Category: Cryptocurrency News (page 5 of 6)

Moscow Eyes Blockchain Tech for Infrastructure and Security

The Moscow City Government supports the optimization of the transport infrastructure with the use of blockchain technology through the “shared registry” system when it comes to controlling land-based transportation.

Blockchain technology will help create more transparent, just and reliable models for travel fare payment and system financing.

Sources in the room told Bitcoin Magazine that in a meeting with principal blockchain experts, Maksim Liksutov, deputy mayor of Moscow and head of the Moscow City Transport Agency, stated that the city’s primary task at the moment is to establish and support a safe and reliable data transmission system both within the department as well as with suppliers. He went on to suggest that a blockchain shared registry system would be an appropriate mechanism.

Liksutov was also enthusiastic about the potential for blockchain technology to facilitate the application of biometric information techniques, especially in terms of security solutions. He noted that with its data verification abilities, blockchain technology’s distributed nature could mean easier verification for travelers, while providing widespread confirmation of identities where necessary.

“Using blockchain technology in transactions between users and machines (which requires a high level of trust and permissions) is a question of time. This technology could be used also as an unprecedented anti-terror system,” the lead coordinator of Blockchain International, Alexander Mikheev, told Bitcoin Magazine.

According to the Mayor of Moscow, Sergey Sobyanin, these steps will become a part of a wider initiative the government will take to ensure advancement of new technologies. “Such projects are only begging to be realized in various areas, and we, without a doubt, owe it to ourselves to keep, in that respect, leading the array of cities across the globe,” Sobyanin said in a televised public address.

Among the other industries that will benefit from the integration of blockchain technology are the property sector, banks, health services, electrical power systems, digital commerce and tourism. “The users will just have to input their personal data once (or the company data), after which the information will be verified in the blockchain network in all the governmental and private structures, including banks and insurance companies,” Sobyanin said.

Written by Peter Chawaga for the Bitcoin Magazine | Original article: www.bitcoinmaga….

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One Bitcoin Just Became Worth More Than One Ounce of Gold

One bitcoin has now, at least briefly, been worth more than one ounce of gold, hitting $1239.9 at the bitcoin exchange Bitstamp, while an ounce of gold was priced at $1238.67.

The last time a single bitcoin might have been worth more than an ounce of gold happened in November 2013, more than three years ago. Having taken place based on Mt. Gox pricing models, possibly manipulated due to internal Mt. Gox trading bot(s), the legitimacy of bitcoin’s first dance with gold parity faces continued scrutiny. Regardless, the price of gold in bitcoin terms is now trading at an all-time low.

When, according to Mt. Gox, the bitcoin price exceeded that of an ounce of gold, it had just broken through the $1,000 threshold. Similarly, the bitcoin price crossed the $1,000 mark January 1 before gold-bitcoin parity in the first week of January 2017.

Everything You Need to Know Before SEC Bitcoin ETF DecisionIn April 2011, bitcoin realized parity with the US dollar. It later reached parity with silver (so nicknamed the “devil’s metal” for its ties to populism) at approximately $29.65 per bitcoin on February 19, 2013.

Bitcoin Outshines Troy Ounce of Gold in 2016

Bitcoin, long called ‘digital gold’ due to its strict coin creation protocol involving a computational process dubbed ‘mining,’ performed as a better safehaven, perhaps, than gold bullion.

Gold demand stoked by Negative Interest Rate Policies (NIRP) in Japan led to stalwart demand for the ‘yellow metal’ by July 2017. Gold fell nearly 20% for the remainder of the year.

Bitcoin increased more than 125% over the course of 2016. Fiat crises throughout 2016 in emerging or underdeveloped markets like India, China, Venezuela, and Greece is perceived to have benefited bitcoin more than gold.

Bitcoin: Gold’s “Digital Counterpart”

In “An Analysis of Bitcoin Exchange Rates,” economist Jacob Smith, who calls bitcoin a “digital counterpart” of gold,  “highlights the similarities between the traditional commodity and its new digital counterpart.” He writes:

…the most appropriate way to think about bitcoins is as digital gold. While nominal bitcoin prices are extremely volatile and seemingly uncorrelated with other nominal exchange rates, relative bitcoin prices or implied nominal exchange rates are indeed highly cointegrated with conventional market exchange rates. This mirrors the relationship between physical gold and conventional nominal exchange rates…

One Bitcoin is Now Worth More Than One Ounce of Gold for First Time
Casascius gold bitcoin.

The bitcoin and gold markets have long been intertwined. One of the most popular companies early in bitcoin’s existence, Casascius, produced the most expensive physical bitcoin ever produced, one of which sold for $1,000,000 in 2013.

