macroeconomic, financial and legal issues" with the country's adoption of bitcoin. read more Zelaya said on Wednesday the IMF is "not against" the bitcoin implementation. Further reading: El Salvador saw bitcoin-based remittances rise 300% year over year in May.

"Within a decade, quantum computers could be powerful enough to break the cryptographic security that protects cell phones, bank accounts, email addresses and — yes — bitcoin wallets," writes CNBC.

But fortunately, that would happen only if we do nothing in the meantime, they're told by Thorsten Groetker, former Utimaco CTO "and one of the top experts in the field of quantum computing." Crypto experts told CNBC they aren't all that worried about quantum hacking of bitcoin wallets for a couple of different reasons. Castle Island Ventures founding partner Nic Carter pointed out that quantum breaks would be gradual rather than sudden. "We would have plenty of forewarning if quantum computing was reaching the stage of maturity and sophistication at which it started to threaten our core cryptographic primitives," he said. "It wouldn't be something that happens overnight."

There is also the fact that the community knows that it is coming, and researchers are already in the process of building quantum-safe cryptography. "The National Institute of Science and Technology (NIST) has been working on a new standard for encryption for the future that's quantum-proof," said Fred Thiel, CEO of cryptocurrency mining specialist Marathon Digital Holdings. NIST is running that selection process now, picking the best candidates and standardizing them.

"It's a technical problem, and there's a technical solution for it," said Groetker. "There are new and secure algorithms for digital signatures. ... You will have years of time to migrate your funds from one account to another." Groetker said he expects the first standard quantum-safe crypto algorithm by 2024, which is still, as he put it, well before we'd see a quantum computer capable of breaking bitcoin's cryptography. Once a newly standardized post-quantum secure cryptography is built, Groetker said, the process of mass migration will begin. "Everyone who owns bitcoin or ethereum will transfer [their] funds from the digital identity that is secured with the old type of key, to a new wallet, or new account, that's secured with a new type of key, which is going to be secure," he said.
There will still be the problem of users who forget their password or died without sharing their key.

But in those scenarios, CNBC suggests, "an organization could lock down all accounts still using the old type of cryptography and give owners some way to access it."

The New York Times argues that this week changed Bitcoin's reputation as "secure, decentralized and anonymous" (adding "Criminals, often operating in hidden reaches of the internet, flocked to Bitcoin to do illicit business without revealing their names or locations. The digital currency quickly became as popular with drug dealers and tax evaders as it was with contrarian libertarians.")

"But this week's revelation that federal officials had recovered most of the Bitcoin ransom paid in the recent Colonial Pipeline ransomware attack exposed a fundamental misconception about cryptocurrencies: They are not as hard to track as cybercriminals think..." [F]or the growing community of cryptocurrency enthusiasts and investors, the fact that federal investigators had tracked the ransom as it moved through at least 23 different electronic accounts belonging to DarkSide, the hacking collective, before accessing one account showed that law enforcement was growing along with the industry... The Bitcoin ledger can be viewed by anyone who is plugged into the blockchain. "It is digital bread crumbs," said Kathryn Haun, a former federal prosecutor and investor at venture-capital firm Andreessen Horowitz. "There's a trail law enforcement can follow rather nicely." Haun added that the speed with which the Justice Department seized most of the ransom was "groundbreaking" precisely because of the hackers' use of cryptocurrency. In contrast, she said, getting records from banks often requires months or years of navigating paperwork and bureaucracy, especially when those banks are overseas...

Tracking down a user's transaction history was a matter of figuring out which public key they controlled, authorities said. Seizing the assets then required obtaining the private key, which is more difficult. It's unclear how federal agents were able to get DarkSide's private key. Justice Department spokesman Marc Raimondi declined to say more about how the F.B.I. seized DarkSide's private key. According to court documents, investigators accessed the password for one of the hackers' Bitcoin wallets, though they did not detail how. The F.B.I. did not appear to rely on any underlying vulnerability in blockchain technology, cryptocurrency experts said. The likelier culprit was good old-fashioned police work. Federal agents could have seized DarkSide's private keys by planting a human spy inside DarkSide's network, hacking the computers where their private keys and passwords were stored, or compelling the service that holds their private wallet to turn them over via search warrant or other means. "If they can get their hands on the keys, it's seizable," said Jesse Proudman, founder of Makara, a cryptocurrency investment site. "Just putting it on a blockchain doesn't absolve that fact...."

