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Updated: 1 hour 5 min ago

Egypt's First Exchange Bodes Well for Bitcoin Adoption

2 hours 43 min ago

Egypt will see its first bitcoin exchange, Bitcoin Egypt, launch at the end of August. Citizens gain direct access to the cryptocurrency for the first time.

International bitcoin exchanges have refused to deal with Egyptian Pound, acting as a barrier to adoption. Acquiring bitcoin can be done via LocalBitcoins or with money exchangers who work with other payment methods. Two entrepreneurs from Alexandria, Rami Khalil and Omar Abdelrasoul, want to change this.

Abdelrasoul saw the gap in the market and will launch the exchange as bitcoin’s price hits record highs, and interest in the cryptocurrency grows across Egypt:

“We got the idea after we saw that there were lots of people in Egypt who wanted to trade cryptocurrencies but they were a hard time doing it on international exchanges as they were unable to buy coins using Egyptian Pound (EGP). So we decided to offer a solution by giving them the chance to trade using the EGP.”

Egyptian’s have suffered a severe loss of purchasing power of their national currency. The central bank devalued the currency in November as part of a deal with the IMF for a three-year loan for $12 billion. Since the devaluation, the Egyptian Pound lost more than 50 percent of its value against the US Dollar, illustrated by the chart below.

While a currency devaluation is good for bringing in investment from overseas, it has hit savers and lower-income groups hard. And with most of the population under the poverty line, it is doubtful whether the government can prescribe a policy solution for the detrimental effect on low-income households.

The weaker currency may have increased investment, but inflation has skyrocketed to 30 percent, with a potential side effect being that bitcoin will be a savior to Egyptians. With citizens feeling the pinch of austerity, it will be no surprise if Bitcoin Egypt is immensely popular when it launches at the end of August. With the number of bitcoin in existence never to exceed 21 million and the decreasing rate of money supply growth, countries that have experienced sharp increases in inflation, such as Venezuela, have adopted bitcoin widely. The cryptocurrency provides them one of their only safe spaces if the economy is experiencing catastrophe.

However, Sherif Samy, Chairman of the Egyptian Financial Supervisory Authority, recently warned the public that no legal protections exist for bitcoin.

With bitcoin’s resistance against devaluations, like the one the Egyptian government undertook, the cryptocurrency could become very popular as the population senses a deepening economic crisis. In a similar vein to how the IMF destroyed Latin American economies in the 1980’s, Egypt has privatized state assets (and sold two islands in the Red Sea to Saudi Arabia) to stay afloat.

The effects of the IMF policies on Argentina's economy is still a fresh memory. A similar austerity plan introduced in the 1980’s saw living standards decline. The IMF even admitted to exacerbating Argentina's currency crisis in the early 2000's. The results of these interventions have been negative. And by no accident, it is a region of the world where bitcoin is very popular.

Could Egypt follow in the footsteps of India, and become a major hub for bitcoin trading in a short period? Austerity will have lasting economic impacts. Bitcoin Egypt has arrived at the right time. Furthermore, the birth of an EGP-denominated exchange bodes well for the future of the Bitcoin ecosystem in Egypt, according to Abdelrasoul:

“We think it will bring lots of positivity for Egypt with lots of opportunities for innovation and development. Now that there is an exchange accepting EGP, it will allow people to start developing applications and uses for Bitcoin in Egypt.”

The post Egypt's First Exchange Bodes Well for Bitcoin Adoption appeared first on BTCMANAGER.

Blockchain & Bitcoin Conference Stockholm to Feature Discussions on ICOs and Blockchain Development

9 hours 20 min ago

On September 7, Stockholm will host a large conference dedicated to blockchain technology, cryptocurrencies, and ICOs – Blockchain & Bitcoin Conference Stockholm. That is one of the events from Smile-Expo company that organized 15 blockchain conferences in Europe. 

The key discussion topics will include blockchain implementation (in finance, power industry, municipal services, insurance), token issuance as an investment tool, and legislative regulation of cryptocurrencies and ICOs.

ICO for Startups and Investors

The hot topic of Initial Coin Offering will be highlighted in the discussions with the cofounder of TenX Julian Hosp, blockchain evangelist Oleg Kudrenko, and cofounder of Cofound.it Daniel Zakrisson.

Daniel will share the experience of successfully held crowdsale campaign that raised over $15 million to develop a platform intended for finding investment and financing startups. Julian will present five main characteristics of a successful ICO and give practical advice on token issuance, and Oleg’s presentation will focus on the analysis and prospects of Initial Coin Offerings.

Legislation and Cryptocurrency Adoption

One of the keynote speakers of Blockchain & Bitcoin Conference will be the main blockchain and cryptocurrency lobbyist in the Swedish Parliament Mathias Sundin. He is known as the world’s first politician that ran his political campaign backed up by bitcoin donations only. Mathias, whose election program contained the summons to support innovations, will present his view on cryptocurrency adoption by the society.

The report of Safello’s CEO Frank Schuil will cover a similar topic – the adoption of blockchain and bitcoin. He will review different stages of cryptocurrency adoption, from their zero value several years ago to wide opportunities in 2017.

Blockchain in Power Industry and Other Areas

Leading engineer of Polish IBM division Karolina Marzantowicz will devote her presentation to blockchain application in the power industry. The audience will learn how decentralization helps to cut costs in the power market.

In addition, the conference will include presentations on the topics of national cryptocurrency issuance, mining, shifting business to smart contracts, and blockchain application in the insurance field.

Alongside the conference, an exhibition of software, hardware, and related services that cater to the needs of crypto industry and investing will be held. 

More information about the topics and speakers is available on the website of Blockchain & Bitcoin Conference Stockholm.

The post Blockchain & Bitcoin Conference Stockholm to Feature Discussions on ICOs and Blockchain Development appeared first on BTCMANAGER.

Bitcoin Begins to be Taken Seriously by Big Financial Players

10 hours 34 min ago

The market cap hit $120 billion and bitcoin already seen its price go up more than 400 percent in 2017. Institutional investors are finding it harder to turn their back on the cryptocurrency.

In finance, many of the debates revolve around digital currencies and Blockchain technology. Many investors are looking to consult with the best financial advisors. There are concerns over how fast new entrants are raising funds, with initial coin offerings and fundraising now exceeding Internet angel and seed investing.

Goldman Sachs acknowledged the growth of digital currency is something investors cannot ignore. Robert Boroujerdi and Jessica Binder Graham, two Goldman Sachs Group Inc. analysts, clarified a few points about trading cryptocurrencies, ICO’s and how to define cryptocurrencies. They argue between the Currency and Commodity definition. Even so, Goldman strategists haven’t specified whether investors should buy digital currency.

Bitcoin is also on the radar of other notable strategists. For example, Swissquote, a leading provider of online forex trading and research, now includes bitcoin in its daily market reports, as shown below.

The bottom line is that institutional investors are now more interested than ever. With a race to unleash Bitcoin futures and Bitcoin-based ETF’s, we can expect their appearance by 2018. Up until now, institutional investors have avoided the cryptocurrency market due to its relatively small size, the structure of mandates and volatility. But the times are changing as many companies are planning to offer Bitcoin investments. Even though the classification of cryptocurrencies varies by country, government and even application, all agree in giving Bitcoin a legal tender status while for tax purposes, it is treated as virtual currency as property. Well, this is exactly the definition used for investors to file for new cryptocurrency funds.

