Five privacy-focussed cryptocurrencies you need to know about

While Bitcoin represents an open and transparent peer-to-peer monetary system, its use hasn’t granted participants the privacy once thought. While Bitcoin is pseudonymous in that the identities of transacting parties are obscured, trades aren’t anonymous – meaning that transaction details and transferred funds are open to all to see.

Those seeking to conduct private transactions can, however, turn to privacy coins – cryptocurrencies that intentionally obscure or obfuscate the details and/or identities of transacting parties.

Monero

Originally created in 2014, Monero is sometimes recognized as the most visible privacy coin.

Monero leverages the concept of ring confidential transactions – a means which essentially bundles together sending and recipient addresses and renders transaction flows opaque. Further, technologies such as ring signatures and stealth addresses can obscure both the sender and receiver in any given transaction.

For these reasons, Monero has quickly risen in popularity – and its focus on privacy has presented a strong focus on fungibility.

Zcash

In a somewhat alternative approach to the protocols leveraged by Dash and Monero, Zcash has risen to fame for its use of ‘zero-knowledge proofs’ (called zk-SNARKS).

Fundamentally, this allows data recorded on a blockchain to serve as a private means of verification. The Zcash enables the encryption of both sender and recipient addresses alongside transaction amounts – meaning that any analyst attempting to determine the origin, destination, and nature of a given transaction might well be stymied.

Importantly, Zcash does not obfuscate the IP addresses of its users – meaning that Zcash cannot hide personal identifiers linked to public data.

Bitcoin Private

A newer entrant on the list of privacy-focussed cryptocurrencies, Bitcoin Private has its origins as a ‘merge fork’ of Zclassic and Bitcoin.

If that doesn’t make any sense, let’s back up.

In the beginning, Bitcoin itself was forked into Zcash, which was then again forked into Zclassic. Earlier this year, Zclassic proponents elected to re-brand the cryptocurrency project to Bitcoin Private in a bid to enthrall new users by using the Bitcoin brand name. Fortunately, the bid paid off, and Bitcoin Private is now ranked as one of the top 100 cryptocurrencies by market cap.

Bitcoin Private essentially introduces Zcash’s zk-SNARKS technology to Bitcoin users, and offers both a larger block size and advocates ‘decentralized mining’ through ASIC resistance.

Dash

Digital Cash, or Dash, originally started life as DarkCoin – a privacy-focussed effort. Today, Dash is one of the largest cryptocurrencies by its market capacity alone, which presently stands at some $2 billion USD.

Dash is unique in the sense that it provides both a transparent and ‘opaque’ method of transaction. While Dash users can opt to issue Instant transactions which are recorded on a blockchain similarly to how the Bitcoin blockchain functions, transacting parties can also use its PrivateSend feature, which uses a decentralized ‘mixing’ service.

Essentially, this enables three or more participants to pool their funds – leaving any intended transaction obfuscated. The cryptocurrency has its limits, however, and at present only allows 1,000 DASH to be spent per PrivateSend transaction.

Verge

Similarly to Dash, Verge is a newer cryptocurrency which offers its users the option to either send public or private transactions.

Verge leverages its ‘Wraith Protocol’ to enable users to differentiate between sending transactions on a private or public ledger.

Unlike other privacy-focussed cryptocurrencies, Verge does not ensure cryptographic privacy – instead, the cryptocurrency uses Tor and I2P routing to conceal a user’s identity when participating in transactions.

Verge has, however, suffered numerous hacking attempts in the recent past, which has seen malicious parties walk off with undisclosed sums.

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Three of the world’s most destructive initial coin offering scams

When you hear about initial coin offerings (ICOs),you might feel guarded and cautious for a number of reasons.

Whether they are good projects that just couldn’t make it work or bad projects that just couldn’t help steal from their investors, ICOs have a tarnished reputation.

Here we dive into the top three most ludicrous tales of scam artists attempting to paint pictures of deceit and malice with an initial coin offering canvas.

OneCoin

Having been officially tacked as a “clear Ponzi scheme” in India in July 2017, OneCoin has seen a number of investigations over the past year and a half as well as being slapped with a €2.5 million EUR fine by Italian authorities two months later.

The operation immediately had an air suspicion around it and the red flags were waving cautionary signs from the get-go. OneCoin never operated a legitimate decentralized virtual currency, it had no public ledger and also its offices in Bulgaria had been raided at the beginning of the year and authorities seized the company’s servers while continuing to build court cases against the company.

The warning bells were loud and clear and countries globally were able to get to the heart of it: OneCoin is quite simply a colossal scam.

The plot thickens to a soup of scandal. Rewind back to 2016, when over $30 million USD of CoinOne funds were seized by Chinese authorities in an investigation of the company’s operation in the country reminds us that things were always a little shifty.

And fast-forward to last year, OneCoin claimed to be officially registered in Vietnam and this was shot down as nonsense by the country’s government. Numerous countries, including Thailand, Bulgaria, Finland, and Norway, have told investors the cautionary tales of the risks involved if they ultimately decide to choose to sink their money into the company’s pockets.

Pincoin and iFan

Run by the same Vietnamese-based company, Modern Tech, it is believed that Pincoin and iFan managed to fiddle with the pockets of 32,000 investors, claiming a combined total of $660 million USD.

News of the Modern Tech’s alleged theft took place in April and the company then packed up its offices – ensuring not to leave the investors’ money behind – and shipped off from Ho Chi Minh city in March.

Local news had followed the story and reported that “Modern Tech left and liquidated a contract about one month ago [ in March],”  and gave the suspicious follow up that. “[no] one knows where they are located now.

When the company refused to process cash withdrawals, angry investors took to protesting the Modern Tech offices in the first weeks of April, but their actions were in vain – the offices were empty. Ho Chi Minh administration then roped the cops in and an investigation over the fraud was launched.

The two-fold scam, which is believed to be the biggest in ICO history, saw both companies acting in multi-level marketing schemes. iFan masqueraded itself as a social media platform catering for celebrities to promote their media to their fans while Pincoin promised a 40% chunk of monthly come-backs on investments that users had made. The entire project also claimed to be in the process of developing a blockchain-based online platform – bringing an ad network, auction and investment portal, and a peer-to-peer marketplace to the good streets of Ho Chi Minh.

They kept the fraud internationally entitled, too, in trying to sneakily prey on the out-of-town investors. Both projects were advertised to investors as potential foreign brands: iFan labeled slapped itself with a Singapore heritage and Pincoin said it hailed from India.

It further seems that Modern Tech dabbled not only in fraud but in a healthy game of lying. The company said there was only one official representative for both coins in Vietnam, meanwhile back at the ranch, the media confirmed that it was, in fact, seven Vietnamese executives who behind the projects.

Online suspicions had surrounded Pincoin for months prior and the financial scam directory Behind MLM released a review in February of this year detailing various economic aspects of the project.

Both scheme’s websites remain up and running; Pincoin still has the original content along with iFan which posed itself as a means to bridge the gap between celebrities and their fans.

Centratech

An ICO which has a story which reads like a teenager’s high-school essay. From false endorsements to misleading marketing, Centratech is one of the cryptocurrency’s biggest scams to date – with ego, money, and malice all creating a whirlpool of investor’s lost funds.

Centratech was well-known for having the backing of boxing champion Floyd Mayweather and DJ Khaled, one of Youtube’s most amusing snap-chatters, and many believed that with the celebrity endorsements, the project was set for success.

It turns out that the company was found to not only pay off the celebrity sponsors in order to entice loyal investors, it created a fake ‘team of prominent executive developers’ to further their starry reputation. The founders also attempted to boast deal made with payment provider’s giants such as Visa and Mastercard, which both companies later confirmed to be nonsense partnerships.

With two founders arrested on charges of fraud and a third wrapped up in legal cases, the tables have turned and the money stolen has come back with a vengeance. The ICO which raised around $32 million USD could easily hold itself as one of the most ludicrously contentious scams of ICOs so far.

In a blaze of fire, the ICO lost all credibility when the US Securities Exchange and Commission released a complains document which emphasizes the extreme – and malicious – ways in which two of the founders, Sohrab “Sam” Sharma and Robert Farkas, took to scam investors. The document outlines:

“The SEC also alleges that to promote the ICO, Sharma and Farkas created fictional executives with impressive biographies, posted false or misleading marketing materials to Centra’s website, and paid celebrities to tout the ICO on social media.”

The country’s regulatory authorities are also in search of a permanent injunction and hope that this will ensure that Sharma and Farkas will reimburse the investors their stolen funds with interest. The company’s two creators will further be banned from fulfilling the role of any company’s officers or directors and has been shunned from any participation in any securities activity.

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“Cryptocurrencies will change the world, in a way that Bitcoin could have” – an interview with Vinny Lingham

Welcome to the third episode of the CoinInsider.com podcast, Coin Dive!

In this episode, we talk to Vinny Lingham about his views on Bitcoin and Bitcoin Cash, explore his stance on new cryptocurrency projects, and unpack Civic’s direction.