The F.B.I. has partnered with several companies that specialize in tracking cryptocurrencies across digital accounts, according to officials, court documents and the companies. Start-ups with names like TRM Labs, Elliptic and Chainalysis that trace cryptocurrency payments and flag possible criminal activity have blossomed as law enforcement agencies and banks try to get ahead of financial crime. Their technology traces blockchains looking for patterns that suggest illegal activity... "Cryptocurrency allows us to use these tools to trace funds and financial flows along the blockchain in ways that we could never do with cash," said Ari Redbord, the head of legal affairs at TRM Labs, a blockchain intelligence company that sells its analytic software to law enforcement and banks. He was previously a senior adviser on financial intelligence and terrorism at the Treasury Department.
The story includes three intriguing quotes:

• Justice Department spokesman Marc Raimondi said the Colonial Pipeline ransom seizure was only the latest of "many seizures, in the hundreds of millions of dollars, from unhosted cryptocurrency wallets" used for criminal activity.
• Hunter Horsley, chief executive of cryptocurrency investment company Bitwise Asset Management, said "The public is slowly being shown, in case after case, that Bitcoin is good for law enforcement and bad for crime — the opposite of what many historically believed."
• A spokesperson for Chainalysis, a start-up that traces cryptocurrency payments, tells the Times that in the end, "cryptocurrencies are actually more transparent than most other forms of value transfer. Certainly more transparent than cash."

From today's edition of Mike Melanson's "This Week in Programming" column: This week, Docker announced some changes to Docker Hub Autobuilds — the primary one of interest being that autobuilds would no longer be available to free tier users — and much of the internet let out a collective groan to the tune of "this is why we can't have nice things...!"

"As many of you are aware, it has been a difficult period for companies offering free cloud compute," wrote Shaun Mulligan, principal product manager at Docker in the company's blog post, citing an article that explores how crypto-mining gangs are running amok on free cloud computing platforms. Mulligan goes on to explain that Docker has "seen a massive growth in the number of bad actors," noting that it not only costs them money, but also degrades performance for their paying customers. And so, after seven years of free access to their autobuild feature, wherein even all of you non-paying Docker users could set up continuous integration for your containerized projects, gratis, the end is nigh. Like, really, really nigh, as in next week — June 18.

While Docker offered that they already tried to correct the issue by removing around 10,000 accounts, they say that the miners returned the next week in droves, and so they "made the hard choice to remove Autobuilds...." For its part, Docker has tried to again stave off the criticism, offering users a discount on subscriptions, and offering members of its open source program the ability to continue to use autobuilds for free...
Docker says they've also changed Autobuild "to take advantage of BuildKit by default for improved build performance," increased the number of parallel builds for subscribers, and increased the build instance types, "so you get a beefier machine to build on!" While the changes were apparently inspired by their struggles with cryptocurrency miners, "All of these improvements should see a faster and more stable build experience with lower queue times..."

"We really appreciate your support and the community's understanding as the whole industry battles against these abusive few."

An anonymous reader quotes a report from The Guardian: Global regulators have said cryptocurrencies such as bitcoin should come with the toughest bank capital rules to avoid putting the wider financial system at risk should their value collapse suddenly. The Basel Committee on Banking Supervision, which consists of regulators from the world's leading financial centers, is proposing a "new conservative prudential treatment" for crypto-assets that would force banks to put aside enough capital to cover 100% of potential losses. That would be the highest capital requirement of any asset, illustrating that cryptocurrencies and related investments are seen as far more risky and volatile than conventional stocks or bonds.

