Author Archives: Satoshi

  1. Home   /  Articles posted by Satoshi ( Page16 )
4 Aug 0

Stellard compared to Rippled

So there’s a new fork in town going by the name of Stellar!

Jed McCaleb had an idea for a new cryptocurrency which did not depend on mining and hired a small team of developers (David Schwartz, Stefan Thomas and Arthur Britto). This idea grew into one which borrowed from Ryan Fugger‘s original concept of community credit and was designed to provide a scalable solution for global payments with liquidity provided by anyone who wanted to make an offer or supply credit to satisfy that payment. An elegant concept was the basis for the formation of OpenCoin, later to become Ripple Labs. Jed hired Chris Larsen, and a subsequent, well-documented fallout occurs over the allocation of 20% of the XRP to three individuals and the fair distribution of the remainder. Jed leaves Ripple Labs and announces a “Secret Bitcoin Project”, which it turns out is a fork of the rippled codebase with some minor modifications and a new user interface. The release is partnered with a clearly expressed set of rules governing the distribution of the XRP equivalent known as STR.
So what are these code modifications and do they make a big difference to how likely Stellar is to succeed? Let’s have a look at the significant commits which have occurred since the fork attempt began on April 24th 2014. We’ll disregard all of the obvious “rename ripple=>stellar” alterations. 
Account ids begin with a g is a fairly straightforward change to the base58 alphabet for encoding account ids and other Stellar types. The main result is that all account ids begin the letter “g”, rather than an “r”. Why “g”? Who knows. 
Add InflationDest field is perhaps the most revolutionary change. The idea is that each account gets to nominate another account which, each week, receives a share of 0.019% of all the STR in existence, perhaps as a result of continued good stewardship of the network and supporting codebase. The field is optional. The formula is here and then revised here and here and here. Two new fields FeePool and InflationSeq are added to the LedgerHeader. 
Accounts can be deleted means that a user can consolidate his/her STR back into a single account from multiple accounts. Trustlines must first be removed. 
Clean up old unimplemented data structures, such as Nickname and GeneratorMap. 
Bootstrapping from a centralised peer provider is removed. 
A switch to ed25519 from P256 for creating and verifying signatures is implemented. 
Expose wallet_public to anyone and rename to create_keys. This is a security risk as someone could fake a response on a server and be in possession of your secret. 
Remove EmailHash, WalletLocator, WalletSize, MessageKey and Domain fields from AccountRoot serialization format and the flag PasswordSpent. 
A painful merge of the main rippled codebase. 
Some surprising lack of familiarity with a key data structure in the codebase. 
So, does the above represent any serious deviation or innovation on the rippled implementation? The inflation is an interesting idea, but it reminds me of the old bankers’ adage.

“There are two types of people in the world. Those that understand compound interest and those that pay it”.

The switch to ed25519 may one day permit performance gains, but not before any nodestore speed issues have been solved. The ability to delete an Account is useful. Everything else is mostly cosmetic and housekeeping. 
What is obvious from the team of three developers working on the C++ codebase is that there is not a deep understanding of what is going on in the internals, at least not yet. There is no published roadmap of future changes. Worst of all is that recent security fixes on the main rippled codebase have not been integrated into the stellard codebase and a new security flaw has been wilfully introduced.
The switch to an open and thoroughly explained plan for STR distribution is a welcome one, but a web page with words on it is just that. Time will tell.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
, , ,
Articles, crypto currency wallet, future, Ripple, Stellar
4 Aug 0

Network security and Proof-of-Work: do we need an alternative?