Comprised of one ounce of fine gold (which was worth about one-third the value of 1,000 BTC when produced), Casascius offered the coins at $5,500. An owner of one such rare coin recently used bitcoin’s price rise as an opportunity to share the rarity on Reddit. The redditor explained how it worked:

“I have a confirmation code that proves that my passphrase unlocks an encrypted private key that maps to the bitcoin address on the coin,” the coin holder wrote. “If I ever sell these coins, I will give the passphrase and confirmation code to the buyer. So the only trust is that Mike Caldwell didn’t screw up and not put the correct encrypted private key under the hologram. So far, Mike’s work has been top notch. But of course, would you trust it with $1M if you have that kind of money? That is for you to decide. Do note that I have not funded these with any BTC.”

Everything You Need to Know Before SEC Bitcoin ETF Decision

At gold-bitcoin parity, the bitcoin market cap ($18 billion) expressed as a percent of gold in circulation ($7 trillion) is currently at about 0.388%. Bitcoiners see this as evidence of bitcoin’s room for growth.

The last time bitcoin approximated the gold price, however, it marked the top of the bull run in 2013 for the digital currency.

 

Written by Justin Connell for Bitcoin.com | Original article: news.bitcoin.co…

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Russian Bank’s VP Says Bitcoin is the Only Successful Blockchain

Over the past couple of months, Russian politicians and banks have been changing their tune when it comes to blockchain technology and cryptocurrency solutions. On February 21 Nikita Smirnov vice president of the state-owned bank Vnesheconombank had some positive things to say about the digital currency bitcoin. In fact, Smirnov believes the Bitcoin network is the only “successful” blockchain technology.

‘A New Philosophical Concept’

Russia’s relationship with digital currencies has been confusing, to say the least. Over the past few years, a few Russian bureaucrats have perceived bitcoin use as a criminal activity. Moreover, in the past, there have also been website blockades against bitcoin domains such as BTC-e and Localbitcoins. However, it seems politicians and banks are slowly changing their minds towards the country’s relationship with bitcoin. Just recently Russia’s Deputy Finance Minister, Alexey Moiseev told the public that bitcoin was “not a threat,” and Russia’s largest bank Sberbank has also been bolstering blockchain technology.

Now one of Russia’s well-known state banks Vnesheconombank (VEB) vice president has told the regional publication Kommersant that bitcoin has many benefits. Additionally, Nikita Smirnov says that bitcoin has an indisputable network effect.

“Bitcoin is the only blockchain technology in the world that has widespread adoption,” explains Smirnov. “It has existed for several years already, people tried to hack it, but no one has succeeded. So right now, if you ask whether there’s another algorithm, which established itself as a solution to distributed consensus problem, then the answer is probably NO.”

As of the present moment, the only successful solution to that problem is Bitcoin.

‘Bitcoin Forms a Symbiotic Relationship with Humans’

Meanwhile, the Russian bank Sberbank has been researching and developing its own enterprise-grade distributed ledger prototype for quite some time. Sberbank CEO Herman Gref believes commercial blockchains will be ready in two years and the company is working with the government on this project. However, according to the VEB vice president bitcoin is really the only successful blockchain today and can be considered a positive bacteria in his opinion.

Bitcoin is kind of a philosophical concept. Compare it to a bacteria, which exists separately from humans, but is in a symbiotic relationship with humans. But the word bacteria has a negative connotation, whereas Bitcoin in many ways is a positive thing, which satisfies many necessities, involves people in the process and allows itself to exists in this way.

Vnesheconombank also works with the Russian government managing state debts and pension funds. The bank, instituted in 1922, has grown significantly over the past few years acting as a progressive “Russian Development Bank.” Smirnov’s opinion may not reflect the bank’s official stance towards bitcoin but may push the bank to research the cryptocurrency further.

“[Bitcoin] truly is a new philosophical concept, which isn’t very well understood quite yet,” Smirnov concluded in his interview.


Written by Jamie Redman for Bitcoin.com | Original article: https://news.bitcoin.co….

What do you think about the vice president of Vnesheconombanks statements? Do you agree that Bitcoin is the only successful blockchain implementation? Let us know in the comments below.

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Bitcoin in Japan to be a Legal Payment Method Soon

Bitcoin will soon be legally recognized as a method of payment in Japan. The bill with provisions for cryptocurrencies has recently passed through the period of public consultation and will enter into force in April.

Bitcoin.com examines what the bill means and how it could affect Bitcoin with Special Counsel at Anderson Mori & Tomotsune, Ken Kawai, who has held numerous speaking engagements on the legal issues of virtual currency regulations in Japan.

