Bitcoin 2.0: Sidechains, Ethereum And Zerocash, Oh My Now What

Crypto Currency

Weird, interesting, and also hugely enthusiastic things are afoot in the world of Bitcoin as well as blockchains. I offer you Zerocash, a completely confidential money; Ethereum, a blockchain system created to decentralize much of the Net; and also sidechains, a proposal to increase the progression of Bitcoin itself. Any kind of one of these might certainly end up being a large bargain. All 3? Prick up your ears.

Of Bitcoins As well as Blockchains

If you’re not au fait with blockchains, your head may already be dipping. Some background: Bitcoin, the infamous cryptocurrency, is improved a new sort of distributed-consensus technology called a blockchain, which allows deals to be tightly kept and also confirmed without any central authority whatsoever, considering that (to oversimplify) they are validated by the entire network.

Its success has actually generated ratings of variant cryptocurrencies, known as “altcoins,” the most well-known of which is Dogecoin. Yet Bitcoin stays, without a doubt, the large dog.

If you manage more than half of the computations that power any sort of cryptocurrency, then you could spend the same money greater than when: a “51 % strike.” Altcoins are particularly at risk. However the stunning quantity of calculating power being poured right into the Bitcoin network renders it (probably) effectively immune to such an assault, as per this mindboggling chart from blockchain.info–.

BTChashrate.

The Bitcoin mining network is currently performing some three hundred quadrillion hash computations per second to protect and verify Bitcoin transactions. (If you believe that’s environmentally inefficient, compare it to gold mining.) At the same time, in spite of its much-publicized decrease of late, Bitcoin still has a cumulative market capitalization of virtually $5 billion, two times just what it was a year back.

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Bitcoin is simply slightly intriguing as a shop of worth; there are many excellent alternatives. It’s more fascinating as a means to transfer money to anywhere as well as any individual, with higher speed and reduced purchase fees compared to most alternatives, without any ID requirements.

Yet it’s really intriguing because it’s the globe’s very first type of programmable cash.

Many individuals don’t cherish that Bitcoin assists an easy scripting language which could orchestrate purchases. (In fact all deals in fact run as manuscripts.) This language already supports instances such as: down payments that instantly revert after an amount of time, escrow purchases, transactions which rely on some outside condition (albeit in a complicated method that requires a third-party “oracle”), and a lot more.

Exactly what are each one of the possible applications of totally programmable money? Particularly if the capabilities of that scripting language are expanded? I do not know, and neither do you. It’s the proverbial entire new ballgame.

However development is complicated. Bitcoin is the only cryptocurrency powered and also protected by a genuinely immense mining network, but due to the fact that it’s worth so much, and also its network is so extensive, modifications to Bitcoin itself are always promulgated really gradually, and testing is finished with harsh tentative care. So we can try out new kinds of blockchains and cryptocurrencies (like Ethereum as well as Zerocash), or we can rely on the value, deficiency and (technical) stability of Bitcoin, yet we can not do both. Right?

… Wrong, says Adam Back.

Sidechains: Back, Hillside, and also Blockstream.

The “3 hundred quadrillion hashes” mentioned up above describe efforts to please the Hashcash proof-of-work feature that Adam Back developeded way back in 1997, utilized today to validate Bitcoin transactions. Now Back is back with a brand-new proposal: sidechains, which would permit Bitcoins (and also other blockchain possessions) to be moved in between blockchains.

Back and also co. are not behaving totally from technical altruism. He and a team of co-founders, consisting of many core Bitcoin developers, moved by former Zero-Knowledge Systems CEO Austin Hillside, have actually an introduced a startup called Blockstream. According to Coindesk, they have already raised $15 million in an ongoing financing round, as well as included Reid Hoffman to their board. Their exact business remains strange, yet is constructed around sidechains. (The sidechain code itself will obviously be open-source. View Blockstream’s recent Reddit AMA.).

To quote the sidechains white paper (PDF):.

The development of independent yet basically comparable systems is problematic … the most noticeable tasks could be the least practically sound … discourages technical advancement while at the same time encouraging market video games … We prefer a world where interoperable altchains can be quickly created and also made use of, yet without unnecessarily fragmentising markets and also advancement. In this paper, we say that it is possible to simultaneously obtain these apparently contradictory goals … individuals do not should be as concerned that their holdings are secured a single experimental altchain, considering that sidechain coins could be redeemed.

To quote, er, myself: “You could in principle have hundreds of sidechains “pegged” to Bitcoin, all with various features as well as functions … and also all of them making use of the deficiency as well as resilience ensured by the main Bitcoin blockchain, which consequently might iterate to apply speculative sidechain attributes once they have actually been attempted and also examined.”.

Blockstream has lots of other influential fans, including Vinod Khosla and also Gavin Andresen, chief researcher of the Bitcoin Foundation (that also recently did an AMA):.

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Crypto Currencies

Crypto Currency

Crypto currencies

 

The term ‘cryptocurrency’ refers to online or digital cash that can be traded online for goods as well as solutions.

While this might appear dangerous by itself, cryptocurrencies are called such because they are safeguarded making use of cryptography (translated into an essentially solid code) and traded over peer-to-peer networks (file-sharing straight in between celebrations).

Using public and also exclusive tricks is applied to securely move the currency from one celebration to an additional.

When you own cryptocurrency, it behaves much like gold– that is, it has value similarly physical cash does. Much like bodily money, cryptocurrencies are subject to fluctuations in value.

The very first as well as most prominent instance of cryptocurrency is Bitcoin, which was introduced in 2009. Based upon its popularity, numerous alternate cryptocurrencies have entered circulation since then.

Some of the most prominent among them consist of Namecoin, Peercoin, and Litecoin.

