JPMorgan: Stablecoins, Such As Libra, Have ‘Potential to Grow Substantially’

Analysts at U.S. financial services giant JPMorgan Chase (reportedly) said, in a note to clients on Thursday (September 5), that stablecoins "have the potential to grow substantially" but there is the risk of "payment system gridlock, particularly during periods of stress." They also had special concerns regarding Libra.

According to a report in Bloomberg published on 5 September 2019, the JPMorgan analysts said that although the total reported market cap for all stablecoins is under $5 billion, these low-volatility altcoins are destined for fast growth, especially Libra, Facebook's proposed cryptocurrency. However, the analysts warned that there is the risk that they might grow too fast and get subjected to bottlenecks since they do not have sufficient short-term liquidity (which is a feature of other payment systems):

Stablecoins, and Libra in particular, have the potential to grow substantially and ultimately shoulder a significant fraction of global transactional activity. However, as currently designed and proposed, they do not take into account the microstructure of operating such a payment system. The risk of payment system gridlock, particularly during periods of stress, could have serious macroeconomic consequences.

And with regard to Libra, they pointed out that there is also the risk of negative yields:

Any system that relies on reserve-asset income to fund operational and other ongoing costs becomes unstable in a negative yield world. With more than half of high-quality short-term sovereign debt already negative, the vast majority of the remainder made up of U.S. government securities, and trends pointing towards global monetary easing, a fully negative yielding Libra reserve has become a plausible (some would argue likely) risk.

 

Hackers Try to Sell Data of 142 Million MGM Hotel Guests for Bitcoin or Monero

Hackers are trying to sell the data of 142 million MGM hotel guests on the dark web for about $2,900 worth of cryptocurrency, payable in either bitcoin or monero (XMR).

According to ZDNet, the data comes from a 2019 data breach that MGM Resorts (NYSE: MGM) that was initially believed to have only affected 10.6 million MGM hotel guests, as the hackers published a free sample of the data available for download.

The new finding, that a total of 142,479,937 hotel guests had their data stolen by a hacker, was discovered after a hacker published an ad to sell the data on a darknet market. The hacker claims to have gotten to the data after breaching data leak monitoring service DataViper, which is operated by Night Lion Security.

The founder of Night Lion Security, Vinny Troia, reportedly told ZDNet the firm never owned a copy of MGM’s full database, and that the hackers were trying to ruin its reputation with their claims. While MGM Resorts learned of the security breach last year, it did not make it public and instead just notified impacted customers.

Speaking to ZDNet, an MGM spokesperson said:

MGM Resorts was aware of the scope of this previously reported incident from last summer and has already addressed the situation

The spokesperson also added that the majority of data consisted of “contract information like names, postal addresses, and email addresses.”  Social Security numbers, reservation data, and other financial information was not leaked, according to MGM.

Irina Nesterovsky, Head of Research at threat intel firm KELA, reportedly noted that the MGM data has been for sale on private hacking circles since at least July 2019 and that the situation could be even worse, as posts from Russian-speaking forums claimed to contain the details of 200 million hotel guests.

For now, it’s only clear that the hacker who has the data is trying to sell it for $2,900 worth of either bitcoin or XMR on an unnamed darknet marketplace.

Featured image via Pixabay.