Tune in – questions we asked during this interview:

  • How do you feel about the nickname you’ve earned? Bitcoin Oracle?
  • You didn’t start out in bitcoin or cryptocurrency. You’re from a small city in South Africa and your first big success was Yola a website building platform. Tell us how and why you entered the world of cryptocurrency.
  • Tell me how you see the world right now – do you think Bitcoin and the broader cryptocurrency space is really going to change the world in the way we all think? Why?
  • You famously stood for/behind and entrenched in the Bitcoin community for years. It seems you have started to put your support behind Bitcoin Cash recently. Why?
  • Have you met Roger Ver in person? What do you think of his approach to marketing/promoting Bitcoin Cash? Is Bitcoin Cash not suffering the cult of personality?
  • What is the Bitcoin community fundamental screwing up right now?
  • Are you still holding BTC?
  • Let’s talk about Bitcoin Foundation – you are a board member at the foundation, practically what does the foundation do and what is your role?
  • What are some of the most interesting blockchain business you’ve seen?
  • Are there any industries that the blockchain community isn’t thinking about yet? Are there some gems being missed?
  • Who is the one person you’d like to have lunch within the community? Not Satoshi.
  • Lastly, give our listeners an update about your secure identity startup, Civic. How has adoption been? How did the token sale go? What’s next on the horizon?

Join us each week!

Coin Dive catches up with leading luminaries in the cryptocurrency space and explores the ideologies and viewpoint of those right at the beating heart of the blockchain industry. Join our CEO and host, Nic Haralambous, on CoinInsider.com and through our SoundCloud page.

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A tumultuous 2018 – what your portfolio would look like if you had invested on January 1st

2018 hasn’t exactly been the kindest year to new cryptocurrency investors. While December of 2017 saw record highs, January of 2018 brought with it a swift reality check.

Selloffs, regulatory pressure, and community friction dogged the opening months of 2018 – and by April 2nd, the cryptocurrency market had lost 59% of its total market capitalization since the start of January.

For those brave enough to wade into a brave new world on the 1st of January in 2018, what might their portfolio look like today?

For this exercise, we’ll be considering a nominal investment of $1,000 USD in our opening play, and consider what profit (or loss) investors may have made should they have held on to their funds to date.

Bitcoin

On the 1st of January, Bitcoin began trading at values north of $14,000 USD – a value the world’s leading cryptocurrency has yet to return to – while its market capitalization stood at $236,724,393,290 USD.

2018 has seen an interesting foray for Bitcoin, where SegWit has been slowly adopted by a number of wallet platforms and work on the Lightning Network soldiers on.

Bitcoin’s high point touched $17,462 USD on the 6th of January, while the pre-eminent cryptocurrency fell to its lowest point of $6,182 USD on the 6th of February.

Investors placing a $1,000 USD bet on Bitcoin on January 1st would sit with a 36.39% loss today, with just $636,05 USD remaining in their wallets.

Ethereum

On the January 1st, Ethereum traded above $755 USD, and bore a total market capitalization of $73,075,799,389 USD.

Wading into 2018, Ethereum on the one hand has been bolstered by new scaling proposals, while on the other community frictions surrounding controversial proposals and the threat of ASIC mining have threatened the harmony of its developer forums.

Ethereum succeeded in touching new ceilings at $1,401 USD on the 13th of January, while platform later plummeted to trade at $590 USD on the 6th of February.

Investors purchasing $1,000 USD worth of Ether on January 1st would sit with a 3.8% loss today, with $962.02 USD left of their initial investment.

Ripple

Ripple’s XRP began 2018 by trading at $2.30 USD, and bore a total market capitalization of $88,945,851,351 USD.

Ripple has perhaps had one of the toughest starts to the year, having launched into 2018 under regulatory pressure and a review as to whether XRP itself constitutes a security.

The digital currency’s next high point came swiftly thereafter, wherein XRP traded at a high of $3.75 USD on the 4th of January.

What goes up must come down, however, and Ripple later fell to just $0.6 USD on the 6th of February.

Should investors have thrown in $1,000 USD behind Ripple, they’d have lost 62.53% of their initial investment – sitting with just $374,74 USD.

Bitcoin Cash

Bitcoin Cash made its opening splash at $2,534 USD on January 1st, and rode into town with a total market capitalization of $42,804,776,579 USD.

Bitcoin Cash’s relatively steady opening in 2018 lays the groundwork for the cryptocurrency’s future plans, including a new hard fork that will introduce 32-megabyte blocks.

On the 7th of January, Bitcoin Cash reach its pinnacle thus far by trading at values of $2,948 USD, and subsequently fell to a low of $796.65 USD on the 6th of February.

Investors rallying behind Bitcoin’s pre-eminent fork with a $1,000 USD investment would have lost 39.53% of their initial play, and would be left with just $604.39 USD in their wallet today.

Cardano

Cardano roared into 2018 as the 5th largest cryptocurrency by total market cap, and subsquently has dropped to 7th place. The cryptocurrency began 2018 by trading at values north of $0.71 USD on January 1st, at which time it enjoyed a total market cap of $18,637,596,875 USD.

Cardano has been the subject of a quiet year in the press, and has seen some of its thunder stolen by other blockchain projects.

A high followed shortly thereafter, as the project touched values of $1.27 USD on January 5th, while a reversal of fortune on the 19th of March saw prices plummet to just $0.12 USD.

A $1,000 USD investment behind Cardano on January 1st would have seen investors lose 61.99% of their initial investment, and would be left with just $380,11 USD.

Bonus: EOS

Given that EOS quickly surpassed Cardano to become the 5th most valuable cryptocurrency project by market cap, let’s unpack what investors with eagle eyes might have accomplished had they invested on January 1st.

Enjoying a fruitful 2018, EOS’ official launch is scheduled for June, while the platform has found a home in a variety of settings – not least including Tesloop’s ride-share platform.

EOS began trading at values north of $8.77 USD on January 1st, with the project bearing a total market cap of $5,041,596,077 USD.

EOS fell to the $3.97 USD mark on the 18th of March, while 2018’s high point thus far occurred on the 29th of April, where prices touched $22.66 USD.

Had investors placed $1000 USD behind EOS on January 1st, they would have made a $815.45 USD profit – totalling $1,815.45 – and achieving an 81.54% return on their initial investment.

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The world’s five worst initial coin offering failures

With new projects trying to get off the ground in a creative way by raising funds, the concept of an initial coin offering (ICO) can be both an incredible way for a company to succeed or an abysmal failure seeing the loss of funds, trust and reputation.

Here, we take a look at five of the most controversial falls from grace in ICO history.

Swisscoin

SwissCoin

Sometimes ICOs make controversial news because they fail owing to mistakes and problems. Other times the controversy is in their ‘success’.

Enter SwissCoin, which promised a brand new system which would offer instant, interest-free payments across the globe. Although this might sound great, the fact that the project offered no white paper and no legitimate information from the developers wasn’t exactly optimal.

The Ukranian Prosecutors thought the same thing and brought the project to a close, calling it the fraudulent scheme that it seemed to be, but not before the founders managed to swindle more than $500,000 USD from willing – and unlucky – investors.

Enigma

Hoping to achieve safety on the blockchain as a new project, Enigma ironically failed because of a breach of security in one of the most major hacks seen in cryptocurrency.

The intention behind the token was to create a security and cryptographic coin which boasted a new means of encryption to achieve it. Enigma had planned to launch its ICO in September of 2017  to raise funds for the project but scammers were able instead to raise funds – for themselves.

Scammers managed to hack into the account of Enigma’s CEO, Guy Zizkind, because of simple mistakes such as not setting up a two-factor authentication precaution. The hackers got into Enigma’s mailing list, website, and Slack accounts ahead of the ICO. They used the Slack channel to gain funds from investors in an “early ICO”. While some investors saw the blaring red light of a scam, others weren’t so lucky and sunk their funds into the scam. The staggering mistake led to the hackers making off with an equally staggering near $500,000 USD in Ethereum.

Since then, Engima lost its cryptic nature and investors have been uninterested in the untrustworthy project.

CoinDash

The ICO of CoinDash met a swift end when the company revealed that the token sale had been compromised fairly soon after it began.

The project, which was hoping to become a successful “crypto-based social trading platform designed to help you create and maintain a winning portfolio of cryptocurrencies”, was able to raise $7.53 million USD – a massive amount for a young startup – but then disaster struck.

The Ethereum address into which the investors were plugging their funds was altered when an unidentified hacker got into the system and changed the address.

CoinDash shut their website down and announced the embarrassing incident, saying:

“Contributors that sent ETH to the fraudulent Ethereum address, which was maliciously placed on our website, and sent ETH to the CoinDash.io official address will receive their CDT tokens accordingly.”

Investors were furious and accused the company of operating an inside job, and the sale ended in an angry union of lost funds and a failed project.

The DAO

The story of another project with a fresh idea and top start ruined by hackers. The DAO was started in hopes to create a system which acted similarly to that of a venture capital fund, but in the cryptocurrency and decentralized space.

With a strong Slack community of over 5000 members, things for this project were looking good and looked as though it would only grow from there with the project managing to gain an overall sum of what was approximately $150 million USD worth of Ethereum.