A lot of manufacturers will decline Bitcoin or any type of cryptocurrency as payment, nonetheless, the rise in popularity has viewed a variety of online firms start to acknowledge Bitcoin as a viable choice, such as Etsy.com, Overstock.com, and also Reddit.com.

Criticisms

Similar to the majority of internet experiences, cryptocurrencies have their doubters. Being anonymous and practically untraceable, they come to be an easy technique for criminals to make prohibited transactions, such as the purchase of illegal compounds and also hazardous services.

One of the most significant example of this was Silk Road, an online underground market that used Bitcoin as currency. When it was finally closed down in 2013, the FBI confiscated 144,000 bitcoins (worth roughly $28 million).

While cryptocurrencies themselves are intensely shielded, it’s still possible to lose your entire digital lot of money. Merely losing a password or shedding access to your online budget can result in the effective deficiency of your cryptocurrency.

Being a decentralised system of exchange, such points are not safeguarded under insurance provider; users accountable for their own security.

Benefits

Being digital money and also consequently dispersed online as opposed to in any physical kind, cryptocurrencies are not associateded with any type of one nation.

Because of this, their value could not be had an effect on by a centralised financial institution. Their worth is commonly established by supply and also demand (basically, the amount of individuals want to pay for them). Some see this as a change in power from the government as well as economic establishments, back to individuals; nevertheless, it’s not unusual for mainstream users to locate the absence of rule behind cryptocurrencies to be upsetting.

Unlike regular financial purchases, cryptocurrency does not produce deal costs, and, as it is not checked by a 3rd party, it does not have a taxation system in place. Moreover, as soon as a transaction has occurred, it can not be reversed or traced back.

The online budgets which contain Bitcoins are private: Unless one chooses to make their online pocketbook public, no-one can see the number of Bitcoins they have.

Cryptocurrency is a fast-growing means of transaction that makes it possible for customers to continue to be completely anon

ymous whilst acquiring products online. Whilst it has both advantages and also drawbacks, it’s showing no sign of decreasing and also is rapidly becoming a much more traditional method of payment.

Crypto currencies

 

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How Digital Currency Could Transform Our Lives

Crypto Currency


Laura ShinLaura ShinContributor

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Susan Athey On How Digital Currency Could Transform Our Lives

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This article is the first installment in a three-part series on digital currencies, such as Bitcoin, Litecoin, Ripple and others. Part 2 covers the security advantages and disadvantages of cryptocurrencies, as well as the obstacles to their adoption, and Part 3 explains how MIT students, the poor and criminals will all benefit from Bitcoin.

Insofar as this is possible, Susan Athey is a rockstar economist.

At age 36, the Stanford Graduate School of Business professor became the first woman to receive the prestigious John Bates Clark Medal, awarded to an American economist under age 40 who has made the most significant contribution to economic thought and knowledge. The former MIT and Harvard professor has a whole host of other accolades to her name: member of the National Academy of Sciences, member of the American Academy of Arts and Sciences, plus many more. She also was the first chief economist hired at Microsoft MSFT +0.59%, as a consultant, and she now serves on the board of Ripple Labs, the creator of the Ripple protocol, a more bank-friendly alternative to Bitcoin.

Her work has focused on the cutting edge of technology. One theme in particular has been how complex platforms and marketplaces, such as internet search advertising and online advertising auctions, can be designed to make them work more efficiently — for instance, using big data to predict how advertisers would react if online ad prices were changed and how that would change the users’ experience of and interaction with ads.

She also has concentrated on how technology enables the creation of new platforms, and how that affects the industries involved — for instance, how the internet has affected news media. “This is a new frontier of statistics and econometrics — the statistics of economics: to try to combine tools that are geared toward large data sets with lots and lots of covariates and not a lot of structure with the ability to answer very structured questions,” she says.

Stanford business school professor Susan Athey (Peter Tenzer)

Because of her interest in the effect technology has on our lives, cryptocurrency immediately piqued her interest for its potential to disrupt financial services. I recently met with her at her office at Stanford GSB to talk about what digital currency is, its potential, the hurdles it faces and other related issues, including an exciting new project involving Bitcoin. Because of the length of our interview, I’ve separated them into individual stories in a series. In this first installment, we discuss what Bitcoin is and applications for digital currencies.

What is digital currency?

At its core, the new technology that’s been invented in the last few years is a way to maintain a ledger or spreadsheet that keeps track of who has what. So if there’s an entry in that spreadsheet that says a certain address has 10 bitcoins and you know that address and the password, you can authorize a new entry on the spreadsheet that moves that digital currency to someone else. So Bitcoin is just a big spreadsheet that keeps track of who owns what,  and what’s really innovative about it is that, first, it is secure. It uses decentralized maintenance of that spreadsheet, so there are copies all over the world. There’s not just one computer that can be hacked.

Second, the fact that it’s purely electronic means that if the spreadsheet says I have some bitcoins, and I have the key for those bitcoins, I can authorize a movement to someone else simply by entering my security code, which then immediately makes another entry on the spreadsheet and allows someone else to control this thing of value without any banks or companies or other types of middlemen. With just a password, I can almost instantly transfer something of value to someone else, purely digitally and without any promises from companies to honor it. It’s a piece of open-source software.

So digital currencies are a technological innovation for moving value digitally and securely and quickly, just like the internet was a fundamental technology for moving information somewhat securely and quickly.

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How might digital currencies change our everyday lives?

Like the internet, digital currency is a technology that enables lots of applications to sit on top of it. One thing that’s hard to do today is to move money internationally, especially quickly. If you useWestern Union WU -0.05%, there’s a large fee, and if you want to move money between two banks internationally, it costs you $60 or $70. For regular consumers doing small transactions, it’s often too expensive. So digital money makes it easy to move money at the speed of information rather than a week or longer.

