I have written earlier about problems in banking security and credit card security issues. But what about some other banking issues?
Banking is Broken: A Financial Revolution is Coming article tells that a trio of startups are seeking to change the way we manage our money, by focusing on the customers traditional banks are ignoring. Banks have been slow to embrace new technology.
Finland’s Holvi, Sweden’s iZettle and Estonias TransferWise all took the stage at the Slush startup conference in Helsinki last week, and while they all offer completely different services, they are share a similar goal – to empower the customers that they believe traditional banks are ignoring.
Holvi offers customers an alternative type of current account, integrating bookkeeping and money management in a clean, simple online interface. TransferWise, founded by the first ever Skype employee Taavet Hinrikus, is looking to bring the essence of Skype’s ethos of offering cut rate international phone calls to the money exchange market. Speaking at Slush last week de Geer said that iZettle was “effectively about democratising card payments.”
Keep in mind that Holvi, TransferWise and iZettle are just three of the hundreds of companies looking to cash-in on the revolution that is coming to the banking industry.
What made the article really interesting to me is that I happen to know one of the Kristoffer Lawson, Founder and CEO of Holvi. I have personally heard the story of how the company was put up, that they were applying the needed license and when they got it. But the article includes some a bold new statement: traditional banks are ignoring 80% of their customers.
Lawson believes that Holvi’s new type of account is “the future of banking” and his company is rethinking what it means to be a bank: Holvi offers customers an alternative type of current account, integrating bookkeeping and money management in a clean, simple online interface. It is designed for use by groups and organisations so they can collaborate, making it ideal for events such as Slush, which used the Holvi system for all its budgeting and ticketing operations this year.
And I have also heard of some other events in Finland do the same. The reason why such events have actively started to use the system is that Lawson had been earlier active on organizing different computer events, so he knows the needs of this type of organizations.
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Tomi Engdahl says:
With deletion of one wallet, $280M in Ethereum wallets gets frozen
Parity multi-signature wallets created since July break, affecting 1M ETH.
https://arstechnica.com/information-technology/2017/11/with-deletion-of-one-wallet-280-m-in-ethereum-wallets-gets-frozen/
Digital currencies and the wallets that hold them have become an increasingly attractive target for digital pickpockets, resulting in millions of real dollars’ worth of lost currency. A $50 million heist of Ethereum currency last year exploiting weaknesses in the cryptocurrency’s underlying software threatened to break the Bitcoin competitor. But a new security bug in a popular Ethereum wallet platform has caused what amounts to a bank freeze on scores of high-value wallets. Today, Parity Technologies Ltd., the developer of cryptographic “wallets” for the digital currencies Bitcoin and Ethereum, announced that an “accidental” triggering of a bug affecting certain Parity wallets had broken them, making it impossible to transfer Ethereum funds out of them.
As a result, 1 million ETH have become frozen in wallets—roughly $280 million (US) worth of digital currency. Of that, about $90 million belongs to Parity founder and former Ethereum core developer Gavin Woods’ Initial Coin Offering (ICO) Polkadot, according to Tuur Demeester, editor in chief at Adamant Research.
The bug specifically affects multi-signature wallets created with a digital contract after July 20. Multi-signature wallets have cryptographic security measures that require multiple users to sign a transaction in order for it to be processed and approved—an approach that allows for escrow contracts to control payments from accounts belonging to a group.
Tomi Engdahl says:
Back to blog
Security Alert
https://paritytech.io/blog/security-alert.html
7 November 2017
Severity: Critical
Product affected: Parity Wallet (multi-sig wallets)
Summary: A vulnerability in the Parity Wallet library contract of the standard multi-sig contract has been found.
Affected users: Users with assets in a multi-sig wallet created in Parity Wallet that was deployed after 20th July.
Following the fix for the original multi-sig issue that had been exploited on 19th of July (function visibility), a new version of the Parity Wallet library contract was deployed on 20th of July. However that code still contained another issue – it was possible to turn the Parity Wallet library contract into a regular multi-sig wallet and become an owner of it by calling the initWallet function. It would seem that issue was triggered accidentally 6th Nov 2017 02:33:47 PM +UTC
Tomi Engdahl says:
Parity calamity! Wallet code bug destroys $280 MEEELLION in Ethereum
Punter ‘accidentally’ borks dozens of strangers’ crypto-currency collections
http://www.theregister.co.uk/2017/11/07/parity_wallet_destroys_280m_ethereum/
There’s a lot of hair-pulling among Ethereum alt-coin hoarders today – after a programming blunder in Parity’s wallet software let one person bin $280m of the digital currency belonging to scores of strangers, probably permanently.
Parity, which was set up by Ethereum core developer Gavin Woods, admitted today that a user calling themselves devops199 had “accidentally” triggered a bug in its multi-signature wallets that hold Ethereum coins. As a result, wallets created after July 20 are now locked down and inaccessible, quite possibly permanently, thus nuking $90m of Woods’ own savings.
Multi-signature wallets mean more than one person has to sign off on a transaction before funds are moved, and are popular with companies and investment groups looking to protect their assets. Unfortunately, Parity’s technology is seriously flawed: in July a hacker managed to exploit errors in the multi-signature code to steal about $30m in Ethereum.
In response to that cockup, Parity updated its wallet software to address the vulnerability, and rolled out a new version. However, that update contained another disastrous bug, one that would lock people out of their wallets. It was set off by devops199 on Monday, affecting anyone who had installed the new code since its release.
In a series of posts on GitHub, devops199 said they were a newbie to the crypto-currency system, and had created a multi-signature wallet in a way the software did not expect.
https://github.com/paritytech/parity/issues/6995
Tomi Engdahl says:
WikiLeaks thanks US government for blocking credit card donations
https://www.techspot.com/news/71764-wikileaks-thanks-us-government-blocking-credit-card-donations.html
Founder of WikiLeaks Julian Assange has taken to Twitter to publicly thank the US government for denying access to credit card and banking systems in 2010. The goal was to prevent money from being funneled to WikiLeaks, but that plan may have ended up backfiring.
