Popular cryptocurrency exchange Binance announced today that it has launched a new division dedicated specifically to industry analysis.
In a November 8, 2018, announcement, Binance described some of the responsibilities of this new division, which has been dubbed Binance Research. The research is “focused on the creation of institutional-grade research reports” and has “the aim of increasing transparency and improving the quality of information available within the crypto space.”
To this end, Binance has paired the official public announcement of this new division with some of the research that it has already been doing before going public. The articles that have gone live concurrently are examples of the kind of content that this new division will generate in the future.
Research first dropped a report on the development of the Loom Network, assessing its capabilities by a wide number of metrics. Not only does the report list the accomplishments and milestones of the projects, but it also provides data and graphs on its historical price data, key features, token sale data and even the specific wallet addresses that hold more than 90 percent of said tokens.
The report on GoChain has a similar level of depth in its findings, providing everything from short biographies on lead developers to snippets of the actual code, as well as including all of the previously mentioned metrics of sales history and more.
For a first-day release of this new division, the existing research and analysis appear to be comprehensive in depth and scope.
Binance Research has promised to release a third set of analytics on Pundi X “with more set to be regularly released over the coming weeks.”
This article originally appeared on Bitcoin Magazine.
With the exception of the SEC’s FinHub announcement, it has been a quiet week for regulatory news — something we’ve been getting a lot of recently as U.S. officials clamp down on unscrupulous coin offerings and crypto companies.
Instead, stablecoins crowded headlines this week, as tether — among others — had difficulties retaining its peg, and top exchanges rolled out support for some of the asset class’ regulatory-compliant newcomers.
All the while, developers remind us that, even in bear markets, the tools of innovation continue to work against the buzz of speculation.
Tether took a dip this week. The market’s leading stablecoin dropped to as low as $0.92 cents for its exchange-averaged price as a market-wide selloff left the coin wanting in demand. By consequence, bitcoin on tether-supported exchanges began trading at somewhat of a premium, an inflated price that reflected bitcoin’s worth against tether’s discounted price rather than its worth against the actual dollar. At the time of writing, tether has shaved off roughly $800 million from its market cap over the week — that’s nearly a third of its entire value.
As tether was unravelling, two of the industry’s highest volume exchanges listed four of the top stablecoins’ staunches competitors. Huobi and OKEx both announced support for TrueUSD, Gemini USD, USD Coin and the Paxos Standard earlier this week, moves that may have aggravated the sell off that crippled tether’s peg. The four stablecoins, which are fiat-collateralized like tether, are considered transparent, regulator-friendly alternatives to what was the market’s only viable stablecoin until this year.
An Auckland developer sent bitcoin to his girlfriend earlier this week without access to internet — seriously. Leveraging technology developed by goTenna and Samourai Wallet, the Kiwi dev was able to transfer bitcoin across New Zealand using only a $27 smartphone and some impressive mesh network architecturing.
On October 18, 2018, the U.S. Securities and Exchange Commission (SEC) announced that it has created a new offices dedicated to fintech startups, including cryptocurrency and blockchain companies. The office will be a resource for these fledging organizations as the try to navigate unspecified regulations and comply with government mandates.
This article originally appeared on Bitcoin Magazine.
I accepted the invitation to review Java by Comparison: Become a Java Craftsman in 70 Examples (2018, The Pragmatic Bookshelf) because the premise of this book interested me. The book Software Craftsmanship: The New Imperative had a significant effect on me when I was a less-experienced software developer, and I looked forward to reviewing Java by Comparison because of its connection with the concept of software craftsmanship and its examples being provided in the Java programming language. I was provided with the electronic version of the book and I chose the PDF format for my review.
Java by Comparison is written by Simon Harrer, Jörg Lenhard, and Linus Dietz and has over 160 pages of substantive content (not counting prefaces, forewords, table of contents, etc.). Java by Comparison features nine chapters and the 70 cases covered span the first eight of those nine chapters.
This past week saw a flurry of reports and analyses released by various agencies and companies, speculating on the roles — past and present — of cryptocurrencies and blockchain technologies. Two big names in the blockchain industry are being scrutinized as they attempt to grow, and we put two privacycoins, Monero and Zcash, under the microscope.
Stay on top of the best stories in the bitcoin, blockchain and cryptocurrency industry. Subscribe to our newsletter here.
A remarkable number of reports were released this week that, together, contributed to a comprehensive picture of the cryptocurrency industry’s trajectory. Two of them focused on stablecoins.
Contrary to the conclusion of another study by John Griffin and Amin Shams that Tether was being used to manipulate the price of bitcoin, a new report by Dr. Wang Chun Wei of the University of Queensland Business School states that the effect of the stablecoin is statistically insignificant as far as bitcoin pricing is concerned.
At the end of the week, Blockchain released a study that examined both the positive and negative aspects of stablecoins, painting an overall picture of optimism for the budding asset class.
Another study tackles the subject of malicious mining, also known as cryptojacking, in the cryptocurrency space, and it points out that the problem is on the rise as bad actors become more sophisticated.
And finally, after a series of roundtable discussions, MIT Connection Science and IBM issued a 41-page joint report on the role of blockchain in government. The findings illuminate discussions held by private and public sector leaders on the blockchain’s impact for government on digital identity, payments and supply chain/provenance.
Think you know Bitcoin? Bitcoin Magazine has reissued its popular Bitcoin Quiz with 30 new questions at the Novice, Intermediate and Expert level. Study up and see how you fare.
Earlier this month, we reviewed Monero as a privacycoin. This week, we learned about a bug in its code that could have had some serious consequences had it not been patched in a timely fashion. Continuing our series on privacycoins, we examined Zcash this week, and our coverage has since generated some fiery discussion on social media.
Two of the biggest names in the crypto space have made some big news. Coinbase began by introducing an application process to onboard new altcoins and then went on to announce a new series of educational resources and a product that allows customers to buy a bundle of Coinbase’s listed assets.
Potential investors got a peek at Bitmain’s IPO prospectus this week, but the information contained within may make them pause before deciding whether or not to take a chance on the mining giant’s future.
This article originally appeared on Bitcoin Magazine.
In this overview, we explore Kraken and its journey from a Mt. Gox alternative to soften the blow of bitcoin’s dependence on just one exchange to becoming one of the most respected cryptocurrency exchanges in the world. We’ll also look at the various features of its platform, chiefly trading and acquiring cryptocurrency.
Operating since: May 2013 (beta) / September 2013
Location: Canada, EU, Japan, U.S.
Fiat pairs supported: USD, EUR, CAD, JPY
Notable cryptocurrencies supported: BTC, ETH, LTC, BCH, XRP, XMR, DASH, XLM, DOGE, EOS, ICN, GNO, MLN, REP, USDT, ZEC, ADA, QTUM
Countries served: Worldwide, with restrictions in New York and some other areas.
Account verification: Full name, date of birth, mobile number, country of residence (Tier 1), + physical address (Tier 2), + proof of identity and proof of address (Tier 3), + know-your-customer (KYC) documents and application form (Tier 4)
Funding options: SEPA bank transfer, SWIFT, U.S. domestic wire transfers, Japanese domestic wire transfers, Canadian domestic wire transfers, cryptocurrency
Withdrawal options: SEPA bank transfer, cryptocurrency, electronic funds transfer (EFT) for CAD, SWIFT, U.S. domestic wire transfers, Japanese domestic wire transfers, Canadian domestic wire transfers
Fee structure: 0.36 percent sliding down to 0 percent depending on 30-day volume, asset traded, trade size and whether your order is “maker” or “taker”
While Kraken was founded in July 2011, it eventually emerged as a platform to reduce the bitcoin market’s dependency on a single exchange. Kraken’s founder and CEO, Jesse Powell, offered assistance to Mt. Gox, which accounted for around 70 percent of all bitcoin trades over the period of April 2013 until early 2014, following two hacks in 2013.
After surveying the poor management of Mt. Gox during May 2013, Powell launched the beta version of Kraken and the startup began to thrive in one of the technological centers of the world, San Francisco’s Bay Area. Powell is quoted as saying in 2014, “I wanted there to be another [exchange] to take its place, if Mt. Gox failed.” And indeed, Kraken delivered.
In the same year, Payward, Kraken’s parent company, raised $5 million in a Series A funding round that was led by Hummingbird Ventures and included Digital Currency Group and Blockchain Capital. These funds were secured for the exchange’s security and legal compliance. In February 2016, SBI Ventures led a multimillion-dollar Series B funding round to widen the exchange’s reach; that round also included support from Money Partners Group, a leading foreign exchange broker in Japan.
The company started by offering bitcoin and litecoin, and gradually expanded to include dogecoin in April 2014 and Ethereum’s ether in August 2015. The exchange now offers nine out of ten of the top cryptocurrencies by market capitalization.
Kraken has also been a strong supporter of sensible regulation. Along with Bitfinex, Kraken pulled out of New York following the BitLicense proposals in 2015, which were seen as stifling innovation. Due to troubles with U.S. regulators, Kraken shifted focus to other markets, such as Canada in July 2015.
More recently, Powell came out against regulatory measures from New York, which for some has added more credibility among crypto enthusiasts to the exchange as one business at the forefront of the crypto revolution, striving for sensible regulation. When asked about details on operations, internal controls and measures for market manipulation and fraud in early 2018, Kraken declined to participate.
In 2017, the exchange explained that while its competitors may have some sort of insurance schemes in place, they looked into different insurance policies and determined that none offered significant protection for their clients. They also mentioned FDIC insurance does not cover losses due to hacks or the loss of bitcoin or other cryptocurrencies.
Instead, they think having world-class security in pace is the best protection, adding, “But if some form of insurance becomes available that really offers a significant level of protection without being prohibitively expensive, we will certainly consider adopting it.”
The exchange claimed to have pulled out of New York in August 2015 but it has come under fire in September 2018, with New York’s legal chief accusing Kraken of operating illegally in the state, referring the supposed violation to the New York Department for Financial Services (NYFDS). The uncertainty as to what will happen going forward could turn into a regulatory risk for Kraken and its US customers.
Kraken is one of the longest-, continuously running Bitcoin exchanges and one of the most respected due to its security practices, ethics and “agnostic support” for the cryptocurrency sector. Powell has previously stated, “We are an agnostic exchange which means that we do not prefer a certain digital asset over another,” when judging the investment case study competition in conjunction with The Economist.
Kraken never delayed the introduction of contentious forks, like Bitcoin Cash or Ethereum Classic, or sided with a particular cryptocurrency project. At the same time, Kraken has not hastily added new cryptocurrencies, like Bitfinex has done in the past (e.g., Bitcoin Interest), suggesting their restraint is down to the company wanting the cryptocurrency space as a whole to succeed rather than risk promoting scams. One comical tweet from Kraken pokes fun at Coinbase for its announcement of potential additions to its platform in July 2018.
Compared to how Coinbase handled Bitcoin Cash, with accusations of market manipulation and insider trading when BCH-USD soared above $3,500 in January 2018, Kraken added BCH with no controversy, shortly after the fork took place. Moreover, Powell has never publicly stated what his cryptocurrency holdings are, which again contrasts to Coinbase CEO Brian Armstrong, who has stated previously that he holds more ether than bitcoin.
Kraken undergoes a regular audit to prove that it has the full reserves of cryptocurrency to back up its operations and was the first to provide a cryptographically verified proof of reserves following the Mt. Gox implosion. The auditor checks the balances of Kraken’s holdings, with the exchange providing the addresses by signing them. The addresses’ public signatures are then summed to check the total bitcoin balance at a certain point in time.
Then the exchange provides the balances of each customer’s account, and the auditor ensures that this figure matches up with the balance held. A Merkle tree is used, where the auditor publishes the root node hash so it is publicly available to confirm that the balances held are approximately the same as the sum of customer balances, using the Bitcoin blockchain.
Finally, users can independently verify that their data was used in the audit, enabling customers to conform to the motto “Don’t trust, verify.”
As usual, two-factor authentication is suggested so that individuals’ personal data cannot be leaked. Kraken also recommends setting up a Master Key so that you can still recover your account if you lose access to your login details or if a hacker gains access to your account. By using the Master Key, you can prevent a password reset.
If you are planning on holding your cryptoassets on the Kraken exchange for a long period of time (for example, if you are performing a margin trade that you expect to last around a month), then enabling the Global Setting Lock (GSL) is also advised. This security feature ensures that no changes can be made to your account setting and hides sensitive information. If a hacker gains access to your account while GSL is enabled, they will be unable to add new withdrawal addresses or change the email address associated with the account.
Finally, you can set up PGP within your email to ensure that all communications from Kraken are genuine and are not phishing links or tampered emails. Having your emails coming from Kraken to you encrypted adds an extra layer of security as, from time to time, you may have sensitive information contained within correspondences from the exchange. All correspondence is done via email, and the business does not have a phone number for support.
The platform itself has never been hacked, but its users have due to poor OpSec, so it is best to take advantage of all the features outlined above. Another key point to make is to use a fresh email address, one that is not publicly known, for each exchange to thwart potential hacking attempts. To encourage white hat hackers to disclose and help patch vulnerabilities in the site, Kraken offers a bug bounty with a discretionary reward based on the severity of the issue.
At the time of writing, the majority of the volume on the Kraken exchange is geared toward Ethereum’s ether (ETH), followed by bitcoin (BTC), ripple (XRP), EOS, Tether (USDT) and monero (XMR). While Kraken offers both USD and EUR pairs for all cryptocurrencies, the EUR pairs are generally more liquid, and if you are margin trading, you may want to take advantage of this.
If you are using an arbitrage strategy, it may be worth considering including Kraken’s XBT-USD pair, as it often deviates significantly from other exchange’s prices due to the difference in liquidity. The chart below shows that Kraken’s XBT-USD pair can differ significantly from Bitstamp’s BTC-USD pair, with an arbitrage trader making a risk-free return from buying on the exchange with the lower price and selling on the exchange with the higher price.
The difference between Kraken’s XBT-USD and Bitstamp’s BTC-USD
Kraken also offers dark pools, which allow you to make an order that is hidden from public view. Dark pools are offered for both bitcoin and ether, allowing traders to place large order sizes that may otherwise move the market and be matched with similar orders at potentially better prices; it is important to note, however, that dark pools incur an additional fee. You can execute these orders in the intermediate and advanced tabs in the trading subsection.
You can select orders using the dark pool in the intermediate or advanced tabs on the new order page.
As with Bitstamp, wash trading and the faking of volume are not suggested to be problems for Kraken, highlighted in a report from the Blockchain Transparency Institute. The researchers found no evidence of wash trading, as reported volumes closely matched the volumes uncovered by the report. However, this ranking is subject to change, and updated figures will be released sometime in September 2018.
Kraken is one of a handful of Bitcoin exchanges where evidence of wash trading was not uncovered.
Kraken made its mark in the cryptocurrency scene early on, with the discovery of a flaw in the Namecoin protocol in October 2013, leading to the developers fixing the fault. While the altcoin was listed on the platform after the vulnerability was addressed, namecoin (NMC) was removed later on due to a downward spiral in trading volumes.
Kraken’s reputation has also benefited from its foresight and commitment to the long term, as highlighted by the 2014 scare around transaction malleability, where users could change the transaction ID (TXID) within a short window of opportunity and under certain conditions.
Fortunately for Kraken customers, the exchange was unaffected by this “bug” as it had foreseen the troubles that would come with relying solely on transaction IDs to track bitcoin transfers, and had developed a more robust accounting system.
Around the same time, Mt. Gox was dealing with this issue of mutated TXIDs and had no other way of tracking its customers’ incoming bitcoin transactions. By tracking bitcoin transfers with a variety of information, such as transaction size, time and recipient data, Kraken solidified its reputation among Bitcoiners by demonstrating an intimate understanding of the Bitcoin protocol.
Moreover, the exchange was also enlisted to help recover the stolen bitcoins from Mt. Gox, and claims can still be made through Kraken’s platform. The trustee in charge of Mt. Gox’s case chose Kraken because of its proven operating history and resistance to hacks.
Kraken was also instrumental in forming the Japan Authority of Digital Assets (JADA), the first Bitcoin regulatory body with government backing. Similarly, in the U.S., Kraken was an important player in the formation of the Digital Asset Transfer Authority (DATA), a self-regulatory authority for the cryptocurrency industry. Furthermore, as a testament to its position as an industry-leading exchange, Kraken was one of the first exchanges to be added to the Bloomberg terminal to track the price of bitcoin.
Over the years, Kraken has also been active in the area of mergers and acquisitions, with the exchange acquiring four crypto-focused businesses in 2016 and 2017. In 2016, Kraken took over American exchanges Coinsetter and Glidera, Canadian exchange Cavirtex, as well as Dutch exchange CleverCoin. Following this, during March 2017, the charting site Cryptowatch also fell under the ownership of the exchange.
The exchange’s reputation is boosted by recognition from leading business journals. The exchange was nominated as one of the 10 most promising blockchain startups by Great Wall of Numbers author Tim Swanson in 2014, appearing in Business Insider. Also, before its launch, Kraken was named as one of the most important Bitcoin companies by Upstart Business Journal.
Fidor Bank, a financial institution regulated by the German financial regulator BaFin, is Kraken’s partner bank; the cooperation started in October 2013. Kraken can be thought of as a eurocentric exchange, but the platform has gradually widened its reach, later adding USD, CAD and JPY as supported fiat currencies.
U.S. customers have not always had it easy using Kraken. The exchange withdrew from the American market in 2014 but later returned by partnering with PayCash to offer USD deposits. GBP deposits and withdrawals were available previously, but this feature has been withdrawn and may be added again at a later date.
Kraken is one of the biggest exchanges that list Tether, and you can trade this U.S. dollar–pegged cryptocurrency using the exchange, which could prove useful if the fears surrounding the stablecoin ever boil to the surface.