Digital currency also makes it easy for anybody to move money between one person to another. There are applications today that allow you to do that, like Venmo, but there are fees to getting money in and out of applications, and these apps are not that broadly adopted. So I expect that either people will directly use applications built on top of digital currency to move money, or that competition from digital currency might induce banks and other financial institutions to lower their fees. There are actually a lot of countries in the world, where, if two consumers want to send money to one another, that money becomes immediately available to the receiver, and there’s no fee. But that’s not the case in the United States.

Where is this available?

Europe, Australia. Person-to-person bank transfers are free and instant in a lot of the world. So when you talk about the benefits of digital currencies to people in other parts of the world, they are surprised that they are not available to us already in the U.S.

Why not?

The backend system that banks use to send money to one another, ACH, is an old system coordinated by the federal government. It takes time for the banks to actually receive the money. There’s a delay built in. The cost the banks are charged is very low but the banks charge the fees to the consumers and they don’t always make the money available to consumers as soon as they receive it.

The banks still have a delay in Europe but they just go ahead and make the money available to consumers even before the money moves between the banks once they know that it’s coming. You might wonder, can’t Chase and Bank of America work something out between them? Can’t Bank of America check you have the money in Chase and Chase says they’re sending it and then make the money available to you? They could but they don’t.

Digital currency, by its very nature, makes that very easy, so if the banks don’t provide those services to us, we expect that services built on top of digital currency will provide those services, and that would hasten the arrival of those services. It’s just basic nuts and bolts competition.

Do you see it already happening?

What brings down prices is competition. Currently, all the banks charge these fees and impose these delays, so competition doesn’t seem to be working to bring the price down to cost. Competition from outside services might have that effect, but so far it’s been too small. Digital currencies haven’t been large enough to put price pressure on the banks, and the banks are making a lot of money from those fees. Fees are charged to consumers and businesses — even large companies. These fees are problematic for the efficiency of society because they make certain kinds of transactions cost-prohibitive or less productive.

It might be easier to just move money electronically but since you can’t do it instantly, instead you use cash. There might be small transactions, like in-app purchases or charges in an app store, where the credit card fee might be very large in proportion to the value of the transaction, so those just get priced out. If a newspaper wanted to do micropayment for content, then the credit card charges might be cost-prohibitive because there’s a fixed fee for every credit card transaction, so we see lots of types of transactions not possible in a system when you have to pay credit card fees or bank fees to process the transaction. What digital currencies do is remove a lot of these minimum fees and make it easier and cheaper to move small amounts of money.

What are some other ways digital currency will change our lives?

We’ve talked about sending money internationally, which could include person-to-person payments and remittances. Formal and informal remittances are maybe $1 trillion, so that’s a big application. We’ve talked about digital currency putting pressure on person-to-person transfers within a country, which today could happen quickly but don’t. And we’ve talked about a payment system, so a merchant could accept bitcoins for payment, bypassing applications.  So that’s four applications we’ve talked about.

People can also use the digital currency technology to create more complex contracts or instruments. For example, today people use escrow accounts when buying a house: You put money into escrow, but it only goes to the seller when the seller hands the title to the property to you. We use escrow accounts when we have trust issues around a big important transaction and we want the money to move at the exact same time the property moves.

But we only use that for big transactions because escrow is expensive. With digital money, you can write costless computer programs that create escrow services,  so I can put digital currency in an escrow account and have a computer program only release that money to a seller when certain conditions are met. You can call it programmable money: It’s money that we can write computer programs on, and these computer programs check when certain conditions are met. In situation one, the money gets sent to one person. In situation two, the money gets sent back to the original holder of the money. In situation three, it might go to someone else. We can write contracts that are enforced by a computer, instead of a relying on an escrow agent and paper signing and these horribly old-fashioned things. We can use escrow for goods of much smaller value and without interacting physically across borders.

People are also investigating using programmable money for financial contracts, like for instance, financial contracts in derivatives which involve multiple parties. You might put some money in a financial contract which will pay out according to what happens to certain stock prices. So you could have a computer program that took in as an input stock prices from the Bloomberg terminal feed and then, depending on what happens to certain stocks or certain combinations of stocks, certain individuals get paid back.

Like a buy or sell order?

Yes, but you could set up more complex derivatives that might pay out to certain people, as a complicated function of what happens to multiple stock prices. Derivatives are financial instruments that pay investors according to complicated functions of what happens to stock prices. For example, it might be a lot if the stock falls by more than a certain percentage, or not at all if it goes up.

People have proposed to create more complicated derivatives where any individual could make up a contract, and people all over the world could invest in them and the people would know a computer program would follow the rules of who gets paid when. So they could be complex multi-person derivatives, financial instruments, and instead of trusting an individual or an institution to make the payments according to the rules, the computer program would spit out the money to the right people.

A little more abstractly, smart contracts with digital money allow you to write a set of rules that tell you in what circumstances different people get paid. These could be very complicated contracts that could depend on lots and lots of prices and lots and lots of information and could involve people who don’t know each other or trust each other and live in different countries all over the world. All these people could read the rules of the transaction, participate and trust that the computer program would carry out the rules. So as long as everybody put their money in, it could be held in escrow by this computer program and they would know that it would get spit out according to the rules.

So it’s a substitute for people you paid like escrow agents and title companies or services that would be provided by a financial institution, where the financial institution would create an instrument, but you’d have to trust them to follow the rules and so only certain trusted institutions could convince people to give them money and trust they would give it out according to the instructions. Now this can all be done in a computerized way.

