Global Validation or Speculative Bubble?

Bitcoin surpassed $10K yesterday. To many, the event was a mark of Bitcoin’s accomplishments. But yet, others are concerned that bitcoin has become too speculative, and a pop in the bubble could be damaging.  

Introduced in 2009, bitcoin sort of flew under most people’s radars for several years, until 2012, when it became associated with Silk Road, the now-defunct dark marketplace. This year the decentralized currency captured widestream attention, skyrocketing from $1,000 in February to where it sits today.

Some, like former Fortress hedge fund manager Michael Novogratz, are calling bitcoin a “spectator’s dream” and forecasting prices in the $40,000 range in the next 12 months. Others, like Nobel Prize–winning economist Joseph Stiglitz are less enamored: “So it seems to me it ought to be outlawed,” Stiglitz said Wednesday in a Bloomberg Television interview with hosts Francine Lacqua and Tom Keene. “It doesn’t serve any socially useful function.”

Here is what a few people from within the Bitcoin industry are saying.

Staying Power

Riccardo Spagni, core developer at privacy cryptocurrency Monero, told Bitcoin Magazine he hopes that bitcoin’s hitting the $10K mark offers proof to naysayers that despite its ups and downs, bitcoin is here to stay.

“I hope it demonstrates that bitcoin has value,” he said. “Because there are still people saying stuff like, ‘Oh, bitcoin is eventually going to die,’ or ‘It’s a bubble and tulip mania.’”

Much of the recent increase in bitcoin’s price has been fueled by institutional money. There are now 120 hedge funds solely focused on bitcoin and cryptocurrencies. But Spagni isn’t worried. He sees that as evidence that bitcoin has proven its stability and staying power to a larger pool of investors.

“Maybe this is the point where [institutional investors] find it palatable to enter the market,” he said. “They don’t want to enter a market for quick wins; they want to enter a market and purchase an asset because they know it is going to be around for 10 to 20 years, and I think that is what we are seeing now.”


Patrick McCorry, a cryptocurrency researcher and PhD candidate at University College London, agrees the $10K mark signals a broader acceptance. “I think the fact that it has reached $10K is like a global validation of the entire community’s work and the principles that surround it,” he told Bitcoin Magazine.

“Five years ago, bitcoin was not even accepted as a concept, but over the last four years, it has seen a big push toward social and regulatory acceptance,” he said. For instance, Japan now accepts bitcoin as a currency, whereas in the U.S., the IRS still considers it to be property.

He is also concerned that the main driving force of bitcoin is speculation, rather than its utility. “It’s more a growing population of users who want to make a quick return,” he said. His worry is that if the bubble pops, people will inevitably lose money, and that could be damaging to bitcoin’s image.

“It was envisioned to be a payment system,” said McCorry, who pointed out that people are not using bitcoin for that purpose.

“I attended a bitcoin conference recently. We went to a bitcoin pub and nobody bought pints with bitcoin. The greatest advocates in the space, and nobody used [bitcoin] for its primary purpose,” he said. “So what is the primary purpose of bitcoin? Is it for payments for digital gold or speculation?”

Profitable Mining

Marco Krohn, co-founder and CFO of cryptocurrency mining company Genesis Mining, admits bitcoin’s rapid escalation in price took even him by surprise.

“I’ve been in this [space] since 2011, and this is the first time I’ve seen the bitcoin price go up like crazy,” he told Bitcoin Magazine. “Everybody who was in the business kind of expected it would go up, but by a factor of 10 was really surprising.”

He thinks the price could go even higher, though, especially when making the popular comparison of bitcoin to gold. “You have to take into account the market capitalization of bitcoin is only two percent of the market cap of gold,” he said.

As the price of bitcoin climbs, so does the demand for mining.

“You can imagine you are in the gold mining business and the next day, the price of gold is 10 times higher. Everyone would get his axe and dig for gold, and that is what is happening,” he said. “And this creates a run at the moment for mining because mining is so profitable that everyone wants to do it.”

According to Krohn, cloud miners are struggling to keep up with the demand right now. Recently, when moving to a new facility, Genesis had to sell a lot of its older mining gear to make room for new equipment, but everything sold in a flash. “Within two and a half days, everything sold,” he said. “It is just beyond description at the moment.”

Road Ahead

Charles Hoskinson, CEO of blockchain company IOHK, has been in the space long enough to remember when bitcoin was below $5. Over the past five years, he says he has watched the markets move in all kinds of directions.

In fact, as this story is being published, after cresting at over $11,000 today, bitcoin has already dipped below $10,000 and then risen again.