In the event of a Tether breakdown, you could margin short USDT-USD as its peg breaks. Alternatively, if you believe that Tether is bona fide, you could provide market liquidity by buying below the peg when Tether’s value drifts below $1.00. However, in the case that Tether does implode, Kraken might be affected severely in the short term, but since it is not dependant on Tether entirely, it should be well placed to survive any “cryptopocalypse” related to the stablecoin.
Kraken’s interface is quite basic but does show the spread between bids and asks as well as the order depth. You cannot trade directly from the charts page on Kraken, though, and you cannot apply technical analysis within the site’s interface. Unlike some other exchanges, there is no SMS functionality for price alerts.
The spread and order book depth can be shown within Kraken’s trading interface, but no technical analysis.
You can also link your Kraken account with Cryptowatch to trade directly from the charting website and apply technical indicators such as MACD and the Parabolic SAR.
To apply technical analysis to Kraken pairs and trade from your account, you can use Cryptowatch, shown above.
Those trading with bots can take advantage of Kraken’s APIs, with Thrasher as one example of a trading bot that you can utilize in conjunction with Kraken.
The fees on Kraken depend on a variety of factors, including the total cost of your order, the currency pair you are trading, your 30-day trading volume and whether your order is maker or taker. Moreover, if you are margin trading, two further fees are applicable — opening fee and rollover fee.
If you want to place a maker order, which provides liquidity, you can use the Post Limit Order checkbox on the New Order page, and the fees range from 0 to 0.16 percent. On the other hand, taker orders take liquidity from the market as your order will be matched immediately with another in the order book. The fees for taker orders range from as low as 0.10 percent to 0.26 percent.
It is important to note that Tether trades do no count toward your 30-day trading volume. The home screen indicates what fee you will pay and what fee you can expect if your trading volume rises to a specific amount.
Unlike Bitstamp, withdrawing cryptocurrency comes with a fee that is dependant on which cryptocurrency you want to withdraw; for instance, the fee is 0.0005 BTC for bitcoin, 0.005 ETH for ether and 0.001 LTC for litecoin.
Kraken has regularly added new coins to its platform, with the most recent being bitcoin cash in August 2017. The platform supports many ERC20 tokens, like REP, ICN and MLN, along with privacy-focused coins like monero and zcash. Favorites of seasoned crypto-traders, like dogecoin, bitcoin and Stellar, are also available. Two coins that were traded on Kraken but are no longer available are Namecoin and VEN, a centralized digital currency founded in 2007 and backed by a basket of currencies, commodities and carbon futures.
Newer altcoins like Cardano, Nano and Tron are not yet supported by Kraken, and bitcoin cash was the last Bitcoin fork that was added; it is not surprising that this established exchange is not trying to cash in off of the fork mania over the past year. Customers and developer teams can request new additions to Kraken’s platform on the support subpage and then click on Request a Feature; its team has stated many times that it will not announce new additions before they are listed in order to prevent market manipulation.
Powell recently highlighted that the exchange does not have any listing fees, which helps to reduce the problems of moral hazard frequently associated with the cryptocurrency exchange market, and also suggests the company adds coins based on merit, not on the depth of their founders’ pockets.
Kraken is somewhere in the middle of the scale of coverage of the crypto market amongst the largest exchanges; while more altcoins are on offer as compared to platforms like Bitstamp and Coinbase, it does not offer as many altcoins as Bittrex, Binance, Poloniex or Huobi.
There are five tiers of verification on the Kraken platform, named Tier 0 to 4 respectively. Tier 0 permits you to only get a feel for the platform and does not allow any trades, deposits or withdrawals. It is only necessary to submit an email address for Tier 0 accounts.
Next, Tier 1 permits you to trade solely in digital currencies, restricting the use of fiat currencies for deposits or withdrawals, but you can withdraw up to $2,500 per day and $20,000 per month. For Tier 1, you have to submit your full name, date of birth, country and telephone number.
Tier 2 eases the restrictions on fiat currencies, allowing you to withdraw $2,000 per day and $10,000 per month, depending on which country you are located in. You must provide your address to be accepted at this tier. Both Tier 1 and 2 can be verified within an hour, with the latter increasing the daily withdrawal limit for cryptocurrencies ($5,000) but halving the monthly withdrawal limit for cryptocurrencies ($10,000) to account for the introduction of fiat currencies.
Tier 3 is the same as Tier 2, except that funding limits are much higher and you must provide proof of identification and proof of your address.
Finally, Tier 4 is probably only useful to you if you are a high-net-worth individual, as the funding limits for Tier 3 are already pretty high (withdrawals allowed up to $25,000 per day and $200,000 per month, for instance). In this case, you must complete and sign an application form as well as KYC documents, which will enable you to raise your deposit/withdrawal limits to an even higher level. Verification for Tiers 3 and 4 may take anywhere between one to five days, as it is not automated like for the lower tiers.
Powell has previously indicated that the exchange exists to “first and foremost … provide a market for spot, deliverable bitcoin” and that “advanced features for traders, like margin, are secondary” and could be removed if the market becomes too volatile.
Nevertheless, Kraken is one of the best places to margin trade and has offered this feature since May 2015. Margin trading allows you to amplify your gains (as well as losses), with Kraken offering 5:1 leverage for pairs like BTC-EUR and ETH-XBT, while other pairs such as XMR-EUR and USDT-USD offer a lower leverage of 2:1.
The margin feature is useful for advanced traders, who can borrow funds to open a position bigger than their account balance and potentially increase their profits if the market moves in their favor. The table below displays the pairs that support margin trading and the leverages you can use with these tickers. EUR margin pairs are not available to residents of the U.S. states of NH, TX, and WA.
While Kraken does not offer extremely high leveraged trades, like BitMEX, which allows you to use a margin of 100:1, it serves as an ideal place to start margin trading if you haven’t done so before, providing an opportunity to get to grips with leveraged trading.
A variety of orders is available, allowing you to be flexible with your trades and how much attention you place on the crypto market. For instance, advanced orders such as stop losses and take profits are available. The more-vanilla orders like market and limit orders are also present for the novice trader. These various order types can be used to adjust to the market, allowing you to be more productive with your trading.
Trading with margin on Kraken. Select your desired leverage on the right-hand side.
We cannot talk about Kraken and its history without talking about the trading engine. There was a time when getting an order filled while margin trading on Kraken was a very frustrating exercise. Many have complained about the lack of effectiveness of the trading engine and how, in its worst performing times, it has caused traders to lose money through no fault of their own, where orders were not executed when they were supposed to be.
Some customers were refunded partially with Kraken Fee Credits, so traders can be assured somewhat that if such losses are made due to the fault of the trading engine, they will get some compensation; however, the easier choice many sought was to switch to a platform with a better trading engine.
The problem became exacerbated during the crypto mania toward the end of 2017. Kraken had to revamp its trading engine to keep up with demand. In a post from January 2018, the company announced that a new, more scalable trading engine had been put into place. The engine does work much better now, and a recent blog post explained that the trading engine will be updated and maintained frequently.
Kraken is an all-rounder: it has margin trading, a variety of security features and fairly wide support for different cryptocurrencies, providing most traders with enough markets to keep them entertained.
Furthermore, its reputation is excellent, emerging initially as an alternative to Mt. Gox to assuming the role of a leader in the cryptocurrency exchange sector. Kraken’s hand in discovering and correcting a fault in Namecoin’s protocol and its reluctance to add the myriad of Bitcoin forks mean that customers can be confident the exchange will do their due diligence before adding more cryptocurrencies.
The platform has a few minor drawbacks. U.S. customers may not be served well by a company that gives the middle finger to certain regulatory bodies in the States, such as the NYFDS, which could prompt further action by American regulators in the near future. The trading interface is quite bland, but the integration with Cryptowatch more than makes up for this. SMS price alerts would also be a welcome addition. Providing a higher leverage for margin trading could also be beneficial for the platform to take a bite out of BitMEX’s market share. Also, for beginner traders, the site may be a bit complicated to use to its full extent.
Luckily, when making a new order, you can choose from beginner, intermediate or advanced setups and put in a relevant order. For intermediate or advanced traders, you won’t get much better than Kraken, and if so, it will only be a marginal improvement, i.e., higher margins (BitMEX) or lower withdrawal fees for bitcoin (Bitstamp).
This article originally appeared on Bitcoin Magazine.
Altcoins may come and go; hacks may challenge exchanges; mainstream financial advisors might not get it — but even in the face of a protocol bug, Bitcoin perseveres and develops. Here are this week’s top stories from Bitcoin Magazine.
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For well over a year, versions of Bitcoin Core — Bitcoin’s leading software implementation — contained a severe software bug. The bug was fixed with Bitcoin Core 0.16.3 (and 0.17.0rc4), released this week, and the status of the Bitcoin network now appears to be safe, with no harm done. The Bitcoin Core project has since released a full disclosure report, revealing that the bug was even worse than previously thought.
Our technical editor, Aaron Van Wirdum, takes a look at the good, the bad and the ugly details of the bug that didn’t take down Bitcoin.
Innosilicon claims to have a new ASIC miner for bitcoin — the T3 — in the works that will outperform any current hardware in speed, profitability and efficiency. Purportedly consuming only 44 watts of power per tera hash (44W/TH), the T3 could become the most energy-efficient miner on the market when it is released.
Poloniex has announced its intention to drop 8 altcoins from its trading platform: BitcoinDark (BTCD), Bitmark (BTM), Einsteinium, (EMC2), Gridcoin (GRC), NeosCoin (NEOS), PotCoin (POT), VeriCoin (VRC) and BitcoinPlus (XBC). A spokesperson from Circle, the parent company of Poloniex, told Bitcoin Magazine that the coins were delisted in keeping with guidelines spelled out in Circle’s Asset Framework.
Another altcoin, Verge, comes under the privacy microscope in this month’s ongoing series about privacy coins. Check out the reasons why it’s not really as private as we’d like it to be.
The same week that a study was released, detailing the ongoing trouble that Japanese exchanges are experiencing with cryptocurrency thefts, another major exchange announced that is had been hacked. Japanese exchange Zaif was drained of 6.7 billion yen ($60 million USD) worth of company and user funds. The three virtual currencies stolen include bitcoin, monacoin and bitcoin cash. Of those, $37.8 million were in bitcoin funds (5,966 BTC).
Financial advisors should be willing and able to discuss bitcoin and cryptocurrencies with their clients in the same way that they discuss other alternative investments such as gold, hedge funds and real estate investment trusts. But many of them simply don’t. In this op ed, Eric C. Jansen, the founder, president and chief investment officer at AspenCross Wealth Management, looks at some of the reasons why this is the case and why it should change.
This article originally appeared on Bitcoin Magazine.
Industry buzz surrounded Ethereum this week as community members await the next stage of the coin’s development. The protocol also served as the jumping-off point for a new fully regulated stablecoin.
Also in regulation, a New York judge issued a ruling this week that, if held up by a jury in court, could set a legal precedent for ICOs as securities; in other courtroom drama, the space’s longest running suit — between two of its biggest players — draws to an undisclosed close.
All the while, institutional-grade products and services continute to come to light.
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Following November 2018’s DevCon 4 in Prague, Czech Republic, Ethereum will be due for an upgrade. Constantinople, as the hard fork is called, will implement five Ethereum Improvement Proposals (EIPs), introducing such changes as a a revamped gas scheme for transactions and reduced block rewards. To the common user, these EIPs are unlikely to cause too many noticeable changes, but they will give developers more creative and technical leeway when building DApps on Ethereum’s Virtual Machine.
Winklevoss-owned Gemini exchanged launched a stablecoin this week built on Ethereum’s ERC-20 standard. Endogenous to the exchange, which is fully regulated under New York’s Bit Liscense, GeminiUSD (GUSD) was dropped without prior disclosure or media priming. The same day, settlement platform Paxos released its own stablecoin, the Paxos Standard (PAX).
Morgan Stanley is reportedly working toward a way into the the cryptocurremcy market. The legacy financial institution has been developing a institutional-grade bitcoin derivative that is tied to futures prices, a source close to the matter told Bloomberg this week. While the product is ready to go to market, Morgan Stanley is waiting to launch it until investor demand increases.
Cryptocurrency company BitGo announced a service this week that could ease instituional access to the crypto market, upon receiving approval from regulators in Montana to operate cryptocurrency custodial services. The custody, which must endure a waiting period before it goes live, will leverage BitGo’s wallet service to manage funds for institutional investors.
A N.Y. State judge issued a ruling this week that, if upheld in court, could set a defining precedent for ICO regulation going forward. In his decision, the judge found that two ICOs were security offerings, arguing that the founder’s simply calling them currencies didn’t free them of this classification.
Ripple and R3 have finally settled their year-long legal battle. The blockchain companies brokered a settlement after R3’s original suit and Ripple’s countersuit saw the two cycle through three courts in three states. The terms of the settlement are being kept under wraps.
This article originally appeared on Bitcoin Magazine.
A handful of projects brought their tech to life this week, introducing new payment systems and coins to the industry’s offerings. Meanwhile, Bitcoin’s Lightning Network makes headway for the dev community, and one of crypto’s older and more respected exchanges (arguably) takes a step against the space’s principles.
Finally, in a spurious game of he-said-she-said, a report from Business Insider, which was in turn picked up by various outlets, gets blasted by Goldman Sachs as fake news.
IBM launched its much-anticipated payment network on Stellar’s blockchain this week. Like Ripple, the protocol intends to give financial institutions a fiat-to-crypto bridge to streamline cross-border payments.
“IBM’s implementation of the Stellar protocol has the potential to change the way money is moved around the world, helping to drastically improve international transactions and advancing financial inclusion in developing nations,” Stellar Co-founder Jed McCaleb told Bitcoin Magazine.
In its own corner of influence, the little-known stablecoin project Kowala launched the alpha version of its mainnet this week. While not as famous as its fiat-backed competitors Tether and TrueUSD, Kowala by no means takes a back seat to everyone. Popular hardware wallet provider Ledger, for example, is integrating Kowala’s kUSD into its models, making Kowala the first stablecoin to find support from a hardware wallet.
Aaron van Wirdum traveled to Berlin last week to cover the third installment in the Lightning Hackdays series. The gathering was reminiscent of those early Bitcoin conferences and Meetups: makeshift, structureless, but by no means lacking in energy and ingenuity. Among enthusiastic talks and plenty of brainstorming, a slew of intuitive projects were showcased, including a Lightning-powered candy dispenser and a Lightning-rendered 16-bit video game.
ShapeShift is rolling out a new membership program, one that will require know-your-customer (KYC). ShapeShift Membership, as it’s called, will require users to submit “basic personal details” in return for higher trading limits and lower fees. Optional for now, the program will reportedly be mandatory later this year. Andreas Antonopoulos expressed his “disappointment” in the news, tweeting that it “[shows] that any centralized entity will be pushed in that direction.”
Media outlets also jumped on a story this week that reported the untimely fate of Goldman Sachs’s crypto trading desk. Quoting anonymous sources, Business Insider broke the false report, claiming that Goldman Sachs was nixing plans to establish the trading desk. The next day, September 6, 2018, CFO Martin Chavez decried the report as “fake news” at TechCrunch’s Disrupt conference.
Many people in the mainstream community often regard Bitcoin as an anonymous currency, and while privacy was one of Satoshi Nakamoto’s goals when he invented the coin, the feature hasn’t held up. With the right know-how, the wrong user (we call them “spies”) can decode a user’s IP address from their wallet’s public address. Luckily, there are half a dozen or so promising projects that are dedicating their time to enhancing privacy and frustrating attempts to deanonymize network users. In this month’s cover story, we take a look at these projects, one by one, to see how they stack up and to measure their contribution to the ecosystem.
This article originally appeared on Bitcoin Magazine.
In this guide, we explore Bitstamp and its journey from humble beginnings seven years ago to becoming one of the most popular cryptocurrency exchanges in the world. We’ll also look at the various features of its platform, chiefly trading and acquiring cryptocurrency.
Operating since: August 2011
Location: London, Luxembourg, Slovenia, U.S.
Fiat pairs supported: USD, EUR
Notable cryptocurrencies supported: BTC, ETH, LTC, BCH, XRP
Countries served: Worldwide
Account verification: Proof of identity and address
Funding options: SEPA bank transfer, cryptocurrency, debit/credit card, international bank transfer, AstroPay
Withdrawal options: SEPA bank transfer, cryptocurrency, gold, international bank transfer
Fee structure: Scaled at various levels from 0.25 percent for under $20,000, to 0.10 percent for over $20 million.
On August 22, 2018, Bitstamp celebrated its seventh year in operation as one of the largest bitcoin exchanges in the world. This anniversary makes it the longest-running bitcoin exchange in a sector of the crypto-economy plagued by hacks and exit scams. One of the most notable of these, Mt. Gox, was one of Bitstamp’s first competitors.
Started by Nejc Kodrič and Damijan Merlak in August 2011, the company’s first base was in a Slovenian garage with just a server, a couple of laptops and a thousand euros in capital.
Despite these humble beginnings, Bitstamp has grown into one of the world’s leading bitcoin exchanges, one that has played pioneer to a number of exchange security features and technical standards.
For example, Bitstamp was one of the first exchanges to implement multi-signature technology for its hot wallet. It was also an early adopter of Bitcoin’s SegWit soft fork for lower fees in 2017, and it instituted one of the first insurance funds, secured in cold storage, to reimburse its customers in the event of a hack.
After bouncing back from a theft of 19,000 bitcoins in January 2015, Bitstamp secured its status as a regulated exchange after it received a payment institution license from Luxembourg just over one year later. The license allows it to operate in any of the EU’s 28 countries thanks to the Union’s Single Market policy.
A great security feature of Bitstamp is that the warning to setup two-factor authentication is displayed on the account balances page as well as when you first sign up. You must also reset your password on the first log in.
Another encouraging aspect of Bitstamp is that the exchange’s internal processes, which includes IT infrastructure and data protection, are audited annually by one of the Big Four accounting firms.
All customer data is protected by using PGP for any uploaded documents, meaning that, even if hackers gain access to Bitstamp’s servers, the sensitive data is encrypted. Connections to their server are encrypted too, so make sure that you look for the green padlock in the URL tab of your browser when visiting the site.