The Bitcoin protocol is designed using a proof of work mechanism, which determines who is permitted to sign the transactions that need to be verified.
A proof of work (PoW) is a piece of data which is computationally difficult to achieve, meaning that it required a lot of either time or hashing power (or both) to find the solution, but it’s easy to verify that this work was actually completed. Bitcoin uses a proof of work algorithm called hashcash, which has been around a lot longer than bitcoin itself, and was created with the purpose of being an anti denial-of-service (DOS) measure. Hashcash is fairly versatile and can be implemented with a number of functions; bitcoin uses hashcash-SHA256^2.
The proof of work consists in finding a target number that is below a certain target value, and in doing so the miner essentially “proves” that she performed a certain amount of “work” in trying various inputs. If I input a string into the SHA-256 hash function, there is no known way of determining what the output will be. Trial and error is the only way to find an input that will generate a hash that fits the desired criteria. In theory, you could nail it on the first try, but the probability of this happening is very small.
Given the current combined hashing power of the network, on average a solution is found every 10 minutes, at which point the block has been mined and the bitcoins are released as a reward. Every 2016 blocks, which ends up being approximately every two weeks, the algorithm moderates itself and either increases or decreases the difficulty of the problem. In practical terms, this means that it either increases or decreases the target value, so it’s easier or harder to find a value below it. This ensures a relatively smooth rate of release for newly mined bitcoins, and avoids flooding the market with coins at any given time.
It doesn’t matter whether I am using a supercomputer or a laptop to do the proof of work, it’s simply that with a supercomputer I can go through the attempts much faster, which means I have a higher chance of solving the problem before anyone else and therefore claiming the reward. The only thing that is important is how many hashes I can go through per unit of time, which is why the power of mining hardware is measured in MH/s, GH/s or TH/s (mega, giga and terahashes per second).
Some people in the cryptocurrency community have voiced the concern that miners may not be incentivized to continue mining if the price of bitcoin plummets, or simply because the reward for solving a given block decreases over time. Both are valid concerns but deserve to be addressed separately. In the first case, the assumption is that the reward amount would be too low for it to be worthwhile financially, and once all 21 million bitcoins have been mined this reward goes away entirely. Currently miners are primarily incentivized by the coinbase reward rather than the transaction fees, which is why many blocks end up with few transactions. Miners profit from the transaction fees, and the more transactions they include in a block, the more money they can make, but the opportunity cost of continuing to work on that block rather than go after a new one is high, as a competing block may win, rendering their work a waste of time and computing power.
Let’s assume that for whatever reason the price of bitcoin collapses, and therefore it is significantly less lucrative (net negative, once you factor in the cost of electricity) to mine. If miners are rational actors, most of them will stop mining, which is a problem for the network. The unintended consequence, however, is that mining would become dramatically less competitive, and therefore substantially more lucrative for those miners who continue to mine — at least in the short term. As I mentioned earlier, the algorithm self regulates to keep the average pace at which blocks are solved at around 10 minutes per block. As the bitcoin developer guide explains, Every 2,016 blocks, the network uses timestamps stored in each block header to calculate the number of seconds elapsed between generation of the first and last of those last 2,016 blocks. The ideal value is 1,209,600 seconds (two weeks).
Based on a comparison to the ideal value, the algorithm either increases or decreases the difficulty of the problem to solve, essentially recalibrating to try and get as close to 1,209,600 seconds as possible. To date, the difficulty has increased as more and more advanced ASIC miners continue to be developed, and more computing power is needed to have a chance at being the first to solve a block. However, the algorithm can also self-regulate in the opposite direction, making it easier to solve the problem by increasing the target value. Difficulty can be decreased by as much as 75%. This component of the protocol is particularly brilliant in design, as it basically guards itself against market shocks that could be produced by sudden swings in the mining power being inputted at any given moment.
Even if the bitcoins they are mining are worth substantially less post crash, if the miners believe that the expected future value of their bitcoins is significantly greater than it is at present, then it would make sense to continue mining. Alternatively, if a large percentage of miners quit because they didn’t anticipate the future value of bitcoin to make their present expenditure worthwhile, the new environment could still attract a new class of miners who are not currently mining because they don’t have the hashing power needed to make it lucrative, but if competition decreased dramatically, it would be. Presumably at this point other miners who had been mining previously would also see this and start getting back into the game, which would ultimately increase competition and start driving things in an upward direction again.
The likelihood that we see a huge drop in the price of bitcoin also decreases substantially over time, as it becomes less probable as the network expands. One of the main reasons bitcoin prices have been fairly volatile to date is that the network (by which I mean the number of consumers with wallets and merchants who accept bitcoin as a form of payment) is still relatively small. Bitcoin’s market cap has been hovering between 7 and 10 billion dollars, which means that any hedge fund worth its salt could take a position and dramatically swing the market. Bridgewater Associates, for instance, is the world’s largest hedge fund with $150 billion in global investments under management. In theory, they could buy ALL the bitcoins that have been mined to date 19x over, and still have enough left to throw in six Instagram acquisitions in for fun. And that’s only one of the top funds. Because the market cap is small, bitcoin to date has been subject to the whims of large actors; as the cap increases, there’s a strong chance that this will change.
