The Daily Update - ECB QE / Cryptocurrency heist

Klass Knot, the Dutch Central Bank President, has said in an interview over the weekend that the European Central Bank (ECB) should make it crystal clear how it will end its current bond buying programme that is due to expire in September this year. ‘The program has done what could realistically be expected of it’ he told a Dutch current affairs programme.

Knot believes his view is at odds with that of ECB president Mario Draghi, as he thinks Draghi wants to keep all options open to help keep the Euro’s recent rise in check, ‘There is no reason whatsoever to continue the programme’ Knot believes, adding ‘I feel that we need to be clear about this’. However, because the ECB wants to keep all options on the table, it has intentionally left the possibility open to continue buying bonds after that date.

Knot thinks that ending QE this year could pave the way for possible interest rate hikes in 2019, but does concede that any rate hikes would probably be slow and gradual going forward, saying ‘Interest is mainly low because there are more people that want to save, than that want to invest. This will change as the economy grows, but that will take time’.

And, in one of the biggest heists in history, hackers stole over USD530mln worth of digital money from the Japanese cryptocurrency exchange Coincheck Inc. The exchange yesterday said it would return 90% of the money customers lost. The reason that hackers were able to access Coincheck coins was because they were stored in what’s called a ‘hot wallet’ which was connected to external networks, rather than a ‘cold wallet’ that is outside the internet. It seems that Coincheck also thought it was a good idea to not use an extra layer of security known as a multi-signature system. The company have stated it is confident the heist was not an inside job! It seems that with Coincheck security systems, it did not need to be.

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