Following the 2015 hack, Bitstamps hot wallets that hold customer funds are now multi-signature, meaning that an attacker would have to dupe more than one employee with a phishing attack, as multiple staff members will need to sign with their key to validate transactions (ote that the 2015 hack occured after a phishing attack on just one of Bitstamp’s staff members).
Bitstamp is one of the largest exchanges on the market, so users are always able to buy and sell cryptocurrencies with no hassle and without dramatically pushing the price up or down due to slippage.
The majority of the volume on Bitstamp, unsurprisingly, goes toward bitcoin, with ether a runner up, taking around 10 percent of the volume in recent days.
While wash trading and fake volume are valid concerns within the wider crypto exchange market, a recent report from the Blockchain Transparency Institute found that Bitstamp’s reported volume was closely aligned with the researchers’ more accurate estimation of the true volume. Another update to the rankings is expected in September 2018.
Bitstamp is one of a handful of bitcoin exchanges where evidence of wash trading was not uncovered.
As the longest-running exchange for bitcoin, Bitstamp has a pretty solid reputation. The fact that it is regulated as a payment institution in the EU also gives the exchange credibility and, in the event regulations are tightened, Bitstamp should be well-placed to overcome any difficulties.
In June 2014, Bitstamp was awarded the Best Virtual Currency Startup at the Europas, placing above U.K.-based bitcoin exchange Coinfloor, peer-to-peer marketplace Localbitcoins and blockchain analytics firm Elliptic.
Bitstamp allows you to convert fiat, namely EUR and USD, into the most popular cryptocurrencies and vice versa. All of the available cryptocurrencies are traded against BTC, EUR and USD.
If you are located in the European Union, SEPA bank transfers should take anywhere between 24 hours to three business days. International bank transfers will be much slower, in the range of two to five business days. SEPA transfers are free of charge; however, a small fee applies to international bank deposits of 0.05 percent.
The bank handling fiat transactions for Bitstamp is known as Gorenjska banka, a Slovenian financial institution founded in 1955. Gorenjska operates over a wide range of operations, including banking and financial services for individuals and corporations, along with a presence in the rental market for safety deposit boxes, insurance, real estate and forex markets. As Slovenia falls under the EU’s Single Market, Gorenjska follows the same standards as, and is regulated in a similar fashion to, German or French banks.
Bitstamp is one of the few major exchanges that does not rely on Tether. Whether or not the stablecoin is backed up by sufficient USD reserves is a story for another day, but there has been a lot of debate about whether USDT is genuinely backed up by U.S. dollars or whether it could be an elaborate ploy to manipulate the markets.
By not relying on Tether and not holding Tether reserves, Bitstamp will survive in the (unlikely) event of a market-wide panic should Tether collapse.
Crypto advocates and gold bugs often overlap, nevertheless, there are some that believe that crypto will make gold as a store of value obsolete. Others see the two assets as complementary.
Bitstamp’s gold withdrawal feature makes it truly unique. The feature was introduced in January 2016, with the precious metal sourced from the well-established firm Moro & Kunst d.o.o. To withdraw gold, you must be an EU resident and have a USD balance in your account. The rate is fixed at time of withdrawal and customers can expect to receive their gold bars in two to five business days.
The trading interface on Bitstamp is eye-catching and provides detailed information about markets, such as the order book and market depth, and traders can apply technical indicators such as Bollinger bands.
In combination with a technical analysis, SMS price alerts may be a useful alternative to limit orders and market orders. For instance, you may be waiting for a breakout above a particular level and want to assess the situation if the breakout occurs instead of buying or selling once that level is hit. Using SMS price alerts, we can set these alerts at key resistances/supports and evaluate the situation as it unfolds before committing to a purchase or sale of cryptocurrency.
Using Bitstamp’s API feature, advanced traders can set up trading bots to automatically execute trades. For example, Stefan van As introduced the Nefertiti bot in 2017 which is compatible with Bitstamp, as well as the open-source trading bot Gekko. If you are well-versed in programming, then you might even be able to write your own trading bots using the functions here.
Withdrawing crypto is free, unlike some exchanges like HitBTC which charge for both deposits and withdrawals. Other reputable exchanges often charge for withdrawals of cryptocurrency. As a crypto appreciates or depreciates, these withdrawal fees are not usually changed in line with price changes.
Fees are also relatively low for bank transfers: €0.09 for SEPA transfers for those in Europe, which is basically the same as Kraken.
Depending on your cumulative 30-day volume, fees on trading pairs when buying or selling in the market start at 0.25 percent declining to 0.10 percent if your 30-day volume exceeds $20 million, again similar to Kraken.
Only bitcoin, bitcoin cash, litecoin, ripple and ether are offered, which may be an indicator that Bitstamp is acting cautiously by not adding every coin under the sun.
Bitstamp also stopped adding bitcoin fork coins such as bitcoin gold and bitcoin private, after adding bitcoin cash. Thus, for altcoin traders, Bitstamp is probably not the exchange to go to, as many opportunities are not available. Binance, Bittrex and Poloniex can better serve altcoin traders, with a wider variety and more potential opportunities to profit.
The fact that the exchange requires you to identify yourself and provide a proof of address may be a downside for some. In this case, decentralized exchanges may be a better option, instead of submitting your identity and address.
The exchange has been working with Onfido, a KYC technology provider, since February 2018, to reduce and automate the time needed for verification.
Unlike other exchanges, there is only one verification level, so once you have submitted your documents, you will not need to do anything further, and you can expect the process to be completed within 48 hours. However, during the crypto frenzy toward the end of 2017, the verification time was delayed as demand far exceeded Bitstamp’s ability to take on new customers, and the exchange temporarily halted new sign-ups.
With platforms such as Kraken and BitMEX, users can leverage their positions to increase profit potential for their trades. WIth Bitstamp, there is no margin trading.
While some advanced traders might miss this feature, the fact that there is no margin trading may be a slight positive aspect for some who are not accustomed to taking such risky trades, and beginner/amateur traders may want to practice on Bitstamp using market/limit orders to buy/sell cryptos before trading with leverage.
Market and instant orders both buy/sell immediately at the best available price, and they differ only in that you can determine the quantity you wish to purchase with market orders. Limit orders allow you to set a level, or “limit,” you want to enter and exit a trade and is executed automatically once the market reaches the limit. Finally, stop orders allow you to limit your losses in case the market moves against you after you buy or sell or if you want to set up a trade to execute a buy/sell on a breakout.
Overall, Bitstamp is a solid bitcoin exchange, ideal for European citizens. Despite not having margin trading, Bitstamp is a good choice for acquiring cryptocurrency due to its reputation, free withdrawals of cryptos and competitive fees. The ability to withdraw in gold is also a useful feature for those cryptocurrency investors who have not yet diversified into precious metals.
Margin trading and the addition of a handful more altcoins that have real-world utility could make this exchange even more potential for taking market share. Similarly, the addition of an autonomous exchange, in which cryptocurrency projects list their own crypto assets autonomously, similar to Huobi’s HADAX exchange, could be used as a preliminary stage before adding new cryptocurrencies to the main exchange.
This article originally appeared on Bitcoin Magazine.
This past week has seen progress in two aspects of Bitcoin: privacy and payments. Attitudes toward blockchain technology are also showing progress as two surveys reveal. And yet, regulation does not necessarily seem to be keeping pace.
Here are some of the stories that we’ve been following at Bitcoin Magazine.
This week, two of our top stories explored recent advancements in Bitcoin development. First, we examined a new protocol that is working toward improving privacy of Bitcoin transactions. Dandelion, a protocol developed by postdoc Giulia Fanti and other researchers from Carnegie Mellon, MIT and the University of Illinois, would effectively neutralize the peer-to-peer analysis that plays a significant role in compromising user identity.
Solving the problem of allowing users to make trustless transactions between lightning addresses and on-chain addresses in either direction, “Submarine Swaps” are now live (though still in early stages of operations). The technology could be a game changer for both Bitcoin lightning and mainnet users, as it would remove the transaction barriers between them.
Two separate studies have found that interest in blockchain technology is on the rise. A PwC global survey discovered that of the corporations surveyed, the number of companies that are using or exploring using blockchain technology is growing, and that there is also an increase in trust among the companies that have heard of the technology.
Meanwhile, the next generation of blockchain entrepreneurs, developers and users is also showing an interest in learning more. A recent survey, commissioned by Coinbase in partnership with Qriously, sampled 675 U.S. students, and it found that students across all majors have an interest in blockchain technology.
Canada’s decision to put off any decisions regarding the regulation of cryptocurrencies and blockchain companies until after the next round of federal elections has been met with mixed reactions. Some see it as a sign that the government is backing away from the strict set of recommendations that were put forward in June of this year. Others are concerned that putting off regulatory clarifications will hamper industry growth in the country.
In Venezuela, the government has ordered all domestic banks to disclose the IP addresses, financial details, transaction amounts and locations of all citizens who access their banking services from outside the country. This move has Bitcoiners concerned that the government is trying to interfere with their ability to use cryptocurrencies for remittances, with particular implications for people using LocalBitcoins to trade their bitcoins for fiat.
This article originally appeared on Bitcoin Magazine.
This week in the industry, we saw the gears of government and regulation grinding, we check in on some mining news and we take a moment to reflect on the state of the market and industry innovation. Here are some of Bitcoin Magazine’s top bitcoin, blockchain and cryptocurrency news stories for the week.
This Wednesday, the United States Securities and Exchange Commission released orders on nine bitcoin exchange traded fund (ETF) proposals. Each of the three orders, like those that preceded them, shot down all of the ETFs in question.
But these decisions, the SEC revealed the next day, are now up for review. This development has offered a glimmer of hope for the industry in its slow-slog toward a bitcoin-backed, exchange-traded product.
In the march toward clearer crypto regulation in the States, exchanges have taken the lead in an attempt to quicken the pace. The Virtual Currency Association, a self-regulatory organization spearheaded by the Winklevosses and their Gemini exchange, added three new members this week. With these latest additions, the VCA continues to work toward its goal of “establishing an industry-sponsored, self-regulatory organization (SRO) to oversee virtual commodity marketplaces,” in advance of a summit to be held this September.
While the U.S. grapples with regulations and oversight for its own virtual currency markets, the Chinese government is looking to siphon its citizens’ access to crypto trading venues. Chinese officials shuttered access to over 120 offshore exchanges this week, an extreme measure to accompany the comprehensive ban it effected on domestic ICOs in September 2017.
Meanwhile in the private sector, WeChat is assisting the government with its crackdown. The number one messaging platform in China purged crypto and blockchain media accounts from its services this week, citing the government’s policies toward ICOs as justification for the bans.
All eyes were on Bitmain this week, as public and media scrutiny continues to pick apart the details of the Chinese mining behemoth’s forthcoming public offering.
After reports surfaced last week claiming that Japanese telecom company Softbank and Chinese internet provider Tencent had invested in Bitmain via a private pre-IPO funding round, a handful of companies came forward this week to deny their involvement.
In a feature article, Bitcoin Magazine’s Colin Harper took a trip to Norway to survey the work of Northern Bitcoin, a German mining company that has taken advantage of the abundance of renewable energy Norway’s fjords produce.
Situated in Lefdal Mine, a defunct mine turned data center in Måløy, the 3,250 miner strong ASIC mining farm operates at nearly half the electricity cost of its competitors and with zero CO2 emissions. It’s a reminder that, with the right infrastructure and a tinge of creativity, bitcoin mining can be more sustainable than its critics suggest.
Ever since Bitcoin developer Sergio Lerner presented compelling evidence on the topic in 2013, the Bitcoin community has assumed that Satoshi Nakamoto mined — and held on to — roughly 1,000,000 bitcoin during the network’s inaugural year. New evidence from Bitmex research, on the other hand, suggests that this figure may be in the ballpark of 600,000-700,000 BTC.
Finally, IOST CEO Jimmy Zhong reminds us of the importance of perspective in times of market anemia. These are the times, Zhong argues, that real growth can be realized, and that those who focus their efforts on development despite the downturn will be better for it when things start to look up again.
“Life is a long journey. We often say that choice is more important than effort. We also need to understand that desire and choices only pull through with persistence. I hope we can have faith in our common choice, the future of technology, the power of market cycles; remain unwavering in the face of swaying market sentiment; make independent and clear-headed judgments; and, together, build something people truly want,” Zhong writes.
This article originally appeared on Bitcoin Magazine.
This week’s top stories include two feature interview: one with Kavita Gupta, founding managing partner at ConsenSys Ventures; and another with electronic dance music DJ Justin Blau (aka DJ 3BLAU) who is launching a decentralized music festival. Bitcoiners have begun moving from Twitter to a new “instance” on Mastodon, the SEC has delayed yet another ETF decision, and some of West Virginia’s overseas service members may be able to vote using a blockchain-based mobile app this November.
Featured stories by Tanzeel Akhtar, Jimmy Aki, Matthew Breen and Colin Harper
ConsenSys, the Ethereum production studio based in the U.S., launched ConsenSys Ventures last year selecting Kavita Gupta to run two funds of $50 million and $100 million. Bitcoin Magazine spoke with Gupta to discuss the launch of project Tachyon and the launch of ConsenSys India.
She spoke about their goal to attract a diverse cohort of up to 15–18 teams, within the accelerator they are offering three tracks: Blockchain for Social Impact track; the Ethereum Project track; and an Open Source, blockchain-agnostic, grant-driven track. Upon completion of the program, they will have a demo day that will be exclusive to the most prominent angel and venture capital investors with expertise and passion for the blockchain technology. Gupta also discusses their technological focus, how they identify projects and teams and how investments are allocated.
The SEC appears to be in no hurry to review the pile of Bitcoin ETF filings it has been accumulating over the past year. Not three weeks since postponing its decision on five other Bitcoin ETFs, the SEC has indicated in a public statement that it will be delaying its decision to approve or reject SolidX Bitcoin Shares until late September. Each rejection or prolonged decision creates more headwind with regulators to secure its first exchange traded fund. Many believe such a listing would open the floodgates for institutional money.
Twitter has become a toxic, corrupt and censored space, in the opinion of a growing number of Bitcoiners. A mix of perceived censorship through shadow banning and lack of serious action to remove the notorious ether giveaway bots have aggravated calls for a decentralized alternative to Twitter.
Enter Mastodon, a distributed social media platform that shares some features with Twitter, plus it includes more granular privacy controls and up to 500 characters available for microblogging. Opendime’s Rodolfo Novak has since gone on to create bitcoinhackers.org, an “instance” on Mastadon, dedicated to Bitcoin maximalists with “no scams, no shitcoin, no impersonation, no begging and no illegal content.”
Bitcoin Magazine interviews Justin Blau, aka DJ 3BLAU, a popular electronic dance music DJ. He chats about how a chance meeting with the Winklevoss brothers started him on his crypto journey. Soon after, he saw the many ways in which blockchain technology could disrupt the music business, which led to him start up the world’s first blockchain-powered music festival coming on October 20, 2018, known as Our Music Festival (OMF).
For the 2018 mid-term elections this November, West Virginia residents that are part of the military and serving overseas will be able to vote using the mobile voting platform, Voatz. The software uses facial recognition to match each user’s “selfie-style video of their face” to their government-issued ID. Once approved, voters will be allowed to cast their ballot on the app. Ballots will then be anonymized and recorded on the blockchain.
This article originally appeared on Bitcoin Magazine.
This past week, we talked to three security experts about how to design smarter and more secure smart contracts. Google is dipping its toe in the blockchain waters by introducing integrations for applications built with Ethereum and Hyperledger. The financial sector got some more love with the Digital Chamber of Commerce’s white paper to help cryptocurrency and ICO markets grow responsibly. Finally, 17 tons of almonds moved from Australia to Germany with real-time tracking and verification on the blockchain.
Featured stories by Jimmy Aki, Colin Harper, Marianne Lehnis and Nick Marinoff
In the most infamous smart contract hack in the industry to date, The DAO, a decentralized venture fund, lost 3.6 million ether in June of 2016, and the fallout of the attack saw Ethereum hard fork to recoup losses.
Bitcoin Magazine talks with security experts Hartej Sawhney, co-founder of Hosho, Dmytro Budorin, CEO of Hacken, and believes that security can slip by the eye of software engineers because they “don’t have a quality assurance (QA) mindset.” Dmytro Budorin, CEO of cybersecurity community Hacken, and Amy Wan, CEO and co-founder of Sagewise, about how comapnies can ensure the security and quality of their smart contracts, as well as the role of the community in holding those companies accountable.
Google is following a similar path taken by Amazon Web Services, Microsoft Azure, and cloud-hosting services offered by Oracle, Huawei and IBM to offer ready-made templates for their ‘blockchain as a service’ offerings.the latest tech giant to offer blockchain technology to its customers.
In an interview with Bitcoin Magazine, Hyperledger’s executive director Brian Behlendorf spoke about Google’s decision and how Hyperledger’s Fabric open-source nature, maturity and flexibility fits in with Google’s strategies.
Blockchains carry the promise of making international money transfers cheaper and faster for all parties involved. Once the technology has proven its speed and scaling abilities, investment banks and international settlements will undoubtedly become increasingly comfortable as transaction partners.
Thomas Levene, founder of Best Blockchain Solutions Consultancy, discusses how major investment banks could make $10 billion in efficiency savings by utilizing blockchain technology and how new, upstart blockchain companies are challenging the status quo.
The Chamber of Digital Commerce’s Token Alliance is producing a new group of guidelines built to help the cryptocurrency and initial coin offering (ICO) markets grow responsibly. Founder Perianne Boring tells Bitcoin Magazine how regulations could introduce legitimacy and protections into a landscape still obscured in popular opinion by skepticism and doubts that are made murkier still by persistent manipulation and fraud.