Assange claims that as a result of the financial blockade, WikiLeaks switched to accepting Bitcoin donations. Since July 2010, Assange says that he has achieved over a 50,000% return on investments. The Bitcoin address used by WikiLeaks has made of 26,000 transactions and has passed over 4,000 Bitcoins through it.
WikiLeaks now accepts several different cryptocurrencies in attempt to receive donations without using any US banking systems. Bitcoin, Litecoin, Zcash, and Monero are all accepted by the notorious leak site. Due to the nature of Zcash and Monero, it is impossible to know how much money WikiLeaks has received in either of the two currencies.
Tomi Engdahl says:
SegWit2x backers cancel plans for bitcoin hard fork
https://techcrunch.com/2017/11/08/segwit2x-backers-cancel-plans-for-bitcoin-hard-fork/?utm_source=tcfbpage&sr_share=facebook
Advocates for a bitcoin hard fork have now decided to cancel plans for the so-called SegWit2x fork. The bitcoin blockchain was supposed to split into two blockchains in roughly 8 days. But it looks like SegWit2x backers couldn’t convince enough people
Tomi Engdahl says:
Parity’s $280m Ethereum wallet freeze was no accident: It was a HACK, claims angry upstart
And we have evidence to prove it, says biz stiffed out of $1m
https://www.theregister.co.uk/2017/11/10/parity_280m_ethereum_wallet_lockdown_hack/
A crypto-currency collector who was locked out of his $1m Ethereum multi-signature wallet this week by a catastrophic bug in Parity’s software has claimed the blunder was not an accident – it was “deliberate and fraudulent.”
On Tuesday, Parity confessed all of its multi-signature Ethereum wallets – which each require multiple people to sign-off transactions – created since July 20 were “accidentally” frozen, quite possibly permanently locking folks out of their cyber-cash collections. The digital money stores contained an estimated $280m of Ethereum; 1 ETH coin is worth about $304 right now. The wallet developer blamed a single user who, apparently, inadvertently triggered a software flaw that brought the shutters down on roughly 70 crypto-purses worldwide.
That user, known as devops199 on GitHub although has since deleted their account, claimed they created a buggy wallet and tried to delete it. Thanks to a programming blunder in Parity’s code, that act locked down all wallets created after July 20, when Parity updated the multi-signature wallet software following a $30m robbery.
Tomi Engdahl says:
David Z. Morris / Fortune:
Bitcoin Cash’s market cap is up 130%+ in 2 days to about $26B, briefly overtaking Ethereum’s, and Bitcoin Cash’s hashrate has surpassed Bitcoin’s — The cryptocurrency market is experiencing a complex shakeup this weekend, with a recently created digital token called Bitcoin Cash (BCH) …
Bitcoin Is in Wild Upheaval After The Cancellation of the Segwit2x Fork
http://fortune.com/2017/11/12/bitcoin-upheavel-segwit2x-fork/
The cryptocurrency market is experiencing a complex shakeup this weekend, with a recently created digital token called Bitcoin Cash (BCH) up nearly 130% in two days, even after retreating substantially from an even bigger spike. Meanwhile, the original Bitcoin (BTC) is down by roughly 15% over the same span. Bitcoin Cash’s total market value, after briefly overtaking Ethereum’s to make BCH the second most valuable cryptocurrency, now stands at $25 billion.
More profoundly, Bitcoin Cash’s hashrate, or network-wide cryptographic processing power, has surpassed Bitcoin’s.
The swings come in the wake of this week’s cancellation of a ‘hard fork,’ or forced split, of Bitcoin. The proposed fork would have created a new version of Bitcoin, known tentatively as Bitcoin 2x after the upgrade plan behind it, Segwit2x. Bitcoin Cash appears to be attracting investors and network operators, or miners, who had supported the 2x fork.
Tomi Engdahl says:
Stan Higgins / CoinDesk:
Mining begins of Bitcoin Gold, a fork of Bitcoin that aims to thwart specialized mining chips — The newest fork of the bitcoin blockchain is officially live after a rocky start. — Developers for the project, dubbed bitcoin gold, published software for the breakaway cryptocurrency today, releasing the code on GitHub as well.
Bitcoin Gold Goes Live After Bumpy Blockchain Launch
https://www.coindesk.com/bitcoin-gold-goes-live-bumpy-blockchain-launch/
Tomi Engdahl says:
Zen Soo / South China Morning Post:
Chinese online lender WeLab, which tracks users’ mobile data including number and nature of apps installed to determine creditworthiness, raises $220M Series B+
Higher rates for addresses in caps – online lender WeLend reveals how it determines your creditworthiness
http://www.scmp.com/tech/start-ups/article/2119209/higher-rates-addresses-caps-online-lender-welend-reveals-how-it
Proprietary big data and AI tech helps company whittle down delinquency rates
If you are looking to take out a loan from online lending platform WeLend to buy the iPhone X, be warned – should you use only upper-case letters when filling out the address field in your application, you could be charged a higher interest rate.
“We actually match how people fill out addresses with the probability of [them] declaring bankruptcy after a certain number of years,” said Simon Loong, the founder and chief executive of WeLab, the Hong Kong company that operates WeLend.
“The probability of [an applicant] declaring bankruptcy is highest when they fill in their address in capital letters,” he said. “We think this could relate to one’s education level. Every interaction we have with a user gives us insight into their choices, background, and this … helps us better understand individuals.”
Tomi Engdahl says:
Jordan Pearson / Motherboard:
Ethereum startup Parity says it knew about flaw in multi-signature wallets for months but didn’t address it, leading to $150M+ in lost ether
Ethereum Wallet Company Knew About Critical Flaw That Let a User Lock Up Millions
https://motherboard.vice.com/en_us/article/d3djwj/ethereum-wallet-parity-knew-about-critical-flaw-that-let-user-devops199-lock-up-millions
Parity released its postmortem of the incident on Wednesday.
After someone going by “Devops199” managed to permanently lock up millions of dollars worth of other people’s Ethereum funds last week, the company that created the vulnerable code published a postmortem on the incident on Wednesday. It doesn’t look good.
According to Parity’s breakdown of the fiasco, the digital wallet company knew about the critical flaw since August and did not address it for months, until it was too late.