Countdown: The Long Awaited Bill

Since Bitcoin’s inception, its legal position in Japan has not been clear. The first bill containing provisions for virtual currencies including Bitcoin was submitted to the Diet last
March. It amends the existing Payment Services Act and the Act on Preventing of Transfer of Criminal Proceeds.

“The revision of the Payment Services Act, which sets out the basic framework of virtual currency regulation, was promulgated last June”, Kawai told Bitcoin.com. The drafts of detailed regulations and guidelines were published in December and the period for public consultation on the bill ended on January 27, he continued, adding that:

The new regulations will enter into force in April 2017.

New Method of Payment but Not Currency

This bill defines virtual currencies including bitcoin and imposes
certain regulations on virtual currency exchange services with the aim to prevent money laundering and terrorist financing as well as to protect users.

While the bill recognizes them as a new method of payment in Japan, virtual currencies are not classified as “currencies” however. Kawai confirmed:

“Virtual currency” is distinguished clearly from “currency” in the regulations.

Even though Bitcoin is not considered a currency, being recognized by the government as a payment method will “likely
have a positive effect on people’s mind and facilitate usage of VC’s [virtual currencies]”, he believes.

Bitcoin usage has already been growing considerably in Japan. Japanese exchange Coincheck revealed significant growth in its user base, rising from 14,000 users last April to 76,400 in January. In addition, the exchange reported gigantic growth in the number of bitcoin-accepting merchants using its service. Also, Japanese giant GMO Internet group has recently announced that it would be developing a bitcoin exchange and wallet service.

Meanwhile, Japan now has the second-largest bitcoin trading volume globally, according to Coinhills.

Bitcoin’s Other Legal Considerations in Japan

While usage as a payment method should not be affected whether bitcoin is legally considered a ‘currency’ or not, Kawai explained that, from a legal standpoint, there are some considerable differences.

“For instance, if they are defined as “currencies”, lending of VCs must comply with Money Lending Control Act (which requires lenders to register as “Moneylenders”) and VCs’ derivatives must comply with the Financial Instrument Exchange Act”, he described.

Some other countries have classified virtual currency as an asset or property for tax purposes such as the U.S. Recently, Israel has issued a draft which considers Bitcoin an asset, therefore imposing Value Added Tax (VAT) as well as capital gains tax on bitcoin transactions.

However, for Japan, this bill does not define virtual currency as “property”. Instead, virtual currencies are defined as ‘proprietary value’, Kawai contrasted, adding that “a precedent of Tokyo District Court denies the concept of having ‘property rights’ of Bitcoin”. Furthermore, “it is not uncertain what is the legal nature of proprietary value in Japanese civil laws”, he clarified, adding that “I do not expect that the government is leaning towards proactively considering it as “property”.

 

Written by Kevin Helms for Bitcoin.com | Original article: https://news.bitcoin.co…

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Will Trump’s New Policies Boost U.S.–Mexico Bitcoin Remittances?

Last week, President Donald Trump signed an executive order to build a wall along the U.S.–Mexico border as he had promised during his presidential election campaign. Aside from the ethical and practical issues of building the border wall, the issue of how it will be financed was also raised by opponents during his campaign. Trump’s proposed solution to funding the wall is either to heavily tax U.S.–Mexico remittances or to fully prohibit them altogether, so that the funds needed to build the wall will stay in the U.S.

According to the World Bank, U.S.–based Mexican immigrants send around $26 billion annually to their families back home in Mexico. Trump’s proposed legislation would hit Mexican families that rely on remittances from their U.S.–based relatives hard. The Mexican economy would also suffer as the multibillion-dollar remittance inflow to Mexico adds substantially to the country’s domestic spending.

In light of Trump’s proposed policies to fund the border wall, remittances from the U.S. to Mexico jumped to a ten-year high after Trump’s election win in November in anticipation of possible legislation restricting cross-border money transfers to Mexico. Remittances in the month of November jumped by almost 25 percent compared to the same month the prior year, according to data collated by the Mexican central bank.

Will Bitcoin Be the Answer if New Legislation Is Imposed?

If U.S.–Mexico remittances using traditional channels such as banks or large money transfer operators (MTOs), such as Western Union or MoneyGram, are to be heavily taxed or severely restricted, then bitcoin remittances could offer a solution.

Bitcoin allows users to send and receive money from and to anywhere in the world at a very low cost using online or mobile wallets to make the transfer. Furthermore, legal restrictions on money transfers could easily be circumvented using the digital currency, as no paperwork needs to be filed when sending money abroad. That way, both documented and undocumented Mexican immigrants would still be able to send money back home without any restrictions, should the new laws be put in place.

Alternatively to bitcoin, anonymous digital currencies such as DASH, Monero or Zcash could also be used to make cross-border money transfers, should Trump decide to go through with his legislation and attempt to crack down on bitcoin remittances.

