Category Archives: Crypto currency and Bitcoin news

Overall Crypto Coin Market Expanding

Crypto coins are a beast of its own. Attempts have been made to classify Bitcoin and other peer-to-peer decentralized Crypto coins into one asset class or the other. Some analysts (and alongside them, a number of online trading platforms) believe Crypto coins should be seen as part of the Forex market. Others would like to see Bitcoin and Alt coins as a tangible asset and part of the precious metals market. Neither of these attempts are convincing though. The truth is that, while having some similarities with others, Crypto coins are an asset class of their own.

With other coins beyond the original Bitcoin establishing themselves firmly in the overall market and gaining increasingly significant market share, the argument for seeing Crypto coins as an entire “asset class” becomes more convincing by the week. Besides Bitcoin itself, circulating since early 2009, other peer-to-peer Crypto coins have appeared. The first to follow was Litecoin (ticker: LTC) launched in 2010 and improving on a number of Bitcoins experimental features; most importantly faster confirmation (total transaction) time, a better block size capable of processing a sufficiently high number of transactions, lower energy consumption, and a dedicated and publicly known development team and lead developer. Similar things can also be said about DASH, the innovative and privacy-conscious digital cash (ticker: DASH), Z-Cash (ticker: ZEC), Ethereum (ticker: ETH),  Monero (XMR), or Ethereum Classic (ticker: ETC) — all of which have gained significant market share and range from around $300m to $4bn in market capitalization. This is additional to Bitcoin itself (ticker: BTC) which has a market capitalization of over $19bn at the time of writing.

While these market capitalization figures vary widely for specific coins in the top-15 of today’s peer-to-peer decentralized Crypto coins (or simply that new “Bitcoin world”), the most significant aspect is that the overall capitalization of those top-15 Crypto coins is a combined $27.5 billion, and counting. (This figure of the top-15 Crypto coins is up from roughly $7.8bn year-on-year.)

Ripple as a rather proprietary and not truly decentralized token with its $1.2bn market value is not even included in this figure because, unlike the other Alt coins above,  Ripple does not really count as a “Bitcoin flavor”. (It remains to be seen if Vitalik Buterin’s policies for Ethereum will lead ETH in a similar direction and exclusion from “real” Crypto coins.)

With Bitcoin (BTC) having increased in price for most of the current year and currently trading  above $1250, price gains of all the other coins are even more impressive as they clearly do not come from movements between Bitcoin and other Crypto coins but rather from an influx of new money into the Crypto coin asset class.

This includes current demand from investors following more conventional investment styles and accompanying newsletters. It appears to be time for them to jump on the Crypto coin bandwagon in order to profit from possible price gains as this overall asset class evolves and matures. The resulting increase in demand for at least the ten or twenty top-tier Crypto coins has resulted in significant price gains against all fiat currencies like dollars, pounds or euros over the last weeks and months.

Litecoin (LTC), Ethereum (ETH), and DASH (DASH) have seen the highest price increases while proving to be most stable and not as extremely volatile as some other smaller-cap Crypto coins.

Additional fundamental factors for these coins are adding to market expectations of further price increases as these coins are set to fill an increasing number of market niches opening for coins with special features going beyond Bitcoin’s original abilities and uses.

The Top Six Reasons for Using Bitcoin, Alt coins

Bitcoin, along with all other decentralised peer-to-peer Crypto currencies, has a number of significant advantages going in favour of using it. These range from being free from “political risk” (national currencies) and “counter-party risk” (paper assets held at banks or brokerages) to providing some degree of financial privacy (not anonymity though unless additional measures are implemented), giving its owner back the control they deserve over what’s rightfully theirs.

The pros for using Bitcoin, Litecoin, Dogecoin, or any other P2P Crypto coin are summed up in the list below.

  • Bitcoin has value of its own due to steadily increasing worldwide demand
  • Bitcoin cannot be shut down due to its structural nature of decentralisation
  • Bitcoin cannot be — and never has been — “hacked” due to the secure nature of its underlying cryptographic technologies
  • An increasing number of countries are reckognising Bitcoin’s legality and general utility for economic and/or technical development
  • Bitcoin has proven legitimate simply by the fact of user adoption by hundreds of millions worldwide
  • In a world of high political risk and troubled banks internationally, Bitcoin as a new and wholly independent asset class provides an additional option

The Bitcoin Financial Revolution

More than its unit price against dollars, Bitcoin is of interest for reasons quite different from just speculative profits (or losses) from its infamously volatile movements.

First and foremost, the mathematical achievement of solving the “Byzantine General’s Problem” in the process of inventing the blockchain as Bitcoin’s underlying technology is Bitcoin’s most outstanding achievement.