People are very excited about this possibility, but part of the reason this sounds abstract is that we haven’t seen a really productive use case. It’s just a possibility now. This is just like beginning of the internet. When I was in college, I’d say, wow, you could send information all over the world. I can write a message to my boyfriend. People would say, you’re sending email to your boyfriend? Why don’t you just call him?  People couldn’t understand why it would be so much more useful to email information than use traditional methods. In the early days of the Internet, people would say, yes, I can send messages through text and files, but they couldn’t envision YouTube or Twitter or Google. The applications that were going to come later weren’t completely clear.

Digital money is similar. The first thing you do with technology is do what you were already doing better and faster, like sending money internationally, sending money to our friends, paying for things on the Internet. Many people believe that the best is yet to come, and new things are possible, but we’re not sure which of those possibilities have the most value. We have this new technology that allows money to be allocated with computer programs according to specified rules. We haven’t quite figured out what to do with it, but it seems like a powerful technology.



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BitcoinEXPO 2015 in London

Crypto Currency

BitcoinEXPO

BitcoinEXPO 2015 in London to Focus on Startups and Investors

 

by Allen Scott 

BitcoinEXPO 2015 London will take place in the UK capital on January 24-25, 2015.

After the previous successes of the Central European Bitcoin Expo Vienna, the BitcoinExpo 2014 Shanghai, and the Bitcoin 2 Business Congress Brussels, the CryptoEvents team is now bringing you BitcoinExpo London 2015.

“The year of 2015 will begin in a grand style in London!”

—CryptoEvents team

CoinTelegraph is also proud to announce that it will be the official media sponsor of BitcoinEXPO 2015.

BitcoinExpo London

The conference will take place in the capital of the United Kingdom, London, on January 24–25, 2015.

The event will serve as a launch pad for speeches, debates, networking and exhibitions, as well as the first ever startups show.

Commenting on his experience at previous events, Bastian Brand of the Pathfinder Cryptocurrency Fund remarked:

“The organizers did a very good job to bring together the most important Bitcoin experts and entrepreneurs from Continental Europe.”

The BitcoinExpo 2015 will be particularly focused on startups and new technologies, which makes it the perfect venue not just for crypto users, professionals, startups, and investors, but also for anyone else who wants to discover and learn about the burgeoning Bitcoin economy and the rapidly expanding world of cryptocurrency.

The speakers confirmed so far include:

Startups at any stage of development are welcome, as the event will  offer an opportunity to showcase the ideas behind new startup companies, as well as to discuss and find potential opportunities for your business to get the funding you need.

Speakers of BitcoinEXPO 2015 London

Tickets

The £99 startup ticket will give you the opportunity to present your project to investors during the BitcoinExpo 2015’s Startup Show. Venture capitalists, investors, entrepreneurs, and big businesses are also encouraged to attend.

It is free to attend the conference. Early-bird registration is required, which will grant you full access to the exhibitors’ floor. You can also buy an attendee VIP ticket, which will guarantee you the best seats in the house. The price for a one-day VIP ticket is £109; a two-day ticket costs £129.

All attendees can register for free. Purchase tickets if you are a startup or investor here.

Tickets can be purchased with either Bitcoin (via BitPay) or credit card.

Don’t miss your chance to be a part of this conference. See you all in London!

For more information, go to: www.bitcoinexpo2015.com and www.cryptoevents.net


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Agora Commodities Will Rebrand to Focus on Bitcoin

Crypto Currency

Bullion Dealer Agora Commodities Will Rebrand to Focus on Bitcoin

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Agora Commodities

Precious metals dealer Agora Commodities has announced that it will rebrand to emphasize its increasing interest in digital currency.

The company expects to adopt the name Crypto Bullion Group, a process that will include the launch of a new online platform. Crypto Bullion Group will continue serving precious metals customers that want access to bitcoin.

The move continues Agora’s long-standing involvement in the digital currency industry, which in recent weeks has inspired the company to forge partnerships with other precious metals-focused startups like crypto 2.0-powered bitcoin-to-gold exchange DigitalTangible.

CEO Joseph Castillo told CoinDesk that rebranding affirms what he called the company’s growing focus on bitcoin. This process, he said, grew out of the grassroots support of customers and advocates.

Beyond rebranding to demonstrate what he called the company’s “philosophical grounding in bitcoin”, Castillo said that Crypto Bullion Group is actively moving to utilize the technology not just as a currency but as a mechanism for smart contracts and transactions.

He added:

“We’re committed to the idea of the implementation of bitcoin beyond just a source of revenue.”

According to the company, the platform is still underdevelopment, and while there is no set date in place, Crypto Bullion Group hopes to launch before the end of the year.

Focus on cryptocurrency

Castillo said that the rebranding will allow the company to provide a resource for precious metals collectors and investors who want access to bitcoin while, in turn, enabling broader adoption of the technology in general.

Commenting that many other companies are tapping bitcoin as “just another revenue source”, Castillo said that an increased focus on digital currency would enable Agora to more directly support the bitcoin ecosystem as a whole.

He told CoinDesk:

“Rebranding is just a reaffirmation to our commitment to bitcoin, and a thank you. This new technology has created wealth for us and a new service, and we just want to make that our focus.”

“Not that we are going to stop taking US dollars,” he added, referencing competitor Amagi Metals’expected transition to take place by 2017.

Interest in crypto 2.0 capabilities

Notably, Crypto Bullion Group is looking into advanced bitcoin protocol applications in the form of smart contracts. While this process is still in the conceptual stage, Castillo shared insights into how crypto 2.0 processes could be integrated into the precious metals business.

Castillo said that he and his team are looking at how the bitcoin blockchain can be leveraged to both build greater trust among investors and create decentralized contractual mechanisms that reduce costs and reinforce agreements through the use of bitcoin’s globally distributed ledger.