Released as a whitepaper, the report is entitled “Understanding Digital Tokens: Market Overviews & Guidelines for Policymakers & Practitioners.” The paper specifically pertain to “utility tokens,” which provide users with future access to products or services. In these instances, ICOs will raise money for new blockchain products by offering investors future use of the items being developed (usually at a discounted rate).
Following a successful 2016 trial of blockchain technology in an interbank open account transaction, the Commonwealth Bank of Australia (CBA) has partnered with five international and Australian companies to ship 17 tonnes of almonds from Melbourne, Australia, to Hamburg, Germany, using a new distributed ledger platform built on the Ethereum blockchain.
The shipment made its way to Western Europe in a pioneering experiment that combined a private blockchain, smart contracts and a geotracking Internet of Things (IoT) framework to facilitate end-to-end movement of the almonds. Using the joint solution, the entire process was seamlessly tracked and verified remotely from the point of origin to delivery in real time.
This article originally appeared on Bitcoin Magazine.
ETF’s are back in the news this week with the Winklevoss twins of Gemini getting rejected again, while investment firm Direxion was delayed till September on a final decision. Crypto continues to make inroads into the financially impoverished nation of Venezuela, with Dash now becoming more popular than Bitcoin for black market purchases of basic necessities.
Qtum is the latest blockchain technology company to become available on AWS, making the creation of, and deployment of Qtum developed dApps that much easier. Just north of Qtum headquarters, we see the cryptocurrency exchange Binance continue to grow and expand with a new push into South Korea.
Featured stories by Jimmy Aki and Colin Harper
The United States Securities and Exchange Commission (SEC) has rejected the Winklevosses’ latest attempt to list a bitcoin ETF. After having a proposal rejected last year, they had hoped to secure their Winklevoss Bitcoin Trust on BATS Global Market’s BZX stock exchange, but the June filing was curbed in a 3-1 vote.
The SEC has postponed the review of five Bitcoin ETFs proposed by investment firm Direxion Asset Management, as it needs more time to study the proposal before reaching a final decision, which they say will come on September 21, 2018. The statement reads, “The Commission finds it appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider this proposed rule change. Accordingly, the Commission … designates September 21, 2018, as the date by which the Commission shall either approve or disapprove the proposed rule change.”
The Dash cryptocurrency is establishing itself as one of Venezuela’s most popular cryptocurrencies. Bitcoin may still be king on the international scene, but in South America’s northernmost country, dash is vying for superiority. And, according to Latin American exchange Cryptobuyer, it has all but usurped bitcoin in the region.
Qtum is a hybrid platform which uses the Account Attraction Layer, an interface layer, to merge the strength of Bitcoin’s blockchain with the Ethereum Virtual Machine to build decentralized applications. Designed as a toolkit, the platform uses the proof-of-stake model to reduce the network’s computational difficulty while mitigating and solving scalability. Qtum has now launched its decentralized application (DApp) development platform on Amazon Web Services (AWS). With this launch, AWS users and developers will be able to develop and launch smart contracts using an Amazon Machine Image (AMI), made up of Qtum Core, Solidity and Qmix web IDE.
Binance, the world’s largest cryptocurrency exchange by daily volume, is expanding from its home base in Hong Kong into South Korea. While South Korea is presumed to be the third-largest crypto market after the U.S. and Japan, it hasn’t been a smooth ride for the cryptocurrency exchanges operating there. Bithumb and Coinrail were hacked earlier this year, while tax authorities have raided Coinone on tax evasion allegations. Binance seems to be undeterred by all this, as it has been laying the groundwork for its expansion into South Korea for a while. Last year, the company added Korean language support to its site.
This article originally appeared on Bitcoin Magazine.
When it comes to CI\CD, every component of the business application has equal importance. As the core of any application, the database is one of the most complex components due to the vastness of the data it holds and business rules that are implemented to achieve complex business functionalities. Often, databases lag behind during new releases; to prevent this, database performance monitoring and review needs to happen as early as possible to prevent expensive mistakes. If this is a manual process, it slows down releases as managing multiple database components is time-consuming.
This article will walk you through the process of database performance monitoring, the review of different DB components, and how this process can be automated.
When a change in a code is performed by any team member — regardless of the technology involved — the integrity of all related code must be confirmed to be working per expectations (even in cases where the change is tiny). Understanding how changes to database objects can make an impact on deliverables certainly helps in the database performance monitoring and review process.
Let’s take a look at some important objects and areas in a database that you definitely need to keep track of and how to automate the review process as well.
An enforced, consistent policy for naming conventions will help you automate design changes across multiple environments easily. What’s more, using proper object names for each type of data will avoid confusion. So, for example, tables, views, and materialized views (MVs) should be easily differentiated simply by looking at their name.
Keeping tabs on who has access to what in the database helps to make sure that unwanted access is not granted to just anyone. On occasion, someone may be granted broader permissions (e.g. to check if the code is working fine on another environment), but it’s just as important to remember to revoke these permissions afterward. Failure to stay on top of the roles and permissions of the database could potentially cause security and deployment errors. An updated “inventory” of users and their permissions must be maintained to avoid such issues.
In the era of the cloud, data and databases are often spread out on multiple on-prem and cloud locations. For example, one of your databases may be on Amazon, another may be from a different service provider, and you may have applications or users around the world connecting to your databases and accessing data.
You need to keep control of who, what, and how connections occur to your database. Making sure that connection strings, DB links, users, and applications all have proper permissions and monitoring all activity is essential to completely eliminate any malicious connection source.
Tables and other data-storage structures must be created with precision, ensuring the potential horizontal and vertical growth of the data. A good table design can make sure, for example, that proper primary keys, indexes, foreign keys, and constraints are enforced. Redundant indexes are not created because, rather than improving performance, these will degrade DMLs.
Most of your application’s functionality may be implemented via database procedures, functions, triggers, and packages. A preferable design will have all related functionality packages and all source objects kept together inside a single package as much as possible. In this way, you can be sure which code needs to be reviewed if you decide to make a change. Proper usage of source-code implementation also improves data security by only allowing changes to occur through the procedures; this ensures that no ad hoc changes are allowed.
From DDL to DML, all such operations result in change to your data or data model that may cause big data corruption or security and compliance issues. Hence, it is very important that all operations that make changes to your data are reviewed and properly monitored from the initial design phase to production deployment. You will also need to have proper auditing of transactions as well as maintain a transaction history to track and recover from any unwanted changes.
All important components together build up a very robust database system. However, as there are many, keeping pace with other application components for continuous delivery (CD) becomes extremely difficult due to the complexity of how database objects are integrated together with multiple dependencies. Most importantly, data is the main part that fails on continuous delivery when it is not handled properly. Thus, it is critical that your database review process is in top shape.
Companies are becoming more cloud-centric, managing their data globally over network connections. The increased number of security threats and data breaches has created new challenges for companies and DBAs to meet growing regulatory and compliance needs. Unlike applications, databases face a different risk due to the sensitivity of data. With databases being accessed by many authenticated users, often from around the globe, tracking and automating database changes is crucial.
All database changes, including administrative, DML transactions, or even SELECT statements need to be monitored closely to ensure compliance with any audit and security policies. Using version control and history auditing tools is a sure way to promise that changes are well-documented. Defining roles and permissions and what type of changes can be made by each will further help maintain the integrity of the code.
When your database serves data for multiple applications and people around the world, you need to implement very tight security via rules and policies as well as monitor how data is flowing between multiple systems. You need to properly protect and monitor data in order to identify malicious activities and threats, as vulnerable areas can cause security breaches.
Prevention is the best medicine. Putting the proper measures in place to stop breaches from even happening in the first place, by way of enforcing policies on data changes and integrity, will help keep potential unauthorized changes at bay. If a breach does occur, the ability to stop it, reverse it and alert all relevant teams is crucial.
Monitoring data vulnerability helps companies take early action to protect their mission-critical data. Doing so manually will push back deliverables as well as increase time to market, hence, you need a tool that provides single-window monitoring, configuration, and administration of all security policies being utilized to protect your data.
One such tool from Splunk can help monitor data security via an out-of-box or customizable solution that provides data correlations, searches, and visualizations. Users can obtain real-time security statistics on a database and take actions to enable continuous delivery.
Sometimes, changes need to be pushed to the production database directly, often in cases of emergencies. The result is that lower environments are often not updated, and any updates pushed upwards from development or testing can override the emergency fix. The plague of configuration drift is widespread and can have serious fallout. Automatic drift detection helps prevent these mishaps, directing users to the exact point of change in the production database.
Automation is the key to success in any development environment, and databases should not be left behind. Database performance monitoring and review should also be automated as early as possible because of the complexity associated with database components and the critical role data plays. Using smart DevOps and automation tools, DBAs and developers can be doubly sure that their hard work reaches the market on time.
Cryptocurrency prices were on the rise this past week and we’ve done some analysis to help you make sense of the movement. Amidst this volatility, we saw Stronghold announce a partnership with IBM to launch a new stablecoin on Stellar’s network that is FDIC insured, a first in the space.
As the market matures, blockchain research and development is picking up steam in major universities, driving innovation for the future health of the industry. Speaking of education, congress got serious about understanding this week, holding two full hearings to discuss the technology and how best to understand and make use of it.
In some less savory news, cryptomining malware continues to grow as a popular and profitable way for hackers to make use of your computing resources, but we have some help for you.
Featured stories by Nadav Avital, Colin Harper, Andrew Rossow and Bitcoin Schmitcoin.
Previously, Schmitcoin had discussed the strong possibility for a retest of the low volume spring, noted that the market was beginning the early stages of an inverted head-and-shoulders (H/S) reversal (sometimes called a head-and-shoulders bottom). A couple days ago, shortly after testing the left shoulder of the head-and-shoulders reversal (H/S), the market reacted strongly and bitcoin’s price jumped several hundred dollars.
Both the candle spread and volume were quite high over the daily candles that set the stage for this jump. High volume and large spread following a low volume spring hint toward a potential accumulation characteristic called a “Jump Across the Creek” (JAC). In a trading-range sense, the whole purpose of an accumulation trading range (TR) is to shake out all the sellers so that an asset can be pushed to higher price levels. One characteristic to keep an eye out for: JACs often retrace up to 50% of their movement in a TR characteristic called a “Back Up to the Edge of the Creek” (BUEC). This serves to not only test seller interest but also traps sellers to provide liquidity for the next leg up. The BUEC is a great risk-to-reward for those looking to enter long on the rally.
Stronghold, a cryptocurrency trading platform housed by Stellar, is launching a stablecoin on its parent network’s blockchain in collaboration with IBM. Stronghold USD will be backed with “one-to-one U.S. dollars per coin,” according to an official press release, and held in an account with Nevada-based Prime Trust, the same trust company that banks for the stablecoin TrueUSD. The stablecoin is also purportedly protected by FDIC Insurance, and unlike Tether, Stronghold USD is audited, but the identity of the auditing firm has not been revealed.
The Massachusetts Institute of Technology (MIT) features the oldest and perhaps best-known university-sponsored blockchain development lab in the world. Since 2015, the MIT Media Lab’s Digital Currency Initiative has brought together some of the space’s leading independent developers with MIT faculty to extend the development of such applications as the Lightning Network.
Halfway into 2018, some of the world’s top universities are joining MIT and vetting initiatives of their own. Stanford’s now month-old blockchain R&D lab was launched with a bit of a jump start. Co-directors Dan Boneh and David Mazières have three years of blockchain-focused research and academic papers to set the lab into motion. Both directors are computer science professors at Stanford and have taught courses on blockchain technology since 2015. As these labs begin operating in the background of academia, these professors can take the work they’ve done in the classroom and work toward tangible developments.
On July 18, 2018, Congress held two full hearings to take a closer look at why and how digital assets, including cryptocurrencies, are impacting U.S. marketplaces. Some might find it odd to see the House Committee on Agriculture represented at a hearing on digital assets and their related technologies. But Chairman Michael Conaway explained that they have a vested interest in shaping and constructing the definition of a security because it directly impacts the definition of a commodity. Working in tandem, both Chairman Conaway and Ranking Member Collin Peterson identified five main goals for clarifying blockchain industry regulation:
Promoting a safe, efficient and transparent tokens market;
Proper regulation doesn’t always mean intrusive regulation;
Identifying whether tokens are securities;
Parsing through whether our current laws are appropriate to apply; and
Ensuring enough oversight to help the space grow responsibly.
At the end of the hearings, Congress seemed to be very receptive to the idea of this new technology, but it is still concerned about ensuring that it is properly regulated where appropriate.
The latest fad in hacking these days is cryptomining, which takes the typically unobtrusive activity and allows nefarious actors to hijack your computer and make a lot of money fast. With the sheer number of cryptocurrencies available to mine, it is becoming a popular choice for attackers. The technique essentially involves an attacker taking advantage of another person’s computer and using its CPU power to mine for cryptocurrency. If the malware is configured to consume a large percentage of CPU power, it can prevent the CPU from doing other tasks and effectively deny the user access to the machine and its application.
Going back to the early days of Bitcoin, we look at the contributions of Nick Szabo to smart contracts and Bit Gold. Decentralizing gets another boost by Augur in the predictions marketplace with the launch of their platform. Then we see a very real world example of cryptocurrency solving a real need in Venezuela to avoid their collapsing currency and allow people to buy the goods they need to survive. Finally, we see a conventional exchange, the CBOE, talking to the SEC about getting a bitcoin ETF license, which would be a real milestone in terms of bringing cryptocurrency even closer to the masses as an investment vehicle.
Featured stories by Jimmy Aki, Colin Harper and Aaron van Wirdum
Early cypherpunk Nick Szabo had been researching decentralized financial solutions in the mid-1990s and came to propose what he is perhaps best known for today: smart contracts. These (then-hypothetical) computer protocols could digitally facilitate, verify and enforce the negotiation or performance of a contract, ideally without the need of any third party.
The latest installment in Aaron van Wirdum’s Genesis Files series looks at the contributions of Szabo and recounts how he proposed solutions to some of the problems that Bitcoin would eventually solve.
Blockchain-based predictions platform Augur has opened to the general public, becoming the “world’s first” decentralized prediction-market platform. It was created by the Forecast Foundation, a not-for-profit corporation whose goal is to build “open-source, public forecasting tools.”
Prediction markets have long been dominated by the likes of Paddy Power and DraftKings, which are centrally owned, operated and regulated. This centralization causes all kinds of problems, such as restrictions for users in certain regions, higher associated costs to use and limitations on the types of markets that users could create. A key differentiator for Augur is its global and decentralized nature.
On July 1, 2018, Venezuelan citizen Héctor received 0.5 nano, roughly worth $1.80 USD. The amount seems trivial, but it is almost a month’s salary in the impoverished nation and more than he had made the previous month. This inspired him to write a post celebrating his newfound wealth on the r/nanocurrency subreddit.
In an interview with Bitcoin Magazine, Héctor describes the day-to-day economic circumstances in Venezuela and tells how cryptocurrencies are giving people like him hope.
The United States Securities and Exchange Commission (SEC) is examining an application from the Chicago Board Options Exchange (CBOE) Global Markets which, if approved, could grant the company a coveted bitcoin ETF license and bring new waves of institutional investors to the bitcoin arena.
The cryptocurrency space remains largely unmonitored, and the SEC has sought to take a firm stance to ensure consumer protection and safety. After much debate and speculation, however, officials recently decided that both bitcoin and Ethereum — despite its early pre-sale (now ICO) status — were too decentralized to be considered securities and could not be regulated by the organization.
Coinbase continues to grow with their new high-end investment product Coinbase Custody, while Binance had to run a system update following some issues with its Syscoin wallet API.
On the topic of regulation, the EU has put out another report on virtual currencies warning officials not to ignore them but treat them like any other financial instrument; the SEC is reaching out to seek comments on a new ETF; and Ripple finds itself on the wrong end of yet another lawsuit claiming that its XRP token is a security.
Featured stories by Jimmy Aki, Colin Harper and Nick Marinoff
Coinbase launched Coinbase Custody this week, the latest in their suite of products. This new service is catered toward institutional investors and big spenders, offering its clients cryptocurrency cold storage options, “institutional-grade broker-dealer” services and asset coverage.
The services will only be available to American and European institutions, though the company hopes to expand its offering into Asian markets as well.
The EU’s Policy Department for Economic, Scientific and Quality of Life Policies released a report entitled “Virtual currencies and central banks monetary policy: challenges ahead.”
In evaluating cryptocurrencies as a novel, potentially disruptive technology, the report ultimately concludes that “[policy] makers and regulators should not ignore VCs, nor should they attempt to ban them … VCs should be treated by regulators as any other financial instrument, proportionally to their market importance, complexity, and associated risks.”
The Securities and Exchange Commission (SEC) is seeking comments on another bitcoin-based exchange-traded fund (ETF). The proposal in question calls for the listing and trading of SolidX bitcoin shares, and stems from the VanEck SolidX Bitcoin Trust, which states it will invest in “bitcoin only.”
The SEC is now asking for comments on the Trust’s newly proposed regulatory changes from “interested persons.” Though several companies have tried to list bitcoin ETFs before, concerns regarding the cryptocurrency’s liquidity and its consistent price swings have led to rising concern amongst SEC representatives, which can make the listing process difficult or long-winded.
On July 3, 2018, Binance suspended all trading and withdrawal services due to “irregular” Syscoin (SYS) trades carried out “from a number of API users.” The exchange has since resumed all activities. Questions remain, however, as to the root cause of the problem.
While the price of Syscoin had hovered around 0.00004 BTC, an order for 1 SYS in exchange for 96 BTC was placed and completed on Binance. This trade sent the market into overdrive as users assumed that the exchange or the Syscoin protocol had been compromised — though Syscoin insists that the chain was never compromised or hacked.
Ripple is staring down the barrel of yet another securities lawsuit — its third one this year. The suit’s plaintiff, David Oconer, is demanding that the court classify XRP as a security, while also seeking relief for the “damages, recession” that he incurred from investing in the coin.
