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Warning: Smartphone text prediction guesses crypto hodler’s seed phrase

Redditor Andre highlighted the ease with which hackers can use the text prediction feature to drain a user’s funds just by being able to first word out of the BIP 39 list.

Seed phrases, a random combination of words from the BIP 39 list of 2048 words, act as one of the primary layers of security against unauthorized access to a user’s crypto holdings. But what happens when your ‘smart’ phone’s predictive typing remembers and suggests the words next time you try to access your digital wallet?

Andre, a 33-year-old IT professional from Germany, recently posted on the r/CryptoCurrency subreddit after discovering his mobile phone’s ability to predict the entire recovery seed phrase as soon as he typed down the first word.

As a fair warning to fellow Redditors and crypto enthusiasts, Andre’s post highlighted the ease with which hackers can use the feature to drain a user’s funds just by being able to type the first word out of the BIP 39 list:

“This makes it easy to attack, get your hands on a phone, start any chat app, and start typing any words off the BIP39 list, and see what the phone suggests.”

Speaking to Cointelegraph, Andre, a.k.a. u/Divinux on Reddit, shared his shock when he first experienced his phone literally guessing the (12-24 word) seed phrase — “First I was stunned - the first couple words could be a coincidence, right?”

As a tech-savvy individual, the German crypto investor was able to reproduce the scenario wherein his mobile phone could accurately predict the seed phrases. After realizing the possible impact of this information if it went out to the wrong hands, “I thought I should tell people about it; I'm sure there are others who also have typed seeds into their phone.”

Andre’s experiments confirmed that Google’s GBoard was the least vulnerable as the software did not predict every word in the correct order. However, Microsoft’s Swiftkey keyboard was able to predict the seed phrase right out of the box. The Samsung keyboard, too, can predict the words if ‘Auto replace’ and ‘Suggest text corrections’ have been manually turned on.

Andre’s initial stint with crypto dates back to 2015, when he momentarily lost interest until he realized he could buy goods and services using Bitcoin (BTC) and other cryptocurrencies. His investment strategy involves purchasing and staking BTC and altcoins such as Terra (LUNA), Algorand (ALGO) and Tezos (XTZ) and “then dollar-cost averaging (DCA) out into BTC when/if they moon.” The IT professional also develops his own coins and tokens as a hobby.

A safety measure against possible hacks, according to Andre, is to store significant and long-term holdings in a hardware wallet. To Redditors across the world, OP’s advice includes — not your keys, not your coins, DYOR, don't FOMO, never invest more than you are willing to lose, always double-check the address you are sending to, always send a small amount beforehand, and disable your PMs in Settings, concluding:

“Do yourself a solid and prevent that from happening by clearing your predictive type cache.”

Related: STEPN impersonators stealing users' seed phrases, warn security experts

Blockchain security firm PeckShield warned the crypto community about a large number of phishing websites targeting users of the Web3 lifestyle app STEPN.

As Cointelegraph reported, based on PechShield’s findings, hackers insert a forged MetaMask browser plugin through which they can steal seed phrases from unsuspecting STEPN users.

Access to seed phrase guarantees complete control over the user’s crypto funds via the STEPN dashboard.

‘Insane Bubble’ Coming to Crypto Assets Amid Memecoin Bottoming Phase, According to Economist Henrik Zeberg

Blockchain-based decentralized messengers: A privacy pipedream?

While blockchain messengers stand to mitigate many of the privacy issues posed by their centralized counterparts, they still have their fair share of unignorable issues.

As people all over the globe have become increasingly aware of their privacy rights and how they are constantly being violated by various prominent social media platforms, the need for tangible, decentralized alternatives has continued to grow rapidly.

For perspective, in 2019, Facebook was ordered to pay a mind-boggling $5-billion fine by the United States Federal Trade Commission for improperly acquiring private data of up to 87 million of its users. Just a year later, the social media giant had to shell out another $550 million to settle a privacy lawsuit that suggested that the firm had illegally accrued customer data (including their biometric and personal details) without their explicit consent.

Such violations have helped spur the need for transparency-driven social media services, particularly decentralized messengers, that provide their users with a high degree of data security. In this regard, the new quantum-resistant, privacy-centric messaging app XX Messenger — developed by cryptographer David Chaum — recently made its way into the market. The app boasts a globally decentralized network of 350 nodes, with each operator earning the platform’s native XX Coin as an incentive for their efforts.

A quantum-resistant messenger would be able to resist most currently known methods of decryption, theoretically guarding against the possibility of a quantum computer used to crack into a user’s communications.

The incentives for blockchain-based messengers

Guy Goldenberg, CEO of MultiNFT — a metaverse-based social media network — told Cointelegraph that the need for decentralized messaging services is driven by two key accelerating factors: users looking for censorship-resistant applications, and a lack of trust in centralized providers when it comes to privacy and data protection. He said:

“Users are showing a rising concern when it comes to their freedom of speech and the ownership of their data rights lately, and with the help of decentralized chat apps, the solution seems to be right around the corner — platforms that are owned by the users and not by a small group of executives, where no single party can control opinions or censor participants.”

