Jailed Deepdotweb Admin Denies Earning $15M From Darknet Links

Jailed Deepdotweb Admin Denies Earning $15M From Darknet Links

In an interview from prison, one of Deepdotweb’s operators has disputed the $15 million allegedly made from “illegal” referral links, claiming “There was no such amount.” Currently on remand in France, Israeli citizen Tal Prihar stands accused of directing visitors towards darknet markets (DNMs) in his role as Deepdotweb administrator. The popular site published articles about darknet drug busts, new onion services and other stories related to online marketplaces. The 38-year-old believes he is the victim of a U.S. witch hunt.

Also read: 6 Darknet Markets for the Crypto Curious

Locked Up for Sharing Information

According to the U.S. indictment, Prihar and his business partner referred hundreds of thousands of users to the darknet during Deepdotweb’s tenure, and those users made hundreds of millions of dollars worth of purchases. The indictment refers to goods such as heroin, fentanyl, cocaine, crystal meth, firearms and stolen financial information.

While co-accused Michael Phan, 34, has maintained his silence, Prihar broke cover to dispute the FBI’s assertion that the pair earned $15 million (8,000 BTC) from an affiliate marketing scheme. Contesting a charge of money laundering, Prihar insisted that Deepdotweb (DDW) was merely a news site which helped curious users make more informed decisions about the darknet. Refuting the $15 million figure, Prihar claimed that the site earned money from legitimate marketing endeavors for bitcoin gambling websites, anonymous VPN software, and crypto exchanges.

The interview was conducted in Hebrew via Prihar’s attorney, Nick Kaufman, and the accused made points which will be familiar to anyone who followed the Silk Road case: “We did not create the demand. Neither the guns nor the drugs. So if someone was going to buy a gun and kill people or buy drugs, he would do it regardless of us.”

Feds Seize News Website Deepdotweb as Darknet Crackdown Intensifies

Deepdotweb Operator Pleads His Case

“I don’t know that any specific crime was ever committed just because of something I listed or posted,” ventured Tal Prihar. “On the contrary, our goal was to prevent crimes against personal and economic freedoms and try to minimize bodily and mental harm. There was nothing in our information to convince or coax people into doing something they did not intend to do without us, for better or worse.

“The site was used in general to warn of dangers, poisonings, thefts, and to refer to places we believed to be the least harmful to those who had already decided to use [illicit substances]. We did not recommend and did not push. We never put up an advertised article to promote the use of one or another site, or any other illegal product … I have no doubt that in the absence of [Deepdotweb], many more people would have died from online drug purchases.”

Deepdotweb Duo Indicted for Linking to Darknet Markets
How prosecutors believe the “crime” was perpetrated.

A Unique Case

Prihar stressed that the legal case against the pair is entirely without precedent, asserting that he and Phan are the first ever people to be charged, under anti-money laundering laws, for sharing darknet market referral links. “Their [FBI] interrogations were about the same as an elephant in a china shop,” he claimed. “In general, to this day, I really don’t know that we have committed any offence.”

After seizing Deepdotweb last May, the FBI deleted all of the news articles on the site, with some critics labeling the action an assault on the freedom of the press. At the time of its closure, the site featured hundreds of articles penned by multiple authors.

Prihar is currently housed in an unspecified prison in a Parisian suburb, awaiting extradition to the U.S. Of his current environment, he had this to say: “The rooms are full of blood-sucking insects, and my whole body is covered in bleeding bites. The yards are full of rats and there are many cases of tuberculosis and disease. I experience antisemitism here, lots of loneliness, sadness, concerns and concern for the family.

“When I was arrested, one of the policemen boasted ‘We caught another Jew who took money.’ That is about the recurring motif of the French towards me and all foreigners, like a terrorist. Since I was arrested, no Israeli official has visited me … The stress is unbearable.” Prihar can expect little sympathy from U.S. attorney Scott Brady, who earlier referred to the bust as “the single most significant law enforcement disruption of the darknet to date.”

6 of the Most Popular Darknet Marketplaces That Accept Cryptocurrency

Tal Prihar’s interview was published less than a week after Italian authorities revealed the arrest of three men accused of operating Berlusconi Marketplace. The site ceased operating in October, and the announcement, in which it was revealed that 2.2kg of drugs were seized, had been anticipated. Prosecutors claim that Berlusconi was “the most important market in the Dark Web, both for the quantity of items for sale [and] volume of trades with over 100,000 illegal product announcements.” In reality, Berlusconi didn’t make the top five DNMs, even at its peak. Despite the site’s demise, more than 30 darknet markets remain active.

Do you think Deepdotweb’s operators are being unfairly targeted by U.S. prosecutors? Let us know in the comments section below.


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Becoming Nakamoto: How Satoshi Created His Alter-Ego

Becoming Nakamoto: How Satoshi Created His Alter-Ego

Captain America began life as Steve Rogers. Tony Stark only created Iron Man after being kidnapped. Bruce Wayne spent seven years in ninja training before eventually returning to Gotham as Batman. We don’t know Satoshi Nakamoto’s birth name, but we do know something about the steps he took to create Bitcoin and indelibly forge his alter-ego.

Also read: Satoshi’s Final Messages Leave Tantalizing Clues to His Disappearance

Unmasking the Legend of Satoshi

We don’t know who Satoshi is or was, but like the superheroes of today’s Marvel and DC movies, beneath the mask was a flawed human capable of extraordinary things. Deifying – or rather superhero-ifying – any one man is the antithesis of everything Bitcoin stands for. Indeed, it may have been the growing cult of Satoshi that sent Bitcoin’s creator scurrying into exile. For evocative purposes, however, the superhero metaphor works. Just think about it:

One man, taking on a corrupt system (central banking). The assumption of a pseudonym to protect his identity. The need to separate his personal and professional life (there could be no Tony Stark reveal of his Iron Man alter-ego). The need to operate as a lone wolf for years with no assistance or remuneration. Constant threats to his mission and his freedom from enemies determined to see him fail. Satoshi didn’t wear a cape, but when his movie is made, it belongs in the superhero genre.

Becoming Nakamoto: How Satoshi Created His Alter-Ego
Steve Rogers prepares to be transformed into Captain America

2007: Humble Beginnings

“I actually did this kind of backwards,” confessed Satoshi in an email to Hal Finney. “I had to write all the code before I could convince myself that I could solve every problem, then I wrote the paper.” It’s likely that Nakamoto began work on Bitcoin before he had conceived his pseudonymous character. “The design and coding started in 2007,” he explained, likely occurring towards the start of the year. It wasn’t known as Bitcoin at that point, assuming the working title of “Electronic Cash Without a Trusted Third Party.”

By the end of 2007, we can deduce that Satoshi had conceived the basics of what would become Bitcoin: a means of sending electronic payments “from one party to another without the burdens of going through a financial institution.” To achieve this, Satoshi had made a major breakthrough in solving the double-spend problem by postulating a chain of hash-based proof-of-work. This would form a timestamped record that could not be changed without redoing the proof-of-work. It was, he would later explain, “a solution to the Byzantine Generals’ Problem.”

Satoshi’s eureka moment may have arrived in 2007, but Bitcoin was still little more than a concept. It consisted of a few thousand lines of incomplete code and was lacking the ingredients that would make for a decentralized currency: working software, a coin issuance schedule, block times, and most of the other components that would prove integral to Bitcoin as we know it. If Satoshi had thought the late nights and endless redrafting sessions of 2007 were exhausting, they were nothing compared to what the following year would throw his way.

Becoming Nakamoto: How Satoshi Created His Alter-Ego

2008: First Contact

As 2008 ground into gear, Satoshi found his to-do list getting longer by the day. Up until now, he’d been focused on the mechanics of his electronic cash system, and would spend the first half of 2008 codifying his ideas into what would become the Bitcoin whitepaper. But he also had other pressing concerns: soon Satoshi knew he would have to break cover and go public. At the same time, he would have to conceal his tracks. The year prior, the founders of Liberty Reserve had been sentenced to five years in jail for operating its forerunner, digital currency exchange Gold Age, without a financial license.

Satoshi knew he would have to create a robust pseudonym that could not be linked to his real identity. But he was also shrewd enough to recognize the need for a moniker with a certain mystique to it. Even in the unmarketable underworld of cryptography mailing lists, a memorable name will stick. Where he plucked it from, we will never know. What we do know is that Satoshi Nakamoto has a pleasing ring to it. Once Satoshi had settled on his superhero alter-ego, there could be no going back.

By the time Satoshi had chosen his name, he had also settled on a name for his electronic cash system: Bitcoin. On August 18, 2008, he registered the domain bitcoin.org via anonymousspeech.com. Four days later, Satoshi made his first known contact with the world, emailing Wei Dai from satoshi@anonymousspeech.com, and including a link to an early release of the Bitcoin whitepaper. It is believed that Satoshi may have emailed Adam Back prior to this; if so, the event probably occurred earlier that August.

Becoming Nakamoto: How Satoshi Created His Alter-Ego
Bruce Wayne undergoes training in Batman Begins

Fall 2008: Bitcoin Begins

Satoshi’s earliest interactions with the cryptography community have all the hallmarks of a fledgling superhero still getting accustomed to their newfound powers. He was modest and disarmingly humble, especially so in these initial exchanges, when no one knew who Satoshi was and had no reason to care. Through late 2008 and into January 2009, his comms were unfailingly polite: “Sorry if I didn’t make that clear” and “I’d appreciate it. Thanks, Satoshi.”

Even at this stage, when there was every chance that Bitcoin would not catch on, it was evident that Satoshi had thought everything out – from his entry right through to his exit strategy. In addition to going to great lengths to anonymously register bitcoin.org and conduct all of his business from behind a proxy or seven, Satoshi appears to have begun changing his spelling to put further distance between his persona and his pseudonym. Satoshi’s writing style will be the subject of a future analysis by news.Bitcoin.com. For now, it is worth noting that his well-documented British spelling is an idiosyncrasy Satoshi appears to have acquired in 2008, with mixed results at first as he got into character.

Becoming Nakamoto: How Satoshi Created His Alter-Ego

On October 31, 2008, Satoshi published his whitepaper to the cryptography mailing list, explaining “I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party.” Even at this stage, there was much about Bitcoin that was still undecided or unrevealed, including the 21 million supply, which appears to have been finalized shortly before Satoshi shared v0.1 of Bitcoin’s code on January 9, 2009.

It’s easy to assign inevitability to the rise of Bitcoin, using the gift of hindsight. The reality, though, is that in its nascent months, Bitcoin’s survival chances were probably no greater than 50-50, and even optimists would have tipped it to be adopted by a few thousand believers at best. As Mike Hearn was to later recall, “At the time bitcoins had no value at all and nobody else was using the system … It was just an interesting science project on SourceForge, one of many, which seemed destined to sink into obscurity.”

Satoshi’s genius lies not only in his ability to solve the double-spend problem, or to eliminate trusted third parties. He painfully created an undoxxable persona that has, as far as we know, withstood unmasking attempts from armchair sleuths and three-letter agencies alike. Satoshi is more than a spur-of-the-moment epithet coined by a man who wanted to preserve his privacy: like a pre-fame superhero, his character was born in the darkness, forged in steel and years in the making.

Do you think Satoshi will ever be found? Let us know in the comments section below.


Images courtesy of Shutterstock, Marvel, and Warner Brothers.

With thanks to Jamie Redman and Katie Webster for their input with this article.


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For Initial Exchange Offerings, Liquidity is King

For Initial Exchange Offerings, Liquidity is King

There are many benchmarks for measuring IEO success. Token price, community size, code shipped, and milestones met are all yardsticks for gauging the progress of a tokenized project. For projects seeking to create the biggest possible splash, however, liquidity is the crucial factor. The more exchanges an IEO reaches, the greater its prospects of survival.

Also read: How Crypto Winters of Bitcoin’s Past Compare to Today

Multiple Exchanges Multiply Projects’ Prospects

Initial exchange offerings are big business: according to Inwara, IEO projects raised a cool $1.625 billion in the first half of 2019. H2 has continued that trend, with the leading exchange launchpads maintaining their aggressive IEO schedule – one a month in the case of Binance; 24/7 in the case of smaller platforms such as Latoken. Investor demand for initial exchange offerings also remains robust: the leading crypto Telegram channels, maintained by the likes of Coinidol, attest to this, as investors clamor to catch wind of pre-sale and seed rounds for projects that will eventually IEO on Binance or Huobi.

While the initial exchange offering brings benefits to investors and project teams, compared to the ICO, it is hamstrung by a flaw that is inherent to this fundraising model: often, there is little incentive for other exchanges to list the token. As a result, most IEOs will live and die on the exchange that hosted their token sale. For the handful of IEOs that have thrived post-sale, both in terms of token price and other benchmarks, it’s no coincidence that they’ve transcended their issuing platform, and gained deep liquidity in the process.

For Initial Exchange Offerings, Liquidity is King

Bittorrent Remains the Liquid Leader

The most liquid token IEO to date, based on the number of exchanges where it’s listed, is also one of the earliest: Bittorrent (BTT), which launched on Binance last year. Today it appears on 34 exchanges – 24 more than the next most-listed tokens. It’s no coincidence that tokens listed on the most exchanges – namely BTT (34), MATIC (10) and SERO (10) – outperform all others as far as ROI and ATH ROI are concerned. The correlation between number of exchanges and project performance is inarguable.

For Initial Exchange Offerings, Liquidity is King

For better or worse, IEOs have taken the crypto world by storm, but most projects will never see the sort of liquidity enjoyed by Bittorrent and Matic. In fact, of the 65 IEOs launched in the past six months, the vast majority have failed to even make it onto a second exchange. The consequence of this has been limited liquidity, low accessibility/visibility and, in many cases, a project which has effectively died before it has even gotten the opportunity to develop any serious momentum.

A final note on IEO liquidity: when it comes to securing multiple exchange listings, quality beats quantity every time. According to Cryptorank.io, Binance leads the way, with a much higher average ROI for its listed tokens (94.53%). Bittorrent’s runaway success played a part in this: it was the first IEO on Binance Launchpad, meeting its funding goal of $7.2 million in mere minutes. Every project since has struggled in vain to emulate that success.

Do you think IEOs have peaked, or are they just getting started? Let us know in the comments section below.


Images courtesy of Shutterstock and Cryptodiffer.


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Crypto Tax Guidelines Leave More Questions Than Answers

Crypto Tax Guidelines Leave More Questions Than Answers

Cryptocurrency holders have long wrestled with their tax obligations. These fiduciary duties have been complicated by tax agencies, which are several steps behind technology and now playing crypto catch-up. Updated guidelines from the U.S. and U.K.’s tax agencies were finally released this year, but the initial relief felt by conscientious bitcoiners was to prove short-lived, for on closer examination, the documentation has left many crypto questions unanswered.

Also read: Crypto-Friendly Silvergate Bank IPO Debuts on NYSE

It’s 2019 and Tax Is Still Taxing

The lack of uniformity regarding tax on crypto earnings, with some national governments happy to kick the can down the road and others determined to immediately collect their pound of flesh is frustrating, to put it mildly. The latest guidelines from Her Majesty’s Revenue and Customs (HMRC) for U.K. residents has succeeded in muddying the already-feculent waters.

Once again, a tax authority’s attempt to provide clarity on crypto taxation has become, instead, a wellspring of uncertain questions. It was the same when the IRS published crypto tax guidance in 2014, and again in October of this year. So, why are such powerful arms of the state unable to lay down clearly-defined tax principles on virtual currency? Is it because the powers-that-be do not fully comprehend this rapidly-evolving environment or its underlying technology? Or is it the case that the nature of forks, airdrops and token sales is incompatible with hard-and-fast taxation rules?

Robin Singh is the founder of crypto tax platform Koinly. “Part of the problem,” he explains, “is that regulators do not understand cryptocurrencies. In the latest IRS guidelines, for example, the IRS refers to forked coins as “airdrops after a fork”. They are oblivious to the fact that there is no actual airdrop – the ledger is simply copied. This misinterpretation has given rise to the issue investors now face: paying income tax on forked coins they may have no intentions of using.”

Exchange Tokens ‘Aren’t Currency’

HMRC’s recent update to its guidance on crypto taxes, published on November 1, dealt with crypto transactions carried out by companies, businesses such as partnerships and sole traders, and individuals. In essence, it sought to end confusion about the extent to which cryptocurrency transactions occasion capital gains tax, national insurance contributions, corporation tax, VAT, and income tax.

The main plank of HMRC’s argument is that, generally speaking, “exchange tokens” are not currencies, stock or marketable securities – meaning they are exempt from stamp taxes. Nevertheless, tokens used in debt transactions do incur stamp taxes.

Bitcoin is explicitly mentioned in the policy paper as an example of an exchange token, with security and utility tokens to be dealt with in a future update. Despite the policy paper being entitled “Tax on cryptoassets,” therefore, it is far from comprehensive. And, to quote an instructive line, “The tax policy may evolve as the sector develops.”

Crypto Tax Obligations for Individuals

As it has previously, HMRC was keen to point out that “the tax treatment of all types of tokens is dependent on the nature and use of the token and not the definition of the token.” In other words, it’s up to you whether you incur any tax at all.

If you sell exchange tokens that have appreciated in value, they will – as investments – be liable to capital gains tax; income tax and national insurance contributions are also due on crypto assets received from employers as a form of non-cash payment and from mining operations or airdrops.

In instances where individuals essentially act as a business by frequently transacting financial trades involving crypto assets, their taxable trading profits are subject to income tax rather than capital gains tax. Of course, you can reduce your tax liability by offsetting losses against future profits; the cost of the asset itself can be a deduction.