The current bitcoin market cap is $167 billion, and while Hoskinson thinks $10K is a great “psychological barrier” to cross, he suspects that with bitcoin’s routine ups and downs, we may see it again. After all, that is just how bitcoin is. In an email to Bitcoin Magazine, he wrote: “We might be crossing 10k more than once on the ride to a trillion dollar market cap.”

Source link Funds Distributed Ledger Technology

29 November 2017, Zug Switzerland is delighted to announce that it is funding two post-doctoral seats at the University of Nicosia to focus on advanced research in Distributed Ledger Technology (DLT).  Specifically, will be supporting post-doctoral research at the University of Nicosia in the areas of 1) Distributed Ledger Technology, with a specific focus on side-chains and cross-chain interoperability, and 2) smart token corporate governance best practices and implementation.

With this important initiative, demonstrates its commitment to improving the state-of-the-art in the DLT field by supporting high caliber academic staff to pursue topics that will improve the functionality, interoperability, and  governance of blockchain technologies. CEO, Jim Preissler said of the agreement, “Without a doubt, this is a major development for us, in that it provides with access to some of the brightest and most innovative minds in blockchain and digital currency.  The University of Nicosia has embraced blockchain technology since 2013, being the first to accept bitcoin for tuition and to publish academic certificates on the blockchain”. Preissler continued: “They were also the first university in the world to offer coursework and an accredited academic degree program in this field (MSc in Digital Currency) and are considered a global leader in academia in this area.

Antonis Polemitis, CEO of University of Nicosia, remarked on the collaboration, “We very much welcome and commend’s willingness to fund and support technical research in some of the most interesting (and difficult) topics in Distributed Ledger Technology.  We are deeply interested in further research and development in these areas that will benefit the whole community and field at large.  Given the rapid growth of value being transacted globally on blockchains, it is critical that firms in this field contribute, both financially and technically, to basic academic research in the technologies that underpin this new field.”

The call for post-doctoral researchers under this program will be open on December 4th at is building a blockchain-based trading platform for cryptocurrency and traditional financial assets.   More information about can be found at:

The University of Nicosia (UNIC) is one of the leading comprehensive universities in southern Europe with over 12,000 students.  More information about the University of Nicosia can be found at:

This is a sponsored post.

Source link

Mexican Legislation Proposes Regulated Cryptobanks, Transfer Services

November 30, 2017 12:48 AM

The director general of Mexico’s central bank has said that if a bill regulating FinTech activities is passed into law, it will establish a framework regulating institutions that store and transmit cryptocurrency on their clients’ behalves.

The Law Regulating the Financial Technology Institutions (FinTech Law), which is currently pending approval in Mexico’s senate, proposes a regulated framework through which banks can store cryptocurrencies and electronic payment-processing firms can transfer them, according to the Mexican periodical El Universal.

The publication reports the Bank of Mexico’s director general of financial systems, Alan Elizondo, as having said that if the bill passes in its current form, companies falling under its purview will be “more strictly regulated compared to other Non-Banking Financial Companies … that have been operating in the Mexican market for years.” Mexican citizens in possession of cryptocurrency would be encouraged to store it with and send it via compliant vendors, though they seemingly would not be required to do so.

Based on Elizondo’s remarks, it seems feasible that customer-owned digital assets in the possession of regulated institutions will be visible to some government entities.

If and when the FinTech Law passes, the director general said, the central bank will issue additional regulations concerning cryptocurrency. According to El Universal’s translation, a draft of the bill states that the legislation “recognizes the need that a sector as dynamic as that of technological innovation needs a regulatory framework that allows authorities to mitigate risks and allow for growth in a competitive environment.”

Adam Reese is a Los Angeles-based writer interested in technology, domestic and international politics, social issues, infrastructure and the arts. Adam is a full-time staff writer for ETHNews and holds value in Ether.

ETHNews is commited to its Editorial Policy

Like what you read? Follow us on Twitter @ETHNews_ to receive the latest Mexico, legislation or other Ethereum law and legislation news.

Source link

Why Bitcoin Cash When You Can Dash? — Dash

Note that transaction speeds are approximate and subject to change. Over the past 24 hours the average block time for Bitcoin Cash was 9 minutes and 21 seconds.

Bitcoin Cash is being promoted by people that stand to benefit financially from the increase in its price. It is not being promoted because it offers superior technology than other cryptocurrencies or anything substantially different than what is already in existence.

Those that have accumulated large amounts at low prices or held their free forked BCH want to see it overtake Bitcoin. That is not surprising. But they are attempting to hijack the Bitcoin brand and take control from the Bitcoin Core developers. While many are understandably frustrated with the pace at which Bitcoin Core developers are addressing the rising costs and slow transaction speeds, these are also the same folks that have built and maintained the network into the trusted rock that it is today.

