Blockchain Bug Bounties Amounted to Close to $1 Million in 2018

It has been reported that this year alone white hat hackers have been awarded $878,000 in blockchain-related bug bounties this year, tech news website TheNextWeb reports on Dec. 30th.

What are Bug Bounties?

These are a type of competition or programs offered by many websites and software developers by which individuals can receive recognition and compensation for discovering and reporting bugs, especially those pertaining to exploits and vulnerabilities. These programs allow the developers to discover and resolve bugs before the general public is aware of them, preventing incidents of widespread abuse. Bug bounty programs have been widely used by a large numbers of organizations, including major platforms such as Facebook, Yahoo, Microsoft, Google and others.

According to data from the tech news site – TheNextWeb, the top three companies with the largest payouts include EOS creator Block.one, cryptocurrency exchange platform Coinbase and blockchain platform TRON.

EOS Leading the Chart

Just from Block.one alone, white hat hackers have earned $534,500 on HackerOne, which operates as a bug bounty platform connecting companies with hackers. In fact, Block.one is reportedly responsible for 60% of all the bounties handed out this year.

Major cryptocurrency exchange Coinbase comes in as the second-largest contributor and thus spent $290,381 in 2018. Blockchain platform TRON is third-largest bounty spender, having paid out $76,200 this year for bug bounties.

According to a HackerOne spokesperson, nearly 4% of all bounties awarded on the platform in 2018 came from blockchain and cryptocurrency companies. In addition to that, it was noted that the average bounty in the blockchain industry reached $1,490 this year, whereas the average HackerOne bounty in Q4 2018 reached to about $900.

As it has recently been reported, EOS decentralized apps (DApps) have lost up to $1 million as a result of various hacks ever since July. On that note, hardware wallet Ledger has recently expressed regret over the fact that the security researchers have publicly disclosed vulnerabilities in its hardware wallets rather than following the standard security principles which are written in Ledger’s Bounty program.

Kuwait’s National Bank Introduces RippleNet-Based Remittance Product

The National Bank of Kuwait (NBK) has launched a remittance product based on RippleNet’s blockchain technology with the goal of pursuing faster and more efficient cross-border transactions.

NBK has now joined the growing number of financial institutions worldwide to have partnered with Ripple for its blockchain-based payments services. Amongst these include Malaysian banking group CIMB, South Korea’s crypto exchange Coinone, U.S. banking giant PNC, remittance firm UAE Exchange.

The NBK was established in 1952 and it is the largest financial institution in terms of assets in Kuwait, having over $86.3 billion in total assets as of 2017 and it has become the first financial institution in Kuwait to implement a remittance product which will be named “NBK Direct Remit”. The product will allow customers to make instant blockchain-based payments using Ripple’s blockchain technology and at “anytime of the day,” according to the deputy CEO of Group Operations and Technology Dimitrios Kokosioulis. The product will apparently speed up cross-border money transfers.

In addition to that, the service is launching with a remittance corridor to Jordan only, however it is expected to expand to more countries in the future, according to a statement made by the bank. NBK has branches in China, Geneva, London, Paris, New York and Singapore, and regionally in Lebanon, Jordan, Egypt, Bahrain, Saudi Arabia, Iraq, Turkey and UAE.

The bank will be charging a fee of 1 Kuwaiti dinars ($3.29) per transaction for Jordan transfers if funds are sent to its local branch. For customers using other banks, it will charge 5 KWD ($16.47) per transaction. The default limit for transactions is capped at 2,000 KWD ($6,586).

Marcus Treacher, Senior Vice-President of Customer Success at Ripple stated that his company has already started moving live payments across its blockchain network on behalf of NBK customers.

In November, Malaysian lending giant CIMB Group Holdings Bhd joined RippleNet. CIMB will utiliye and implement Ripple’s XCurrent product, which is a software solution for expediting cross-border payments, for its “SpeedSend” remittance product.

At the same time, Japanese bank and financial services firm Mitsubishi UFJ Financial Group, Inc. disclosed that it will use Ripple’s blockchain technology to develop a new cross-border payments service to Brazil through a partnership with Banco Bradesco. The new product aims to “assist the banks as they work toward commercializing a high-speed, transparent and traceable cross-border payments solution between Japan and Brazil.”

According to the latest data, the remittance market is a growing industry across the globe, especially in the Middle East. The World Bank reported that migrants exchanged $53 billion in 2017 alone to the Middle East and North Africa markets.

South Korean Court Rules in Favour of Crypto Exchange Bithumb

South Korean court ruled in favour of crypto exchange Bithumb after an investor had sued the company for his loss of around $355,000, claiming to have been a victim of a hack. Local news reported on the outcome of the case as soon as the court revealed details of the case files.

According to the new, the investor — 30 year old civil servant Ahn Park, claimed to have been the victim of a hack of his Bithumb account on Nov. 30, 2017, which resulted in a loss of 400 million Korean won ($355,000).

Apparently, within hours of making his deposit, someone had logged into Mr. Park’s account and exchanged the fiat for Ethereum (ETH). That same day, Mr. Park further insisted that Bithumb allowed the ether to be transacted out of his wallet four times, leaving the owner’s account with merely cryptos worth 121 won (11 U.S. cents) and less than a dollar in cash.