A Thankless Task for Tax Agencies

Because assets such as bitcoin are traded on exchanges which do not use pounds sterling, HMRC’s guidance notes that the value of any gain or loss must be converted to sterling on an individual’s self assessment tax return. The guidance points out that individuals must keep separate records of each crypto asset transaction including type of asset; date of transaction; if they were bought or sold; number of units and value of transaction in sterling; cumulative total of the investment units held; and bank statements and wallet addresses.

Of course, it is easy to pick holes in the guidance. The tax body says that reasonable care should be taken to make “appropriate valuations” for transactions using a consistent methodology. However, it fails to elaborate on what would be appropriate, and which methodology would be permissible. The HMRC also betrays its own ignorance when discussing matters of fraud in the cryptosphere, noting that theft is not considered disposal “as the individual still owns the assets and has a right to recover them.” They may have a right to recover them, but they probably have no prospect of doing so. Victims of theft cannot claim a loss in capital gains tax either.

Crypto Tax Obligations for Businesses

HMRC’s guidance for businesses is, as you might expect, even more complex and confusing than for individuals. Crypto mining companies are subject to tax based on factors including degree and frequency of activity, level of organization, risk and commerciality. But most business activities in the cryptosphere are subject to some form of tax, whether the activity is buying and selling tokens, exchanging tokens for other assets (including other forms of cryptocurrency) and supplying goods and services in return for tokens, the latter of which entails VAT on the “pound sterling value of the exchange tokens at the point the transaction takes place.”

Confusion stems from qualifiers such as “the type of tax will depend on who is involved in the business,” although the process by which accounts should be prepared is, at least, unambiguous: they should follow generally accepted accounting practice (GAAP) or, if relevant, international accounting standards (IAS).

If a business’s activities constitute a trade, receipts and expenses form part of the calculation of the resulting profit. If a partnership conducts the trade, partners will be taxed on their share of the trading profit. And if the activity concerning the exchange token is not deemed “trading activity,” the gain obtained from eventually disposing of a crypto asset will be charged to corporation tax.

Where Do We Go From Here?

The fact that the status of security and utility tokens remains unaddressed indicates that HMRC is continuing to wrestle with fundamental questions about tax on crypto. While these latest directives do answer some long-held queries pertaining to “exchange tokens,” they also throw up others. Is HMRC open to eventually changing their stance that cryptocurrency is not money, for instance? This one will be asked ad infinitum, particularly as merchant adoption increases. For bitcoiners in the U.K., U.S., and other leading crypto countries, divining the intent of the tax agencies has become a dark art.

Do you think tax agencies are at fault for complicating crypto tax guidance, or are they just struggling to keep pace with a rapidly evolving industry? Let us know in the comments section below.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

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Congressional Hopeful Agatha Bacelar Talks Silk Road on the Bitcoin.com Podcast 

Congressional Hopeful Agatha Bacelar Talks Silk Road on the Bitcoin.com Podcast 

“It’s clear that the political establishment wants to hold back a future where economic freedom is afforded to all.” This excerpt from Congressional hopeful Agatha Bacelar’s campaign donation page echoes what many within the cryptosphere have been saying ever since Satoshi Nakamoto dropped the Bitcoin whitepaper in 2008 – and what many libertarians have been trumpeting for decades.

Also read: FBI Says Bitcoin Concern Is Getting ‘Bigger and Bigger’

Bacelar Lays the Smackdown

The fact that Bacelar, who has set her eyes on House Speaker Nancy Pelosi’s seat in the California Congress, seeks to raise $1 million in crypto is significant. Stanford-educated and an engineer by trade, the 27-year-old Brazilian-American understands blockchain technology like few politicos before her, having worked with digital governance platform Democracy Earth. This nonprofit seeks to change the political system by building open-source, censorship-proof democracies, and grew out of what Bacelar describes as a “trojan horse” political party in Argentina. Uniquely, the party used blockchain tech to field candidates who were not so much representatives of the people as, well, the people themselves.

Congressional Hopeful Agatha Bacelar Talks Silk Road on the Bitcoin.com Podcast

Bacelar was recently invited on to the Bitcoin.com podcast and, needless to say, the topic of cryptocurrency came up more than once. “I can see why it’s very scary to introduce cryptocurrency to central banks because it kicks them in the knees,” she said. “But I think for a healthier world we need more public banking, public financing of things rather than having the power consolidated through central banks.”

As for the day-to-day benefits of using cryptocurrency, they are self-evident: “Whenever I want to pay my rent it takes a week for my money to transfer to my landlord’s bank account. We could be having faster global currency that doesn’t take 10% for a middleman.”

New Hire to Head Digital Currency Research at the Fed

Audit the Fed

Many listeners would have been keen to hear the candidate’s thoughts on how distributed ledger technologies could be used to revamp the entire system. Host Matt Aaron beat his guest to the punch, suggesting that publicly auditing the Federal Reserve might be a good place to start. “Yeah, that would,” Bacelar concurred. “Doing more participatory budgeting, letting people have a greater say on how we use our tax dollars.”

“Right now, we lose information every time a transaction happens. Whereas, I would hope with cryptocurrencies, if you buy an iPhone, you would know whether this phone was made at a factory where three people committed suicide, or whether the resources were mined in a place that used human slavery or contributed to pollution in that bio-region.

“You know, those things are not reflected in the cost of things today, but I think in a future world they could be. And that could lead us to a more regenerative, sustainable economy.”

Not Your Average Congressional Candidate

The backstory of Agatha Bacelar is a little different to most would-be politicians – just 3% of House Representatives currently come from a STEM background, for starters. As well as her experience with blockchain, she’s worked for social change organization Emerson Collective and Hope Credit Union, a banking institution that provides financial services to low-income applicants. Bacelar’s father is Herb Stephens, a software entrepreneur who, having worked in the nonprofit sector for a number of years, now acts as her Finance Director.

Trump rode to the White House on a hubristic ticket, with an oft-repeated boast that – unlike the other candidates – he “knew money.” Perhaps Bacelar could also profit from knowing the future of money – cryptocurrency – and having an awareness about how the underlying technology could inform the body politic. “I would like to be a member of Congress that makes decisions informed by how people would vote on an open-source digital platform in real time,” she says, “because right now there isn’t accountability in our politics. There isn’t transparency, and people are writing off politics and or feeling so frustrated with it. But I think people can represent themselves or proxy their vote to people they trust and know in their community.”

The Injustice of the Silk Road Trial

At one stage in the discussion, Bacelar segues from addressing the absurdity of criminalizing drugs like marijuana to discussing Silk Road. “Ross Ulbricht is incarcerated right now for two life sentences plus 30 years for nonviolent crime, where he didn’t even do any of the drug transactions on there.”

As an enthusiastic pro-crypto voice, Agatha Bacelar is a breath of fresh air. Whether she has a realistic chance of turfing out Pelosi remains to be seen. Whatever the outcome, you get the sense that Bacelar recognizes the ability of cryptocurrencies – and blockchain technology more generally – to fundamentally reshape society. For public ledgers to introduce greater accountability in corporations and government agencies. For sound access to finance to be available to all. For profit-offshoring, money laundering and tax evasion to be effectively addressed.

The final word goes to Bacelar: “We need to decentralize power and get people to participate in our democracy. A democracy is strongest when most people engage in it.”

What are your thoughts on Agatha Bacelar’s take on Silk Road and the benefits of bitcoin? Let us know in the comments section below.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

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Bitcoin History Part 19: Wikileaks and the Hornet’s Nest

Bitcoin History Part 19: WikiLeaks and the Hornet’s Nest

“WikiLeaks has kicked the hornet’s nest, and the swarm is headed towards us.” With those 13 words, Satoshi Nakamoto stepped into oblivion, leaving a blizzard of unanswered questions that would enshroud his disappearance. That ominous message was to prove his penultimate forum post, dispatched a day before his final entry. What happened to put Wikileaks in the crosshairs of Bitcoin’s creator?

Also read: Bitcoin History Part 18: The First Bitcoin Wallet

Wikileaks Shines a Light on Bitcoin

Satoshi’s words were freighted with such a sense of foreboding that many believe they signified the writing on the wall; a sign that Nakamoto’s tenure as Bitcoin figurehead had reached its inevitable end. His remark that Wikileaks had “kicked the hornet’s nest” referred to the possibility of the controversial whistleblower website turning to bitcoin, after the U.S. government forced companies like Visa, Mastercard and Paypal to blockade the organization. According to an earlier post by Satoshi, the bitcoin project needed “to grow gradually so the software can be strengthened along the way,” and the association with Wikileaks came too early in its development.

As a disoriented Julian Assange attempts to fight extradition to the U.S. in the British courts, having earlier claimed to have made a 50,000% return on bitcoin in the years following Satoshi’s disappearance, it’s interesting to look back to that period – December, 2010 – when Satoshi’s retreat began and Wikileaks’ investment in bitcoin started being seriously discussed. This was a true fork in the road, significant not only to the history of bitcoin but also to state surveillance and those who would kick back at it.

Bitcoin History Part 19: WikiLeaks and the Hornet’s Nest

The Man Who Kicked the Hornet’s Nest

You might wonder why Bitcoin’s founder was so alarmed by the news that Wikileaks was seeking to raise funds using the decentralized payment system. After all, bitcoin was designed to bypass gatekeepers and obviate the need for a central authority – and here was a perfect use case to prove its merits.

In response to a forum member positively touting Wikileaks’ embracement of bitcoin, published exactly one week before his final forum post, Satoshi said: “No, don’t “bring it on”… Bitcoin is a small beta community in its infancy. You would not stand to get more than pocket change, and the heat you would bring would likely destroy us at this stage.”

The problem was very clear, as Satoshi saw it: unwanted government interest in the nascent digital currency was the last thing it needed at that point in time. And since just about every other payment gateway was refusing to process donations to Wikileaks, Julian Assange’s solicitation of donations via bitcoin seemed to be a matter of time. At the very least, Satoshi wanted such a move to be discouraged – and he conveyed as much to Assange, as recounted by the latter in a 2014 Reddit Ask Me Anything (AMA) session and also in his book “When Google Met WikiLeaks”:

WikiLeaks read and agreed with Satoshi’s analysis, and decided to put off the launch of a Bitcoin donation channel until the currency had become more established. WikiLeaks’ Bitcoin donation address was launched after the currency’s first major boom, on June 14, 2011.

Interestingly, the besieged organization opened the floodgates for bitcoin donations just two months after Satoshi’s last ever correspondence – an email to collaborator Gavin Andresen.

Bitcoin History Part 19: WikiLeaks and the Hornet’s Nest

The rest, as they say, is history: Wikileaks received tens of millions of dollars in bitcoin donations between 2011 and 2018 (the exact figure continues to be disputed), Assange spent years in London’s Ecuadorian embassy before being arrested, and in Satoshi’s absence, Bitcoin was to kick many more hornets’ nests only to emerge, each time, stronger.

Bitcoin History is a multipart series from news.Bitcoin.com charting pivotal moments in the evolution of the world’s first and finest cryptocurrency. Read part 18 here.


Images courtesy of Shutterstock.


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Conceal and Reveal: The Evolution of Privacy Coin Technology

Conceal and Reveal: The Evolution of Privacy Coin Technology

Privacy can assume many forms and occur on many levels. The technologies that blockchain architects originally envisioned for privacy coins are now being utilized by an array of crypto stakeholders, from enterprises to exchanges. What began as a means of transacting anonymously has spawned a burgeoning industry, built upon technologies designed to conceal, but which can also be programmed to reveal to a select few.

Also read: Chinese Communist Party Reportedly Filling Roles at Top Exchange Huobi

zk-Snarks

zk-Snarks are best known for their use in privacy coin protocols such as Zcash. These “zero knowledge proofs” have far broader applications than simply masking the sender and receiver when transmitting crypto via a public ledger. A zero-knowledge proof allows one party to prove to another that a statement is true, without revealing any information about the statement itself.

To break this down into a simple analogy, imagine that Farmer Bob is selling some livestock at the market. He wishes to prove to the auctioneer that there is a cow in his trailer, but without opening the door (cos then the creature would escape). Using a heat sensor installed inside the trailer, Bob can prove that there is a living, breathing animal inside, but the auctioneer will have no way of knowing which cow it is, or even whether the animal is a cow (unless it moos and gives the game away). That, essentially, is how a zk-Snark operates: proof that something is true, while disclosing zero knowledge about the thing in question.

As for how zk-Snarks can be deployed outside of privacy coin transactions, look no further than smart contracts. Quras, for example, is using the technology to provision privacy-enabled smart contracts that run on its eponymous VM. Applications include concealing information pertaining to credit history; enabling healthcare and medical information from IoT devices to be shared confidentially; and facilitating sealed auctions that are executed using smart contracts.

Conceal and Reveal: The Evolution of Privacy Coin Technology

Mouayad Yousef is the COO of Burency, a cryptocurrency exchange and blockchain research and development platform. Expounding on why private smart contracts are desirable, he told news.Bitcoin.com: “Smart contracts have the potential to automate business processes ranging from calculating insurance premiums to powering decentralized synthetics markets, but for this to happen, there needs to be privacy built in. Broadcasting information on-chain nullifies any benefits that might otherwise have been gained through using blockchain, since publicly verifiable smart contracts enable observers to frontrun markets and steal competitors’ proprietary algorithms. Privacy technology provides a means to conceal the secret sauce that’s in a smart contract, while still enabling its integrity to be verified.”

Conceal and Reveal: The Evolution of Privacy Coin Technology

Mimblewimble

zk-Snarks aren’t the only privacy technology whose applications extend far beyond those originally envisioned by its pseudonymous creator. The origins of Mimblewimble don’t need retelling again, but its evolution does. Although utilized by both Grin and Beam – and soon Litecoin too – it is the Beam iteration of Mimblewimble that has applications for the broadest range of users. Understanding how Mimblewimble works isn’t easy, unless you’re au fait with elliptic curve cryptography. Even Beam’s attempt at explaining the process via a series of dumbed down metaphors takes some digesting.

What’s relevant here isn’t so much the way in which Mimblewimble works, but the fact that it can provide complete transactional anonymity between parties while being compatible with implementations such as Beam that enable optional audibility. Digitally signed documentation can be attached to transactions, giving an approved auditor permission to view the transactions associated with a particular key. For cypherpunks intent on concealing their activity from snooping governments, that ability will be of little interest, but for businesses that wish to conceal their day-to-day affairs from the public (paying staff, contractors, and purchasing goods) while still remaining compliant from an accounting perspective, it’s extremely useful.

Conceal and Reveal: The Evolution of Privacy Coin Technology

Bulletproofs

Bulletproofs are actually part of the zero-knowledge proofs family and allow multiple range proofs from different parties to be aggregated into one proof. What this means, in practice, is that bulletproofs allow for information to be significantly compressed without compromising its validity. When integrated into Monero last year, for example, bulletproofs slashed transaction fees through reducing the average size of each transaction.

There is a number of interesting applications for bulletproofs outside of facilitating confidential transactions. They can be used in proof of solvency, for instance, with one research paper noting: “A Bitcoin exchange with 2 million customers needs approximately 18GB to prove solvency in a confidential manner … Using Bulletproofs and its variant protocols … this size could be reduced to approximately 62MB.” The same paper lists a total of eight use cases for bulletproofs, including smart contracts and crypto derivatives.

Privacy coin tech follows the same adoption curve as other disruptive technologies: first it’s used by criminals, outlaws, and geeks. Then by enterprises, ordinary end users and even governments. Just as it was with encryption, so it is proving to be with privacy-preserving tech: from unknown to ostracized to indispensable in under a decade.

What other privacy technologies have broad applications beyond simply enabling anonymous transactions? Let us know in the comments section below.


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Critics Savage Research Paper Alleging Lone Whale Caused Bitcoin’s 2017 Rally

Critics Savage Research Paper Alleging Lone Whale Caused Bitcoin’s 2017 Rally

Crypto commenters have torn into a new research paper alleging a single whale caused bitcoin’s 2017 price rally. The paper, reported prominently in Bloomberg and the Wall Street Journal, has been criticized for failing to understand that mass inflows of tether (USDT) to the cryptoconomy are not indicative of a single source accounting for all the buy pressure.

Also read: Bad Loans at Big British Banks Jump Over 50% in a Year

The Legendary Lone Whale

The final draft of the research paper that’s had Tether’s lawyers seething for weeks has finally been published. Its conclusion – that a ‘lone whale’ was single-handedly responsible for propelling bitcoin to $20k – has not changed, but the findings have been bolstered by the addition of peer review. Crypto commenters are not impressed, though, and have dismissed the paper as flawed.

Critics Savage Research Paper Alleging Lone Whale Caused Bitcoin’s 2017 Rally

According to the updated paper from University of Texas Professor John Griffin and Ohio State University’s Amin Shams, first published in 2018, BTC buys on Bitfinex increased whenever bitcoin’s value fell by certain increments. “This pattern is only present in periods following printing of Tether, driven by a single large account holder, and not observed by other exchanges,” concludes the latest iteration of the paper, due for publication in the Journal of Finance. It adds:

Simulations show that these patterns are highly unlikely to be due to chance. This one large player or entity either exhibited clairvoyant market timing or exerted an extremely large price impact on Bitcoin that is not observed in aggregate flows from other smaller traders.

Tether’s General Counsel Stuart Hoegner countered that the paper was “foundationally flawed” and probably published to back a “parasitic lawsuit.” He continued: “This is a transparent attempt to use the semblance of academia for a mercenary money grab.”

Correlation Does Not Equal Causation

Within the cryptosphere, observers were almost unanimous in condemning the research paper. “The venn diagram of people who don’t believe in markets but rather see conspiracies and manipulation everywhere has a perfect overlap with people who are not active in those markets,” tweeted Nic Carter. “It’s exclusively the purview of outsiders to claim the markets are somehow false. Umbrellas cause rain, finds Texas academic.”

