Few new technologies have raised as much discussion as blockchain. One reason is the controversy, concern, and perceived opportunity around blockchain-based cryptocurrencies (such as bitcoin and ether) and crowdfunding via initial coin offerings (ICOs). But what is blockchain’s role in the enterprise?
This article gives some ideas to think about. Take those trends with grain of salt. There will be a crash ans bubble burst on blockchains in few years.
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Tomi Engdahl says:
https://www.dna.fi/yrityksille/blogi/-/blogs/nina-nissila-valtiolle-blockchain-on-uusi-tapa-ajatella-luottamusta?utm_source=facebook&utm_medium=artikkeli&utm_term=nina_nissila_valtiolle_blockchain_on_uusi_tapa_ajatella_luottamusta&utm_campaign=sisaltomarkkinointi
Tomi Engdahl says:
Crypto experts predict the regulation of the market, the clogging of the Ethereum network and the placement of Finnish companies abroad.
https://yle.fi/uutiset/3-10012902
Tomi Engdahl says:
https://yle.fi/uutiset/3-10012902
The value of the world’s cryptographic currencies is almost $ 700 billion – experts tell what the crypto service will bring
Crypto experts predict the regulation of the market, the clogging of the Ethereum network and the placement of Finnish companies abroad.
Tomi Engdahl says:
Comcast Ventures is betting on blockchain technologies in 2018
https://techcrunch.com/2018/01/10/comcast-ventures-is-betting-on-blockchain-technologies-in-2018/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
“In 2018 we’re doubling down on blockchain,” says Gil Beyda, managing director of Comcast Ventures, the investment arm of one of the world’s largest media and telecom companies.
“A lot of folks are trying to figure out how do you apply this consensus-driven immutable decentralized infrastructure and decentralized distributed applications,” Beyda says. “We have real-world applications inside Comcast where folks are trying to solve real-world problems with blockchain.”
“In 2018, we will see a growing number of enterprise blockchain use cases go mainstream from healthcare applications to government, supply chain and retail to the real estate and transportation industries.”
“Irrespective of what’s happening in cryptocurrency we think that this technology — like database technology and internet technology were transformational — this technology will also have a high area of growth and adoption,” Beyda says.
Tomi Engdahl says:
Ransomware and Bitcoin Enter New Phase
http://www.securityweek.com/ransomware-and-bitcoin-enter-new-phase
The phenomenal appreciation in Bitcoin’s value against the dollar, up roughly 18x in 2017 and 4x since September, gives us pause to consider – from a security perspective – what this might mean for ransomware in the near and distant future.
Ransomware and Bitcoin Codependency
It is not an exaggeration to say that without each other, ransomware and Bitcoin might not exist at all. I think it’s largely understood that the rise of a virtual, anonymized and easy-to-use payment system was a key factor in making ransomware the phenomenon it is today.
I believe the fundamental importance of ransomware to the development of Bitcoin is slightly less obvious to some. A back-of-the-envelope calculation based on ransomware payment estimates and data from Bitcoin.com suggests that ransomware payments accounted for as much as 20 percent of the Bitcoin “money supply” in 2016 and through the beginning of 2017y, until the recent run-up. One-fifth is a market-moving part of any currency’s float.
Tomi Engdahl says:
Researchers find that one person likely drove Bitcoin from $150 to $1,000
https://techcrunch.com/2018/01/15/researchers-finds-that-one-person-likely-drove-bitcoin-from-150-to-1000/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Researchers Neil Gandal, JT Hamrick, Tyler Moore, and Tali Oberman have written a fascinating paper on Bitcoin price manipulation. Entitled “Price Manipulation in the Bitcoin Ecosystem” and appearing in the recent issue of the Journal of Monetary Economics the paper describes to what degree the Bitcoin ecosystem is controlled by bad actors.
To many it’s been obvious that the Bitcoin markets are, at the very least, being manipulated by one or two big players.
Tomi Engdahl says:
Bitcoin, Ethereum and almost every other cryptocurrency is plunging
https://techcrunch.com/2018/01/16/bitcoin-crypto-crashed-hard-part-deux/
Look away now if you own bitcoin or other cryptocurrencies. This won’t be breaking news to you if you are invested, but today has seen the entire crypto market fall by double-digit percentages.
The price of bitcoin slumped by 15 percent to drop below $12,000 for the first time since December 4. Ethereum, meanwhile, fell by over 20 percent to hover above $1,000 and Ripple is down 33 percent to $1.23 at the time of writing.
Tomi Engdahl says:
The block chain speeds up transport
Danish transport giant Moeller Maersk and IBM set up a partnership for bunkering technology. It focuses on developing solutions that enhance and secure global commerce.
The core of the co-operation company is the open digital platform offered by the transport-related organizations as a cloud service. The platform’s idea is to facilitate the movement of merchandise over government boundaries, while at the same time adding more transparency.
The first solutions enable the various actors in the supply chain to monitor the stages of a transportation event in real time. Solutions automate document processes, saving time and costs.
Block-chain technology enables intelligent contracts to be drawn up. They help to ensure that the necessary approvals are obtained and the approval process speeds up and errors are reduced.
Source: https://www.tivi.fi/Kaikki_uutiset/lohkoketju-nopeuttaa-kuljetuksia-6697053
Tomi Engdahl says:
CRUNCH NETWORK
A modest primer for Ethereum programming
https://techcrunch.com/2018/01/15/a-modest-proposal-for-ethereum-programming/?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 drops below $10K after three days of cryptocurrency correction
https://techcrunch.com/2018/01/17/bitcoin-drops-below-10k-after-three-days-of-cryptocurrency-correction/?utm_source=tcfbpage&sr_share=facebook
The crypto crash that began two days ago accelerated yesterday and today, with essentially all top 100 coins down anywhere between 15-30 percent. The total market capitalization of all cryptocurrencies is hovering around $450 billion, down ~30 percent from $650 billion just 48 hours ago.
Tomi Engdahl says:
Where is crypto heading in 2018? We talk to some folks who might know
https://techcrunch.com/2018/01/19/where-is-crypto-heading-in-2018-we-talk-to-some-folks-who-might-know/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Tomi Engdahl says:
BLOCKCHAINS: HOW TO STEAL MILLIONS IN 2^64 OPERATIONS
https://research.kudelskisecurity.com/2018/01/16/blockchains-how-to-steal-millions-in-264-operations/
I’ve been reviewing the source code of a number of blockchain thingies, both for paid audits and for fun on my spare time, and I routinely find real security issues. In this post I’ll describe a vulnerability noticed a while ago
TL;DR: you can hijack certain Lisk accounts and steal all their balance after only 264 evaluations of the address generation function (a combination of SHA-256, SHA-512, and a scalar multiplication over Ed25519’s curve).