The good times came to an abrupt end when an anti-pattern in the system was found, which led to hackers succeeding in stealing the funds leaving the project wounded and trust lost.

Tezos

Tezos

Known as one of the most controversial altcoins, Tezos started the way it ultimately ended – with a bang.

The ICO turned heads as it managed to gain a whopping $232 million USD in ICO and promised to bring an innovative order to the mayhem that other cryptocurrency networks brought, such as issues around Bitcoin and Ethereum.  The creators hoped to achieve a stability on blockchain by producing a way in which users could vote on upgrades to a blockchain network. If it was successful, it would bring a new light to a dark part of cryptocurrency developments.

And the multi-million project might have had a standing change except that it all came crashing down when unresolvable conflict within the team got in the way.

Complications arose when founders Arthur and Kathleen Breitman and Johann Gevers (who became the head of board in place of the Breitmans for reasons pertinent to national jurisdiction) no longer seemed to see eye-to-eye on who should control the project’s development. A 46-page document filed by the Breitmans to remove Gevers apparently wasn’t quite the right way to reconcile the differences and things started to fall apart. 

Between in-house fighting and multiple lawsuits, investors lost trust in the project despite the success that Tezos initially saw in the fund-raise. Tezos ultimately lives on under new leadership, but ultimately polarized investors and stands as one of the most painful reminders of an ICO-gone-wrong.

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Who created Bitcoin? Unpacking the mystery of Satoshi Nakamoto

In 2007, the world entered what has become retroactively titled as ‘The Great Recession’ – where falling housing-related assets contributed to a global financial crisis, which either crippled or toppled many of the world’s largest financial institutions. One year later, in 2008, a paper entitled Bitcoin: A Peer-to-Peer Electronic Cash System was passed around a cryptography mailing list – written by one Satoshi Nakamoto.

In the near-ten years since Bitcoin’s debut on the world stage, pundits around the world have speculated on the identity that underpins the pseudonym ‘Satoshi Nakamoto’ – hinting that one figure (or several) may have authored the white paper that became the genesis of blockchain technology and the wider cryptocurrency ecosystem.

Still, ten years later, nobody has been able to conclusively – nor publicly – prove who Satoshi Nakamoto might be.

Where did the idea of Bitcoin come from?

Bitcoin is not the first attempt at forming a digital currency, but is the most successful.

CyberCash, E-Gold, NetCash and other digital currency projects have all came before Bitcoin – however, all of these systems supported a centralized authority and were mostly written off as scams.

In the early 90s, an online collective of enthusiasts called the ‘cypherpunks’ met to discuss topics including mathematics, cryptography, computer programming, politics, and philosophy.

The cypherpunks‘ philosophy dictated that the world may be both functional with little-to-no government intervention, and instead informed the view that online privacy and cryptography may underpin trust in relationships between parties.

Bitcoin, as a currency, has often been labeled as a product of libertarian beliefs thanks to the fact that it is capable of operating outside of the ambit of governments and regulators.

Indeed, Bitcoin uses cryptography and mathematical proof to create a decentralized currency system where there is no central authority – a system aligned with the cypherpunks’ beliefs.

Who could Satoshi Nakamoto be?

Though no party has ever successfully uncovered the identity of Satoshi Nakamoto, several popular theories have prevailed that have linked figures involved in cryptography, mathematics, and computer programming with the Bitcoin white paper.

Nick Szabo

While Nick Szabo may or may not be Satoshi Nakamoto, the decentralized currency enthusiast is frequently thought to have been a helping hand in the creation of Bitcoin thanks to his prior involvement in developing ‘Bit Gold‘ – a digital currency that predates Bitcoin.

Notably, Bit Gold is thought to have been one of the earliest conceptual predecessors to Bitcoin, given the fact that network participants would leverage computing power to solve cryptographic puzzles where each puzzle solution would become part of the next challenge.

Szabo has frequently denied his involvement in developing Bitcoin, and has subsequently denied that he is Satoshi Nakamoto.

dorian prentice satoshi nakamoto

Dorian Prentice Satoshi Nakamoto

A curious case of ‘if the shoe fits’,  Californian resident Dorian Prentice Satoshi Nakamoto has been thought to have been the author behind the Bitcoin white paper.

Dorian Prentice Satoshi Nakamoto,  trained as a physicist at Cal Poly University, was first tipped as the author of Bitcoin’s white paper by Newsweek in 2014. Citing his scholarly background and libertarian ideology, journalist Leah McGrath Goodman contacted the academic to discuss his involvement in Bitcoin – to which Prentice responded “I am no longer involved in that and I cannot discuss it. It’s been turned over to other people. They are in charge of it now. I no longer have any connection.”

Dorian Prentice Satoshi Nakamoto later retracted his claims, elaborating that he had misunderstood the interview question to pertain to his work as a military contractor. In the years since, the academic has continually refuted notions that he wrote the Bitcoin white paper.

hal finney

Hal Finney

Born in May of 1956, Hal Finney was a cryptographer and computer scientist who was an early cypherpunk who was active on online forums and published several remailers.

Finney, notably, was the first Bitcoin recipient – having received a payment directly from Satoshi Nakamoto.

Given his involvement in the cypherpunks’ activities, his libertarian views, computer programming background and association with Satoshi Nakamoto, online spectators have frequently commented that Finney may well have been the anonymous Bitcoin author himself.

Finney, who was diagnosed with amyotrophic lateral sclerosis (ALS), ultimately passed away in 2014. Throughout the course of his later life, the computer scientist ardently refuted notions that he was, in fact, Satoshi Nakamoto.

Finney’s work has ultimately led others to believe that his connections to Dorian Prentice Satoshi Nakamoto (who he lived just streets away from) and his correspondence with Nick Szabo may indicate a wider involvement with Bitcoin than first assumed.

craig wright

Craig Wright

Born in October of 1970, Craig Wright is an Australian computer scientist. Though the subject of criticism, Wright has previously claimed to have been a part of the development team that created Bitcoin.

Notably, online media have often posited that Wright is Satoshi Nakamoto himself – a claim which the academic has done little to dispute.

In November of 2015, an anonymous source contacted popular technology news outlet Gizmodo claiming that Wright was Nakamoto, and that the email author had worked for him.

News publication Wired later published a story claiming that Wright was the hand behind the Bitcoin white paper, leading Australian authorities to raid his private home.

Wright went on to delete his public internet accounts and resurface in 2016, where he claimed to be Satoshi Nakamoto. Ultimately, however, Wright chose to retract his statement and to date has not offered public proof of his involvement in authoring the Bitcoin white paper.

Dave Kleiman

Dave Kleiman, born in 1967, was a forensic computer investigator and author. Following his death in 2013, the author’s estate has claimed that he was fundamental to the creation of Bitcoin.

Kleiman’s name first truly reached headlines earlier this year, where a pending lawsuit against Craig Wright describes that both men reportedly worked together to furnish Bitcoin into existence.

Court documents allege the two men collaborated from March of 2008 to develop the Bitcoin network. Following its launch, the two later supposedly sent each other Bitcoin transactions which were recorded on the blockchain.

Following his passing, Dave Kleiman’s brother – Ira Kleiman – elected to bring the lawsuit to bear against Wright, claiming that Dave Kleiman had informed him that he “might have left a legacy in the form of bitcoins and codes on hard drives held by the estate”.

Found after Kleiman’s death, an unfinished draft of a trust contract supposedly revealed that Wright had entrusted Kleiman with a sum of 1.1 million BTC in 2011, which Kleiman would return at a later date.

The funds were reportedly stored on a heavy-duty USB drive which Dave Kleiman kept on his person at all times. Ira Kleiman reportedly now owns the drive, but might not be able to access the contents given the fact that the late Kleiman apparently encrypted its contents with a proprietary cipher.

While court papers do not reveal either Craig Wright or Dave Kleiman as Satoshi Nakamoto, they do not that “For reasons not yet completely clear, they chose to keep their involvement in Bitcoin hidden from most of their family and friends. It is undeniable, however, that Craig and Dave were involved in Bitcoin from its inception and that they both accumulated a vast wealth of bitcoins from 2009 through 2013”.

Subsequently, the impending legal tussle centers around 1.1 million BTC (which translated to approximately $10 billion USD at the time), as well as including compensation for the claims of intellectual property.

Wright has previously confirmed Dave Kleiman’s involvement in authoring the Bitcoin white paper – leaving many to suspect that the cryptographer, or his brother, may have been Satoshi Nakamoto.

Why does it matter?

‘Satoshi Nakamoto’ has been granted with the favor of a following who have lauded the anonymous author’s work on the Bitcoin white paper and the conceptualization of a decentralized monetary system. However, that writer’s decision to remain anonymous instead may have gifted Bitcoin with the greatest asset possible.

Thanks to its lack of a visible developer, author, or even advertiser, Bitcoin is effectively decentralized from the influence of its creator.

Without a clear figurehead, Bitcoin proceeds by the will of its community alone – an attribute and detriment which many have cited as the factor that empowers its existence in the first instance, and also wrenches its developers apart as scaling concerns and other debates mount.

