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A researcher at the MIT Digital Currency Initiative discovered that Bitcoin Gold was 51 percent attacked on January 23. Yet, in the last 24 hours, the cryptocurrency has increased by 19 percent in price.

In a report published on code repository GitHub, MIT DCI research assistant James Lovejoy said two seperate attacks were carried out on Bitcoin Gold blocks within a span two days.

A 51 percent attack is quite possibly the most serious form of attack against a cryptocurrency.

When carried out successfully, it allows attackers to re-organize blocks and change data within a blockchain.

Since the main characteristic of a public blockchain network that makes it better than centralized alternatives is immutability, a 51 percent attack can cause dire consequences for a cryptocurrency.

It is not cheap or easy to carry out a 51 percent attack, however. The attack itself requires majority control over a blockchain networks hashpower.

For a major cryptocurrency like bitcoin, Ethereum, and others, its practically impossible to carry out a 51 percent attack. One could possibly carry out an attack, but there would not be any incentive to do so and the attacker would end up losing money.

In the case of Bitcoin Gold, Lovejoy said that the orders of tens of blocks on the cryptocurrency are not enough to eliminate the incentive of launching a 51 percent attack against it.

The report read:

Based on Nicehash market price data for Zhash we estimate the cost of generating each reorg at around 0.2 BTC (~$1,700) and the attacker would have recouped around the same value in block rewards. Therefore, it is possible that the attacks were profitable if the double-spends succeeded at defrauding the attackers counterparty, or break-even if the double-spends were unsuccessful. This suggests that a confirmation requirement on the order of tens of blocks for BTG is still far too few to make the budget constraint to launch an attack significant.

As emphasized by Lovejoy, this is not the first time Bitcoin Gold fell victim to a 51 percent attack. In May 2018, it experienced a similar attack and reports indicated about $18 million were affected.

Despite the serious attack on the cryptocurrency, the price of Bitcoin Gold is up 19 percent on the day.

Bitcoin Gold cryptocurrency is up 19 percent on the day (source: TradingView)

Throughout the past two weeks, the cryptocurrency market have seen bitcoin offshoots like Bitcoin Gold, Bitcoin SV, and Bitcoin Cash surge in tandem.

The abrupt upsurge of Bitcoin Gold following such a high profile attack against the underlying public blockchain network raises the question on the fundamentals of the cryptocurrency exchange market.

It is often difficult to assess or evaluate the structure of the cryptocurrency exchange market because of the abundance of fake or inflated volumes across many top exchanges.

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This Top Cryptocurrency Got 51% Attacked. Yet, Its Up 19% And Its a Problem - newsBTC

If you were hoping to keep your bitcoin stash under wraps from the IRS, think again.

As the 2019 tax season kicks off on Jan. 27, the taxman is expecting you to disclose whether you had any cryptocurrency transactions last year.

The IRS asks the following question on the first page of Schedule 1 of the individual income tax return: "At any time during 2019, did you receive, sell, send, exchange or otherwise acquire any financial interest in any virtual currency?"

"If the answer is yes, then say yes," said April Walker, CPA and lead manager for tax practice and ethics at the American Institute of CPAs.

"But from a documentation standpoint, there are many different ways that you can interact with cryptocurrency," she said.

"The overarching idea is, however you transact with it, you'll need to track your transactions," said Walker.

This new question is only the latest salvo from the IRS, signaling the taxman's heightened interest in virtual currency.

Last summer, the agency sent letters to more than 10,000 taxpayers with cryptocurrency transactions who may have failed to report income and pay taxes owed.

Here's what you should be aware of when reporting your virtual currency to the IRS.

eclipse_images | E+ | Getty Images

Generally, the IRS treats virtual currency as property, much the same way they would regard stocks or other investments.

That means that if you bought your Ethereum and then sold it or if you exchange it for something else, you're logging either a capital gain or a loss. You'd be responsible for taxes related to the gain.

While cryptocurrency exchanges like Coinbase may provide you with a Form 1099-K detailing these transactions, there's no guarantee you'll get one.

"The taxpayer has to have at least $20,000 in gross sales for the year and a minimum of 200 transactions to get a 1099-K," said Andy Phillips, director for The Tax Institute at H&R Block.

Say you paid $10 for virtual currency, but then bought coffee for $8. You have a $2 loss you need to report.

April Walker

lead manager for tax practice and ethics at the American Institute of CPAs

On the other hand, virtual currency that you get from an employer is treated like wages: You must have federal income taxes withheld from the payment, as well as FICA tax and unemployment taxes.

All of this must be reported on your Form W-2, which you should receive from your employer by the end of January.

Finally, cryptocurrency that you mine must be included in your taxable income. That is, you're including the fair market value of your bitcoin as of the date of receipt.