The world's most powerful banking standards setter warned on Thursday that certain crypto-assets had proved to be highly volatile, meaning they could "present risks for banks as exposures increase, including liquidity risk; credit risk; market risk; operational risk (including fraud and cyber risks); money laundering/terrorist financing risk; and legal and reputation risks." However, it said looser rules could apply to stablecoins -- a new form of digital asset usually pegged to the value of a traditional currency -- that may require only a level of capital rules applied to traditional assets such as bonds, loans, deposits, equities or commodities. The committee's proposals, which will now go out for consultation, are meant to help protect the global financial system in case cryptocurrency prices plummet.

The International Monetary Fund said on Thursday it has a number of economic and legal concerns regarding the move from El Salvador to make bitcoin a parallel legal tender. Reuters reports: El Salvador has become the first country in the world to adopt bitcoin as legal tender, with President Nayib Bukele touting its use for its potential to help Salvadorans living abroad to send remittances back home. "Adoption of bitcoin as legal tender raises a number of macroeconomic, financial and legal issues that require very careful analysis," said Gerry Rice, an IMF spokesman, during a scheduled press briefing. "We are following developments closely, and we'll continue our consultations with the authorities." Rice said the Fund will later on Thursday meet with Bukele to discuss the bitcoin law. El Salvador is in discussions with the IMF seeking a near $1 billion program. Hours after his announcement, Bukele instructed the state-owned geothermal electric company "to put up a plan to offer facilities for Bitcoin mining with very cheap, 100% clean, 100% renewable, 0 emissions energy from our volcanos."

Americans got richer off bitcoin than any other country last year -- pocketing $4.1 billion in profits as the price of the volatile cryptocurrency soared to $29,000 from under $10,000, according to a new analysis. The New York Post reports: The US was followed by China, which cashed out some $1.1 billion in profits in 2020, according to data published Monday by blockchain firm Chainalysis. Japan came in third with $900 million, followed by the United Kingdom with $800 million and Russia with $600 million. The figures only cover realized gains, meaning that profits still held in cryptocurrencies or in exchange accounts are not included.

According to Chainalysis, Americans appear to have stepped up their bitcoin investments last year, despite nationwide lockdown orders and record unemployment. US crypto investors then cashed out toward the end of the year when the price of bitcoin has soared more than three times its $9,000 price tag. While cryptocurrency profits can be hard to track due to the currencies' intentionally decentralized nature, Chainalysis produced its estimate by collecting data including deposits, withdrawals and web traffic from cryptocurrency exchanges like Coinbase.

Hours after El Salvador became the first country to adopt bitcoin as legal tender, the nation's president -- Nayib Bukele -- has announced that he has instructed the state-owned geothermal electric company "to put up a plan to offer facilities for Bitcoin mining with very cheap, 100% clean, 100% renewable, 0 emissions energy from our volcanos."

El Salvador has become the first country to adopt bitcoin as legal tender. Lawmakers in the Central American country's Congress voted by a "supermajority" in favor of the Bitcoin Law, receiving 62 out of 84 of the legislature's vote. CNBC adds: "The purpose of this law is to regulate bitcoin as unrestricted legal tender with liberating power, unlimited in any transaction, and to any title that public or private natural or legal persons require carrying out," the law reads. Prices can now be shown in bitcoin, tax contributions can be paid with the digital currency, and exchanges in bitcoin will not be subject to capital gains tax.

US investigators have recovered millions of dollars in cryptocurrency paid in ransom to hackers whose attack prompted the shutdown of the key East Coast pipeline last month, CNN reported Monday, citing people briefed on the matter. From the report: The Justice Department on Monday is expected to announce details of the operation led by the FBI with the cooperation of the Colonial Pipeline operator, the people briefed on the matter said. The ransom recovery is a rare outcome for a company that has fallen victim to a debilitating cyberattack in the booming criminal business of ransomware. Colonial Pipeline Co. CEO Joseph Blount told The Wall Street Journal In an interview published last month that the company complied with the $4.4 million ransom demand because officials didn't know the extent of the intrusion by hackers and how long it would take to restore operations. But behind the scenes, the company had taken early steps to notify the FBI and followed instructions that helped investigators track the payment to a cryptocurrency wallet used by the hackers, believed to be based in Russia. US officials have linked the Colonial attack to a criminal hacking group known as Darkside that is said to share its malware tools with other criminal hackers. Update: Law-enforcement officials said they have seized nearly 64 bitcoin of 75 bitcoin in ransom paid.