Bitcoin in Mexico

The main reason bitcoin hasn’t taken any notable market share of the $500 billion global remittance market is the challenge of transferring fiat currency into bitcoin and then bitcoin back into fiat currency without having to pay too much in bid/offer spread costs. Illiquid local exchanges in developing countries can easily hike up the cost of the remittance to the extent that it would make more sense to use traditional money transfer solutions.

Fortunately, for Mexican bitcoin users, there are several exchanges to choose from when needing to convert bitcoin into pesos or vice versa. Mexico’s main bitcoin exchanges include Bitso, Volabit and LocalBitcoins.

Given the liquidity of both U.S-based, Mexico-based and international exchanges that residents of the two nations have access to, the costs of converting bitcoin to and from fiat currency are reasonable low, making bitcoin remittances from the U.S. to Mexico a viable solution should Trump’s remittance restrictions be enforced. Furthermore, there are bitcoin remittance companies such as Abra and Cashaa that aim to make cashing out bitcoins in local fiat currency easier.

In terms of bitcoin regulation, Mexico has taken a stance similar to many of its international peers. In April 2014, Mexico’s National Commission for the Protection and Defense of Users of Financial Services issued a warning on the risks of using bitcoin stating that it is not legal tender and not regulated by the Mexican authorities. Therefore, the commission warned, “any individual or business that uses or accepts virtual currencies as a means of payment does so at their own risk and on their own responsibility because the use of this type of asset entails high volatility and potential monetary losses.” In other words, bitcoin is not illegal but the commission warns against its use due to the risks involved in dealing in the digital currency.

Not surprisingly, following Trump’s election win in November, bitcoin trading volumes in Mexico on global peer-to-peer exchange LocalBitcoins and on the country’s leading bitcoin exchange, Bitso, increased substantially as Mexican bitcoin users moved funds away from the weakening peso and into a better-performing currency.

Should Trump succeed in imposing strict remittance restrictions from the U.S. to Mexico, this could become the first case study of bitcoin remittance succeeding and actually become a viable means to make cross-border payments.

 

Written by Alex Lielacher for Bitcoin Magazine | Original article: www.bitcoinmaga…..

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As India Goes Cashless, Both E-Money Stocks and Bitcoin Benefit

India’s Prime Minister Narendra Modi announced on November 9, 2016, that 500 and 1000 rupee notes would be taken out of circulation in an effort to reduce corruption, terrorism, black money and counterfeiting, and will no longer be accepted as legal tender in India. His surprise announcement caused chaos in the country as citizens scrambled to adjust to a new monetary norm that banned about 85 percent of cash in circulation.

This move was meant to bring billions of dollars worth of unaccounted money back into India’s economy. The Indian economy has thus far run primarily on cash transactions. This, in turn, has left a substantial proportion of India’s national income unaccounted for, as it doesn’t fall into the tax net. According to a research note by Ambit Capital Research, the size of India’s untaxed black market economy is worth $460 billion. In a “cashless” India, financial transactions will be more easily traceable, and previously unaccounted transactions will not fall through the net of the tax authorities.

The demonetization of the two highest-denomination notes in India has led to an increase in the use of electronic payment services and is a big step toward a cashless society. This, in turn, has two key benefactors: e-money payment companies and bitcoin.

E-Money Stocks Are Rallying

As reported by Bloomberg, e-money stocks have soared since Prime Minister Modi announced that he wants India to become a cashless society. India’s publicly listed electronic cash companies’ stock prices have surged in the wake of the currency reform in November. They are expected to continue to outperform since the government has introduced a range of discounts for making digital instead of cash payments.

Of the 23 e-payment solutions companies listed on India’s National Stock Exchange, 5 have been key outperformers since the new currency reform.

The stock prices of e-commerce software developers Intense Technologies Ltd. and Vedavaag Systems Ltd. increased by over 50 percent, while e-payment service provider RS Software India Ltd., technology solutions provider Aurionpro Solutions Ltd. and telecom solutions provider Tanla Solutions Ltd. have all rallied by over 20 percent.

On the day after the announcement, Credit Suisse Singapore made a strategic investment in Vakrangee Ltd., which provides digital financial services to governments and lenders, by buying 3.83 million shares in the firm and thereby signaling that it is prepared to bet on the profitable future of this sector in India.

A. K. Prabhakar, Head of Research at IDBI Capital in Mumbai, told Bloomberg that his team expects “double-digit revenues growth for e-governance firms over the next 3 to 4 years if the government systematically encourages cashless transactions” and that “growth in digital modes of payments will continue to be strong if the safety is increased and charges are reduced.”