The suit argues that Ripple never registered with California’s Commissioner of Corporations for qualification, a mandatory registration for any securities offering in the state. The plaintiff alleges that Ripple’s sale of XRP in a “never-ending initial coin offering” resembles that of an IPO, with the currency itself acting like a dividend for the ROI its promotion promised to investors.
This week, the U.S. Department of Justice and other law enforcement agencies banded together to bring down some bad actors on the dark web. EOS is undergoing some growing pains with the launch of its network, exposing the trials and tribulations of an all-too-centralized governance model.
It wasn’t all unsavory news, though. A new $300 million crypto fund was launched by Andreessen Horowitz to help grow the ecosystem, and Coinbase’s CEO started a cryptocurrency charity fund that already has $1 million to work with.
We witnessed some notable technological advancements this week as well with the announcement of the ERC-1155 token standard for Ethereum. The new standard will build on and enhance ERC-721’s functionality, the same standard used to tokenize non-fungible assets like CryptoKitties.
Featured stories by Jimmy Aki, Colin Harper, Erik Kuebler and Nick Marinoff.
The U.S. Department of Justice, in cooperation with the Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), the Secret Service (USSS), the Postal Inspection Service (USPIS) and the Drug Enforcement Administration (DEA), have apprehended more than 35 dark web drugs and arms dealers in a nation-wide bust. In the nation’s first inter-agency crackdown on dark web operators, the sweep ended in the confiscation of military-grade weapons, drugs and drug manufacturing equipment, $3.6 million in hard cash and gold bars and over 2,000 bitcoin, valued at around $12 million.
Financial firm Andreessen Horowitz has established a new $300 million crypto fund that is dedicated to investing in cryptocurrencies and other blockchain-related projects. Named a16z crypto, the new fund has the firm delving deeper into the cryptocurrency space to grow its existing portfolio, which includes digital currency exchange Coinbase. In a statement posted on the company’s blog, general partner Chris Dixon states that the a16z crypto fund provides the firm with the flexibility to invest in any area of its choosing, from traditional equities to digital tokens. As a result, the firm will be able to invest in both companies and the tokens those companies create.
Co-founder and CTO of Enjin Coin Witek Radomski has developed the ERC-1155 token, a new standard for defining video game tokens on the Ethereum blockchain. Radomski was responsible for the development of the ERC-721 non-fungible token standard that was used in the development of CryptoKitties. The new protocol allows for an infinite number of both fungible and non-fungible items to be deployed through a single contract, a breakthrough that has ramifications for tokenized asset management for the gaming industry and beyond.
The long awaited EOS launch occurred earlier this month, but it has not been without its difficulties. Daniel Larmier, the founder and technical architect of EOS, has confirmed that he wants to scrap the platform’s current constitution and build a new one. Speaking on the EOSIO Gov Telegram Channel, Larmier revealed that he has doubts about the company’s current on-chain governance model and called the existing constitution “unwise.” While Larmier has a proposal to change the problems, those for the change would have to outnumber those against it by 10 percent. They would then have to hold this position for 30 consecutive days within a 120-day period, so even if Larmier does get his way, we’re not likely to see the emergence of a new constitution for a minimum of four months.
On June 27, 2018, Coinbase CEO Brian Armstrong announced his new cryptocurrency charity fund, GiveCrypto. Armstrong established the philanthropic venture to financially empower people with direct cryptocurrency distributions. The charity has already raised $1 million from prominent cryptocurrency community members, and it plans to raise $10 million by the end of 2018 and $1 billion over a two-year time frame. The nonprofit’s mission is to give 100 percent of its cryptocurrency contributions to impoverished people, an altruistic goal that simultaneously drives cryptocurrency’s real-world utility.
This week, leading South Korean crypto exchange Bithumb experienced a major hack, while Mt Gox, the most notorious exchange to be hacked in bitcoin history, is also back in the news.
In Switzerland, the Bank of International Settlements is spreading some misinformation about digital currencies and blockchains; meanwhile, attorney Pamela Morgan is in the U.S. sharing great information regarding how you can plan for cryptoasset inheritance. In China, the asset management firm Reality Shares is giving investors access to blockchain-based companies at the forefront of this brave new world.
Featured stories by Jimmy Aki, Shawn Gordon, Nick Marinoff and David Weiss.
This week, the Bank of International Settlements (BIS) in Switzerland issued a new document as part of its annual economic report that warns citizens of the dangers of digital currencies. Many leaders in the crypto community have argued that the BIS is incorrect in much of what it seems to state as fact.
“The report is correct about price stability and potential scaling issues,” Jeremy Gardner, CEO of Ausum Ventures, told Bitcoin Magazine. “The rest is garbage.”
As for the rest, the article dredges up old arguments about Bitcoin mining’s energy consumption and the vulnerability of centralized exchanges. In sum, it covers very little new ground and shows a narrow understanding of blockchain technology.
Hackers have reportedly made away with cryptocurrencies worth $30 million from South Korean cryptoexchange Bithumb. The company has stated on Twitter that they would be compensating the affected users.
Leading Bithumb writes in a blog update, “Due to security issues; we are changing our system regarding deposits of cryptocurrency. All of our customers should stop depositing cryptocurrency until we notify that it is safe to deposit cryptocurrency.”
Think ahead to the days right after your last days on earth. How qualified is your will’s executor to manage your balance sheet of bitcoin, ether, Ripple, ZenCash and Ada? Are your loved ones ready to receive your private keys and open your hardware wallet? A recent episode of The Tatiana Show podcast tackled this question in an interview with Pamela Morgan, Esq., who’s been working exclusively with Bitcoin and open blockchains since 2014. The impetus for the appearance was the publication of her new book, Cryptoasset Inheritance Planning: A Simple Guide for Owners.
Asset management firm Reality Shares is launching China’s first blockchain ETF, which gives investors access to Chinese companies at the forefront of the blockchain revolution. The Index, will focus on China-based companies that are fully invested in blockchain technologies. Created as a joint partnership between Reality Shares and Nasdaq in January, the fund will “identify and invest” in such companies that are applying blockchain technology as the “first native digital medium of value.”
The Japan-based Mt. Gox exchange had its bankruptcy stayed due to a petition filed by some of the creditors for the commencement of civil rehabilitation proceedings in Tokyo District Court on November 24, 2017, and heard on June 22, 2018.
At issue primarily is the exchange rate of bitcoin at the time of the hack, approximately $480 per bitcoin. By staying in criminal bankruptcy, the creditors would have been paid back at the exchange rate at the time of the filing; but bitcoin has risen in value significantly since then, trading at over $6,100 per bitcoin today. This change means that creditors could be paid in terms of the amount of bitcoin lost and not the value of the bitcoin at the time of the loss: a significant difference.
Earlier this week, the Bank of International Settlements (BIS) in Switzerland issued a new document as part of its annual economic report that warns citizens of the dangers of digital currencies.
Since the report’s publication, many leaders in the crypto community have argued that the BIS is incorrect in much of what it seems to state as fact.
CEO and co-founder of Circle Jeremy Allaire commented that the report was “very shallow,” and added, “They haven’t done much research at all. They’re looking back at stuff that’s years old. They’re not looking at what’s going on in terms of the real R&D in this space. It’s just really poor research.”
This research appears to treat each coin as interchangeable with the next, and the findings claim that they “all [tend] to be very closely substitutable with one another.” Throughout the report, the author tacitly references the operations of Bitcoin’s blockchain and assumes that all cryptocurrencies function in a similar vein. These assumptions are fallacious in their logic and are hallmarks of the same “shallow,” narrow-scoped research that Allaire criticizes.
The document does acknowledge some benefits to blockchain technology. For example, sections point out that the blockchain can make cross-border payments easier and more efficient, along with the business of both importing and exporting goods.
However, the authors also claim that the blockchain will be too expensive to secure, and that it could “bring the internet to a halt,” as implementing it into digital retail transactions handled by national payment systems will overwhelm “everything from individual smartphones to servers.”
According to the text, cryptocurrencies are “not scalable” and are more likely to “suffer a breakdown in trust and efficiency” the more people use them. Most cryptocurrencies operate via decentralized platforms, which BIS says is a huge problem as they can deter users’ confidence.
“For any form of money to work across large scale networks, it requires trust in the stability of its value and in its ability to scale efficiently,” the report says. “But trust can evaporate at any time because of the fragility of the decentralized consensus through which transactions are recorded. Not only does this call into question the finality of individual payments, but it also means that cryptocurrency can simply stop functioning, resulting in a complete loss of value.”
“The report is correct about price stability and potential scaling issues,” Jeremy Gardner, CEO of Ausum Ventures, told Bitcoin Magazine. “The rest is garbage. Bitcoin’s decentralized consensus is backed by the most powerful computer network to ever exist and has never been broken. The entire point of blockchain technology is the immutability of the ledger of transactions. There’s no record of a major cryptocurrency like bitcoin or ether ‘simply stop functioning.’ These are arbitrary statements with no grounding in reality.”
Head of research at BIS Hyun Song Shin also believes that money has value strictly because it’s used, whereas, people are only holding crypto for speculative purposes rather than actually using it.
“Without users, it would simply be a worthless token,” he proclaims. “That’s true whether it’s a piece of paper with a face on it or a digital token.”
In addition to this perceived lack of value, researchers claim cryptocurrency mining operations are flawed due to the high amounts of energy they consume.
“Put in the simplest terms, the quest for decentralized trust has quickly become an environmental disaster,” the report states.
This is a criticism that has been refuted in the past on numerous occasions. CIO of Bitfury Alex Petrov, for example, has pointed out that traditional finance processes currently exceed the amount of energy required for bitcoin mining.
“There are 3.6 million ATMs deployed in the U.S.,” he said at a mining conference in May. “Each of them are using seven to 800 watts just in standby mode. This alone generates huge numbers of electricity usage, slightly higher than the Bitcoin network. If you add internal banking systems, CTVs, communicating with other banks and additional protection, you get higher costs than those of bitcoin.”
Scott Howard, CEO and co-founder of the Toronto-based venture ePIC Blockchain Technologies, stated at that same conference that many bitcoin mining operations will set up camp in abandoned industrial sites, thereby recycling the building’s resources and contributing less to toxic waste pollution. In addition, he pointed to large projects, like hydro dams, that produce energy regardless of whether it’s used or not, and that crypto mining simply capitalizes on this energy by consuming it when no one else will.
“Prices are low because the energy can’t find more productive use, often taking over abandoned industrial sites far away from urban centers,” he concluded.
The BIS report also states that virtual currencies are too vulnerable to manipulation, fraud and outside influence to ever work as stable mediums of exchange. Again, the report fails to consider the different mechanisms that different protocols employ, painting only in broad strokes.
Furthermore, the report ignores altogether applications like the Lightning Network that have made their way into the cryptocurrency scene as a means of solving the energy and scalability issues potentially facing the Bitcoin blockchain.
As the Lightning Network is built on top of present-day digital assets, it allows for greater volumes of cryptocurrency to be processed at faster speeds without consuming mass amounts of energy, potentially allowing for millions of transactions to occur per second.
The application gets its name from its “lightning fast” payments, which are powered by blockchain smart contracts, and users don’t have to worry about block confirmation times as payments will usually occur in either seconds or milliseconds.
There have been several popular articles in Database this month, so let’s take a look at five that did exceptionally well and that deserve some recognition. Also, take a look at some articles outside of DZone that showcase what’s been happening in the database world. Want to know more? Dive even deeper into Database and take a look at our Guides and Refcardz!
Here are five articles that did very well. There is a mixture of information in these articles, from an opinionated article on the best way to write a SQL query, to an analysis of consistency in databases.
Where Less Is More But You Still Pay Less: Hosting Your Database on a Raspberry Pi by Frederico Lois. There’s no such thing as too much performance. But what happens when your database software is so fast that it hits the limits of your hardware?
Would you like to have your article highlighted in a post like this? You can write and submit an article and become a contributor for DZone! Head over to our Writers’ Zone where you can view different topics on writing articles as well as our Bounty Board where you can submit articles to win prizes!
Does anyone else love crime shows? I sure do, so anything related to crime and catching bad guys is right up my alley. Take a look at this article to learn more about a DNA database that can help solve old cases!
Keeping with the theme of solving crime, this article explains how the police used facial recognition with license databases. This caused concerns for privacy among people. One question being asked is should the police be able to use facial recognition software even if it uses images of people that have never been convicted of a crime? What do you think?
Ever since GDPR, companies have been updating their policies in an effort to strengthen privacy. Take a look at this article to learn more about why Apple is prohibiting the selling and sharing of contacts databases.
Databases: Speed Scale, and Security. Advances in database technology have traditionally been lethargic. That trend has shifted recently with a need to store larger and more dynamic data. This Guide is focused on how to prepare your database to run faster, scale with ease, and effectively secure your data.
Graph-Powered Search: Neo4j & Elasticsearch. See how combining technologies adds another level of quality to search results. In this new Refcard, we include code and examples for using Elasticsearch to enable full-text search and Neo4j to power graph-aided search.
We love receiving feedback from our readers. Let us know in the comments what you would like to learn about next time!
“When Blockchain Revolution came out, bitcoin was worth around $7 billion. Today, it’s more than twenty-two times that. Bitcoin is the workhorse of the cryptocurrency world and the cryptocurrency that launched a thousand ships.”
So reads part of the preface in the newly-released second edition of Blockchain Revolution by the father-and-son team of Don Tapscott, founder and executive chair of the Blockchain Research Institute (BRI), and Alex Tapscott, founder and CEO of NextBlock Global, a digital asset company.
The first edition of Blockchain Revolution, published in May 2016, has been translated into 15 languages, is a bestseller in five Asian languages and remains Amazon’s number one selling book about blockchain technology.
Two years in the crypto world is a lifetime, so there’s lots of catching up to do in the second edition which contains a lengthy preface with plenty of new material, including information about tokens (utility, security, natural asset and commodity), a who’s who of the crypto world, leading companies in the space, instructions for leading crypto companies and their managers, and the “leadership of nations.”
Predicting a rosy future for bitcoin, the new edition notes that bitcoin’s impact on culture and the economy in the last two years has been “extraordinary” and points out that the remarkable price rise since 2016 means bitcoin has become an asset class too big for investors to ignore.
The attitude on the part of banks has changed since 2016 when blockchain “good,” bitcoin “bad” was the dominant ethics. Now even Goldman Sachs and JP Morgan are getting into the cryptocurrency market.
Noting bitcoin’s continuing success, the authors say:
“With the launch of the Lightning Network and other scaling solutions in 2018, bitcoin may also fulfill the promise of its most ardent supporters and obliterate the need for traditional financial intermediaries.”
The new second edition names 10 “leadership nations” who are best placed to lead the blockchain revolution and build the new innovation economy.
Alphabetically the countries are: Australia, Canada, China, Dubai (United Arab Emirates), Estonia, Singapore, Sweden (Stockholm and the “Node Pole”), Switzerland (Zurich and Zug), United Kingdom (London) and the United States (New York City and Silicon Valley).
Each country is briefly assessed with suggestions on how to move forward.
Silicon Valley’s important role is noted, but the authors also say that since blockchains are decentralized by design, it may be that a cross-border collaboration is more likely in the future, rather than being dependent on one or two dominating hubs.
Seven “conditions for success” in developing a blockchain hub are described: Incubators and Entrepreneurship, Corporate Leadership, Educational Institutions, Investment Climate, Government Support, Regulatory Environment and Communities of Talent.
The authors also describe Ethereum’s meteoric rise since 2016, from newly created startup to platform with a market value of $70 billion today. They also examine some of the new platforms built on the Ethereum blockchain and the current work around identity DApps.
ICOs and tokens were not part of the cryptocurrency landscape of two years ago, so they are explained in detail, as is the ongoing development of smart contracts.
QUOTES FROM BOOK
“When Blockchain Revolution came out, bitcoin was worth around $7 billion. Today it’s more than twenty-two times that. Bitcoin is the workhorse of the cryptocurrency world and the cryptocurrency that launched a thousand ships.”
“Bitcoin has become a store of hundreds of billions of dollars of value on the most robust computer network ever formed…”
“With the launch of the Lightning Network and other scaling solutions in 2018, bitcoin may also fulfill the promise of its most ardent supporters and obliterate the need for traditional financial intermediaries.”
“We believe that this next era could be inspired by Satoshi Nakamoto’s vision, designed around a set of implicit principles, and realized by the collaborative spirit of many passionate and equally talented leaders in the community.”
South Korea just ruled that bitcoin is a legally recognizable asset, which is good news for investors, but not such good news for convicted criminals that had managed to hold onto their cryptocurrency in the past. While 5,300 miles away in Slovenia, we see BTC City adopting full cryptocurrency support via blockchain by all vendors in the shopping center. Meanwhile, The Woz continues to have a sunny outlook on Bitcoin and predicts that, within 10 years, bitcoin will become a unifying currency around the world.
Looking back in the history of blockchain, we explore the evolution of blockchain education, from chatrooms to classrooms in this month’s cover story and the history of Bitcoin’s proof-of-work protocol.
Featured stories by Colin Harper, Nick Marinoff and Aaron van Wirdum
With the creation of Bitcoin and its blockchain, Satoshi Nakamoto introduced an entirely new practical application for cryptography, unearthing an unexplored area for computer science and technological development. Demand for instructional information and educational materials has risen dramatically since that time, with the first universities beginning to offer formal courses in 2013.
In this month’s cover story, we take a look at the different ways that people have been able to learn about the bitcoin and blockchain space, from the earliest days of message boards and meet-ups to the latest in university curricula and online resources.
Hashcash killed two birds with one stone. It solved the double-spending problem in a decentralized way, while providing a trick to get new coins into circulation with no centralized issuer.
In his latest installment of The Genesis Files series, Aaron van Wirdum looks back at the roots of proof of work. He examines not only the important role that Dr. Adam Back played in the development of Hashcash, which would eventually help to lay the groundwork for Bitcoin’s proof of work protocol, but also the seminal work of IBM researchers Dr. Cynthia Dwork and Dr. Moni Naor.