On August 11, a leading manager of gold-related investment funds filed for a bitcoin-related exchange-traded fund with the U.S. Securities and Exchange Commission. In the first quarter of 2017 the Winklevoss brothers saw their Bitcoin ETF refused by the SEC. Now VanEck filed with the SEC for an exchange-traded fund that would invest in Bitcoin futures contracts and trade on the Nasdaq. Derivatives like futures allow investors to bet on potential gains or losses in Bitcoin's price without buying the digital currency itself. The fund will be an actively managed ETF seeking to a total return. Other firms have proposed digital currency trading products in the last several months.

In late April the SEC said it would review the Winklevoss brothers' application for a Bitcoin ETF, but up until now the SEC has not commented on that and declined to comment on this recent filing.

Since then, the Chicago Board Options Exchange revealed in early August plans to offer Bitcoin futures as soon as the fourth quarter of 2017. The news followed the U.S. Commodity Futures Trading Commission's approval for a digital currency trading platform LedgerX for clearing derivatives, which plans to offer Bitcoin options in early fall.

Ethereum is also receiving a lot of attention from financial groups. Bitcoin acts like virtual cash, Ethereum on the other hand, offers something much more complex; a platform that can run decentralized applications or Dapps and execute self-enforcing “smart contracts.” Ethereum uses its own currency called ether. The key function of ether is to facilitate and reward using the network.

For now, the Ethereum ecosystem is filled with unregulated ICO’s which are experiments that are most certainly going to fail. There is no doubt that we will be seeing the same interest in Ethereum from institutional investors.

For instance, one Swiss private bank will offer Ether to its clients from August 22. Arthur Vayloyan, Global Head Products and Services, explained that the decision to add three cryptoassets was down to the success of the Bitcoin service Falcon group introduced in July:

“We are pleased to add Ether, Litecoin, and Bitcoin Cash to our services just a month after introducing blockchain asset management solutions with Bitcoin, The first reactions to our Bitcoin services have been very encouraging, and we are convinced that by adding three new blockchain assets we will fulfil our clients’ future needs.”

Is Bitcoin the digital analogue of Gold? While many believe that Bitcoin will never surpass gold as a store of value, others see it stealing a lot of volume from the yellow metal. Experts believe it will take the price even higher. After hitting a peak above $4,300 on August 13, Ronnie Moas raised his price projection to $7,500. The Standpoint Research founder also claimed that a target of $50,000 by 2027 is viable.

The post Bitcoin Begins to be Taken Seriously by Big Financial Players appeared first on BTCMANAGER.

ATLANT Ending ICO Pre-Sale on August 19: Revenue Goals Achieved, Focus Turns to ICO Launch on September 7

13 hours 32 min ago

Today ATLANT (Atlant.io) announced the successful completion of its ICO presale, raising over $1 million in just a few days, exceeding its revenue objectives. ATLANT is ending its ICO Presale on August 19, 2017 at UTC 00:00.

Investors are welcome and encouraged to participate until that time. Full presale details are available at ATLANT’s website, Atlant.io.

ATLANT will now focus on its ICO (Initial Coin Offering) which will launch on September 7, 2017.

“The ATLANT Platform has significant long-term potential to positively impact the global real estate market in multiple ways”, said Julian Svirsky, ATLANT CEO “And the revenue we anticipate from our ICO will help us build out our complete solution quickly, while also creating a global community benefiting from tokenization of the world’s largest asset class.”

The core features of the ATLANT platform provide revolutionary capabilities in terms of security, efficiency and profitability in the global real estate market. ATLANT is planning its platform launch in March 2018.

ATLANT’s blockchain platform provides a secure, tamper-proof system enabling platform users to trade parcels of property without traditionally prohibitive costs and inefficiencies. Its Peer-to-Peer (P2P) transaction features will allow users to bypass intermediaries in rental deals, which will enhance ease-of-use and security for guests and hosts alike, improving user experience, reducing costs, and driving accelerated adoption.

The ATLANT platform will also enable the financial subdividing of individual parcels of real estate by tokenization, and ATLANT will subsequently list them on exchanges via PTO (Property Token Offering), starting with the decentralized ADEX exchange, based on Ethereum smart contracts.

The ATLANT platform will ease transfer of ownership, simplify fractional holding without minimal constraints, alleviate tax inefficiencies, make cross-border transactions simpler, and eliminate the substantial overhead faced in certain jurisdictions due to bureaucracy and unnecessary intermediaries

Starting in December 2016, ATLANT began working with leading experts in finance, real estate, emerging markets and scientific fields to develop the ATLANT platform. Please see the current ATLANT roadmap for further detail on the ICO and platform launch.

For a comprehensive technical and market overview, please see the current version of the complete ATLANT White Paper.

The post ATLANT Ending ICO Pre-Sale on August 19: Revenue Goals Achieved, Focus Turns to ICO Launch on September 7 appeared first on BTCMANAGER.

How NEO Became the Sixth Largest Cryptocurrency With $2 Billion Market Cap

Wed, 08/16/2017 - 17:55

Since the beginning of August, NEO has demonstrated a rapid increase in value, quickly becoming the sixth largest cryptocurrency in the market, with a $2.3 billion market cap as well as entering the top five of CoinGecko’s rankings. Still, the vast majority of traders and investors within the cryptocurrency market are still unfamiliar with NEO and its history.

NEO first debuted in China as Antshares Blockchain. The Shanghai-based open-source blockchain project raised over $4.5 million in its initial coin offering (ICO) and developed the “Onchain” universal blockchain framework. In the Chinese cryptocurrency market, Antshares gained popularity amongst traders as a competitor to Ethereum.

Upon its successful ICO in 2016, Antshares founder and CEO Da Hongfei stated:

“Our vision is to make Onchain a truly universal Blockchain framework. Utilizing different plug-in modules, our framework could be applied for a public chain, a consortium chain or even a private chain. Our cross-chain adaptor module, currently under development, creates interoperability among these different chains.”

NEO takes a hybrid approach to blockchain technology; while a blockchain is utilized, its approach to asset transfers differs from NXT or BitShares, and "gas" is not used to power smart contracts, as with Ethereum. Instead, the NEO token is like a security, similar to shares in the company. In a move that might be polarizing amongst cryptocurrency enthusiasts, NEO aims to be a brigde between the to the legacy financial system with smart contracts, identity, and legal compliance.

Antshares Rebrands to NEO

Despite its ambitious vision and long-term strategy to compete with Ethereum, Antshares struggled to allure traders in the global market. To better appeal to the global cryptocurrency market, the Antshares development team came to a consensus to rebrand its blockchain network into NEO. Initially, the Antshares team planned to complete the rebranding by the end of 2017. But, the process was sped up as the team behind Antshares secured a partnership with Chinese certificate authorities to develop Smart Contracts 2.0.

As Antshares rebranded into NEO, some of the largest bitcoin exchanges in the global market including US-based cryptocurrency trading platform Bittrex integrated support for NEO traders. Within months since the completion of its rebranding, NEO secured its position as the one of the top ten largest cryptocurrencies in the world.

The integration of NEO by Bittrex has been a key factor behind the rapid growth of NEO. As of current, more than 50 percent of NEO trades are processed through Bittrex, which has demonstrated a daily trading volume of roughly $100 million for NEO exclusively. Binance and Yunbi, two major China-based exchanges, have also served local Chinese NEO traders, providing efficient high performance trading tools and high liquidity.

Can NEO Sustain its Momentum?

Various analysts including Inc 500 entrepreneur and Influencive CEO Brian Evans believe that NEO will be able to sustain its momentum in the upcoming years by collaborating with Chinese authorities and commercial companies, and integrating physical assets into its smart contracts protocol.