Circle CEO Jeremy Allair labeled the WSJ’s story on the matter “extremely weak reporting” and explained that “in 2017/2018 there was demand for buying BTC and a massive alt coin rally. The majority of that demand came from Asia and China, and since there were no CNY ramps into BTC, everyone went to offshore USDT processors. These processors would then generate large prints of USDT. The only thing this supposed analysis shows is that Asia traders demanded fiat to buy BTC.”

Ari Paul echoed Allair’s sentiment, tweeting “Their “research” is based on an elementary misunderstanding of how financial assets work.” Director of research at DAR Lucas Nuzzo wondered “What if the authors misunderstood that large USDT addresses are often highly syndicated, and what appears to be a “single whale” are thousands of different depositors?”

What are your thoughts on the findings of the research paper? Let us know in the comments section below.


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Cryptosteel Capsule Will Keep Your Wallet Seed Safe and Out of Sight

The Cryptosteel Capsule Will Keep Your Wallet Seed Safe and Out of Sight

A hollow steel cylinder despatched with 800 lettered tiles, the Cryptosteel Capsule is what it sounds like and nothing more. Assemble the letters to form your wallet’s seed phrase, thread them onto the metal dipstick and screw the capsule shut, safely entombing the key to your crown jewels inside an unassuming piece of hardware. Stash it in a toolbox alongside some masonry and no one would be the wiser.

Also read: Billion Dollar Bitcoin Lawsuit Continues as Craig Wright Breaks Settlement

The Re-Gadgetification of Things

80s kids mourning the loss of the gadget-based society they were raised in are naturally drawn to crypto cold storage. For every device (portable radio; spirit level; tape measure) that was subsumed into the iPhone, there’s another that hardware wallet (HW) manufacturers have seen fit to develop and isolate from the smartphone in the name of opsec.

There is a logic in wanting to keep your hot assets – i.e anything connected to the web – separate from your cold – typically those you cherish the most and have no intention of liquidating in a hurry. That said, it’s sometimes hard to tell how much of these aftermarket HW accessories are actually helping, and how much of it is just cold storage theater.

That there are benefits to keeping your crypto assets safely stashed where hackers, phishers, and SIM-swappers can’t operate is clear. What’s less evident is whether entombing your hardware wallet in a hermetically sealed vault kept at absolute zero with a pack of rottweilers guarding it and anti-tank guns watching the skies is absolutely necessary. Until we see empirical studies on the success rates of extreme opsec compared with, say, scrawling your seed phrase on a scrap of paper and stashing it in a drawer, it’s really hard to say.

Cryptosteel Capsule Will Keep Your Wallet Seed Safe and Out of Sight
The Cryptosteel Capsule comes with 800 character tiles

The Mother of All Backups

Delivered in a smart tray that evokes a luxury chocolate box, the Cryptosteel is described as “the mother of all backups.” Not the daddy, not the son, and certainly not the creepy half-cousin: the ‘steel is all momma. The device, available singly or in packs of up to five, is described as being “compatible with most secret sharing and key generation algorithms.” By that, its manufacturers mean there’s enough numbers and letters in the box to cover most 12-word seed permutations. You can cram 123 characters onto the stick before it’s maxed out.

Unfortunately, the stick isn’t quite accommodating enough for a 24-word seed: in testing, I managed 21 words before running out of space. Given that the capsules retail for $100, it seems a little excessive to require multiple capsules to store a single seed. That said, 12 words should suffice for most wallet seeds, and you might even fit on 24 words if they happen to be short and you remove the word separators that are meant to be inserted.

Cryptosteel Capsule Will Keep Your Wallet Seed Safe and Out of Sight
My capsule with 21 of 24 seed words squeezed on.

Better Than a Steel Punch in the Face

I like the Cryptosteel Capsule, despite its limitations. It’s not as alpha as using a steel punch, but it’s a lot easier to create your wallet seed with, and feels almost as permanent. Just be careful when the time comes to unthread it, as one slip and your painstakingly assembled seed will be alphabet soup. It’s hard to say whether sitting in bed threading steel beads onto a metal stick is the financial sovereignty Satoshi dreamed of, or simply a regression to making macaroni art in kindergarten, but it sure is fun. More importantly, it’s a secure way of recording your seed provided you can keep the innocuous looking capsule in a safe place away from prying eyes.

Cryptosteel Capsule Will Keep Your Wallet Seed Safe and Out of Sight

What are your thoughts on cold storage capsules – do you think they can help enhance offline security? Let us know in the comments section below.

Disclaimer: Bitcoin.com does not endorse or support claims made by any parties in this article. None of the information in this article is intended as investment advice, as an offer or solicitation of an offer to buy or sell, or as a recommendation, endorsement, or sponsorship of any products, services, or companies. Neither Bitcoin.com nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


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Crypto Traders Rush to Revamp Their Security After Bitmex Dox

Crypto Traders Rush to Revamp Their Security After Bitmex Dox

The world’s largest crypto derivatives exchange Bitmex has accidentally doxed tens of thousands of its users. An email newsletter concerning forthcoming updates to Bitmex indices CC’d a large proportion of the company’s mailing list, exposing the addresses of its users to the public. In a second embarrassment, Bitmex had its Twitter account hacked shortly afterward.

Also read: ECB President: ’We Should Be Happier to Have a Job Than to Have Our Savings Protected’

Bitmex Suffers a Day of Reckoning

Bitmex users are being urged to change their details, with hackers and phishers certain to try and crack the leaked email addresses, many of which are likely to be tied to accounts on different crypto exchanges.

Exchanges such as Binance have already advised their users to modify email addresses if they were also linked to Bitmex. The blunder is a stark reminder to traders to use a unique email address and password for each platform, utilizing a password manager if needed.

The PR disaster was compounded when Bitmex’s official Twitter handle was briefly compromised, with tweets reading “Hacked” and “Take your BTC and run. Last day for withdrawals.”

Crypto Traders Rush to Revamp Their Security After Bitmex Dox

In a statement, Bitmex cited a software error as the cause of the email breach, and stressed that, beyond email addresses, “no other personal data or account information have been disclosed and no further emails have been sent.” The statement also urged users to add official Bitmex email addresses to their contact lists and ensure Two-Factor Authentication (2FA) for all their accounts.

Tens of Thousands of Addresses Exposed

Bitmex deputy COO Vivien Khoo said that while the email was sent to the majority of Bitmex users, not all were affected. According to skew.com, the exchange – which operates out of Seychelles – has 22,000 average daily users. Larry Cermak said on Twitter that “30,000 unique emails in total” were jeopardized.

In the aftermath of the leak, Twitter was aflame with panicked users, some enquiring how to delete their Bitmex account and others claiming to have already received crypto spam emails in the wake of the leak. There was further anger when it emerged that Bitmex requires a user to undergo full KYC, including a selfie with their ID and the word “Bitmex” in order to change their email address.

The email breach does not come at a good time for Bitmex, which is reportedly being probed by the U.S. Commodity Futures Trading Commission (CFTC) over whether it permits U.S. traders to use its platform. Armed with thousands of user email addresses, the CFTC may well step up its investigation.

The reputational and regulatory cost of the blunder is still to be counted. In the interim, neglecting to use blind copy on a mass email has given Bitmex and its normally ebullient CEO Arthur Hayes pause for thought.

Do you think the email leak will permanently damage Bitmex’s reputation? Let us know in the comments section below.


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The Xi Effect – Chinese Government to Fund Blockchain Projects

The Xi Effect – Chinese Government to Fund Blockchain Projects

Chinese President Xi Jinping’s announcement that the country would invest heavily in blockchain technology – coupled with a sweeping move to remove online posts suggesting such technology is a scam – has nourished optimism long-held by crypto advocates. Of course, the reality is that China’s marked shift towards pro-blockchain policies is part of a much wider trend which has seen Asian multinationals and governments embrace the considerable potential of distributed ledger technologies.

Also read: China Ranks 35 Crypto Projects as President Xi Pushes Blockchain

A Two-Year Turnaround

President Xi’s announcement centered on the creation of a state-backed digital currency (a stablecoin tied to the renminbi), an idea which has been gestating since the country’s central bank started exploring the possibility as far back as 2014. With the dawn of a new decade, a law will come into effect on January 1 with the aim of “facilitating the development of the cryptography business and ensuring the security of cyberspace and information.”

The Xi Effect – Chinese Government to Fund Blockchain Projects

It is predicted that the currency in question will launch soon after, although perhaps the possibility of blockchain technologies powering the continued transformation of China’s vast industries is of greater significance. Xi specifically mentioned that the technology could be applied to realms including finance, public services, employment, education and infrastructure management. It’s all a far cry from 2017, when the government imposed a general ban on all crypto businesses and exchanges. From deep suspicion, to a state-supervised (albeit heavily surveilled) cryptocurrency, in just two years is quite a turnaround.

Soon after the announcement was made, the local government of Guangzhou announced a $150 million fund for outstanding blockchain projects, with more initiatives expected in the near future.

Surging Interest Across Asia

Needless to say, the news – which provoked a huge spike in search traffic for terms like ‘blockchain’ and ‘bitcoin’ – hasn’t harmed the prospects of Asian crypto projects in general, with stocks of various blockchain companies in the region soaring. On the markets, some of this week’s biggest beneficiaries have been Chinese blockchains, even if there’s nothing to suggest they’re due to receive an influx of fresh business from government enterprises. In fact, six of the seven best-performing crypto assets in the top 50 this week have Chinese origins. Bitcoin cash, up 38% in the past seven days, is the only outlier.

The Xi Effect – Chinese Government to Fund Blockchain Projects

Other companies seem to be riding the wave or at least benefiting in a roundabout way from the prevailing mood music: South Korean conglomerate Samsung has just announced the integration of Tron (TRX) with the Blockchain Keystore found on the Galaxy S10. As well as facilitating the creation of decentralized applications (dapps) running on the Tron ecosystem, the Keystore will let users access and trade TRX directly from the wallet on their handset. Perhaps coincidentally, industry sources are mulling over rumours that Samsung is outsourcing a part of its smartphone manufacturing to China.

The Xi Effect – Chinese Government to Fund Blockchain Projects

Samsung has been experimenting with blockchain technologies for some time now, and with their growing dapp arsenal, their long-term strategy seems positively crypto-centric. It isn’t the only smartphone company testing the blockchain waters either; Taiwanese electronics giant HTC has also invested heavily in decentralized services and a blockchain-powered handset, the Exodus 1, and its successor, the 1s, which can run a full Bitcoin node.

Where Next for China?

The long-term effect of China’s increasingly pro-blockchain outlook remains to be seen, and until its state cryptocurrency is hatched and various policies put into action, we won’t be able to quantify the consequences for blockchain technology and digital currencies more generally. That said, interest in the region is largely unrelated to the President’s ringing endorsement; according to a report by the Financial Times, Chinese companies have filed more patents on blockchain than companies from any other region in the world. A significant percentage of bitcoin mining is concentrated in the region, and many of the largest cryptocurrency exchanges are either based or were founded in the Asian continent, from Beijing and Singapore to Hong Kong and Tokyo. Regardless of its real ramifications, Asian crypto companies were never going to let President Xi’s decree go to waste.

Do you think China’s pro-blockchain legislation will benefit Bitcoin? Let us know in the comments section below.


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Satoshi’s Final Messages Leave Tantalizing Clues to His Disappearance

Satoshi’s Final Messages Leave Tantalizing Clues to His Disappearance

As Jameson Lopp once quipped, the smartest thing Satoshi did after creating Bitcoin was to disappear. The question isn’t ‘why did Satoshi disappear?’ but rather ‘why then?’ Was Satoshi’s departure in early 2011 scheduled long in advance, or did unforeseen events compel Nakamoto to pack his bags and flee the community he had founded, never to return? Several credible theories abound.

Also read: Why a VPN Is the First Layer You Should Pull On When Browsing the Web

Theory 1: It Was Planned All Along

Satoshi Nakamoto was a methodical and meticulous man. That much we can ascertain from his writings. He doesn’t seem the sort to wake up one morning and YOLO his way out of the community he created. Knowing there would be no coming back once he’d made the decision to leave, Satoshi may have had his departure scheduled months or even years in advance, and worked diligently to that deadline. If so, it would explain why his last forum post was a typically business-like despatch, leaving parting instructions on what had been remedied in build 0.3.19 of Bitcoin Core.

Julian Assange Thanks U.S. Government for 50,000% Gains on Wikileaks' Bitcoin Holdings

Theory 2: It Was Wikileaks

Satoshi tended to keep his emotions in check when posting on the Bitcointalk forum. He had the air of a man who knew he had a lot to do and a short time in which to do it, and thus refrained from shitposting or shooting the breeze. He could occasionally be brusque (“If you don’t believe me or don’t get it, I don’t have time to try to convince you, sorry”), but was never rude or prone to venting. His penultimate forum post, however, portrays a twinge of annoyance.

In response to a PC World article commenting on Wikileaks’ adoption of bitcoin to circumvent its financial blockade, Satoshi famously wrote: “It would have been nice to get this attention in any other context. WikiLeaks has kicked the hornet’s nest, and the swarm is headed towards us.” Could Wikileaks thrusting Bitcoin and its enigmatic creator into the spotlight have been the last straw that sent Satoshi scurrying for cover? The argument that Bitcoin was getting too big too fast, which expedited Satoshi’s departure, seems credible.

Satoshi’s Final Messages Leave Tantalizing Clues to His Disappearance

Theory 3: It Was the CIA

Satoshi’s final correspondence, from an April 26, 2011 email to Gavin Andresen, has given rise to another theory as to why he abruptly left. He wrote:

I wish you wouldn’t keep talking about me as a mysterious shadowy figure, the press just turns that into a pirate currency angle. Maybe instead make it about the open source project and give more credit to your dev contributors; it helps motivate them.

When Gavin replied, he informed Satoshi that he had been invited to speak at an event hosted by an organization under the CIA. Satoshi never replied. Did the mention of spooks spook Satoshi?

Theory 4: It Was Personal

We know nothing about Satoshi Nakamoto’s personal life. It is quite possible that his exodus was triggered by events that he could never have publicly communicated. Failing health, injury or new responsibilities (family, professional, personal) could have forced Satoshi’s hand, compelling him to bow out earlier than anticipated. If that were the case, we’d have no way of knowing. To this day, there are many who believe Satoshi is no longer with us because he is no longer alive.

Theory 5: It Was Symbolic

Satoshi Nakamoto and the birth of Bitcoin is a saga shrouded in symbology that reads like a Dan Brown novel for cypherpunks. From the name assigned to the genesis block to the sudden disappearance of its creator, it’s hard to avoid the religious undertones. Aside from its name, there is the oddity of the genesis block taking six days to mine. As speculated in an old Bitcointalk forum thread, this may have been an easter egg left by Satoshi in homage to the biblical account of creation. As Genesis 2:2 recounts: “And on the seventh day God ended his work which he had made; and he rested.”

For those interested in ascribing symbology to Satoshi’s actions, there’s more. Christ’s ministry on earth is believed to have lasted for around three years. Satoshi’s first known contact with the world occurred on August 22, 2008, in an email to b-money creator Wei Dai, though he is believed to have reached out to Adam Back before that. Satoshi’s final verified email was to Gavin Andresen on April 26, 2011, meaning that his ministry also lasted for around three years.

The fact that Satoshi’s teachings have been subject to extensive interpretation and misinterpretation in the years since, while his disciples await the second coming of Bitcoin’s creator, has further solidified the parallels with Christ. Satoshi wasn’t perfect – his code tells us that much – and common sense tells us that putting fallible men on pedestals is the antithesis of everything Bitcoin stands for. It is possible to be opposed to leadership cults, however, while also assigning messianic qualities to the life and times of Satoshi Nakamoto.

There is evidence, incidentally, that Satoshi was tiring of the cult that was beginning to form around him; the PC World article on Wikileaks he took exception to claimed that “Bitcoin is the creation of Japanese programmer Satoshi Nakamoto,” while in his final email to Gavin Andresen he complained “I wish you wouldn’t keep talking about me as a mysterious shadowy figure … Maybe instead make it about the open source project and give more credit to your dev contributors.” Satoshi had no interest in becoming a living legend and overshadowing his magnum opus.

Theory 6: Bitcoin Was Ready

According to the gospel of Luke, Jesus’ last recorded words were “Father, forgive them, for they do not know what they are doing.” Satoshi, on the other hand, checked out of this world in the belief that those around him knew exactly what they were doing. As he was to remark in one of his final emails, sent to Mike Hearn on April 23, 2011, “I’ve moved on to other things. It’s in good hands with Gavin and everyone.”

Satoshi had nursed Bitcoin through its formative years, and now it was capable of surviving without him solo mining, solo-fixing critical bugs and pushing out new Core releases. Perhaps Satoshi left because he had done all he had to do. Staying around would only tarnish his legacy and heighten the risk of him being doxxed as the world began to take a keen interest in his creation.

If so, the timing of Satoshi’s exit was to prove as impeccable as his arrival in the aftermath of the 2008 financial crisis. Despite internecine conflict, chain splits, and factions, Bitcoin hasn’t just survived – it’s thrived, morphing into an unstoppable organism that cannot be controlled by any one man.

Why do you think Satoshi Nakamoto left Bitcoin in 2011? Let us know in the comments section below.


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Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

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Why a VPN Is the First Layer You Should Pull On When Browsing the Web

Why a VPN Is the First Layer You Should Pull On When Browsing the Web

Virtual private networks (VPNs) can be useful for all kinds of things, from streaming foreign sports to protecting your identity from heightened online surveillance. For cryptocurrency users, VPNs are particularly precious, providing access to exchanges that are geo-restricted, and enabling crypto activities to be completed on the web without leaving a privacy-betraying footprint.