At the same time, the economic potential opening up because of Bitcoin and this overall  breakthrough in decentralization and organizational opportunity flowing from it is what really will matter in a greater context. Having a decentralized ledger is what makes worldwide Bitcoin transactions possible. It has also allowed setting up numerous other decentralized peer-to-peer Crypto coins. Roughly two hundred to three hundred coins similar to Bitcoin have come and gone as of this writing. These alternative or Alt coins use decentralized ledgers similar to Bitcoin’s blockchain. In the case of Alt coins, these are often called block indexes, and Alt coins use the same or one of a number of different encryption algorithms. The underlying technology of Alt coins is largely the same used in Bitcoin though. This entire enabling technology will prove to be a major enabler whose true potential has not even been realized by most people, including many Bitcoin aficionados. It holds the potential for directly bringing together random people from all corners of the world without any middleman (or institution) in order to engage in trade or any other form of exchange.

Once this truly powerful concept has been fully grasped by all involved in the Bitcoin and wider Crypto currency field, it will not really matter what the actual price of one Bitcoin in dollars or similar is at a particular date. True, early adopters of Bitcoin or other Crypto coin, more specialized for a certain use case, will profit from accompanying price increases if they manage to get in and out at the right time. In light of what an actually free market for worldwide exchange of value could mean, short-term profits may be a “nice thing” for sure, but the overall benefits to all present and future Crypto coin users will outweigh these by far.

Misconceptions About Blockchain Technology and Bitcoin

There is a fundamental difference between the open and decentralised Bitcoin system and all other projects — whether in industry or government-backed ones — that are now claiming to “discover Blcokchain technology”, albeit 5+ years later than Satoshi Nakamoto…

These days, every would-be innovator and their grandmother believe it is “posh” to “do Blockchain technology” or what they believe to be it.

The most ridiculous attempt (so far) came out of that great City, where the Bank of England has ridiculed itself by presenting their shallow idea of “RSCoin” while claiming that this would be a “better Bitcoin”. Curiously, they have been echoed by some puppet newspapers in Britain who were fast to applaud the idea and “explain” why RSCoin, for being “backed by the trust of governments”, would be a “so much better Bitcoin”. Those explainers have only discredited themselves as to neither understanding Bitcoin technology nor doing proper news research (which would have shown why a scheme like that is stupid right away).

They should understand — or at least research until they do understand — that Bitcoin’s strength stems from solving the Byzantine General’s Problem and that this discovery is at the heart of Bitcoin technology as well as every other decentralised Crypto coin’s technology. Satoshi Nakamoto’s discovery is what made Bitcoin possible at all.

Bitcoin sacrifices a certain part of ledger efficiency for the sake of real-life decentralisation. This is made possible by using an autonomous and truly decentralised Blockchain recording Proof-of-Work calculations performed by miners who are also autonomous. As and added security feature, they are also anonymous. That way, they provide for a global, autonomous, censorship-free, and secure network.

If these features are not needed, then why use “Blockchain” technology in the first place, wasting efficiency features without any real need?

What “RSCoin” and similar not properly thought-out schemes are proposing is, in fact, a single-entity clearinghouse (run, not surprisingly, by the Bank of England in this case). The Bank of England apparently believes to be gaining some institutional advantage by pursuing this ridiculous venture, all the way failing to understand what it is they are really doing.

“RSCoin” is nothing more than a scheme built around a single-entity clearinghouse. A structure like this is known to be extremely vulnerable against all kinds of attacks, and it has already been said that cracking into this “would be a lot of fun”.

Bitcoin experts are also on record saying a single-entity clearinghouse is a ridiculously anachronistic and insecure idea that should have died two decades ago.

That would have been in the mid-1990s. The City of London’s “finest” are trying to build it now, in 2016, though. Funded by taxpayer money at that. They are also applauded by those parts of the British press even more stupid than that.

Well done.

 

“RSCoin”: BoE Now Laughing Stock of Tech Experts Worldwide

The Bank of England has announced it is planning its very “own” Crypto currency, called RScoin.

The coin would be “so much better than Bitcoin” for the alleged advantage of being “backed by the trust of governments”. Exactly the “assurance” everyone needs these days.

Proving to know little more than what some central-bank controlled press office has fed them, Britain’s Daily Telegraph writes on what is actually just the latest wet dreams of the banking elites in a poorly researched article, http://www.telegraph.co.uk/business/2016/03/13/central-banks-beat-bitcoin-at-own-game-with-rival-supercurrency/. Just like the BoE itself, The Daily Telegraph has failed to understand what they’re actually doing, or talking about respectively.