There’s also the issue to consider that even in the absence of a price crash, incentives to mine naturally decrease over time as the amount of bitcoin received as a reward for mining a block is halved every 210,000 blocks, or approximately every four years. Theres is reasonable cause for concern that without the incentives provided by block rewards the network will no longer be secured, in that the transaction fees will not be sufficient to support the cost of securing the network. This is a manifestation of the game theory concept of the “Tragedy of the Commons” in which no individual actor wants to perform work or contribute to the community because he believes that she can reap the benefits regardless, but when everyone behaves this way, the system ends up collapsing and leaves everyone worse off. No one wants to pay transaction fees, but if everyone avoids paying them, the miners will have no incentive to keep security levels high, which could result in a systemic collapse.
To some extent, the point in time at which this problem becomes a reality will depend on the price of bitcoin, and no one can accurately predict when the network will reach that point, but even if prices continue to grow this is likely only a case of delaying the inevitable. If a bitcoin today is worth $600 and I receive 25 when mining a block, and in ten years I only receive 6.25 bitcoins for doing the same work, yet each one is worth $100,000, mining still makes a lot of sense. Even considering the investment in mining equipment, assuming that the amount of electricity I will have to expend will be higher, and discounting for 2-3% annual inflation, there’s still a substantial potential upside. There are a number of external factors (exact cost of electricity, price of ASICs or other mining equipment, etc) that will play into this and influence whether the network incentives to mine remain high enough, so it is worthwhile considering other mechanisms, prominent amongst which is proof of stake.
Proof of stake (PoS) is an idea that came about as an alternative solution to proof of work, primarily as a safeguard to some of the original protocol’s perceived shortcomings. Apparently it was first proposed in 2011 in the bitcoin talk forum by “QuantumMechanic”, and since then several models for implementation have been developed. A proof of stake scheme is similar to proof of work in that it is also a mechanism for determining who will sign the transactions in a given block, but instead of relying on hashing power, it uses ownership as the deciding factor. Simply put, if Alice holds 5% of all coins, she has the ability to mine 5% of the blocks. Theoretically this should increase network security by making it more difficult to mount a 51% attack. In order to do so, someone (probably a mining pool) would have to control over half of all coins in existence, which is much harder to do than controlling 51% of the hashing power. It’s worth considering that this isn’t impossible, as a large centralized pool could form and come to control over half the coins in circulation through a combination of owned coins and loans, for example. Realistically, however, in a proof of stake situation it wouldn’t make much economic sense to mount this type of attack. It would substantially reduce confidence in the network’s security, and likely cause the price to plummet. By crashing the value of a coin in which it is so heavily invested, the malicious mining pool would essentially be shooting itself in the foot. To some degree this is also true in a PoW scenario, but the disincentive is much stronger where PoS is being applied.
Although there’s no way to know exactly if and when an alternative to proof of work will become necessary due to a lack of mining incentives, a proof of stake scheme could also be a desirable solution for environmental and efficiency reasons. Since the proof of work process does not actually solve real-world problems, the energy is essentially burned without a real return, which is suboptimal. Implementing PoS, either in the form of a fork from the main proof of work blockchain or via the use of an altcoin that uses it (ie Peercoin, or something similar) could be significantly less costly than bitcoin mining as it currently stands, because the current system gobbles up a huge amount of electricity. Because PoS uses far less energy, as almost none is expended in the mining process, it would be substantially cheaper to make a profit mining than in a PoW scenario. It would also meaningfully reduce transaction fees in the long run, as miners wouldn’t have to charge high fees in order to cover their power and hardware costs.
We still lack a perfect solution to all these issues, and PoS is not a panacea either. One problem I see with implementing a PoS mechanism is that it could cause illiquidity in the market and lead to great concentrations of wealth. Miners would be incentivized to hold their bitcoin in order to be allowed to mine more, and therefore large concentrations pools of currency would accumulate. Currently, miners have an incentive to convert some of their mined bitcoins into dollars by selling them, but this is largely true because of a) price volatility – it is still risky to hold everything in bitcoin and b) there are still many assets that cannot be purchased using bitcoin. If PoS were implemented, and as both a) and b) become less relevant as the network expands, this could lead to a vast majority of coins being held by very few.
Despite the considerable improvements that proof of stake offers over proof of work in certain spheres, ultimately neither proof of work nor proof of stake offer a perfect solution to long-term network security concerns. Still, both clearly have useful characteristics which, applied in conjunction, could help overcome some of their own shortcomings. Just as I was wrapping up this writeup, Ryan Selkis passed along a fascinating paper by Bentov, Lee, Mizrahi, and Rosenfeld which proposes a third option, called Proof of Activity (PoA). PoA is predicated on the belief that neither PoS nor PoW are flawless, and seeks to pull in some of the better aspects of both. Given that this piece has already gotten quite lengthy in just looking at proof of work and proof of stake, I’ll write about the PoA paper separately sometime soon. The paper, titled “Proof of Activity: Extending Bitcoin’s Proof of Work via Proof of Stake”, is fairly technical, but it’s very thorough and for those who are so inclined I definitely recommend a read.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
,
Articles, bitcoin network, mining
4 Aug 0