Scott Cunningham, an independent blockchain analyst and social media influencer, told Cointelegraph that the core proposition put forth by decentralized messaging platforms is that they provide users with end-to-end encrypted solutions that ensure consumer anonymity as well as a high degree of privacy. To strengthen his case, he shared a recent unpleasant experience with Facebook’s Messenger:

“I sent a note to myself [meant to be read later by me] only to find that Facebook is monitoring messages to myself and removed it due to a community violation. Once someone experiences firsthand that everything they say is being tracked and evaluated in real-time, they will feel more compelled to move.”

The drawbacks are quite real 

While a decentralized messenger could theoretically preserve the privacy of the masses, blockchain technology in itself could be a barrier to adoption.

Ingo Rübe, founder of blockchain-based identity network Kilt Protocol, noted that decentralized messengers need real-time relay and storage capabilities, as it is quite unrealistic for receivers to be online whenever someone sends them a text. “A possible solution would be to use random single blockchain nodes as relays, but it might be unreliable,” he admitted. 

Goldenberg said that the use of blockchain tech poses further problems when it comes to network upgrades. “Updates on blockchain systems are very rarely backwards compatible and can sometimes present issues that a product may not be able to survive,” Goldenberg added.

Yung Beef, content lead and community manager at Subsocial — a Polkadot-based platform for launching decentralized social networks — told Cointelegraph that one of the biggest barriers is transaction fees, adding:

“We’re already struggling enough with creating a social networking platform that has transaction fees, and with how much people message each other, I’m not sure that it would ever really be feasible.”

While he admitted that Subsocial is actively looking for ways through which to implement a private messaging module, the challenges are quite drastic, making the vision a bit of a pipedream. “We’re working on a way to lock SUB [the platform’s native crypto token] to get a certain number of free transactions a day, but that still doesn’t solve the problem of some people sending thousands of messages a day,” he added.

A similar sentiment was echoed by Rübe, who told Cointelegraph that a decentralized messaging service would be faced with multiple challenges from the get-go, starting with the fact that it would be costly to put messages on a blockchain. Even if they did make their way onto a network, they would not be very secure because it would be quite easy for anyone with access to the system to read them. 

Alexander Klus, founder of Creaton — a decentralized content sharing platform — told Cointelegraph that a fully functional, viable blockchain messenger is a very hard problem to solve, pointing out that existing platforms such as Etherscan’s messaging service are quite centralized. Even Status, the official Ethereum messenger, contains some degree of centralization in order to scale better, he said, adding:

“Choosing a platform like Signal as a messaging platform would be best, as it has very good encryption. Also, permanence in terms of messaging isn’t a big deal or something most users don’t even want anyway.”

Another major problem is adoption since most decentralized products that currently exist within this realm simply can’t compete with the giants they are up against such as Telegram, WhatsApp and WeChat. Goldenberg stated:

“Users have a habitual way of doing things, and new platforms need a viral accelerator for adoption because they require massive migration, which is almost not possible. You see, for a chat application to be useful, you need all (or most of) your contacts to use it, and that takes time, marketing and willingness.”

Is there any middle ground to be found?

While popular privacy-oriented apps, including Signal and Telegram, claim to approach user privacy with a great deal of care, making use of end-to-end encryption or client-server encryption, the former is only as secure as its coding. In this regard, Chaum pointed out that messages from these platforms can still theoretically be compromised and decoded by a powerful computer if they have not been deleted permanently.

Therefore, moving forward, it will be interesting to see whether developers are able to come up with blockchain-powered messaging services that offer the same degree of functional and operational flexibility as their centralized counterparts while being able to tackle the issue of high transaction fees in a long-term and practical manner.

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The post Will Quantum Computing Technology Be Small Enough To Fit Into Smartphones? appeared first on The Daily Hodl.

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Xiaomi India needs regulatory clarity to embrace crypto, says exec

According to Xiaomi India managing director Manu Jain, cryptocurrency is an “extremely interesting” area that is doing “exceptionally well.”

Xiaomi India — the subcontinent's branch of the major mobile phone manufacturer — is interested in the cryptocurrency industry, but needs regulatory clarity from the government.

The firm's managing director, Manu Jain, said in an interview with The Economic Times, “We will want to wait for all the regulatory things. Of course, crypto is an area, which is extremely interesting, and is the biggest buzzword and is doing exceptionally well. But, we would want to understand more on the regulation side.” 

Jain’s latest remarks come after the company’s financial service business returned to growth in 2021, seeing a 35% year-on-year surge in the first quarter due to expanding into more financial products.