According to the Reserve Bank of India, digital payments have increased by almost 50 percent from November to December, which shows that the shift toward a cashless economy is happening despite initial chaos in the country. This development will bode well for e-payment solutions providers and mobile money services.

Bitcoin Is Booming in India

India’s aggressive move toward becoming a cashless society, however, is not only benefiting e-money companies.It has also created a boom for bitcoin in the world’s seventh largest economy.

According to data compiled by Coin Dance, trading volumes at peer-to-peer bitcoin exchange LocalBitcoins has spiked aggressively in India since November 9, while leading Indian bitcoin exchanges Zebpay, Unocoin and Coinsecure are witnessing a surge of new users coming onto their platform to exchange rupees for bitcoins.

According to Zebpay Co-Founder Saurabh Agarwal, Zebpay’s trade volumes have increased by 25 percent from October to November; they have had 50,000 new users sign up to their exchange in the month of November alone, well above the usual 20,000 new-user increases they have experienced in previous months.

Coinsecure experienced a 300 percent increase in user sign-ups in November, while Unocoin had their user base increase threefold in the wake of India’s currency reform.

While bitcoin merchant adoption is still next to none in India, the new currency reform and the subsequent push toward digital payments will give bitcoin a boost as a means of making online payments. More merchant adoption will also lead to more individuals adopting the digital currency, which, in turn, will help bitcoin flourish in India’s future cashless society.

Written by Alex Lielacher for the Bitcoin Magazine | Original article: https://bitcoinmagazine.co….

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WINGS, a Next-Generation Crowdfunding Community for Projects That Fly

WINGS, a decentralized platform for the creation, participation and management of Decentralized Autonomous Organizations (DAOs), is bringing to the crowdfunded blockchain space a visionary new model that builds community while offering opportunity.

WINGS can be described as mix between DAO, Augur and Kickstarter, allowing project DAO governance, prediction markets for startups potential, and a decentralized crowdfunding platform. More than that, the WINGS team is building an international community in the crypto space where members can build trust while evaluating new projects and funding those they like.

In traditional crowdfunding platforms like Kickstarter or GoFundMe, backers are rewarded with perks – typically early or free access to the product or service developed by the project. In next-generation crowdfunding platforms like WINGS, backers are rewarded with tokens and become stakeholders of a project, involved in decision-making, providing services and entitled to payments for services guaranteed through the DAO’s smart contracts. WINGS will enable project creators to submit proposals to the WINGS platform, and those meeting the approval of the community of WINGS users will be launched for crowdfunding by the community.

A year from now, the WINGS team hope that people will have such trust in its community that the first question asked of a new project is: “Does it have WINGS?”

Whether a new project can fly is evaluated by the WINGS community, by leveraging “swarm intelligence” – the wisdom of the crowd, augmented via prediction markets – to provide risk-assessment and potential evaluation. Projects will be scored by the community according to how realistic they are to achieve, how transparent the teams are, and whether their fundraising and other goals are realistic.

In a recent paper titled “DAOs, Democracy and Governance,” renowned futurist and cryptographer Ralph Merkle argued that DAOs and crowdsourcing could lead to better decision making and even new forms of democracy. “We call this new form of democracy a DAO Democracy,” said Merkle.

The current version of the WINGS white paper describes the platform as “the first project governance and backing social platform of its kind that utilizes novel technologies such as swarm intelligence through decentralized forecasting markets, smart contracts generators, focus on accessibility and community post-funding engagement, flexible governance and participation models, [and] deep learning assisted project evaluation.”

Forecasting markets borrow core concepts from prediction markets – speculative markets created for the purpose of making predictions. The current market price for a prediction ‒ for example the election of a particular candidate ‒ can be interpreted as an aggregate, crowdsourced estimate of the probability of the prediction.

In WINGS, forecasting markets are used to evaluate projects. Members of the WINGS community are asked to predict things like how much funding a project will receive, and whether its scheduled milestones – such as the successful product delivery or marketing campaign launch – will be met. Those who make accurate predictions receive the project tokens, providing the necessary financial and reputational incentive rewards, for taking an active role in project evaluation. Thus the WINGS team places a strong emphasis on the creation of a vibrant global community of committed participants.

With WINGS’ crowdsourced approach to filtering and focusing on quality projects, potential backers can see how a project is rated and valued by the community, and what the estimated chances are of a project achieving its milestones and final goals, which reduces the backers’ need to perform their own evaluation and research. Once submitted to WINGS, new project proposals are evaluated and forecasted by WINGS token holders, discussed, and amended (pivoted) by project creators if appropriate. This solves the “one-shot chance” problem that crowd-funded projects usually have, by enabling the project creator to fine-tune the offering before starting the actual crowdfunding. After the initial assessment, a successful proposal becomes a new DAO with a unique set of DAO smart contracts and digital tokens, and the crowdfunding begins. Once the crowdfunding period is completed, the new DAO starts operating according to the governance model and rules defined by its smart contracts. Besides direct voting, WINGS will support representative governance and “liquid democracy” with flexible delegation.