He cited the colored coins project as one concept his team is looking at, noting that a recent meeting with that development team was promising. Ultimately, the company’s goal is to build new tools to make their business run more efficiently, which he sees as a key promise in bitcoin itself.

“I don’t think people are looking at the protocol and thinking, wait a second, there’s more at work here. We can do many more things with it,” he said.

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BitFury Group

Crypto Currency

 

BitFury

Samsung Electronics President and CSO Young Sohn Joins BitFury’s Strategic Advisory Board

by Diana Ngo @ 2014-11-25 12:01 PM

Bitcoin infrastructure provider and Bitcoin transaction processing startup BitFury Group adds Samsung Electronics President and Chief Strategy Officer to its strategic advisory board.

BitFury CEO Valery Vavilov stated in an official announcement:

“We are excited to welcome Young Sohn to our strategic advisory board which is composed of some of the most distinguished technology and venture industry leaders.”

Sohn is joining BitFury’s advisors board, which was initially composed of semiconductor industry veteran Dr. Jackson Hu and Binary Capital founder Jonathan Teo. Vavilov also noted that:

“Young’s extensive experience in semiconductors and consumer electronics will enable us to explore business opportunities in the consumer electronic devices market.”

Sohn has been working as President and Chief Strategy Officer for South Korean multinational electronics company Samsung Electronics since mid-2012. Previously, the executive had served as CEO and President for multiple enterprises including public companies Quantum Corporation, Oak Technologies, Agilent Semiconductor, and Inphi Corporation.

Young Sohn

Sohn shared his excitement in joining BitFury’s team and in supporting the startup’s ambitious goals. He stated:

“BitFury is well positioned with its custom design chip and data center technology. The company’s commitment to delivering results through strong and consistent execution of its business and growth strategy has not only allowed BitFury to become a highly respected global Bitcoin company, but to also see new opportunities.”

Founded in 2011, BitFury Group is a leading provider of semiconductors, servers and datacenter solutions to the cryptocurrency industry. The startup is currently constituted of an international team of 70 professionals located in San Francisco, Amsterdam and Riga.

In May, BitFury Group closed a US$20 million funding round from VC firms, which included Binary Financial, Crypto Currency Partners, Georgian Co-Investment Fund (GCF), Queensbridge Venture Partners and ZAD Investment Company, as well as renowned angel investors Bill Tai and Jonathan Teo. The investment was said to build out its facilities in strategic international locations and accelerate its production of next generation semiconductors, or ASICs and servers.

In early September, the startup announced a partnership with Bitcoin security and multisig leader BitGo. The partnership included a significant undisclosed investment into BitGo. Last month, BitFury made another similarstrategic investment into payment platform GoCoin, which was then selected to process digital currency payments for BitFury’s vendors.


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Blockchain Factory

Crypto Currency

 

Blockchain Factory

Blockchain Factory Is Creating The Tools For Today And Governance Services For Tomorrow

by Ian DeMartino @ 2014-11-24 06:51 PM

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Art by: Jing Jin

Last month we brought you an interview with Nathan Wosnack, David Mondrus and Matt McKibbin, who had left the crowdfunded Bitnation days before the launch of its crowdsale due to concerns over transparency, customer/investor protection and potential regulatory issues. Last week, we caught up with two of the former Bitnation members, Nathan Wosnack and David Mondrus, to talk about what they are doing now.

While they never came out and said it, their current projects seem to have been born directly from their experiences at Bitnation. Wosnack has started a company, uBitquity, that focuses on “PR/Media, Advisory/Development, and Compliance Services (AML/KYC manual dev and consulting).” Which shouldn’t be surprising considering his concerns over the potential legal issues he fears Bitcoin 2.0 projects may be running headlong into.

Of more interest to Bitcoin users is what he is working with Mondrus on, Blockchain Factory. Blockchain Factory is a company that, along with various tools designed to make navigating and using the Blockchain more accessible, also is building some projects that are very much in line with what Bitnation is offering.

But, it is also no mere imitation. Blockchain Factory isn’t trying to be the “other” Bitnation, and their short term goals with government services are less lofty and more lighthearted. Blockchain Factory doesn’t so much plant to replace your current government as much as it gives people the tools to add supplementary services using the Blockchain. That is essentially the same goal of Bitnation, but the feeling isn’t that they are coming to create “Governance 2.0” or at least not right away. They are both borderless, decentralized and voluntary services, but the difference is in tone and Blockchain Factory seems willing to take it one step at a time.

The feeling I got speaking with them was that the Blockchain Factory’s governance services, at least in the early stages, aren’t designed to make Bitcoin-citizens, but simply offer up alternatives for services that may or may not be offered by their current government. Citizens in the U.K. are used to supplementary health insurance. Why not supplement marriage or pass ports or notaries with the verifiable security of the blockchain?

A particular point of pride with them is how Blockchain Factory is being funded. As of now, there is no Blockchain Factory coin (although a coin is coming, it isn’t a share or pay any kind of dividend and details are scarce at this point), no IPO or ITO or ICO or whatever people want to call it today. Instead, they are going to traditional route, self-funding the project and bringing in select outside investors. They don’t hate the idea of crowdfunding or even crowdinvesting, but they do have concerns about the legal ramifications and how distributing a company, regardless of what you call it and the reaction of U.S. regulatory bodies.

We spoke about their upcoming projects, their concerns about crowdfunding and the future of governance services on the blockchain.

Why don’t you start with telling our readers about what you offer.