This much we already knew: Parity suffered a massive hack due to a critical vulnerability in mid-July, prompting it to push out new code on July 20th.
That wallet was actually a code library for Parity multi-signature wallets, making them instantly useless and permanently freezing the funds inside.
At the moment, there is still no fix to free the locked funds.
That’s because it happened before. After an Ethereum project called the DAO lost more than $50 million to a hacker in 2016, the funds were recovered via a hard fork network split, a move that spurred part of the Ethereum community to rebel and work on their own version of Ethereum, now called Ethereum Classic.
Tomi Engdahl says:
Jeff Gitlen / LendEDU:
Online survey of 564 US Bitcoin owners: 16% plan to hold investment for less than a year, 67% haven’t sold any, 36% don’t plan on reporting purchase to the IRS
Investing in Bitcoin: Survey & Report
https://lendedu.com/blog/investing-in-bitcoin
The price of Bitcoin has risen dramatically since the start of the year. The virtual currency now trades at $6,490 (as of 11/13), up from $997 at the start of 2017. While the price of Bitcoin is off its high of $7,500, there have been no signs of slowing media coverage, headlines, or new investor demand.
Raw Survey Results
1. Which of the following best describes the reason you invested in Bitcoin?
a. 21.81% of respondents answered “Bitcoin is a long term store of value, like gold or silver.”
b. 40.78% of respondents answered “I believe Bitcoin is a world changing technology.”
c. 14.01% of respondents answered “I believe that the price of Bitcoin is too low, and will only go higher.”
d. 15.25% of respondents answered “A friend, family member, or another trustworthy source convinced me to invest.”
e. 8.16% of respondents answered “I plan on using Bitcoin for transactions or purchases, and less of an investment.”
2. What is the current value ($) of your Bitcoin investment?
On average, respondents reported that the current value of their Bitcoin investment was $2,930.85. At the time of the survey completion, the price per Bitcoin was $6,490.
3. How long do you plan to hold your Bitcoin investment?
a. 16.49% of respondents answered “Less than 1 year”
b. 39.54% of respondents answered “1 to 3 years”
c. 22.34% of respondents answered “4 to 6 years”
d. 9.93% of respondents answered “7 to 10 years”
e. 11.70% of respondents answered “Over 10 years”
4. Do you routinely worry about the technological security of your Bitcoin investment?
a. 44.15% of respondents answered “Yes”
b. 55.85% of respondents answered “No”
Tomi Engdahl says:
100 cryptocurrencies described in four words or less
https://techcrunch.com/2017/11/19/100-cryptocurrencies-described-in-4-words-or-less/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
There are many. Some are landmarks. Some are scams.
Tomi Engdahl says:
Ethereum Blockchain Coder Neufund Nabs $11.6M Pre-Sale Funding Round, Preps for ICBM
https://www.crowdfundinsider.com/2017/11/124360-ethereum-blockchain-coder-neufund-nabs-11-6m-pre-sale-funding-round-preps-icbm/
Tomi Engdahl says:
An Ethereum Startup Just Vanished After People Invested $374K
“These were very good scammers.”
https://motherboard.vice.com/en_us/article/j5j34x/ethereum-startup-confido-vanished-after-people-invested-374k-ico
A startup on the Ethereum platform vanished from the internet on Sunday after raising $374,000 USD from investors in an Initial Coin Offering (ICO) fundraiser.
Confido is a startup that pitched itself as a blockchain-based app for making payments and tracking shipments. It sold digital tokens to investors over the Ethereum blockchain in an ICO that ran from November 6 to 8. During the token sale, Confido sold people bespoke digital tokens that represent their investment in exchange for ether, Ethereum’s digital currency.
But on Sunday, the company unceremoniously deleted its Twitter account and took down its website. A company representative posted a brief comment to the company’s now-private subforum on Reddit, citing legal problems that prevent the Confido team from continuing their work.
Even the Confido representative on Reddit doesn’t seem to know what’s going on
Confido tokens had a market cap of $10 million last week, before the company disappeared, but now the tokens are worthless. And investors are crying foul.
“I got scammed big time,” user cioloxl wrote in the Confido thread on popular cryptocurrency forum Bitcointalk. “This was a very valuable lesson for me, in both senses of the word.” Another user, masternode, was more measured, but no less angry. “This is a punch in every single investor’s face,” they wrote.
SEC accuses two digital coin creators of ripping off investors
It has charged cryptocurrency-backed real estate and diamond companies owned by one businessman.
https://www.engadget.com/2017/10/01/sec-charges-initial-coin-offerings/
While initial coin offerings aren’t prohibited in the US like they are in China and South Korea, authorities are still keeping a close eye on them. Case in point: the US Securities and Exchange Commission’s first ICO-related charges brought against a businessman and his two companies. SEC has accused Maksim Zaslavskiy of defrauding investors by selling virtual currencies backed by assets that don’t exist.
Zaslavskiy advertised his first company called REcoin Group Foundation as “The First Ever Cryptocurrency Backed by Real Estate.”
After the government started interfering in REcoin’s activities, he founded the Diamond Reserve Club, which promised to use people’s money to invest in diamonds. SEC said DRC never invested in diamonds and never even started its business operations, but it acted as if it had done both while soliciting investors.
“Investors should be wary of companies touting ICOs as a way to generate outsized returns. As alleged in our complaint, Zaslavskiy lured investors with false promises of sizeable returns from novel technology.”
Tomi Engdahl says:
Tether, a startup that works with bitcoin exchanges, claims a hacker stole $31M
https://techcrunch.com/2017/11/20/tether-claims-a-hacker-stole-31m/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Bitcoin cruised past $8,000 for the first time this week, but it hasn’t been smooth sailing for all after Tether — a company that helps exchanges convert fiat currency to token — said today that a hacker snatched nearly $31 million.
Tomi Engdahl says:
Nathaniel Popper / New York Times:
Bitfinex’s inadequate disclosures of 2016 hack and unclear ownership links to Tether, issuer of popular coins used to buy bitcoin, raise doubts about exchange
Warning Signs About Another Giant Bitcoin Exchange
https://www.nytimes.com/2017/11/21/technology/bitcoin-bitfinex-tether.html
As the price of Bitcoin has soared, the virtual currency has edged toward the mainstream.