To simplify, Lisk is a kind of Ethereum where contracts are written in JavaScript—instead of Solidity or Viper—and where the consensus protocol relies on proof-of-stake instead of proof-of-work. More precisely, Lisk uses a delegated proof-of-stake (DPoS) protocol, wherein a limited number of nodes, chosen by user through a voting mechanism, will actually validate transactions. Having only a limited number (101) of validators speeds up transactions validation while keeping Lisk kinda decentralized.
Like in any cryptocoin platform, coin owners are identified by an address. In Lisk, addresses are 64-bit numbers, such as 3040783849904107057L. Whereas in Bitcoin, for example, an address is simply a hash of one’s public key, a Lisk address is derived deterministically from a passphrase, while generating the users’s keypair along the way.
you can find a preimage of any address in approximately 264 evaluations
And that’s the second problem: an address isn’t bound to a keypair until it has sent money to another address (or voted for a delegate). What this means is that if an account only receives money but never sends any, then it can be hijacked by finding a preimage
Tomi Engdahl says:
Sandra Upson / Wired:
How the developers of the Lightning Network plan to make Bitcoin transactions faster and cheaper using private payment channels
The Lightning Network Could Make Bitcoin Faster—and Cheaper
https://www.wired.com/story/the-lightning-network-could-make-bitcoin-faster-and-cheaper
With this extra layer of code in place, they believed, bitcoin could support far more transactions and make them almost-instant, reliable and cheap, while remaining free of banks and other institutions. In other words, it promised to fulfill the cryptocurrency dream originally set out by Satoshi Nakamoto in 2008.
As word of their paper spread, blockchain enthusiasts started hashing out its technical details in blogs and on social media. Around the world, engineers began trying to turn the ideas in Poon and Dryja’s paper into working code.
Now, almost three years after Poon and Dryja shared their idea, the Lightning Network is coming to life. Last month the isolated groups developing the network, including Russell, banded together and released a “1.0” version. It has hosted its first successful payments, with developers spending bitcoin to purchase articles on Y’alls, a micropayment blogging site built for demonstration purposes by programmer Alex Bosworth.
“When you first heard about bitcoin, you probably heard about ‘instant payments around the world for free,’” says Russell. “But if you dug into it, it wasn’t really that cheap, and it was never instant. Lightning actually does those things.”
The Crypto Conundrum
Fixing bitcoin has become an obsession among the developers, miners and investors who wish to see the cryptocurrency become the future of finance. The problem lies at the heart of its design. When a person buys or sells something using bitcoin, that transaction is broadcast to the entire bitcoin network. No matter how small or big, every payment is stored on the approximately 200,000 computers participating in the network. With bitcoin’s popularity soaring, that arrangement leaves the system straining to handle the load.
Because space in a block is limited, spenders attach a fee to incentivize miners to include their transaction before others. As the backlog of payments grows, spenders offer increasingly lofty fees to attract miners to their transactions. On Thursday, for example, the fee to process an average payment in the next block (with confirmation in roughly 10 minutes) was $14. Those fees are the same for a payment of $5 or $50,000. That’s problem #2: the fees make small transactions impractical.
Developers have proposed and debated various ways of fixing bitcoin, but few solutions have the momentum of the Lightning Network. Its core idea is that most payments need not be recorded in bitcoin’s ledger. Instead, they can take place in private channels between users. The Lightning Network’s builders seek to move the bulk of everyday payments to private channels and use the blockchain as a secure fallback, to ensure honest commerce.
In this system, two parties open a channel and commit funds to it. The opening of a channel gets broadcast to the blockchain and incurs the normal bitcoin transaction fee. The channel can stay open for however long—say, a month—during which time the two users can exchange as many payments as they like for free. When the time expires, the channel closes and broadcasts the final state of the pair’s transactions to the blockchain, incurring another transaction fee.
This arrangement works well for parties that frequently do business together
The system’s design includes extra cryptographic features that allow a user to safely send payments not only through their direct connections but across their extended networks.
Some entrepreneurs are willing to gamble on Lightning today. Last week a VPN provider called TorGuard may have become the first company to announce it will accept payments made through the Lightning Network. But it cautioned in a tweet that the network “is not production ready” and that the company would cover any lost payments. For now, Lightning’s users are hardcore bitcoin enthusiasts willing to risk some satoshi to bask in the glory of being first.
Tomi Engdahl says:
Timothy B. Lee / Ars Technica:
The rise of cryptocurrency mining has created a global shortage of high-end graphics cards from Nvidia and AMD, driving up prices for retail gamers/buyers — “Cryptocurrency can’t crash soon enough,” one gamer fumes. — The market for high-end graphics cards used to work like the market for almost any other piece of computer gear.
Here’s why you can’t buy a high-end graphics card at Best Buy
“Cryptocurrency can’t crash soon enough,” one gamer fumes.
https://arstechnica.com/tech-policy/2018/01/cryptocurrency-boom-creates-insane-global-graphics-card-shortage/
The market for high-end graphics cards used to work like the market for almost any other piece of computer gear. You’d go to your local electronics store, pick one up off the shelf, and pay an amount right around the manufacturer’s suggested retail price.
But the rise of cryptocurrency mining has created an unprecedented global shortage of graphics cards. If you go to your local retailer, you’re likely to find bare shelves where the beefier cards used to be. Instead of trading at a discount, used cards routinely sell for well above MSRP on sites like eBay and Craigslist.
And it’s driving PC gamers—who used to be the primary market for these cards—crazy.
“Cryptocurrency can’t crash soon enough,” one gamer wrote on the PCGaming subreddit a few days ago. Gamers thinking about building a new gaming machine are being forced to put those plans on hold until the market settles down. Others, who bought high-end graphics cards a few months ago, are wondering if they should sell at a big profit.
Jared Walton of PC Gamer sums up the situation: “It’s a terrible time to buy a graphics card.”
The graphics card shortage is happening because high-end graphics cards are the best way to mine Ethereum and other non-bitcoin cryptocurrencies.
I asked a sales representative to check to see if I could get an RX 580 at another Best Buy store. No luck.
“It’s not available in any store,” she told me. “It’s not online.”
According to data from PC Part Picker, you could get an AMD Radeon RX 570 for around $200 last spring, while an average RX 580 cost closer to $250.
RX 580 cards now cost more than $400 on average.
The cryptocurrency boom is creating big profit opportunities
So who’s driving all this demand for graphics cards? Cryptocurrency miners.
Bitcoin mining is no longer profitable on consumer graphics cards because people have built sophisticated custom ASIC-based mining equipment that’s far more power-efficient. But Ethereum has a memory-hungry mining algorithm that’s resistant to ASIC optimization. That means mining Ethereum is still practical with a consumer graphics card if it has more than two gigabytes of memory. Entry-level graphics cards don’t have enough memory, but more advanced ones do.
Most of the people we talked to began mining in the summer of 2017—right around the time graphics card prices started to creep upward.
