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Retail cryptocurrency mining in Thailand has apparently received a boost due to the capitulation of Chinese miners triggered by the country’s new crypto mega ban enforced in September.
Thai entrepreneurs and cryptocurrency businesses have been increasingly capitalizing on Chinese miners getting rid of their crypto mining machines, Al Jazeera reported Wednesday.
“The moment China banned crypto, we were ecstatic,” one Thai-based Bitcoin (BTC) enthusiast and turned miner said.
The miner, who asked to remain anonymous, claimed to have set up a small solar-powered crypto mining unit for about $30,000. “I made it all back in three months,” he said.
Another industry entrepreneur, Pongsakorn Tongtaveenan, started a reseller business for crypto mining devices in Thailand, reportedly selling hundreds of Chinese application-specific integrated circuit (ASIC) miners to small local investors.
According to Pongsakorn, the price of ASICs like the Bitmain Antminer SJ19 Pro collapsed 30% due to the Chinese miner exit before returning to normal amid the growing local demand.
Pongsakorn believes that the increasing popularity of retail crypto mining in Thailand is triggered by people looking for a stable income during the pandemic as well as investors getting more optimistic about the future of digital assets.
“Bitcoin is the gold of the digital world. But a mining rig is like gold mining stocks: you’re paid dividends according to the gold price,” he said.
Thailand is not the only country whose crypto mining development has benefited from China’s crypto miners’ exit. Countries like the United States, Kazakhstan and Russia have seen a massive influx of new crypto mining operations due to the Chinese crypto crackdown.
Related: Thailand to define ‘red lines‘ for crypto in early 2022
The growing popularity of crypto mining in Thailand comes in line with the booming local cryptocurrency adoption, with the turnover at several local crypto exchanges surging to $6.6 million in November 2021 from just $538 million last year.
The institutional demand for crypto in Thailand has been notably growing as well. In early November, Thailand’s oldest bank, Siam Commercial Bank, paid $537 million to buy a 51% stake in BitKub, Thailand’s biggest crypto exchange.
The Australian Securities and Investments Commission (ASIC) has revealed the details of how it took down crypto “pump and dump” Telegram groups back in October.
A pump and dump scheme typically involves using social media to coordinate users to buy large amounts of a thinly traded token to artificially inflate its price. They then cash out with massive gains after other investors, who aren’t in on the scheme, FOMO in on a momentum trade.
The new documents reveal that ASIC has been taking counsel from finance academic and crypto researcher, Talis Putnins since early Oct.
A 38-slide presentation by Putnins to ASIC investigators revealed that pump and dump schemes are cyclical, peaking back during 2018 and again in 2021. The presentation stated that they tend to “correlate with overall market sentiment and prices.”
According to the presentation, there are a number of factors which have changed between 2018 and the time of publication, during Oct 2021. Over a period of six months in 2018, Putnins documented over 355 cases of crypto market manipulation.
He referenced the schemes’ “transparent intention to pump,” and the absence of any “genuine attempt to ignite momentum.” The schemes are “completely out in the open for everyone to see,” the presentation noted.
The presentation detailed the Telegram group “Crypto Binance Trading | Signals & Pumps” Sept 19 pump of fractional algorithmic stablecoin system, Frax Share (FXS), which saw a massive 90% on $65 million volume in less than one minute.
“With our volumes averaging 40 to 80 million $ per pump and peaks reaching up to 450% we are ready to announce our next big pump,” stated a Sept 13 announcement in the group.
“Our main goal for this pump will be to make sure that every single member in our group makes a massive profit. We will also try reaching more than 100 million $ volume in the first few minutes with a very high % gain.”
The presentation cited a perceived lack of legal risk, anonymity in forums and encryption as potential reasons for the groups, adding that there is a “perception that crypto is unregulated therefore pumps are legal.”
The new information was revealed in documents which The Australian newspaper was able to access through a freedom of information request. The Australian published the new information on Dec 28.
Last year, Putnins co-authored a paper titled “A New Wolf in Town? Pump-and-Dump Manipulation in Cryptocurrency Markets.”
The report concluded that crypto pump and dumps have created “extreme price distortions of 65 per cent on average, abnormal trading volumes in the millions of dollars, and large wealth transfers between participants”.
Related: ASIC targets pump and dump Telegram groups
On Oct 15, Cointelegraph reported that ASIC had been investigating schemes across crypto and traditional markets operated through social channels such as Twitter, Telegram and Aussie stock chat forum, HotCopper.