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What can I buy with Bitcoin? How retailers are adopting cryptocurrency

Bitcoin is the first example of a peer to peer money and is not controlled by any central authority.

Bitcoin’s future, and its future value, will be determined by how people around the world accept and use it. Arguably, at present, Bitcoin has become a form of ‘digital gold’ through which investors have stored their money. In the near future, should merchants around the world accept Bitcoin as tender for goods or services, we may be able to see the cryptocurrency become a more active means of exchange similar to how a fiat currency operates.

What was Bitcoin designed for?

As outlined in the Satoshi Nakamoto white paper, Bitcoin was designed to be a decentralized peer-to-peer payments network. While the debate as to whether Bitcoin should first be a store of value or a means of transaction is a fuelling factor behind the Bitcoin Core and Bitcoin Cash feud, the Bitcoin network was intended to act as a monetary system that relied on cryptography and pseudonymity as its core pillars.

Ultimately, the use of any monetary system involves what is called retail acceptance – where persons or businesses accept a currency as tender for goods or services rendered. Should the Bitcoin network prove successful in its endeavor to connect users around the world in a decentralized monetary system, a clear marker of adoption would be the willingness of retailers, merchants, and industries to accept Bitcoin as payment.

Why would anyone accept Bitcoin?

Accepting Bitcoin has proven beneficial for several business ventures around the world for many reasons. Bitcoin enthusiasts – and supportive businesses alike – have noted that the Bitcoin network offers a speedy and efficient monetary system that can handle international transactions in minutes, and is not necessarily subject to regulation, oversight, or tax implications.

Blockchain technology ensures that transactions issued in Bitcoin are verified through cryptography and are inherently immutable – meaning that retailers accepting Bitcoin enjoy surety that transactions cannot be fraudulent.

While several businesses have succeeded in generating profits through holding Bitcoin as a speculative investment, others have witnessed a surge in popularity or media coverage for their willingness to accept digital currency as tender.

Bitcoin, however, has not been universally or seamlessly adopted as a payment standard. Retailers have been reluctant to accept Bitcoin as tender for several reasons. Chief among them, retailers have cited that Bitcoin’s volatile and fluctuating prices make the cryptocurrency undesirable as a payment standard given the fact that, as an asset, it may not hold its value once a transaction has been completed.

Further, the relative cost of Bitcoin transactions – which see stringent fees during periods of extreme network congestion – has been detrimental in the cryptocurrency’s use as tender for smaller ‘micropayments’. Lastly, Bitcoin’s increasing value has meant that investors may be more likely to ‘hold’ the digital currency as a speculative investment rather than use it to facilitate payments.

Who accepts Bitcoin?

Bitcoin unfortunately found an early home with denizens of the ‘dark web’ (portions of the internet not indexed by search engines) and was rapidly adopted as a payment mechanism thanks to its pseudonymity – meaning that, at the time, international regulators nor government agencies were able to trace monetary transfers between parties when conducting purchases of narcotics or illegal goods.

Bitcoin facilitated some of the transactions on a massive online black market called ‘The Silk Road’ prior to its shutdown by the United States Federal Bureau of Investigation.

Over time, however, criminal syndicates and black markets alike have largely shifted to using other means of transfer. Particularly, newer cryptocurrencies which offer near-total anonymity have proven popular amongst parties seeking to conduct transactions wherein oversight is undesirable.

Since those early days, Bitcoin has begun to find a home in both retail and between parties seeking an efficient and speedy means to facilitate transfers, meaning that many international firms and brands now accept the cryptocurrency as a form of payment.

While many individuals may presently accept Bitcoin as payment for their goods or services rendered, several leading internet companies have pioneered new payment standards which, for the first time, have brought cryptocurrency payments into the mainstream.

For example, Overstock.com – an online retailer – began accepting Bitcoin as a form of payment in 2014, and now allows customers to pay for goods in Ethereum, Litecoin, Dash, Monero, and Bitcoin Cash. Similarly, Newegg – an electronic retail giant – also accepts Bitcoin as a payment standard.

Microsoft became one of the first major technology companies to adopt Bitcoin, and enables consumers to use Bitcoin as a means to deposit funds into their Microsoft account, from where they can purchase games, movies, and apps on the company’s platforms.

Expedia – one of the world’s largest online travel booking agencies – also accepts Bitcoin. The service now enables consumers to pay for their hotel bookings in cryptocurrency.

Other major retailers who accept Bitcoin:

  • Reddit
  • OKCupid
  • Namecheap
  • CheapAir.com
  • Gyft
  • 4Chan.org
  • Mega.co.nz
  • Mint.com
  • Shopify
  • RE/MAX London

What can I buy with Bitcoin?

While several major retailers have led the charge in accepting Bitcoin as tender for general consumer goods, recent news has seen the cryptocurrency exchanged for high-profile assets, luxury goods, and unique experiences alike.

Several musicians such as Bjork and 50 Cent have garnered acclaim for their decision to accept cryptocurrency as tender, while Richard Branson’s Virgin Galactic further accepts Bitcoin from intrepid extra-terrestrial explorers.

While the trope of Bitcoin millionaires purchasing Lamborghinis may be overplayed, several automotive dealers have moved to accept Bitcoin as tender for vehicles. Notably, while off-the-wall concepts such as Australia’s all-terrain Tomcar can be bought using digital currency, business ventures such as BitPremier have emerged which specifically sell high-end cars in exchange for Bitcoin.

Real estate, too, has become a port-of-call for Bitcoin. Billionaire investors baroness Michelle Mone and Douglas Barrowman reached the headlines last year after the duo successfully sold 50 luxury apartments in Dubai in exchange for Bitcoin last year, as part of their sale strategy for the Aston Plaza and Residences.

Can I make donations in Bitcoin?

Several leading non-profits and charitable businesses have accepted Bitcoin as a means of donation – leveraging the cryptocurrency’s increasing value, ease of transfer, and – at times – its pseudonymity to raise funds for various causes around the world.

Several leading internet initiatives have signaled their willingness to accept Bitcoin. Wikipedia, the world’s foremost digital encyclopedia, accepts Bitcoin as a donation.

Similarly, The Internet Archive – a non-profit aimed at preserving portions of the internet for posterity – accepts Bitcoin, Litecoin, and Bitcoin Cash.

The Pirate Bay – an online index of open-source or pirated digital content of entertainment media and software – also accepts Bitcoin, in addition to Litecoin and Monero.

How else are cryptocurrencies being used in retail?

While Bitcoin may prove a leading light in terms of adoption and value, various retailers and initiatives have turned to blockchain technology to establish new ventures and payment schemes that leverage cryptocurrencies in a variety of interesting ways.

Rakuten’s loyalty program

Japanese online retail giant Rakuten recently revealed its plans to redevelop its ‘Super Points’ loyalty program. Dubbed ‘Rakuten Coin’, the project would be based on blockchain technology.

Company president Mikitani described Rakuten Coin as a “borderless currency”, elaborating that “basically, our concept is to recreate the network of retailers and merchants. We do not want to disconnect [them from their customers] but function as a catalyst. That is our philosophy, how to empower society not just provide more convenience”.

Daimler AG’s rewards initiative

German car manufacturing conglomerate Daimler AG has proceeded to launch its own blockchain-based digital currency dubbed Mobicoin.

As a rewards program, the project arrives as a bid to reward drivers for eco-friendly driving habits, and has kicked off in a new testing phase in which some 500 drivers will be rewarded for eco-friendly driving practices with the new cryptocurrency.

MobiCoin enables the transmission of telemetric details from vehicles to Daimler, wherein eco-friendly driving habits are analyzed and accordingly converted into the eponymous cryptocurrency. MobiCoin is set to reward drivers who travel at low speeds and practice gentle cornering, braking, and acceleration.

Drivers will be able to find their MobiCoins in an exclusive mobile app, and will be able to leverage their totals with VIP tickets for events such as the MercedesCup Final or Fashion Week in Berlin.

Amazon’s data dashboard

While Amazon hasn’t signaled its willingness to accept cryptocurrencies as tender for goods, the internet giant has recently been granted a patent which will allow users to receive cryptocurrency transactions data in an online marketplace.

Chiefly, the service would enable developers to “build real-time dashboards, capture exceptions and generate alerts, drive recommendations, and make other real-time business or operational decisions”.

How can we expect to use cryptocurrencies in the future?

The debut of cryptocurrencies such as Bitcoin on the international market-space may enable a revolution in retail acceptance and marketing that could fundamentally change the ways in which people accrue income and pay for goods.

The use of blockchain and smart contracts technology may enable a frictionless payment environment in the future, where customers may be able to easily pay for goods by simply walking into a store, pick up an item of their choice, and leave – and instead of waiting in a check-out, the use of surveillance technology coupled with cryptocurrency wallets might enable the ‘automatic’ processing of payments.

The equation might well work in reverse, and enable consumers to ‘rent’ their goods or owned services to accrue an income. The use of cryptocurrencies may even one day lead to the development of true passive income, or even the distribution of a universal basic income.