Slashdot reader Charlotte Web summarizes a Department of Justice press release: The U.S. Department of Justice says "millions" of computers around the world were infected with the Trickbot malware, which was used "to harvest banking credentials and deliver ransomware."

In February they arrested a 55-year-old woman in Miami, Florida, saying she and her associates "are accused of infecting tens of millions of computers worldwide, in an effort to steal financial information to ultimately siphon off millions of dollars through compromised computer systems," according to Special Agent in Charge Eric B. Smith of the FBI's Cleveland Field Office. In October ZDNet was calling Trickbot "one of today's largest malware botnets and cybercrime operations."

Yesterday that woman — Alla Witte, aka "Max" — was arraigned in federal court in Cleveland, Ohio. According to the indictment, Witte worked as a malware developer for the Trickbot Group and wrote code related to the control, deployment, and payments of ransomware.

From the Department of Justice announcement:

The ransomware informed victims that their computer was encrypted, and that they would need to purchase special software through a Bitcoin address controlled by the Trickbot Group to decrypt their files. In addition, Witte allegedly provided code to the Trickbot Group that monitored and tracked authorized users of the malware and developed tools and protocols to store stolen login credentials... Witte and her co-conspirators allegedly worked together to infect victim computers with the Trickbot malware designed to capture online banking login credentials and harvest other personal information, including credit card numbers, emails, passwords, dates of birth, social security numbers and addresses. Witte and others also allegedly captured login credentials and other stolen personal information to gain access to online bank accounts, execute unauthorized electronic funds transfers and launder the money through U.S. and foreign beneficiary accounts...

If convicted, Witte faces a maximum penalty of 30 years in prison for conspiracy to commit wire and bank fraud; 30 years in prison for each substantive bank fraud count; a two-year mandatory sentence for each aggravated identity theft count, which must be served consecutively to any other sentence; and 20 years in prison for conspiracy to commit money laundering.

The indictment alleges that "beginning in November 2015, Witte and others stole money and confidential information from unsuspecting victims, including businesses and their financial institutions in the United States, United Kingdom, Australia, Belgium, Canada, Germany, India, Italy, Mexico, Spain, and Russia through the use of the Trickbot malware." The AP reports the group is now accused of targeting high-reward victims which included hospitals, schools, public utilities, and governments, as well as real estate and law firms and country clubs.

Interestingly, this case is part of the U.S. Department of Justice's "Ransomware and Digital Extortion Task Force," with its Criminal Division working with the U.S. Attorneys' Offices and prioritizing the disruption, investigation, and prosecution of ransomware "by tracking and dismantling the development and deployment of malware, identifying the cybercriminals responsible, and holding those individuals accountable for their crimes," according to the department's statement. "The department, through the Task Force, also strategically targets the ransomware criminal ecosystem as a whole and collaborates with domestic and foreign government agencies as well as private sector partners to combat this significant criminal threat."

"These charges serve as a warning to would-be cybercriminals," said Deputy Attorney General Lisa O. Monaco, "that the Department of Justice, through the Ransomware and Digital Extortion Task Force and alongside our partners, will use all the tools at our disposal to disrupt the cybercriminal ecosystem."

CNBC reports that El Salvador "is looking to introduce legislation that will make it the world's first sovereign nation to adopt bitcoin as legal tender, alongside the U.S. dollar." In a video broadcast to Bitcoin 2021, a multiday conference in Miami being billed as the biggest bitcoin event in history, President Nayib Bukele announced El Salvador's partnership with digital wallet company, Strike, to build the country's modern financial infrastructure using bitcoin technology.

Strike founder and CEO Jack Mallers said this will go down as the "shot heard 'round the world for bitcoin...."

