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Blockchain Voting Systems Are Untrustworthy, MIT Cybersecurity Experts Say

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Amidst the ongoing discussions of the results of the presidential election, a group of researchers has come up to disapprove of blockchain voting as an alternative for trusted democratic elections.

Massachusetts Institute of Technology’s Computer Science and Artificial Intelligence Laboratory (MIT) researchers published a report on November 16 cautioning against reliance on blockchain voting technology as a way of promoting greater turnout in an election. According to them, using the system would not improve the integrity of voting but instead increase the risk of hackers tampering with the way elections are carried out.

Sunoo Park, Neha Narula, Ronald L. Rivest and Michael Specter, the institution’s cybersecurity team, asserted that it is highly unlikely that political elections would rely on blockchain for the foreseeable future. According to them, voting in person, mail-in ballots, and other software-independent methods are more reliable and, therefore, would stay for a long time. Potential lack of ballot secrecy – due to blockchain’s traceable nature – and inability to audit in case the race is contested are some of the concerns the researchers emphasized.

Researchers Suggest that Blockchain Can Compromise Elections

Rivest, an MIT professor, who was the report’s senior author, explained that the risk of nation-scale election failures being undetectable would greatly increase with blockchain replacing the current election systems. Meaningful assurance that votes were counted at the time they were cast would dwindle with the increase in turnout.

“I haven’t yet seen a blockchain system that I would trust with a county-fair jellybean count, much less a presidential election,” the researcher continued to distrust blockchain voting.

The use of blockchain technology in a democratic voting process differs from the use in financial transactions in that financial institutions usually compensate victims using various ways in the latter when losses occur due to fraud or hacks. If they are crypto exchanges, tokens would be frozen, and if they are credit card companies, funds would be reimbursed after the hack, according to the teams’ argument. Once an election is compromised due to the failure of democracy, there is no reassurance that voters will be made whole again.

The MIT team also explained that blockchain-based voting is vulnerable to “serious failures.” Physical access is necessary for one to destroy a mail-in ballot, but hackers can just use a single point of attack to remove or alter millions of votes with a blockchain-based voting system. Therefore, authorities would be forced to hold an entirely new election if the results are unreliable when hackers attack votes.

Blockchain Voting Was Deployed despite Its Vulnerability

A couple of countries are trying to integrate blockchain technology into their voting process bring about various challenges. For instance, users and third parties were able to decipher votes during Vladimir Putin’s term limit before the official count started in Russia’s blockchain-based voting system, thereby compromising ballot secrecy.

Researcher Michael Specter, in a different MIT team, in February, found out that Voatz, a blockchain-based voting app, had various security vulnerabilities. In spite of that, the Republican and Democratic parties went ahead to use the app for voting at their conventions this year.

Rivest supported the deployment emphasizing:

“Democracy – and the consent of the governed – cannot be made contingent on whether some software correctly recorded voters’ choices.”

Due to social isolation caused by the pandemic, many American voters chose to vote by mail. As a result, intense debates have been triggered concerning the current American electoral system’s legitimacy and veracity. Some are proposing a proposed “mobile” voting based on blockchain as a way to ease elections. 

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James Lovett is a talented crypto enthusiast who finds pleasure in sharing more knowledge on fintech, cryptocurrency as well as blockchain and frontier technologies. He likes to keep himself furnished and updated with the latest innovation in the crypto industry, blockchain technology, Internet of Things (IoT) and other technologies. As a result, he tries to furnish ardent crypto supporters with the latest news on blockchain and distributed-ledger technologies. Indeed, Blockchain and Cryptocurrency is changing the world as we know “one block at a time”. As a hobby, he also trades in small amounts of cryptos every now and then.
An author with experience writing for tech, digital, and cryptocurrency blogs!



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Whales Movement of BTC to Exchanges May Be Reason for It

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Bitcoin was nearly hitting a new all-time high earlier this week after it rose $19,469 for the first time since December 2017. However, today, it lost around 11% of its value.

Analysts’ expectations come true as BTC fails to overcome the $20,000 all-time highs. After Bitcoin price rose to a high of $19,580, it experienced a sudden drop to $17,250.