For now, however, the major stumbling block cryptocurrencies will need to cross is two-fold; the first will involve scalability, wherein cryptocurrency networks will need to be able to process thousands of transactions at once in order to facilitate global demand.

The second will be that of adoption, where retailers and services around the world will need to be convinced to accept cryptocurrency as a form of tender. Fortunately, it may not be long before this happens.

The post What can I buy with Bitcoin? How retailers are adopting cryptocurrency appeared first on Coin Insider.

Killing clickbait with cryptocurrency – where blockchain and publishing meet

The World Wide Web has been a tremendous democratizing force, enabling people to be better informed than ever before.

Developments like online advertising networks also made it possible for more people to make money from creating content. Charging for digital media, whether news articles, hit music, or comedy videos, was a difficult problem that online ads seemed to help solve.

It also linked the revenue news websites earn to views and clicks. Of course readership, circulation, and ratings have always been important measures of success, but the granularity with which you can measure things online brought with it an interesting set of problems.

Clickbait and for-profit fake news are two chief examples of behavior that is encouraged by linking revenue to clicks.

Defining clickbait and fake news

Unfortunately, the terms “clickbait” and “fake news” have been hijacked by online commenters to also mean “articles I don’t agree with.” Here clickbait is defined as something which is given a title that the content does not deliver on. This may be an article, video, or anything else which relies on its headline to draw a consumer in.

In its simplest terms, clickbait misleads and disappoints the audience. It is epitomized by phrases such as “you won’t believe what happened next” and “this one weird trick” in headlines, without anything surprising being revealed in the actual article.

“Fake news” is literally a lie that someone made up to trick people into clicking on and sharing a story, so they can make money from it. In the past, these may have been mostly benign urban legends that pranksters try to get people to share with one another, but the web has turned the practice ugly.

Neither clickbait nor fake news are new issues, but the scale of the Internet has made misleading headlines and outright lies into pretty lucrative business.

Getting people to pay for content

No-one wants to pay for content, but are quick to complain that quality is on the decline. People are happy for companies to fund their news outlets, but don’t want to see the ads and easily accuse media of being influenced by corporate interests.

The problem was neatly illustrated by Google in a recent blog post about Funding Choices, a new product that lets publishers block ad blockers, provided they offer “good ad experiences.”

Google explained in the post that Funding Choices presents browsers with the choice to either unblock ads or buy an “Ad Removal Pass” to see the site without advertisements.

“In the last month over 4.5 million visitors who were asked to allow ads said yes, creating over 90 million additional paying page views for those sites,” said Google. No mention just about anyone buying ad removal passes.

Reading between the lines, given a choice, people will generally want to see ads rather than pay to read articles online.

Solutions to this problem have already been developed for other forms of media, including music and video entertainment.

Apple showed through iTunes that with the right user experience and at the right price, it was possible to sell digital copies of music, movies, and TV shows. Services like Spotify and Netflix extended this to a monthly subscription model.

The news is has been waiting for its version of iTunes and Netflix, and cryptocurrencies and blockchain-based platforms may be the solution it’s been waiting for.

One-size-fits-all content policies

An area where digital marketplaces like iTunes and subscription services like Netflix don’t always excel is supporting smaller, independent creators who don’t want to rely exclusively on the ad network of a platform like YouTube.

Crowdfunding platforms like Kickstarter and Patreon address this particular need. Patreon is if of particular interest as it offers the ability to generate a regular salary from a community of patrons.

However, all these systems suffer from the same major drawback — you have to place your trust in them. The slightest change in policy, or misalignment of values, can result in a creator being cut off from their only source of income.

This can be as a result of conflicting political and moral views, or business reasons.

Patreon cracked down on adult content last year. It said that it will continue to allow nudity and suggestive imagery, much like a theatre might be allowed to show R-rated movies, but not porn.

The service’s decision to terminate the account of conservative gonzo journalist Lauren Southern was also controversial. Patreon CEO Jack Conte responded to the backlash in a YouTube video, stating that Southern had violated Patreon’s community guidelines by obstructing a search and rescue ship in the Mediterranean.

It also had to roll back a change last year where it was going to make patrons responsible for the transaction fees associated with their pledges, rather than deducting the money from creators.

Patreon said that it expected the change to be a welcome one, as creators would end up with more money at the end of the month. One of the main sources of complaints were patrons who set up many $1 donations to try and support several of their favorite creators with limited funds. Adding transaction fees onto their pledges caused their donations to increase significantly.

While some patrons on the platform canceled their pledges to protest the unilateral change, many those with several $1 pledges canceled because they said they could not afford to donate any more than they had signed up for.

YouTube has faced its own controversies over the years, ranging from copyright holders using its automated take-down system to censor creators expressing negative opinions about video games, to the “adpocalypse”

Comedians like Isaac Butterfield have also complained about YouTube’s automated video removal algorithm which flagged his video on political correctness and removed it from the platform.

The big issue plaguing YouTube at the moment, however, is the demonetization of videos deemed inappropriate. YouTube was responding to advertisers pulling out of the platform when their commercials were shown beside content they did not want to be associated with.

Longstanding members and prominent figures on the platform such as Felix Kjellberg (PewDiePie), Casey Neistat, and Philip DeFranco have all complained about having videos demonetized, whether due to swearing or other offensive behavior in their videos.

YouTube expanded on this policy recently to reduce the probability of “bad actors” earning ad revenue from the platform by increasing its minimum requirements to be eligible for monetization. Previously you needed 10,000-lifetime views on your channel to qualify for advertising revenue. From February 2018 you now need 4,000 hours of viewing time on your videos in the past year, as well as 1,000 subscribers.

Google was criticised for this most recent change as it effectively cut smaller YouTube channels off from earning any income from their work.

Using cryptocurrency to reward good content

Developments in distributed ledger technologies may help address all of these problems—from helping writers, podcasters, and video creators to get paid for their work, to disincentivizing behavior like clickbait.

Using cryptocurrencies, creators can be in control of their own destinies, while blockchain-based platforms are testing new models of rewarding creators for their work.

Services like Steemit and Minds are presented as alternatives to centralized social networks like Facebook, but their models could in time be expanded to cover professional creators too.

Both platforms use models that aim to reward its users for their time and contributions to the platform. Steemit’s rewards system lets you earn tokens on its blockchain, called STEEM, by authoring or curating content. When curating, you are paid out according to how popular a post you voted for proves to become. When writing, you are paid out according to how many votes your post receives.

Systems like this work against clickbait, as curators will hopefully not vote for a post where the content did not match the headline.

Similarly, systems which aim to measure attention on articles like Minds and the Basic Attention Token will penalize content where readers close misleading posts before finishing them.

Are Steemit and Minds succeeding?

The Minds ERC20 token is still very new and currently running on a test network. Whether the platform will be a success remains to be seen.

Steemit, on the other hand, has been around since 2016 and statistics regarding the number of posts being made, and active user numbers can be readily obtained from its blockchain.

There are posters on Steemit who produce daily reports based on this data, making it easy to see whether the platform is growing. The latest update from on such Steemit author, Arcange, shows that Steemit saw a spike in monthly active users in January.

Monthly active users on the platform have declined every month since then, but are still higher than the best month in 2017. Steemit’s Alexa rank is 1,368, also down from last month, but significantly higher when measured year-on-year.

Arcange’s post also shows an interesting phenomenon occurring on Steemit — authors sometimes embed their own advertising in their posts. These promotions can be for their own projects and other activities on Steemit, or just a banner ad in the content of their post.

Looking at Steemit’s Trending page reveals that it is a niche platform. The majority of successful posts are about cryptocurrencies or Steemit itself. There are also several posts about abuse of the platform’s mechanics, with the Burn Post initiative currently receiving significant STEEM rewards in support of its campaign to curb “vote-buying, bid bots, circle jerks, and other wasteful nonsense that is increasingly beginning to dominate the platform.”

Steemit has also been criticised for being too centralized a blockchain, with the developers holding far too much of the voting power on the platform. The organization has promised to decentralize the 41% stake the @steemit account holds, though it has said that it will be a “multi-year process.”

However, statistics from near the launch of the Steemit platform showed that the vast majority of STEEM tokens were in the hands of a vast minority of users on the platform, even when excluding the @steemit account.

Silver bullet

While these systems have not solved several crucial problems, they are on track to help decentralize creator rewards and offer alternatives to conventional online advertising models.

Besides the problems highlighted previously, the issue of seamlessness also still needs to tackled. The Basic Attention Token is attempting to address this by building the system into the Brave browser. However, the ability to pay for content needs to be made easier in general.

Another pitfall of platforms focused on social networking like Steemit is that they don’t effectively monetize a publisher’s longtail content. Like most social networks they not only favor new content, but basically disregard older posts.

Cryoptocurrency-based rewards systems also won’t solve the problem of echo chambers. It is expected that people will continue to vote for content they agree with, and won’t financially support things in conflict with their world-view.

These are not unsurmountable problems, but a reminder that there are no silver bullets to the challenges and opportunities out there, whether in the blockchain space or elsewhere.