The company has been actively diversifying its products into a full spectrum lending platform focused on payments, lending and insurance, launching e-commerce and loan services in India last year. 

Related: Xiaomi denies involvement in shop accepting Bitcoin in Portugal

India is reportedly Xiaomi’s biggest market outside China, and neither country is known for being particularly friendly toward crypto, with the Chinese government aggressively scrutinizing crypto trading and mining, and the Indian crypto industry still facing extreme regulatory uncertainty.

Xiaomi Global and Xiaomi India did not immediately respond to Cointelegraph’s request for comment.

Xiaomi recently denied involvement in an effort by a Portuguese Xiaomi shop to start accepting Bitcoin (BTC) payments. Mi Store Portugal eventually abandoned plans to enable crypto payments for Xiaomi devices after the Chinese electronics manufacturer said that the shop was not directly related to its operations.

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Xiaomi retailer in Portugal now accepts Bitcoin payments

The official Portuguese shop of Chinese electronics giant Xiaomi has partnered with Utrust to unlock payments in five cryptocurrencies.

Chinese electronics manufacturer Xiaomi is the latest global company to get involved in the cryptocurrency industry as its official Portuguese shop now accepts Bitcoin (BTC) payments.

Mi Store Portugal, the official Xiaomi retailer, announced Wednesday on Facebook that it now allows customers to purchase devices using five cryptocurrencies, including BTC, Ether (ETH), Tether (USDT), Dash (DASH) and the Utrust (UTK) token.

According to the official Mi Store Portugal website, customers can now select the option to pay with crypto at checkout.

The new payment option is enabled through a partnership with Utrust, a European blockchain technology payment platform. “Xiaomi is the second-largest phone manufacturer in the world, and now their local branch is accepting the Money of Tomorrow,” Utrust’s official Twitter account said Wednesday.

According to data from global industry analysis firm Counterpoint, Xiaomi surpassed global smartphone giant Apple as the second-largest mobile phone manufacturer in the world in the second quarter of 2021.

Mi Store Portugal is the only official retailer of Xiaomi’s certified products in Portugal, operating under the European legislation, the company’s website notes. The firm currently has six physical stores nationwide and is in the process of expansion.

Related: New study reveals high demand for payments in cryptocurrency

Pedro Maia, marketing director of Mi Store Portugal, reportedly said that the company’s move to accept crypto payments aligns with Xiaomi’s striving for innovation. “We are a technological, innovative, and disruptive brand. That’s why we always want to be one step ahead. We want to give the possibility to all true technology fans to buy their favorite gadgets with what is currently the ‘most technological money.’”

As previously reported, Portugal has been steadily growing as a cryptocurrency-friendly country in recent years, with the local government charging zero taxes from retail crypto trading. Earlier this year, a local energy trading firm started accepting Bitcoin as payment for electricity bills.

‘Insane Bubble’ Coming to Crypto Assets Amid Memecoin Bottoming Phase, According to Economist Henrik Zeberg

Coinbase rival Kraken launches mobile crypto trading in US

Kraken’s mobile crypto trading app is now available across the United States, except for New York and Washington.

Major global cryptocurrency exchange Kraken has launched a mobile crypto trading application in a new move to boost industry adoption in the United States.

The company announced Wednesday that its new app is now available for most of the United States as well as other countries around the world for both iOS and Android users.

The app allows users to trade more than 50 cryptocurrencies like Bitcoin (BTC) and Ether (ETH) via smartphones. The move follows a rollout of the Kraken mobile app in Europe this January.

“This consumer app is our first major foray into supporting wider consumer adoption in a much more simplified, easy-to-use interface,” Kraken chief product officer Jeremy Welch reportedly noted.

The new app launch comes amid Kraken trading volumes growing more than sixfold on year-to-date as of May, Welch said. “The last five months have been pretty unreal at Kraken. We’ve seen a surge in new clients and in all-time highs,” he added.

Launched in 2013, Kraken reportedly says that it has 7 million customers so far, being one of the world’s largest crypto trading venues, competing with companies like Binance, Huobi, and Coinbase. The exchange is ranked the fourth-largest cryptocurrency trading platform by daily trading volumes at the time of writing, according to data from CoinMarketCap.

Kraken’s newly rolled app will not be supported all across the U.S. as the exchange does not offer services to residents of Washington and New York due to the “cost of maintaining regulatory compliance.” The company is registered as a money services business with the U.S. Treasury Department’s FinCEN and says it complies “with legal and regulatory requirements in all jurisdictions” of operation.

The new availability comes less than two months after Kraken’s major rival, Coinbase exchange, went public on Nasdaq in April. Subsequently, major investment trust RIT Capital Partners acquired a stake in Kraken, with RIT exec James Glass noting that the crypto exchange is reportedly set to go public through a direct listing in 2022. Bloomberg reported in February that Kraken was in talks for new funding that could double its valuation to $10 billion.

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