According to Cointelegraph Markets and TradingView data on Wednesday, BTC/USD experienced major volatility overnight, causing it to lose nearly $2,000 in just a matter of few hours. During the day’s trading, BTC hit highs of $19,500, but bearish indecision in the after-hours led to a sharp sell-off making it to fall to around $17,000. It later bounced to $17,250 to cap its daily losses. At the time of writing, BTC is trading at $17,057, which means that it has lost 11.23% in 24 hours.

Trader Tone Vays and CNBC host Brian Kelly are some of the analysts who had earlier warned that it was a pullback that led to the recent gains. According to their Thursday forecast, BTC might even dip to as low as $14,000. Popular Crypto Fear and Greed Index, amongst other several metrics, also joined the criticism suggesting that the popular crypto coin, which has enjoyed record-high levels throughout November, would soon experience a correction.

Bitcoin Price Drop Happened Due to Exchange Selling Pressure

Large-volume investors’ deposits of BTC to exchanges is thought to be the reason for the sudden price drop. Whales were trying to take profit near Bitcoin’s $20,000 all-time highs. They are known to buy or sell digital assets in high volumes.

On-chain analytics resource CryptoQuant, creator Ki-Young Ju, explained the scenario to various Twitter followers.

As per some analysts, a 7.3% uptick in mining difficulty expected in three days’ time and a continuously growing hash rate would make the market to be more bullish. At the time of writing, BTC was hovering around the $16,800-17,300 region.

Factors Preventing BTC from Crossing $20K Hurdle

BTC was nearly hitting a new all-time high earlier this week after it rose $19,469 for the first time since December 2017. However, even after attaining such a peak, a couple of significant factors prevented it from surpassing its record high.

First, a possible bull trap scenario was looming. ‘Bitcoin Jack’ – known for coming up with the phrase ‘Bitcoin bottom in March’ – coined the term ‘potential bull trap scenario’ to describe a point wherein long holders or late buyers become trapped owing to a digital asset price drop. Bitcoin Jack’s projected a price trend where a potential pullback would occur in the event that Bitcoin rejects the $19,200 to $19,300 area.

Second, Bitcoin would enter price discovery mode when it crosses $20,000, thereby searching for a new ceiling since there is a lack of evidence or historical data beyond that point. Many analysts and industry have predicted that BTC would, thereafter, settle anywhere between the $25,000 to $100,000 price range if that were to occur. Therefore, sellers are aggressively defending their interests by making BTC not to go past $20,000.

Thirdly, extremely high funding rates compel sellers to trade below $20,000. Bitcoin perpetual swap contract funding rates have been ranging from 0.05% to 0.1% across various major cryptocurrency exchanges. Meaning, a large part of short-sellers positions as fees is catered for by long contract holders or buyers. With the highly positive funding rates, short-sellers are compelled to hold the market below the $20,000 region aggressively.

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OKEx Resumes Withdrawal Services After 5 Weeks of Suspension

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Five weeks ago, OKEx suspended all account withdrawals after one of the key holders was detained by the police to assist in the investigation.

After holding customers’ funds for over a month, Malta-based cryptocurrency exchange OKEx has resumed normal services at 8.00 (UTC) on November 26. However, despite all the promised user loyalty reward campaigns, nothing stopped its customers from mass migrating to reliable exchanges.

OKEx Case and Suspension of Withdrawal Service

Five weeks ago, OKEx suspended all account withdrawals after one of the key holders was detained by the police to assist in the investigation. The prior unknown key holder has been identified as the founder of OKCoin and CEO of OK Group Mingxing “Star” Xu.

Prior to Thursday’s resumption of trading services, the exchange tested its withdrawal services on Wednesday, 0.02 BTC was moved out from an OKEx wallet.

The huge relief to OKEx customers has prompted them to undertake precautionary measures to keep their funds safe. Apparently, a huge portion of Bitcoins stored in the OKEx wallet have been observed to have been moved to other exchanges including Binance. According to on-chain analyst, Mason Jang, 54 OKEx accounts have withdrawn their funds and 2,822 BTC have been recorded on the outflows. Whereby 446 BTC have been moved to Binance.

Further analysis by CryptoQuant reveals that outflow recorded is the year-high in the block time frame. OKEx had a bitcoin reserve of 101,686 but has dropped to 98,821 BTC.

In addition to bitcoin withdrawal, Whale Alert spotted a transfer of 198,467 OKB worth approximately 1,033,580 from OKEx to FXT.