“I personally am excited to see how NEO's smart economy will start incorporating into the real world. If it's able to integrate physical assets and even intentionally involve government in China, that could be a good thing for the growth of NEO's project, in this case,” said Evans.

According to Hongfei, the founder of NEO, the flexibility of NEO’s smart economy and its adaptability to a wide range of programming languages have successfully appealed to organizations investigating into the potential of integrating blockchain technology onto existing infrastructures and systems. The Chinese government for instance, is utilizing Ethereum to create a blockchain-based currency but using NEO to create a smart economy to process certificates.

“NEO developers can write smart contract code in .NET and Java/Kotlinm, and we are currently testing integration with Go, JS, and Python for a rollout in the future. This will allow a great number of developers globally to build smart contracts on NEO,” said Hongfei.

In the upcoming years, Hongfei emphasized that it will continue to work with law enforcement agencies and governments to demonstrate the potential of blockchain technology in real world applications and create a modern blockchain ecosystem:

“We believe blockchain usage will eventually integrate real world applications, such as digital assets based on digital identity. This would allow for better anti-money laundering and know your customer capabilities in blockchain, of which there is a paucity in the modern blockchain ecosystem.”

The post How NEO Became the Sixth Largest Cryptocurrency With $2 Billion Market Cap appeared first on BTCMANAGER.

DASH Follows Bitcoin's Footsteps, Establishes Fresh All-time High

Wed, 08/16/2017 - 12:36

DASH, one of the most popular altcoins, has surged to a fresh all-time high, following bitcoin higher on August 16 as the price reached $249.00 on Kraken and $234.50 on the Bitfinex exchange. With the price at unprecedented levels, we aim to find a new ceiling for the altcoin.

The weekly chart below for the Bitfinex exchange shows that DASH-USD could find a new ceiling around $315. The Fibonacci retracement tool is sued for the swing low point above $80.17, the low of May 2017 and the swing high point at $225.55, the peak of the previous bullish run in late June. This week, we have seen the market move above the fractal resistance at $225.55, bringing in a fresh all-time high.

Given the market has completed an upward move from $80.17 to $225.55 as well as a retracement from $225.55 to $120, we should see the long-term uptrend continue, with an initial target at the 161.8 percent extension level at $315.39. Moreover, a weekly close above $225.55 will give further bullish confirmation.

The weekly outlook for DASH-USD on the Kraken exchange is displayed below. As noted in our weekly cryptocurrency market outlook on August 7, we looked for a buy position if the weekly close was higher than $195.97. On August 14, the weekly candlestick closed higher than this level, at $198.99, confirming the bullish signal outlined in the August 7 report and as we stated, DASH surged to new highs.

A weekly close above $219 will give further bullish confirmation for the altcoin over the long term. Using the Fibonacci analysis for the price action on the Kraken exchange, we see that resistances are given at $283.27 and $387.27.

Looking at the daily timeframe for the Kraken exchange, we see that a Bullish Saucer pattern is setting up for DASH (the same pattern is also displayed for Bitfinex). The chart below illustrates the bullish signal from the Awesome Oscillator. Given that August 16’s high remains at $249.00, the Bullish Saucer will be confirmed on August 17 and we look to place a limit buy order at $249.01. Once the market triggers this order and moves above $249.00, we should see bullish momentum intensify, as bulls look to target the Fibonacci extension level at $283.27.  

In summary, we look for the Bullish Saucer to be triggered on August 17, with a move above August 16’s high required for confirmation; once the Bullish Saucer signal is triggered, it is likely to spark a fresh bullish run for DASH-USD, with targets near $300 and $380 valid over the long run.

The post DASH Follows Bitcoin's Footsteps, Establishes Fresh All-time High appeared first on BTCMANAGER.

BTC-E Claim Illegal Seizure by US Law Enforcement, to Recover User Funds

Wed, 08/16/2017 - 10:25

BTC-E, the oldest bitcoin exchange in the market which was seized by the US law enforcement in July due to the involvement of Alexander Vinnik, the founder of the exchange, in some of the largest bitcoin exchange hacks including the Mt. Gox and Bitcoinica incidents, is planning to recover its services and user funds by distributing BTE tokens to users.

In 2016, when Bitfinex was hit with a $70 million security breach, the exchange's development team designed a solution in which users were able to claim their lost funds through the Bitfinex (BFX) tokens as time passed. In essence, users were given the right to claim their balances through company profits. Eventually, Bitfinex bought back all of the BFX tokens issued after the hack, restoring the stolen funds of users.

At the time, Bitfinex stated:

“A combination of factors has led to this seminal moment for Bitfinex, including a dramatic uptick in equity conversions; record operating results in March; and, the decision to reduce our reserves in favor of this opportunity. We are tremendously grateful to all of our customers and new shareholders for helping us get to this point.”

BTC-E is trying to pursue a similar plan to Bitfinex by issuing convertible BTE tokens. Users that have lost funds during the seizure of BTC-E’s hot wallets and domains will be allowed to reclaim their funds through BTE tokens as BTC-E resumes its services and generates a stable source of profit.

One important condition of the token-based user fund recovery system which BTC-E users must take into consideration is that like Bitfinex, BTC-E must be in operation and should be able to generate profits in order for the company to purchase back its BTE tokens like Bitfinex ultimately did. However, in July, the US Financial Crimes Enforcement NetworK (FinCEN) fined the BTC-E team with a $110 million penalty and before settling it, BTC-E will likely not be able to resume its operation. More importantly, the BTC-E.com domain and its servers are currently being handled by the US law enforcement.

At the time, Jamal El-Hindi, Acting Director for FinCEN, stated:

“We will hold accountable foreign-located money transmitters, including virtual currency exchangers, that do business in the United States when they willfully violate U.S. anti-money laundering laws. This action should be a strong deterrent to anyone who thinks that they can facilitate ransomware, dark net drug sales, or conduct other illicit activity using encrypted virtual currency. Treasury’s FinCEN team and our law enforcement partners will work with foreign counterparts across the globe to appropriately oversee virtual currency exchangers and administrators who attempt to subvert U.S. law and avoid complying with U.S. AML safeguards.”

Despite the announcement of the FinCEN, the BTC-E team announced on their social media platforms that the exchange will be back live within five to ten days. Almost immediately after the BTC-E team released their statement, their servers, domains and funds were seized by the US law enforcement.

As of current, the only logical and possible way for BTC-E to release BTE tokens and operate its exchange is by obtaining its servers, domains and funds from the US law enforcement. According to the BTC-E team’s statement released on the BitcoinTalk forum, the company has recovered 55 percent of the funds and plans to sue the US FinCEN to recover the rest of its funds. Another statement released August 14 stated, "For each currency, a recalculation will be made taking into account the currently available assets. Currently 55 percent of funds are available, so 55 percent will remain in currency, and 45 percent will be converted to a specific currency token."

BTC-E has already made false promises to its users, clients and investors. It claimed to recover its platform within five to ten days since its closure and yet, nearly a month after the incident, the exchange is far from being in operation.

The post BTC-E Claim Illegal Seizure by US Law Enforcement, to Recover User Funds appeared first on BTCMANAGER.

Weekly Cryptocurrency Market Outlook August 15

Tue, 08/15/2017 - 18:29

BTCManager's Weekly Cryptocurrency Outlook highlights the price action and technical indicators on a long-term basis to identify the best opportunities in the largest cryptocurrencies, such as bitcoin, ether, and others.

BTC-USD (Bitstamp)

Bitcoin triggered the Bullish Saucer signal on August 8, breaking above $3339.66, and subsequently went on to establish a new high at $4400 on August 15.