The post Killing clickbait with cryptocurrency – where blockchain and publishing meet appeared first on Coin Insider.

The Blockchain Awakens: Imagining cryptocurrencies as Star Wars characters

When Star Wars (today retroactively titled A New Hope) first premiered in 1977, the emergence of what would become one of the most celebrated science fiction franchises of all time reignited not only a passion for fantasy, adventure, and mysticism, but further lead revolutions in both sound design, practical effects, and, more broadly speaking, the cultural adoption of film.

The paradigm shift Star Wars brought with it to cinema isn’t difficult to compare with the impact of cryptocurrencies on modern monetary systems. Cryptocurrencies and blockchain technology propose a shift in thinking that empowers a new generation of personal finance and peer-to-peer trade.

Like Star Wars, cryptocurrency hinges on an intersection where technology meets humanity, culture, and belief – and it’s not without a wry smile that we admit that like the story of a galaxy far, far away, the cryptocurrency world has brought with it its own slate of characters peppered with personas ranging from the heroic, the ominous, and at times, the plain silly.

Warning: If you haven’t watched the Star Wars saga, there may be some key spoilers in the content below.

Bitcoin: R2-D2

Though R2-D2 may be far from the most significant character in the Star Wars saga, everybody’s favorite trashcan-on-legs droid has witnessed the entirety of eight (and soon to be nine) feature films that comprise the core Star Wars story. There’s the argument to be made that Star Wars could be a story of R2-D2’s telling, given the plucky droid’s presence throughout the saga, his interaction with main characters, and his unwavering ability to save the day throughout many key moments in film.

Arriving on screen as the creation of an unknown creator, R2 succeeds in driving Star Wars’ plot forward – whether it be through acts as grand as saving starships or as simple as unlocking doors.

Bitcoin‘s emergence as the first decentralized, peer-to-peer money represents the genesis from which thousands of other cryptocurrencies have leaped forward – enabling a new belief in currency through reliance on cryptography, privacy, and technical soundness. Like R2-D2, had Bitcoin not existed, there may be no Star Wars story – or cryptocurrency ecosystem – to talk about.

Star Wars

Bitcoin Cash: C3-PO

R2-D2 needed a plucky companion with talents he didn’t possess, and George Lucas coupled the intrepid droid with C3-PO; the erstwhile protocol droid with talents in translation, functional modification, and incessant bickering with his partner.

Having been built by Anakin Skywalker, C3-PO serves the Star Wars saga as both a source of humor and context – extrapolating different dimensions to key plot scenes and bridging characters and audiences together.

That’s not to say we’re claiming that Roger Ver might be Anakin Skywalker in the world of cryptocurrency, but every hero needs a villain…

Bitcoin Cash, as the foremost hard fork to emerge from Bitcoin Core, is the scion of both love and scorn. Executing an alternate scaling path to the approach championed by Bitcoin Core, Bitcoin Cash brings with it inter-operability, several notable use cases, and a refreshing reminder that sometimes cryptocurrency developers just don’t have all the answers – something that C3-PO has proved especially good at in the Star Wars saga.

Ethereum: Darth Vader

Anakin Skywalker’s story in Star Wars is one that marks hope, a fall from grace, and eventual redemption as the Chosen One; a title which several cryptocurrency investors tout when referring to the Ethereum platform.

Like Anakin Skywalker (and his darker half, Darth Vader), the concept of Ethereum has enabled a wider revolution in blockchain platforms that could feasibly intersect with everyday life in many ways. Just as Anakin Skywalker was prophesized to defeat the Sith and bring balance to the Force, so to might Ethereum be the lynchpin that decentralizes applications and, more broadly, the web.

Though not explicitly a moral debate, the character’s transition from man to machine brings with it interesting parallels to Ethereum’s planned change from proof-of-work to proof-of-stake mechanics.

XRP: Emperor Palpatine

Courting foundations on Julius Caesar and other dictators, Star Wars’ Emperor Palpatine (in the prequels, Darth Sidious) represents one of film’s best-loved (and most-hated) machiavellian masterminds, whose scheme underpins both a galaxy-wide war and later a galaxy-wide despotic regime.

Ripple’s XRP is both loved and hated for similar reasons; rolling together the best and most applicable aspects of blockchain technology and the cryptocurrency ecosystem, yet meeting modern banking in a way that many cryptocurrency die-hards find abhorrent.

Palpatine’s ability to both play the likes of the Jedi, Republic, and later the Empire reflect just some of XRP’s utility and usability – where its speed and efficiency has rapidly found a home in several banking use-cases to the furor (and in some cases, admiration) of cryptocurrency enthusiasts.

EOS: Luke Skywalker

The principal hero of the original Star Wars trilogy, Luke Skywalker is the son of Anakin Skywalker (Darth Vader) – and the dynamic between the two is more than slightly reminiscent of that between Ethereum and EOS.

Similar in nature to Ethereum, EOS is a platform for decentralized applications that provides services like user authentication, server hosting, and cloud storage. 

If Star Wars’ original trilogy is the story of sons transcending their fathers, EOS’ relationship with Ethereum bears a close mirror – in perhaps the duo’s most remarkable difference, EOS already functions through proof-of-stake rather than through proof-of-work mechanics.

Like Luke Skywalker, EOS has quickly become a favorite among cryptocurrency investors – propelling the platform’s market cap to well over $15 billion USD.

Litecoin: Rey

Arriving on scene as a lovable scavenger with prodigious talents, Rey takes the role of the principal protagonist of the Star Wars sequel trilogy – rounding together Disney’s new take on the ethos of the original Star Wars trilogy and the technical vision of its prequels.

Litecoin launched and gained a loyal fanbase given its technical improvements over the Bitcoin Core network as well as its ability to maintain steadfast support and values despite tumultuous markets.

Rey’s quick ascension as the newest (and last?) Jedi closely mirrors Litecoin’s journey to becoming a fan-favourite cryptocurrency – with many touting the speed, efficiency, and integrity of ‘the silver to Bitcoin’s gold’ as leading reasons as to why the cryptocurrency may see many new adoption cases in the near future.

Dash: Princess Leia

The secret daughter of Anakin Skywalker and the adoptive daughter of royalty, Princess Leia continues to inspire a generation of strong female leads in cinema – a factor not dissimilar to Dash‘s debut in the cryptocurrency market space.

As a young senator and later leader of the Rebellion and Resistance, Leia counsels support from both the official, the vulnerable, and the brave at once – championing virtues of democracy and freedom.

Dash’s presence on the market – and its direction under the Dash Foundation – has seen the digital currency integrated as a solution for traders and investors alike in emerging markets under the direction of authoritative governments, such as Zimbabwe.

Dash’s employ of its Private Send feature carves a similar profile to the early double-life led by Leia as both a senator and leader of the Rebellion, while its use of masternodes derives strong support form its community in a manner not dissimilar to Leia’s command of the Resistance in The Force Awakens and The Last Jedi.

NEO: Kylo Ren

If Ethereum were Darth Vader, it’d make sense that NEO took on the role of Kylo Ren – a fellow practitioner of the dark arts, aiming to emulate its forbear, all the while under the direction of a secretive and authoritative government.

Like Kylo Ren, NEO is a newer figure that has managed to quickly develop a dedicated following. The blockchain platform, like Ethereum, serves to create a scalable network of decentralized applications, and as per Ethereum’s aspirations functions through proof-of-stake mechanics.

Though NEO might well lack Kylo Ren’s ferocity and volatile temper, the cryptocurrency has succeeded in quickly garnering acclaim as a favorable avenue for investors in a fashion that quietly resembles Kylo Ren’s reception with the Star Wars fanbase.

Zcash: Boba Fett

The last word in icy coolness, Boba Fett inspired a generation of Star Wars fans following his debut in The Empire Strikes Back. Despite facing a quick end at the hands (or tentacles?) of the Sarlacc Pit in Return of the Jedi, the character went on to meet an expanded telling in the saga’s prequel trilogy.

While Zcash may not be headed for a similar pit any time soon, the appeal of the privacy-focused cryptocurrency has echoed much of Boba Fett’s initial appeal – anonymity and mystery.

Leveraging zero-knowledge proofs to anonymize the relationship between providers, verifiers, as well as transacting parties, Zcash has quickly risen to prominence as one of the foremost privacy coins on the market – tussling with the likes of Monero.

The comparisons between Zcash and its bounty hunter likeness only increase when one considers the that the legions of forks that have arisen from the cryptocurrency aren’t too dissimilar from the pool of clones Boba Fett emerged from in the first instance.

Dogecoin: Jar Jar Binks

Alright, we couldn’t resist.

Dogecoin is, at times, the marveling factor and laughing stock of the cryptocurrency community – an erstwhile ‘joke’ coin that has somehow succeeded in developing a market cap worth more than half a billion US Dollars.

Jar Jar Binks, praised and reviled as The Phantom Menace‘s worst introduction, has similarly gone on to carve out an abrasive profile amongst Star Wars fans.