Speaking from the mainstage, Mallers said the move will help unleash the power and potential of bitcoin for everyday use cases on an open network that benefits individuals, businesses, and public sector services... While details are still forthcoming about how the rollout will work, CNBC is told that El Salvador has assembled a team of bitcoin leaders to help build a new financial ecosystem with bitcoin as the base layer. "It was an inevitability, but here already: the first country on track to make bitcoin legal tender," said Adam Back, CEO of Blockstream.

On Wednesday, crews were putting the final touches on the Bitcoin 2021 Convention, the world's largest-ever crypto-currency conference to be held this weekend at the Mana Convention Center in Wynwood. CBS4 Miami reports: Miami's crypto conference is expected to draw 50,000 people. The convention runs from Friday, June 4 through June 6th. The conference places Miami firmly in the landscape as the new Silicon Valley. "Miami is becoming the new capital of capital. It's becoming an innovative hub. It's becoming a tier 1 city of venture capital and innovation," said Brock Pierce. "A lot of the best and the brightest from Silicon Valley and New York have moved their businesses and their firms here." And Brock Pierce should know. He's the chairman of Bitcoin Foundation who has "mined" his way through the crypto world. Oh and by the way, he's a billionaire. "Mayor [Francis Suarez] has done an incredible job of saying 'come here, Miami is the place.' As a result of it, this has become the most important city in the United States," Pierce says.

NortonLifelock has added the ability to mine Ethereum cryptocurrency directly within its Norton 360 antivirus program as a way to "protect" users from malicious mining software. BleepingComputer reports: This new mining feature is called 'Norton Crypto' and will be rolling out tomorrow to Norton 360 users enrolled in Norton's early adopter program. When Norton Crypto is enabled, the software will use the device's graphics card (GPU) to mine for Ethereum, which will then be transferred into a Norton wallet hosted in the cloud. It is not clear if every device running Norton Crypto is mining independently or as part of a pool of users for a greater chance of earning rewards of Ethereum.

As the difficulty of mining Ethereum by yourself is very high, Norton users will likely be pooled together for greater chances of mining a block. If Norton is operating a pool for this new feature, they may take a small fee of all mined Ethereum as is common among pool operators, making this new feature a revenue generator for the company. "As the crypto economy continues to become a more important part of our customers' lives, we want to empower them to mine cryptocurrency with Norton, a brand they trust," said Vincent Pilette, CEO of NortonLifeLock. "Norton Crypto is yet another innovative example of how we are expanding our Cyber Safety platform to protect our customers' ever-evolving digital lives."

An anonymous reader shares an opinion piece from Bloomberg, written by Timothy Massad: On Sept. 16, 2008, the day after Lehman Brothers filed for bankruptcy, the Reserve Primary Fund "broke the buck": Its net asset value fell below $1 per share. The fund -- often called the first money-market fund -- held $785 million of Lehman commercial paper that was suddenly worthless. Although the paper represented only 1.2% of the fund's total assets of $64.8 billion, demands for withdrawals escalated, and the fund lost two-thirds of its assets within 24 hours. This triggered a general run on money-market funds that stopped only when the U.S. Treasury issued an extraordinary guarantee of essentially all money-market fund liabilities. The episode underscored how important that $1 net asset value is to investors.

Certain cryptocurrencies known as stablecoins are today's economic equivalent of money-market funds, and in some cases their practices should have us worried that they could break the buck, creating significant damage in the broader crypto market. One such stablecoin is Tether. With a market capitalization close to $60 billion, it is almost as big as the Reserve Fund was in 2008. Each Tether token is pegged to be equivalent to $1. But, as with the Reserve Primary Fund, the true value of those tokens depends on the market value of Tether's reserves -- the portfolio of investments made with the fiat currency it receives.