Last week saw bulls dominate, but bears managed to push back, down from the high near $4200 and bringing the close to $4053.87, shown by the chart below.

The market attained our target at $4270.80, the first Fibonacci extension level. We look for a weekly close above $4270.80 to confirm a continuation of the long-term uptrend. On the other hand, support lies at $2980, the previous all-time high, and should provide strong support in the event of a prolonged pullback. Moreover, the conversion line (blue) also offers support at $3115, so we may see a test of this support before any further upside.

The daily timeframe is displayed below, with important supports standing at $3342.99 and $3178.72. The conversion line has held as support for August 15, at $3789.36. The market came within $15 of this critical support, posting a fresh low at $3800, but since then, buyers have managed to bring BTC-USD back above the $4000 handle.

Momentum is still indicated to be bullish by the Awesome Oscillator and the Ichimoku indicator. The conversion line may flatten out in the days ahead and give us an idea of where to place limit buy orders to get in on the uptrend. However, a daily close below the conversion line will point to a higher likelihood of an imminent test of the supports at $3342.99 and $3178.72.

On the 4-hour timeframe, the most recent fractal resistance lies at $4400, so we look to buy once this resistance is broken. On the other hand, a fractal support will form at $3800, suggesting short-term momentum will be skewed to the upside. Based on these fractals, we look to buy on a break above $4400, and sell on a dive below $3800, with a target of around $3350-$3200. A break above $4400 will see the market attempt our next target at $4730.74.

ETH-USD (Kraken)

The weekly price action for ETH-USD is interesting, as it seems to present a bullish setup for next week, but the Ichimoku simultaneously suggests a weakening outlook.

Firstly, the positive side for ether bulls. Notice the Awesome Oscillator, which was red in color and falling in value for five consecutive weeks but this week it has turned green and begun to rise. This is known as a Bullish Saucer and sets up a buy signal for next week; that is, a limit buy at the high of the current week’s candlestick.

Once triggered, we should see ETH-USD invalidate the fractal resistance at $320 and drift toward the all-time high.

On the other hand, a failure of the bullish saucer signal may see ETH-USD dive lower toward $250 and $208, supports highlighted by the conversion and base lines. Notice that the conversion line is moving lower and looks to cross the base line, which would give a weak bearish signal. A fractal resistance is also potentially going to form at $320, so if ether does not manage to regain this level in the next fortnight, a longer-term downtrend will be confirmed. More clarity will be given at the end of the week, once the current weekly candlestick has formed.

BCC-BTC (Bittrex)

Bitcoin Cash might be getting ready to make some large gains against bitcoin.

The daily chart below shows that the conversion line (blue) has moved higher on August 15, suggesting a short-term equilibrium around 0.0934. However, the market remains below an important fractal support at 0.0785. BCC-BTC must regain this level for a bullish outlook.

Once BCC-BTC regains the fractal support, we should look to target 0.0934, with a daily close above the conversion line providing a stronger bullish signal. Given that the conversion line is moving higher, and assuming it continues, we get an indication that the market will also head higher. Also, notice that the lagging line (purple) seems to have bottomed out and is also following the conversion line.

The 4-hour price action shown below indicates that we may see a bullish breakout for bitcoin cash on August 17. The chart shows that the red Ichimoku cloud is very thin for the entirety of August 17’s trading session; a thin cloud suggests very weak resistance, and if BCC-BTC is going to make some strong gains, it is very likely to begin on August 17. On the other hand, since the cloud is red and looks to be getting ready to move lower, we look to sell on a break of the most recent fractal support at 0.0675.

LTC-USD (Bitfinex)

There are two main things to note from the weekly chart of LTC-USD. Firstly, this week’s price action looks to drop below the conversion line, potentially giving a weak bearish signal by August 21. Secondly, the market managed to break to a fresh high above $50, but this high may turn into a fractal resistance.

Notice that the preceding candlesticks have lower lows and lower highs. Therefore, if LTC-USD remains below $50.247 until August 28, we expect further downside, with the base line (red) providing an important support level at $29.60.

On the other hand, a weekly close above the conversion line, that is above $44.04, will keep the long-term uptrend intact. Furthermore, if we see LTC-USD break above $50.247 any time in the next two weekly trading sessions, this will give bullish confirmation. Finally, litecoin failed to close above the resistance at $48.20 last week and a weekly close above this level will also give a strong bullish signal and a reason to enter into a long position.

NEO-BTC (Bittrex)

NEO displayed its largest ever gain in a single week against bitcoin, rising over 100 percent on large volumes, as Forbes' August 10 article put a spotlight on the project.

The weekly chart below identifies two possible areas of support where we look to buy NEO-BTC. Since last week’s action was dominated by bulls and the candlestick is almost a bullish Marubozu, we can use the open and 50 percent levels to find an entry to buy. The first support lies at 0.00844130 whereas further support will be found at 0.00493265. Also, notice that bullish momentum should strengthen, as the conversion line is moving higher above the base line and the Awesome Oscillator continues to move higher too.

The daily price action for NEO-BTC is shown below with a Dragonfly Doji looking to form for August 15. This doji candlestick pattern suggests that bulls will continue to dominate, as the low of August 15’s price action was very close to the conversion line, which provides support at 0.0092. If bears manage to take hold, we should see increased buying interest around the supports at 0.0089 and 0.0067. Alternatively, we look to buy once the market breaks the most recent fractal at 0.01199999 or with a daily close above 0.01190.

XMR-USD (Bitfinex)

Monero showed some indecision last week, with a slightly bullish slant, posting a a two month high at $53.43.

However, bears tempered bulls back to $48 by the end of the week. However, like ether, we are seeing a potential opportunity for a long position for the week beginning August 21. Notice that the Awesome Oscillator is forming a bullish saucer, which will be confirmed on August 21.

Moreover, the conversion line has jumped higher compared to last week, suggesting the general market direction will be upward. We look to place limit buy orders near the conversion line at $40.71. A break above the recent high at $53.43 will also necessitate a bullish outlook; by invalidating the fractal resistance that is in progress, we should see an attempt to find a new ceiling by the market, with a further resistance at $58.14.

Finally, we can also examine this week’s candlestick close and compare it to $47.85 for an indication of the long-term momentum of XMR-USD. For instance, a closer higher than $47.85 means that is will be likely XMR-USD continues the upward trend. However, a weekly close below $47.85 could mean that the altcoin will display some weakness.

OMG-BTC (Bittrex)

OmiseGo is a relatively new Ethereum-based token gaining a lot of attention from traders; when judging by the 24 hour volume, it is within the top ten cryptocurrencies.

The daily chart below illustrates a bullish outlook for OMG-BTC, as it looks as if another test of the Fibonacci extension level at 0.00203578 is due. Notice the flat conversion line has held as support. We could place buy limit orders around the conversion line and base line and target the Fibonacci levels at 0.00203578 and 0.00308076.

ARK-BTC (Bittrex)

The altcoin ARK has displayed high volume over the past 24 hours, as well as compared to any other week, shown by the chart below.

At the time of writing, the trading volume for ARK is similar to that of Ethereum Classic and DASH. The weekly price action shows an interesting market structure, with just three fractals formed so far in ARK-BTC’s history.

Two are down fractals (supports) and one is an up fractal (resistance). Notice that the market has tested the fractal resistance at 0.00044206 so far; a sustained break or weekly close above this level will open up the first resistance at 0.00196608. Notice that this is the 50 percent level of the large bearish Marubozu for the week that Bittrex listed the crypto-pair. Given the relatively short history and that the lagging line has broken all of its resistances, 0.00044206 is the nearest resistance given the limited information that we have from the market price and its behaviour.