If you want to read something really stupid about the very central bankers responsible for 2008’s economic crisis, then you might want to read that article. No one there is even getting the first thing about Bitcoin’s true innovation for being trustless and peer-to-peer decentralised in nature. The article entirely fails to even scratch on the implications of Satoshi Nakamoto’s solving the Byzantine General’s problem and thereby succeeding with managing distributed consensus for the first time in history. As every mathematician or computer scientist will confirm, this is the actual importance of “Bitcoin” and “Blockchain technology” though. Introducing some central-planners-controlled “RScoin”, the Bank of England’s latest brain fart, proves to only be yet more of the same: namely another attempt of the state at humanity, at freedom, and thus at everyone of us — backed by yet more state-control, central planning and government power. It also proves that governments are having a very hard time moving beyond the technological level of horse-drawn carriages and gunpowder.

With the alleged “trust” of RScoin, sold to us as an “advantage”, the real trouble proves to be the lack of this very trust when people are supposed to put it in governments once again, and after  governments and banking elites have empoverished the world for much more than merely the Federal Reserve’s 103 years of existence now.

At least, a “competing currency” RScoin is though. So let us see how this will play out. Let us see how, and if so, it really can compete with Bitcoin and Alt coins at the end of the day.

PPC (Peercoin) Advancing Further

Peercoin, the first proof-of-stake Crypto coin, is advancing further in price both in US dollar terms and against bitcoins.

Earlier today, peercoins traded over $.49 and around BTC .0012500 on many Crpyto coin exchanges, while briefly hitting 150’000 satoshis (BTC .00150000) on Malta-based Bitcoin exchange “The Rock”.

This development is quite in line with earlier expectations of Peercoin being under-valued (read our earlier report http://bitcoinfinancial.info/litecoin-and-peercoin-may-be-undervalued-now/ of 20 Feb 2016).

Peercoin had reached and exceeded the BTC .00150000 level briefly in January on Cryptsy before the troubled exchange’s breakdown, but that notation (topping at 159’0000 satoshis) had to be taken with a grain of caution. So whether or not the BTC .00150000 mark is of any technical significance may be uncliear in light of the nature of Cryptsy and the goings on around that outfit.

If today’s BTC .00150000 price at The Rock is exceeded, this would mark a possible breakout of Peercoin to the upside, a development that has gradually been preparing and building for Peercoin over the last few months.

Latest BTC Price, as reported on Coinbase

Bitcoin Price May Be Getting Ready for Next Fundamentals

The price of Bitcoin to the US dollar and other paper currencies has been taking a breather during the last days, apparently in the wake of a technical short-term move to the upside in major stock markets.

Bitcoin and other Crypto coin prices powered ahead strongly during the first week of trading amidst uncertainties over stock prices and the worst start on record into a trading year for stocks. Particularly with stock investors in China fleeing the conventional markets and open to unconventional ones, Bitcoin and other Crypto coins were up quite significantly. Notably, this includes other Crypto coins than just Bitcoin and Litecoin like Peercoin, Dogecoin, and Earthcoin. The latter appears to grow into some kind of a darling among the Chinese and, as a result, has been moving quite in line with local developments there for the previous months and throughout several Asian stock market setbacks.

Bitcoin climbed back almost to its highs of late December 2015, but failed to jump over the current high around $463. Currently, the Bitcoin price appears to be waiting for fresh inputs from conventional markets and their fundamentals — mainly the likely negative ones that would propel the Crypto sector further into higher territory.

On this background, the remainder of the month may see some exciting developments for both conventional stock and foreign exchange markets and “alternative” investments as well.

Bitcoin Price Picking Up More Solidly

The price of Bitcoin in US dollars has been picking up significantly again. The  market price of the “original Crypto currency” has been hovering for months but was stable around  $200, always clear of support around $180.

During the last weeks, bitcoins have been solidly advancing from $280 to more than $328 over the weekend. Weekends seem to be some kind of “high season” for amateur Crypto traders who appear to spend their free time glued to their screens and giving many Crypto currencies — beyond just Bitcoin itself — significant movements during these times.

Not that it mattered much for the overall idea of Crypto currency — but the price of Bitcoin is picking up very nicely again (and this time also quite solidly, without that infamous “volatility” the mass-media seems to “know” about BTC). With extra weekend-activity gone now, the latest reading for Bitcoin at Coinbase is still above $320.

The Safest Way to Store Bitcoin and Other Crypto Coins

Bitcoin has made headlines a number of times for some quite spectacular heists and thefts.