Tether recently disclosed that as of March 31, only 8% of its assets were in cash, Treasury bills and "reverse repo notes." Almost 50% was in commercial paper, but no detail was provided about its quality. "Fiduciary deposits" represented 18%. Even more troubling: 10% of total assets were in "corporate bonds, funds & precious metals," almost 13% were in "secured loans (none to affiliated entities)," and the remainder in "other," which includes digital tokens. Tether separately provided a report from the accounting firm Moore Cayman stating that Tether's assets exceed "the amount required to redeem" outstanding tokens. But that report provided no description of assets. It appeared to be based solely on management's accounting, noting that Tether's policy is to use "historic cost," and that "the realizable value of these assets ... could be materially different." These facts should put holders of Tether -- and other stablecoins -- on notice that they may have trouble getting back $1 for each token. "If some of Tether's investments were to become worthless or decline in value, it would suffer the equivalent fate of breaking the buck," says Massad. "And if, for any reason, a wave of Tether holders suddenly tried to convert their tokens to cash, we do not know whether Tether could liquidate sufficient investments quickly to satisfy the demand."

"In the niche world of customers for high-end semiconductors, a bitter feud is pitting bitcoin miners against hardcore gamers," reports Quartz: At issue is the latest line of NVIDIA graphics cards — powerful, cutting-edge chips with the computational might to display the most advanced video game graphics on the market. Gamers want the chips so they can experience ultra-realistic lighting effects in their favorite games. But they can't get their hands on NVIDIA cards, because miners are buying them up and adapting them to crunch cryptographic codes and harvest digital currency. The fierce competition to buy chips — combined with a global semiconductor shortage — has driven resale prices up as much as 300%, and led hundreds of thousands of desperate consumers to sign up for daily raffles for the right to buy chips at a significant mark-up.

To broker a peace between its warring customers, NVIDIA is, essentially, splitting its cutting-edge graphics chips into two dumbed-down products: GeForce for gamers and the Cryptocurrency Mining Processor (CMP) for miners. GeForce is the latest NVIDIA graphics card — except key parts of it have been slowed down to make it less valuable for miners racing to solve crypto puzzles. CMP is based on a slightly older version of NVIDIA's graphics card which has been stripped of all of its display outputs, so gamers can't use it to render graphics.

NVIDIA's goal in splitting its product offerings is to incentivize miners to only buy CMP chips, and leave the GeForce chips for the gamers. "What we hope is that the CMPs will satisfy the miners...[and] steer our GeForce supply to gamers," said CEO Jansen Huang on a May 26 conference call with investors and analysts... It won't be easy to keep the miners at bay, however. NVIDIA tried releasing slowed-down graphics chips in February in an effort to deter miners from buying them, but it didn't work. The miners quickly figured out how to hack the chips and make them perform at full-speed again.

Iran banned bitcoin mining this week, after four months of continuous blackouts partially due to what officials say is a huge energy suck from illegal mining. Gizmodo reports: President Hassan Rouhani said at a cabinet meeting Wednesday that a drought in the region was responsible for crippling the country's supply of hydroelectric power. But, he said, the huge amount of illegal bitcoin mining that happens in Iran was tapping a staggering 2 gigawatts of power each day from the already-stressed grid. (Legal operations, meanwhile, used somewhere between 200 and 300 megawatts.)

Rouhani said around 85% of this 2-gigawatt power suck was from unlicensed operations. Iran has become a hotspot for illegal mining after many miners began to decamp there to take advantage of the country's heavily subsidized energy (partially due to the fact that Iran can't sell its oil due to international sanctions). Around 4.5% of the world's total bitcoin mining now takes place in Iran, making it one of the top 10 bitcoin-producing countries in the world. The crackdown by the government may knock it off the chart, but miners will surely sniff out another cheap source of electricity somewhere else in the world and set up shop there. [...] The ban in Iran will take effect immediately and be in place until at least September, officials say, and will include legal as well as illegal operations.
UPDATE: NBC News has additional converage — including these two interesting details:

• "Tehran allows cryptocurrencies mined in Iran to pay for imports of goods, which can help it get around the wide-ranging U.S. sanctions that had been imposed on the country..."
• "Around 4.5 percent of all bitcoin mining globally took place in Iran between January and April of this year, according to blockchain analytics firm Elliptic. That put it among the top 10 in the world, while China came in first place at nearly 70 percent."