We also see that the conversion line has started to form an uptrend, moving higher this week. Since the market has remained below the conversion line since mid-June, it could be the week where we get the first close above this important support. However, the market may close a lot higher, given no prior resistances and the increase in the volume, so we suggest buying on a break of the fractal at 0.00044206 or once we get the weekly close, providing it is not too far away from the conversion line.

Market Snapshot

The top ten cryptoassets are shown below by market capitalization and 24-hour volume.

Market Capitalization

24-hour Volume

Source: CoinMarketCap.com

The post Weekly Cryptocurrency Market Outlook August 15 appeared first on BTCMANAGER.

Blockstream Satellite Ignites Bitcoin Access

Tue, 08/15/2017 - 12:38

On August 15, Blockstream, a leading provider of blockchain technologies, launched Blockstream Satellite, an innovative service that provides free access to the Bitcoin network. It will target an estimated four billion people currently not connected to the internet, due to lack of availability or affordability.

Blockstream Satellite broadcasts real-time Bitcoin blockchain data from satellites in space, delivering availability across two thirds of the Earth’s landmass, with plans for near global coverage by year end.

In an exclusive interview with BTCManager, Blockstream Co-founder Adam Back offers his thoughts below on the genesis of Blockstream Satellite, its purpose and long-term vision.

What is Blockstream Satellite and What was the Impetus Behind its Launch?

Blockstream Satellite is a new service that broadcasts real-time Bitcoin blockchain data from satellites in space to almost everyone on the planet.

Today there are an estimated four billion people around the world who aren’t connected to the internet, due to lack of availability or affordability in their area. As members of the growing Bitcoin community, and as believers in the technology to be able to create a positive, social impact, we wanted to make bitcoin available to even more people than ever before.

How Will People be able to Access it?

With Blockstream Satellite, just one person in a community needs to have access to the blockchain data through Blockstream Satellite, allowing for the distribution of that data to other people locally. Although Blockstream Satellite users today will still need some internet access (cellular, satellite internet, etc.) for bitcoin transactions themselves (the median bitcoin transaction size is only about 250 bytes). Blockstream Satellite handles broadcasting on the Bitcoin blockchain which is projected to grow by 8 gigabytes per month.

How Secure is it?

At Blockstream, we take a security-first approach to technology. More people participating strengthens the overall robustness of the network. Blockstream Satellite also provides an additional layer of reliability for blockchain data in the event of a network interruption.

“Users can also gain improved privacy by receiving the Bitcoin blockchain over satellite and avoiding the highly identifiable traffic patterns associated with retrieving it over the network.”

What sort of Infrastructure Supports it?  

The Blockstream Satellite network currently consists of three geosynchronous satellites at various positions over Earth that cover four continents; Africa, Europe, South America, and North America. Ground stations, called teleports, uplink the public Bitcoin blockchain data to the satellites in the network, which then broadcast the data to large areas across the globe. Additional teleports are being built out in phases to enable worldwide coverage.

“By the end of 2017, additional satellites will be added to the Blockstream Satellite network enabling worldwide coverage and reaching nearly every person on the planet.”

And the Software?

Blockstream Satellite makes extensive use of open source software. GNU Radio, an open-source software development toolkit, enables the cross-platform implementation of software-defined radios (SDR). The use of SDRs eliminates the need for specialized hardware, which greatly reduces cost and makes the technology widely available. To further ensure performance and reliability, Blockstream Satellite utilizes the Fast Internet Bitcoin Relay Engine (FIBRE), an open-source protocol based on several years of experience operating and studying the Bitcoin Relay Network. Together, these open-source technologies power the Blockstream Satellite network enabling Blockstream to provide this free service to users reliably and cost effectively.

What sort of Real Impact Do You Believe it will have on Bitcoin Adoption?

We believe Blockstream Satellite will accelerate Bitcoin adoption. Blockstream Satellite creates a way to bring Bitcoin to more people, especially in places where there are internet limitations. One of challenges of blockchains is that they are broadcast; every block on the blockchain has to go to every node everywhere in the world. It’s hard to do broadcast data on the internet; you have to make copies over and over again, which is inefficient and can be quite expensive or impossible in some areas.

Finally, What is Your Long-term Vision for Blockstream Satellite?

Our plans for Blockstream Satellite include bringing on more satellites and teleports to enable worldwide coverage and to reach nearly every person on the planet by the end of 2017. As more people start using Blockstream Satellite in the coming months, we look forward to seeing increased user adoption and to hearing from businesses what advanced features and capabilities they would like to see considered in the commercial roadmap.

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Bitfinex Closes its Exchange to US Consumers, Impractical Regulations

Tue, 08/15/2017 - 07:49

On August 11, digital assets exchange ShapeShift founder and CEO Erik Voorhees revealed that Bitfinex, the third largest cryptocurrency exchange behind Bittrex and South Korea’s Bithumb, has terminated its services in the US due to inefficient and impractical regulations.

“Bitfinex is closing service to US customers. Yet another innovative exchange abandoning US regulatory nightmare,” said Voorhees, who had previously terminated ShapeShift’s service to its users and clients in New York, after the BitLicense was approved by the New York State Department of Financial Services which required companies like ShapeShift to maintain strict Know Your Customer (KYC) systems that placed user data vulnerable to security breaches and hacking attacks.

In an official company announcement, the Bitfinex team stated:

“Unfortunately, we have an obligation to our whole customer base and to our shareholders to make rational resource allocation decisions. Furthermore, over the next 90 days, we will be discontinuing services to our existing U.S. individual customers. We will be communicating further with affected users on timing and specifics.”

Reasons Behind the Termination of Bitfinex’ Services in the US

Effective upon the release of the company’s announcement on August 11, Bitfinex stopped receiving verification requests from US-based consumers and has begun to clear its backlog of verification requests.

The Bitfinex team emphasized that it has considered pulling its company away from the US retail marketplace for a relatively long period of time, and in light of the recent difficulties surrounding the company’s financial service providers and the abrupt closure of the bank accounts of Bitfinex, the firm came to a decision to end its services in the US.

“We have for some time considered pulling away from the retail marketplace in the U.S., and now with a current backlog of verification requests and ongoing difficulties in providing USD deposit and withdrawals for U.S. individuals, we feel that the time has come to begin disengaging from U.S. retail customers,” the announcement from Bitfinex read.

One of the driving factors that led to the closure of the services of Bitfinex in the US is the disparity between the amount of resources the company has allocated to serve US customers from actual profits generated through verified US individual accounts. In order to operate in the US, exchanges like Bitfinex, Coinbase, GDAX, Gemini, Kraken, and Bitstamp are required to comply with strict KYC and Anti-Money Laundering (AML) policies. Furthermore, the SEC's recent ruling concerning Initial Coin Offerings stated that any exchange or project offering tokens to US customers falls under the regulator's jurisdiction.

In a financial standpoint, it is a logical decision from Bitfinex to leave a small market for the company that is the US and cut massive costs and expenses in return. More importantly, for the sake of user privacy and financial freedom, it is of utmost importance for Bitfinex to not operate in markets that require excessive KYC and AML requirements that do not necessarily benefit neither the company and its users.

“Accounts while a dramatically outsized portion of our resources goes into servicing the needs of U.S. individuals, including support, legal and regulatory. We anticipate the regulatory landscape to become even more challenging in the future. Bitfinex is not based in the United States. Exchanges based in the U.S. are better positioned to properly service retail U.S. customers,” added Bitfinex.

