Crypto’s Too Expensive? Binance Sent $600 Million in Bitcoin for Just $7

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Crypto exchange Binance has been moving bitcoin funds to cold storage the past couple of days, and, of course, such large transfers don’t go unnoticed.

Two transactions destined for Binance’s cold wallet come to the fore and demonstrate both the power and irony of the blockchain. A transaction in block 550211 was a transfer of just over $1 million. For this transaction, Binance paid just over $8 in fees. The “high” amount of the fee is probably a matter of convenience, as the transaction was not particularly large at just 1550 bytes.

The other transaction, first flagged by Antoine Le Calvez of CoinMetrics.io,  is more notable for its size — $600 million at the time it was sent, making it the largest unspent transaction output existing today — but also illustrates the irony of Bitcoin transactions, whose fees are not based on the amount transacted but instead the amount of computer resources required to store the information. This second transaction, made in block 550155 several hours earlier, comprised 5981 bytes yet cost the giant exchange just over $7.

Source: blockchain.com

Other factors, such as network activity, apply to transaction fee calculations.

Contrast With Traditional Transaction Movement

It should first be noted that there is no banking product with the same security as a cold storage wallet. A cold storage wallet is one that is not connected to the blockchain via the internet. With appropriate security hygiene, it can amount to having direct access to your personal fortune with no middlemen.

It would take days or weeks to find out the cost of moving funds between bank accounts from various banks, and banks are in particular not the best thing to compare Bitcoin with, it being primarily a remittance tool. Nonetheless, it is known that interbank fees generally run in the neighborhood of 4 percent or more, supposing the funds were being moved internationally. Domestically there would still be fees, which would depend very much on the bank being used.

Banks using Ripple‘s enterprise DLT products and other blockchain technologies might be able to reduce the cost significantly. Likewise, one-time deposits and other deals can be made with banks when moving this amount of funds. But this is cold storage, after all – funds that Binance will later probably need access to. The notion of paying any more than necessary fees for access or movement, and being reliant on external forces, is antithetical to the business of being a cryptocurrency exchange.

Which is to say, Binance is engaging in money transfers that wouldn’t have been possible in a previous era in order to facilitate a business model that wouldn’t have been possible in a previous era, all at a cost that would have been unimaginably low in a previous era.

We find it helpful to compare the cost of these transactions with a service like PayPal instead. While it’s unlikely that Binance would work with PayPal or that PayPal would work with transactions of this size, it’s useful to compare the value of Bitcoin to other remittance models. According to Salescalc.com, which specializes in such data, a fee of $17,400,000.30 would be incurred moving $600M to the PayPal account of the “cold storage steward” in the theoretical case of a PayPal model. PayPal does not charge fees for moving funds to bank accounts, but there is an associated delay when using traditional banking models.

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$50 Million ICO Lands Crypto Lender SALT in Hot Water with SEC: WSJ

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SALT Lending, a cryptocurrency loan provider who raised tens of millions of dollars during through an initial coin offering (ICO) with support from crypto pioneer Erik Voorhees, has become the latest blockchain firm to attract the attention of US securities regulators.

Crypto Loan Provider SALT under SEC Investigation

The Wall Street Journal reports that the Securities and Exchange Commission (SEC) in February sent a subpoena to SALT seeking its information about its $50 million token sale, which was conducted last year amid the ICO boom.

Unnamed sources cited in the report said that the SEC was evaluating whether the SALT ICO constituted an unregistered securities offering, as well as how the firm used the token sale proceeds and distributed SALT tokens to contributors.

salt ico crypto token loanSALT/USD | CoinMarketCap

The Denver, CO-based company confirmed to the WSJ had been subpoenaed, noting that it occurred around the time that the SEC’s enforcement division opened investigations into “dozens” of crypto startups who had raised funds through ICOs that the agency believes may have been illegal securities offerings.

That’s not the full extent of SALT’s problems, though, as the report also states that a former SALT financial officer has filed a lawsuit against the firm, claiming that the company lost $4 million in cryptocurrency following a hack in February and also gave favorable loan terms to company executives and their family members.

Crypto Pioneer Erik Voorhees Scrutinized for Connection with SALT

erik voorhees shapeshift bitcoin cryptoErik Voorhees | Source: Token Summit/YouTube

According to the WSJ, the SEC is also investigating whether crypto pioneer Erik Voorhees — a former SALT adviser and board member — violated a 2014 SEC settlement that barred him from participating “in any issuance of any security in an unregistered transaction in exchange for any virtual currency including Bitcoin for a period of five years.”

That settlement stemmed in part from charges related to his operation of bitcoin gambling site SatoshiDICE, which was one of the earliest and most successful crypto-native services. The SEC charged Voorhees with conducting an unregistered securities offering after he allowed investors to use bitcoins purchase shares in SatoshiDICE and another company.