The bitcoin industry in Australia!

Bitcoin adoption in Australia and New Zealand is increasing rapidly. Outpacing most of the Asian countries, the local startups and bitcoin merchants in Australia are trying hard to increase the bitcoin adoption in Oceania and help the local merchants to adopt bitcoin.
Currently, the major Australian exchanges have an estimated sum of 40,000 active local users and because of these exchanges, (including BTC markets, btradeaustralia, bitxoin and getbitcoin), there are more than 190 businesses accepting bitcoin in Australia. Although there aren’t as many “popular” or “famous” startups in Australia, the rapid growth of bitcoin exchanges and bitcoin merchants is helping the bitcoin industry thrive in Australia.
“The Bitcoin Association of Australia estimates that the Australian share of this market capital is approximately 2%. This means that the market capitalization for Australia is approximately $120 million.”

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
, ,
adoption, Articles, australia, bitcoin
urlhttpbitcoinexaminer.orgwp contentuploads201305b4s bitcoin041213a 10603381 8col
4 Aug 0

Top 10 awesome facts about Bitcoin

Here are ten awesome Bitcoin facts, success or disasters that you may not be aware of, enjoy!

You suddenly wish you could go back to university, but you only have bitcoins left because of your forward-thinking state of mind? Do not panic: you are now able to pay your tuition fees with Bitcoins for the famous New-Yorker university of The King’s College!

However, if you are not living on the American soil, be aware that it exists the same kind of initiative, for example by the University of Cumbria in the United Kingdom, or also by the University of Nicosia, in Cyprus. The latter also features a degree in « Digital Currencies » for its student that highlights Bitcoin.

Bitcoin Boulevard

Are you visiting the Netherlands? Do not miss the Bitcoin Boulevard located in the Hague, which offers a unique feature: A high majority of shopkeepers who are located on the two streets that go alongside the channel – Bierkade and Groenewegje – now accept Bitcoin, following an initiative submitted by Hendrik Jan Hilbolling and Peter Klasen.

You can therefore have dinner in one of the nine restaurants that participate to the operation, or you can go shopping in the art gallery also located there, thanks to your favorite cryptocurrency. Some other streets seem to follow the same move, in particular in the United States: for example, the North-American Bitcoin Boulevard located in Cleveland Heights, in Ohio.

The first transaction

Bitcoin has enabled 43 472 379 transactions since its creation through its network. However, you will be certainly interested by knowing who initiated the first transaction.

It is no one else but Satoshi Nakamoto, the fantastic Bitcoin and underlying technology creator, who sent 100 bitcoins to Hal Finney on January 12th, 2009.

Hal Finney has been involved for a long time in the cryptography community. For years, he has been working with PGP Corporation, developing one of the most famous encryption system (The company was holding the rights for the PGP system, developed at the origin by Phil Zimmermann). He launched then the first anonymous remailer used to encode his emails, and was also implicated in the cypher-punks’ movement.

On a Bitcointalks post, Hal explained how it happened:
When Satoshi announced the first release of the software, I grabbed it right away. I think I was the first person besides Satoshi to run Bitcoin [client]. I mined block 70-something, and I was the recipient of the first Bitcoin transaction, when Satoshi sent ten coins to me as a test. I carried on an email conversation with Satoshi over the next few days, mostly me reporting bugs and him fixing them.
After a few days, Bitcoin [client] was running pretty stably, so I left it running. Those were the days when difficulty was 1, and you could find blocks with a CPU, not even a GPU. I mined several blocks over the next days. But I turned it off because it made my computer run hot, and the fan noise bothered me. In retrospect, I wish I had kept it up longer, but on the other hand I was extraordinarily lucky to be there, at the beginning. It’s one of those glass half full half empty things.

The million dollar Bitcoin pizza

On May 22nd, 2010, a Bitcoiner named Laszlo Hanyecz paid to a Bitcointalks forum user not less than 10 000 BTC for two Papa John’s pizzas. What can be considered as an incredible amount (5 619 700$ worth of BTC nowadays) was equivalent to 30$, according to the exchange rate applied at this time, estimated to 0,003 cents per Bitcoin. Mr. Hanyecz said he had acquired these bitcoins by mining on his computer.
“It wasn’t like bitcoins had any value back then, so the idea of trading them for pizza was incredibly cool,” said Mr. Hanyecz. But when asked about the current value of the cryptocurrency, he adds: “No one knew it was going to get so big.”
Questioned about possible regrets, he adds:
“No, not really,” Mr. Hanyecz said. Then he sold his bitcoins when the price was around 1$, getting 4000$ “That was enough to get a new computer and a couple of new video cards, so I’d say I ended up on top.”

A Bitcoin master swindle

On November 4th, 2011, a BitcoinTalks forum user named pirateat40 has announced the creation of a Bitcoin investment fund, promising to the investors a return on investment of 7% per week.
Despite numerous suspicious elements and ridiculous incentives to invest such as “It’s growing, it’s growing!”, “I have yet to come close to taking a loss on any deal,” and even “risk is almost 0”, the fund encountered a fast and great success: according to the SEC report, more than 700 467 BTC, the equivalent of 411,7 million dollars, have been collected by Trendon Shavers, a.k.a pirateat40.
Contrary to the presentations made to the investors, the fund was not performing any trading activities; in addition, the users have never seen their « invested » bitcoins again.

Here is an infographic explaining the whole swindle scheme

More Bitcoin users in Poland than in France

While France is way ahead in terms of GDP (2,737,361 Millions of USD, FMI, 2013) at the 5th position, and Poland is at the 22nd position (516,128 Millions of USD, FMI, 2013), it seems that there are more Bitcoin users in Poland than in France!
This is the stunning fact that the download statistics of the most-downloaded Bitcoin client (Bitcoin-Core, totalizing 5M+ downloads) seem to indicate since January 2009: it has been downloaded 124,748 times by users having an IP located in Poland since January 2009, against 106,780 in France.
A first sketch of the explanation can be found in the progressive state of mind adopted by the Polish government:
Everything that is not forbidden is allowed. However, in light of EU legislation, we can’t recognize Bitcoin as legal tender or electronic money. Bitcoin capital gains are taxed as ordinary income. […] We don’t stand in the way of bitcoin’s development, but we need a declaration from its users whether they expect any regulations to be introduced or rather prefer the government to stand aside.
Krzysztof Piech, Ph.D. from Warsaw School of Economics, said that Poland is in the top 10 in the number of bitcoins mined, and Polish bitcoin trading volume is one of the biggest in the world. He also emphasized bitcoin’s potential for the Polish economy.
However, to reassure our French readers, we want to add that in terms of Bitcoin nodes, one has to admit that France keeps a clear advantage.