Nathan Wosnack: We offer Blockchain Development, Crypto Consulting, Crypto Project Management, Identity Management. Our main products are: Mining Slicer, BTC2MySQL, BitzME. And in the near future; BitMarriage, BitDeeds, [and] BitNotary.

Our unofficial slogan is “Let the Crypto Revolution Begin…” I do believe we are in the midst of a crypto revolution, and I’m happy to be part of it with Blockchain Factory, and with my partnership via uBITquity (my company out of Vancouver BC, Canada)

David Mondrus: Except, we’re not calling them BitMarriage, we are still working on the branding. But the idea is a cohesive set of governance services on top of an extensible framework. But, this is a long term goal and will depend of course on financing.

Nathan Wosnack: And with real proof of concept code to go along with it and no crowdfunding.

Perhaps we should go through each of the features one at a time. I’d like to start with BTC2MySQL.

Nathan Wosnack: As you know traditional tracking of a transaction on the blockchain requires digging through a plethora of addresses, keys and identifiers (i.e. transaction id, sender/receiver, change addresses) which can be arduous and very time consuming for people.

BTC2MySQL takes blockchain transactions and arranges them in an easy to query relational table. Now you no longer need to map out an entire transaction in your mind as it is all done for you on screen on our web-site with simply using SQL commands.

Who do you see as the target market for it? It seems like journalists and criminal investigators (private and public) would have a huge use for it, but are there other markets you hope to tap?

David Mondrus: There are two I guess. Forensic research is one, so that’s investigators both professional and amateur. The second is hobbyists and researchers. At the moment, we have a 100 row limit, but when we develop the premium version of the site we’ll do larger downloads, exports, etc. to make it easy to get the data out in a format more people are comfortable with.

Yeah, I can see how that could make my job easier when I’m trying to look into things.

David Mondrus: I was talking about it on FB one day and people expressed an interest, so we wrote it.

Nathan Wosnack: Definitely. And to be clear, we’re neutral about who uses our service. So long as they’re lawful in their activities.

Any other major features for BTC2MySQL [other than following a transaction]?

David Mondrus: Select * from join on … etc. That’s it for now, we’re moving on to BitzMe next and we’ll circle back to premium features when there is demand/funds.

Nathan Wosnack: For anyone who comes to our site and is confused about what to do, if they check the FAQ there is a link to SQL command help.

Speaking of BitzMe, that is really interesting too. It forwards all your cryptopayments to one address. The first question I have is: What are the “major” cryptos that will be supported? Do you have any that you can confirm at this time?

David Mondrus: so this isn’t a “crypto” specific product. So, we’ll support as many crypto currencies as we can, likely the Cryptsy set. But we’ll also support Paypal, FB Credits, Visa, Checking account. BUT, this is not integrated with a wallet, so don’t get excited. It’s a dir service, a payment page to rule them all (although the wallet integration is a good idea).

Nathan Wosnack: With traditional addresses people find them hard to remember, they expire very often, and they’re impossible to change once the address is posted. BitzME are easy to remember, it never expires, and you can change the payment methods as often as you need to.

So, let’s say someone sends me an obscure coin, when I want to collect that, how would I do it?

David Mondrus: well, when you set it uip, you have to tell us your wallet address, so at that point you’ve [already] got the wallet.

Nathan Wosnack: BitzME is an address shortcut for Bitcoin and crypto currencies (think bit.ly). When your wallet address changes, it is recommended as a good rule of thumb that you change your address on every single transaction – resulting in a link that is no longer valid. By simply using Bitzme you can leave your tip information on the Internet and not worry about it becoming obsolete and then losing payments. Since crypto currencies are irrevocable you can count on those payments being lost forever. So instead of “3J98t1WpEZ73CNmQviecrnyiWrnqRhWNLy,” you will be bitzme.com/satoshi

Can you use an exchange wallet addresses?

David Mondrus: Sure, we don’t care.

Nathan Wosnack: In fact we welcome it!

Awesome, so someone could use that to open up donations to pretty much everything, without having to download or find a web wallet?

David Mondrus: Well, it does rely on the wallet actually being there, but you can certainly populate from all your Cryptsy wallets and manage it all from one panel.

It’s launching November 28nd, will that be a full release to a private or public beta or something along those lines?

David Mondrus: Hopefully, the 29th. But it’ll be a public beta.

Nathan Wosnack: It was the 22nd and we postponed it until the 29th due to being busy with paying clients for the Mining Slicer and other contracts, and also we want to make sure that Bitzme is working in the way we want by that date. Hence the slight delay.

Will most of the features be available?

David Mondrus: The first subset will. Cryptsy integration won’t be there and no wallets either, it’s an MVP.

Nathan Wosnack: Early beta release, but we’ll have many updates as we progress. We’re a small team, and we do have some volunteers for beta testing, and outsourced staff available to help with our development, along with contractors for design. Under promise, over deliver. That will be our motto.

What about the Mining Slicer?

David Mondrus: The mining slicer is a fork of the CGMiner code that allows you to break up a large ASIC into smaller components. So, say you ahve a 2T (Th/s) machine. You can point that entire 2T to the BTC blockchain and make some money, or you can point it to something like Mazacoin and run a 51% attack; not a lot of good choices. But mining slicer allows you to take that 2T and turn it into 2000G (Gh/s), and you can point each of those 2000G’s independently. So, 1 here, 50 there, 200 over there, etc … They will all work on their respective jobs, and they are all statistically independent.

Obviously, that has some great uses. I am wondering though if someone would be able to break up their 2T, but then still point it at one network and perform a 51% attack without people noticing that one party has most of the hashing power?

David Mondrus: Sure, but that’s not really something we can control. Hypothetically, you can take a little BFL mini and run a 51% on a very tiny coin.