Allegations Rebuffed

In an attempt to reclaim his funds, Park took Bithumb’s parent firm – BTCKorea.com, to a civil court citing the company’s failure to offer security safeguards that are adequate to its responsibilities as a “financial services” company. Park Ahn indicated as well to a major breach of personal information that had occurred in Bithumb in April 2017 as a possible leak of his account details, and argued that the exchange platform did not perform its duties to act in the best interests of customers. In the 2017 breach, over 30,000 of Bithumb users had their personal data stolen after a malicious code was placed on the platform. As a result, the company received penalties worth of 58 million won from authorities.

Respectively, the judge overseeing the case denoted that it can’t be determined that Park lost his personal data in the April 2017 data breach and suggested that he might have lost his Bithumb login details via a phishing website, or his cellphone might have been hacked.

Additionally, Park’s claim that the exchange had not lived up to its fiduciary duty had been rebuffed by the court as Bithumb had in fact sent 10 SMS messages to Park to alert him about the withdrawals, which must be manually approved by the exchange.

In a last attempt, Park argued that Bithumb’s activities as a crypto exchange are similar to services offered in the financial sector, and therefore should fall under the security requirements that apply to electronic commerce transaction brokers.

However, the judge ultimately ruled in favour of Bithumb, agreeing that the Electronic Financial Transactions Act does not apply to the exchange, denoting that cryptocurrency is “mainly used as speculative means, so it cannot be regarded as an electronic means of payment.”

Japan’s GMO Decides to Abandon Crypto Mining Sector

In most recent news, internet giant GMO Internet Group is admittedly leaving the Bitcoin mining hardware sector.

The company, which began its attempt in Bitcoin mining back in 2017, disclosed that given the current “increasingly competitive” business environment and weak crypto market, it will no longer develop, manufacture, and sell mining machines, citing “extraordinary loss” in fourth quarter of this year as cause for its ultimate decision.

 “After taking into consideration changes in the current business environment, the Company expects that it is difficult to recover the carrying amounts of the in-house-mining-related business assets, and therefore, it has been decided to record an extraordinary loss.”

GMO’s consolidated losses for the fourth quarter reached 35.5 billion yen ($320 million), whilst the unconsolidated loss tally added up to around 38 billion yen ($334.5 million). Despite that, the company claimed that the losses had not impacted its financial integrity.

Au contraire, in November, the company had reported historical performance of its cryptocurrency projects within third quarter, which involved mining hardware sales. At that time, profits amounted to 2.6 billion yen ($22.8 million).

GMO launched its mining hardware business in September 2017 and set up its in-house mining operations in northern Europe at the end of last year. The decision to quit its miner making business comes just months after GMO formally launched its B3 miner equipped with a 7nm mining chip.

Mining Operations Will Continue

This marks GMO as the latest victim of the 2018 Bitcoin (BTC) declining market as falling prices undermined mining profitability.

However, the GMO group announced on Tuesday that despite the current circumstances it will continue to run its in-house mining operations and is planning to review its revenue structure and relocate its mining center to a new region with cleaner and less expensive power resources.

In a conference call with institutional investors on Tuesday, the company further explained that “we are currently operating mining machines, and the depreciation cost will be almost zero after recognizing the impairment loss. Therefore, we will continue running mining operations if we can ensure that the revenue exceeds the electricity cost.

As of now, GMO has yet to decide the full details of its new plans and whether it will help improve its profitability.

In regards to GMO group’s other business branches, including its crypto exchange business, the company stated that it believes they have high growth potential and will continue to position them as growing sectors for its future growth strategy.

Bitmain’s Woes Continue as the Firm Plans Layoffs

In most recent news, sources from Chinese media has reported that Bitmain – a global cryptocurrency mining giant, has gone on a layoff spree and intends to lay off almost half of its staff by the end of the week.

According to the reports, Bitmain has laid off today a whole team, which had been working on the development and improvement of Bitcoin Cash client. Reportedly, the news broke out to the wire when Samson Mow, Blockstream Chief Strategy Officer and former BTCC Chief Operational Officer, tweeted about it, citing that:

“Bitmain has quietly laid off their entire Copernicus team. Only 1-week notice. Some had just joined the company. Layoffs just in time for Christmas.”

Following this, rumors started to spread at an exponential speed, gaining more credibility as people, who claimed to be ex-employees of Bitmain, started sharing their exit stories on LinkedIn. Additionally, Sanyan Finance – a Chinese media outlet, has also contacted Bitmain employees for further confirmation. Whilst they confirmed that the HR division at Bitmain has been indeed in talks with employees about “something”, they neither confirmed nor denied whether employees are in the process of a layoff.

Bitmain Trimming its Activity

However, even before the layoff rumor spread, the company had already halted its activities in the State of Israel. According to local news, Bitmaintech Israel, which had been founded just two years ago, fired its entire team, including vice president Gadi Glikberg, citing losses incurred during the latest crypto crash.

In November, the cryptocurrency market cap lost $70 billion worth of investments after Bitcoin Cash (BCH) fork jeopardized the stability of the entire crypto industry. Bitmain, who at that time showed support to one of the Bitcoin Cash camps, led by Roger Ver in its quest to attain lead over the other, had suffered losses worth millions of dollars in the aftermath.

Subsequently, the crypto market crash forced Bitmain to reexamine its activities across the globe and proceed according to the current circumstances.

The crypto mining giant had almost 2,000 employees working across its mining and blockchain development divisions. Although it is currently not known whether or not it is a global layoff, Beijing layoffs are already active, as reported by 36kr. It is expected to drop to 300 by the time the reported layoff concludes.