Also read: Stealth Miners on the BCH Network Attract Scrutiny

The Rise of the VPN

Virtual private networks can be traced back to 1996 when a Microsoft staffer conceived a peer-to-peer tunneling protocol (PPTP). In many ways, the protocol functioned as a precursor to the VPNs we see today, providing a private, secure connection between a computer and the world wide web, as it was then known.

The advantages of having a permanently encrypted conduit to the web are manifold. Think about how often you unwittingly connect to insecure public wifi, for example, with everything from credit card numbers and social media log-ins vulnerable to theft. A VPN, which lets you connect to a remote server while masking your true location, provides peace of mind by safeguarding data from third-party interception. Virtual private networks also block persistent IP tracking, which is trickier to prevent than insidious third-party tracking e.g. from Google.

Why a VPN Is the First Layer You Should Pull On When Browsing the Web

The Quest to Decentralize the VPN

VPNs can mitigate the worst data intrusions of centralized agencies (be it tech giants or governments), but they themselves are vulnerable to flaws inherent to centralization. This month, it emerged that popular provider NordVPN suffered a data breach in 2018 when a Finnish server in a rented data center was compromised. Although the company has asserted that no usernames or passwords were intercepted, the fiasco proves that VPNs are not invulnerable to the very attacks they endeavor to protect their users against.

Web3 architects intent on decentralizing all the things have naturally turned their attention to VPNs, where they see the potential to create more robust systems that aren’t vulnerable to the whims of central bodies acting unilaterally, be it hackers or law enforcement. Decentralized VPNs – dVPNs – work by apportioning a percentage of users’ upload bandwidth to carrying traffic for other users on the network. Although still very much in their infancy, dVPNS have the potential to obfuscate your crypto transactions and communications while eliminating the need for a central authority.

Why a VPN Is the First Layer You Should Pull On When Browsing the Web

One such project is Tachyon. As well as hiding your location, the protocol simulates HTTPS and SMTP, meaning it conceals the sites you browse, fooling others into thinking you’re visiting Youtube and Gmail respectively. Users’ requests are distributed through multiple different nodes with encryption, thereby overcoming the security vulnerabilities and inefficiencies of TCP/IP.

Another proposal, developed as part of the Web3 movement, is VPN⁰, a decentralized network built around a Distributed Hash Table (DHT), atop which sit several privacy-protecting mechanisms. What makes the network particularly unique is that it permits relay nodes to control which traffic they wish to transmit – without specifically learning what the content contains. This feat is achieved through the application of zero-knowledge proofs, a cryptographic technique in which the prover can validate to the verifier that a statement is true, without actually disclosing any information other than the validity of the statement. Developed by a trio of Brave browser security researchers, VPN⁰ awaits further development and funding.

Why a VPN Is the First Layer You Should Pull On When Browsing the Web

Why Cryptocurrency Users Should Consider a VPN

While everyday internet users are becoming more assertive with their privacy, motivated by widespread coverage of mass data collection and government snooping, bitcoiners have an even greater need for digital discretion. The cryptosphere, after all, has fallen prey to opportunistic hackers, with spear phishing and SIM-swapping just two examples of security breaches that have left traders out of pocket. A VPN is not a cloak of invisibility, granting its wearer carte blanche to evade or commit cyber crime with impunity, but it does heighten your security in a number of meaningful ways.

By encrypting your data when you trade, a VPN makes it more difficult for hackers to eavesdrop. Because VPNs conceal your IP address and prevent persistent IP tracking, your device’s location will not become connected to your wallet address. What’s more, using a remote server to mask your true location more effectively prevents targeted viruses and malware than many expensive software packages designed expressly for this purpose.

Of course, the advantages of VPN use extend beyond bolstering security. They can also widen your options by unblocking geo-blocked websites such as exchanges forbidden in your homeland. By granting unfettered access to otherwise verboten foreign portals, these networks can dramatically improve your trading experience. They can also prove a lifesaver, should your government suddenly censor access to an exchange in which you hold currency, for example.

Why a VPN Is the First Layer You Should Pull On When Browsing the Web

How to Choose the Right VPN for Your Needs

There are many VPNs to choose from, some free, some paid, and all with pros as well as cons.

Firstly, make sure you pick a VPN that does not store user logs, which could conceivably be handed over to third parties. Some VPN providers insist that this information is mandatory to guarantee optimal service, but in reality, they often sell your data to advertisers. Needless to say, this runs contrary to the very purpose of using a VPN in the first place. In any case, you certainly don’t want time-stamped details of your VPN sessions – as well as sites visited and files downloaded – falling into the wrong hands.

Once you’ve sourced a provider with a definitive zero-log policy, you should think about connection speed, the number of servers in different countries (prioritizing those with multiple severs in privacy-friendly nations), the level of encryption offered, traffic-restriction policies and customer support. It might also be smart to select a VPN that accepts payment in cryptocurrency, which can further enhance your privacy.

Practise Safe Browsing

Privacy absolutists are eagerly awaiting the day when decentralized VPNs become production ready, citing a distrust of centralized gateways’ privacy policies and questions surrounding network stability.

In the meantime, VPNs go a long way to ensuring safety and privacy in our hyper-connected world – and this applies to regular web users as well as those of us in the habit of transacting digital currency. Before you step out into the big bad web, take a moment to clad yourself in a VPN.

Do you think using a VPN provides added security when browsing the web? Let us know in the comments section below.


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Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post Why a VPN Is the First Layer You Should Pull On When Browsing the Web appeared first on Bitcoin News.

Exchange Tokens Have Outperformed BTC This Year

Exchange Tokens Have Outperformed BTC This Year

Few crypto assets have outperformed bitcoin this year, but the handful that have are predominantly exchange tokens. Their success attests to that of the token sale launchpads they have hosted, which have in turn driven demand for exchange tokens. But as IEOs start to wind down, can exchanges sustain the momentum, or will BTC recapture the lead and finish 2019 on a high?

Also read: China Ranks 35 Crypto Projects as President Xi Pushes Blockchain

2019 Was the Year of the Exchange Token

Bitcoin has had a good week, but despite putting a dent in every major crypto asset, thanks to Friday’s paint-melting rocket ride, it’s still got some catching up to do. Within the top 50 cryptocurrencies by market cap, aside from chainlink, which has recorded an 816% gain for the year, the only notable tokens to have bested BTC are huobi token (247%) and binance coin (235%). Just behind BTC (148%) is another exchange token, kucoin shares (138%).

Move outside of the top 50, and lurking at 118 by market cap is this year’s best performing exchange token, belonging to Bitmax. BTMX is up an impressive 394% for the year, just ahead of Okex’s OKB, which sits 91st by market cap with yearly gains of 358%. While there’s plenty to critique about the utility of exchange tokens, and their ability to sustain their new price levels, there’s no disputing that 2019 has been their year.

Exchange Tokens Have Outperformed BTC This Year

Can Exchange Tokens Escape the Fate of ETH?

Anyone who was hanging around the crypto space in 2017 will recall the meteoric rise of all crypto assets, ETH especially, which peaked at $1,400 on January 13, 2018, propelled there by the ICO craze. What came next is well documented, with ETH among the hardest hit when the crypto market receded. It has taken almost two years for ETH to recover its sense of purpose – which is now defi, apparently – and to start recouping its heavy losses.

Q4 tends to be a quiet time of year for token sales, and given the lackluster performance of the IEOs that have launched to date, there is evidence that the public’s appetite for exchange-hosted token sales is diminishing. ICOspeaks, which records forthcoming token sales, lists just two scheduled IEOs and ICOs apiece. Save for the long tail of pay-to-play IEOs listed on smaller and less salubrious exchanges like Exmarkets and Latoken, there’s not much on the horizon.

Ben Zhou, CEO of Bybit exchange, told news.Bitcoin.com: “Platform tokens were originally designed as a customer reward program, while being pumped up because of IEO hype over the last year. As what happened after the ICO retreat, investors will definitely revisit the intrinsic value of platform tokens – the success of the platform and the willingness of the platform to reward its customers.” Zhou went on to explain that there are ways to reward users without reliance on a token; in Bybit’s case, for instance, through issuing bonuses to users upon registration and for various campaigns. Bybit’s CEO claims that “This has been met by widespread approval by our customers.”

It would be as premature to call the demise of IEOs as it would be to predict the downfall of native exchange tokens. Crypto exchanges are one of the most profitable sectors in the industry to date, and are not about to slip away quietly into the night just because the whole IEO game has tapered off. As Binance has shown, the token launchpad is merely the first in a string of features to mandate native token usage, with subsequent products, including futures markets, also drawing heavily upon the exchange token. Kucoin is busy replicating this formula to a tee, with its Kumex derivatives platform due to launch in a few weeks.

Exchange Tokens Have Outperformed BTC This Year
This year’s best performing exchange tokens according to Cryptorank.io

Where There Are Exchanges, There Are Exchange Tokens

As gatekeepers to the cryptoconomy, exchanges can effectively force usage of their native tokens, through baking in trading discounts, IEO airdrop participation, and other incentives that make it advantageous to hold exchange tokens. For the leading proponents of this business model, such as Binance and Huobi, increasing the value of the token provides another revenue stream in itself. Rather than dumping their own stash of tokens onto the market, however, it is in the interests of these giants to support the value of their native token through whatever means they can, while monetizing in other ways.

BSV Price Drops 13% After Binance Announces Plans to Delist the Coin

Increasing the utility of exchange tokens allows the exchanges to portray themselves as more than merely a conduit for speculating on shitcoins, but rather as vital cogs in the cryptosphere. Their token is the yardstick by which their health is signaled to the world. As a result, exchanges will stop at nothing to see the price sustained. The only thing that could conceivably put a stop to that is a rampant bitcoin. Should BTC go on another run, as it did last Friday, no crypto asset will be safe.

Do you think exchange tokens can sustain their momentum? Let us know in the comments section below.


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Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post Exchange Tokens Have Outperformed BTC This Year appeared first on Bitcoin News.

How Hard Is It to Brute Force a Bitcoin Private Key?

How Hard Is It to Brute Force a Bitcoin Private Key?

Trying to crack a private key with a brute force attack is a bit like trying to count to infinity: the sooner you begin, the faster you’ll never get there. Despite being as next to impossible as impossible gets, using a brute force attack to crack a bitcoin private key remains an intriguing idea for many.

Also read: Mistakes Crypto Owners and Traders Should Avoid

The Dream That Never Dies

For math geeks, key cracking is a question of statistical probability and for hopeless dreamers, a question of ambition. Long shots capture the imagination of simple mammalian minds, and for those who wish to rage against the odds, the lottery is a game for the faint of heart – the finest display of sheer dumb mathematical bravery is in trying to brute force Bitcoin.

On the Bitcointalk forum, a related thread from Jun 11, 2018, continues to garner replies to this day. In ‘BitCrack – A tool for brute-forcing private keys,’ board members disassemble the prospects of making a brute force breakthrough with software specially designed for that task, with the most sober minds strongly dismissing the quest as a wild goose chase.

An early response from user Coin-1 politely attempts to dissuade anyone from proceeding any further: “Let’s calculate how much time you need to crack one Bitcoin-address on your machine. You said that your performance is 9 million BTC-addresses per second, i.e. approximately 223 BTC-addresses per second. Thus the brute forcing will take 2160-23 = 2137seconds! I guess it is more than septillion (1024) years!”

On an ordinary computer, attempting to extract funds from a bitcoin wallet to which you didn’t have the key would be a fool’s errand. What if, however, you had a faster, better computer that could attempt many more keys per second – would the tough nut of Bitcoin be a little easier to crack?

How Hard Is It to Brute Force a Bitcoin Private Key?

The Scale of the Problem

The first step in overcoming a challenge is in quantifying it. To do that we must look at exactly how many potential keys exist. A private wallet key is simply a number between 1 and 2256 and to brute force it all you need is to continue guessing until you hit the right number between 1 and 115 quattuorvigintillion.

That’s a hard number for the human brain to process, but to put it in perspective, it’s greater than the estimated number of atoms in the universe. At that scale, even the world’s fastest supercomputer – IBM’s Summit – if tasked with brute forcing Bitcoin would effectively take forever to break just one wallet, which would test the patience of even the most determined hacker.

How Hard Is It to Brute Force a Bitcoin Private Key?

Wallet Recovery

This sheer uselessness of brute force will dash the hopes of anyone who has ever lost their password or seed phrase and cannot recover their bitcoin, but for those in that very situation, all may not be lost. If you remember at least part of the password, a service such as Wallet Recovery Services may be able to assist. For most cryptocurrencies, however, you’ll need to trust the company with your full wallet. In the case of bitcoin and bitcoin cash, it is apparently possible to engage the service without handing over the full wallet.

If successful in cracking the wallet, a fee equal to 20% of the wallet’s holdings will be incurred, but it’s a no win, no fee endeavor. As always, it’s worth examining how the process works and doing your own research before deciding whether to engage these types of services.

How Hard Is It to Brute Force a Bitcoin Private Key?

Quantum of Solace

For some time now, quantum computing has been the great fear for the continued security and fidelity of Bitcoin, with cynics suggesting that private key cracking may be just around the corner. Recently those fears were stoked when Google announced it had reached “quantum supremacy,” completing a computation in just over three minutes that it claimed would have taken a conventional computer 10,000 years.

It was enough to spark debate in the crypto community, for whom quantum computing is a bogeyman trotted out at regular intervals to spread FUD. However, as sober heads including news.Bitcoin.com counseled, this was not the hammer blow promised.

Now, IBM have rubbished Google’s claims. While Google had stated it would take 10,000 years for a conventional computer to complete the computation, a recent blog post from IBM said: “We argue that an ideal simulation of the same task can be performed on a classical system in 2.5 days and with far greater fidelity.”

John Devadoss, Head of Global Development for NEO, and a quantum computing authority, told news.Bitcoin.com: “The quantum computing bogeyman is a bit like the AI bogeyman. First, there are way too many snake-oil salesmen, even in academia, because they want funding for their labs. Second, whilst progress is being made, albeit in arcane niche focus areas, the impractically high error rates coupled with the research lab-like constraints implies that real-world usage is way off on the horizon, if at all.”

For now, at least, it seems that quantum computing has yet to make the necessary quantum leap forward to trouble Bitcoin’s encryption. Cryptocurrency holders should remain vigilant to security threats, but brute force attacks should not keep them up at night. Successfully completing the heist would take an eternity, and ain’t nobody got time for that.

Do you think quantum computing will eventually break Bitcoin? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


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Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post How Hard Is It to Brute Force a Bitcoin Private Key? appeared first on Bitcoin News.

As Crypto Exchanges Exit the US, Which Trading Platforms Will Enter the Breach?

As Crypto Exchanges Exit the US, Which Trading Platforms Will Enter the Breach?

The U.S. remains a challenging environment for centralized cryptocurrency exchanges, with major players significantly scaling back their operations and others heading for the door. The most recent casualty of America’s stringent regulatory climate is one time market-leader Poloniex, which has “spun out” from parent company Circle, spinning out of the U.S. market in the process and leaving a void for other exchanges to fill.

Also read: Bakkt Announces Bitcoin Options After Record-Breaking Futures Volumes

Poloniex Heads for the Door, Other Exchanges Enter

Until fairly recently, American citizens could freely trade hundreds of digital assets across exchanges such as Bittrex, Poloniex, Bitfinex, and Binance. Those options have been rapidly whittled down, however, as centralized exchanges have been forced to either exclude the U.S. altogether or render the majority of their assets off-limits to traders east of the Atlantic.

Bitcoin Gold Issues Daily Update, Adds Replay Protection

Following a buyout from an Asian investment group, Poloniex will continue to operate internationally, but U.S. customers will be forced to cease trading from as early as November 1. Binance and Bittrex have also been given pause to reconsider their American strategies, vastly reducing the number of trading pairs available to customers in the USA. As centralized exchanges continue to struggle with regulation and red tape, the market seems primed for alternative solutions such as decentralized exchanges and token swapping protocols that aren’t so easily cowed by regulators. It’s a lucrative space which new players are actively seeking to exploit.

The Decline of Centralized Exchanges

American traders find themselves particularly ill-served by centralized exchanges. Not only do they have fewer platforms to trade on, but the available options are severely crippled and a poor reflection of the true state of the crypto market in 2019. Poloniex has officially hit the iceberg and is abandoning ship, Bittrex is severely wounded and a shadow of itself. Coinbase, Kraken and the relaunched Binance US are all options, but each has limitations due to a need to appease regulators, resulting in a sub-optimal experience. Coinbase is more truthfully a brokerage in any case, Kraken is struggling to innovate in the strict regulatory climate it finds itself in, and Binance US is possibly the least satisfying iteration of the exchanges, providing only a fraction of the trading pairs enjoyed by customers elsewhere.

U.S. traders are effectively operating with one hand tied behind their back while being force-fed the decaf soy milk latte of crypto. For those who want to enjoy full mobility and to drink in the “full fat” experience, two practical options remain: VPN or DEX. In the case of the Binance DEX, U.S. customers would need to use both, firing up a VPN to connect to the DEX, which defeats at least one of the reasons for choosing a decentralized exchange in the first place. Moreover, should an exchange find that U.S. customers are illegally accessing it, it could potentially freeze funds, which presents another headache.

As Crypto Exchanges Exit the US, Which Trading Platforms Will Enter the Breach?
The leading Ethereum DEXs according to Defi.pulse

From a legal perspective, a DEX is bound by the same rules and regulations as any centralized exchange, but if it is decentralized enough to have no formal company structure, U.S. regulators are largely powerless to act. Quite simply, if a DEX can be accessed from the U.S. then it can be traded upon. Of the existing options, Uniswap and Bancor are the leading Ethereum-based candidates, in terms of UX certainly, but also with regards to liquidity. Bancor has cracked the liquidity problem through the use of liquidity pools that enable conversion between tokens through the use of multiple smart contracts. Cotrader has built a DEX on the Bancor protocol that promises a “free, open source, unrestricted portal into the Bancor network,” enabling anyone, anywhere to trustlessly trade ERC20s.