Mining is a global phenomenon
Blockchain networks are global, so people are unsurprisingly having similar experiences around the world. Suleiman Alaquel, a software developer from Riyadh, emailed us about his experiences mining cryptocurrency in Saudi Arabia. The kingdom is an attractive place to mine cryptocurrencies because electricity there is cheap. But graphics cards are expensive.
“I went to a store that’s well known for PC gamers’ tech,” Alaquel told us by email. “As soon as I asked for a high-end GPU he said ‘you’re also one of them miners!’ He told me that everything is sold out because of miners!”
A few miners had pre-ordered all of the high-end graphics card shipments the store expected for the next six months, Alaquel said.
much hardware is manufactured in Asia.
“Pretty much any computer store will build you a mining rig,” Hadrell wrote by email. “You choose the card, choose the number of cards, and select where you want them shipped to.”
One big difference from the US or Saudi Arabia, he said, is that electric utilities don’t allow mining in residential buildings—so miners generally have their rigs shipped directly to commercial hosting facilities.
Tomi Engdahl says:
The Goatse Cryptocurrency Is Launching to Make Memes Danker
And it’s starting with an ICO.
https://motherboard.vice.com/en_us/article/ne78vd/goatse-cryptocurrency-launch-dank-memes-ethereum-token-ico
When news broke in August that the Goatse website—which once hosted a gross-out meme that scarred many in the early days of the web—was launching its own cryptocurrency, the response was general confusion. Why did the site that used to host an image of a man holding his butthole wide open need its own digital currency? Was it… real?
Dear reader, it appears to be real.
Tomi Engdahl says:
Bitcoin’s fluctuations are too much for even ransomware cybercriminals
https://www.theguardian.com/technology/2018/jan/18/bitcoin-fluctuations-ransomware-cybercrminals-malware-developers
Malware developers have had to demand ransoms in local currencies as they attempt to not price their targets out
Bitcoin’s price swings are so huge that even ransomware developers are dialling back their reliance on the currency, according to researchers at cybersecurity firm Proofpoint.
Over the last quarter of 2017, researchers saw a fall of 73% in payment demands denominated in bitcoin. When demanding money to unlock a victim’s data, cybercriminals are now more likely to simply ask for a figure in US dollars, or a local currency, than specify a sum of bitcoin.
Just like conventional salespeople, ransomware developers pay careful attention to the prices they charge. Some criminals offer discounts depending on the region the victim is in, offering cheaper unlocking to residents of developing nations, while others use an escalating price to encourage users to pay quickly and without overthinking things.
But a rapidly oscillating bitcoin price plays havoc with those goals, Proofpoint says. “Surging cryptocurrency values are a boon for holders of bitcoin. But they are a challenge for anyone who tries to price their product or service in bitcoin — threat actors included. In Q4, newer ransomware strains appeared to take this into account. Sigma ransomware first appeared in mid-November demanding a payment denominated in US dollars.”
Tomi Engdahl says:
Nordea bank workers are forbidden to use Bitcoins in the near future:
Nordea forbyder bitcoin-handel for alle 31.000 ansatte
http://finans.borsen.dk/artikel/1/357309/nordea_indfoerer_bitcoin-forbud_for_alle_31000_ansatte.html?utm_source=forside&utm_campaign=nyhed_01
Tomi Engdahl says:
Diversifying the blockchain
https://techcrunch.com/2018/01/21/diversifying-the-blockchain-maiden/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
It’s common knowledge that the tech and financial industries are not diverse and inclusive places. So when you combine the two and out comes blockchain, what you get from a diversity viewpoint isn’t pretty.
“The consensus is that because blockchain is so niche and it’s mostly early adopters who come from tech and finance, that it’s actually less diverse than those industries that are already struggling to be representative of the population at large,” Raine Revere, co-founder of blockchain education startup Maiden, told
In purposefully simplistic terms, blockchain is a technology that allows two untrustworthy peers to make a verifiable transaction without intermediaries. The technology wipes out the need for an intermediary, such as a government, a bank or a company. Using cryptography, people can make these peer-to-peer transactions with less risk of their data being compromised. And in a “well-designed peer to peer system,” Revere said, there are reduced costs for the end user as a result of not paying intermediaries to keep your data safe and coordinate all of the transactions
Tomi Engdahl says:
BuzzFeed:
How scammers are getting rich using social media, scam news sites, and private pump and dump group chats to spread false information about cryptocurrencies — In the largely unregulated world of bitcoin and cryptocurrency, fraudsters are getting rich by deliberately spreading false information …
Here’s How Scammers Are Using Fake News To Screw With Bitcoin Investors
https://www.buzzfeed.com/ryanmac/heres-how-scammers-are-using-fake-news-to-screw-with-bitcoin?utm_term=.ua9kE2Rvv#.kvLBwoN00
In the largely unregulated world of bitcoin and cryptocurrency, fraudsters are getting rich by deliberately spreading false information to affect the price of their holdings using social media, scam news sites, and private chat apps.
Tomi Engdahl says:
Anna Irrera / Reuters:
Study of 372+ ICOs shows that ~$400M of the total $3.7B funds raised to date have been stolen, with phishing as the most widely used hacking technique — NEW YORK (Reuters) – More than 10 percent of funds raised through “initial coin offerings” are lost or stolen in hacker attacks …
More than 10 percent of $3.7 billion raised in ICOs has been stolen: Ernst & Young
https://www.reuters.com/article/us-ico-ernst-young/more-than-10-percent-of-3-7-billion-raised-in-icos-has-been-stolen-ernst-young-idUSKBN1FB1MZ
More than 10 percent of funds raised through “initial coin offerings” are lost or stolen in hacker attacks, according to new research by Ernst & Young that delves into the risks of investing in cryptocurrency projects online.
Tomi Engdahl says:
Stripe is ending support for bitcoin payments on April 23
https://techcrunch.com/2018/01/23/stripe-is-ending-support-for-bitcoin-payments-on-april-23/?utm_source=tcfbpage&sr_share=facebook
Payments platform Stripe will stop supporting bitcoin in April, citing the cryptocurrency’s volatility and long transaction times, among other things. It’s a logical decision, but one likely to anger the easily provoked crypto-crowd.
Tomi Engdahl says:
The Top 8 Cryptocurrencies to Watch (and Invest) in 2018
https://finance.toolbox.com/blogs/craigborysowich/the-top-8-cryptocurrencies-to-watch-and-invest-in-2018-122217
BTC is the granddaddy and will likely continue to rise over 2018 to some new heights as the derivatives/futures markets eventually grow up into ETFs – also watch for other CCs that start to get rolled into these markets – BTC is only the first – ETH and LTC will be fast followers along with others. But, they need to avoid any further hard forks and the whole bitfinex/tether thing can’t turn into a giant smoking crater. Obviously, the exchange operations fees was a big miss in the overall design of bitcoin and all of the similar cryptocurrencies. The exchanges are marking up large fees of $20+ per transaction to justify their existence and this is crippling BTC as a microtransaction engine. Thus the reason that Steam has dropped BTC support for their commerce.