Nathan Wosnack: We definitely condemn that behavior. 51% attacks are unethical and generally frowned upon in the community.

Nathan Wosnack: So our clients and interested clients for licensing have obviously been cloud mining companies.

David Mondrus: But, it also works well for large independent installs.

I noticed your site doesn’t list pricing. I assume there is a reason for that, but would you want to reveal a rough idea on what customers can expect? Would it significantly impact their ROI?

David Mondrus: No, we aim to always stay within the profitability window. For that reason our pricing is client specific

Nathan Wosnack: We do a call, and try to figure out the customer’s size and needs before giving a proposal based on our pricing. As David pointed out, it is client specific. We want to be flexible and fair so we scale with each mining operation.

You are planning some government services stuff. Obviously this is going to compete on some level with your former employer/company Bitnation. Do you think we will see several technologies offering governmental services and do you think that is a good thing or a bad thing?

David Mondrus: Yes, I do and I think it’s a great thing. The problem is monopoly and a monopoly leads to bad customer service. So, the more companies there are in this space the better. As a matter of fact, the idea is that we’re a platform offering basic “core” services and an API and allowing others to build on top of that.

Nathan Wosnack: I think it’s a good thing. So long as it’s consensual, someone can opt-out of it or in it at their leisure, and any use of “governance 2.0″ services are without the use of force or taxes being used to facilitate it.

David Mondrus: You know in the same way that you used to have just one job most of your life, you also used to have one government, but these days that’s not really true. Aside from all of the border changes people migrate more and more. If you could have the same data, in the same format, recognized world wide, that would be a plus and there are many use/cases where it becomes obvious how useful this is, from Nathan’s passport debacle to Joyce and mine deed ownership to our “official” marriage records. They would all benefit from an world wide available, immediate recognition veracity guaranteed storage.

Could it potentially help solve the problems that cause those aforementioned inconveniences? Like, if passports were done on the blockchain, it would be easier for security institutions to prevent terrorists from traveling.

David Mondrus: Well, it’s more like if they’re on the blockchain then if you lose your passport it’s easier to recreate one. Hypothetically it could be in your phone (although of course that’s a long ways away due to recognition issues).

Nathan Wosnack: I lost my business stamped Canadian passport at the hotel at Coins in the Kingdom, then the lovely staff found it. But in between then I was told I would have to fly to Miami and wait a minimum of 3 days in order to get this cleared up. With services like “BitPassport” (name pending) one could utilize the power of the blockchain to verify who I am, based on my WoT (Web of Trust). IDCoin by David Duccini (“The Little Duke”) has a great whitepaper on Web of Trust and reputation and ID systems. https://github.com/IDCoin/IDCoin.

David Mondrus: so we’re going to start by making fun, “gamefied’ experiences based around for example Bitmarriage to generate excitement and traction. Then over time we’ll try to influence existing law similar to how Uber and AirBnB are doing.

Nathan Wosnack: I could see institutions integrating PEP (Politically Exposed Persons) and Anti Terrorist databases to reference a bitpassport type system with existing software like WorldCheck. AML/KYC firms could definitely take advantage of this as part of their services. I know I would with uBITquity and my partners at BitComply would likely enjoy that extra functionality.

What different government functions do you think could be handled in this way? And could high level functions, like Healthcare, be done on the blockchain?

David Mondrus: So, the idea of medical records on the block chain is an obvious one. The trick is in integrating with existing laws, regulations and systems.

So, what turned you away from crowdfunding / crowdinvesting in general and do you think its something you may utilize in the future?

Nathan Wosnack: We are strong believers in traditional fund raising. Having a prospectus, a pitch deck, reasonable projections. And a solid foundation so we can give a good ROI for our investors and shareholders.

David Mondrus: Investors, esp early investors, bring more to the table than just money. Their connections, networks, experience, all play a key role, especially early. Also, many of the successful ICO’s this year were directed towards the industry (Bitnation being an exception). Since we’re trying to bridge that gap between the crypto and the RL world, an ICO would be less successful IMHO.

We want to avoid stepping on the toes of regulators, and following the letter of the law. Crowdfunding at this point is not the best direction to go.

David Mondrus: We won’t rule it out in the future, but we want to make sure its’ 100% legal, and that takes time, traction, and etc …

Do you think the legal problems will be an issue for IPO/ICO/ITOs in the future?

David Mondrus: Yes

Nathan Wosnack: Yes.

David Mondrus: In the past, the model has been to pretend, or act as if the regulations don’t matter. But, while “you can avoid reality, you can’t avoid the consequences of reality” (Ayn Rand), as I’m afraid many people in this space will find out in 2015. The arm of US law is very long and has a very old memory. I have no intention of being on the wrong side of that line

Nathan Wosnack: The song “No where to run” by Martha And The Vandellas comes to mind.

The FEDS love making examples of people. And they have unlimited funds backed by taxes the hard working men and women of the United States of America. The SEC definitely considers that a security. And if someone is selling unregistered securities to unsophisticated investors, they should expect to be held accountable for that behavior. Know the risks, uncertainties before investing. The same goes for anyone in the space looking to do an offering of this type. Get legal counsel and look before you leap.

That said, we’re not saying be overly conservative. The crypto space is about innovation and taking risks. Just know that the risks you take won’t have negative consequences that could land someone in prison or fined.

Final question: You are working on BitMarriage, what about BitDivorce? 

David Mondrus: I prefer not to handle “bitdivorce”. As I say, a marriage is a promise. A divorce is a contract. So, I can see divorce contracts happening when assets are on the blockchain, but that’s still a bit of ways away.

Nathan Wosnack: I’ll handle BitDivorce. I’m jaded about relationships right now anyway!