64% is the estimated part of present « ghost » Bitcoins on the Blockchain according to a study made by the California University

The history of Bitcoin is regularly studded by stories of users who have lost their private keys and who are not still able to use their bitcoins. See two examples of bitcoins who have not been spent for a very (very!) long while:
• 1FeexV6bAHb8ybZjqQMjJrcCrHGW9sb6uF : 75,957 bitcoins which have never been spent. Address created on March 1st 2011.
• 12tkqA9xSoowkzoERHMWNKsTey55YEBqkv : 28,150 bitcoins which have never been spent. Address created on April 5th, 2010.
The computing power of the Bitcoin network is 7468 times higher than the one of the cumulative 500 world supercomputers
Indeed, the computing power of the whole Bitcoin network is estimated to 2 046 364 Pflop/s, against 274 Pflop/s for the cumulative 500 most powerful world supercomputers.
First of all, it is important to note that Bitcoin miners are not performing any floating point operations (FLOP) but only integer calculus. How have we then been able to proceed? It’s very easy, in fact:
1 hash = 6.35K integer operations
1 integer operation = 2 floating point operations
1 hash = 12.7K floating point operations
Then, using this rate of one hash = 12,7K flop, and by analyzing the current hashrate of the Bitcoin network which peaks to 161 131 086 gh/s on July 31st 2014, we get an estimation of 10^9*161131086 H/s * 12700 = 2 046 364,7922 Petaflops. So much computing power that could have been possibly used in modelization purposes, for medicine, astronomy, physics. Damn bitcoiners!

The largest transaction ever made on the network: 194 993 BTC

https://blockchain.info/tx/1c12443203a48f42cdf7b1acee5b4b1c1fedc144cb909a3bf5edbffafb0cd204

It represents more than 114 million of dollars, according to the effective rate on 07/31/2014. « A shitload of money » is the comment submitted by the recipient of the funds about the transaction. We can only agree!

Some reddit users, such as gen_gen, had fun by trying to identify the author of this colossal transaction :

Interesting findings:

Going further down the tree from that tx shows that these two addresses are extremely likely Bitstamp cold wallets:17ewBhK712mY2E4uPAbinThibdY2LRyabd (85,993 btc)1DKH2oZtrcAAoZXsNJQnKBwKYaYdx5KrVV (39,200 btc) Also based on https://blockchain.info/tx/5d8a61b66c003743ba782b0b3931a782d8e0f1cdd8e4c2551faf15fc9334bdb5, it looks like 1Drt3c8pSdrkyjuBiwVcSSixZwQtMZ3Tew is a Bitstamp hot wallet.

And gen_gen was right!

Bitcoin’s Tiger Woods

In October 2009, so more than 10 months after the launch of the cryptocurrency, the bitcoins was traded at an extremely competitive rate: 1$ for 1,309BTC which is equivalent to less than 0,00076$ per Bitcoin.

Assuming you had spent 308 dollars in order to acquire your first 403,712 bitcoins, and that you would have sold them in December 2013 at the famous peak of $1240 / BTC, you would have a fortune of $501,556,440, which is the personal wealth of Tiger Woods added of one million of dollars ($500 000 000)!

Not a golf fan? No problem, let’s focus on soccer. You would have had to spend 80$ in bitcoins (104,720 BTC) in order to overtake the fortune of the international star Christiano Ronaldo, namely $130 000 000.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
Articles, bitcoin news
stellar
2 Aug 0

