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Exclusive: Coincheck hackers trying to move stolen cryptocurrency

LONDON (Reuters) – Hackers who stole around $530 million worth of cryptocurrency from the Coincheck exchange last week — one of the biggest such heists ever — are trying to move the stolen “XEM” coins, the foundation behind the digital currency said on Tuesday.

NEM Foundation, creators of the XEM cryptocurrency, have traced the stolen coins to an unidentified account, and the account owner had begun trying to move the coins onto six exchanges where they could then be sold, Jeff McDonald said.

Hackers made off with roughly 58 billion Japanese yen ($533 million) worth of the cryptocurrency from Tokyo-based exchange Coincheck Inc late last week, raising fresh questions about security and regulatory protection in the booming market.

The location of the hackers’ account was not known.

“[The hackers are] trying to spend them on multiple exchanges. We are contacting those exchanges,” Singapore-based McDonald told Reuters.

NEM Foundation spokeswoman Alexandra Tinsman said the hacker had started sending out “XEM” coins to random accounts in 100 XEM batches, worth about $83 each.

“When people look to launder these types of funds, they sometimes spread it into smaller transactions because it’s less likely to trigger (exchanges’) anti-money laundering (mechanisms),” said Tom Robinson, co-founder of Elliptic, a cryptocurrency security firm in London.

Robinson said such hopping among different cryptocurrencies was becoming more prevalent among cybercriminals trying to cover their tracks.

The coins that the hackers had taken made up around 5 percent of the total supply of XEM, the world’s 10th biggest cryptocurrency, according to trade website Coinmarketcap.

McDonald said the hackers were unlikely to try to spend anything close to all of the stolen cryptocurrency at once, because the “market simply couldn’t absorb that much”.

If the hackers successfully moved the coins to an exchange, they were likely to try to swap them into another cryptocurrency before transferring the coins back into a conventional currency, he said. That would make the funds difficult or near impossible to trace.

“I would assume that they are going to get away with some of the money,” McDonald said.


At least three dozen heists on cryptocurrency exchanges since 2011 are known; many of the hacked exchanges later shut down. More than 980,000 bitcoins have been stolen, and few have ever been recovered.

In 2014, Tokyo-based Mt. Gox, which once handled 80 percent of the world’s bitcoin trades, filed for bankruptcy after losing bitcoins worth around half a billion dollars — then the biggest ever such heist, which triggered a huge sell-off in bitcoin.

“It shows how far the industry has come that a hack of this scale isn’t really an issue,” said Robinson at Elliptic. “This is just kind of a blip.”

As of 1744 GMT, XEM was trading at around $0.83 per coin, with a total market value of around $7.5 billion. That was around 20 percent lower than trading levels on Friday, when the hack was announced, but XEM is still up almost 300 percent over the past two months.

Japan’s Financial Services Agency (FSA) on Monday ordered improvements to operations at Coincheck, which on Friday suspended trading in all cryptocurrencies except bitcoin.

Reporting by Tommy Wilkes; Editing by Sujata Rao, Catherine Evans, Larry King

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U.S. agencies investigate Apple over slowing iPhones: Bloomberg

(Reuters) – The U.S. Department of Justice and the Securities and Exchange Commission are investigating whether Apple Inc violated securities laws concerning its disclosures that it slowed older iPhones with flagging batteries, Bloomberg reported on Tuesday.

The government has requested information from the company, Bloomberg reported, citing people familiar with the matter.

The chairman of a U.S. Senate committee overseeing business issues asked Apple to answer questions about its disclosures, Reuters reported this month.

Apple did not immediately respond to a request for comment. An SEC spokesman and Justice Department spokeswoman declined to comment.

The company admitted in December that iPhone software can slow down some phones with battery problems.

Apple said the problem was that aging lithium batteries delivered power unevenly, which could cause iPhones to shut down unexpectedly to protect the delicate circuits inside.

Apple posted a public apology over its handling of the battery issue and lowered the price of iPhone battery replacements from $79 to $29.

Reporting by Munsif Vengattil in Bengaluru, Stephen Nellis in San Francisco and Sarah Lynch in Washington; editing by Anil D’Silva and Susan Thomas

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Reuters News to get $325 million annually under Blackstone offer: sources

LONDON (Reuters) – Blackstone Group LP (BX.N) has agreed that annual payments of $325 million would be made for 30 years to the Reuters News business as part of an offer by the U.S. private equity firm to buy a majority stake in Thomson Reuters’ (TRI.N) (TRI.TO) Financial and Risk unit, two sources familiar with the matter said on Tuesday.

The payments – which would amount to almost $10 billion over three decades – would be made by the new Financial and Risk company for Reuters news content, the sources said. Blackstone would own 55 percent in the new company and Thomson Reuters would retain a stake of 45 percent.   