In September, another Voorhees project — ShapeShift, which until recently, helped users trade cryptocurrencies without accounts or identity verification — abruptly began forcing users to register with the company and submit to Know-Your-Customer (KYC) policies in line with those adopted by most conventional crypto exchanges and trading services. While the company has never outright admitted that it made this stark reversal under pressure from regulators, Voorhees’ statements suggest that this was the case. “What I write is being watched very closely. Please give us time,” he said on Twitter when one disgruntled follower asked him to explain why forcing KYC was the right decision.

SALT executive Jennifer Nealson told the WSJ that Voorhees was an “early contributor” to the firm but “no longer serves in any formal capacity.”

Notably, though, Voorhees was listed as a co-inventor on a SALT patent application filed with the US Patent & Trademark Office (USPTO) as recently as Jan. 30, about the time that SALT reportedly became aware of the SEC’s investigation.

erik voorhees salt lending crypto patentSource: USPTO

A SALT spokesperson did not immediately respond to inquiries on the nature of Voorhees’ departure and whether it was related to the SEC investigation.

Commenting on the report, Brian Klein, Voorhees’ lawyer, called the WSJ’s inclusion of his client in its article an “unfair attack.”

“I am proud to represent @ErikVoorhees, a real visionary, who has abided by his SEC settlement terms. This @WSJ story is an unfair attack on him relying on unsubstantiated allegations, anonymous sources, and he is not even a party to the lawsuit discussed,” Klein wrote on Twitter.

In any case, the subpoena does not appear to have led SALT to hit the brakes on its expansion plans, as the firm has continued to open its services to new jurisdictions and add more cryptocurrency collateral options to its platform in the months following the start of the SEC’s investigation.

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BuckyCoin Launches First Ever Cryptocurrency Backed by Decentralized Content Distribution Network & Own Content

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This is a paid-for submitted press release. CCN does not endorse, nor is responsible for any material included below and isn’t responsible for any damages or losses connected with any products or services mentioned in the press release. CCN urges readers to conduct their own research with due diligence into the company, product or service mentioned in the press release.

As many ICO’s come and go, it is refreshing to come across an ICO that has actual value in real life. BuckyCoin, which is backed by powerhouses in the entertainment industry, has successfully acquired many catalogs of eBooks, Movies, Music, Animation and more. The acquisition has put BuckyCoin on the map as the first truly Decentralized Content Distribution Network.

Victoria, Seychelles – Nov 9th, 2018, Bucky Coin has made international headlines with the announcement that they have acquired the rights and ownership to over 2,500 movies, books, Music and other scripts. This comes as welcoming news for participants in the Bucky Coin ICO as it enters into the final round on December 1st, 2018. Unlike other ICO’s built on a dream, Bucky Coin is backed by real assets that stand to bring in desirable profits for all token-holders. Bucky Coin is the world’s first decentralized content distribution network that aims to connect all content creators with advertisers.

Bucky Coin provides a decentralized blockchain platform to integrate content owners, individuals, celebs, models, advertisers, animation and application developers in entertainment and media content distribution. The Bucky Platform, built on the blockchain, allows users to retain control of their own content while allowing advertisers to advertise within the content. The days of needing a Hollywood style distribution deal may be over with the introduction of the Bucky Coin.

Bucky Coin ERC-20 token is audited and certified that it is adhering the standard compliances. This document is available for viewing at https://buckycoin.io/wp-content/uploads/2018/10/bucky_coin_audit.pdf

During a recent press conference, the company spokesperson for Bucky Coin was quoted as saying, “We recently acquired the rights to over 2,500 popular media productions and started releasing all of that content into the Bucky Platform. Our ICO participants stand to make a great ROI not just from the tokens’ value, but also from advertising profits from all of the screenplays we have acquired.” He went on to say, “Bucky Coin is the first peer to peer decentralized content marketplace for advertisers. The way Hollywood works has changed with the introduction of the Bucky Coin and we couldn’t be happier!”

This highly anticipated ICO is in Phase 2 and plans to close on Nov. 30th, 2018. Currently, each Bucky Coin token only costs $0.20 per token, which is considered a great sale price by analysts. Interested participants should act with urgency as the price per token will go up to $0.25-$0.55 during the ICO’s final phase. ICO’s that have ownership of real assets tend to sell out fast, it is recommended to purchase now while the ICO is still in phase 2. Bucky Coin already has a large social media following and subscribers based on various netizen avenues such as Facebook, Twitter, Google+ and YouTube.

To learn more about the opportunity to participate in the Bucky Coin ICO, visit their official website at http://www.buckycoin.io

Media Contact:

Bucky House
Attn: Media Relations
Victoria, Seychelles
[email protected]