The Bitcoin Secret Project reveals Stellar

(TechCrunch) There’s Bitcoin, the asset and hedge against fiat currencies and the politics of their central banks.
And then there’s Bitcoin, a fundamental innovation around a
distributed public ledger of transactions. Many crypto-currencies try to
split or play with the distinction between the two.
An early attempt was the Ripple, from OpenCoin. But the team behind that startup split. Co-founder and Mt. Gox creator Jed McCaleb left to go work on other stealth projects.
Now he’s re-appeared again with a new non-profit called Stellar, that’s being backed by Stripe. Joyce Kim, who founded a company that OpenCoin acquired called SimpleHoney, is also leading the non-profit.
The similarities are obvious. Stellar
is a decentralized protocol for sending and receiving money in any pair
of currencies. It’s not exactly a competitor to Bitcoin; it’s meant to
facilitate transactions in all kinds of currencies from the majors like
the yen, dollar and euro to other emerging-market fiat currencies.
That protocol is paired with a crypto-currency called the Stellar.
They’re starting out with a fixed amount of Stellars that they’re freely
gifting to new users. This is very different from Bitcoin, which must
be mined through machines solving complex cryptographic problems in
exchange for small amounts of the currency awarded at fixed time
intervals.
Kim has argued in the past that this is a more egalitarian approach.
Mining means that only people with high technical skill or the capital
to operate now-expensive mining hardware get access to new Bitcoin. But
Stellar is distributing half of its initial amount to anyone who will
sign-up for it through the program. Stripe is getting 2 percent of
Stellars in existence in exchange for $3 million.
A quarter of the Stellars will go to non-profits via an ‘increased
access’ program, while another 20 percent will go to existing Bitcoin
holders based on a snapshot of the blockchain on a specific date in the
future. The remaining 5 percent will go toward operational costs. If the
value of Stellar’s payment network increases, so will the value of the
Stellars that the non-profit holds.
Also, unlike Bitcoin, the Stellar economy has a built-in inflation rate of 1 percent indefinitely.
Stellar’s board has Stripe co-founder Patrick Collison, Khosla VC and former Square COO Keith Rabois
along with McCaleb on the board. Also advising the non-profit are
security expert Dan Kaminsky, Joi Ito, Ronaldo Lemos, Linda Stone, Y
Combinator’s Sam Altman, AngelList’s Naval Ravikant, Jackson Palmer, Greg Stein, and WordPress’ Matt Mullenweg.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
,
Articles, Ripple, Stellar
Coles 630x250
28 Jul 0

Why Timothy Coles is selling his $2 Million Gold Mine for Bitcoin

 

Timothy Coles is the man behind the profitable gold mine in the Yukon
city of Dawson currently for sale for just over 3,200 BTC on luxury
marketplace BitPremier.

 

With more than 30 years of experience in the gold mining industry,
Coles brings a unique perspective to digital currency and the concepts
that underly the technology. He sees bitcoin as a one-of-a-kind type of
asset.

 

Coles told CoinDesk that he first learned about bitcoin while
wintering in the Philippines. Casual research grew into more active
investigation, leading to discussions about how bitcoin might fit into
plans to sell off his gold interests in the Yukon.

 

With the mine now for sale on the luxury exchange, Coles is optimistic about bitcoin’s prospects, saying:

 

“I believe bitcoin has nowhere to go but up. In the long run, it’s just going to get stronger and stronger and stronger.”

 

He added that although he currently owns no bitcoin, he sees a future
in it should the BitPremier sale succeed. While he has no active plans
to invest were he to enter the market, Coles expressed an openness to
invest in the broader bitcoin industry, including the mining sector.

 

The mine is currently on sale for $2m and reportedly generates $1m in annual revenue.

 

Bitcoin vs gold

 

When discussing the similarities and differences between gold and
bitcoin, Coles cited the fact that the prices in digital currency
markets are set by supply and demand.

 

By comparison, gold is subject to geopolitical pressures that have,
in his eyes, made it a less attractive option over the years:

 

“The people that have the bitcoin are the ones that can
drive the price up, or drive it down, depending on what ups. Whereas
gold, the people that have the gold are really at the mercy of
politicians, financial institutions, London fixes that we really know
nothing about. People that have gold really have no control over the
direction that goes.”

 

He went on to suggest that these influences could one day take a toll
on bitcoin. However, he said that the decentralized nature of digital
currency technology makes it “less susceptible to manipulation compared
to gold”.

 

Coles added that the price of bitcoin
went too high too quickly, resulting in an equally swift correction. In
the months since – which has seen a raft of both positive and negative
news for bitcoin – the price, he said, has risen on the merits of its
strength rather than pure hype or speculation.

 

Bitcoin needs education

 

One of the key problem areas of bitcoin, Coles said, is a lack of
education among the broader public. This is due to the novel
characteristics of bitcoin that make it not quite a currency, commodity
or property. Instead, it lies somewhere in the middle.

 

As a result, Coles reckoned, bitcoin’s success – and its price –
hinges on whether or not more people learn about how it works, how they
can acquire it and, most importantly, how they can use it.

 

He explained:

 

“I believe that bitcoin needs some advertising the world
over to learn more about what it’s all about. Nine out of 10 people I
talk to have heard of bitcoin, but they don’t know about it, they don’t
understand and they don’t want to because it’s out of their realm of
understanding.”

 

Pointing back to the topic of political impact on bitcoin, having an
environment in which more people understand how to use digital currency –
and do so – could enable the bitcoin market to operate without
manipulative influence from the outside.

 

More gold plans ahead

 

While citing problems in the global gold market, Coles said that
after the sale of his mining interest in the Yukon he’d stay on the
lookout for new opportunities. Issues aside, he said that he makes a
“good living” in the gold market, joking that the industry was “spoiled”
in 2012 and 2013, when gold prices surged above $1,700 an ounce.

 

He explained:

 

“I would still always keep my eyes open for opportunities in gold mining. It’s something that’s in your blood.”