The WINGS technology stack will include Ethereum, its smart contract programming language Solidity, the RSK (Rootstock) implementation of Ethereum smart contracts asa Bitcoin sidechain, and integrate with a decentralized storage system such as IPFS or Swarm. Users will be able to interact with the WINGS platform not only via conventional web or desktop interfaces, but also via smart chatbots in popular messaging apps including Telegram, Slack, Facebook Chat and WeChat. Eventually, the WINGS team plans to leverage Artificial Intelligence (AI) technology to allow natural language user interaction with the platform.

“No other platform so far has integrated DAO technology or used crowd intelligence based forecast markets to help potential funders and project stakeholders understand whether a project will fail or fly,” WINGS team member Dominik Zynis, in charge of marketing and communications, told Bitcoin Magazine.

“Any project that wants input from stakeholders, any project that wants access to an international network and community that can give a social network boost to a project and help it grow, is suitable for WINGS,” explained Zynis. “Also any project that wants to build credibility with financial supporters by going through being evaluated by the WINGS community.”

WINGS wants to attract not only the backers and project creators, but also and especially those who want to get involved in projects as early adopters and opinion leaders, playing a strong role among their local constituency by providing support for projects, evangelizing, and building their local communities. Zynis noted that the WINGS team gives priority to getting people involved in supporting projects, over getting more people to start projects.

Zynis added that venture capitalists and bankers are interested in using the WINGS platform. “We’ll need to make adjustments to it to enable stock or debt equity, but the power is using a global community to value and evaluate projects,” he said. “So WINGS will enable the next generation of project analysts.”

Interested readers can join WINGS by donating to the backing campaign, which has collected more than 1,500 bitcoins – more than $1.4 million – so far. WINGS is expected to launch in Q1 2017, and a first DAO project has been pre-announced – Stremio AdEx, a transparent ad network and marketplace running on top  of the Bitcoin blockchain via the RSK side-chain and smart contracts.

 

Published by Bitcoin Magazine. Original article: https://bitcoinmagazine.co…….

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Weekly News Roundup – 25 November 2016

IRS Files Petition in Court to Get Coinbase Users’ Info

On 17th November, the Internal Revenue Service (IRS) filed a petition in the District Court for the Northern District of California asking for permission to serve a summons to the Bitcoin exchange Coinbase to turn over records about every transaction of every user from 2013 to 2015.

According to court records,  the basis of IRS’s claim that all U.S. Coinbase users “may fail or may have failed to comply” with the internal revenue laws is an instance of a tax-defaulting Bitcoin user and two instances of tax-defaulting companies.

 

Bitcoin Price Flirts with Year’s High

Fueled by Indian government’s move to “hard-fork” the Indian Rupee, the Bitcoin price continued to rise since our previous bitcoin news roundup and, on 16 November, it rose by $30 in roughly one hour! On 17 November, it flirted with $780 on Chinese Bitcoin exchanges such as HaoBTC and BTCC.

At time of writing, it was swinging about $730 on Coindesk’s BPI.

Bitcoin Price 11-25 November 2016

Blockchain Partners with Coinify

The Bitcoin wallet Blockchain has partnered with Danish blockchain startup Coinify to offer its wallet users near-instantaneous funding options.  According to Blockchain, this partnership will allow its wallet users to avoid lengthy Know your Customer (KYC) and Anti Money Laundering (AML) verifications to purchase bitcoins more efficiently.

The Coinify integration will first be beta tested by invite-only participants in the UK and, after successful completion of the testing, will be available across Europe.

 

Blockchain Ads Ten Millionth Wallet

Following Blockchain’s previous news, the company announced a new milestone: it surpassed the ten million-wallet mark. The company mentioned that they have seen unprecedented levels of activity following the Brexit vote, the US presidential election and a weakening Yuan.

 

iPayYou Integrates Bitcoin Payment for Amazon Purchases

While major e-retailers like Overstock.com or Newegg.com have long been accepting Bitcoin payments, Amazon has still not adopted the most popular digital currency for payments on its retail platform.  However, early this week, Seattle-based payment platform iPayYou announced a feature called Amazon Direct that allows users to use their Bitcoin to make purchases on Amazon.

According to iPayYou’s CEO, the money is transferred from iPayYou’s bank account to that of Amazon so Amazon only deals with fiat transfers.

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Weekly News Roundup – 11 November 2016

In absence of the previous weekly news roundup, we will be rounding up some noteworthy news of the past two weeks. The past two weeks have been unusually eventful for the bitcoin and cryptocurrency space.