Square, the fast-growing payments company run by the Twitter co-founder Jack Dorsey, has begun selling Bitcoins to ordinary consumers, and the Chicago Mercantile Exchange will soon allow banks to trade on the value of Bitcoin.
Bitfinex, which is officially incorporated in the British Virgin Islands, has been fined by regulators in the United States and cut off by American banks, and it has lost millions of dollars of customer money in two separate hackings, leading critics to question whether it even has the money it claims to hold.
In the latest blow, on Tuesday, an alternative virtual currency that is owned and operated by the same people as Bitfinex, known as Tether, announced that it had been hacked and lost around $30 million worth of digital tokens.
None of that has been enough to stop customers from pumping billions of dollars worth of virtual currency trades through Bitfinex in recent weeks
Even many people who believe in virtual currencies worry that the mixture of loose controls and booming trading at the world’s largest exchange is likely to cause trouble for all the investors piling into virtual currencies, even those who don’t go near Bitfinex.
Tomi Engdahl says:
Jordan Pearson / Motherboard:
Ethereum startup Confido, which pitched itself as a blockchain-based app for making payments and tracking shipments, goes dark after raising $374K in ICO
An Ethereum Startup Just Vanished After People Invested $374K
“These were very good scammers.”
https://motherboard.vice.com/en_us/article/j5j34x/ethereum-startup-confido-vanished-after-people-invested-374k-ico
A startup on the Ethereum platform vanished from the internet on Sunday after raising $374,000 USD from investors in an Initial Coin Offering (ICO) fundraiser.
Confido is a startup that pitched itself as a blockchain-based app for making payments and tracking shipments. It sold digital tokens to investors over the Ethereum blockchain in an ICO that ran from November 6 to 8. During the token sale, Confido sold people bespoke digital tokens that represent their investment in exchange for ether, Ethereum’s digital currency.
But on Sunday, the company unceremoniously deleted its Twitter account and took down its website. A company representative posted a brief comment to the company’s now-private subforum on Reddit, citing legal problems that prevent the Confido team from continuing their work. The same message was also posted to Medium but quickly deleted.
Tomi Engdahl says:
How to talk about cryptocurrency at the holiday dinner table
https://techcrunch.com/2017/11/20/how-to-talk-about-cryptocurrency-at-the-holiday-dinner-table/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Tomi Engdahl says:
Bitcoin is over $9,000
https://techcrunch.com/2017/11/26/bitcoin-is-over-9000/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Well, it’s over $9,000.
Even as you recoup from attempting to explain Bitcoin to your family over the Thanksgiving dinner table, the value of the cryptocurrency is growing at an increasingly hefty pace. As of the time of this writing, the value of a single Bitcoin was above $9,143, climbing nearly 6 points in the past 24 hours.
My colleague Fitz Tepper said the case for Bitcoin at $10k was pretty strong by year’s end when it hit $8,000 just six days ago
Tomi Engdahl says:
Bitcoin Guns for $10,000 as Cryptocurrency Mania Defies Skeptics
https://www.bloomberg.com/news/articles/2017-11-26/bitcoin-surges-past-9-000-as-euphoria-reaches-a-fever-pitch?utm_content=buffer38933&utm_medium=social&utm_source=facebook.com&utm_campaign=buffer
This year’s 10-fold increase adds to 120% gain in 2016
Institutional investors seen entering
Bitcoin blew past $9,700 just a week after topping $8,000 and approached its closest ever to five figures, gaining mainstream market attention as it defies bubble warnings
Tomi Engdahl says:
ICOs: The Lawless Land of Cryptocurrency Fundraising
http://www.securityweek.com/icos-lawless-land-cryptocurrency-fundraising
From raising $30 million in 30 seconds to being endorsed by Paris Hilton or vanishing into thin air: anything is possible in the risky new world of cryptocurrency fundraising, but regulators are lurking.
Bypassing oversight of any kind, Initial Coin Offerings (ICOs) have sprung from nowhere to become a hugely popular way for start-ups to raise funds online, offering self-created digital “tokens” or coins to any willing buyer.
ICOs herald “the democratisation of investment”, said Nil Besombes, a French blogger specialized in digital currencies.
But in the lawless Wild West of ICOs, the risks are legion and Besombes himself admits to losing “the equivalent of 1,800 euros” when he fell for a slick online sales pitch — only for the company to disappear without a trace.
“It’s like gambling,” he told AFP.
ICOs are thus essentially a form of crowdfunding where participants are betting that the value of their “tokens” will go up and that they will eventually be able to trade them for established cryptocurrencies like bitcoin and Ethereum, which can in turn be exchanged for traditional currencies.
Tomi Engdahl says:
Almost all of the crypto-wallet applications are leaking
The use of cryptographic currencies is becoming more and more common, and recently, for example, Bitcoin’s value has risen rapidly. According to an analysis by the American security company, most of the most popular mobile apps for cryptographic currencies downloaded on Google Play were insecure.
The analysis of High-Tech Bridge had more than 2000 cryptographic swapping applications. The most popular, or more than half a million downloads of applications by as much as 94 percent contained at least three medium-level vulnerability. 77% of applications had at least three serious vulnerabilities.
The most common security issues associated with data are unprotected storage. Another important vulnerability is inadequate data encryption.
Source: http://www.etn.fi/index.php/13-news/7243-lahes-kaikki-kryptovaluuttasovellukset-vuotavat
More:
How secure are the most popular crypto currencies mobile apps?
https://www.htbridge.com/news/security-cryptocurrency-mobile-apps.html
We tested the most popular crypto currency mobile apps from Google Play for common vulnerabilities and weaknesses. Over 90% may be in trouble.
Over 1300 crypto currencies exist today with over $328,331,711,597 market capitalization (at the moment of this post publication). One of the most popular and oldest cryptocurrency – Bitcoin has reached $10,000 price after several months of fluctuation, but continuous and steady growth.