As news of withdrawal resumption spread amongst the crypto community, more withdrawals are expected to continue.

Notable Market Effect

The resumption of services at OKEx has coincided with increased crypto volatility that has seen Bitcoin drop a significant portion in a single day. Notably, the global crypto market cap has dropped by approximately 11.8% in the past 24 hours to around $515 billion.

Almost all digital assets have dropped with a double-digit figure in the last 24 hours, indicating increased activity in the whole ecosystem.

According to the metrics provided by CoinGecko, Bitcoin has dropped by approximately 10% in the past 24 hours. ETH, XRP, BCH and LTC have all dropped by 12.7%, 21.4%, 18.4% and 15.1% respectively.

However, at the time of writing the shedding had been somehow contained with most of them up by approximately 3%.

Bitcoin is trading around $17,339.10, Ethereum at $522.2, XRP at $0.543099, Bitcoin Cash at $279.38 and Litecoin at $75.27.

Although a huge relief to OKEx customers, it is a major lesson to all cryptocurrency investors that if you do not control and protect the private keys, then your assets are at risk of being stolen anytime.

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A financial analyst who sees positive income in both directions of the market (bulls & bears). Bitcoin is my crypto safe haven, free from government conspiracies.
Mythology is my mystery!
“You cannot enslave a mind that knows itself. That values itself. That understands itself.”



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BTC Will Not Correct Forever

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On Thursday, November 26th, the BTC is correcting after its rally reached a peak this week. It is generally trading at 16,733 USD with a high of 19,490 USD.

By Dmitriy Gurkovskiy, Chief Analyst at RoboForex.

  • Tech analysis of BTC/USD.
  • MicroStrategy earned 350 million USD on the BTC.
  • WSJ made a publication with the BTC on the front page.

On W1, the BTC is correcting from 100.0% Fibo. The aim of the pullback is currently 13,207 USD. The MACD histogram remains positive, providing another signal for the price growth. The signal lines of the indicator are forming a Black Cross, increasing the chances for the ascending dynamics. The Stochastic is heading for the overbought area, suggesting a major correction in the nearest future. Judging by all the factors, the crypto asset is likely to correct and go on with the growth then.

Photo: RoboForex / TradingView

On D1, the tech picture is almost identical to that on W1: the pair keeps correcting. The aim of the decline is the support line of the ascending channel. The MACD histogram is above zero, which promises further growth. The signal lines of the indicator keep growing upon forming a Black Cross, supporting the growth. The indications that the two charts look similar: a correction before the development of the uptrend looks preferable. The aim of the growth after the correction is 19,415 USD.

Photo: RoboForex / TradingView

On H4, the perspectives of further growth after a correction are also bright. The Stochastic remains in the overbought area, supporting a correction before further growth. The aim of the pullback might be on the support line of 16,200 USD. The aim of the growth after the correction is the same as on the longer timeframes – 19,415 USD.

Photo: RoboForex / TradingView

In August-September, MicroStrategy invested 425 million USD in the BTC, and by this week, the investment has increased by 305 million USD. The company guessed it well with the investment: its own net profit of the last 3.5 years amounted to just 78 million USD.

Not only MicroStrategy made a profit on the crypto rally. At the beginning of October, Square bought 4,709 BTC, and by now, the investment has grown from 50 million to 90 million USD.

Clearly, the whole issue could have turned out the other way round, but this time risky investors are fortunate.

The BTC is the hero of the week (the last eight weeks, to be precise), but it is now that its growth attracted maximum attention. On November 23rd, the Wall Street Journal published an article about the leading cryptocurrency on the front page. In the article, it is noted that this year the BTC has found billions of fans and has got noted by institutional investors, which makes its rally so stable.

Neither can we disregard the turmoil going on in the world of fiat money, which pushed investors to find alternatives. This also supports the crypto market.

For this article, we’ve used BTCUSD charts by TradingView.

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Disclaimer: Any predictions contained herein are based on the author’s particular opinion. This analysis shall not be treated as trading advice. RoboForex shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.

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Kseniia Klichova
Author: Dmitriy Gurkovskiy

Dmitriy Gurkovskiy is a senior analyst at RoboForex, an award-winning European online foreign exchange forex broker.



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