We want to thank Nathan and David for taking the time to talk to us. You can find more out about uBITquity and Blockchain Factory and their official sites.

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Bitcoin 2.0: Sidechains, Ethereum And Zerocash, Oh My Now Exactly what

Crypto Currency

Weird, interesting, and also extremely enthusiastic factors are afoot around the world of Bitcoin as well as blockchains. I give you Zerocash, a completely confidential money; Ethereum, a blockchain platform developed to decentralize much of the Web; and also sidechains, a proposal to accelerate the progression of Bitcoin itself. Any type of one of these could understandably end up being a large deal. All three? Puncture up your ears.

Of Bitcoins And also Blockchains

If you’re not au fait with blockchains, your head might already be swimming. Some background: Bitcoin, the notorious cryptocurrency, is improved a new sort of distributed-consensus modern technology called a blockchain, which permits purchases to be securely saved and also validated with no central authority whatsoever, due to the fact that (to oversimplify) they are validated by the whole network.

Its success has spawned scores of alternative cryptocurrencies, referred to as “altcoins,” one of the most famous which is Dogecoin. Yet Bitcoin continues to be, by far, the big canine.

If you control majority of the computations that power any type of cryptocurrency, then you could spend the same cash more than once: a “51 % attack.” Altcoins are especially vulnerable. But the sensational quantity of computing power being poured into the Bitcoin network makes it (most likely) successfully unsusceptible such an attack, as each this mindboggling chart from blockchain.info–.

BTChashrate.

The Bitcoin mining network is currently executing some 3 hundred quadrillion hash calculations per 2nd to protect and verify Bitcoin transactions. (If you think that’s ecologically inefficient, compare it to gold mining.) On the other hand, even with its much-publicized decrease of late, Bitcoin still has a cumulative market capitalization of nearly $5 billion, twice exactly what it was a year ago.

Why You Ought to Treatment.

Bitcoin is simply mildly interesting as an establishment of value; there are many great options. It’s additional interesting as a means to move money to anywhere and also anybody, with greater rate and also reduced deal fees than most options, with no ID requirements.

Yet it’s actually fascinating because it’s the world’s very first form of programmable money.

Many people do not value that Bitcoin sustains a simple scripting language which can manage deals. (As a matter of fact all purchases in fact run as manuscripts.) This language already sustains cases such as: down payments that instantly revert after a time period, escrow transactions, purchases which count on some exterior problem (albeit in a complex means that calls for a third-party “oracle”), and also more.

Just what are all of the prospective applications of completely programmable cash? Especially if the capacities of that scripting language are expanded? I do not know, and neither do you. It’s the proverbial whole brand-new ballgame.

But development is challenging. Bitcoin is the only cryptocurrency powered and also protected by a really giant mining network, yet due to the fact that it deserves so much, as well as its network is so widespread, adjustments to Bitcoin itself are always promoted extremely slowly, as well as testing is finished with extreme tentative caution. So we could experiment with new type of blockchains as well as cryptocurrencies (like Ethereum and also Zerocash), or we can rely upon the worth, deficiency and (technical) stability of Bitcoin, however we can not do both. Right?

… Wrong, says Adam Back.

Sidechains: Back, Hill, and also Blockstream.

The “three hundred quadrillion hashes” discussed up above describe attempts to please the Hashcash proof-of-work function that Adam Back developeded way back in 1997, utilized today to verify Bitcoin transactions. Now Back is back with a new proposition: sidechains, which would permit Bitcoins (as well as other blockchain properties) to be moved in between blockchains.

Back and also co. are not behaving purely from technical generosity. He as well as a team of co-founders, including a number of core Bitcoin designers, moved by previous Zero-Knowledge Equipments Chief Executive Officer Austin Hillside, have actually a released a start-up called Blockstream. According to Coindesk, they have actually already increased $15 million in a recurring financing round, and included Reid Hoffman to their board. Their specific business remains strange, however is constructed around sidechains. (The sidechain code itself will evidently be open-source. See Blockstream’s recent Reddit AMA.).

To price quote the sidechains white paper (PDF):.

The development of independent yet essentially similar systems is troublesome … one of the most visible projects might be the least practically audio … dissuades technological innovation while at the same time encouraging market video games … We desire a globe in which interoperable altchains could be conveniently created as well as utilized, however without needlessly fragmenting markets as well as development. In this paper, we assert that it is feasible to simultaneously obtain these seemingly inconsistent objectives … individuals do not should be as concerned that their holdings are secured a solitary speculative altchain, because sidechain coins could be retrieved.

To estimate, emergency room, myself: “You could in principle have hundreds of sidechains “secured” to Bitcoin, all with different features and also functions … and also all of them benefiting from the shortage and durability ensured by the main Bitcoin blockchain, which then might iterate to execute speculative sidechain attributes once they have been tried and tested.”.

Blockstream has several various other influential followers, including Vinod Khosla as well as Gavin Andresen, main researcher of the Bitcoin Structure (that likewise just recently did an AMA):.

Certified-Bitcoin-Coach



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UK OK Bitcoin: Brit merchants go for cryptocurrency despite doubts

Crypto Currency

Governments across the world have been quick to denounce the boom of the virtual currency bitcoin, citing fears that criminals are embracing the independent …

Wanna know where can I buy things with Bitcoins? Visit http://tinyurl.com/WhereCanIBuyThingsWithBitcoin and you’ll learn all the secrets about Bitcoins! http…
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What is Namecoin Bitcoin’s First Fork

Crypto Currency

What is Namecoin Bitcoin’s First Fork BITCOIN PRICE , BITCOIN FUTURE in doubt http://youtu.be/eO-yrpQpIT8 What is NAMECOIN BITCOIN’S First Fork http://youtu….
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