A wide spectrum of mobile applications for crypto currencies were released during the last few years by various startups, independent digital experts and even licensed banking institutions. The total number of crypto currency applications in Google Play designed to store, process or trade crypto currencies has exceeded two thousand and continues to grow.
Obviously, cybercriminals could not pass on such an outstanding opportunity and are aggressively targeting all possible stakeholders of the emerging digital currency market.
Tomi Engdahl says:
Coinbase Obtains Partial Victory Over IRS
https://blog.coinbase.com/coinbase-obtains-partial-victory-over-irs-dac041db59a3
Coinbase appeared in federal court this month in the continued fight with the IRS over our customers’ privacy. You can read more in this blog.
We are pleased to say Coinbase won a partial victory in court today. Although the Court did not completely quash the government summons compelling disclosure of certain customers’ records from the period 2013–2015 as we requested, we were proud to accomplish two important victories for our customers.
Tomi Engdahl says:
Don’t expect AWS to launch a blockchain service anytime soon
https://techcrunch.com/2017/11/29/dont-expect-aws-to-launch-a-blockchain-service-anytime-soon/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Bitcoin may be reaching for new heights, but don’t expect AWS to launch a service that’s based on the underlying blockchain technology anytime soon. During a press conference at AWS’ annual re:Invent conference in Last Vegas, AWS CEO Andy Jassy took a question on his team’s plans for a blockchain service.
Jassy seemed anything but enthused about the prospect. In his view, there aren’t a lot of use cases of the blockchain “beyond the distributed ledger.” He also stressed that AWS doesn’t “build technology because we think it is cool.”
Tomi Engdahl says:
Understanding Ethereum Smart Contracts
http://www.gjermundbjaanes.com/understanding-ethereum-smart-contracts/
You might have heard the term “smart contract,” and you might even know that they are “code” you can run on a blockchain.
But how can you run code on a blockchain? It’s not the easiest concept to wrap your head around.
This post explains how smart contracts work on the Ethereum Blockchain.
Without going into too much detail, the central concept of Blockchain technology is a distributed ledger. It’s a particular type of database that is shared among many participants.
This special database is just a list of transactions. Every transaction that has ever happened in the network. Everybody can have their own copy. This distribution coupled with strong monetary incentives removes the need for trust between parties.
put your trust in a network where the want to cheat is removed by strong incentives (in short: it’s much more profitable to stay within the rules).
Since everybody has the same list, it is hard to fool the network into accepting false transactions. Combine this with some cryptographic algorithms and monetary incentives to follow the rules, and you get a pretty secure network.
The only way to change the history is for most of the network to agree to do it.
contract?
The main thing that makes Ethereum different than Bitcoin is that Ethereum has the concept of smart contracts. Bitcoin is digital money; store of value. Ethereum is also digital money, but so much more.
The name “Smart Contract” is a bit misleading. They are not really contracts, and they are not particularly smart either. They are just pieces of code – or computer logic – that can run on the blockchain…
The code of the smart contract is compiled byte-code that Ethereum clients and nodes can run. It is the code that is executed on the creation of the smart contract, and it contains functions that you can call. Just like any object in an object-oriented programming language.
The execution of code is being paid by the caller in something called gas. Gas is the fuel that runs the Ethereum Virtual Machine. You can think of it as payment per execution of instruction (almost like a line of code).
When a smart contract has been deployed to the Ethereum network, anyone can call the functions of the smart contract. The function may have security features that block people from using it, but you are free to try.
One thing to keep in mind though: while smart contracts are Turing complete and can, in theory, do anything, they are not well suited to heavy computational work.
The Ethereum World Computer is like an old slow computer that can run simple programs. And it is vital to keep Ethereum Smart Contracts small and simple because of cost and security.
The more computation a contract demands, the more it costs to run it. The more complex a contract is, the more likely it is to have security holes. And a security breach in your smart contract is very hard to do anything about – the blockchain is immutable after all.
Tomi Engdahl says:
Decision time is here for blockchain, but are enterprises ready?
http://www.zdnet.com/article/for-blockchain-decision-time-approaches/
Blockchain may help deliver the open transactions and innovation we’ve long been promised. But there may be plenty of friction getting there.
Blockchain — the purportedly immutable global database — has been in the headlines for several years now, and it’s looking like 2018 will be the year that IT and business leaders have to decide whether to move forward in a serious way with it. That means, of course, committing both budget dollars and peoples’ time building out capabilities.
It also means — and this is a huge part of it — getting organizational buy-in to the approach. The rise of blockchain-savvy disruptors may help push the issue, but until that happens, business and IT leaders may resist the idea of tearing up current processes embedded within current infrastructures.
Skills and knowledge is essential, of course, and it’s going to take time for these to be available. There are signs of a growing base of skills and expertise in the blockchain space. A recent report from Upwork, for example, indicates that blockchain is the second-fastest growing base of skillsets on its list of the top 20 skills now available from independent talent, right behind robotics. While it is still linked to Bitcoin, it’s worth noting that blockchain has potential well beyond the cyber-currencies, with the ability to assure smart contracts within supply chains, the Internet of Things, financial documents, and a range of other people-to-machines or machine-to-machine interactions.
Blockchain, because it is based on a common, open network, represents the next step over the internet as we’ve known it. “There is a complex web of archaic processes, legacy systems, and misaligned incentives intra-and inter-company within the value chain of an industry,” notes Josep Lluis de la Rosa and a team of co-authors in a recent paper.
Tomi Engdahl says:
US Senate Bill S.1241 to Criminalize Concealed Ownership of Bitcoin
https://btcmanager.com/us-senate-bill-s-1241-criminalize-concealed-ownership-bitcoin/
bill S.1241 itself would amend the definition of ‘financial institution’ in the United States Code to include digital currencies and digital exchanges. This could have alarming consequences for users of cryptocurrencies both in the US and abroad
The US senate is proposing a bill to make criminals out of anyone intentionally concealing ownership or control of a digital currency or digital exchange account. What’s more, according to the hearing’s prolonged discussion of US law enforcement’s handling of foreign banks and financial institutions, this bill is certain to have far-reaching effects on not only US citizens but the global community as a whole.