Don't try hiding your stash from the taxman.

You're running the risk of an audit, as well as paying penalties and interest on the income you failed to report. In the most extreme cases, you could face prison time and a fine of up to $250,000.

A visual representation of the cryptocurrency Bitcoin on November 20, 2018 in London, England.

Jordan Mansfield | Getty Images News | Getty Images

Even the smallest transactions with virtual currency warrant reporting.

"Say you paid $10 for virtual currency, but then bought coffee for $8," said Walker. "You have a $2 loss you need to report."

This capital loss would have to be reported on Form 8949 for sales and disposition of capital assets when you file your taxes, she said.

As you gather data to back up your cryptocurrency activities, keep a close eye on the original value of the asset.

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This is known as your cost basis, and it's how you determine the taxes you pay on your crypto.

While your trading platform should have the details of your transaction history, gathering that data is even more complex for individuals who participate on multiple exchanges, said Phillips.

Different platforms may have variations in price depending on the exchange, so the responsibility falls to the taxpayer to follow the cost basis.

"A lot of professional preparers are using software to assist high-volume crypto traders and ensure they get their basis right," said Phillips.

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It's tax season and the IRS wants to know about your crypto. How to prepare - CNBC

Cryptocurrency mining in Iran has been a controversial topic since the beginning. In the latest move, Iran has issued cryptocurrency mining licenses for over 1,000 cryptocurrencies. Iran turned to cryptocurrency mining once again amidst tension with the United States.

After the death of one of the leading Iranian military commanders General Qassem Suleimani, Iran came to a head to head conflict with the United States recently, while global leaders intervened for peace process in the region.

Iran commenced regulating cryptocurrency mining operations on the governmental level in 2019. A central bank digital currency had also been under deliberation at the same time. At the time, owing to the electricity theft and abuse of the system, the Iranian government went hard on Bitcoin operations.

Overtime cryptocurrency enthusiasts have been reported to ignore the cryptocurrency regulation in order to increase the

Iranian information and communication technology (ICT) official from IranianICT Guild (IIG) Amir Hosseini expressed in a recent interview that the country is turning to the cryptocurrency mining industry eyeing an over eight and a half billion United States dollars worth of revenue generation to the countrys economy.

Hosseini further revealed that the cryptocurrency mining industry despite strict regulation against electric theft and cost issues has the capability to boost Iranian economic conditions.

Although hefty electricity costs are keeping small scale investors away from cryptocurrency mining in Iran. While Hosseini believes that the industry must be given a breather. At the time of writing, Iranian regulations demand that the households and nonprofit spaces must not be using non-commercial electricity for commercial mining operations.

Hosseini feels that an overall decrease in the electricity cost and mining infrastructure setup can improve the mining industry operations by many folds.

Featured Image by KDM

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Cryptocurrency mining in Iran to boost economic conditions - Cryptopolitan

The man thought to be behind notorious cryptocurrency exchange BTC-e, which is involved in a multi-billion Bitcoin BTC fraud case, will be extradited to France.

According to a Greek news report, Alexander Vinnik is facing allegations of laundering at least $4 billion through the cryptocurrency exchange.

[Read:Alleged Russian boss of Bitcoin money-laundering scheme wants to go home]

The extradition comes after a Greek court reportedly gave the go-ahead.

Vinniks lawyer Zoi Konstandopoulou said he had been flown to France just hours the court ruling. The lawyer said he had been taken to hospital as he was on the 35th day of a hunger strike in protest of his prospective extradition to the European country, The New York Times (NYT) reports.

However, NYT notes that Greek authorities were unable to confirm on Thursday whether Vinnik had already left Greece.

France reportedly wants to trial Vinnik for alleged cybercrime, money laundering, belonging to a criminal organization, and extortion.

As previously reported by Hard Fork, Vinnik was arrested by Greek authorities in July 2017 while he was holidaying in the country with his family.

The arrest came after Russia, France, and the US all issued international warrants for his arrest.

Vinnik has maintained his innocence throughout saying: I do not consider myself guilty [] The fact that I worked for BTC-e and did my job, and its not justifiable to accuse me of it. I found out about the charge about a month after I was taken into custody. This was told to me by my Russian lawyer.

Founded in 2011, BTC-e is reported to have handled almost 5 percent of Bitcoins trading volume at one point. However, subsequent research showed that as much 95 percent of ransomware-related cashouts took place through its platform.

An attempt to shut down the exchange was made by the US Justice Department after they charged Vinnik (and BTC-e) with allegedly running an international money laundering operation featuring stolen funds from Mt. Gox.

Published January 24, 2020 11:19 UTC

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Alleged BTC-e boss will be extradited to France over cryptocurrency fraud - The Next Web