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Creating Space for Investors on the IoT

Mon, 08/14/2017 - 21:39

The IoT (internet of things) is creating a whole new ‘connected’ world.

Every day, new devices are introduced to the marketplace that promise to connect our lives together. Dishwashers, cars, homes, and 3D printers are connected to the internet and provide a level of personal control and access unheard of even three years ago. This complex web of devices has also created a new opportunity for revenue generation, as connected machines can be used for profit, and investors are flocking.

Problems abound, however. The cost barrier for entry is very high.

High-quality machines that can generate substantial revenue often run into the multi-thousands of dollars, and more. Investors are required to create huge front end financing in order to even begin generating income of any kind. Further, a single machine does not necessarily generate revenue unless it is connected to a system for advertising and use. Hence, for investors to capitalize on the IoT explosion, they must not only have enough capital for machine purchases, but must also create points of sale for the machines.

MyBit and the Solution of Tomorrow

One company, however, has envisioned a way to create a new and improved investment vehicle for small scale investors to capitalize on the IoT. MyBit.io has created a platform where small scale investors are able to enjoy the benefits of large scale investment. In very simple terms, individuals are able to pool financial resources to purchase revenue-generating machines. Rather than huge upfront capital investments, a pool of investors can work together to purchase machines that create profit, and then can receive revenue return from those machines in near-real time. The connectedness of these IoT machines makes use and revenue distribution nearly instantaneous.

The system is built on blockchain technology, the new darling of the tech world. The technology creates a distributed ledger system where the information and investment of each party is transparent, and the revenue generated is immediately credited to the investor. Legacy investment companies have centralized business models. These allow profits to be gobbled up by large management teams and infrastructures. MyBit replaces these top-heavy infrastructure models with blockchain, distributing both the investment and the return directly into the hands of users.

A Simple Test Case

Consider, for example, the case of a 3D printer in an orthodontic office. The printer is being rented by the orthodontist in order to create models of patient’s teeth. This creates a shorter life cycle for braces and increases the business revenue. The printer, however, is worth perhaps $100,000, and the orthodontist is paying a hefty rental cost, along with purchasing the cost of the consumables. The machine itself is connected to the internet and provides real time feedback on usage and condition.

Rather than a single large scale investor, the printer is owned by, perhaps, one hundred individual investors who have each invested $1000. Every month when rent is paid and consumable products are ordered, the investors each receive (instantaneously) their portion of the rental payment. The orthodontist is pleased because revenue is increasing, and the investors and pleased with the rapid return on investment.

Plus the sales and marketing are carried out by a local company who does not have to invest the massive up front cost for the printer itself and can focus instead on lead generation.

MyBit empowers the business to move forward by partnering with distributed investors while producing a seamless revenue stream for small scale investors. 

A Unique ICO

MyBit is currently in the midst of an ICO (initial coin offering). The unique benefit of the MyBit ICO, however, is that investor returns are not tied only to the value of the coin, but to the investment the coin has purchased. This means that investors are able to receive almost immediate return on investments, while still holding value in the coin.

The ICO will conclude on August 17, after which the price point of the coins will likely increase exponentially. The company has already signed agreements in both Germany and Dubai, and investment platforms are opening up around the world. The IoT will continue to be a point of revenue generation, as the machine economy grows. MyBit promises to move investors into this space at whatever level they feel comfortable, while maintaining the inherent value of the investment and promoting business development.

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Bitcoin Ecosystem Strengthens Amid Record Highs Above $4000: BTCManager’s Week in Review August 14

Mon, 08/14/2017 - 19:40

The price of bitcoin hit yet another all-time high this week when the market managed to reach $4,190 on August 13 as SegWit has been locked in and will soon come into effect. However, that was not the only driver of the cryptocurrency’s price. The Bitcoin ecosystem is showing clear signs of maturing, with the cryptoasset not only into a viable alternative asset class, but also underpinning a new industry.

Bitcoin’s trading volumes have jumped so far in August and the number of bitcoin transactions have doubled from August 1 to August 14, returning to the pre-fork level around 260,000 per day. While some of this volume can be attributed to bitcoin holders selling their “free” bitcoin cash (BCH) tokens, there is also new money flowing into bitcoin now that the split that threatened bitcoin’s existence has passed with little to no damage to the digital currency or its network.

Furthermore, the Bitcoin ecosystem is expanding as seen by Coinbase’s recent $100 million cash injection in the form of a Series D funding that now values Coinbase at around $1.6 billion. This makes Coinbase the first bitcoin startup unicorn and is a big step towards fully legitimizing bitcoin and cryptocurrency as an asset class. Also, Fidelity expanded on their offering to let customers view their holdings on Coinbase, after initially rolling out the tracking service for bitcoin in May. GBTC is trading at a substantial premium to bitcoin, approval for an ETF looks to be on the horizon and big players in the financial space are starting to take bitcoin seriously.

The Bittrex exchange has been one of the main benefactors as well as driving forces behind the boost in altcoin trading as it has now become the second largest exchange in terms of traded volume for digital tokens, which is also indicative of the progress of the Bitcoin ecosystem.

Bittrex is most known for being one of the first large exchanges to list new altcoins (especially ICO tokens) and capitalized on the Bitcoin blockchain fork by capturing a big share of bitcoin cash’s (BCH) trading volumes just after the split, as well as adequately handling the split. Improved confidence, as well as moves away from Poloniex by many traders due to several ‘red flags,’ has propelled Bittrex to the forefront as a leading cryptocurrency exchange. Further, the popular trading website TradingView.com recently added trading pairs for the exchange, further increasing the visibility of bitcoin (and cryptoassets) to established traders and investors.

While bitcoin is soaring, altcoins are not lagging behind by much. The price of ethereum shot back up through the $300 mark amidst geopolitical turmoil in Korea and the cryptocurrency of China-based smart contract platform NEO (formerly known as Antshares) has shot into the top ten cryptocurrencies by market share, as well as into the top five of CoinGecko’s weighted rankings, rallying from $15 to $52.

This week’s review is compiled from contributions by Alex Lielacher, Nigel Dollentas, Jamie Holmes, Joseph Young, and Michael Scott.

SegWit Lock-In: What Does it Mean for Bitcoin?

On August 9, the highly-anticipated Segregated Witness (SegWit) protocol upgrade to the Bitcoin blockchain was officially locked in on block 479,707. While there is still a two-week waiting period before SegWit will be fully activated, the lock-in means that all bitcoin mining operations have to implement this update now or else they will have to give up their bitcoin mining income going forward. The two-week waiting period gives Bitcoin participants the time to upgrade their systems to the new software and will be finished around August 22.

The move of the Bitcoin community to implement SegWit, which also led to the hard fork that created the new altcoin bitcoin cash was welcome by the majority of the community as well as investors who witnessed the price of bitcoin rally to new all-time highs.

Korean Buyers Take Ethereum Beyond $300 Amidst Geopolitical Tremors

Since August 9, tensions between North Korea and the US have intensified, with South Korean traders piling money into the cryptocurrency of the second largest blockchain network, Ethereum. ETH-USD breached the $300 handle and now finds support at this psychological level; we provide an outlook for the cryptocurrency going forward.

While markets across the world have shown increased volatility in response to the war of words, cryptocurrencies have remained fairly stable, incubated from any threat of a war on the Korean peninsula. The drama started on August 9, when a US report was released claiming that the North Koreans had developed a minature nuclear weapon.

Australian Senators Call for a Bitcoin-like Currency

Two Australian Senators from different political parties teamed up on August 8 to speak at the country's parliament in Canberra about the promise of blockchain technology, and urged the Reserve Bank of Australia to consider a Bitcoin-esque currency.