Out of over a million existing Bitcoin wallets, approximately a thousand or less than 0.1% have lost funds. Apparently, these have all been “digital” or software wallets stored somewhere on personal computers running general-purpose operating systems (not any kind of “hardened”, specialised OS-es) or maybe even web wallets offered by some Bitcoin service websites. Most certainly, they have not been properly designed “cold storage” facilities which are much more secure.

Even most recent press articles themselves suggest that casualties are mostly from the area of “hot” storage:

Since bitcoins are stored as software files in “wallets,” or folders on websites, personal computers or smartphones, that makes them susceptible to loss and theft, failure or cracking. And because the digital money was designed to be difficult to trace, any looting is akin to a cash plunder, and harder to track compared with real money held in bank accounts.

Even with “insured” banks and “traceable” deposits, it is rather hard to get one’s money back when stolen as banks (or their insurers) usually insist on inferring at least some partial fault on the bank customer’s part to prevent full (and for the bank costly) compensation. Also, it isn’t really fun to fight for that measly compensation, if you get it at all, so why bother…

Bitcoin’s value, having increased from $12 to more than $1,000 in 2013, has made the Crypto currency an even more tempting target and worth extra protection efforts on the part of reasonably educated users.

 

Real Cash

It is difficult to measure the percentage of wallet casualties more accurately, since bitcoins were designed to be similar to cash. They are not anonymous in any way, but the fact that transactions are irreversible makes it hard to get coins back once they actually happen to be apprehended by dishonest parties.

Bitcoin’s potential to be “cash for the internet” or rather for all kinds of transactions online and off is growing with a fast increasing user base. Created in 2008 by an unknown programmer or group of programmers, the supply of Bitcoin is regulated by the software underlying the currency, which can only be created by solving complex puzzles embedded in Bitcoin’s code. The digital money is being used to buy everything from chocolates to digital cameras on the Web.

 

Paper Wallet

The best and most effective method to prevent theft is “cold storage,” or offline Bitcoins. Andreas Antonopoulos, a Bitcoin evangelist and security specialist, has created the Safe Paper Wallet project making kits available that let users print their log-in credentials on a piece of paper, which can then be kept in a safe-deposit box.

“I keep 99.9 percent of my bitcoins in my paper wallet,” Antonopoulos said. “You don’t walk around with your net worth in your purse.”

The exact way of creating safe paper wallets involves a few more ingredients but can be done by anyone with a printer, preferably a “dumb” printer, and some common sense. A selection of simple tools, some of them free, as well as ready-made solutions are available. The important part is to not buy pre-printed plastic cards or fancy engravings where the Private Key is pre-produced by a third party which runs totally contrary to the “trustless” system of a Crypto currency.

There is even “deep cold storage” of Bitcoin paper wallets in geographically spread locations available where wallets (or even a mere copy of paper wallets) can be de-centrally stored to both secure them offline as well as mitigate all other conceivable systemic, sovereign default, or even natural disaster risks.

Whether for Bitcoin or any other Crypto coin, the availability of offline paper wallet generators and a way to easily create a paper wallet or similar true “cold storage” solution are essential for even considering use of that coin.

Exchange-like services, on- and off-chain investments, as well as safe-keeping services — possibly integrating several kinds of Crypto coin services into one flexible and easy-to-use security as well as investment or Asset Protection solution — could be developed to solve these fundamental challenges and further develop mass adoption of Bitcoin.

Fiat Currency World: Awkward Cash Withdrawal Limits at HSBC

HSBC have changed their cash withdrawals policy, severely limiting customer ability to access their money. What’s more, HSBC didn’t even afford their customers a proper notice about it, BBC reported earlier. In many cases, withdrawals between £5,000 and £10,000 have been rejected by the bank, quoting “unusually large amounts” as an alleged reason. The bank simply tries asking their customers to “withdraw smaller amounts only” and also asks for “further information” about the planned use. In some cases, documental evidence has been required. Basically, it would be in HSBC’s sole discretion if and when the costumers may or may not withdraw their money.

Unusual about this are not the amounts to be withdrawn but the fact that HSBC came up with such an exceptional and bold measure to secure what apparently and stretched capitalisation ratio.

Unilaterally changing essential terms of contract without the consent of their costumers is outside the scope of any Terms allowing for amendments and, therefore, constitutes both a breach of contract and also of trust. The latter may turn out worse for the bank.

Even more ridiculous are HSBC’s justification attempts for their new “policy” for occasional “large” cash withdrawals: the bank wanted to make sure it is the right way to make payment and to protect the costumer against guess who? The costumer himself.