If the above statement describes you, it is strongly recommended that you watch the hearing with this new definition of ‘financial institution’ in mind. If you’ve already watched the hearing, watch it again, but this time replace all mentions of ‘banks and financial institutions’ with ‘digital currencies and digital exchanges.’ The implications are really rather alarming.
Indeed it will be “very, very interesting to see what goes forward.” If this bill passes, how many of you future criminals out there are still set on hodling?
Tomi Engdahl says:
Bitcoin Bubble Burst will warn you if the bitcoin dream is about to crash down
https://techcrunch.com/2017/12/03/bitcoin-bubble-burst-will-warn-you-if-the-bitcoin-dream-is-about-to-crash-down/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Whether you’re a bitcoin believer or a vulture waiting to have your bubble predictions proved right, you’re probably keeping one nervous eye on the charts in anticipation of the crash everyone seems to expect any second now. Bitcoin Bubble Burst, presented today at the Disrupt Berlin hackathon, lets you you focus on other things, while it watches for major price changes and news events that could affect prices and alerts you in real time.
https://bitcoinbubbleburst.github.io/#overview
Tomi Engdahl says:
Metascarcity and Bitcoin’s future
https://techcrunch.com/2017/12/03/metascarcity-and-bitcoins-future/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&sr_share=facebook
The problem with writing about Bitcoin is that the subject has become so emotional. The very name inspires triumph, greed, resentment, or fury. Triumph from those handful of hodlers (yes, really) who are watching the destiny they long foretold actually come true before those eyes. Greed from those hundreds of thousands of newbies who just bought in. Those two groups are, of course, bitcoin believers.
Tomi Engdahl says:
What Bitcoin has introduced to the world is, essentially, digital scarcity — but you’ll notice that there are a whole lot of blockchains and cryptocurrencies out there now … in short, ironically, we are seeing something of a glut of scarcity. Other chains can do things which Bitcoin can’t; ZCash’s powerful cryptographic anonymity, Ethereum’s Turing-complete scripting language. More chains are coming online every month.
Source: https://techcrunch.com/2017/12/03/metascarcity-and-bitcoins-future/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&sr_share=facebook
Tomi Engdahl says:
People have spent over $1M buying virtual cats on the Ethereum blockchain
https://techcrunch.com/2017/12/03/people-have-spent-over-1m-buying-virtual-cats-on-the-ethereum-blockchain/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Launched a few days ago, CryptoKitties is essentially like an digital version of Pokemon cards but based on the Ethereum blockchain. And like most viral sensations that catch on in the tech world, it’s blowing up fast.
People are spending a crazy amount of real money on the game. So far about $1.3M has been transacted, with multiple kittens selling for ~50 ETH (around $23,000) and the “genesis” kitten being sold for a record ~246 ETH (around $113,000).
MenuTechCrunch
People have spent over $1M buying virtual cats on the Ethereum blockchain
Posted yesterday by Fitz Tepper (@fitztepper)
Launched a few days ago, CryptoKitties is essentially like an digital version of Pokemon cards but based on the Ethereum blockchain. And like most viral sensations that catch on in the tech world, it’s blowing up fast.
Built by Vancouver and San Francisco-based design studio AxiomZen, the game is the latest fad in the world of cryptocurrency and probably soon tech in general.
People are spending a crazy amount of real money on the game. So far about $1.3M has been transacted, with multiple kittens selling for ~50 ETH (around $23,000) and the “genesis” kitten being sold for a record ~246 ETH (around $113,000). This third party site tracks the largest purchases made to date on the game. And like any good viral sensation prices are rising and fluctuating fast. Right now it will cost you about .03 ETH, or $12 to buy the least expensive kitten in the game.
So now we have people using Ether, an asset with arguably little tangible utility – to purchase an asset with unarguably zero tangible utility. Welcome to the internet in 2017.
In all seriousness, it’s a little bit reminiscent of the beanie baby trend where people were paying insane amounts of money for stuffed animals. But if the popularity continues to increase these people may be able to make a return by reselling or breeding their rare kittens, or they’ll be stuck holding the virtual cryptographic keys to a virtual rare kitten when the market crashes in a few days, like eventually happened with beanie babies.
Tomi Engdahl says:
SEC Files Charges in Digital Currency Investment Scam
http://www.securityweek.com/sec-files-charges-digital-currency-investment-scam
The US Securities and Exchange Commission said Monday its newly-created Cyber Unit shut down a digital currency investment scam, charging a company that took millions from investors, “falsely promising” a speedy, 13-fold profit.
The SEC’s Cyber Unit filed charges against and froze the assets of Dominic Lacroix, a Canadian with a history of securities law violations, and his company PlexCorps in an initial coin offering fraud.
Using Facebook, the company sold securities called PlexCoin — that its website billed as “the next cryptocurrency” — to investors in the US and elsewhere, raising $15 million since August, and promising a return of 1,354 percent within 29 days, the SEC said in a statement.
These were the first charges filed by the unit the SEC created in September to focus on fraudulent initial coin offerings of digital currency and other crimes.
Tomi Engdahl says:
Jeff John Roberts / Fortune:
SEC’s new cyber unit dedicated to ICOs files its first charges over a scam by PlexCoin, which reportedly raised $15M and promised 13-fold profit within a month — A new division of the Securities and Exchange Commission dedicated to so-called “initial coin offerings” (ICOs) …
The SEC’s New Cyber Unit Just Filed Its First Charges Over an ICO Scam
http://fortune.com/2017/12/04/cryptocurrency-bitcoin-sec-ico-scam/
Tomi Engdahl says:
Nick Baker / Bloomberg:
CBOE says it will start bitcoin futures trading on Dec. 10, eight days before the exchange operator’s larger Chicago rival CME said it would start
Cboe Says It Will Start Bitcoin Futures Trading on Dec. 10, Giving it a Week of Exclusivity
https://www.bloomberg.com/news/articles/2017-12-04/cboe-says-it-will-start-bitcoin-futures-trading-on-dec-10
Cboe Global Markets Inc. said Monday it will start trading bitcoin futures on Dec. 10, after getting the green light last week from regulators.