Here are some of the highlights
‘wait and see’ list is Neo (NEO) – this is known as the Ethereum of China.
Monero (XMR) is another interesting CC variant that is pushing a truly anonymous usage and transactional ledger.
Cardano (ADA) has gotten a ton of VC backing to create a major competitor to Ethereum, and 2018 might just prove that they can pull it off.
Stellar Lumens (XLM)
Iota (IOT) like its name, this CC has a lot of potential to be the machine to machine transaction processor in the Internet Of Things world. The node and miner are built into a single engine. In order to have your transaction submitted, you need to validate two other transactions on the network. We had pegged a use case in the energy sector that would link smart meters on clean energy producers (wind/solar) and smart meters on clean energy consumers (i.e. Bullfrog power customers) to generate an auditable ledger of contributors and consumers on the grid using IOTA. They are currently trading @ ~$5USD and likely to pick up steam in 2018
DASH coin (DASH) continues to be a force with their two-tier structure of miners and masternodes that continues to outperform many networks for transactional performance.
Naga Coin (NGC) – this token is in ICO status with a pre-sale completed.
OmiseGo (OMG) – based on Ethereum this CC is ERC20 compliant and will work with supporting wallets for this standard. Their focus is on P2P transfers of fiat currencies and CC in real time.
Tomi Engdahl says:
Josh Constine / TechCrunch:
Zero-fee stock trading app Robinhood says it will let users trade bitcoin and ether starting in February using its Robinhood Crypto platform — No-commission stock trading app Robinhood will let you buy and sell Bitcoin and Ethereum without any added transaction fees starting in February …
Robinhood adds zero-fee cryptocurrency trading and tracking
https://techcrunch.com/2018/01/25/free-cryptocurrency-trading-app/
No-commission stock trading app Robinhood will let you buy and sell Bitcoin and Ethereum without any added transaction fees starting in February, compared to Coinbase’s 1.5 to 4 percent fees in the US. And as of today Robinhood will let all users track the price, news, and set up alerts on those and 14 other top crypto coins, including Litecoin and Ripple.
“We’re planning to operate this business on a break-even basis and we don’t plan to profit from it for the foreseeable future” says Robinhood co-founder Vlad Tenev. “The value of Robinhood Crypto is in growing our customer base and better serving our existing customers.”
Tomi Engdahl says:
How a PhD Student Unlocked 1 Bitcoin Hidden In DNA
https://news.slashdot.org/story/18/01/24/2228229/how-a-phd-student-unlocked-1-bitcoin-hidden-in-dna
A 26-year-old Belgian PhD student named Sander Wuytz recently solved a 3-year-old puzzle that had locked the private key to 1 Bitcoin in a strand of synthetic DNA. Motherboard spoke with the student about how they managed to crack the puzzle, just days before it was set to expire.
A Piece of DNA Contained the Key to 1 Bitcoin and This Guy Cracked the Code
https://motherboard.vice.com/en_us/article/7xe3dx/dna-storage-bitcoin-mystery-puzzle
Just five days before a three-year old Bitcoin puzzle was set to expire, a PhD student cracked the code.
A three-year old Bitcoin mystery came to an end last week after Sander Wuyts, a 26-year old Belgian PhD student at the University of Antwerp, cracked a code that revealed the key to one bitcoin inside a strand of synthetic DNA.
The key—chemicals arranged to represent a string of text—was placed in the DNA as part of the DNA Storage Bitcoin Challenge. The challenge began in 2015 after Nick Goldman, a researcher at the European Bioinformatics Institute, gave a presentation on using DNA to store information at the World Economic Forum’s annual meeting in Davos, Switzerland. During this presentation, Goldman distributed tubes of DNA in which he had encoded the key to a digital wallet containing one bitcoin.
The first person to sequence the DNA and decode the files would be able to claim the bitcoin, which was worth about $200 at the time. Now, that same bitcoin is worth over $10,000.
Tomi Engdahl says:
Due diligence for Cryptospace
Due Diligence Clues
https://www.halfpasthuman.com/#timetalks
These linguistic clues can be used in your due diligence work before investing in any crypto offering.
If the language of the offering is touting a ‘technological innovation’, beware, such are fleeting the world of software, being easily replicated.
When you read that an offering is going to make smart contracts usable, or easy, or accessible, are they speaking of running an education program?
Legally enforceable smart contracts are yet more buzz words to avoid. Legal does not enter into the picture with software contracts. The software executes the contract, or it fails. Pretty binary, and not much to give to lawyers to argue about after the failure. It is simply not within the power of the legal system to force software to perform.
Any ICO that has ‘storage’ within its claim to fame, as in the idea of storing anything, data, pictures, fingerprints, et al, is to be avoided. Such language indicates either they don’t have anyone with experience programming for blockchain networks, or their PR people are totally disconnected from the reality
Another idea that keeps coming up is the ‘decentralized search engine’ as competition to Google. Avoid these
Yet another bad crypto idea is the decentralized, or blockchain enabled, advertising exchange.
Yet more caution words include ‘micro-payments’. Any micro-payments system that is blockchain based will also be, by its nature, incredibly computation focused, and this is as bad (expensive) on the blockchain as is storage. Not going to end well. As the popularity of a micro-payments based blockchain driven system increases, so will its costs, even more so, until, in the real world, it will cost more in processing fees, than the payment itself.
Popular fancy takes the blockchain into areas where it should not be going. One of these is the idea of a work exchange or job matching system.
More bad words for crypto offerings include ‘community control’, or any words where the ‘community’ will be ‘voting’ on any aspect of the management of the item under offer. These are, by definition, not businesses, but are social engineering attempts.
Associated with the ‘community control type’ of cryptocurrencies, are the dreaded ‘social doctor coins’. These ICOs will be touting the blockchain as a ‘solution’ to some form of perceived social problem.
The final set of bad words for cryptocurrencies include ‘distributed computing’. Running distributed computing is a nightmare, even when all aspects are tightly centralized.
Tomi Engdahl says:
More startup lawyers are accepting cryptocurrencies as payment
https://techcrunch.com/2018/01/26/report-more-startup-lawyers-are-accepting-cryptocurrencies-as-payment/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
A growing number of law firms working with startups are beginning to accept their payment in cryptocurrencies, according to a new report by the trade-focused outlet Law.com.
The lawyers suggest that they increasingly have no choice. In order to land the growing number of businesses launched by cryptocurrency entrepreneurs, they have to show that they’re invested in what their clients are building. Often, too, the founders’ wealth has been accumulated in bitcoin, which makes it unavoidable.