Zcash Launch and Frenzy

The new Bitcoin-derived cryptocurrency Zcash (ZEC) launched amidst much hype  and the frenzy continued after its launch on 28th October, when it surged to a price of  3,300 Bitcoins (more than $2 million). It fell to a value below 1 BTC on 30th October as the frenzy faded, rose temporarily, fell again and remains below 1 BTC at time of writing this.

Zcash / Bitcoin Price

Source: coinmarketcap.com

The company behind Zcash claims that,  in comparison to Bitcoin, Zcash offers more anonymity, increased fungibility and faster transaction verification.

Bitmain Announces World’s Second Most Powerful Data Center

News emerged on a Chinese Bitcoin news’ website on 2nd November that Bitmain is building a giant data center for Bitcoin mining. This was soon followed by Bitmain’s tweets and then a press release that clarified that Bitmain only owns a small share of the 135 megawatt facility and various other investors, who own majority of the facility, can choose to use their share of the data center for any purpose, not only bitcoin mining or mining.

The data center is scheduled to be completed by end of this year. Upon completion, the data center will be second in the list of the world’s most powerful data centers.

BTCC Launches Bitcoin to USD Exchange

Shanghai-based Bitcoin exchange BTCC, formerly known as BTC China, announced on 1st November that they are launching a new USD exchange, one that is operated by a Hong Kong-based legal entity.

BTCC is among the world’s longest running Bitcoin exchanges. By now supporting USD exchange, BTCC can offer tough competition to Hong Kong-based Bitcoin exchange BitFinex, which suffered a major hack and theft of Bitcoins in August.

BTCC’s new service is not yet available to US customers because BTCC is still awaiting approval from FinCEN or New York DFS.

Indian Gov ‘Hardforks’ the Indian Rupee

On 8th November the Indian government announced an overnight demonetization of Rupee notes of the highest (1000 Indian Rupee) and second-highest (500 Indian Rupee) denomination. This move is aimed at stopping counterfeit notes and black money.

In the same announcement, the Indian Prime Minister Narendra Modi informed that new 500 and 2000 Indian Rupee notes will be introduced.

This sudden move by the Indian government to demonetize a considerable portion of the cash that Indian citizens possess is expected to increase awareness and use of cashless payment methods, like Bitcoin, in India.

Bitcoin and Gold Prices Surge after the US Presidential Election Result

The uncertainty in global markets after the shocking win of Donald Trump led to a surge in not only the price of Gold but also that of Bitcoin. The Bitcoin price rose by 3% on Wednesday morning to $726 from $708 the day before.

Prices of other digital currencies (or altcoins) did not make a similar jump. On the contrary, prices of altcoins with the second (Ethereum) and third (Ripple) highest market cap, were down from the day before.

This shows how investors also see Bitcoin as a safe haven at times of market volatility.

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Zcash, the Newly Launched Currency, and How to Get It

Zcash (ZEC), the new digital currency lauded for its privacy features, is launching today amidst some massive hype. But until enough tokens become available on exchanges, Zcash enthusiasts are poised to acquire their ZEC first-hand by mining for it, either by setting up a home rig or by signing up for a cloud mining contract.

Created from a fork of Bitcoin’s codebase, Zcash promises all the best features and stability of Bitcoin with the added bonus of total payment confidentiality. Zcash transactions can be shielded to hide the sender, recipient and value of all transactions on the blockchain. Only those with the correct view key can see the contents.

Another interesting aspect of Zcash is it uses a memory-hard proof-of-work known as Equihash. This means the best hardware for mining Zcash tokens is standard GPUs and RAM. The hope is this will lead to a more decentralized set of miners.

“We think it is unlikely that anyone will be able to build cost-effective custom hardware (ASICs) for mining in the foreseeable future,” Zcash CEO and founder, Zooko Wilcox, and software engineer, Jack Grigg, wrote in a blog post.

Since Zcash did not hold an initial crowdfund, every Zcash token issued will be as a result of mining. And it’s likely that mining, especially in the early days, will be cheaper than purchasing Zcash on an exchange.

Mining for ZEC

There are two ways to mine Zcash: you can build your own GPU rig — arguably, with good mining software, you can use a CPU as well, but more on that later — or you can mine Zcash in the cloud.

Building your own GPU is not easy. When you buy an ASIC for mining bitcoin, you simply connect it to the internet and plug in the power. But GPU mining is a custom setup, where you need to source motherboards and graphic cards.

Because of the work involved, cloud mining make might make sense for some people, though it carries more associated risk. To that end, several cloud GPU providers are open for Zcash business. Genesis Mining is offering a limited number of one-year contracts. Toomim Brothers is offering Zcash cloud mining on three, six and 12 month contracts.