That gives Cboe a week of exclusivity. The exchange operator’s larger Chicago rival CME Group Inc. has said its contracts will begin trading Dec. 18.
The introduction of futures from both Cboe and CME may entice more professional traders and investors to join the cryptocurrency market by shifting transactions onto regulated exchanges.
Tomi Engdahl says:
Nordea joins the blockade chain – a founding member of the first blockchain trade finance system
Nordea has announced that it has become a founding member of the we.trade consortium. The consortium develops a distributed system of accounts distributed by IBM with a distributed Ledger technology. It is the first block-based trade finance system.
We.trade is an open system that other banks can join. The aim of the founding members is to create trade-friendly standards for the entire banking sector.
We.traden is expected to be available early in 2018, but test customers will have access to the system earlier.
According to the information, other founding members of the we.trade consortium are Banco Santander, Deutsche Bank, HSBC, KBC, Natixis, Radobank, Société Générale and UniCredit.
Source: http://www.tivi.fi/Kaikki_uutiset/nordea-lahtee-mukaan-lohkoketjubisnekseen-perustajajaseneksi-ensimmaiseen-trade-finance-jarjestelmaan-6690784
Tomi Engdahl says:
Revolut merges mobile banking with cryptocurrency trading
https://techcrunch.com/2017/12/05/revolut-cryptocurrency/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Revolut is merging traditional banking and cryptocurrency to let you buy, sell, trade, and hold Bitcoin, Litecoin, and Ether alongside 25 world fiat currencies. The $90 million-funded mobile banking startup is trying to erase the divide between old and new money.
Tomi Engdahl says:
New in Finland: Fitbit, known for activity braclets, challenges Apple Pay
The usage of the watch expands when the Fitbit Pay fee came to Finland in late November. The fee works with Fitbit’s Ionic watch. At least so far, Fitbit Payn can only introduce Danske Bank customers in Finland.
Fitbit Pay works in all stores with a near charge. Payment is made by opening the payment view and by displaying the clock on the local reader. To ensure safety, the user must enter the PIN code in the watch.
Fitbit Pay will compete with, among other things, the banks’ own phone applications and Apple’s Payn launched earlier in the autumn. Where bank applications only run on Android phones and Apple Pay iOS devices, Fitbit Pay does not discriminate against either platform. The clock supports Android phones and iPhone, which means that payment can be made regardless of the device. The biggest limiting factor is limited bank support.
Source: http://www.tivi.fi/Kaikki_uutiset/uutta-suomessa-aktiivisuusrannekkeista-tuttu-fitbit-haastaa-apple-payn-6690836
Tomi Engdahl says:
Steam is no longer supporting Bitcoin
http://steamcommunity.com/games/593110/announcements/detail/1464096684955433613
As of today, Steam will no longer support Bitcoin as a payment method on our platform due to high fees and volatility in the value of Bitcoin.
Tomi Engdahl says:
David Meyer / Fortune:
Bitcoin price reaches $16K+ despite bubble warnings, with a total market capitalization of ~$270B
Bitcoin Blasts Through $15,000 Barrier Despite Bubble Warnings
http://fortune.com/2017/12/07/bitcoin-price-15000-bubble-warnings/
Bitcoin broke through the $15,000 barrier on Thursday morning as it continued what has been a remarkable run even by the cryptocurrency’s usual bubblelicious standards.
At the time of writing, shortly before 5.30 am ET, the price of one bitcoin was listed on Google’s bitcoin tracker as $15,130, and on CoinMarketCap as $15,316, with a total market capitalization of $256 billion. Coindesk had it at a slightly more modest $14,800.
A reminder: a bitcoin was worth $10,000 little more than a week ago, and it only passed the $13,000 mark on Wednesday. It started the year with a value of around $1,000, so the virtual currency’s trajectory is curving up sharply.
Bitcoin: Coinbase Goes Down Amid Skyrocketing Prices
http://fortune.com/2017/12/07/bitcoin-coinbase-down-valuation/
Popular cryptocurrency exchange Coinbase is having a rough Thursday morning amid bitcoin’s huge gain in price.
The company said via Twitter that its service is “currently experiencing record high traffic” that is “resulting in some customers having slow performance or issues logging into their Coinbase.com accounts.”
Tomi Engdahl says:
Coinbase hits top spot on Apple’s US App Store despite struggling to handle bitcoin demand
https://techcrunch.com/2017/12/07/coinbase-hits-top-spot-on-apples-us-app-store/
Tomi Engdahl says:
Why is bitcoin’s price so high?
https://techcrunch.com/2017/12/08/why-is-bitcoins-price-so-high/?utm_source=tcfbpage&sr_share=facebook
Tomi Engdahl says:
Preparing your organization for a future built on blockchain
https://opensource.com/open-organization/17/12/blockchain-revolution-part-2?sc_cid=7016000000127ECAAY
Smart contracts. Distributed Autonomous Enterprises. Computerized Autonomous Agents. These aren’t just buzzwords. They’re the future of your open organization.
Tomi Engdahl says:
Is blockchain a security topic?
https://opensource.com/article/17/12/blockchain-security-topic?sc_cid=7016000000127ECAAY
Yet again, we need to understand how systems and the business work together and be honest about the fit.
Tomi Engdahl says:
The Bitcoin Whales: 1,000 People Who Own 40 Percent of the Market
A few massive investors can rock it with a shrug.
https://www.bloomberg.com/news/articles/2017-12-08/the-bitcoin-whales-1-000-people-who-own-40-percent-of-the-market
On Nov. 12, someone moved almost 25,000 bitcoins, worth about $159 million at the time, to an online exchange. The news soon rippled through online forums, with bitcoin traders arguing about whether it meant the owner was about to sell the digital currency.
Holders of large amounts of bitcoin are often known as whales. And they’re becoming a worry for investors. They can send prices plummeting by selling even a portion of their holdings. And those sales are more probable now that the cryptocurrency is up nearly twelvefold from the beginning of the year.