It’s an interesting shift, and one that’s very reminiscent of service providers who were paid in equity during the go-go dot.com days of the late ’90s — a move that paid off hugely for some and far less profitably for others.
Lawyers Getting Paid in Bitcoin (Mostly) Like It
https://www.law.com/sites/legaltechnews/2018/01/25/lawyers-getting-paid-in-bitcoin-mostly-like-it/?slreturn=20180027040841
Although it might go against a lawyer’s natural propensities toward risk aversion, some practitioners have started accepting payments in digital currencies amid the bitcoin boom.
Tomi Engdahl says:
https://www.tivi.fi/Kaikki_uutiset/lohkoketjutekniikka-mullistaa-nyt-sahkoverkot-6698535
Tomi Engdahl says:
James Vincent / The Verge:
AI advances are now making automated analysis of live surveillance video possible, presaging useful applications while raising serious questions about privacy
Artificial intelligence is going to supercharge surveillance
What happens when digital eyes get the brains to match?
https://www.theverge.com/2018/1/23/16907238/artificial-intelligence-surveillance-cameras-security
We usually think of surveillance cameras as digital eyes, watching over us or watching out for us, depending on your view. But really, they’re more like portholes: useful only when someone is looking through them. Sometimes that means a human watching live footage, usually from multiple video feeds. Most surveillance cameras are passive, however. They’re there as a deterrence, or to provide evidence if something goes wrong. Your car got stolen? Check the CCTV.
But this is changing — and fast. Artificial intelligence is giving surveillance cameras digital brains to match their eyes, letting them analyze live video with no humans necessary. This could be good news for public safety, helping police and first responders more easily spot crimes and accidents and have a range of scientific and industrial applications. But it also raises serious questions about the future of privacy and poses novel risks to social justice.
What happens when governments can track huge numbers of people using CCTV? When police can digitally tail you around a city just by uploading your mugshot into a database? Or when a biased algorithm is running on the cameras in your local mall, pinging the cops because it doesn’t like the look of a particular group of teens?
AI surveillance starts with searchable video
Tomi Engdahl says:
Yuji Nakamura / Bloomberg:
Japanese cryptocurrency exchange Coincheck says that 500M NEM cryptocurrency tokens, worth ~$400M, have been “illicitly” transferred out of the exchange — Coincheck Inc., one of Japan’s biggest digital exchanges, said that about $400 million of the NEM cryptocurrency was lost after it was sent …
Coincheck Says It Lost Crypto Coins Valued at About $400 Million
https://www.bloomberg.com/news/articles/2018-01-26/cryptocurrencies-drop-after-japanese-exchange-halts-withdrawals
Tomi Engdahl says:
Theodore Schleifer / Recode:
Sources: VCs with long Bitcoin experience like a16z, USV, are passing on Telegram’s ICO; VCs newer to cryptocurrencies like KPCB, Sequoia, Benchmark, investing — The investors are not who you’d expect. — Some of the most prominent investors in cryptocurrency are passing …
Telegram’s ICO is attracting the industry’s newer crypto investors while firms like Andreessen Horowitz sit this one out
The investors are not who you’d expect.
https://www.recode.net/2018/1/26/16937942/telegram-ico-cryptocurrency-venture-capital
Tomi Engdahl says:
Brady Dale / CoinDesk:
Mobius, which is building a Stripe-like payments platform for cryptocurrencies, raises $39M in its ICO, uses Stellar blockchain instead of Ethereum
Why a $39 Million ICO Chose Stellar Over Ethereum
https://www.coindesk.com/why-a-39-million-ico-chose-stellar-over-ethereum/
“We look at ethereum like AOL or Myspace.”
That’s how Mobius Network co-founder and CEO David Gobaud explains why his startup ran its initial coin offering (ICO) on the Stellar network instead of ethereum, the most popular blockchain for token sales.
The comment underscores the growing interest in some corners of the crypto community for faster and cheaper payment rails as ethereum, like bitcoin, struggles to scale.
Mobius announced Thursday that it has raised $39 million in the ICO — one of the larger recent token sales and the largest by far on the Stellar platform. The company accepted only Stellar’s native currency, lumens (XLM), in exchange for its own token, known as mobi.
According to Mobius, the sale hit its $39 million hard cap after only two hours, selling 35 percent of the total 888 million mobi tokens.
Tomi Engdahl says:
Jeff John Roberts / Fortune:
Coinbase partners with Trading Technologies, a trading software provider, enabling financial institutions to trade on Coinbase’s GDAX cryptocurrency exchange
Coinbase Expands Trading Options for Large Investors
http://fortune.com/2018/01/25/coinbase-gdax-futures-cryptocurrency/
The crypto-currency exchange Coinbase on Thursday announced a new tie-up between its institutional platform, GDAX, and Trading Technologies (TT), which provides trading software for the likes of hedge funds and firms like Goldman Sachs and JP Morgan.
The addition of the TT tools will make it easier for traders to engage in spot market and futures trades at the same time. This is significant, according to GDAX, because such tools are a foundation of sophisticated trading strategies, and could entice more major financial players to enter the crypto markets.
The tie-up between GDAX and TT comes after a group of exchanges began offering futures contracts for bitcoin and other crypto-currencies in December. The availability of these contracts was expected to help temper the extreme volatility that has long characterized the crypto markets but, so far, they have done little to temper the price swings.
Meanwhile, the Wall Street Journal of Wednesday reported that hedge funds are growing wary of “cryptomania” amid an ongoing slump in prices.
Tomi Engdahl says:
Yuji Nakamura / Bloomberg:
Japanese cryptocurrency exchange Coincheck says it will repay all 260K users who lost money in Friday’s theft of ~$400M in NEM coins
https://www.bloomberg.com/news/articles/2018-01-27/coincheck-to-repay-customers-who-lost-money-in-400-million-hack
The announcement came less than 48 hours after the hack was discovered on Friday.
Tomi Engdahl says:
Dan Goodin / Ars Technica:
YouTube served ads containing Coinhive’s cryptocurrency-mining, CPU-draining JavaScript, likely via Google’s DoubleClick ad server; Google says ads now blocked — Ad campaign lets attackers profit while unwitting users watch videos. — YouTube was recently caught displaying ads …
Now even YouTube serves ads with CPU-draining cryptocurrency miners
Ad campaign lets attackers profit while unwitting users watch videos.
https://arstechnica.com/information-technology/2018/01/now-even-youtube-serves-ads-with-cpu-draining-cryptocurrency-miners/
YouTube was recently caught displaying ads that covertly leach off visitors’ CPUs and electricity to generate digital currency on behalf of anonymous attackers, it was widely reported.
Word of the abusive ads started no later than Tuesday, as people took to social media sites to complain their antivirus programs were detecting cryptocurrency mining code when they visited YouTube. The warnings came even when people changed the browser they were using, and the warnings seemed to be limited to times when users were on YouTube.