Under the guidance of the Bitcoin Core developers, Bitcoin has proven to be secure and the value of Bitcoin has skyrocketed from around $900 at the start of the year to nearly $8,000 today. They have implemented Segwit, which paves the way for the Lightning Network and other Layer 2 solutions that will address both the speed and cost issues that Bitcoin is currently facing. I hope they pick up the pace, but I can’t support a shift to a new forked coin with no other significant benefits than a larger block size. That is not enough to risk a major civil war, disruption of trust, confusion among new Bitcoin adopters and the potential of a significant amount of lost/stolen funds absent replay attack protections.

If I want an investment vehicle to store and grow my wealth, I choose Bitcoin (BTC). I can make occasional transactions that don’t require instant verification usually for a few dollars at most. In fact, I have used Bitcoin to buy many things over the past several months. Making payments online via Bitpay returns a confirmation usually within seconds and many stores offer discounts for purchasing with Bitcoin.

On the other hand, if I want instant transaction verification and very low costs, I use Litecoin or Dash. They both excel as a transaction layer cryptocurrency and have both been around for years. Bitcoin itself will likely have these abilities within the next 12 months. In the meantime, I see no urgent need to fork Bitcoin again into B2X or dump my Bitcoin for Bitcoin Cash. I am sure those manufacturing and running ASIC mining farms would be happy if everyone did this, but I don’t think it would benefit the larger community of cryptocurrency users or advance the cause.

Everyone will have to make their own decision. Those concerned with Bitcoin’s scaling issues can opt to reduce their exposure and hedge their positions by increasing exposure to other altcoins. There are several cryptocurrencies, with quality teams behind them, offering major points of differentiation in the market, addressing real-world needs and building new features sets that will benefit end users. I do not believe Bitcoin Cash is one of them.

On November 12th, I published the article titled “Why I am Not Buying into the Bitcoin Cash Hype.” Since that time, the price of Bitcoin has advanced by 39%, while the price of Bitcoin Cash has plummeted by 53%. Bitcoin Cash may yet have another rally with relentless promotion, but my money says that it will fail to keep pace with Bitcoin, let alone overtake the price in a “cashening” type of event.

DASH Is the Elephant in the Room

dash accepted here

With all of the attention on using cryptocurrencies for transactions, coins like Litecoin and Dash have benefited. While Bitcoin Cash dropped over 50%, the price of Dash has rocketed 35% higher and Litecoin is up 16% in the past week. I have increased my exposure to both of these cryptocurrencies and believe they remain undervalued at current levels.

Dash is digital cash that you can spend anywhere. Using their InstantSend feature, transaction confirmations take less than a second. They also allow you to protect your financial information and remain anonymous. PrivateSend ensures your activity history and balances are private. Lastly, Dash transactions are confirmed by 200 TerraHash of X11 ASIC computing power and over 4,500 servers hosted around the world, ensuring high levels of security.

Dash features a next-genearation P2P network. Miners are rewarded for securing the blockchain and masternodes are rewarded for validating, storing and serving the blockchain to users. Masternodes represent a new layer of network servers that work in highly secure clusters called quorums to provide a variety of decentralized services, like instant transactions, privacy and governance, while eliminating the threat of low-cost network attacks.

Dash was also first to implement a self-governing and self-funding business model. In Dash, everyone has a voice and the ability to propose projects directly to the network. Anything you can do – from marketing to development – that helps Dash grow and improve can be funded. This means Dash funds its own growth and adoption, consensus is guaranteed, and everyone is accountable to the network.

Dash wants digital currencies to be so easy to use your Grandma would use them. Their upcoming release, Dash Evolution, will enable users to signup and access Dash from any device and transact as easily as you can with PayPal, but in a fully decentralized way.

I don’t think Bitcoin Cash will go to zero. It may very well increase in value and carve out a niche among the various altcoins in existence. But changing the block size does not make it “the real Bitcoin” and anyone expecting it to become this will likely be disappointed.

To get all of our top cryptocurrency picks and research, plus our ICO tracker for initial coin offerings, monthly Contrarian Report newsletter and weekly trade alerts, click here. Subscription prices will increase in 2018, so make sure to lock in the current price levels if you want access to our research.

Remember, we are never paid to promote any investments, eliminating conflict of interest. We are a small operation with a personal touch and you can always email the founder, Jason Hamlin, with questions. Our newsletter consistently receives the highest ratings (just Google ‘Gold Stock Bull review’) and is a bargain compared to the insane pricing of some of the larger newsletter companies covering cryptocurrencies.

Source link