Liberal senator Jane Hume and Sam Dastyari, a Senator from the Labor party, have pushed forward blockchain adoption 'Down Under' with the formation of the Australian Parliamentary Friends of Blockchain group. The motivation for the group is best explained by Dastyari, who stated that when he first raised the topic of bitcoin in the Senate, one of his colleagues came to him and said: 'I don't get what the issue is, don't they just melt all the coin bits they don't use?' The Australian Parliamentary Friends on Blockchain group will provide a much-needed forum for all things related to digital currency.

WikiLeaks Accepts Zcash: Why It Is Raising Eyebrows

In a move viewed as highly questionable within some cryptocurrency and libertarian circles, non-profit media group WikiLeaks, founded in 2006 by Australian computer programmer Julian Assange announced that it is now accepting donations via the privacy-centric cryptocurrency zcash.

WikiLeaks recently revealed on Twitter its intent to utilize this new payment option. Zcash becomes the third cryptocurrency the organization is accepting for donations, along with bitcoin and litecoin. Exactly one week later on August 13, the organization announced it would be accepting Monero, another privacy-focused cryptocurrency.

WikiLeaks has been accepting cryptocurrencies for donations since 2011. This move was in direct reaction to efforts on the part of banking institutions to thwart the nonprofit’s revenue streams. All of this was part of a larger attempt to squelch WikiLeaks repute as a public disseminator of classified information and secrets. As a result, WikiLeaks, in an effort to do a end-around government controls, now utilizes a funding model that is primarily cryptocurrency based.

8-Year-Old Computer Prodigy Programming ‘WoorannaCoin’ to Grasp the Blockchain

A group of elementary students, including eight-year-old computer prodigy Seth Yee, at the Wooranna Park Primary School in Australia work on programming ‘WoorannaCoin’ under the guidance of former network engineer Kieran Nolan, which teaches them methods of developing software behind Bitcoin, including the blockchain.

The family of Yee permanently relocated from Singapore to the Dandenong North suburb in Melbourne, Australia, to provide a better ecosystem for Seth, who has proven his talents in coding and software development over the past few months.

The emergence of young minds and developers who are exposed to the blockchain at an early age, including Seth, will allow the Bitcoin ecosystem and blockchain-based projects to evolve exponentially.

Microsoft's Coco To Speed Up Blockchains for Enterprise

Microsoft announced on August 10 a new technology looking to speed up blockchain-based systems and make them more private at the same time on the enterprise level.

Blockchains have always been very good at maintaining data integrity due to every participant in a network having their own copy of the ledger to verify all transactions, but this made it difficult for large businesses with strict privacy requirements to adopt the technology.

The system is called Coco Framework, which stands for Confidential Consortium. Coco will be made ready and open source by 2018 Microsoft is claiming. Coco would make it to where companies could control who was able to see what was on the network, without slowing it down. Microsoft is planning to offer Coco for free, in hopes that customers of the framework will use their cloud services as well.

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Stratis' TumbleBit Wallet Is One Step Closer

Mon, 08/14/2017 - 14:11

On August 10, the Stratis Platform team announced the attainment of a major milestone in the development of their Breeze Wallet, which is one of the first implementations of TumbleBit, a protocol to improve Bitcoin’s anonymity.

Stratis Marches Forward with Breeze Wallet

The new and improved wallet has been in testing since May, and is due for an imminent release, utilizing the TumbleBit protocol to provide enhanced privacy for cryptocurrency transactions conducted with the Breeze wallet. The Breeze Tumbler is expected to be used in commercial scenarios, for example, where businesses want to protect customer or sensitive data for competitive reasons.

The Breeze wallet is an ambitious project from the Stratis team, which was launched March 2017 and in less than a year, the wallet will have its alpha release. Adam Ficsor, one of the contributors to the original TumbleBit research paper, stated in March 2017:

“Everyone who is not using Bitcoin Core has already had all their addresses linked together by third parties. This is not a theoretical “assume the worst case” strategy, this is reality. The third parties are either the central servers your wallet relies on or in case of SPV wallets all Blockchain surveillance companies.”

Until a TumbleBit wallet such as Breeze is ready, it is best to hold your bitcoin in a full node for maximum privacy. With web wallets and SPV wallets, your identity is more at risk of being uncovered by third parties. The problem with traditional tumblers is that they frequently interact with the Bitcoin blockchain, which can be used to deanonymize users. TumbleBit solves two problems; how can we hide who sends from the tumbler? And how can we prevent the tumbler from stealing?

Enter TumbleBit...

To solve these problems, TumbleBit is based on David Chaum’s blind signatures. Let’s look at how one person, Alice, donates 1 bitcoin to another, Bob, through TumbleBit by formalizing the actions of the actors as follows:

Tumbler: I want to play a game, I created a bunch of puzzles. I pay 1 btc for every solution and I also solve any puzzle for 1 btc. So the Tumbler solves any puzzle, not just ones it created.

Alice: I use this game to anonymously pay Greg. I choose a puzzle and blind it. Then I make the Tumbler solve this blinded puzzle for 1 bitcoin. Once the Tumbler solves the puzzle, I unblind the blinded solution. Finally, I give the solution and original puzzle to Greg.

Bob: I can redeem this solution for 1 bitcoin from the Tumbler, according to Roger.

Alice blinds a puzzle, makes the Tumbler solve the blinded puzzle for 1 bitcoin, and unblinds the blinded solution. Alice then gives the original puzzle and the solution to Bob, and he redeems 1 bitcoin from the Tumbler with them. The key observation is as follows; when Bob and, say hundreds of other payees, come to redeem a bitcoin with their own solutions, the Tumbler cannot link together the blinded puzzles and blinded solutions, which it previously solved for Alice and the hundreds of other payers, with the real ones. This is the main idea behind TumbleBit’s anonymization technique.

Exploring TumbleBit Further

While we have explained how TumbleBit anonymizes payments, how does the Tumbler forward your bitcoin without the ability to exit scam on you? Digging deeper, there are similarities between TumbleBit and the Lightning Network. Stratis’ BreezeWallet is a bitcoin wallet that does not ruin full node-level privacy but not as cumbersome as a full node. Technically, it is also an unidirectional payment hub, similar to how the Lightning Network operates, where opening payment channels allows trustlessness. You can read more about the basics of payment channels here.

We can explain the three phases of TumbleBit for a better understanding; in the Payment Phase, off-blockchain payments take place. Secondly, the Escrow Phase sets up payment channels and finally, the Cash Out phase closes them down, where only these two phases require on-blockchain transactions.

Now suppose Alice wants to send bitcoin to Bob. Bob asks for a payment channel to be setup, where the Tumbler (T) escrows 1 bitcoin for a 2-of-2 multisignature transaction between the Tumbler and Bob, that is time locked for a certain time, say t. Then Alice escrows 1 bitcoin, time-locked for a specified time prior to t.

The next step for Bob is that he receives a cryptographic puzzle, as mentioned before, which occurs off-chain with the Tumbler. The output of the puzzle-promise protocol is a promise that T will pay Bob 1 bitcoin in exchange for the solution to the puzzle, z. The puzzle is just an RSA encryption of a given value. Solving the puzzle is equivalent to decrypting z and solving for the value. The promise part is a symmetric encryption key, which allows Bob to claim 1 bitcoin from T with the solution to the puzzle. It also ensures the Tumbler provides a proof that the puzzle solution is indeed the key that decrypts the 'promise' ciphertext.