Met with skepticism and revulsion upon the release of the first of the Star Wars prequels, Binks has gone on to become the center of mystery – with several fans wondering if the character was not intended for a wider role than the non-stop barrage of infantile jokes that informed The Phantom Menace.

Dogecoin, similarly, has gone on to find an awkward place at the heart of the cryptocurrency community – with several ICOs moving to accept the digital currency as tender for the release of future tokens.

Star Wars, its characters, trademarks and licenses are the property of Lucasfilm and The Walt Disney Company.

The post The Blockchain Awakens: Imagining cryptocurrencies as Star Wars characters appeared first on Coin Insider.

Are cryptocurrencies the beginning of the passive income revolution?

Cryptocurrencies and libertarian ideologies have shared a difficult marriage.

Bitcoin, and its supporters, are often met with mixed reception in mainstream media for the so-called ‘war on banking’ and the potential to usurp classical governance structures.

The fear might be understandable, given that blockchain technology’s most significant attribute creates the potential for decentralized and trustless transactions which could theoretically unhinge the modern banking sector.

Subsequently, theorists have proposed that blockchain technology and cryptocurrencies could be the first step in allowing citizens around the world to eschew the banking system altogether, and instead develop a monetary system based on either a universal basic income, or opportunities that allow for passive income.

The question is, could blockchain technology and cryptocurrencies be the key in developing an economy of sharing, wherein every person in the world could potentially benefit from a passive income?

The gift of blockchain technology, combined with developments such as the lightning network and smart contracts, may effectively enable people around the world to use their possessions to generate passive income and, accordingly, sustain themselves.

What is passive income, really?

Passive income refers to money that is earned without active effort – sometimes, this refers to a situation wherein a person is able to leverage an existing asset (such as a property) to produce an income (for example, through leasing that property) without incurring effort or expense. One could consider renting one’s beach-side home while away on other business as a form of passive income.

Passive income can, at times, become conflated with the idea of residual income – simply put, residual income affords one set reward based on an action or series of actions, while passive income affords a person a monetary reward several times over for having performed one action or a series of actions.

Developments both in new cryptocurrency projects and consumer technology mean that the idea of passive income may one day be more broadly applicable than just to the likes of property or trust funds – leading to a future wherein digital currency holders may be able to sustain themselves simply by holding their cryptocurrency assets close to their chest.

Perhaps more interestingly, proponents have also punted the idea that blockchain technology might broadly enable both the ‘streaming’ of money for both income and expenditure.

How do cryptocurrencies support the idea of passive income?

Let’s use Bitcoin as an example. Thanks to a fixed supply of some 21 million coins, Bitcoin differs from fiat currency in that it is deflationary – its supply will decrease over time, making each unit more valuable.

When Bitcoin ‘miners’ create a ‘correct’ hash sequence, each block of transactions in the Bitcoin blockchain is ‘sealed off’. This process is called ‘proof of work’, and the miner responsible for verifying transactions is rewarded with an allocation of Bitcoins.

This process ensures that the influx of new bitcoins will eventually slow and then stop completely, and, further, that diminishing rewards will eventually see miners turn to user-provide transaction fees as a means of income.

Bitcoin – and blockchain technology – might fundamentally be able to sidestep the so-called ‘tragedy of the commons’ given the fact that, despite fundamentally acting in self-interest, miners inherently serve a public good and are essential to the operation of the Bitcoin network and are subsequently rewarded with a passive income.

Mining cryptocurrencies through proof-of-work, however, is inherently resource intensive and can therefore be exclusive to many people who cannot afford to purchase high-end mining rigs in the first place.

Newer cryptocurrencies have instead opted for a different mechanism called proof-of-stake that converts this process to one wherein coin holders are afforded network resources and authority relative to the coin holdings that they are prepared to ‘stake’ on a network.

In layman’s terms, while proof-of-work mining leverages processing power to solve increasingly difficult puzzles, proof-of-stake verification attributes mining power to the proportion of coins held by a miner in the first instance.

The method draws its name from the fact that in this scenario, a miner is limited to mining a percentage of transactions that is correlated with their ‘ownership’ stake in a network.

Proof-of-stake mechanics, in addition to the development of smart contracts, might well be instrumental in creating a worldwide monetary system in which complex financial arrangements could be easily conducted by algorithms.

Through this, we may arrive at a point in time where not only do certain cryptocurrencies provide a passive income, but newly invented economies of sharing could provide extra value to market participants using resources that they might take for granted at present.

Which cryptocurrencies could provide passive income?

Several leading cryptocurrency projects have the potential – through proof-of-stake mechanics – to deliver passive income. Newer cryptocurrencies have even gone so far as to leverage this process to pursue the creation of a universal basic income, which would provide every market participant with an opening value to transact within a system.

Passive income through proof-of-stake and masternodes

Some cryptocurrency projects have eschewed the paradigm created by proof-of-work mechanics to use proof-of-stake protocols to offer incentivation to market participants for either being a part of or performing specific functions in a particular network.

NEO – commonly referred to as the Chinese Ethereum – is a blockchain platform that rewards holders of NEO tokens. Investors interested in deriving a passive income through NEO need only stake their tokens in an official NEO wallet to be rewarded in GAS, which is the token used to pay for transactions on the NEO network.

In an alternate approach, Dash – short for digital cash – is another digital currency that provides its users with the opportunity to receive a passive income. Users running masternodes – specialized network nodes that can handle specific functions on a network – are able to receive an income for handling requests such as instant or private transactions on the Dash network. While Dash masternode operators are both required to have a significant capital outlay and technical knowledge, such users can be rewarded in DASH for fulfilling requests on the network over time.

Universal basic income

Recognising the fact that market participants are only valuable if they themselves hold value (currency) in a market space, some cryptocurrency projects have been designed to leverage blockchain technology and smart contracts to distribute a universal basic income to their participants.

Technically speaking, a universal basic income represents a form of welfare program in which all participants of an economy would receive a regular and unconditional sum of money from an issuer. Through such a program, every participant would recieve a form of passive income to sustain their economic activities.

While the success of such a project is, of course, limited to its adoption and eventual market capacity, initiatives such as Manna (formerly Grantcoin), Vialcoin, and Project UBU have taken up the banner of creating passive income opportunities through the distribution of a universal basic income.

Manna, specifically, has set itself the goal of becoming an alternative global reserve currency backed by a portfolio of assets that is held by a global NGO. The project has further planned to develop an API to interface with Ethereum, which would see Manna leverage the platform’s rules for the issuance, distribution, and execution of complex transactions.

Passive income through rental

Several cryptocurrencies have emerged with the view of creating passive income opportunities through unlocking previously dormant ‘real estate’ or ‘economies’ which could be used to create additional income.

One such example is SIA, which is a cryptocurrency platform designed to income through the rental of digital storage space. SIA’s cloud storage platform enables users to rent out spare storage capacity on their computers, where ‘providers’ are rewarded with Siacoins for providing storage space through smart contracts, and ‘renters’ pay for extra storage space in Siacoins.

Another noteworthy example is Golem, which aims to create a sharing economy by allowing users to rent out unused portions of their CPU. Providers receive Golem network tokens (GNT) for leasing out portions of their computer’s CPU, while ‘requestors’ can pay in GNT tokens to have complicated tasks (such as image rendering) performed across a decentralized spiderweb of worldwide processors.

How could consumer technology evolve?

Beyond the development of smart contracts on blockchain technology, consumer technology might well be the missing link in providing people around the world with money through a passive income.

Fundamentally, goods in the physical world will be the executors and deliverables of smart contracts and will principally need to be the vehicle through which smart contracts are initiated and later completed.

The development of the Internet of Things (where ordinary appliances or devices might benefit from an internet connection and become a ‘node’) could well accelerate the proliferation of smart contracts into the real world.

Several such projects have sought to leverage both an IoT device and the power of smart contracts; Tesloop, for example, is a ride-sharing service exclusively using autonomous fleets of Tesla motor vehicles. The company recently announced its CARMIQ platform, which would let Tesla owners rent out their vehicles to passengers. By way of a smart contract, autonomous Tesla cars could – while their owners do not need their vehicle – perform taxi services, accrue an income, and then return to their owner when requested.

What could the future hold?

Blockchain technology, smart contracts, and connected devices might one day propose a world where the idea of a single major salary, wage, source of wealth, or otherwise ‘active’ income becomes obsolete. Principally, we may be able to expect a future in which people around the world could simultaneously leverage their passive income to facilitate automatic expenditure frictionlessly.

While that future might be a ways off, it might well sit on the distant horizon – and whether cryptocurrencies are widely accepted might trigger the concept’s first true test.

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A war of faith: Will Bitcoin or Bitcoin Cash succeed?

Although many new investors may be unaware, there exists a battle for the heart and title of ‘the one true Bitcoin’ – a war between developers over ideology and progress, over technology and its potential, and – ultimately – for hearts and minds.

The differences between what we’ll term ‘Bitcoin Core’ and ‘Bitcoin Cash’, for reference, encapsulate a wider struggle in the cryptocurrency ecosystem – wherein developers have each made arguments as to how cryptocurrency projects and blockchain initiatives should scale to reach and serve a global audience.