On Friday, researchers with antivirus provider Trend Micro said the ads helped drive a more than three-fold spike in Web miner detections. They said the attackers behind the ads were abusing Google’s DoubleClick ad platform to display them to YouTube visitors in select countries, including Japan, France, Taiwan, Italy, and Spain.
The ads contain JavaScript that mines the digital coin known as Monero. In nine out of 10 cases, the ads will use publicly available JavaScript provided by Coinhive, a cryptocurrency-mining service that’s controversial because it allows subscribers to profit by surreptitiously using other people’s computers. The remaining 10 percent of the time, the YouTube ads use private mining JavaScript that saves the attackers the 30 percent cut Coinhive takes. Both scripts are programmed to consume 80 percent of a visitor’s CPU, leaving just barely enough resources for it to function.
“YouTube was likely targeted because users are typically on the site for an extended period of time,”
To add insult to injury, the malicious JavaScript in at least some cases was accompanied by graphics that displayed ads for fake AV programs, which scam people out of money and often install malware when they are run.
As the problem of Web-based cryptomining has surged to almost epidemic proportions, a variety of AV programs have started warning of cryptocurrency-mining scripts hosted on websites and giving users the option of blocking the activity.
Tomi Engdahl says:
Blockchains for selling and buying electricity
https://www.tivi.fi/Kaikki_uutiset/lohkoketjutekniikka-mullistaa-nyt-sahkoverkot-6698535
Tomi Engdahl says:
Hacked Tokyo cryptocurrency exchange to repay owners $425 million
https://www.reuters.com/article/us-japan-cryptocurrency/hacked-tokyo-cryptocurrency-exchange-to-repay-owners-425-million-idUSKBN1FH03D
World leaders meeting in Davos last week issued fresh warnings about the dangers of cryptocurrencies, with U.S. Treasury Secretary Steven Mnuchin relating Washington’s concern about the money being used for illicit activity.
Tomi Engdahl says:
Cryptocurrencies Fall After Hack Hits Japan’s Coincheck
http://www.securityweek.com/cryptocurrencies-fall-after-hack-hits-japans-coincheck
Cryptocurrencies fell Friday after Japan-based digital exchange Coincheck suspended client deposits and withdrawals for virtual currencies except bitcoin, saying it had been hacked.
Coincheck said it was investigating “unauthorised access” of the exchange that appeared to result in a loss worth half a billion US dollars of NEM, the 10th biggest cryptocurrency by market capitalisation.
“At 3 am (1800 GMT) today, 523 million NEMs were sent from the NEM address of Coincheck. It’s worth 58 billion yen based on the calculation at the the rate when detected,” said Coincheck’s chief operating officer Yusuke Otsuka late Friday.
According to its website, which proclaims it is “the leading bitcoin and cryptocurrency exchange in Asia”, Tokyo-based Coincheck was founded in 2012 and had 71 employees as of July last year.
In 2014 major Tokyo-based bitcoin exchange MtGox collapsed after admitting that 850,000 coins — worth around $480 million at the time — had disappeared from its vaults.
Tomi Engdahl says:
Hyperledger releases Hyperledger Sawtooth 1.0, its second distributed ledger project
https://techcrunch.com/2018/01/30/hyperledger-releases-new-open-source-distributed-ledger-called-hyperledger-sawtooth/?utm_source=tcfbpage&sr_share=facebook
Hyperledger, the open source blockchain project from the Linux Foundation, released Hyperledger Sawtooth 1.0, its latest open source digital ledger project. Sawtooth joins its sister project, Hyperledger Fabric which reached 1.0 in July last year.
Tomi Engdahl says:
https://www.yrittajat.fi/uutiset/569520-nama-asiat-hyva-tietaa-kryptovaluutasta-rikollista-vai-ei?utm_campaign=58c7d65973a6a367cd06e007&utm_content=5a705bf394a32615000229c5&utm_medium=smarpshare&utm_source=facebook
Tomi Engdahl says:
Facebook is banning all ads promoting cryptocurrencies — including bitcoin and ICOs
https://www.recode.net/2018/1/30/16950926/facebook-mark-zuckerberg-bans-crypto-advertising-bitcoin-james-altucher
It’s an “intentionally broad” policy aimed at stopping scammers.
Facebook is banning all ads that promote cryptocurrencies, including bitcoin, in an effort to prevent people from advertising what the company is calling “financial products and services frequently associated with misleading or deceptive promotional practices.”
The cryptocurrency boom/bubble has led to scams and wild price fluctuations that have cost a lot of people — including unsophisticated investors — a lot of money. Scams are illegal, but gambling on investments you don’t understand is not.
Tomi Engdahl says:
Cryptocurrency Scams Are Just Straight-Up Trolling at This Point
https://www.wired.com/story/cryptocurrency-scams-ico-trolling
Facebook announced in a blog post Tuesday that it would ban cryptocurrency advertising from the platform entirely. The company said that many ads for cryptocurrency investment opportunities, like initial coin offerings, were “not currently operating in good faith.” Facebook has a point
‘It’s easier to dupe someone into investing in your ICO in 2018 than your fake real estate business.’
Not every ICO is a scam, and many cryptocurrency startups are legitimate. But the shady, largely unregulated cryptocurrency investment landscape is littered with dozens of fraudulent ventures. (They’re also susceptible to hackers; more than 10 percent of the $3.7 billion raised through ICOs has been lost or stolen, according to a recent analysis from the accounting firm Ernst & Young.)
Easy Money
The cryptocurrency market is ripe for scammers because it’s relatively new, backed by tons of hype, and involves complicated technology. It’s easier to dupe someone into investing in your ICO in 2018 than your fake real estate business—and plenty of people have. A cryptocurrency startup only needs a swanky website and an official-looking white paper. There are also plenty of services to help streamline the process: You can automate your token sale, or have someone write fake news articles hyping up your venture.
Confusion around blockchain technology also makes much of the public a potentially easy mark. Blockchains are encrypted, distributed ledgers that operate without a central authority like a bank. The ledger itself is securely stored on many computers, so it can’t be altered or hacked. The Ethereum blockchain—on which Prodeum relied—allows for more complicated applications to be built on top of it. Eth-Tweet, for example, is a decentralized microblogging service built on the Ethereum blockchain.
Here’s where the ICO comes in. An initial coin offering allows you to buy some of the tokens that power a specific application.
To complicate matters further, blockchain startup founders frequently tell investors that they’re not putting their money in something akin to a traditional security, but actually into the technology itself. (It’s often unclear what that means in practice.)
Detecting Fool’s Gold
The exact terms of an ICO are usually laid out in an accompanying white paper, which is often the only documentation that investors have to decipher whether a new startup is a solid opportunity. Plenty of ICOs raise millions of dollars in cryptocurrency without even having a working prototype of their software. Even when a demonstration is available, only savvy investors can really evaluate whether an application will be feasible. Many startups don’t even write their white papers themselves: The task is outsourced to services that write the papers for them.