South Korea’s Supreme Court just ruled that bitcoin is a legally recognizable asset. The landmark ruling occurred on May 30, 2018, and it overturns a decision made by one of the country’s lower courts in a case dating back to last year. In September 2017, the Suwon District Court charged 33-year-old Ahn with the sale and distribution of child pornography.
Even though the court handed Ahn a guilty verdict and 18 months in prison for his actions, it did not confiscate the 216 bitcoins Ahn accumulated in exchange for the porn. According to the court, the government could not seize Ahn’s bitcoins because, unlike other assets tied to illicit dealings, they aren’t tangible. Now, the country’s Supreme Court thinks otherwise. The Suwon District Court’s decision was appealed, and, upon being challenged in South Korea’s highest court, it didn’t hold up.
Slovenia has announced that its largest shopping center, known as BTC City, will transform into a complete bitcoin city, in which every store and venture will accept cryptocurrency and operate via blockchain technology. BTC City presently plays host to several travel and tourism ventures including a luxury hotel and casino, a multiplex cinema, a waterpark and the Crystal Palace office park — home to Slovenia’s tallest building. Executives of BTC City say they’re hoping Bitcoin City will give rise to new businesses that push the cryptocurrency space toward mainstream territory and lead to further blockchain developments.
In a recent interview with CNBC, the computer mogul admitted that he hopes bitcoin will become a single global currency and that he shares the sentiment of Twitter and Square CEO Jack Dorsey, who expressed his belief last March that bitcoin will become a unifying cryptocurrency for every nation within the next 10 years.
This is not the first time Wozniak has been vocally positive about bitcoin. At a Money 20/20 event in Las Vegas last October, he lauded the cryptocurrency and its blockchain technology as stronger and more financially sound than both gold and USD. He stated that traditional currencies are “kind of phony,” as they are widely vulnerable to inflation, and that the problem with gold is that there is no fixed supply.
Who knew that the Czech Republic was so big on crypto? The country now has 46 bitcoin ATMs with 10 just being deployed in the Prague subway system. It’s probably good news then that the price of bitcoin has seemed to find a relatively stable triangle on its price volatility to encourage more real world use. But it seems that some speculators are starting to suffer from addiction to that volatility. Scotland’s largest addiction treatment facility has developed a treatment program for those investors who have maybe gone too far with their enthusiasm and just can’t stop.
Can conventional stock markets take advantage of the concepts of Atomic Swaps that we are seeing developed in the cryptocurrency space? It’s all part of the growing trend towards decentralization of everything and removing as many middlemen as possible.
Featured stories by Jimmy Aki, Erik Kuebler, Giulio Prisco, Nick Marinoff and Bitcoin Schmitcoin
Located in Prague, ATM manufacturer General Bytes has installed 10 new cryptocurrency ATMs throughout the Prague subway. Over 1.2 million people pass through the Prague subway on a daily basis, making it one of the busiest metros in Europe. With this latest move, commuters using the busy Prague Metro can buy and sell virtual currencies on the go.
Castle Craig Hospital — Scotland’s largest addiction treatment facility — has developed a center specifically dedicated to helping cryptocurrency addicts. Representatives explain that “cryptocurrency users can get hooked by the volatile fluctuation of prices online which creates a ‘high’ when they buy or trade a winning currency” and that “this can be exciting but also addictive and … financially disastrous.” The hospital has produced a list of 10 questions that individuals can ask themselves. If they answer “yes” to 5 or more, they likely fall into the “addict” category.
After days of sudden, strong selling, bitcoin has managed to find a local bottom in the low $7000s where it has been drifting around aimlessly. Traders have noted that we have formed a large consolidation pattern called a symmetrical triangle. Symmetrical triangles are consolidation patterns that are typically agnostic regarding their breakout direction. However, one important thing to note about this consolidation pattern is it embodies some of the hallmarks of a reaccumulation trading range (TR) — most notable is the volume profile.
There is strong evidence of supply absorption in the market which would likely lead to an upward breakout. However, it is important to note that symmetrical triangles are directionally agnostic and can oftentimes break to the downside.
In traditional stock exchanges, retail investors in public markets are unable to switch from one position to another without first going into cash. For example, an investor looking to trade his or her Amazon shares for PayPal shares must first exchange these Amazon shares for U.S. dollars, before buying PayPal shares with these dollars.
Atomic swaps allow direct conversion between two cryptocurrencies without having to use a third-party intermediary or exchange. By employing hash time-locked smart contracts, atomic swaps guarantee that parties will deliver the currency needed for the trade, or else the transaction is automatically canceled. These “all or nothing” trades preserve atomicity because they either take place or are canceled immediately.
The recently aired Season 5 of the popular HBO comedy Silicon Valley features a decentralized internet powered by end-user devices and an internal blockchain-based crypto economy. As usual, the fictional treatment in the show, which has been rightly praised for providing an entertaining but accurate portrait of contemporary tech trends, is based on real developments. In this article, our reporter Giulio Prisco looks at some of the actual projects underway in the real-life, blockchain world.
Cryptocurrencies and exchanges were the focus this week. Coinbase is getting into the decentralized exchange business with its acquisition of Paradex, potentially opening up thousands of ERC-20 tokens to traders, depending on what the SEC ends up doing with regulations. The parent company of the New York Stock Exchange, Intercontinental Exchange, continues work to implement a system to allow large investors to trade bitcoin directly. And Germany’s Deutsche Boerse is looking at getting into the cryptocurrency game. Finally, the city of Memphis had its first blockchain conference, which included keynotes from FedEx and a hackathon for various market segments that included some great prizes.
Featured stories by Amy Castor, David Hollerith and Nick Marinoff
Cryptocurrency exchange Coinbase just made an enormous play by acquiring decentralized relayer Paradex this week. Paradex bills itself as a decentralized exchange (DEX), meaning no third party is involved in holding the funds. Instead, users can use the platform to trade ERC20 tokens directly wallet to wallet. Paradex is built on top of the 0x (pronounced “zero x”) protocol.
Right now, Coinbase trades four coins: bitcoin (BTC), bitcoin cash (BCH), ether (ETH) and litecoin (LTC). Adding ERC20 tokens could significantly boost the number of digital assets it carries. Due to the ICO boom that has taken place over the last few years, thousands of different ICO tokens are now available.
Frankfurt Stock Exchange parent company, Deutsche Boerse AG, appears to have begun work on technology that will allow them to offer their clients bitcoin and cryptocurrency-related products.
Speaking at an industry event in London on May 23, 2018, Jeffrey Tessler, head of clients, products and core markets for Deutsche Boerse, said they are considering offering cryptocurrency products: “We are deep at work with it.”
As reported earlier by The New York Times (NYT) and Bitcoin Magazine, Intercontinental Exchange (ICE), parent company of the New York Stock Exchange (NYSE), is developing an online trading platform that would allow large investors to trade bitcoin directly. As news about the ICE platform continues to develop, Bitcoin Magazine spoke with lawyers Ben Sauter and Dave McGill of Kobre & Kim, a New York City law firm which specializes in disputes and investigations, to examine the regulatory issues surrounding the launch of such a platform, including swap contracts and the implications the ICE platform might have on cryptocurrency trading in the future.
In its first year, EthMemphis distinguished its place on the blockchain conference circuit for displaying an under-the-hood glimpse at what actually moves this young industry forward, specifically on the Ethereum network. The focus was on blockchain topics and projects applied to supply chain, healthcare, tourism/hospitality, education and law.
While Verge executives are claiming a DDoS attack is responsible for the recent serious delays on their blockchain, it appears that the problem may be more serious than the company is implying. The attack lasted more than a few hours and has resulted in over 35 million XVGs (worth approximately $1.7 million) being stolen. The theft occurred when hackers exploited a specific glitch in Verge’s technology by mining multiple blocks virtually one second apart using the same algorithm. This was the same tactic used in a hack just last month that saw over 250,000 XVGs disappear into thin air, forcing Verge to prepare a subsequent hard fork.
While Bitmain creates new ASIC Antminers to mine any cryptocurrency running Equihash proof of work, the affected cryptocurrencies look at measures to prevent it. New York has a lot of news happening this week, with the New York Stock Exchange’s parent company looking to get into bitcoin trading and Blockchain Week kicking off with the CDX Summit. South Korea continues to be a leader in blockchain technology, rolling out new partnerships with neighboring countries, and building out more blockchain technology.
Featured stories by Colin Harper, Nick Marinoff and Aaron van Wirdum.
Bitmain announced, via Twitter, the release of its new Antminer Z9 mini, an ASIC miner capable of mining any cryptocurrency running the Equihash proof-of-work (PoW) algorithm. This includes, most notably, Zcash, which is a decentralized and open-source cryptocurrency designed to offer users complete privacy in transactions. Zcash has always used the Equihash PoW mining algorithm to prevent the progress of Zcash ASIC miners and has predominantly been mined by general-purpose GPU chips.
The development of ASIC hardware is causing some cryptocurrencies to change their proof-of-work mining algorithm. Bitcoin Gold has a hard fork coming to defeat it and Monero has already modified their mining algorithm to counter ASIC hardware.
According to analytics firm GlobalData, South Korea has become a leader in the blockchain community. Businesses like Korea Telecom are already working to determine how the blockchain can be used to lessen production expenses and generate new types of revenue. Representatives of the South Korean telephone giant have already joined with Sprint and Japan’s SoftBank to launch a “blockchain-powered data roaming service” in the coming weeks. Executives say the company has big plans to use the blockchain to power “finance, IoT, smart energy and healthcare businesses.”
South Korea is also attracting businesses from neighboring countries like Japan, whose social messaging platform Line is set to launch a blockchain subsidiary known as Unblock within South Korea’s borders. The purpose of the subsidiary will be to further study the blockchain and determine how it can best be applied to the company’s remaining divisions. As the nation leads the blockchain revolution, neighboring regions are also taking the bait and looking into how blockchain technology can best be utilized to further cement operational security and efficiency.
Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange (NYSE), wants to establish its own cryptocurrency exchange. According to New York Times (NYT) sources, ICE has been in talks with legacy banks and financial institutions to facilitate swap contracts for potential bitcoin trading. These contracts would essentially allow banks to buy contracts for bitcoin, giving the exchange sure anchors of liquidity. Once an exchange user buys one of these contracts, cash changes hands and the corresponding bitcoin would appear in their wallet the next day. The report reveals that the exchange, which would be built with “large investors” in mind, would permit direct bitcoin trading, not futures contracts as we’ve seen with the CBOE and CME.
The latest installment of the Chief Digital Officer Global Forum (CDX) summit series will be held in New York on May 11, 2018. Established in 2013, the summit has set up shop in Chicago, San Francisco, Singapore and, most recently, Las Vegas, with focuses on emerging innovations in mobile, IoT and digital advertising technologies.
This latest installment will concentrate on advancements in blockchain technology and its application to traditional industries. To this end, the CDX Blockchain Brand Innovation Summit has an extensive list of speakers and panelists both from within and without the blockchain space, featuring representatives from the likes of Hulu, CNBC, IBM and BTC Media.
The Breaking Bitcoin conference, first organized last summer in Paris, is returning for its second edition under the name “Building on Bitcoin,” this time in Lisbon, July 3–4, 2018. While the event in the French capital was centered around security, the one in the Portuguese capital will focus on second-layer technologies and other creative uses of the Bitcoin protocol.
Building on Bitcoin will focus on second-layer technologies in a broad sense. The best known and most popular of these is probably the Lightning Network, of which the first implementations entered their beta stage over the past couple of months. But other areas of research and development include different types of sidechains like Liquid, RSK or drivechains; privacy technologies like TumbleBit; smart contract solutions like MAST; and more.
The Lightning Network continues to make news and Bitcoin Magazine’s latest cover story looks at what the future might hold for the innovative technology. Also new this week, BTC Media’s highly anticipated 2018 “Map of the Blockchain/Crypto Ecosystem” was also unveiled. It’s full of creative visual treats highlighting the state of the sector and its explosive growth.
Developing interest and commitment to blockchain technology is also continuing to grow around the world. In the Middle East, the Mobility Open Blockchain Initiative (MOBI) was announced at the Dubai-hosted Futures Blockchain Summit with a focus on transportation. Saudi Arabia is making headway on adopting blockchain technology for supply chain management in the oil and gas sector. And 5 blockchain projects were highlighted at the International Association for Cryptologic Research conference in Tel Aviv.
Featured stories by Amy Castor, Randolph Malone, Nick Marinoff, Jessie Willms and Aaron van Wirdum
After years of design and work, the first Lightning implementations are now in beta. More nodes are appearing online every day, a growing number of users are opening channels with one another, and some merchants have even started to accept Lightning payments.
Following up on last month’s cover story, The History of Lightning: From Brainstorm to Beta, Aaron Van Wirdum takes a look at some of the most promising projects that will take Bitcoin and Lightning into the future.
The 2018 edition of BTC Inc’s popular “Map of the Blockchain/Crypto Ecosystem” has been unveiled. The map provides a visual representation of “the space” in the form of a city skyline with buildings displaying the logos of various entities.
Designed by Josh Dykgraaf, the cityscape is subdivided into 10 islands, each depicting a distinct facet of the industry: Mining, Processors, Media & Advocacy, Currencies, Wallets/Hardware, Exchanges, ICOs/Tokens, Enterprise, Blockchain Venture Capital and Blockchain Applications & Projects.
Major companies including IBM, Context Labs, Ford and BMW announced their collaboration at this year’s Futures Blockchain Summit in Dubai and have formed the Mobility Open Blockchain Initiative (MOBI). MOBI will explore further blockchain use and study how it can reduce the cost and increase the safety and accessibility to transportation around the world.
Through an open-source business design, MOBI is aiming to boost blockchain adoption among businesses that either develop or deliver autonomous vehicle and mobility services. Thus far, the group has sent invitations to various automakers, public transportation operators, toll road providers, blockchain firms, technology firms, academic institutions, startup entrepreneurs and global regulatory bodies to join the cause.
In line with their Vision 2030 commitment to adopt advanced technology including blockchain, Saudi Arabia’s state-owned oil company Aramco is working toward adopting blockchain technology for management and accounting.
In an interview with Bitcoin Magazine, Nick Spanos, CEO and co-founder of Zap.org, and founder of Blockchain Technologies Corp and the Bitcoin Centre NYC, talked about the Saudis’ enthusiasm for blockchain technology.
“Saudi Arabia is kicking the tires, and that’s huge. As part of their ambitious Vision 2030, Saudi Arabia as a whole is doing everything it can to modernize and diversify their economy. It means they’re open to doing things differently — and to doing big things with blockchain.”
For the second year in a row, a flagship cryptography conference in Europe has devoted an entire session to blockchain technology.
Hosted by the International Association for Cryptologic Research (IACR), the conference was attended by 370 people. Five blockchain papers were presented on the second day of the conference, and one of those even received a “best paper” award.
The financial sector is seeing growing interest in cryptocurrency that has resulted in more and faster adoption according to the latest survey by Thomas Reuters. That news will certainly bolster the objectives in the Middle East where Dubai aims to be the first blockchain powered city. It is also reflective of the hype surrounding EOS as more than 50 companies are competing for 21 supernodes.
But before there was all of these cryptocurrency projects, there were the cypherpunks. In a special feature, we look at the accomplishments of Dr. David Chaum and what has resulted from his early papers on encrypted communication.
Featured stories by Colin Harper, Giulio Prisco, Jessie Willms, Aaron van Wirdum and Bitcoin Schmitcoin.
EOS is scheduled to migrate from the Ethereum network to its own on June 2, 2018, and candidates are excitedly vying for one of 21 supernodes that will support this new mainnet. A mixture of big and little fish, the candidate pool includes upward of 50 different organizations, an overwhelming number of candidates competing for the coveted supernodes come from Chinese organizations.
These 21 supernodes operate as part of EOS’s delegated proof-of-stake (DPoS) consensus mechanism. In order to keep block producers honest, the network implements a continuous voting process that places supernode operators up for reelection every 21 blocks.
Cryptographer Dr. David Chaum is looked at as the man who first envisioned cryptocurrency with his talk on eCash when speaking at the first ever CERN conference in Geneva in 1994. Chaum, who started as a computer science professor at Berkeley University, was not just a digital privacy advocate. He designed the tools to realize it.
First published in 1981, Chaum’s paper “Untraceable Electronic Mail, Return Addresses, and Digital Pseudonyms” laid the groundwork for research into encrypted communication over the internet, which would eventually lead to privacy-preserving technologies like Tor. In 1982, he published his second major paper: “Blind signatures for untraceable payments.” where the cryptographer had designed a solution to realize an anonymous payment system for an internet that had yet to exist.
According to a new Thomson Reuters survey, cryptocurrency trading by financial firms could increase in 2018, with 20 percent of 400 survey firms indicating they are considering trading cryptocurrency over the next 3–12 months. Among the participants in the survey who indicated they would trade cryptocurrencies in 2018, approximately 70 percent said they were planning to do so over the next 3–6 months with an additional 22 percent planning to trade over the next 6–12 months. The survey also found generally widespread familiarity with cryptocurrencies.
“Cryptocurrency is still a relatively small part of the trading market, but this survey makes clear this niche segment is starting to enter the mainstream of the financial services industry. This is a major change from a year ago,” said Neill Penney, co-head of trading at Thomson Reuters, in a statement.
In a Memorandum of Understanding (MOU) signed recently, ConsenSys and the Saudi Telecom Company have agreed to work together to design and build out blockchain technology in a range of government and private sectors including real estate, banking and healthcare. With this partnership, Dubai aims to be the world’s first blockchain-powered city.
The price of bitcoin is creeping up this morning into the mid-$9,000 range.
According to yesterday’s price analysis, whether the market was going to move up or down remained to be seen, but key price levels to watch have been near the bottom of our current trading range in the $8,600s. A breakdown of that price level would likely send us retesting our macro lows in the $6,000s. If this current trading range were to break down, that would be an incredibly bearish signal as that would indicate the overwhelming presence of supply in the market.
