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Iranian Students Turn To Crypto

The tension between the United States and Iran is nothing new. In 2002, the president at the time, George H.W. Bush, famously referred to Iran as part of the “Axis Of Evil”, a term used to describe a group of foreign governments that seek weapons of mass destruction and sponsor terrorism.

President Donald Trump

However, thanks to the sanctions that Trump recently imposed in November, there is a new unintended victim involved thanks to the disagreements between the two countries: students.

Tuition In Cash?

Thanks to the ban on money transfers, Iranian students are now struggling to pay their tuition fees. In one particular example, 23 year-old law student Parsa Sadat actually has the money to pay for the tuition, but is essentially being told to fly back to Iran and retrieve the money in cash, which is both costly and obviously inconvenient.

University of Reading, UK

An associate professor at University of Reading, in the U.K., where Sadat studies, commented on the situation, stating: “Even if the funds for the flight and fees can be raised, requiring Parsa to transport large amounts of cash within and from a country classified by the Foreign Office as a high-risk country, exposes the university to justifiable criticism,” said Mai Sato, an Associate Professor at Reading. “Parsa himself feels that carrying several thousand pounds in cash is dangerous.”

Crypto Solution

It’s easy to see how cryptocurrency and its decentralized nature can come into play here, since it is not subject to a specific authority or government.

Maziar Bahari, the editor of a website called IranWire.com, pointed out that many students were turning to cryptocurrency, which can easily be transferred across borders quickly and efficiently. He stated, “They are using Bitcoin and other cryptocurrencies in order to get money.”

The University of Reading seemed to understand the inconvenience of the situation, and offered this statement: “We recognise that this student is facing exceptional circumstances and are monitoring the situation. We are working with him to try to resolve this issue.”

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Cryptocurrency Platform Cubits Files For Administration

It has been a tough time for cryptocurrency startups and companies, given the fact that 2018 has been a brutally bearish in terms of price action.

Bitmain recently closed down its operations in Israel, and Joseph Lubin (a co-founder of Ethereum) has admitted that the bear market has affected his Brooklyn blockchain startup Consensys. It appears as though the U.K. cryptocurrency platform Cubits is also closing down.

Fraudsters pilfer Cubits

Cubits is not closing down as a result of the markets, but because it apparently has lost funds to the tune of 29 million British pounds ($32 million USD) to “fraudsters”. The money does not seem to be able to be reclaimed, and as a result, the company has filed for administration. This means that the company has become insolvent, and appointed an external administrator “to work with those who are owed money by the company and collect monies owed.”

There were some in the cryptocurrency community that believed that the company was actually trying to pull off an exit scam, pointing out that the company was not responding to e-mails or inquiries regarding its service.

Steve Parker is one of the new administrators involved, and stated: “Our goal is to achieve the best outcome for creditors generally at the earliest possible date. Dooga’s position is secure, investigations are proceeding, and we will be writing to creditors, formally, this week.” For clarification, Cubits operates under the legal entity name “Dooga”, which was formed in London in 2014.

Crypto Twitter Updates

Cubits had simply stated on Twitter on December 10 that their “services were unavailable” and “We’ll be right back!” However, many frustrated users responded to the tweet, claiming that they had been trying to withdraw their funds for some time.

The Cubits Twitter account, @CubitsHQ, has now pinned a tweet explaining that the company has filed for administration:

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FATF Encourages More Cryptocurrency Monitoring

The Financial Action Task Force (FATF) has stated that the country needs to do more with regards to monitoring cryptocurrency. The report released from the task force essentially states that the country isn’t doing enough with regards to ensuring that cryptocurrency is used as conduit for terrorist financing and money laundering. For those who are unaware, the FATF is an organization formed by the G7 in order to address international money laundering.

Report Details

The report claims specifically that the UK faces severe threats from international terrorism, and that “virtual currency providers are not yet covered by AML/CFT requirements.”

The report elaborates: “The UK acknowledges the inherent vulnerabilities associated with the anonymity of VCs [virtual currencies], and while the risk of ML/TF in this area is assessed as low, the UK acknowledges that there are intelligence gaps and VCs are being used in illicit activity (particularly in online marketplaces for the sale and purchase of illicit goods and services).

It continues: “As a result, the UK intends to regulate virtual currency exchange providers under its implementation of the EU’s fifth Anti-Money Laundering Directive.”

Conclusions

The report actually praises the UK in terms of how it deals with financial crime. It states that the U.K. has a “robust understanding” of monitoring and preventative measures with regards to the issue, and noted the fact that it conducted thousands of investigations last year, which resulted in 1400 convictions.

The report does seem to imply that the cryptocurrency sector could be a weakness for criminals to exploit. However, it recognizes that as of right now, the issue is not a central threat to the country. Specifically, the report states: “This is an emerging risk and there is not yet evidence to suggest that broad scale ML/TF is occurring in the UK through this relatively small sector.

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Financial Conduct Authority Issues warning on “clone” companies in the UK

The United Kingdom financial regulator FCA has issued a warning to investors about clone firms of that operate under the guise they are registered by the FCA, and use a name similar to that of a legitimate firm such as investment firm Fair Oaks Capital Ltd.

FINANCIAL SERVICES IN THE U.K MUST BE AUTHORIZED

The FCA registers all financial firms providing services to consumers in the UK. The FCA issued a statement where it outlined a company that was targeting citizens in the UK using the data of firms authorized by the regulator. Fair Oaks Crypto targets victims by falsely claiming to represent Fair Oaks Capital, which happens to be a financial firm registered with the FCA.

The FCA has provided the details of the clone firm to the public to raise awareness and avoid such frauds. The regulatory authority also informed the public and investors that they should regularly check the Financial Services Register before transacting with any firm.

POSITIVE REGULATORY APPROACH

The FCA has taken a positive regulatory approach towards cryptocurrencies. It recently announced the creation of a global initiative called Global Financial Innovation Network (GFIN). The aim of GFIN is enhance collaboration between regulators and companies. GFIN will also consult of some topics such as Initial Coin Offerings (ICO).

The FCA recently launched a crypto task force in collaboration with the Bank of England.  The main objective of the task force is to look at ways in which cryptocurrencies can be regulated and explored.

UK TO BECOME A LEADER IN THE CRYPTO SPACE

Deep Knowledge Analytics and Big Innovation Centre last month released a report which showed that the UK had the resources of becoming a major leader in the crypto space in the next few years. The chief executive of DAG Global, Sean Kiernan believes the UK is strongly positioned to lead in the blockchain and cryptocurrency space:

“The UK is a major global financial hub and in recent years has become a fintech leader as well. At the same time, it is starting to demonstrate significant potential to become a leader in blockchain technologies and the crypto economy,”

The study further explored the development of blockchain technology in the country and found it to be in its earlier stages.

Remember folks, Crypto is comin!

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