As Crypto Exchanges Exit the US, Which Trading Platforms Will Enter the Breach?

Can’t Poloniex the DEX

Decentralized exchanges have been a long-held dream of the crypto community, but until recently, the drawbacks of using one mostly outweighed the benefits. Now the tide is finally turning as decentralized trading matures and key players become more adept at meeting customer expectations. The user experience has been greatly improved, order matching is faster, and slippage has been minimized through plugging into multiple liquidity pools.

Further, the very nature of decentralized exchanges means they cannot be easily censored and stopped. Without a central point of attack, DEXs avoid the vulnerabilities inherent to centralized exchanges, including being at the mercy of U.S. regulators. Now ever greater numbers of Ethereum DEXs are emerging including Nash, which bridges Ethereum and NEO, Loopring’s Dolomite DEX, and Dex.blue. There are also P2P platforms such as local.Bitcoin.com which enable users to swap BCH without the need to deposit funds.

After Fleeing From the US Government John McAfee Warns His Enemies

Another decentralized exchange which has opened to the sort of fanfare you would expect from a John McAfee project is McAfeeDex. As one of crypto’s most prominent and colorful characters, McAfee is certainly more than capable of getting the word out on his latest venture, but whether his eponymous DEX will fill the vacuum left by centralized exchanges remains to be seen.

It would be naive to think that decentralized exchanges can replace their centralized counterparts at this point in time; the fact that most DEXs are native to one blockchain only means the tech isn’t even capable of supporting seamless trading of multi-chain assets; wrapped workarounds such as WBTC are the closest substitute, currently. For U.S. traders craving the full trading experience, a combination of top 20 assets on centralized platforms and the long tail of ERC20s on decentralized protocols is about as good as they’re gonna get.

Which centralized and decentralized exchanges do you think will gain market share in the US? Let us know in the comments section below.


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Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

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Lightning Network User Confused By Protocol: Lost 30,000 USD

Lightning Network User Confused By Protocol: Lost 30,000 USD

The Lightning Network has long been touted by its proponents as a speedy, low-cost solution to Bitcoin’s scaling issues. A series of security scares and UX issues have called that vision into question however. The latest LN slip-up saw a user lose 4 BTC in one fell swoop.

Also read: Hidden Lightning Network Bug Allowed Spending of ‘Fake’ Bitcoins

Redditor Has a Lightning Nightmare

An unfortunate LN user claims to have lost 4 BTC after force-closing a channel using an older invalid state. Cue a cascade of alternately sardonic and sympathetic comments on the thread where redditor ZipoTm confessed their calamity.

How did this travesty befall the hapless ZipoTm? Well, on Lightning, the distribution of funds occurs when a channel is closed, with the protocol deferring to the most recently signed balance sheet. Or as one redditor explained, “If you force close using an older invalid state, they can take the money while it’s timelocked if their node is online.”

At current prices, that mistake cost ZipoTm a cool $30,000. Force-closing on an open payment channel would have taken but a second, but the effects were irreversible and catastrophic. ZipoTm isn’t a tech newb, either, confessing “I’m working as a system administrator, have some server knowledge and I bet that everybody who has bigger nodes will face the same issues.”

Lightning Network User Confused By Protocol: Lost 30,000 USD

Lightning Strikes Twice

This is the second embarrassing issue to have beset the Lightning Network in as many months. September saw the disclosure of a hidden bug that allowed the spending of ‘fake’ coins on the network. The revelation prompted Bitcoin Unlimited’s Peter Rizun to chide: “Many people pointed out how LN channel balances were claims on real bitcoins, and not actually real bitcoins themselves, and that problems like this would surface. LN proponents retorted that it was impossible for channel balances to be unbacked. LN proponents were wrong.”

With the Lightning Conference having taken place in Berlin over the weekend, and given the recent release of lnd v0.8.0-beta, the LN brain trust must be alarmed by the timing of the latest disaster story. Even if ZipoTm was at fault, the tale proves that despite being ultra-quick, Lightning Network is not yet production-ready in any shape or form – and its developers will have their work cut out to restore confidence in the technology.

Roger Ver weighed in on the story, quoting a tweet from Lightning Network earlier this month warning users “Don’t put more money on Lightning than you’re willing to lose.” Perhaps the calmness which ZipTim exhibited suggests he was willing to lose $30k – but that seems a stretch. One redditor could scarcely accept the apparent apathy, writing: “Tell me that’s not your whole stack? I’d be nowhere near this calm.”

To fulfill its promise as Bitcoin’s scaling savior, more rigorous Lightning Network testing is required. However, it is not always possible to legislate for the carelessness of users. A fully-working Lightning Network would appear to be some way off, but lessons can be learned in the interim. Perhaps the most important is to avoid locking up a substantial amount of bitcoin in a technology which is far from flawless at this juncture.

Lightning Network User Confused By Protocol: Lost 30,000 USD

Do you think LN will ever be ready for public use? Let us know in the comments section below.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

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How Centralized Payment Systems Learned to Accept Decentralized Cryptocurrency

How Centralized Payment Systems Learned to Accept Decentralized Cryptocurrency

They might not be shouting it from the rooftops, but fiat payment gateways are no longer the enemy of bitcoin. Hostilities have ceased, the bad blood has been let, and today the fiat and crypto worlds are bridged and doing business. Despite the two systems sporting opposing aims and architecture, many centralized payment processors have learned to live with decentralized currency.

Also read: How Fiat Money Fails: Deconstructing the Government’s Paper-Thin Promise

From Enemies to Frenemies

In the early days of Bitcoin, traditional fiat payment systems were an unwitting friend of cryptocurrency. Paypal was the on-ramp for the first bitcoin exchange, bitcoinmarket.com, though it was a short-lived affair. Cold feet on the part of fiat payment systems, once they caught wind of exactly what bitcoin was, saw crypto payments banned altogether, but in the years since, the tide has turned. Today, centralized and decentralized payment systems are more closely aligned than ever.

How Centralized Payment Systems Learned to Accept Decentralized Cryptocurrency

It would be stretching the truth to claim that the overlords of traditional finance are enamored with crypto, but they have at the very least turned a blind eye to the practice of cashing in and out of crypto using fiat gateways. For most bitcoiners, begrudging acceptance from centralized systems is good enough. Some payment solutions have gone further though, extending a warm embrace to crypto assets, as the following examples show.

Skrill

Founded in 2001 as Moneybookers Limited, then rebranded a decade later as Skrill, it took the online payment platform a further seven years before it started allowing users to buy and sell cryptocurrency, in the summer of 2018. CEO Lorenzo Pellegrino gushed about crypto when the announcement was made, venturing that cryptocurrency trading was “exciting and dynamic” and that Skrill’s digital wallet service lent itself to the environment.

How Centralized Payment Systems Learned to Accept Decentralized Cryptocurrency

Skrill’s cryptocurrency offering lets users from over 30 countries trade digital tokens including BTC, ETH, LTC, BCH, XRP, and ZRX, after partnering with an unnamed exchange to facilitate the service. Conversion from 40 fiat currencies into crypto is swift, and requires no additional verification. It’s a far cry from the company’s circumspect attitude to crypto in the years since bitcoin launched in 2008. A Skrill blog from earlier this year demonstrated the company’s evolving outlook: “If the past decade was cryptocurrencies’ proof of concept stage, the next decade will see them become rooted in the everyday fabric of life.” Bullish words.

Paypal

It’s possible to deposit and withdraw from crypto exchanges such as Coinbase and Gocoin using Paypal, and has been since Paypal formed a partnership with the companies in mid-2015. The online payments giant was also on board with Facebook’s new Libra cryptocurrency, and although it withdrew from the project earlier this month, it’s evident that Paypal is now pro-blockchain.

Consider, for example, the company’s filing of a patent last year to increase cryptocurrency payment speed by utilizing secondary private keys, thereby cutting wait times for transactions between merchants and consumers. Although bitcoin isn’t a major focus at Paypal, Chief Financial Officer John Rainey notes that the company “have teams clearly working on blockchain and cryptocurrency” and “want to take part in whatever form that takes in the future.”

The Daily: Coinbase Adds Paypal for Withdrawals, Gazprombank to Manage Crypto Assets

Credit Card

Credit card giants Visa and Mastercard have blown hot and cold on crypto, and a number of banks that issue their cards have banned cryptocurrency purchases altogether. Through third parties that operate on the financial rails controlled by the credit card giants, however, bitcoiners can cash in and out of crypto using credit and debit cards. Companies like Simplex are also helping in this respect. The Israeli-based payment processor allows crypto merchants to accept payments via credit card, backed by machine-learning algorithms that eliminate fraud, providing protection against chargebacks.

Earlier this year, Binance – the world’s largest cryptocurrency exchange by trade volume – linked up with Simplex to enable purchases with credit and debit cards. Bitcoin.com also has a similar deal in place, allowing BCH and BTC to be bought directly from the homepage with the aid of Simplex.

Debit Card

The last two years have seen the emergence of crypto debit cards that combine a cryptocurrency wallet with a conventional debit card that can be funded through liquidating cryptocurrency directly within the app. There have been speed bumps along the way, such as when Visa subsidiary Wavecrest withdrew service for several crypto card companies, but the sector has flourished since that upset. Centralized crypto wallet services such as Wirex and Revolut are now joined by a decentralized counterpart in Monolith. It enables users to retain custody of their crypto right up until the point that they liquidate it to load it onto their debit card.

Decentralized Finance Projects Are Starting to Ship
Monolith

News.Bitcoin.com spoke to Monolith’s CEO Mel Gelderman about the challenges of maintaining a decentralized wallet service with a centralized component. He explained how the U.K.-based Monolith took part in the Financial Conduct Authority’s regulatory sandbox and runs a Visa approved card program through its partners. “It has not been easy to develop the compliance and operational capabilities required to run crypto-fiat gateways,” Gelderman conceded. “However, crypto is steadily becoming more palatable to traditional financial services players.”

The New Norm

Today it’s much easier to purchase cryptocurrency than it was 10, five or even two years ago. The aforementioned firms are not the only payment processors keen to satisfy their customers by integrating with decentralized finance, incidentally. Last year, Square, best known for its payment-processing hardware such as chip and PIN readers, was licensed to offer New York residents the ability to transact bitcoin on its Cash App, causing shares of the company to hit a 52-week high.

There are still concerns over excessive KYC, financial surveillance on both the fiat and blockchain sides, and the propensity of fiat gateways to withdraw service at the drop of a hat. Nevertheless, the cryptosphere finds itself in a far stronger position than at any time in its short history. If centralized and decentralized payment systems can learn to co-exist, everyone stands to benefit.

Do you think traditional payment processors are more accepting of cryptocurrency these days? Let us know in the comments section below.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post How Centralized Payment Systems Learned to Accept Decentralized Cryptocurrency appeared first on Bitcoin News.

How to Start a Crypto Podcast

How to Start a Crypto Podcast

The idea of starting your own podcast is undeniably appealing. Not only do you get to sound off about a topic that’s close to your heart, but if you opt for the host-and-guest format, you get to engage in stimulating debates with interesting people. But before you rush off to order a USB mic and start booking your crypto heroes, there’s a few things you should know about podcasting.

Also read: How to Trade Crypto in Person Safely

The Pros and Cons of Podcasting

The podcast’s appeal partially stems from the fact that it can be done without the aid of third parties: if you’re reasonably tech savvy, you can write, record, edit and upload every episode by yourself. This elimination of intermediaries aligns well with bitcoiners, which goes some way towards explaining the proliferation of crypto podcasts.

Some of these factors compelled Matt Aaron to create Bitcoin.com’s very own podcast, which made its debut in February 2018. Since then it’s gone from strength to strength – and for Matt, it remains a labor of love.

“The pros definitely outweigh the cons,” he says. “Hosting a crypto podcast is an excuse to spend an hour picking the brains of someone you admire or can learn from, a person who might otherwise have no interest in speaking with you. On air, and a lot of times off-air, you can glean insights that help inform your thinking about cryptocurrency.” He adds:

Podcasts have become an increasingly popular medium, and many people prefer to learn about blockchain by listening to diverse perspectives rather than toiling through dense books.

“Of course, the cons can’t be ignored,” continues Aaron. “The sheer number of podcasts in this space can be daunting for anyone looking to launch their own. The need for an original angle is becoming stronger too, because there’s only so many times you can interview the founder of “X” coin or that legendary crypto personality and mine new material.”

How to Start a Crypto Podcast
Recent episodes of Matt Aaron’s Humans of Bitcoin podcast

Find Your Niche

Matt’s right: you need to find a niche. Are you doing a series on the history of bitcoin, focusing on flaws in the current financial system that crypto solves? Perhaps you’re interviewing movers and shakers, from programmers and dapp developers to UX designers and entrepreneurs. The important thing is that you have a good idea what your podcast is all about, and who you’re pitching it to.

While it might be tempting to make no topic or subtopic off-limits, be aware that there is a ton of competition out there. As such, you’ll need to think long and hard about how you differentiate yourself from other crypto-themed podcasts. It might be with a particular brand of humor, in-depth conversations with high-profile guests (how’s your contact book?) or aggressive marketing strategies, but overcoming the saturation is no picnic.

You should also perform due diligence on any potential guest. As Matt Aaron explains, “Many people in crypto end up being exposed as frauds or embroiled in some sort of legal snafu. If that happens and they’ve been a guest on your show, your name will appear next to theirs in a Google search. It’s bad publicity your podcast could do without. So, vet your guests properly and make sure they’re unlikely to be the next crypto meme.”

Write an Episode Outline

Once you’ve decided on your niche, it makes sense to come up with an outline for your first ‘season’ or batch of episodes. Focus on providing your audience with valuable and entertaining content and bringing a fresh perspective to the topic. Ask yourself: what is a crypto-curious listener getting out of subscribing? If you struggle to answer that question, you’re in trouble.

Having a clear episode outline will also prevent a form of mission creep, whereby you wind up losing sight of what it is you’re trying to achieve and resort to simply ranting about the latest happenings in the blockchain space. Having a clear, coherent structure is the best way of engaging listeners.

How to Start a Crypto Podcast

Essential Tools of the Trade

So what about the practicalities of actually creating and launching a blockchain podcast? How much work is required, and do you need to recruit a producer?

First things first, invest in a good-quality USB microphone – this will save you from having to use your computer’s built-in mic. Thankfully, the explosion of podcasts in recent years has led to the creation of dedicated apps that do a lot of the work for you, from cutting out audio gaps to recording each contributor’s audio on separate tracks, thereby making it easier to edit during the final mix.

One great tool – particularly if your podcast is a question-and-answer format with a remote guest – is Squadcast. You hit record, conduct your interview and end up with a high-quality, lossless audio recording. Video recording also comes as standard with each package so you can upload your podcast to Youtube, and up to three guests can feature on the same episode.

How to Start a Crypto Podcast

As for editing your recording, there are few better software suites than Hindenberg, which was originally built for radio journalists. Nifty features include automatic audio leveling, sound effects, royalty-free music tracks and noise-reduction capabilities. There’s also a clipboard feature, which is great for organizing audio material. It’s like having a sound engineer sitting by your side the whole time. Hindenburg is offering a 30-day free trial, so it’s worth experimenting to see if it suits your needs.

There is no shortage of options when it comes to online podcasts editors either: Alitu, Audacity, Spreaker and Garageband to name just a few. If you have the time and inclination, there’s no harm in giving each one a go. Sometimes it really does come down to personal preference.

Although Matt Aaron acknowledges the multitude of helpful apps available, he says budding podcast producers should not lose sight of the work required. “Getting the sound quality and editing just right is trickier than it might appear, it requires some trial and error. You want to be on the ball from the first episode, as no-one wants to be known for poor production standards. If there are any faults in the audio, it’s another excuse for the listener to switch off and find one of the many alternatives out there.”

Marketing and Monetizing Your Podcast

Once you’ve completed the fun stuff, it’s time to think about how you’re going to get your podcast out there. The cryptosphere is a hive of activity, and people get their information from various places: blogs and forum threads, Youtube interviews, tweets, Telegram, books. There’s no denying the popularity of podcasts though, so the question is, how are you going to publicize yours?

There are a few traditional marketing strategies of course, like churning out SEO blog content or throwing your money into pay-per-click advertising. Needless to say, you should also get some social media channels up and running to get the word out. Interact with others in this space, leverage guests’ audiences by compelling them to share the podcast with pull-quote images and video/soundbite snippets, run giveaways, and run paid promotions. It’s not a bad idea to also submit your podcast to podcatchers, aggregators, influencers, journalists and bloggers covering your beat.

It takes a lot of work, but busily promoting your podcast is the best way to find an audience. At this stage, you can monetize the endeavor by bringing partner brands on board, identifying possible sponsors using advertising networks like Midroll or Advertisecast. Alternatively, invite listeners to contribute on a pay-what-you-can model using a service like Patreon.

Getting a crypto podcast off the ground and then achieving success with it are two different things. But avoiding common mistakes is a good basis to start from. Despite the saturation, there’s never been a better time to launch a podcast centered on crypto themes, so if you have the passion and commitment coupled with realistic expectations, what are you waiting for? Get out there and start casting.

What are your favorite crypto podcasts? Let us know in the comments section below.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post How to Start a Crypto Podcast appeared first on Bitcoin News.