At the time, a Telegram account named “ASIC” posted a message on the “ASX Pump Organisation” chat warning its 300 members that the watchdog was “monitoring this platform,” and its members were being investigated.
“Coordinated pumping of shares for profits can be illegal. We can see all trades and have access to trader identities. […] You run the risk of a criminal record, including fines of more than $1 million and prison time.”
A spokesperson from ASIC told Cointelegraph at the time: “Even where the activity relates to cryptocurrencies/products that may not be financial products under the Corporations Act, the pump-and-dump practice is concerning as it can lead to investor losses and create unnecessary price volatility.”
MyCryptoWallet, a platform that operates as a trading platform in Australia, has notably gone bankrupt. An inevitable situation occurred as many of the platform’s users started complaining that they are unable to access their funds on the exchange.
An investigation report revealed by a local news channel, including The Age and The Sydney Morning Herald, had it that the exchange’s troubles started back in April when the complaints began.
Exchange representatives at the time responded to the reports, claiming that they were false and that the platform has no operational challenges.
“It is quite upsetting to hear you are creating an article about false negativity regarding MyCryptoWallet rather than the amazing, ground-breaking blockchain technology we offer Australian users,” the spokeswoman said at the time.
However, complaints received by Australian market regulator ASIC confirmed that the trading platform is unable to meet its customers’ demand for liquidity. SV Partners, an asset liquidation expert, has now been appointed to oversee the case and help users retrieve their funds from the exchange.
The woes of MyCryptoWallet confirmed the frailty of the cryptocurrency industry in Australia, as this will be the second exchange that went under this year. ACX exchange entered into a voluntary administration earlier this year, owing creditors $21 million.
Australia is one of the few crypto-friendly nations in the world. However, the government is planning to start regulating the digital currency industry, a move that may attract strict regulations going by the risks exchanges in the country are exposing consumers to. Australians are known to be the subject or the victims of major crypto frauds or scams, a situation the regulators may seek to change in the near future.
Trading platforms are one of the first avenues for anyone to get involved in the cryptospace and this has often predisposed them to a number of mishaps. Japan’s MtGox went bankrupt after suffering from a series of hacks, while Canadian exchange, QuadrigaCx went under with the death of its owner, Gerald Cotten.
Image source: Shutterstock
Matt Comyn, the CEO of the Commonwealth Bank of Australia (CBA), said that the bank is more concerned about the risks of missing out on crypto than those associated with its adoption.
The CBA is set to become the first of the “big four” banks in Australia to offer crypto-based services, after the company announced on Nov. 3 that it will support the trading of 10 digital assets directly via its banking app.
Speaking with Bloomberg TV on Friday, Nov. 19, Comyn was questioned on the CBA’s take on the crypto sector, with the CEO noting that:
“We see risks in participating, but we see bigger risks in not participating. It’s important to say that we don’t have a view on the asset price itself, we see it as a very volatile and speculative asset, but we also don’t think that the sector and the technology is going away anytime soon.”
Comyn also suggested that there will be much more to come from the CBA’s crypto adoption play, as he highlighted that the bank sees many use cases from blockchain tech, along with strong demand from consumers.
“And so we want to understand it, we want to provide a competitive offering to customers with the right disclosure around risks. We want to build capability in and around DLT and blockchain technology,” he added.
While the CBA appears to be bullish on crypto and distributed ledger tech, the Australian Securities and Investments Commission (ASIC) has urged for investor caution while also noting that it is unable to oversee the sector.
Speaking at the Australian Financial Review Super & Wealth Summit on Nov. 22, ASIC chairman Joe Longo suggested that the financial enforcer cannot regulate crypto as the asset class currently does not fall under the scope of “financial products” in Australia:
“The demand-driven nature of the rush into crypto has thrown up some unique challenges. At present many crypto-assets are probably not ‘financial products’, making it difficult for financial advisers to offer counsel.”
“ASIC has already provided some guidance on exchange-traded funds linked to crypto-assets — they at least are financial products and traded on a licensed exchange, so there will be some protections there — but for the most part, for now at least, investors are on their own,” he added.
Related: Reserve Bank warns Aussies over punting on ‘fad driven’ cryptocurrencies
In Longo’s personal view, he urged local investors to pursue crypto with great caution, noting that “the maxim ‘don’t put all your eggs in one basket’ comes to mind.” However, he also emphasized that the crypto proposals put forward by the Australian Senate last month was the right move for the local climate.
“Wherever we land from a policy perspective, Senator Bragg’s committee was right to highlight the fact that crypto is on our doorstep, here and now, and being driven by extraordinary consumer and investor demand,” he said.