Coinbase continues to grow with its acquisition of Earn.com this week, getting both a CTO and a company out of the deal. In the meantime, the New York Attorney General is working to bring greater transparency into how cryptocurrency exchanges operate with a letter and a three-page questionnaire going out to 13 exchanges, one of which is Coinbase.
The seemingly neverending struggle to find a new online ad model continues with a new proof of concept slated to be released next month from a triumvirate of companies with different interests in the question, IBM, Salon and AdLedger. Advertising however is the least of the problems faced by Telegram as Russian security forces try to crack down on the popular messaging app, even going so far as to block huge swathes of IP addresses.
Featured stories by Amy Castor and Nick Marinoff
Cryptocurrency exchange Coinbase is buying Earn.com, a social network that allows users to earn digital currency by replying to emails and completing small tasks online. In the process, Coinbase has made Earn.com co-founder and CEO Balaji Srinivasan its CTO.
Coinbase has been on a bit of a buying binge lately having just acquired Cipher Browser last week, making Earn.com their fifth acquisition. While Coinbase hasn’t revealed how much they spent, it is telling that Earn.com has raised more than $120 million in a series of funding rounds. In addition to the tech talent and technology acquired by Coinbase, Srinivasan said the plan is to “scale it up across Coinbase’s massive user base.”
In the interest of bringing greater transparency into how cryptocurrency exchanges operate, New York Attorney General Eric Schneiderman has sent letters to 13 virtual currency exchanges requesting they disclose key information about their operations. The letter was part of a “Virtual Markets Integrity Initiative” launched by Schneiderman to shine a light on the policies and practices of platforms used by consumers to trade virtual currencies and initial coin offering (ICO) tokens.
In addition to the letter, the attorney general sent a three-page questionnaire to Coinbase, Gemini, Bitfinex, Poloniex and nine other exchanges asking them to disclose details such as the banks used, fees charged and how they are derived, how funds are held, who has access to their order books and the scope of third-party audits.
The internet has made advertising models increasingly complicated, where advertisers and publishers once had a one-on-one relationship, today’s ads go through a series of intermediaries before they reach their target audience. The model allows for fraud that siphons money away from advertisers by spoofing them with fake impressions. Some estimates show that one third of paid-programming impressions are not viewed by actual people.
Joining a growing list of companies looking to address this problem, Salon is teaming up with IBM and nonprofit AdLedger to participate a proof-of-concept permissioned blockchain for programmatic ad buying. The project is expected to launch next month.
Telegram CEO Pavel Durov is battling against Russian security forces, after they implemented a block on Monday, April 16, 2018, on the messaging app when it refused a court order to “grant state security services access to its users’ encrypted messages,” according to Reuters.
He is offering bitcoin grants to both companies and individuals alike that run proxy servers and virtual private networks (VPNs). He says he’s “happy to donate millions of dollars” from his personal stash to illustrate and assist in this cause, noting that both VPNs and proxy servers work against the hindrances set in place by Russian authorities.
Golem has lumbered in from the wilderness now with its first beta release, the Brass Golem, bringing the notion of Airbnb for computers to life on Ethereum. Also in Ethereum news, Ether Capital seeks to be a steadying and calming force in the Ethereum technology and ICO space.
Samsung has now confirmed that it is manufacturing ASIC chips for Halong Mining, while the ASIC-resistant hashing algorithm that is part of Ravencoin has peeked its head above the clouds with a new white paper and detailed roadmap.
In regulatory news, the EU has formally launched blockchain initiatives with 22 member countries joined in cooperation to develop education and regulation for the industry.
Featured stories by Amy Castor, Colin Harper, Nick Marinoff and Justin O’Connell
On November 11, 2016, Golem raised 820,000 ether — worth $8 million at the time — in 29 minutes. Golem was one of Ethereum’s earliest ICOs, and this week their beta, known as Brass Golem, went live on the Ethereum mainnet.
Initially advertised as an “Airbnb for computers,” the Golem idea is to create a global market for your idle computing power. You can rent out your unused computing power and be paid for it in cryptocurrency. Ultimately, the goal for Golem is to make just about anything that requires heavy computer lifting, such as CGI rendering, scientific calculation, machine learning and more — both affordable and accessible.
It’s now confirmed that Samsung has been producing high-capacity memory chips for GPUs for years. The company has now confirmed that it is providing ASIC chips to mine bitcoin, ether and assorted cryptocurrencies for hardware manufacturer Halong Mining. Its partnership with Halong is expected to bring heavy competition to the ASIC industry, primarily to China’s Bitmain, which, up to this point, has largely dominated the chip-development arena.
Officially launched at the beginning of 2018, Ravencoin (RVN) has a stated aim “to implement a use-case-specific blockchain, designed to efficiently handle one specific function: the transfer of assets from one party to another.”
According to founder Tron Black, RVN bears several resemblances to Bitcoin, with many of its advantages being extended to assets. In the future, he says Ravencoin will also bear features similar to Ethereum’s ERC20 and ERC721 contracts. The company’s road map shows that they are on Phase 2 of 6, but no dates are associated with deliverables.
Ether Capital is positioning itself to be the first Ethereum-focused publicly traded company. Having already raised $45 million through a private placement, the Toronto-based firm is now close to finalizing the reverse takeover (RTO) of a Vancouver shell company by mid-April.
“We want to create accretive value by building a true business, rather than acting as a venture capital firm that makes 10–15 investments and is pleased if two or three appreciate in value,” said CEO Michael Conn in an interview with Bitcoin Magazine. “We are really looking to be a meaningful alternative to both ICOs and venture capital. We are not precluding ourselves from collaborating with VCs or private investors in any of our investments, but ultimately [we] need to see how a business fits in to our broader vision of interoperability.”
The European Union has been active this year in exploring blockchain technology and assessing potential regulation and growth. On April 10, 2018, 22 European countries joined forces to cooperate on blockchain regulation and education. The European Blockchain Partnership “will be a vehicle for cooperation amongst Member States to exchange experience and expertise in technical and regulatory fields and prepare for the launch of EU-wide blockchain applications across the Digital Single Market for the benefit of the public and private sectors,” states the European Commission press release.
Lightning continues to strike as more and more companies announce that they are including in their products the new Lightning Network protocol that recently entered beta. Sparks also flared up at the Deconomy conference in South Korea when Vitalik Buterin and Joseph Poon challenged Craig S. Wright’s legitimacy.
And, while India joins a growing list of countries that has announced further restrictions on digital currencies and who can use them, the CEO of NVIDIA announced on CNBC that cryptocurrencies were here to stay.
Featured stories by Amy Castor, Colin Harper, Nick Marinoff and Aaron van Wirdum
As of a couple of weeks ago, the first Lightning implementation — lnd — is officially in beta. The second implementation — eclair — followed last week, while the third — c-lightning — is expected to do so soon. As such, the Lightning Network, the long-awaited Bitcoin overlay network for cheap and instant transactions, is by many of its developers considered safe enough to use on Bitcoin’s mainnet: a major milestone for the technology that has been years in the making.
In our featured cover story this month, tech writer Aaron van Wirdum recounts the story behind this important addition to the Bitcoin ecosystem.
Sparks flew at the Deconomy blockchain forum this week in Seoul, South Korea, following a presentation by self-proclaimed “Satoshi Nakamoto,” Craig S. Wright, when he was challenged by Ethereum creator, Vitalik Buterin, and called a “fraud.” The Q&A session heated up again when Joseph Poon, who helped to write the Lightning Network white paper, declared that even he didn’t understand Wright’s representation of how the protocol worked.
Although the cryptocurrency markets continue their downward trend, NVIDIA CEO Jensen Huang recently claimed that “cryptocurrency is here to stay,” and he “doesn’t see the craze ending anytime soon,” while speaking with Mad Money host Jim Cramer. Interestingly, Huang noted that while the NVIDIA chips were no doubt powerful and crucial to the mining industry, he and his fellow executives are “not ready to move” on this market segment specifically just yet.
Another country has cracked down on cryptocurrencies as the Reserve Bank of India (RBI) announced, in a press release on April 5, 2018, that it is banning banks and regulated financial entities from dealing with digital currencies. While India has not given up on the idea of issuing a cryptocurrency of its own, this means is that banks will no longer be able to transfer money to a crypto wallet or to an exchange. Regulated entities already providing such services will have three months to wind down their cryptocurrency-related operations.
Bitcoin Magazine just wrote about the first Lightning implementation being in beta a couple weeks ago and now developers have introduced LApps for the network that look outside the limits of mere wallet and payment channel functionality.
While these applications can run on either Bitcoin’s mainnet or testnet, their developers generally recommend that users stick to testnet payments until the Lightning Network’s kinks are ironed out. But with more than 1,000 nodes already supporting Lightning’s mainnet, it shouldn’t be long before LApps are widely adopted.
The week began with news that Twitter’s ban on cryptocurrency ads was taking effect immediately, affecting an industry already taking a hit in interest worldwide. Studies are showing that internet searches are on the decline. But things are looking a little more optimistic in areas like South Korea, which seems poised for growth. Indeed, it was announced that cryptocurrencies will be accepted in over 6,000 South Korean stores over the coming months.
This week’s tories contributed by Jeremy Epstein, Nick Marinoff and Amy Castor
Less than two weeks ago, the social media giant announced it was developing new policies which would lead to the eventual ban of cryptocurrency and ICO-related advertisements on its platform. That ban suddenly took effect on March 27.
“We are committed to ensuring the safety of the Twitter community,” said a company representative. “As such, we have added a new policy for Twitter Ads related to cryptocurrency. Under this new policy, the advertisement of Initial Coin Offerings (ICOs) and token sales will be prohibited globally.”
Following a three-month period of drooping prices, it appears interest in bitcoin and digital currencies is falling to new lows, and the market value is sinking along with it. In addition, interest in bitcoin and cryptocurrency related jobs is generally on the decline, though blockchain gigs remain stable enough. Some regions, like India, on the other hand, are seeing job growth.
What we’re probably witnessing is a “shift” in interest, not necessarily a lack of regard for cryptocurrencies; instead, interest may be adapting as people learn more. Analysts are still predicting that overall interest in crypto could spike again later this year. Many remain bullish on virtual assets, particularly bitcoin, and suggest it could reach new price highs by the summer of 2018.
Bitfinex, the fifth-largest cryptocurrency exchange by 24-hour trading volume, is looking to hoist itself out of Hong Kong and settle in Switzerland. As confirmed by sources close to Bitfinex, the exchange is already in talks with Swiss authorities.
Jean-Louis van der Velde, CEO at Bitfinex, hints that a move to Switzerland would bring a renewed transparency to the business. “We want to be the most transparent of all exchanges and meet the requirements of the Swiss regulator,” he said.
Korea has many of the pieces of the puzzle to become the first “Crypto-Powered Nation,” one that runs on blockchains and supports a crypto economy.
Cryptocurrency awareness and adoption are already widespread throughout the country. The end result is that the crypto-infrastructure is in place to handle a large number of customers and almost everyone there has heard of the concept.
The current government, led by President Moon Jae-in, relies heavily on the support of the young adult population. Not surprisingly, this is the same demographic that is highly invested in crypto-assets. As a result, the government is likely to support balanced regulation when it comes to cryptocurrencies. “The government needs the young people to stay in power, and young adults love crypto. They are not going to mess that up.”
Between the money coming in and going out, Korean exchanges and the network of providers that support them are seeing a huge amount of activity. The end result is that they are being forced to innovate on security and scaling solutions. The in-country knowledge could ultimately trickle down to benefit other South Korean companies in the blockchain industry. This, in turn, would give them a competitive advantage by allowing these companies to test and refine a lot of these systems at enterprise scale within the country.
Combine all that with an intense culture of achievement, a drive for economic success and an increasingly global outlook as the country has vaulted to become one of the top 10 economies worldwide, and you have the recipe for a powerful cycle of innovation.
Popular South Korean cryptocurrency exchange Bithumb is partnering with digital payment service provider Korea Pay Services (KPS) to pave the way for widespread digital asset adoption in the country. Both companies are working to give over 6,000 of the country’s retail outlets the option of accepting cryptocurrency payments for goods and services.
Executives say they are seeking to launch these new services by summer of 2018, then increase the number of stores to 8,000 by the year’s end.
Petros reviews the GitStorage server appliance, which emphasizes data privacy and security.
By profession, I’m a software developer. Aside from a preferred editor, what matters most to a developer is the use of a Source Code Manager (SCM). So, when a new product comes along featuring my favorite SCM, Git, I had no choice but to spend some time using it.
GitStorage develops and distributes a Git server appliance of the same name with an emphasis on data privacy and security. The company produces two flavors, the key differences being the following:
When I received the product, it was packaged well with everything needed to hit the ground running: the device, a micro-USB-connected power plug, mounting screws and a basic set of instructions for connecting to the local device over Ethernet. All you need to do is connect it to your router or switch, apply power to the device, and within a minute, you’ll be able to access a web-based front end to the device’s assigned IP address from within your preferred web browser.
On initial connection, you’re greeted with a setup and configuration menu. This setup allows you to configure the administrator account, generate CA certificates for your web browser, configure SMTP email relays so you even can connect the device to an existing Dropbox account for remote synchronization—all of which can be configured at a later date.
The GitStorage Dashboard
When the configuration is complete, you’re redirected to the dashboard of a very intuitive user interface. And because this is a single-purpose appliance, the features and functionality presented in the interface are simple and easy to understand. You can dynamically create or remove users, create new or remove existing code repositories, and assign the appropriate users to those repositories. When those same users log in to the web interface, they will be limited only to the repositories to which they are assigned.
A View of Repositories
Again, the device is predominately focused on securing your data and limiting access to those who are granted it. Data at rest is always encrypted—that is, it’s local to the device, even when synchronized to the cloud. For instance, if Dropbox is configured as your back-end remote archive location, a tarball that is GPG-signed will be synchronized to it. Even if people were to access that Dropbox archive, they will need a password to decrypt the file and then untar the tarball.
A Synchronized Archive File to Dropbox
Now, how does GitStorage compare to existing Git solutions? It simplifies the task of deploying and maintaining your very own Git servers. You don’t need to be a Git expert to get this handy device up and running and start providing developers the comfort and security of maintaining their code using the industry’s most popular SCM. Out of the box, it is easy to configure and just works. Also, if very sensitive source code is pushed to this device, rest assured that your data at rest always will be encrypted in both local and remote locations.
What environments would benefit from this? I see this as a perfect solution for hobbyists and small-to-medium-sized software development firms. As long as you don’t push too many binary files, the larger of the two devices (64GB) definitely can last you some time. And even if it doesn’t, you’re also able to add more GitStorage devices to your network.
Following last weeks news from Lightning Labs about the first beta release of the “Lightning” protocol for Bitcoin, Stellar announced that they will be integrating Lightning. In other announcements, the rise of decentralized exchanges continues with news from Kyber and Binance launching their decentralized exchanges.
Google and Twitter appear to be following Facebook’s lead in announcing they will impose a blanket ban on all cryptocurrency-related advertising across all of their properties, including Adwords and YouTube. Twitter CEO Jack Dorsey, however, is predicting that Bitcoin will be the single currency of the internet.
Featured stories by Colin Harper, David Hollerith, Erik Kuebler, Nick Marinoff and Aaron van Wirdum
Hot on the heels of last week’s announcement from Lightning Labs, the Stellar network team has announced that they will be integrating said product. That makes Stellar among the first projects to formally announce integration of the Lightning Network since the beta release
Founder Jed McCaleb said, “There’s three main benefits: There’s the scalability benefit, obviously — Stellar can scale pretty well right now but Lightning takes that much, much further; there’s privacy benefits, as Lightning allows transactions to be kept off the public ledger; and then there’s also interoperability,” referring to the prospect of Atomic Swaps.
Decentralized exchanges promise a world in which cryptocurrency can be traded without a centralized middlemen. Most exchanges currently work in a centralized fashion, but recently, both Binance and Kyber Network released news of progress toward the future of decentralized exchanges: Binance announced the launch of a decentralized exchange, and Kyber Network made their decentralized exchange beta available to the general public.
Decentralized exchanges don’t rely on a third party to conduct trades or store cryptocurrency. Instead, they use blockchain technology to enable peer-peer trading without an additional third party. Because decentralized exchanges don’t have to be for-profit entities, they can provide fee-less or close-to-free trading, but that usually comes at the cost of usability.
Following Facebook’s lead, Google announced it will ban all cryptocurrency advertising on its platforms starting June 2018; that includes YouTube and any site that accepts Google ads. Just days later, Sky News reported that Twitter will ban a range of cryptocurrency advertising by April 2018, Twitter has not confirmed or denied the report. Matthew Frankel with the Motley Fool suggests, the main purpose of Google’s ban could be to protect investors without harming those already currently involved in the industry for the sake of positive development of the blockchain technology business ecosystem as a whole.
With Facebook and Google controlling about 65 percent of the ad market in the U.S., this ban will severely limit the available channels for crypto advertising. However, digital strategist with BTC Inc Rick Hanna, suggests that other social media platforms such as LinkedIn, Medium and Reddit will be used more often unless they follow suit with similar bans.
Twitter and Square CEO Jack Dorsey had some remarkably positive remarks about bitcoin. Predicting the future of finance, he suggested that the “father of cryptocurrencies” is likely to become the world’s only currency within the next 10 years, namely Bitcoin. Dorsey’s optimism comes at a time when cryptocurrencies have been deemed “not that significant” by varying regulators.
This is the second in a series by Aaron van Wirdum focusing on real people who use cryptocurrencies. In this installment, he visits the town of Norcia, Italy, after it was devastated by an earthquake. Meet Ilaria, Lorenzo and Alessia, who, thanks to the efforts of Guido Baroncini Turricchia and Helperbit, were given their first bitcoins to help rebuild their lives.
Bitcoin development took a major step forward this week when Lightning Labs announced the first beta release of the much anticipated “Lightning” protocol for Bitcoin, while also raising $2.5 million to fund continued development.