Smartphone Developers Embrace Crypto as Opera Integrates BTC and TRX

Smartphone Developers Embrace Crypto as Opera Integrates BTC and TRX

The love-in between smartphone developers and cryptocurrency users is smoldering. What started out as a flirtation by HTC and Samsung has blossomed into a full-blown affair, incorporating hardware and software support from a string of companies. Today, Opera ramped up its cryptocurrency support, integrating Bitcoin Core and Tron into its mobile browser wallet.

Also read: Running Bitcoin Cash: An Introduction to Operating a Full Node

Opera Sings Crypto’s Praises

Cryptocurrency users awoke this morning to the news of another smartphone integration. Opera’s Android wallet now supports BTC and TRX, in addition to ETH, with the promise of iOS to come. As the developer explained, “All of Opera’s features, like the free unlimited VPN, the built-in ad blocker and Crypto Wallet, follow the same line of thinking – you should be able to access them as fast as possible … You can now choose to add a Bitcoin card to your wallet, making it possible to send and receive money from the web.”

Smartphone Developers Embrace Crypto as Opera Integrates BTC and TRX

With 350 million users, the browser’s support for Bitcoin and Tron is significant. In the case of the former, it provides censorship-resist money directly within the web browser, enabling BTC to be spent on third party websites that accept the cryptocurrency. Tron integration, meanwhile, will prove a boon for decentralized applications, supplying smartphone users with access to a panoply of apps that exist beyond the purview of the Apple or Google Play stores. Opera has been supporting crypto for some time, having incorporated Ethereum into Android browsers last year, and Apple iOS this spring. It was the first major browser to integrate a crypto wallet, enabling crypto payments to be securely made on sites directly within the mobile browser.

Samsung Launches Galaxy Series Preloaded With Cryptocurrency Wallet
Samsung caught crypto headlines this year when it integrated ETH and later BTC into the Galaxy S10.

The Convergence of Crypto and Mobile

Mainstream crypto awareness and ultimately adoption appear a realistic prospect at this rate. Whereas in the past major tech companies merely flirted with blockchain, recent developments suggest a full-blown love affair in the making, with the end result likely to be a wider appreciation of cryptocurrency among smartphone users.

Facebook’s much-vaunted crypto payments system Libra could help in this respect. Although it’s a centralized protocol, it opens the possibility of a few billion monthly users exploring the topic more broadly, which can only be a good thing. Libra launches in 2020, so expect the hype train to keep rolling until then.

Zuckerberg’s big beast is not alone. Last month, popular Japanese messaging app Line launched Bitmax, an app-connected cryptocurrency exchange boasting five assets: BTC, BCH, ETH, LTC and XRP. Staying in Asia, Taiwanese electronics firm HTC has unveiled its new Exodus 1s handset equipped with a built-in hardware wallet to hold crypto. Unlike its predecessor Exodus 1, the 1s runs a full Bitcoin node – the first smartphone to do so. This means that users can contribute more fully to the security of the ecosystem and verify their own transactions.

Smartphone Developers Embrace Crypto as Opera Integrates BTC and TRX
HTC’s new Exodus 1s

The Budget Blockchain Phone

The Exodus 1s is a device tailored for crypto devotees rather than neophytes, and barriers to entry are lowered from a cost perspective also: it’s just $250, a major reduction on the Exodus’ $700 outlay. Paradoxically, some geographical barriers remain: the device is only available in Europe, Taiwan, Saudi Arabia and the United Arab Emirates (UAE), with more locations to be announced in future.

The convergence of bitcoin and smartphone wallets certainly makes it easier for individuals to spend their chosen cryptocurrency and interact with decentralized applications (dapps) on the go. Just last month, HTC announced that its original Exodus 1 handset would start supporting Bitcoin Cash (BCH) through its partnership with Bitcoin.com, in a collaboration that has seen the Bitcoin.com Wallet preloaded on the handset.

Smartphone Developers Embrace Crypto as Opera Integrates BTC and TRX
Opera’s Android web browser now supports BTC.

Of course, HTC is not the only mobile platform which is touting crypto-centric handsets. Samsung has been blazing the trail for a while, and its Galaxy S10 now supports 18 dapps and over 30 cryptocurrencies including BTC, ETH and HT. Millions will soon be able to use bitcoin with apps via the Blockchain Wallet Samsung has started including on its flagship handsets this year.

Can we expect more mobile giants to enter the crowded cryptosphere? Absolutely. In fact, they’re already mobilizing: Apple released a cryptographic software called CryptoKit for iOS 13 in June, and LG have hinted at their own crypto wallet by trademarking “ThinQ Wallet.”

These tech companies aren’t operating in silos, either: several have come together to create a government-backed blockchain network that will allow citizens to ditch hard copies of important documents in favor of a blockchain-powered mobile solution. As well as LG and Samsung, the consortium includes financial IT company Koscom and South Korea’s Shinhan Bank.

The days of spending cryptocurrency solely on desktop, or locking it away in hardware wallets, destined never to be spent, are over. There’s no obligation to spend crypto of course – it’s yours to use or store as you see fit. At least now, thanks to the efforts of smartphone developers, you have the option to deploy your digital assets on the web and on the go.

Do you think smartphone integration of cryptocurrency will lead to broader adoption? Let us know in the comments section below.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post Smartphone Developers Embrace Crypto as Opera Integrates BTC and TRX appeared first on Bitcoin News.

4 Cryptocurrency Projects That Successfully Changed Chains

4 Cryptocurrency Projects That Successfully Changed Chains

Choosing the right blockchain is a tough call for any development team. It’s a decision that entails correctly anticipating project requirements – scalability; speed; community; security – before a line of code has even been written. It’s no wonder that a project occasionally finds its first choice of blockchain isn’t ‘the one,’ forcing it to play the field.

Also read: Bitmain’s Jihan Wu Talks Mining and Industry Growth With Bitcoin.com’s CEO

Unchained: When Cryptos Drop Their Blockchain

Like marriage, blockchain is meant to be a life-long commitment. You pick your network and then you stick with it through thick and thin, because the alternative – to elope with a faster, more scalable model – is frowned upon. It’s also a hassle having to move all your stuff, like your token, community and development stack. And yet sometimes, when irreconcilable differences get too much, the benefits of chain-hopping outweigh those of staying put and sticking it out.

When games developer Biscuit named its medieval-fantasy EOS Knights, it seemed a certainty that the product would remain firmly wedded to the EOS blockchain. Following a name change from EOS Knights to Knight Story, however, the project has now signaled its intention to trade up. Knight Story has switched allegiance from EOS to Tron and will release an upgraded version of the blockchain game in December that will include a revamped economy powered by TRX and TRC-based tokens (including NFTs).

4 Cryptocurrency Projects That Successfully Changed Chains
Game of Trons: you win or you die.

Now that the company has pledged its fealty to Justin Sun, the CEO of TRON and Bittorrent was quick to heap praise upon the project. “There has never been a decentralized game of this scale before,” gushed Sun. “Biscuit’s successful rollout of blockchain gaming for mainstream audiences marks a turning point for the space.”

As for the deeper reasons for the change, Biscuit cites Tron network’s performance, developer-friendly tools, and robust ecosystem of applications. The company also believes Tron will grant it greater opportunities for ‘synergistic partnerships.’ Despite the fact that ‘synergistic partnerships’ sounds like corporate fluff, it may in fact be the key to understanding why a game that boasted 6,000 daily players on EOS would consider pastures new. The move means that in future Biscuit will be able to leverage Tron’s partnerships with Bittorrent and Opera in its ongoing quest to reach a wider audience and attract more players.

4 Cryptocurrency Projects That Successfully Changed Chains
EOS Knights is the second most popular EOS dapp. It’s now moved to Tron.

The Distributed Key to Change

Another project which realized its first choice simply wouldn’t work out is Remme, a public key infrastructure (PKI) solution striving to make passwords obsolete. Originally the team settled on Hyperledger Sawtooth to deliver its goals, choosing the blockchain because of Hyperledger’s parallel transaction execution, private network support with permissioning features, pub-sub events system, modularity, and pluggable consensus algorithms. The team were also enthused by the fact that Hyperledger offered multi-language support during the development phase.

How to Protect Yourself Against DNS Attacks When Using Cryptocurrency

But as Remme explained in July, the potential benefits of Hyperledger were eventually outweighed by a number of obstacles they encountered during the development phase that made migration the only sensible option. In the end Remme was forced to concede that “If we were to continue building on Sawtooth it would require us to direct our energies towards improving the Sawtooth ecosystem itself so it can operate a network our use cases require rather than on our core development.”

For that reason, the team decided to move to a more tried and tested system, selecting the EOSIO codebase of EOS. It’s a choice that appears to be already paying dividends: with greater support and battle-hardened infrastructure, EOSIO is fast-tracking Remme’s progress. After months of delays under Hyperledger, the EOSIO switch has rapidly led to successful testnet deployment and the Remme mainnet is now scheduled for launch this December.

4 Cryptocurrency Projects That Successfully Changed Chains://tron.network

Changenow Changes Its Chain

Crypto-changing site Changenow is in the business of swapping crypto, but in April the company announced it would be making a swap of another nature by transferring NOW Token from Ethereum to Binance Chain. Instead of choosing one chain over the other, however, Changenow decided that half of its tokens should remain on the Ethereum chain with the other half burned and reminted on Binance Chain.

According to a press release, this was done to give the platform’s users freedom of choice, with the Changenow site offering NOW Swaps for anyone who wants to make the change. A better explanation may be that the partial migration allowed Changenow to cash in on the huge amount of hype surrounding Binance Chain, and in the process become only the second coin to be listed on Binance DEX.

4 Cryptocurrency Projects That Successfully Changed Chains

Dev-initely Leaving

It’s not just crypto projects that switch blockchains – sometimes devs jump ship too. Pokkst is one developer who did just that, porting all of his work from Bitcoin Core to Bitcoin Cash, including his non-custodial wallet Crescent Cash.

Explaining the switch, the developer said: “With the complexity of the Lightning Network, Bitcoin (BTC) is a lost cause. Bitcoin Cash still works flawlessly though, just like how BTC used to.”

4 Cryptocurrency Projects That Successfully Changed Chains
Change isn’t always possible.

Thanks to an abundance of choice in the cryptosphere, it’s never too late to change hearts, minds and chains.

What other projects have successfully changed blockchains? Let us know in the comments section below.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post 4 Cryptocurrency Projects That Successfully Changed Chains appeared first on Bitcoin News.

How to Safely Store Your Wallet Recovery Phrase

How to Safely Store Your Wallet Recovery Phrase

As a cryptocurrency holder, security is paramount – and you can’t be too careful when it comes to your wallet recovery phrase. Unless you want your meticulously accrued crypto to disappear into the ether (or your ether to disappear into the cryptosphere), safely stashing your wallet mnemonic is vital. You must do everything in your power to construct a fortress around your recovery phrase, which you’ll need should you misplace your smartphone or lose your wallet.

Also read: Bitcoin and Mnemonics: The Art of the Secret Phrase

Hide Yo Seed, Hide Yo Phrase

Just as you’d source the biggest deadbolt and fiercest Rottweiler to guard a physical bounty, protecting your crypto from nefarious third parties requires vigor and cunning. The following guide outlines a variety of ways you might go about storing your wallet recovery phrase – as well as the pros and cons to each approach. Be it a 24-word mnemonic, conventional password, numeric PIN, or a combination thereof, it needs to be stored in such a manner that you and you only can access it. There’s no perfect solution to this problem, but these five options come pretty close.

cold storage

Steel Punch Card

Protect your recovery phrase from physical deterioration caused by fire damage, flooding and other acts of god by engraving it onto a steel plate. Services such as Blockplate are perfect for this purpose, supplying materials that are stainless, rust-free, acid-resistant, non-toxic and fireproof. In essence, you are turning your recovery phrase into the Terminator – an object that can, unlike a piece of paper, withstand a ridiculous amount of damage and stay the course.

As for the cons, they should be obvious: you still have to stash the plate in a safe place, and if it falls into the wrong hands, well, there’s not much you can do. Consequently, you might consider storing your prized plate offsite – close enough to your home to access it conveniently, but sufficiently well hidden.

Bank Vault or Safety Deposit Box

There’s still some merit in the idea of storing valuables offline in a bank or safety deposit box. Sure, banks occasionally get broken into, and CCTV footage of masked raiders ransacking reinforced concrete rooms – even those deep underground, as in the Hatton Garden heist – is enough to give anyone pause. But 99.9% of the time, valuables locked in a bank stay there until such time as the account-holder calls by to make a withdrawal. It’s far better to store your recovery phrase in a physical vault than on a note-taking app, in the cloud or, heaven forbid, in a document on your desktop. Hackers gonna hack.

Split the Secret

Sharing schemes distribute parts of a secret among a set of trusted participants, none of whom know what the others hold. Shamir’s Secret Sharing is one such algorithm with a hierarchical component inbuilt. Which is to say that you can regulate the trustworthiness of participants in the scheme, for instance by making blood relatives more trusted than associates. Apparently, the Winklevoss twins used a similar principle to store shards of private keys in safety deposit boxes spread throughout the country.

The drawback to splitting your wallet seed into parts and doling it out is that multiple participants could conceivably collude to meet the threshold requirement of shares and uncover the phrase. However, if you don’t like sharing, you can still use this approach but retain all the parts yourself in separate locations – ideally with a backup of each for redundancy.

Brainwallet: The Bitcoin Wallet That’s All in Your Head

Memorize It

Memorizing a wallet recovery phrase is surprisingly easy once you create a memory palace to hold it. This is essentially a well-known physical location (e.g. your kindergarten, first home, workplace) that you visualize and then traverse in your head, laying down words from your wallet phrase as you go from room to room. Once committed to memory and rehearsed a few times, odds are you’ll recall those 12 or 24 words for life. This technique is particularly good when crossing borders, where you wish to transport cryptocurrency without possessing a physical clue to its existence. Relying solely on your brain is a dangerous game, though, which means that even with a memory palace in place, you’ll want a physical copy of your wallet phrase, dotted down and stashed in a safe place.

Obfuscate It

Even if an adversary discovers your wallet recovery phrase, it will be worthless to them if you’ve taken steps to obfuscate it. Techniques can range from the basic (rearranging the words) to the more elaborate, such as switching the first letter in certain words, or writing down their equivalent in a foreign language you’re familiar with. Use your imagination, in other words, and whatever technique you deploy, keep a record of how to unscramble the message in a separate place. Just don’t title it “Secret to unscrambling my wallet seed.”

Ellipal Hardware Cold Wallet Review

Plan for the Inevitable

Another thing to bear in mind is that when you check out of this world, your recovery phrase will vanish with you, unless you pass it on to your inheritor. So, remember to include instructions on accessing your secret phrase in your will. Someone else might as well spend those satoshis you’ve assiduously accrued during your lifetime.

It’s also prudent to make more than one copy of your recovery phrase and store it in a different location. After all, none of the above methods are entirely foolproof: as well as being robbed, banks can burn down or go bust. Just remember to safeguard your get-out-of-jail copy with the same rigor as you employed for the original.

What other wallet recovery phrase techniques do you recommend? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post How to Safely Store Your Wallet Recovery Phrase appeared first on Bitcoin News.

Earn More Interest on Your Crypto With These Comparison Tools

Earn More Interest on Your Crypto With These Comparison Tools

2019 has been the year in which crypto lending has really taken off. Centralized and decentralized finance have been major growth areas, aided by crypto exchange integration and a backdrop of negative interest rates in the banking sector. Why be penalized for saving fiat when you can be rewarded for saving crypto?

Also read: How to Trade Crypto in Person Safely

Crypto Lending Options Are Stacking Up

Competition among crypto lending platforms is heating up. With major exchanges such as Binance throwing their considerable weight behind the movement, incumbent platforms have been sharpening the pencil in a bid to offer their lenders and borrowers a better APR. This week, for instance, Nexo, cut its borrowing rates to as low as 5.9%. Given that many crypto lenders are prone to charge up to 4% in origination fees and 5-13% in liquidation fees, Nexo is confident that its improved offer will entice crypto borrowers shopping around for the best deal.

Earn More Interest on Your Crypto Interest Rate

That shopping process has gotten a lot easier thanks to the emergence of crypto lending comparison portals. These platforms provide a side-by-side comparison of what the leading centralized and decentralized lending solutions have to offer. Last week, Coinmarketcap launched a product that heralds its entry into the growing defi market. The tool, which the listing site has dubbed Coinmarketcap Interest, features finance data such as the best annualized interest rates for borrowing and lending cryptocurrencies across a variety of platforms.

Coinmarketcap doesn’t hold first mover advantage in this sphere, however, as there are already a number of high-level tools for analyzing the lending marketplace.

Loanscan

Loanscan is perhaps the gold standard in the sector, and after a redesign in May the site is better than ever. Originally built as a stealth tool for the crypto lending app Linen, Loanscan now serves as a standalone interest comparison product. The site is packed with features, information and graphical visualizations, making it fun just to play around with, depending on your love for data.

The site allows you to view address, protocol, or asset level analytics across a range of timeframes, such as 24-hours, week or month. For those who take a keen interest not only in where the market is today, but where it has been, Loanscan has a historical data tab too.

Earn More Interest on Your Crypto With These Comparison Tools
Loanscan

The range of possibilities with Loanscan is significant, so whether you want to know what the current value of all outstanding loans in the market is ($142M) or what the one-month repayments are ($67M) you shouldn’t have trouble finding the answer. Most importantly, Loanscan also provides comparison tables of the best interest rates for loaning and lending cryptocurrencies featuring DAI, ETH and BTC on platforms such as dYdX, Dharma, Fulcrum and Makerdao.

Due to its depth of information and rich presentation style, Loanscan is probably still the best all-round destination for experienced crypto users, however, there are simpler information sources out there.