The history of Bitcoin and Bitcoin Cash

The story first began in 2009 with the emergence of Satoshi Nakamoto’s Bitcoin white paper, which first outlined a peer to peer money that is not controlled by any central authority. Rather than have a middleman verify the legitimacy of transactions, Bitcoin relies on a blockchain – a distributed and decentralized ledger in which transactions are recorded and verified through cryptography.

The advent of Bitcoin remains a remarkable one, and is historic for the fact that it is, in principle, the very first monetary system that might reach a global audience and function effectively without the need of a financial intermediary.

While Satoshi Nakamoto has been revered for their work on the white paper and network that birthed the wider cryptocurrency market, the concept behind Bitcoin is not without flaw. The Bitcoin network is capable of processing a maximum of seven transactions per second, which – while this is an amazing achievement given the novelty of blockchain technology – sets up an early problem.

Firms such as Visa or Mastercard can process some 1700 transactions per second – meaning that developers need to find a method to ‘scale’ Bitcoin to ensure it can be used as a means of transaction by participants all over the world.

Fundamentally, this is a major key in ensuring that Bitcoin can fulfill its vision as a worldwide peer-to-peer payment network.

While Bitcoin itself was first detailed in Satoshi Nakamoto’s white paper, the cryptocurrency’s development community are in charge of building on the concept that first outlined the Bitcoin network. Such tweaking can not only comprise smaller adjustments or bug fixes – similarly to other software products – but can also involve principle changes that make new solutions possible.

For years, the development of the Bitcoin network has been under the stewardship of Bitcoin Core; a foundation of developers and programmers committed to making Satoshi Nakamoto’s dream a reality. Over time, however, key disagreements in Bitcoin Core’s community have prompted frictions and intense debates over which direction the cryptocurrency should head in.

A key roster of Bitcoin Core developers became concerned over time that Bitcoin Core’s leadership had not taken active steps to rapidly scale the cryptocurrency, and had become frustrated with the project’s apparent pace of development. These frictions were compounded by proposals that would introduce ‘second layer’ mechanics – put simply, networks that would run atop the Bitcoin network itself – that could potentially distance Bitcoin from Satoshi Nakamoto’s initial proposal and lead to the ‘centralization’ of Bitcoin.

Two of these proposals have drawn ire. SegWit2x – named Segregated Witness – would be a planned network upgrade that would restructure the composition of a block and reposition ‘signature’ data within a block to accommodate more room for transactions. The proposal draws the ‘2x’ in its name from its intent to double Bitcoin’s block size from one to two megabytes.

Secondly, development of the Lightning Network – a channelized peer-to-peer payments network built atop the Bitcoin network – would seek to create a distributed web of payment channels between users.

Angered developers argued that neither of these proposals meaningfully remedied the scaling difficulties experienced by the Bitcoin network, and did not inherently resolve the network’s limitations without resorting to third-party improvements or modifications that fell outside the scope of Satoshi Nakamoto’s white paper.

Further, fears arose that the development of SegWit2x and the introduction of the Lightning Network may render the ‘centralization’ of the Bitcoin network possible.

On August 1st of 2017, these tensions came to fruition as Bitcoin underwent a hard fork – a process wherein its blockchain split into two variants. While Bitcoin Core’s blockchain remained unmodified, a new blockchain for a network called Bitcoin Cash was created.

What are the technical differences between Bitcoin and Bitcoin Cash?

Bitcoin Cash’s blockchain adopted new rules which made it incompatible with Bitcoin Core. Chiefly, Bitcoin Cash proponents moved to adopt an 8-megabyte block size that could rapidly scale to accommodate more transactions per block, and further implemented an adjustable mining difficulty that could lessen or harden depending on the number of miners active on a network. Both of these moves would theoretically ensure that the Bitcoin Cash network would accommodate a greater volume of transaction throughput than its forebear, and would hence be able to serve a global economy with far greater readiness.

While the continuing development of both projects might have resolved itself, community tensions have only increased since the debut of Bitcoin Cash.

Principally, disagreements between Bitcoin Core and Bitcoin Cash developers have stoked arguments over which project is the ‘true’ Bitcoin as outlined by Satoshi Nakamoto. Proponents of Bitcoin Core have argued that Bitcoin Core is the logical answer given the fact that the underlying Bitcoin network would be largely unchanged – especially when using a second-layer solution to scale – and that Bitcoin Core enjoys a far greater market dominance on online exchanges.

Bitcoin Cash proponents have conversely argued that the Bitcoin Cash network is a logical expansion of Satoshi Nakamoto’s vision that does without the necessity of a second-layer solution, and would effectively proliferate the idea of a decentralized, peer-to-peer payments network to global users far more quickly effectively than Bitcoin Core would.

What are the ideological differences between Bitcoin and Bitcoin Cash?

In principle, the debate between both Bitcoin Core and Bitcoin Cash is a simple one. While it is accepted that good money by necessity needs to be a store of value (where it holds worth for a long period of time), means of exchange (where it can be used to pay for goods and services rendered), and unit of account (where goods can easily be valued and priced), both projects bear differing ideologies in how this paradigm should be achieved.

Bitcoin Core developers have argued that the correct process in developing ‘good’ money is to first achieve a store of value, which can then become a means of exchange and finally a unit of account. Given that gold has enjoyed similar properties, it has been argued that Bitcoin Core correctly emphasizes the technical ‘soundness’ of its product first, and deals with transaction mechanics as a secondary priority.

Bitcoin Cash developers have argued that ‘good’ money first needs to be accepted as an effective means of exchange before it can hold long-term value. Citing the fact that gold might hold market value but isn’t readily used in market transactions, Bitcoin Cash developers have argued that Bitcoin, by necessity, must be able to serve as many users as possible before accruing significant value.

So, which is the ‘real’ Bitcoin?

To put it simply, online communities have been divided. While Bitcoin Core developers have retained control of Bitcoin.org, Bitcoin Cash developers have taken control of both the ‘official’ Bitcoin news channel – news.bitcoin.com – as well as the former Bitcoin Core Twitter handle, @Bitcoin.

Reddit communities have further taken the brunt of community disagreements, as Bitcoin Cash supporters have, on occasion, flooded Bitcoin Core channels with Bitcoin Cash news.

The disagreements between both parties – as well as the ideological debate as to which Bitcoin network is the ‘true’ heir to Satoshi Nakamoto’s white paper – have created a confusing and potentially misleading avenue for first-time investors to tread. Both Bitcoin Core and Cash development parties stand to gain should new money flow into their respective projects – while Bitcoin Core remains adamant to retain its leading position in the market space, Bitcoin Cash remains determined to capture greater and greater portions of capital, increasing its market capacity.

Chiefly, this is where the battle will be decided – as many online exchanges, peer-to-peer services, and marketplaces will simply provide whichever project has the largest market capacity with the designation ‘Bitcoin’ or ‘BTC’. Ultimately, while both cryptocurrencies offer a unique and exciting investment option for interested parties, it is important to note that Bitcoin and Bitcoin Cash are mutually exclusive of one another and, essentially, do not represent the same end product.

Which ‘Bitcoin’ will succeed?

For the most part, Bitcoin Core has continued to retain its market dominance and the enthusiasm of new investors. Criticisms have been levied against Bitcoin Core developers for the project’s reliance on third-party scaling mechanics, and the fact that the project’s initial SegWit2x proposal was ultimately not implemented in its entirety. While Bitcoin Core remains the world’s leading cryptocurrency, the project has noted decreasing transaction volumes – signaling that investors may be more willing to hold on to the digital asset as a store of value rather than use it in everyday transactions.

Bitcoin Cash has succeeded in capturing its fair share of the market, and at the time of writing trades above the $1,300 USD mark. While the project’s pace and ambition in securing both new users, use cases, and technological advancements have been met with commendation, the initiative has also been the subject of criticism due to its adjustable mining difficulty and the fact that it has arguably misled several eager investors by marketing itself as ‘Bitcoin’.

Into the future, Bitcoin Core might well succeed in its vision thanks to the fact that it has been adopted as a commonly-used trading pair on online exchanges, that it already enjoys support from a wide pool of investors, users, and developers, and that the Bitcoin Core network is estimated to possess around 10x the number of network nodes that Bitcoin Cash employs.

However, Bitcoin Cash poses a strong threat to this narrative. When the Bitcoin network is saturated with an overwhelming flood of transactions, wait times can be longer and transaction fees can cost its users more – Bitcoin Cash instead accommodates users with faster transactions and cheaper fees. Miners, too, might be incentivized to move to Bitcoin Cash during periods where its adjustable difficulty has been lowered and profits may be higher.

Although Bitcoin and Bitcoin Cash are neither mutually exclusive ideas nor currencies, it remains unlikely that both will succeed side-by-side. Ultimately, if Bitcoin is poised to become a worldwide peer-to-peer money system, one ideology will take root and prove the path to reach the goal outlined by Satoshi Nakamoto – likely dooming the other to an existence spent in the shadow of the ‘true’ Bitcoin. The golden thumbs up – or down – sits in the confidence of worldwide investors.

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