Thomson Reuters, the parent of Reuters News, said late on Monday it was “in advanced discussions with Blackstone regarding a potential partnership in its FR business”. Reuters News supplies news to the Financial and Risk unit’s desktop product, Eikon.

(This version of the story has been refiled to clarify terms of offer)

Reporting by Pamela Barbaglia; Editing by Pravin Char

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"Zinc metal demand (for) battery storage would be 19.8Mt of metal"

“We have been of the opinion that grid energy storage demands a solution no more expensive than pumped hydro or compressed air energy storage,” Toronto-based Stormcrow Capital president Jon Hykawy and managing partner Tom Chudnovsky say in Stormcrow’s first zinc market report.

“Lithium batteries are not that solution, and while we have hope, vanadium redox batteries are not there.

Barminco raises the bar

Barminco raises the bar

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Heron ready to fly

“What is not normally considered by investors is the possibility that a boring base metal might become an exciting technology metal. We believe that this is precisely what may happen in the next few years to zinc, as various firms bring their inexpensive zinc-air stationery batteries to the market as a cost-effective grid-storage technology.

“If we are correct in our assessment that zinc-air batteries can become a serious player in the grid-storage market, then technology investors will also have to begin to look at zinc in the same way that they have begun to look at lithium and cobalt.”

The producers of much specialised research on ‘new technology metals and minerals’, including lithium, vanadium, cobalt and others, Stormcrow’s principals say they haven’t included large-scale grid storage as a demand driver for lithium or cobalt because “we were never able to rationalise the cost of lithium batteries in that use”.

“Undoubtedly, there will be some specific uses where lithium batteries will be preferred, for their size and weight,” they say.

“However … the cost of new zinc-air cells makes their use in the grid compelling.”

Stormcrow says while lithium batteries have made strides over the last three decades, costs of zinc-air batteries are only just beginning to be reduced through scale and continued development.

“In the last two years, several zinc battery companies have made strides in overcoming problems with their electrically-rechargeable zinc-air batteries that make them not only viable entrants in this space, but, arguably, the best such storage devices, outpacing flow batteries and all other technology.”

Stormcrow uses US-based Eos Energy Storage as Exhibit A. The company, it says, “appears to have the highest traction in the space at present, and announced early last year it had started a collaboration with Germany’s Siemens on the “integration, installation and servicing of energy storage systems”.

Eos was offering its Znyth battery system for delivery in 2022 at a price of US$95 per usable kWh contained in a single cycle of the battery, it said. On that metric, the “levelized cost” of using this battery system at that price could be about US$55/MWh, which put the cost of the Znyth battery at the low end of all “dependable” generating technologies, and made storage a cost-effective alternative.

“There are several other companies attempting to develop and market similar technology,” Hykawy and Chudnovsky say in their report.

Analysis of detailed Eos battery design documents indicated a 1MW/4MWh battery system that might be delivered in 2022 and cost US$380,000 – and which the Stormcrow authors said packed the energy of 40 Tesla Model S P100Ds – could have 18t of zinc metal in it, or about US$58,000 worth at current prices.

“Compared to the estimate for 2016 mined production of zinc by the US Geological Survey of 11.9 million tonnes, 18t is a drop in the ocean,” they said.

“However, we must consider the overall potential demand for grid storage, especially considering that what we are discussing is the first true instance of cheap and operationally flexible grid storage.”

Extensive Stormcrow research on current and emerging global energy storage needs connected to nuclear and renewable capacity leads the firm to estimate demand from cheap grid storage using batteries could run to 4,404GGWh, including 3,904GWh for renewables. Potential demand in the ‘fast back-up systems’ space could actually double this storage requirement, Hykawy and Chudnovsky suggest.

“The zinc metal demand from 4,404GWh of zinc-air battery storage would be roughly 19,818,000 tonnes of metal,” Stormcrow’s report says.

“This amount of metal represents roughly 1.5-times the annual production of zinc metal in the world.

“We should bear in mind that these batteries will be deployed over time, smoothing out demand.

“Even so, we could see as much as 3-6% annual impacts in demand in the future.”


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Alio Gold aiming for return to 2016

Alio said this month it had produced 83,000 ounces of gold at the mine in 2017, a 17% fall year-on-year.

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"Bigger trigger" needed to get gold over $1,380

Gold will struggle to break the US$1,380 per ounce “ceiling” without a major global trigger, Saxo Bank commodity strategy chief Ole Hansen says.

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Premier Gold takes exploration to the max

The Mercedes mine in Mexico produced 82,534oz of gold in 2017

Premier Gold

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Petropavlovsk steadies ship with guidance hit

Petropavlovsk (LN:POG) may have gone through some volatility at the investment, board and management level in recent months, but the latest production results show its Russia gold assets are still performing as expected.

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Base adds Africa expert to board

Zinc, Glencore gain

Capital markets

30 JAN 2018

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