 

As outlined in the BitPremier advertisement, Coles is offering to
help provide logistical and managerial support to a potential owner. The
sale actually has two components: Canyon Creek, a developed, three-mile
property with drilling and exploration already conducted on the plot,
and an existing lease in the Bonanza Creek region.

 

Coles explained the real prize in the sale are his interests on Bonanza Creek,
a waterway in the Yukon made famous for the abundance of gold
discovered in the region. He suggested they are the heart of something
that offers “big potential” to interested investors.

 

 

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
,
Articles, bitcoin, cryptocurrency
28 Jul 0

Bitcoin Foundation throws up everything you need to know about Bitcoin on GitHub

Bitcoin is all about decentralization — and now even its foundation is taking this route.

The Bitcoin Foundation has announced a set of community resources on
GitHub to educate people about Bitcoin and its potential, its website announced today.

Today’s announcement details how the Bitcoin Foundation’s education
committee creates guides for the general public about Bitcoin. It also
describes the committee’s goal to decentralize information about the
alternative currency by having content creation available to anyone on
GitHub. Anyone can join the education committee and
contribute to, update, or edit the content on GitHub. Membership in the
committee will be determined by contributions, not by a decree.
The three objectives of the Bitcoin Foundation are the
standardization of, the protection of, and the promotion of Bitcoin. The
education committee focuses on promotion
of Bitcoin, which in the “context of public misunderstandings,
misinterpretations and misrepresentations” about Bitcoin, “allow[s] the
community to speak through a single source.” With this
method, the foundation seeks to improve Bitcoin’s reputation.
The committee has already created some guides, including an introduction to Bitcoin, suggestions on purchasing bitcoin, choosing a wallet, using Bitcoin for business, and the currency’s technical side. The it documents the committee’s presence on social media, including their Twitter and Facebook, as well.
If this experiment in decentralized content creation is successful,
the committee won’t need a chairperson, which adds to the middle
man-less nature of Bitcoin. People in the committee would come and go as
they please. Ideas would gain and lose momentum as they become updated
or tossed aside. With GitHub, everyone’s work would be visible to the
public, and everyone could assist in educating the world about Bitcoin.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
,
Articles, Bitcoin Foundation, decentralization
Alex Grey Cosmic Christ CROP1 1000x288
27 Jul 0

Smart contracts may depend on Smart Oracles, said CTO of Ripple Labs

Smart contracts may depend on Smart Oracles to inform contracts about the state of the outside world, said CTO of Ripple Labs
(BitcoinMagazine) Stefan Thomas is one of the more talented and respected developers in
the space. An old hat at this young technology, he has been making
waves as the CTO of Ripple labs. In a recent effort he has set his
sights on smart contracts technology. The designs and implementation he
and his team have come up with are interesting, to say the least.
In a white paper entitled Smart Oracles, we see described a novel, simple, and flexible approach to smart contracts.
In such a system, rules can be written in any programming language,
and contracts can interact with any service that accepts
cryptographically signed commands. The paper also includes an
implementation of smart oracles, called Codius (based on the Latin “ius” meaning “law”).
Smart contracts are an exciting new frontier for technology,
business, and law that have the potential to usher in a wave of
innovation and serve as a building block for a next chapter of the
internet.
The concept of a smart contract is to formally encode the conditions
and outcomes of a legal agreement into a computer program. Rather than
rely on another party to enforce the terms of the arrangement, the
obligations of a smart contract are settled automatically and
autonomously through the execution of its code.
As such, math-based currency networks like Bitcoin and Ripple
provide an important building block for smart contracts by allowing the
transfer of digital assets with a cryptographic signature. The benefits
of using smart contracts instead of traditional contracts are increased
speed, efficiency, and trust that the contract will be executed exactly
as agreed.
Uatu, The Watcher
Most proposals for smart contracts depend on independent entities to
inform contracts about the state of the outside world. Bitcoin contracts
rely on “oracles”
to attest to facts from the outside world by introducing signatures
into the network if and only if specific conditions are met.
For instance, the smart contract for a will would need to know
whether or not someone had died. Such a system typically requires the
smart contract code to be executed on the consensus network itself. But
encoding advanced logic and executing untrusted code is complicated to
integrate. Until now, this has been one of the primary obstacles for
creating a viable smart contract system.
Smart oracles take the concept of oracles a step further by placing
the untrusted code execution in the oracles’ hands. Smart oracles, then,
are trusted or semi-trusted entities that can both provide information
about the outside world and execute the code to which the contracting
parties agreed.
By decoupling the execution of untrusted code from the consensus
databases and other services that track and transfer asset ownership,
smart contracts can be achieved without increasing the complexity of
existing consensus networks like Bitcoin and Ripple.
Algolon, The Observer
Without being tied to any single consensus network, contracts created
using smart oracles can interact with multiple networks at once as well
as virtually any type of online service. This means that a single smart
contract could interact with Bitcoin and Ripple, web-based services
like PayPal, Google, Ebay, etc. or even other Internet protocols, such
as SSH, LDAP, SMTP and XMPP.
The Codius implementation of smart oracles is designed to provide
developers with a robust and familiar platform to build smart contracts
and hit the ground running. Because Codius uses Google’s Native Client to sandbox untrusted code, developers can write contracts in any programming language.
Codius and smart oracles in general open up new possibilities for
developers, entrepreneurs, and enterprising legal and financial
professionals. Agreements that previously required lengthy legal
contracts can be translated into code and run automatically by smart
oracles.
Smart contracts hold the potential to empower people to build a
fairer, more affordable and more efficient legal system and smart
oracles are one of the simplest ways to realize that dream. Potential
use cases include bridges between value networks, escrow, cryptocurrency
wallet controls, auctions for digital assets, derivatives, debt and
equity, smart property and voting.
Since the system is extensible, the functionality will continue to expand as the ecosystem develops.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
, , , ,
Articles, decentralization, future, Ripple, smart contract, smart oracles
26 Jul 0