About 40 percent of bitcoin is held by perhaps 1,000 users; at current prices, each may want to sell about half of his or her holdings
Tomi Engdahl says:
Frank Chaparro / Business Insider:
Coinbase CEO says exchange services may be “degraded or unavailable” during high volume or volatile trading sessions, after recent downtime incidents — – Coinbase, the cryptocurrency trading platform, experienced an outage on Thursday as bitcoin soared by $3,000 in under three hours on its platform.
Coinbase warns that its platform could crash again in the future
http://nordic.businessinsider.com/coinbase-warns-platform-could-crash-again-2017-12?op=1&r=US&IR=T
Tomi Engdahl says:
Adrianne Jeffries / The Outline:
The current Bitcoin economy has mainly replicated core aspects of a centralized finance industry instead of giving rise to a true p2p financial system — The cryptocurrency was supposed to replace the finance industry. Instead, it has replicated it.
Bitcoin is none of the things it was supposed to be
The cryptocurrency was supposed to replace the finance industry. Instead, it has replicated it.
https://theoutline.com/post/2592/bitcoin-is-none-of-the-things-it-was-supposed-to-be
On Thursday, the price of Bitcoin fluctuated by thousands of dollars in a 24-hour period. The Coinbase app — which lets you buy and sell cryptocurrencies, and is the number two free app in the App Store as of this writing — started freezing and throwing errors, which the company said was due to high traffic. At one point, I tested the app by trying to sell some of my (very small) amount of Bitcoin, and the app simply buckled. “Bitcoin sales are temporarily disabled,” it said in an error message.
This is not how Bitcoin was supposed to work.
In fact, most of the current Bitcoin economy, worth around $276 billion at the time of writing, is antithetical to the premise of Bitcoin.
Adrianne Jeffries
Dec—08—2017 01:33PM EST
On Thursday, the price of Bitcoin fluctuated by thousands of dollars in a 24-hour period. The Coinbase app — which lets you buy and sell cryptocurrencies, and is the number two free app in the App Store as of this writing — started freezing and throwing errors, which the company said was due to high traffic. At one point, I tested the app by trying to sell some of my (very small) amount of Bitcoin, and the app simply buckled. “Bitcoin sales are temporarily disabled,” it said in an error message.
This is not how Bitcoin was supposed to work.
In fact, most of the current Bitcoin economy, worth around $276 billion at the time of writing, is antithetical to the premise of Bitcoin.
Macallan Rare Cask
Let’s go back to the beginning of Bitcoin. The first stop for anyone seriously interested in Bitcoin is the Bitcoin white paper: the canonical document written by Bitcoin’s pseudonymous creator, Satoshi Nakamoto, in 2008. “I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party,” Nakamoto wrote
https://bitcoin.org/bitcoin.pdf
Tomi Engdahl says:
Olga Kharif / Bloomberg:
Experts estimate that about 1,000 users, known as “whales”, control 40% of bitcoins, raising concerns whales may collude to manipulate cryptocurrency markets — A few massive investors can rock it with a shrug. — On Nov. 12, someone moved almost 25,000 bitcoins …
The Bitcoin Whales: 1,000 People Who Own 40 Percent of the Market
A few massive investors can rock it with a shrug.
https://www.bloomberg.com/news/articles/2017-12-08/the-bitcoin-whales-1-000-people-who-own-40-percent-of-the-market
On Nov. 12, someone moved almost 25,000 bitcoins, worth about $159 million at the time, to an online exchange. The news soon rippled through online forums, with bitcoin traders arguing about whether it meant the owner was about to sell the digital currency.
Holders of large amounts of bitcoin are often known as whales. And they’re becoming a worry for investors. They can send prices plummeting by selling even a portion of their holdings. And those sales are more probable now that the cryptocurrency is up nearly twelvefold from the beginning of the year.
About 40 percent of bitcoin is held by perhaps 1,000 users; at current prices, each may want to sell about half of his or her holdings
Regulators have been slow to catch up with cryptocurrency trading, so many of the rules are still murky. If traders not only pushed the price up but also went online to spread rumors, that might count as fraud. Bittrex, a digital currency exchange, recently wrote to its users warning that their accounts could be suspended if they banded together into “pump groups” aimed at manipulating prices. The law might also be different for other digital coins.
Tomi Engdahl says:
Bitcoin futures are now tradable on the CBOE
https://techcrunch.com/2017/12/10/bitcoin-futures-are-now-tradable-on-the-cboe/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Tomi Engdahl says:
Why is everyone talking about kitties and what do they have to do with Ethereum?
https://medium.com/@exantebroker/why-is-everyone-talking-about-kitties-and-what-do-they-have-to-do-with-ethereum-d9a6616c9a08
The online world in general and the crypto community specifically have been abuzz about CryptoKitties the last 24 hours. They’re super cute, and they’re slowing down the Ethereum network. What are they and how on earth did we get ourselves in a situation in which they can crash the foundation of the second largest cryptocoin?
Cryptokitties are a blockchain based cat breeding game created by a company called AxiomZen. Users can purchase kitties and swap them with other players. It is also possible to breed new kitties, some of which have unique characteristics. These ones are being traded for being traded for astronomical prices, with fans paying more than 50 ether for a virtual cat.
tion to incentivise miners. But after Vitalik Buterin endorsed CryptoKitties by claiming that they illustrated the fact that blockchains are important to stand up to governments — or whatever word salad this was — the congestion only intensified.
The fact is is that a single viral pussy game based on the ERC-20 token standard can slow down the entire Ethereum network, which probably proves the opposite of what Buterin was trying to say. It also functions as a stark reminder that cryptocurrencies, despite the hype and the very real amounts of serious money going around are still in its infancy and have a long way to go.
Tomi Engdahl says:
The Bulgarian Government Is Sitting on $3 Billion in Bitcoin
https://www.coindesk.com/bulgarian-government-sitting-3-billion-bitcoin/
A crackdown on organized crime by Bulgarian law enforcement in May resulted in the seizure of more than 200,000 bitcoins – an amount worth more than $3 billion at today’s prices.
What remains unclear at this time is what the Bulgarian government is doing with the seized bitcoins.
Notable in the May 19 release is a notation that, at the time it was published, a single bitcoin was worth $2,354. The release stated that the total amount seized was worth $500 million – less than one-sixth of its current value today.