Meanwhile, cryptocurrency and ICO regulation stories have continued to dominate the headlines, as the U.S. Federal Government held hearings and the Dutch finance minister released a letter relating to how their respective legislators should approach cryptocurrencies and ICOs. On a positive note, a New York state assemblyman has introduced a bill to protect cryptocurrency investors and ease regulation on crypto-related businesses.
Featured stories by Shawn Gordon, Colin Harper, David Hollerith, Erik Kuebler and Aaron van Wirdum.
Lightning Labs announced lnd 0.4-beta, the first beta release of the Lightning software implementation spearheaded by the development company. This is the first beta release from Lightning, which means they believe the project is feature complete and safe enough to use on the Bitcoin mainnet. CTO Olaoluwa Osuntokun said, “We’re calling this lnd release a beta as it has all the necessary safety, fault-tolerance and security features that we’ve deemed necessary.”
Significantly, the beta release is compatible with various Bitcoin implementations, where the alpha versions required btcd to interact with Bitcoin’s blockchain. The beta allows users the options to use their own preferred backend, such as bitcoind.
In conjunction with the software release, Lightning Labs announced a seed-funding round of $2.5 million to fund continued development of lnd. Investors include big names in the Bitcoin, blockchain and broader tech industry.
The U.S. government held a hearing in their House Financial committee entitled “Examining the Cryptocurrencies and ICO Markets.” This was the first hearing in which members of the U.S. Congress addressed cryptocurrencies and ICOs. Witnesses at the hearing included representatives from Coinbase, and Coin Center, as well as various law firms and others.
The hearing addressed the economic efficiencies and potential capital formation opportunities that cryptocurrencies and ICOs offer to businesses and investors. Notable points addressed included the need for security and investor compliance for U.S. cryptocurrency exchanges; the need for regulators to distinguish the difference between cryptocurrencies that are considered digitally scarce commodities and securities tokens; among other points, all in such a way that won’t stifle domestic innovation by forcing investors and businesses to leave the country.
In New York, state Assemblyman Ron Kim introduced a bill to protect cryptocurrency investors and ease regulation on crypto-related businesses. Known as The New York Cryptocurrency Exchange Act (A9899), the bill relates to “the audit of cryptocurrency business activity by third party depositories and prohibits licensing fees to conduct such cryptocurrency business activity.”
The law would mandate that any cryptocurrency business or entity be subject to routine audits by a public or third-party depository service. Any entity in full compliance will receive a digital New York Seal of Approval to reassure consumers that the outlet is trustworthy and secure. This seal would ideally replace the BitLicenses currently issued by the New York State Department of Financial Services, doing away with this fee-based license in favor of one earned by audit.
Dutch Finance Minister Wopke Hoekstra sent a six-page letter to the House and Senate that outlined his concerns over the rapid and dramatic growth in cryptocurrencies. He emphasized that there has been little time to understand and react to the changing landscape and that the current supervision and regulatory framework is ill equipped to deal with it. He said he will actively be working in a European context, but the entire process will take time and coordination between disparate governments and agencies.
Our reporter Aaron van Wirdum visited the town of Rovereto in the Italian Alps, where it’s easy — and encouraged — to buy pizza with bitcoin. He profiles the local business owners and Bitcoin advocates whose enthusiasm for cryptocurrencies is turning the close-knit community into a thriving “Bitcoin Valley.”
“When people first hear about bitcoin they start asking questions — about the technology, about mining. But what they really want to know is if they can trust it. We were able to skip this step because people trust us. We have familiar faces,” Claudio Gobber of Inbitcoin explains. “This is how we grow Bitcoin: We start small and have it spread from there.”
The new TREZOR model T, a hardware cryptocurrency wallet developed by SatoshiLabs, is the second generation of SatoshiLabs’ popular TREZOR hardware wallet family. The Model T was announced in November 2017, on the ninth anniversary of Satoshi Nakamoto’s Bitcoin white paper and made available for pre-order. All pre-order devices were sold out, and regular sales are expected to start soon.
Bitcoin Magazine has tested a TREZOR Model T. The matchbox-sized device comes in a sleek package with a USB-C cable for connecting to a computer or phone; stickers and other accessories; and a minimalist Post-it-sized “Getting Started” guide. An online guide titled “Getting started with TREZOR Model T” provides more detailed instructions with pictures.
The device is only powered when plugged in and connects to the blockchain via a web interface through the host computer. Contrary to previous TREZOR models with buttons, the Model T has a touchscreen. Other differences include a new version of the firmware, TREZOR Core, which has been written from scratch. The source code for TREZOR Core is available on Github, with other TREZOR software.
The new device also comes with a magnetic dock that can be affixed to any firm surface. The Model T can then be attached to the dock by means of magnets embedded in the device.
We plugged the device into a computer and followed the instructions in the online guide, which direct the user to open a supported browser and go to the TREZOR web interface. Once the firmware was correctly installed, we went on to create a new wallet.
The web interface gives step-by-step instructions, synchronized with instructions that appear on the device’s screen.
After generating a new wallet, the user should immediately follow the instructions to create a backup in the format of a personal recovery seed. The Model T generates a unique, 12-word long recovery seed, which is displayed on the device screen. The user should write down the seed words on a recovery card (there are two recovery cards in the box, in case one is lost). Then the device randomly selects two words and asks the user to retype them on the screen for verification.
The 12-word seed permits recovering the content of the wallet in case, for example, the device is damaged or lost, and it is the only way for the user to do so. Of course, malicious parties could do the same. Therefore, it’s very important to follow the recommendation: “Remember to keep your card with the seed words in a safe location and never store it as a digital copy. We strongly discourage you from taking photos of your recovery seed or to make any digital copies. Please do not write down the words into a text file on your computer, even if your computer is encrypted.”
The next step is naming the device and choosing a numeric pin code by using the touchscreen on the device. An essential security feature of this step (that some might find annoying) is that the layout of the numeric keypad on the touchscreen changes at each input.
Now, the TREZOR T is ready to be used by simply plugging it into a computer (if the computer doesn’t have the TREZOR Bridge software and driver installed, those must be installed first), authenticating with the pin code, and using the web interface. The web interface and the on-screen interface on the TREZOR T work smoothly in tandem, and, often (for example, when sending funds), the information entered via the web interface must be confirmed on the device.
Besides Bitcoin, the TREZOR T supports Bitcoin Cash, Bitcoin Gold, Dash, Litecoin, Zcash, Ethereum and Ethereum Classic; both versions of Ethereum are supported through a partnership with MyEtherWallet.
We tested the TREZOR T as a bitcoin wallet. First, we sent bitcoin from external wallets, in multiple transactions, to a new bitcoin address generated by the TREZOR T. Then, we sent bitcoin from the TREZOR T to external wallets. All transactions went through without problems and appeared in the transaction list in the web interface.
When the TREZOR T is unplugged, it powers down and disconnects from the internet. Therefore, the user’s funds stored on the device are safe and beyond reach of thieves, making this hardware wallet a secure, matchbox-sized, cryptocurrency “bank.” Of course, it’s important to store the device (and in particular the cards with the seed words) in a safe place — or even better, in separate locations.
In summary, the TREZOR T is useful and usable. Perhaps the initial set-up procedure is a bit complicated for users without a minimum of computer expertise, but most users of hardware cryptocurrency wallets are likely to be able to, for example, install drivers manually if needed by following the clear instructions in the user guide. After the initial set-up, the TREZOR Model T seems very easy to use, with an appealing UI and cool new features.
Disclaimer: SatoshiLabs provided Bitcoin Magazine with a free TREZOR Model T to use for the purpose of testing their product for review.
While Japan has been cracking down more on cryptocurrency exchanges recently, we see the state of Wyoming opening things up to make the state more attractive to the technology. At the same time, the SEC defined ICOs as money transmitters and crypto exchanges as money exchange businesses. It is rapidly becoming easier to run afoul of these quickly changing clarifications and find yourself in hot water.
On the lighter side, words such as “cryptocurrency,” “blockchain” and “ICO” are joining “Bitcoin” in the dictionary as officially recognized and defined words.
Featured stories by Amy Castor, Michael Scott, Jay Derenthal and Aaron van Wirdum
Japan is cracking down hard on cryptocurrency exchanges, having just recently penalized seven of them and requiring two to halt operations for one month. Japan’s Financial Services Agency (FSA) announced on March 8, 2018, that it came down on the exchanges due to their failure to provide proper internal control systems. All of the exchanges were ordered to step up efforts to improve security and prevent money laundering.
Of the seven, Coincheck was served with its second business improvement order since the $530 million breach of NEM (XEM) were stolen from it earlier this year. All of the 260,000 users impacted by the theft will be paid back in Japanese yen, based on NEM rates at the time of the theft, the Tokyo-based company said.
In the latest regulatory backlash against ICOs, the SEC has decided that, effectively, anyone who sells tokens is an unregistered money transfer business and anyone issuing an ICO is a money transmitter that is subject to the Bank Secrecy Act. Exchanges also qualify as money services businesses (MSBs) according to FinCEN.
An ICO registered as a security, however, would not be considered a money transmitter. Anyone failing to register with FinCEN and failing to perform KYC AML compliance obligations could face prison under a felony conviction. Employees and investors of ICO companies could be held criminally liable as well.
Wyoming has followed through on HB 70 by a vote of 23–7 and the bill is being sent to the state’s governor for signature. Through this legislation, lawmakers hope to carve out space for tech developers involved in the creation of what are known as “utility tokens.” The exemption would be directed at those utility tokens which are not marketed or promoted as investments and are able to be exchanged for goods and services. The bitcoin-friendly HB 19 is also currently working its way through the Wyoming legislature in an effort to exempt cryptocurrencies from the state’s money transmission laws.
AsicBoost was invented by former CoinTerra CTO Timo Hanke in 2016. The technology takes advantage of a quirk in Bitcoin’s proof-of-work algorithm, which lets miners take a sort of “shortcut” to find a new block. This can be done both overtly as well as covertly.
“Unlike covert forms of merkle grinding, [overt AsicBoost] has no incentives to create smaller blocks, nor does it interfere with upgrades to the Bitcoin protocol,” Halong Mining writes.
While a patent controversy swirled around AsicBoost in the past, the open sourcing of it to BDPL members negates much of that. The feature should allow for a 20 percent improvement in energy efficiency in the DragonMint hardware.
In further signs of the mainstreaming of cryptocurrencies and blockchain technology, those terms as well as “initial coin offering” have been added to the Merriam-Webster Dictionary. The March 5, 2018, announcement included 850 new words, which included these three.
Emily Brewster, associate editor at Merriam-Webster, stated, “In order for a word to be added to the dictionary it must have widespread, sustained and meaningful use. These new words have been added to the dictionary because they have become established members of the English language and are terms people are likely to encounter.” The addition to the Merriam-Webster dictionary of the words cryptocurrency, blockchain and ICO seem to fit those criteria well.
The annual Amazon Web Services conference boasted upwards of 40,000 attendees at the end of November last year. As well as adding an extra day of content, AWS re:Invent 2017 also required a significant footprint expansion to accommodate the large crowd of attendees. The event adopted another hotel and an additional expo hall.
Whether attending for the keynote speakers, deep-dive workshops or the unique networking opportunities, the yearly AWS re:Invent conference is a worthy calendar event for every cloud architect. AWS even provide a Justification Letter template to help attendees gain permission to go— worth remembering for next year. If, like Caylent, you plan to attend this year, we advise booking early. Tickets, hotels, and other venues tend to sell out quickly. Spaces typically become available in early Summer.
In 2017, CEO Andy Jassy made two major announcements in his keynote speech regarding AWS’s 2017 compute offerings: AWS Elastic Container Service for Kubernetes (EKS) and AWS Fargate. These new features emphasize that containers are vitally important first-class citizens not just for AWS, but everyone.
Source: Amazon Web Services
Perhaps one of the most significant announcements coming out of re:Invent is AWS’s new managed Kubernetes service, fully compatible with Elastic Container Service (ECS). Not only is EKS pure vanilla upstream Kubernetes — and as such should work with existing tools and applications out of the box — it paves the way for a fully hosted solution in the future. Currently, its main value proposition lies in removing the burden of self-managing K8 master clusters on top of full integration with existing AWS services.
Given the response to Cloud Native Computing Foundation (CNCF) that 63% of Kubernetes workloads were being deployed to the AWS cloud, it’s no surprise the platform has been its focus in preparation for re:Invent 2017. Amazon EKS will launch with support for Kubernetes 1.7 and three most recent versions before adding any assist for future editions. Apply for preview access here.
As you might expect from an AWS service, EKS will integrate with other AWS logging and audit trail services including CloudWatch Logs and CloudTrail:
For the full spec, check out AWS EKS here.
Source: Amazon Web Services
Potentially more game-changing for AWS, Fargate will provide a full fleet of managed worker containers. The implications of this new managed service are huge. Fargate effectively eliminates the need to administer the underlying infrastructure (e.g., EC2) that has always previously been needed for Amazon’s own ECS and other popular third-party schedulers (i.e., Swarm, Kubernetes, etc.)
Put simply, think of Fargate as Heroku for containers on AWS. There are no servers to manage, and it functions as a full Platform-as-a-Service offering within ECS. The only input necessary is to define the container image, CPU and memory requirements, then determine the networking and IAM policies prior to deployment.
While the announcement was somewhat upstaged by EKS, Fargate has the potential to be an even bigger deal for Amazon is it marks the organization’s position in the growing Containers-as-a-Service (CaaS) market. Initially, Fargate will only support ECS, but there are plans to integrate the service with EKS sometime in 2018. Not long to wait.
Source: Amazon Web Services
For the full spec, check out AWS Fargate here.
Planning on using either of these services? Let us know in the comments if you see these new AWS features fitting into your production environment. As for Caylent, we will be undertaking our own evaluation on EKS and Fargate in the coming months.
Looking for help running containers in the more immediate future? Look no further, Caylent has you covered. Check out our new managed service offering. It’s like having a full-time DevOps Engineer on staff at a fraction of the cost.
Want to begin with AWS on Caylent? Setup a High-Availability Docker Swarm Stack on AWS
Since its debut in 2013, Docker has exploded in popularity, and the company has completely revolutionized the way we manage applications. Articles no longer discuss the reasons why you should be adopting containers, but speak more about dealing with the challenges involved with widespread container development. Containers add speed and boost performance within the development process, but bring additional complexity in the form logging, orchestration, security, and visibility. However, dealing with scaling issues, their ephemeral nature, and the sheer volume of data involved with container clusters are the challenges that container monitoring solutions like Prometheus and Sysdig can help to address.
This guide is designed to help you compare two of the major solutions available for collecting the metrics you need. We’ll examine Prometheus and Sysdig—both highly popular container monitoring solutions—alongside the visualization tools (Grafana and Sysdig Monitor respectively) that complement them both to give you full visibility inside every container.
I’ve created evaluation criteria which assesses the two container monitoring solutions by the ease of deployment; the intricacy of the metrics the tool provides; the aggregation level; and the alerting capability each solution offers. For the visualization tools, I’ve evaluated the installation; the level of integration with its host monitoring solution; how easy it is to customize to your own specifications; and the general layout and feel.
Developed by Soundcloud, Prometheus is an open source self-hosted monitoring solution which offers a wide set of tools for multi-dimensional metrics including aggregation, alerting, storage, and visualization. The query language is flexible and easy to grasp, and you can use the same language for graphing and alerting, making the whole container monitoring task much simpler.
Furthermore, you can also make Prometheus highly available by running identical Prometheus servers in different data centers/zones. That way, if a zone goes down your monitoring system in remaining zones can still be accessed.
To visualize your data, Prometheus recommends Grafana. The two complement each other well as Grafana—just like Prometheus— uses various data source types. It takes a little time to build a fully-fledged dashboard using Grafana, but there’s a ton of documentation available to help you through the process. Plus, once built, Grafana dashboards can also be easily expanded to cover more than one Docker host. To monitor more hosts, simply deploy a node-exporter and a cAdvisor container on each host and tell the Prometheus server to scrape those as well.
The Prometheus ecosystem is huge, which means you can find client libraries for many programming languages including Java, Go, Python, .NET, PHP, Ruby, etc.
Scorecard (Marks out of 5)
Scorecard (Marks out of 5)
Another self-hosted service, Sysdig also provides all the necessary container orchestration tools to simplify Docker monitoring, including metrics aggregation and more.
Sysdig actually comes in two parts: the open source version, which requires you to install kernel headers on your host OS, and the cloud/on-premises aspect, which uses the open version to stream the metrics it collects from Sysdig’s own servers. As the solution hooks into the host’s kernel, it doesn’t rely on getting metrics from the Docker Daemon. In addition, just as when running the Docker Stats command and using cAdvisor, Sysdig’s open source version allows you to get a real-time view of your containers.
Sysdig Monitor—formerly Sysdig Cloud—automatically discovers all the containers in your environment and displays them on your choice of several preconfigured dashboards. It captures application, container, host, and StatsD metrics all with a single collection point. The solution provides great visualization tools for real-time and historical data; in either a graphical or tabular representation of your deployment. As well as being able to drill into containers’ individual processes, the dashboards have great alerting functionality should incidents occur.
Scorecard (Marks out of 5)
Scorecard (Marks out of 5)
Fundamentally, choosing the right container monitoring solution will come down to a number of things. Top of which are going to be your requirements and, probably most importantly, your budget. Of the two monitoring tools, Sysdig (along with Sysdig Monitor) is far easier to setup and get working straight away for you and your team. In comparison, Prometheus and Grafana will require a little more time and patience to get configured—though the payback here is that the solution is then tailored to fit your exact demands.
In addition, Sysdig can become quite costly per year as a hosted solution, while Prometheus is open source and free. Both tools are backed by active communities which can be tapped into for help and support, though Prometheus’ is the larger and more established of the two. In short, the right tool for you will end up being the cost and your preference overall, as both will scale and likely achieve what you need.