Bitcoin has passed the tipping point

Products and services that are first-to-market often take such a battering that they lose out to competitors with copycat products. Business history is littered with wildly successful products with ultimately spectacular collapses because they lost out to competitors that found a better way of doing things – things they learned at the trailblazer’s expense.

The Sony Betamax is the poster child for products that created a market and lost out to a rival – in this case VHS. Sony created a market for recording TV, but because the tapes where an hour long VHS grabbed the movie rental market.

More recently, Friendster was the first social network to explode, with millions of users in the first 3 months. But it couldn’t manage its growth and lost out to MySpace and of course Facebook.

adoption curve

There are many more examples. Some lost slowly, like the Atari 2600 game console, and some crashed spectacularly like Rio MP3 player. Palm lost to Apple, Netscape to Internet Explorer, WebCrawler to Google, Tivo to the cable companies, and on and on.

So far Bitcoin is an exception to this model. And though it’s been battered by ruinous headlines, including one just this week where the World Bank is calling it a naturally occurring Ponzi scheme, Bitcoin remains resilient.

Kaushik Basu, World Bank economist and author of ‘Ponzis: The Science and Mystique of a Class of Financial Frauds’ argues that most Ponzis today are not always obvious and that today’s Ponzi schemes often don’t have a puppet-master pulling the strings. Bitcoin, he says, is just such a Ponzi. The speculation on the currency raises the demand for Bitcoin making it a bubble.

Bitcoin has hundreds of competitors all built on the Bitcoin model. A handful are gaining some success, like Litecoin which is currently trading at $9, and Darkcoin (I’m not kidding) which is trading now trading at $7.50.

Darkcoin was built to cover perceived flaws in Bitcoin’s anonymity. One reason for the early success of Bitcoin was that it was as anonymous as passing dollars on the street. And while there is a far greater level of anonymity with this electronic transaction than making a purchase with a credit card or PayPal, Bitcoin is not anonymous to those forces who really want to know.

Unlike Bitcoin, Dash mixes up users’ transactions so that it’s nearly impossible to trace a payment to a person. But the promise of Dash’s privacy features solves a problem for only a small subset of Bitcoin users.

Few have heard of other crypto-currencies. If people barely understand Bitcoin, then any competitor has the impossible task of differentiating itself.

In his paper Basu mentioned Bitcoin by name, so did the IRS when it said it was a taxable asset. And this week Benjamin M. Lawsky, the superintendent of financial services for the State of New York, proposed regulations to create a “BitLicense” to include rules on consumer protection, the prevention of money laundering and cybersecurity. That’s akin to Apple successfully rebranding the MP3 to a podcast.

Just search “20 USD in BTC” on Google and you’ll get the exchange rate. It works for any fiat currency. You can’t do that with any other crypto-currency.

Bitcoin is currently trading at $600. Not bad for a five year old Ponzi scheme.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
, , , ,
adoption, Articles, bitcoin, bitcoin network, cryptocurrency, cryptoeconomics
bowman 1
26 Jul 0

Crowdfunding campaign aims to promote Bitcoin at NASCAR

(CoinDesk) Following the dogecoin community’s sponsorship of NASCAR driver Josh Wise at Telledega, bitcoin may soon boast its own promotional racer in the iconic US series.
Rookie driver Alex Bowman and his team, BK Racing, have announced their involvement in a crowdfunding campaign called ‘Bitcoin23’ that aims to bring a bitcoin-themed car to the NASCAR Sprint Cup.
The campaign kicks off today and runs until 20th August, with the aim to promote bitcoin while supporting the 21-year-old driver.
With the support of the bitcoin community, the organisers hope to raise $100,000 for a full sponsorship.
If successful, the team and driver will run the bitcoin-branded car during the Labor Day weekend race at Atlanta Motor Speedway on 29th-31st August.
“Bitcoin is changing the way people think about how they spend money and pay for things,” said Bowman.

Open your free digital wallet here to store your cryptocurrencies in a safe place.

Satoshi
,
Articles, bitcoin, bitcoin news
« Previous Page Next Page »

Most read articles:

Recent Posts

Archives

Categories

Copyright @ 2020 - HOLY STREET.
Made with ♥ by HolyTransaction