Earn More Interest on Your Crypto With These Comparison Tools
Loanscan

Coinmarketcap Interest

While Coinmarketcap Interest doesn’t offer the same level of graphical wizardry as Loanscan, instead opting for a plain yet clean UI, it does pack a punch in terms of the information offered and ease of use. For those already well acquainted with the CMC layout and style, there is little adjustment required to get up to speed with Coinmarketcap Interest.

Earn More Interest on Your Crypto With These Comparison Tools

For the 30 or more stablecoins and cryptocurrencies which feature on CMC Interest, each has two tabs: “Earn Interest” and “Borrow Crypto.” All you need to do is select the currency you’d like to borrow or lend on the left, and then select a preferred platform depending on annualized interest rate, whether the platform is CEX or DEX, and the duration of the loan.

All in all it’s a pretty slick operation and while you don’t get the same level of control or information as you do on Loanscan, for those who just want to make money or borrow it without any of the deep-level analysis, CMC Interest works well.

Defi Pulse

If you’re more interested in broader ecosystem statistics than individual loans, Defi Pulse is another great analytical tool for decentralized finance and statistics geeks. For instance, if you want to know the total amount of money locked up in smart contracts on the Ethereum blockchain, Defi Pulse has got you covered. Want to know the current public network capacity of the Lightning Network? Defi Pulse has that too. You can also find out how much is locked up in DEXs, derivatives, assets and more, making it a highly useful tool for anyone doing deep research into the overall market.

Crypto networks are built upon open access and transparency. Thanks to monitoring sites and comparison tools that tap into solutions built upon these blockchains, cryptocurrency users can determine the best way to maximize their holdings. If you’re interested in interest, it pays to do your research.

What are your favorite defi and lending comparison sites? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post Earn More Interest on Your Crypto With These Comparison Tools appeared first on Bitcoin News.

6 Darknet Markets for the Crypto Curious

6 Darknet Markets for the Crypto Curious

If you’ve got a few thousand satoshis burning a hole in your wallet, the darknet beckons. There’s no obligation to spend a single sat while scouring the darker recesses of the web, but it’s nice to know that should you get the urge, your crypto’s good. There are few certainties when shopping on darknet markets (DNMs), but acceptance of BTC, XMR, and other leading cryptos is a given. Here’s a snapshot of what the current crop of darknet markets has to offer.

Also read: Bitcoin ATM in Miami Airport Raises Questions About Traveling With Crypto

Sliding Into the DNMs

Although darknet markets are under increased threat from law enforcement, business continues to boom. Every time a darknet market is taken down, a new head of the Hydra springs up in its place. Dark.fail lists around 20 DNMs, as well as forums and other darknet resources. A cornucopia of forbidden pleasures is but a Tor connection away, but as with all endeavors that involve dabbling in gray or black markets, discretion is advised. Intrepid bitcoiners eager to indulge in a little retail therapy can boot up their browser and mosey down any of the following bazaars.

6 Darknet Markets for the Crypto Curious

Empire Market

Reliance on any single DNM is unwise, as you never know when a site might be busted, backdoored, DDoSed into oblivion, or head for the exits. That said, at this point in time, Empire is the DNM leader by some distance. It’s got almost 40,000 listings for drugs alone and has a thriving ecosystem of vendors and customers who congregate on darknet forums like Dread. Empire’s a little over a year old, but you wouldn’t think it to look at the size of the place. Its subdread board of over 8,000 users vastly exceeds that of any other DNM. If there’s one criticism of Empire, it’s that it’s often offline. That’s the trouble with being the king: everyone wants to topple you.

6 Darknet Markets for the Crypto Curious
Grey Market

Grey Market

Grey Market is one of the newer DNMs, making its online debut in mid-2019. Despite its youth, it already boasts over 450 vendors and some 4,700 products, from cannabis vape oil to goods aimed at those with a stronger constitution. As a wallet-less market, there’s no need to deposit funds before you can shop. For every order, you dispatch coins from a wallet you already control to a newly generated address. In theory, this ensures better security for users. Grey Market accepts BTC and XMR and has a 10-tier EXP (experience) structure for vendors.

6 Darknet Markets for the Crypto Curious
Cannazon

Cannazon

Cannazon’s logo gives a good indication of the sort of products it offers, with kush lovers well catered for. Like Grey Market, the accepted currencies here are BTC and XMR and there’s a multisig escrow system which is standard with DNMs. Cannazon has been operating since mid-2016, which is practically forever in the world of darknet markets. One good thing about Cannazon is that they vet vendors pretty hard to ensure a high level of product and service and there are 15 vendor tiers. Unlike Grey Market, Cannazon will not ship to or from the U.S.

Cryptonia

Cryptonia cares about security. That’s why, as soon as you alight on the site, you’re bludgeoned with reassurances: “Cryptonia features the most secure 2/3 Bitcoin Multisig implementation of any market, a transparent wallet-less escrow system” and so forth. XMR and BTC are the accepted cryptocurrencies, and though the UX isn’t a strong point, the thousands of product listings more than compensate.

Tochka

Whatever your poison, you’ll find it on Tochka. This DNM, which has been operating since 2014, offers a seven-day escrow system and two-of-three multisig. BTC, XMR, and LTC are the favored currencies. Over 6,800 products are on sale at the time of writing, from just under 600 vendors: everything from seeds and edibles to viagra and growth hormone. Interestingly, Tochka has joined forced with DNMAvengers, a forum dedicated to reducing harm and spreading awareness via testing of products suspected of containing adulterants. What’s more, the site allows dead drops, should customers wish to subtly pick up their wares from a prearranged location.

6 Darknet Markets for the Crypto Curious
Tochka

Apollon

With over 10,000 listings for drugs alone, Apollon can’t be accused of scrimping on choice. It accepts a good selection of cryptocurrencies too: bitcoin cash as well as BTC, XMR, and LTC. It’s a traditional direct deposit market, so you need to fund your wallet address and wait for the deposit to clear before you can order. There’s nothing novel about Apollon, but that’s okay. The mere existence of multiple DNMs, no matter how generic, lessens the likelihood of them all becoming unavailable at once.

6 Darknet Markets for the Crypto Curious

Needless to say, if you do decide to avail yourself of any of the aforementioned darknet markets – or any others not included in this list – keep your opsec on point and exercise caution at every pass.

What are your thoughts on darknet markets? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


Images courtesy of Shutterstock.


Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

The post 6 Darknet Markets for the Crypto Curious appeared first on Bitcoin News.

Smart Contract Blockchains Are Struggling to Scale

Smart Contract Blockchains Are Struggling to Scale

Second generation blockchains were presented as being faster, cheaper, and more scalable than Bitcoin. Third generation chains (basically anything that came after Ethereum) promised even greater optimizations. In the event, these networks have run into the same difficulties as Bitcoin, with competition for scarce resources leading to mounting costs and congestion. To tackle these problems, an array of scaling solutions has been proffered – some of which could also benefit UTXO blockchains such as BCH and BTC.

Also read: 80% of Crypto Trade Volume Tracked by Blockchain Surveillance

The Great Scaling Debate

At the annual Ethereum developers’ conference in Osaka last week, most of the talks were about scaling. So was a good chunk of the informal talk between delegates, many of whom have grave concerns about Ethereum’s ability to meet growing network demand. Eth 2.0, the much-vaunted upgrade that will involve a transition from PoW to PoS, is still years away, with many Devcon attendees conceding that it may never happen. This impasse has prompted rival smart contract chains such as Qtum to position themselves as more scalable alternatives.

Smart Contract Blockchains Are Struggling to Scale
This year’s Devcon was held in Osaka, Japan.

Over on EOS, there are similar problems stacking up. Unlike Ethereum, EOS isn’t really gunning for the decentralized finance crown, but it does share one thing in common: growing demand for finite resources. On Ethereum, those resources manifest as block space which pushes up gas prices. On EOS, it takes the form of computational resources: RAM (virtual storage) and CPU, which is the amount of time a block producer will allocate to transactions from a particular account.

Smart Contract Blockchains Are Struggling to Scale
Ethereum gas prices rose sharply last month

Rising and erratic computational costs on EOS have forced developers to seek scaling solutions of their own. The architecture of blockchains such as Bitcoin, EOS, and Ethereum differs substantially, but this much holds true: onchain resources are limited and there is an open market competing for space. Just as your car moves more slowly and is less fuel efficient during rush hour, at peak times on crypto networks, your transaction is likely to be slower and more expensive. Fixing this problem calls for some out the blocks thinking.

Smart Contract Blockchains Are Struggling to Scale
Current EOS costs according to EOS Resource Planner

Virtual CPU and Offchain Transactions

For EOS, scaling salvation has come courtesy of Liquidapps, whose vRAM product has now been complemented by a vCPU counterpart. This approach involves taking these precious resources off-chain to a separate network of nodes that perform the computation at low cost, before broadcasting the verification to the EOS main chain. Although currently being provisioned on EOS, the same technology can be applied to Ethereum, or even to Bitcoin Cash, for developers seeking to create decentralized applications that require access to cheap storage.

For Ethereum, the scaling solution presented as the likeliest to succeed is Plasma, which can handle hundreds of transactions per second, and now supports smart contracts. As co-founder Jinglan Wang puts it, defi projects saying they don’t need Ethereum scaling solutions right now is like a New Yorker saying they don’t need a Metrocard in rush hour. Plasma is a layer two solution, whose BTC analogue is Lightning Network.

Smart Contract Blockchains Are Struggling to Scale

Dapp Developers Must Choose Wisely

Developers pondering the best network on which to launch decentralized applications have some tough choices.

Ethereum has a large ecosystem of users, devs, and companies, but it’s running near capacity, and network fees have been rising for months. Scaling solutions such as Matic can help.

EOS provides free transactions at the point of access, making it more consumer-friendly, but popular dapps risk landing their developers with rising computational costs. Secondary solutions such as vRAM can mitigate this however.

Qtum has just undergone its first hard fork, adding a new EVM that’s enhanced its smart contract capabilities, while retaining the UTXO model first pioneered on Bitcoin. It’s basically Ethereum without the scaling problems, albeit with a smaller ecosystem at this point in time.

Smart Contract Blockchains Are Struggling to Scale

Horizontal vs Vertical Scaling

Taking transactions offchain, be it to a sidechain or layer two, is not without compromises. Generally speaking, there is a reduction in decentralization and in transaction finality. The architects of these solutions stress that a micropayment doesn’t need the same level of security and trustlessness as a $1 billion BTC transaction. Gaming and gambling dapps, for instance, are fine to use a product like Liquidapps’ vRAM for offchain storage, or Plasma for low-cost transactions.

To return to the traffic analogy, side streets can be used to skirt the traffic snarling up the freeway, but they’re not designed to support 16-wheelers. Blockchain scaling solutions can therefore be more accurately described as scaling options: choices that will be suitable for some projects, and unacceptable to others.

Smart Contract Blockchains Are Struggling to Scale

Vertical scaling is the process of increasing throughput by increasing block or node capacity. It’s the approach taken by Bitcoin Cash, for instance. The solution to Bitcoin blocks becoming full, its proponents argue, is simply to add a couple more lanes to the highway. It’s a simple approach, but one that has proven very effective so far. Horizontal scaling entails taking as much of the load off the main chain as possible, pushing it out to third party solutions that add extensibility.

Despite the millions of dollars and tens of thousands of hours poured into blockchain scaling, the truth is, we still don’t know which solutions will prevail. Bigger blocks; more sidechains; building up the stack; developing horizontally. Through trial and error, discourse and debate, a path will be found to make blockchains ready for the mass adoption that all crypto advocates see as inevitable. In the here and now, though, the architects of so-called next-generation blockchains are learning a lesson that bitcoiners learned long ago: onchain, there’s no such thing as infinite scalability.

Which blockchain scaling solutions do you believe have the best chance of success? Let us know in the comments section below.


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ICOs Are Dead But ICO Scammers Are Immortal

ICOs Are Dead But ICO Scammers Are Immortal

The initial coin offering may have all but died, but the ICO scammer marches on regardless. Whereas legitimate projects have to wrangle with all kinds of challenges including the strength of the market, generating value for investors, creating a real product and actually delivering on the promises they make, the soulless scammer is unencumbered by technical constraints, work ethic or any sense of decency.

Also read: Bitcoin’s Smallest Unit ‘Satoshi’ Added to Oxford English Dictionary

How Do You Kill That Which Has No Life?

Much like the humble cockroach, there are few conditions in which the ICO scammer cannot operate. Even with peak ICO and token mania well behind us, scammers persist. There are a few things guaranteed to make scammers scatter, however, including legal action, regulatory enforcement, and of course, unwanted press. The following ICOs have all been branded scams, despite their orchestrators noisily protesting their innocence.

ICOs Are Dead But ICO Scammers Are Immortal

Karat Gets Stick

Blockchain may be a fertile soil for the germination of new ideas, but it is also a dumping ground for risible concepts and con artists who obfuscate their true intentions. One idea that has been floating around the crypto bowl for some time now is of a gold-backed cryptocurrency. Karatbars is a prime example of the gold-backed fad and one which has drawn some serious questions lately.

In 2018, the German firm launched Karatgold Coin (KBC) after an ICO that reportedly raised $100 million. To follow that first fundraiser, Karatbars is now looking to conduct another ICO in 2019. This time the company claims to be creating the Karatbank Coin (confusingly also KBC) for its cryptocurrency bank in Miami, leading the Florida Office of Financial Regulation (OFR) to open an investigation into the company which is still ongoing.

ICOs Are Dead But ICO Scammers Are Immortal
Seems legit.

In a video on the Karatbars homepage, Dr. Harald Seiz introduces himself as “the visionary and founder of Karatbars” which is enough to raise an eyebrow if not a red flag. A Youtube video on April 2019 titled ‘Karatbars Harald Seiz To Create 20K Millionaires by 2021!’ is enough to raise greater suspicion still. Products on the Karatbars site include gift cards, credit cards and actual paper money, all of which can be sold with affiliate marketing. Regulators in the Netherlands called this gold buying and selling system ‘multi-level marketing,’ while Namibia was plain enough to call it a ‘pyramid scheme.’

What of the gold itself on which the entire Karatbars concept is built? Independent researchers have failed to verify the existence of the goldmine which the company claims to own. While cynical minds have often claimed that a goldmine is simply a hole in the ground owned by a liar, in the case of Karatbar, not even the hole exists.

ICOs Are Dead But ICO Scammers Are Immortal
Like Steven Seagal, ICO scammers are Hard to Kill – but most lack the star’s charm and charisma.

When Mountie?

In March, Canadian police froze the accounts of Kevin Hobbs and Lisa Cheng, whose company Vanbex raised $22 million in 2017 from the sale of the Etherparty (FUEL) token. Despite claims that FUEL would be used to create a smart contracts ecosystem, no such thing ever materialized, with court documents claiming there was no intention to ever develop this dream world.

The colorful past of Hobbs gave added interest to the matter, with the company founder reported to have past convictions for drug possession and money laundering. In a twist which sounds like a plot point straight from an episode of Breaking Bad, Hobbs claimed his newfound wealth came not from misappropriated company funds, but from gambling winnings of around $60,000 a month. Put another way, when you have the gambling skills of Hobbs, the house always loses.

ICOs Are Dead But ICO Scammers Are Immortal

Records produced by the Royal Canadian Mounted Police (RCMP) show that the Vanbex ICO was completed on Aug. 17, 2017. Hobbs then withdrew around $5.5 million from OTC trading desk Cumberland, with the first of the transactions occurring just four days later on August 21. From there it is alleged that Hobbs and Cheng went on a luxury spending spree. The fraud investigation continues, although no charges have as yet been brought, but that has not prevented investigators from freezing the duo’s bank accounts and seizing personal items including two Range Rovers and a Lamborghini.

In Canada they claim the Mounties always get their man, and although you may know precisely when they’ll come calling, revving around in a high-powered sports car is a surefire way to land in their crosshairs. When Mountie? Shortly after ‘When Lambo?’

That’s a Scam

In April, one of the biggest scams of the year was ended when Korean police arrested 12 people on suspicion of stealing $18.7 million from elderly investors through a ponzi scheme called M-Coin. Perhaps the most interesting part of the story, however, is that the investigators were first alerted to the crime with the aid of an artificial intelligence designed to scour the internet for keywords and phrases. Once the authorities were alerted, the criminals were duly tracked down and arrested. This means that artificial intelligence is now officially smart enough to know a scam when it sees one, even when human intelligence isn’t.

ICOs Are Dead But ICO Scammers Are Immortal

A Fantasy Market

Not all ICO misadventures reach the heights of M-Coin, FUEL or Karatbar, but those who believe more modest indiscretions may go unnoticed would do well to heed the story of adult content marketplace Fantasy Market. Its founder Jonathan C. Lucas raised a mere $63,000 before being hauled up by the SEC this September. According to SEC litigation, “Lucas made numerous materially false statements in a whitepaper and online to induce investors to participate in the ICO.”

It added: “Lucas claimed that a “working-beta” version of the company’s adult-entertainment platform existed when one did not, presented a fictitious management team, and misrepresented his own experience.”

Following the SEC findings, Lucas agreed to pay back $15,000 to resolve claims, pending court approval. The irony is that although Lucas persuaded investors to buy into a completely Fantasy Market, the even greater fantasy was believing that he could get away with it.

Why do you think so many people are taken in by ICO scammers? Let us know in the comments section below.


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10 of the Best Telegram Crypto Channels

10 of the Best Telegram Crypto Channels

Telegram’s token might have received short shrift from the SEC, but its messaging app has been embraced everywhere by everyone. 300 million users attest to the success of Pavel Durov’s end-to-end encrypted platform, which has become a mainstay of the crypto community. On the rare occasions when Telegram experiences an outage, there is a discernible dip in cryptosphere chatter. The rest of the time, crypto Telegram is a hive of activity. Here’s a selection of what it has to offer.