If you are setting up your own CPU or GPU rigs, you will need to find an efficient mining software. Zcash recently held an open source miner challenge, and made all the submissions available to the public.

Slow Start and the Founders Reward

Mining will begin with a “slow start,” which limits the block rewards for the first 20,000 blocks (roughly 34 days). During that time, the block reward will gradually increase from 0 ZEC to 12.5 ZEC.

Typically, when a coin first launches, mining difficulty is at its lowest and rises over a few days or weeks. A slow start discourage the big outfits from dedicating all their resources to mining in the beginning.

“With the ‘slow start’ approach, we can pull the trigger to start mining, knowing that we still have a few weeks before it gets to be significantly valuable, giving us time to watch for failures, work on related operational things (updating our web site, dealing with getting hacked and defaced and all that, collaborating with wallet makers, exchange operators, and other partners, touring the world to visit stadiums of screaming fans, etc.),” Wilcox  wrote on GitHub back in March.

But some in the Zcash forum argue, in the case of Zcash, where there is so much buzz around the coin, major players may jump into the game right away, and the difficulty will soar beyond the reach of the average CPU within hours or days.

TY13R (as he is known on the Zcash Slack channel), who has worked on the Zcash GPU miner, told Bitcoin Magazine:

“When they publish the first block, a huge a amount of hashing power will move over to it. There could be hundreds of blocks mined on the first day.”

Like Bitcoin, the plan is to only produce 21M tokens with a halving every four years, where the reward is halved to control inflation. However, unlike Bitcoin, for the first four years, a full 20 percent of the Zcash mining reward will go to stakeholders in the Zcash Company. This is known as the “Founders Reward.”

Exchanges  and Wallets

If you’re not up for mining, another option is to simply buy Zcash tokens. Coins will be sparse until there is enough in the supply system. But, said TY13R, “If there is money to be made, people will sell. It all depends on whether the miners are willing to give up their ZEC.”

Several exchanges — including Poloniex, Bittrex, HitBTC, and Kraken — have already announced support for Zcash.

Shapeshift has also said that its platform will support ZEC as soon as liquidity allows. Erik Voorhees, CEO of ShapeShift, said to Bitcoin Magazine:

“Just as we should expect privacy in our emails, telephone calls and personal relationships, so too is privacy warranted in financial transactions. In our age of surveillance, the individual deserves every tool of empowerment, and Zcash has the potential to uphold this principle.”

Along with Trezor wallets by SatoshiLabs, Jaxx has revealed it will integrate Zcash a few days after the launch, making Zcash the fifth token Jaxx has added to its lineup in less than three months.

“VCs have invested in Zcash, there’s cutting edge security technology behind it and that’s resulted in quite a lot of chatter in the crypto community,” said Jaxx CEO Anthony Di Iorio. “Zcash holds an extraordinary amount of promise.”

The Case for Zcash

As of this writing, the price of Zcash futures is hovering between 1.2 and 1.4 bitcoin ($820- $950) on BitMEX. If those numbers are any indication, Zcash could well become the second highest valued digital currency on record behind Bitcoin.

Zcash represents the hope for a perfectly untraceable digital currency. Although progress is being made, at this point, Bitcoin transactions are traceable. This lack of fungibility, the idea that one bitcoin may not be as valuable as another, based on how it has been used in the past, has long been a threat to Bitcoin’s livelihood.

“You need fungibility for Bitcoin to function. If you receive coins and can’t spend them, then you start to doubt whether you can spend them,” Blockstream CEO Adam Back told the audience at the Scaling Bitcoin conference in Milan.

The hope is that Zcash finally solves that problem, using the established cryptographic protocol, zk-Snarks. The basic idea is that when you make a transaction, you give a proof that says you have access to a certain amount of funds, but that proof gives zero knowledge to other people about what those funds are. (That is the “zk” part). The “SNARK” part is that Zcash can do this fairly efficiently now, especially compared to ZeroCoin, its precursor.

But Wilcox’s own words capture the aspirations of Zcash the best. In an earlier interview with Bitcoin Magazine, he said:

“The dream is that people all around the world use Zcash and other cryptocurrencies directly, to cooperate and organize with one another in safety and privacy. This will give them freedom from corrupt regimes, banks and unstable national currencies.”

Whether or not Zcash lives up to this dream, only time will tell. As it states on its website, Zcash still considers itself “an experimental technology” and cautions, “there is risk involved.” But for many people who wish they had jumped into Bitcoin earlier, those cautions may go unheard.

 

Written by Amy Castor for Bitcoin Magazine | Original article: https://bitcoinmagazine….

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