‘Fraudulent ICOs can be used to repackage old frauds in a new wrapper.’
Ultimately, blockchain scams aren’t much different from other types of investment fraud. Whether you dress it up as an ICO or a hedge fund, the grift generally works the same: Convince unassuming individuals that you can make them rich, then steal their money. While the SEC has yet to aggressively go after much of the cryptocurrency market, it does regularly file complaints against hundreds of other scams designed to rip people off. Humans have been trying to swindle each other out of money for thousands of years. The cryptocurrency is just the latest opportunity to do so.
“Fraudulent scams like Ponzi schemes and sponsors who pocket investor’s money have been around for a long time. Fraudulent ICOs can be used to repackage old frauds in a new wrapper,”
Tomi Engdahl says:
Why Tether’s Collapse Would Be Bad for Cryptocurrencies
https://www.wired.com/story/why-tethers-collapse-would-be-bad-for-cryptocurrencies
The cryptocurrency world, with its volatility, is all about FUD—fear, uncertainty, doubt. And nothing is generating more FUD right now than an unusual currency called tether.
Unlike bitcoin and its many siblings, tether is what is called a stablecoin, an entity designed to not fluctuate in value. With most cryptocurrencies prone to wild swings, tether offers people who dabble in the market the option of buying a currency that its backers say is pegged to the US dollar. Trading bitcoin for dollars at a bank can be cumbersome and costly; by comparison, acquiring tether is simple, cheap and fast.
But in recent weeks a chorus of skeptics has called into question nearly everything about tether. The root of the controversy is whether the company behind it, also called Tether, is telling the truth when it claims that every unit in circulation is matched by a US dollar it holds in reserve. If the company has a dollar for every tether, that means in theory any holder can sell tethers back to the company for an equal number of dollars at any time. This belief keeps the value of a tether pegged to a dollar.
Critics on Twitter, Reddit, in blog posts, and at a recent bitcoin conference have been demanding that the company prove its reserves through external audits. Not only has Tether failed to do so, last week it confirmed rumors that it had severed ties with Friedman LLP, the accounting firm on tap to perform those audits.
If tethers are not backed by a matching number of dollars, then Tether can print an arbitrary amount of money. (Other cryptocurrencies, by contrast, create new tokens according to strictly prescribed, predictable rules.) Other problems ensue, including suspicions that Tether is timing the release of new tethers to coincide with drops in the price of bitcoin and then using those tethers to scoop up bitcoins.
If traders lose faith in tether, they could end up triggering the crypto version of a bank run. Tether helps stabilize cryptocurrency exchanges in various ways, so its collapse could also cause some exchanges to topple, wiping out billions of dollars of investments overnight and potentially undoing much of the public’s growing interest in new technologies like bitcoin.
“It’s possible that a nontrivial rise in the price of bitcoin and other cryptocurrencies has come from this asset being printed possibly out of thin air, and that is very concerning,” says Jill Carlson.
Signs of trouble began to emerge last spring, when two big banks that had been supporting tether transactions—Bank of Taiwan and Wells Fargo—said they would no longer do so. The banks also said they would no longer deal with Bitfinex
In lieu of an audit, Tether released a document in September purporting to substantiate its reserves, but with the names of its banking partners blacked out.
The rapid creation of new tethers has fueled questions about the company’s motives.
If Tether has sufficient dollar reserves (and euro holdings for its smaller euro-pegged currency), these observations don’t necessarily spell big trouble.
Tether’s resilience amid these troubles underscores the important roles it plays within the cryptocurrency trading ecosystem. Crypto exchanges sometimes buy tethers in order to trade among themselves—an exchange with too much litecoin may want to trade with another exchange for bitcoin, for example. Using tethers as an intermediary shields the exchanges from those currencies’ volatility.
Tether still trades close to $1. But if traders lose confidence in it and its value starts to drop, “people will run for the door,”
Another concern is that Bitfinex might simply shut down, pocketing the bitcoins it has allegedly been stockpiling.
Tomi Engdahl says:
Facebook Is Banning Cryptocurrency, ICO Ads
https://tech.slashdot.org/story/18/01/30/2011226/facebook-is-banning-cryptocurrency-ico-ads
Facebbook has a new advertising policy pertaining to cryptocurrency, binary options and initial coin offerings. The policy specifically prohibits ads that promote those types of products and services “that are frequently associated with misleading or deceptive practices,”
Cryptocurrencies like Bitcoin, Litecoin and Ethereum, and initial coin offerings have all hit the mainstream, which has promptly resulted in a number of scams.
Tomi Engdahl says:
Kurt Wagner / Recode:
Facebook says it’s banning all ads for cryptocurrencies, ICOs, and binary options to avoid “misleading or deceptive promotional practices” — It’s an “intentionally broad” policy aimed at stopping scammers. — Facebook is banning all ads that promote cryptocurrencies …
Facebook is banning all ads promoting cryptocurrencies — including bitcoin and ICOs
It’s an “intentionally broad” policy aimed at stopping scammers.
https://www.recode.net/2018/1/30/16950926/facebook-mark-zuckerberg-bans-crypto-advertising-bitcoin-james-altucher
Tomi Engdahl says:
Brian Fung / Washington Post:
A KodakCoin co-creator says market reaction has diverted public attention from how it benefits photography rights, first KodakCoins to be sold Wednesday in ICO
Kodak’s cryptocurrency announcement sent its stock soaring. Now a KodakCoin co-creator says it was a ‘terrible distraction.’
https://www.washingtonpost.com/news/the-switch/wp/2018/01/30/i-really-wish-it-didnt-happen-kodakcoins-co-creator-says-the-stock-surge-has-been-a-terrible-distraction/
When Kodak announced on Jan. 9 that it was planning to launch its own cryptocurrency, investors swooned. By the end of the next day, Kodak’s share price had nearly quadrupled in the midst of a broader cryptocurrency frenzy that’s gripped the public since the middle of last year.
Now, one of KodakCoin’s co-creators says he wishes that the Kodak stock surge had never occurred. “It . . . caught everybody by surprise, internally,” said Cameron Chell, the entrepreneur and lead consultant on the KodakCoin project. “It’s been a terrible distraction, and I really wish it didn’t happen.”
The market reaction, Chell said, has diverted public attention from how the cryptocurrency works and what it has to offer those who adopt it.
Kodak is one of several companies that have leaped into the cryptocurrency space in recent months. In Russia, Burger King announced a customer loyalty program that allows diners to collect tokens that they can trade or spend for free meals. The beverage company Long Island Iced Tea changed its name to Long Blockchain — a reference to the technology that drives cryptocurrencies — and said that cryptocurrencies would become its primary business. And IBM and Maersk have announced a joint venture using blockchain to streamline the global shipping industry and track the flow of goods as they move across borders.