Also read: Tax Guide: What Crypto Owners Should Know

Telegram Is Alive and Well in 2019

In 2018, following a short-lived flirtation with Slack and Discord, the cryptosphere set up camp on Telegram, where it’s been embedded ever since. If crypto Twitter is for serious discourse, thought leadership and occasional mud-slinging, crypto Telegram is for more ephemeral – but no less vital – discourse: trading, accessing market data, catching up on industry news and sharing dank memes by the sticker set.

And then there’s the token sales of course, for it wouldn’t do to forget them. Even in the post-ICO era, the rules of IEO engagement mandate a healthy Telegram following for crypto projects. Their Telegram channels serve as a focal point for updating the community on projects, token sale dates and bounty campaign opportunities.

10 of the Best Telegram Crypto Channels

Token sale monitoring service ICOspeaks has assembled a shortlist of the most popular Telegram crypto channels. It includes a selection of leading cryptocurrency news and exchange feeds, in English and Russian. To that list can be added the following channels which provide a snapshot of what crypto Telegram has to offer.

ICO Drops

A lot of the prominent Telegram channels have “ICO” in their name as a hangover from 2018, despite their content being far broader these days. ICO Drops is a case in point. It still covers token sales, but its most valuable content touches upon general industry news: Bakkt; custodial solutions; SEC enforcement. Its accompanying infographics provide a tl;dr for those who don’t have the time to read full articles.

ICO Analytics

ICO Analytics falls into the same boat as ICO Drops, but it’s not just another clone: the quality of this channel’s research speaks for itself. If you’re looking for figures on token sale ROIs, exchange token performance and other metrics, you’ll find it here, neatly packaged into bar graphs and charts.

10 of the Best Telegram Crypto Channels

Cointrendz

One for the swing traders, Cointrendz provides a steady stream of updates on which cryptocurrencies are breaking out. Or pumping, as it’s better known. If your strategy involves following the volume and skimming what you can off the top, Cointrendz has got you covered. Cryptonomia does a similar job.

News.Bitcoin.com

It’s a given that you’ve got to shill your own channel in a round-up of this nature, so here’s ours. A stream of all the articles that get published on news.Bitcoin.com. Click ‘em if you like the look of the preview snippet. If you don’t, don’t. For pure Bitcoin Cash news, meanwhile, the unaffiliated and aptly named Bitcoin Cash News will hit the spot, while Spanish speakers should check out Crypto Noticias.

The Crypto Room

All of the channels up until now have been read only, which is fine for absorbing information, but when you want to interact you need to hit up a discussion channel that’s open to anyone. There’s a plethora of candidates to choose from, but for focus and flow (some channels are so popular they move too fast), The Crypto Room gets it about right.

Best Telegram Bots

It’s not just the people that make crypto Telegram so essential: it’s also the bots – the benevolent ones at least. Telegram bots can perform a host of useful functions, from displaying wallet balances to providing price alerts and facilitating crypto swaps directly within the app. Always perform due diligence on the team behind a Telegram bot before admitting it to your channel, though, just in case it’s doing more than passively responding to your commands. Popular bots and automated services include Tokenstats, @Cryptowhalebot, @tracktxbot, @Cryptocurrencyalertingbot, and @buttonwalletbot.

10 of the Best Telegram Crypto Channels
Button Wallet lets you send and receive crypto in Telegram

Botje11

Everyone’s got their favorite crypto chart reader, a guru who appears to have the ability to sift through the tea leaves on Tradingview and predict where the market’s headed. Yours probably isn’t Botje11, but he’s a good example of what Telegram chart diviners do: provide solid analysis, couched in just enough disclaimers to retain their credibility whatever way the needle moves next.

10 of the Best Telegram Crypto Channels

Binance Research

The research arm of the world’s largest cryptocurrency exchange is arguably one of its strongest divisions. Binance Research is right up there with Bitmex Research and Coinmetrics for the quality of its original reporting, and its Telegram channel is filled with deep dives and fun factoids.

Rekt Plebs

The anti-trading channel, Rekt Plebs will teach you what not to do. In short, don’t buy shitcoins.

What are your favorite crypto Telegram channels? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


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Bitcoin Is a Weapon for Free Speech in the Face of Government and Corporate Censorship

Bitcoin as Free Speech Money: Government and Corporate Censorship Shows the Value of Financial Sovereignty

The latest skirmishes in the bruising trade war between the U.S. and China have led to the unlikely politicization of the NBA. But how did the views of a basketball executive become such a political football? And what does China’s ideological commitment to censorship say about the value of free speech and of free speech money, as bitcoin is sometimes known?

Also read: Berlusconi Admins Disappear — Darknet Users Rush to Find Alternatives

US-China Censorship Spat Highlights the Value of Free Speech

The Communist Party’s gangsterish demands on private companies is nothing new, but the recent decision by Houston Rockets general manager Daryl Morey to tweet support for pro-democracy protestors amid bedlam in Hong Kong quickly exposed just how fragile the notion of ‘free speech’ really is. In the face of opprobrium from Beijing, Morey’s climbdown, augmented by groveling input from Rockets owner Tilman Fertitta and NBA spokesman Mike Bass, was pitiful to behold. But it hinted at the wider problem of gutlessness among companies that have provoked the ire of the Chinese government.

Bitcoin Is a Weapon for Free Speech in the Face of Government and Corporate Censorship
American leftists see an offensive frog. The Chinese see an offensive bear.

Basic Rights and Backdoor Entry Points

A curated list of companies that have kowtowed to Chinese censorship requests, maintained on Github, is damning. As well as the NBA, the roll of shame includes Apple, Marriott, Nike, ESPN, several of the world’s largest airlines like British Airways, Qantas and American Airlines, and Versace. With trade talks between the US and China underway in Washington, the specter of censorship, while not on the agenda, will loom large over proceedings.

Bitcoin Is a Weapon for Free Speech in the Face of Government and Corporate Censorship
Some of the US companies to have self-censored.

Both nations have a lot to answer for as far as free speech, privacy, money and other basic human rights are concerned. China’s persistent assault on freedom seems more flagrant, but the U.S. – and, for that matter, other western nations – hardly cover themselves in glory. Attorney General William Barr recently squeezed major tech companies to provide government agencies with backdoor entry points for encrypted devices and software. It remains perfectly legal for citizens throughout the world to be fired by their employer or interrogated by customs for something they’ve said on social media – even when it occurred years ago.

Who Watches the Watchers?

Edward Snowden’s exposè of rampant state surveillance shows that when it comes to assembling a digital panopticon that’s always watching, the Americans are even more ruthless than the Chinese. At least in China you can see the cameras observing you; there’s no such courtesy when the U.S. agencies activate your webcam and start recording.

Speaking of surveillance and its insidious incursion into people’s lives, the Washington Post just reported that more than 400 police departments across the U.S. have entered into surveillance partnerships with Amazon’s camera-enabled doorbell company, Ring. It’s yet another way in which the government is utilizing tech, while co-opting big business to bear down upon civil rights and liberties.

Bitcoin Is a Weapon for Free Speech in the Face of Government and Corporate Censorship

In the modern world, digital freedom is everything. The bulk of our lives now unfold online: our conversations, our financial transactions, our very identities. What we are witnessing, increasingly, is free speech being smothered via the deplatforming of certain voices and an attempt by governments to introduce regulatory oversight on financial transactions which goes beyond ensuring proper taxation, but – under the guise of crime prevention – impinges upon privacy at a fundamental level. When governments seek to blunt-force encrypted devices and software, it requires a stupefying level of naivety to assume that their motivation is cracking down on kiddie porn.

Value and dignity exist in an internet where speech, financial autonomy and other basic rights are not controlled by government agencies or international conglomerates. Where our private data is not commoditized and sold to the highest bidder, and where we have the right to lives that are not the object of constant and unforgiving scrutiny.

Bitcoin Is a Weapon for Free Speech in the Face of Government and Corporate Censorship

The Value of Free Speech Money

Avoiding inference from third parties in the form of censure (deplatforming) and restriction of speech are basic desires shared by all digital citizens. This is why, when the topic of censorship and governmental overreach rears its head, Bitcoin isn’t far behind. Being able to process payments on the internet without permission or risk of confiscation is a privilege that provokes a desire to exercise the same level of freedom in other realms. To harness fully open source, secure and private systems of expression that are immune to the tentacles of power.

If the convergence of state and corporate interests continues unchecked, we are all imperilled; Chinese, American, or otherwise. Seized bank accounts, stolen information, frozen assets and ever greater attempts to stifle free speech and freedom of association will become the norm, and not just for those existing on the fringes, but for the masses. Is it any wonder that protestors harness technology to combat the might of the state? Tools such as PGP, Bitcoin, and decentralized networks allow individuals to conduct their affairs without permission from any bank, corporation or government.

A Time for Reckoning

While the summit in Washington is focused on matters such as trade imbalances and intellectual property violations, at an individual level we have bigger questions to ask of ourselves. Are we prepared to endure online censorship and a veritable onslaught on our civil liberties? Or are we willing to fight for an internet that does not function as an arm of the state but as an open platform for the free exchange of ideas and value? A censorship-resistant internet benefits everyone. It also benefits Bitcoin, for where there’s free speech, there’s demand for free speech money.

Do you think free speech and financial sovereignty as provided by Bitcoin are interlinked? Let us know in the comments section below.

Op-ed disclaimer: This is an Op-ed article. The opinions expressed in this article are the author’s own. Bitcoin.com is not responsible for or liable for any content, accuracy or quality within the Op-ed article. Readers should do their own due diligence before taking any actions related to the content. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any information in this Op-ed article.


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5 of the Best Crypto Swapping Services

5 of the Best Crypto Swapping Services

Creating an exchange account, signing in and placing an order every time you want to switch cryptos is like using a sledgehammer to crack a walnut. It’s an incredibly inefficient way to jump between cryptos, and given that no exchange has all the coins, it necessitates creating multiple accounts, with the added verification and security risks this entails. Crypto-swapping platforms promise to do the hard work for you, plugging into exchange APIs and exchanging coins on your behalf.

Also read: Swedish Government Auctions Cryptocurrency Again

Swapy

Swapy claims to offer the best exchange rate possible without the need to manually place buy/sell orders. It manages this by combining over 10 exchanges to give users more low-cap and low liquidity tokens at spot price. Currently, you can swap BTC, ETH and USDT into over 70 different tokens, from XEM and REM to BCH and DASH. All of the exchange flows to your wallet can be tracked on-screen.

5 of the Best Crypto Swapping Services

What’s nifty about Swapy is that it charges a fee only on the amount users will save relative to competitor services. In other words, Swapy only gets a cut of what you save on a swap, doing away with a flat fee entirely. Holders of REM tokens can further increase their discount level by up to 90%. Account registration is necessary with Swapy, but only if you’re looking to claim the maximum available discount.

Changenow

Changenow only entered the marketplace last year, but has captured a significant share of the market already. The fact that it enables purchases to be made with credit card is a useful feature that’s unusual to see with crypto-swapping services. The platform enforces AML/KYC: if a transaction is marked as suspicious, the exchange is paused and the customer is asked to confirm their identity. Changenow imposes no limits on exchanges and more than 170 coins can be converted, from BTC and ETH to BCH, LTC and more niche altcoins. All transactions take under 15 minutes to complete, and a fee of 0.5% is incorporated into the exchange rate you pay.

5 of the Best Crypto Swapping Services
Changenow

Changelly

Changelly is one of the best-known platforms, delivering a fixed-rate mechanism that protects against the risk of market fluctuations when tokens are being swapped. Changelly claims the stability is assured by integrating a small reserve inside the exchange rate when the final quote is given to the user. This month, the platform launched an iOS app as well as a second version of its Android app, making it even easier for users to convert coins on the go.

5 of the Best Crypto Swapping Services
Changelly

Changelly was founded in 2015 and supports over 150 cryptocurrencies, taking a 0.25% fee for all swaps. You’ll need an email address to use the service though, and Changelly reserves the right to apply AML/KYC to certain users, addresses and particular transactions, which may deter privacy absolutists. Like Changenow, Changelly enables credit card purchases of crypto thanks to a partnership with Simplex.

Shapeshift

Speaking of KYC, Shapeshift caught flak when it announced that it would adopt a fully verified model, disincentivizing the same users who raised an eyebrow to Changelly’s policy. Citing pressure from regulators, the non-custodial exchange admitted that the move provoked the departure of many valuable API partners – but nonetheless, it remains a viable service for some.

5 of the Best Crypto Swapping Services

Shapeshift offers a unique exchange rate for each coin that changes every 30 seconds according to market conditions, but its typical ‘miner’ fee is in the ballpark of 0.5%. Support is provided for 29 cryptocurrencies including BTC, BCH and DAI, and boasts one of the nicest interfaces on the market.

Flyp.me

“Simple, fast and private. No registration” is the strapline you see when alighting on flyp.me, and for users troubled by KYC, it’s music to the ears. With flyp.me, you can exchange over 30 cryptocurrencies instantly including BTC, DASH, LTC, and a bunch of other altcoins while retaining full privacy. You also retain at least a measure of control over the exchange rate: when you hit the ‘Flyp now’ button, the rate is locked in for the next few minutes. Flyp.me promises to leverage several trading platforms to secure the best exchange, analyzing the market depth and liquidity of the currency in question and taking a 0.5% cut while they’re at it.

5 of the Best Crypto Swapping Services
Flyp.me

What’s your favorite crypto swapping service? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


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Decentralized Exchanges Are Evolving at Last

Decentralized Exchanges Are Evolving at Last

The humble DEX has come a long way since the days of Etherdelta. While not all of those steps have been forward – such as the enforcement of KYC on IDEX – the scope and quality of decentralized trading platforms has evolved greatly. As an examination of several new and emerging platforms shows, DEXs can finally hold a flame to CEXs.

Also read: United Nations Agency Unicef Launches Cryptocurrency Fund

Decentralized Finance Has Revitalized Decentralized Exchanges

ERC20 token trading platforms still constitute the bulk of all DEXs, but that’s starting to change. The decentralized finance (defi) movement, which is synonymous with Ethereum, is also permeating other chains and domains, resulting in the creation of some interesting decentralized exchanges. As a case in point, the new platform that blockchain project Fetch.AI is launching will be for trading metals – and not just speculatively, but with physical delivery.

Decentralized Exchanges Are Evolving at Last“The decentralized exchange will change the way metals and other commodities are traded and funded,” promise Fetch.AI, and they have the backing of some serious players, including several leading Turkish steelmakers such as Baştuğ Metallurgy, an iron and steel manufacturing giant. The DEX, which is scheduled to launch in a few weeks, will integrate electronic shipping documents and live monitoring tools, providing an end-to-end trading and consignment system for metals. The decision to deploy a DEX rather than a centralized exchange (CEX) was to provide full on-chain transparency and allow trustless participation for various industry players.

The same principles can be seen at play in the other DEXs springing up across the cryptosphere. In September, for example, Nash finally launched, based around an ethos of “secure self-custody and borderless finance.” Nash supports cross-chain trading between Ethereum and NEO. It uses an off-chain matching engine to combine the speed and functionality of a centralized platform with the noncustodial benefits of a decentralized exchange. Decred’s first DEX is also in its advanced stages, with the goal of enabling “a trustless trade process designed to cut out the bots, the middlemen, and the centralized power.”

Decentralized Exchanges Are Evolving at Last

From Bitmex to Bitdex

Anything that centralized exchanges can do, decentralized exchanges can do too. Not as quickly, necessarily, and not with the same liquidity, but these trade-offs are worth it for traders who favor security and privacy. With CEXs becoming a KYC-riddled nightmare – Bitmex is believed to be the next platform to bow to regulatory pressure – DEXs are one of the last refuges of privacy for traders. There are exceptions of course, including IDEX, and KYC is required on Nash to access fiat currency options, but for the most part, DEXs still reside on private land.

Hopefully Bitdex will maintain that tradition, should it come to pass. The proposed platform will operate as a decentralized version of Bitmex, with “priceless financial contracts,” no centralized operator and solvency ensured through an on-chain price feed. At Devcon in Osaka on October 8, defi contracts platform UMA Protocol further built upon this proposal, explaining how priceless contracts can be applied to create efficient synthetic tokens, futures, and swaps. Similar work is currently being done by Synthetix, which has issued around 20 “synths” – tradable tokens matched with assets such as gold, BTC, and stocks.

Decentralized Exchanges Are Evolving at Last
Dolomite DEX

The Latest DEXs Are Feature-Rich

Anyone who traded ERC20s on Etherdelta back in the day will recall how grating the experience was, with fatally mispriced orders never more than a misclick away. Not only do the current generation of DEXs have more protections against mispriced orders and other user errors, but they pack a ton of new features. On September 23, Loopring’s Dolomite DEX launched, enabling trading directly from noncustodial Ethereum wallets. For those who desire fiat access, there’s the option to connect your bank account or debit card to purchase crypto and also to exchange from crypto back to USD. Tools include an integrated portfolio manager and margin trading of up to 5X using Dydx’s trading protocol.

Decentralized Exchanges Are Evolving at Last
Dex.blue

Dex.blue is another new platform that, like Dolomite, combines an easy-to-use trading interface with advanced options for professionals. Because it features WBTC, traders can gain exposure to BTC despite operating on the Ethereum blockchain, and due to its decentralized design, there are no limits on trading. Coupled with hybrid platforms like local.Bitcoin.com, which enables noncustodial P2P exchange of bitcoin cash using multisig, traders tired of CEXs have never had more options.

What’s your favorite DEX? Let us know in the comments section below.


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