Some of these experiments have attracted scorn. Citing the lack of a clear business plan, critics say projects such as Long Blockchain’s amount to an opportunistic attempt to pump up stock prices.
“They’re trying to capture the hype and mania surrounding blockchain right now and looking for quick paydays,”
For example, analysts have acknowledged that KodakCoin’s accompanying platform, KodakOne, could prove transformative for photography rights. Professional photographers frequently see their work published without payment or permission online, and chasing after that money can be expensive and legally burdensome. But, Kodak has said, the blockchain — a kind of digital public database whose entries can never be faked or forged — could provide a solution that forever links images with their rightful owners. (To participate, photographers would need to provide proof that they created the images they submit.)
The KodakOne digital platform, Kodak says, will make it easier for photographers to sell their work and keep an eye on who has licensed their photos and how.
“Having a clear chain of custody of digital rights to an image that includes who took it, who bought it and with which rights, etc., has been a longstanding problem for professional photographers,”
Kodak and its partner in the venture, WENN Digital, have said the platform will tie those image records with artificial intelligence software that can recognize those same images elsewhere on the Web. The idea is to identify those who have used the registered images online without authorization.
Sixty percent of the royalty payments to the KodakOne system for a particular image will go to the photographer, who can choose to be paid in traditional fiat money, such as U.S. dollars, or in the proprietary KodakCoin. Thirty percent of the payments will go to WENN Digital, and up to 10 percent may be distributed as dividends to anyone who holds KodakCoin, said Chell — an incentive to get people to adopt the platform.
The first KodakCoins will be auctioned off Wednesday in an initial coin offering, Chell said. But only accredited investors may participate,
Tomi Engdahl says:
Matthew Leising / Bloomberg:
Source: US regulators subpoenaed Bitfinex and subsidiary Tether amid doubts that Tether’s USDT, which the firm says is pegged to USD, has sufficient reserves — Firms say they routinely get ‘legal process’ from regulators — Tether has yet to verify that it holds $2.3 billion in reserve
U.S. Regulators Subpoena Crypto Exchange Bitfinex, Tether
https://www.bloomberg.com/news/articles/2018-01-30/crypto-exchange-bitfinex-tether-said-to-get-subpoenaed-by-cftc
Firms say they routinely get ‘legal process’ from regulators
Tether has yet to verify that it holds $2.3 billion in reserve
The U.S. Commodity Futures Trading Commission sent subpoenas on Dec. 6 to virtual-currency venue Bitfinex and Tether, a company that issues a widely traded coin and claims it’s pegged to the dollar, according to a person familiar with the matter
Tether’s coins have become a popular substitute for dollars on cryptocurrency exchanges worldwide, with about $2.3 billion of the tokens outstanding as of Tuesday. While Tether has said all of its coins are backed by U.S. dollars held in reserve, the company has yet to provide conclusive evidence of its holdings to the public or have its accounts audited. Skeptics have questioned whether the money is really there.
Tether and Bitfinex don’t disclose on their websites or in public documents where they’re located or who’s in charge
While little public information exists about how tethers are created, market pricing suggests traders believe that each coin is worth $1. Trading the token for Bitcoin at Bitfinex has helped drive up Bitcoin prices
A document on Tether’s website, compiled by accounting firm Friedman LLP, shows it had $443 million and 1,590 euros ($1,970) in bank accounts as of Sept. 15. Tether tokens were valued at $420 million that day
Tomi Engdahl says:
Fools and their crypto
https://techcrunch.com/2018/01/30/fools-and-their-crypto/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Two days ago a Lithuanian “company” called Prodeum looked like a promising if silly blockchain startup.
Prodeum followed the token sale playbook from beginning to end. They created two tokens, one for funding the company and one for paying within the “network.” They created a credible whitepaper that, at the very least, tickled some of the neophilic nerves, and they had an active, if scammy, social media presence. That is literally all you need to run an ICO these days, and they did exactly as expected.
Then the whole thing imploded.
On the 28th the scam shut down, leaving a website containing a single word: penis.
“Remember that all ICOs are scams,” he writes in closing.
The token sale economy is half-baked.
So how do you, the startup fan, invest in these? Which ones work? Assume, for the sake of argument, that the token economy is a real thing and will lead, eventually, to a true utopia of token-based equity and utility coins. Because of the lack of oversight, no one in the space can be trusted
Tomi Engdahl says:
Samsung confirms it is making ASIC chips for cryptocurrency mining
https://techcrunch.com/2018/01/31/samsung-confirms-asic-chips/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
Fresh from toppling Intel as the planet’s biggest seller of chipsets, Samsung has confirmed that it has begun manufacturing ASIC chips which are used to mine bitcoin, ether and other cryptocurrencies.
“Samsung’s foundry business is currently engaged in the manufacturing of cryptocurrency mining chips. However we are unable to disclose further details regarding our customers,”
Tomi Engdahl says:
TSMC lands big orders for mining ASICs from Bitmain
http://www.digitimes.com/news/a20180130PD208.html
Taiwan semiconductor firms will see major revenue boosts from the global cryptocurrency mining craze in 2018, as Taiwan Semiconductor Manufacturing Company (TSMC) has landed sizable orders from Bitmain, China’s leading Bitcoin ASIC designer, for fabricating mining chips, while Advanced Semiconductor Engineering (ASE) and TSMC-affiliated Global Unichip have shared the backend packaging and testing orders, according to industry sources.
The sources said despite warnings by governments and financial institutions of many countries against speculative trading of virtual currencies including Bitcoin, Ethereum, Litecoin and Ripple, the ensuing windfall profits have added fuels to the mining craze, leading to lingering robust market demand for Bitcoin mining ASICs or GPU chips for mining and prompting global supply chains to cash in on the lucrative business opportunities.
Bitmain can not only design ASICs, but also supply mining machines and build mining grounds. The company has squeezed into TSMC’s list of major customers by placing large-size orders with the foundry house for fabricating ASIC mining chips and AI (artificial intelligence) chips on 16nm FinFET process, industry sources said.
Tomi Engdahl says:
ICO “rounds” are coming
https://techcrunch.com/2018/01/31/ico-rounds-are-coming/?ncid=rss&utm_source=tcfbpage&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=FaceBook&sr_share=facebook
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ICO “rounds” are coming
Posted 13 hours ago by Connie Loizos (@cookie)
Last summer, the news came in dribs and drabs about initial coin offerings, the crowd sales of new cryptocurrencies that give entrepreneurs access to funding. A warning here that some coins sold in ICOs could be considered securities. An alert there that celebrity endorsements of ICOs might be unlawful.
Fast forward, and the warnings are starting to come with the kind of velocity that should give founders who are contemplating ICOs some pause. In fact, suggest some in the crypto industry, these founders would be smart to start structuring their ICOs more like traditional venture rounds.
Certainly, it seems like things are headed in that direction.