Thirdly, once Alice indicates readiness to pay Bob, a random blinding factor is used to blind the puzzle, which ensures that not even the Tumbler can link the original puzzle to its blinded version. Bob sends the blinded version to Alice and he solves with T. This puzzle-solver protocol is a fair exchange ensuring Alice will send 1 bitcoin to T if and only if the Tumbler gives a solution to the puzzle. Then Alice sends the solution to the blinded puzzle back to Bob, who then unblinds the solution and accepts Alice’s payment if the solution is valid.

Then we get to the Cash Out phase, where Bob uses the puzzle solution to decrypt the ciphertext. With this, Bob can create a transaction that he signs and is signed by the Tumbler, which is then posted to the blockchain so Bob can receive 1 bitcoin from the Tumbler. The Tumbler could steal from Alice and not pay Bob, but we get around this as Alice signs claim 1 in the diagram below and Tumbler signs claim 2 at the same time with the use of hash locks, as mentioned previously, and hence explains why the 2-of-2 multisignature escrow between Bob and the Tumbler is longer than the time for Alice's escrow. Alice signs claim 1, Tumbler signs claim 2 before time t specified earlier, then Bob recieves bitcoin. 

 

How TumbleBit Benefits Bitcoin

From Roger’s perspective, we can see how TumbleBit can help scalability. For example, the Payer will escrow some bitcoins in the beginning phase, which are used to make off-blockchain payments to the Tumbler for solving puzzles. Suppose we want to make numerous payments, not just one, and we escrow Q bitcoin. Now for each puzzle the Tumbler solves, we sign an off-chain transaction, and give the Tumbler a new puzzle.

The Tumbler updates the balance but does not sign the transaction yet. More and more puzzles can be requested to be completed, and if Roger refuses to sign the transaction for the puzzle solved previously, the Tumbler will not solve any more puzzles. Each transaction in this stage is signed by Roger, but not by the Tumbler, which is required for the 2-of-2 multisignature to release the escrow and complete the payments.

Suppose we have transactions up to j bitcoin, for j<Q, for Roger. Now the Tumbler will claim its bitcoin for the escrow transaction by signing the transactions that sum to j bitcoin; as it is the only transaction to be signed by both the Tumbler and Roger, a cheating payer cannot steal the bitcoins. Moreover, it demonstrates that a payee can receive many transactions off-chain with just two on-blockchain transactions.

TumbleBit is exciting not just because of the privacy-augmenting features, but also because it requires many bitcoins to be put into escrow, so once widely used, it will act as a direct pressure on the price of bitcoin, as many units of the cryptocurrency will be locked away into escrow.

However, as outlined in the TumbleBit research paper, there are some weaknesses of the protocol, which could be researched further once the Breeze wallet is available. Payees have better privacy than the payers, as the the Tumbler knows the time t at which the payer sends each transactions, whereas only the aggregate number of bitcoins cashed out by the payee is known by the Tumbler. There is also the theoretical problem of collusion between payees and the Tumbler to uncover the identity of the payer.

In summary, the Stratis project is just over one year old and it is showing signs of progress, with a soon to be released privacy-focused wallet that can hold both stratis (STRAT) and bitcoin (BTC). As one of the first implementations of TumbleBit, it will mark a significant development for the scalability and privacy of bitcoin and cryptocurrency payments for businesses. Actual implementation of TumbleBit will enable the Stratis team to polish the protocol, explore any weaknesses and improve upon it further, demonstrating one way in which the progress made by altcoins is beneficial for the future development of Bitcoin.

What is Ripple (XRP) and is it a Good Investment?

Sun, 08/13/2017 - 11:34

The open-source nature of blockchain technology has allowed developers to create a wide range of new cryptocurrencies after bitcoin’s inception in 2009. Many of these new altcoins experienced large-scale user adoption and, therefore, grew substantially in market value. One of these altcoins is ripple.

What is Ripple?

Ripple is a payments protocol and a cryptocurrency that were created by San Francisco-based Ripple Labs in 2012. Ripple Labs is a venture capital-backed startup that has develops global payments solutions for financial institutions. In the past five years, Ripple Labs has created a real-time gross settlement system (RTGS), a currency exchange, and a payment network called RippleNet.

According to Ripple Labs, “Ripple connects banks, payment providers, digital asset exchanges and corporates via RippleNet to provide one frictionless experience to send money globally,” and all of its transactions are recorded on the decentralized XRP Ledger.

Ripple is also a digital currency and is native to the RippleNet payment network. Ripple carries the ticker XRP, is currently the fourth largest cryptocurrency in the market with a market capitalization of over $6.5 billion. Ripple is used in the Ripple payment network to make transitions, pay for transaction fees and is necessary to be kept as a reserve in wallet addresses that uses the network. Ripple transactions take less than four seconds and over 1000 transactions per second can be processed on the network.

If a company in the U.S. wants to pay a supplier in Mexico, it would normally need to pre-fund an account in Mexico or use an expensive money transfer operator that will take several days to complete the payment. Using ripple, however, the U.S.-based company, upon agreeing with the Mexican supplier to accept this form of transaction, can make the payment instantly and at a very low cost. The supplier then receives the ripples that can be turned into Mexican pesos using a ripple gateway.

At the time of writing this article, the price of one ripple stood at $0.168040. Ripple has been one of the best performing digital assets in 2017. Year-to-date, the return on investment for ripple holders has been over 2,500 percent. In May, ripple hit its all-time high when it peaked at around $0.40.

Ripple Labs has managed to become the leading blockchain technology provider for payments and settlement solutions for financial services companies and currently, has over 75 global banks and other financial institutions as clients.

Ripple’s Unpopularity in the Bitcoin Community

While ripple has grown into one of the most valuable digital assets in the market and has been around for much longer than most of its counterparts in the top ten cryptocurrencies, not everyone in the bitcoin community is a fan of ripple.

Bitcoin started out to provide financial sovereignty to individuals and to allow anyone to “be your own bank” as bitcoin’s popular slogan says. Hence, many bitcoin community members feel that ripple is going against the very foundation that cryptocurrencies were built on, which is decentralization and the disintermediation of financial institutions.

Ripple, instead, is “colluding” with the banks as it is helping banks drastically reduce costs on payments and remittances. This does not bode well with the die-hard “be your own bank” community members.

Furthermore, critics of ripple also highlight the cryptocurrency's lack of decentralization. While the XRP Ledger is decentralized, Ripple Labs has created all coins before the launch and still owns over half the total supply of ripple, which does not resonate well with the community’s affection with true decentralization.

Ripple’s Supply

A cryptocurrency's supply structure has a big influence on its price. Hence, it is important to understand how the supply for a specific currency is managed before investing in it.

All ripples have been created, and the total supply of coins is 100 billion. Currently, around 38.3 billion ripples are in circulation. The rest are still held by Ripple Labs.

According to an announcement by the company in May 2017, Ripple Labs plans to lock up over half of the supply of ripple (55 billion XRPs) and will release one billion ripples into the market each month for 55 months. This move is intended on releasing any uncertainty surrounding ripple’s future supply. In the statement, it also states that Ripple Labs has sold on average 300 million XRP each month for the past one and a half years.

The high number of ripples still held by the company was a major point of concern for ripple holders and potential investors. These concerns have now been addressed, but it is not yet clear how the price of ripple will perform once the new tokens start to hit the market and if there will be enough demand to meet the incoming supply.

Where to Buy And Store Ripple?

Ripple be bought and sold on most major cryptocurrency exchanges, including Kraken, Bitfinex, Poloniex, and BitStamp. The digital currency can also be bought cryptocurrency brokerage platforms such as Changelly or through the wallet provider and exchange GateHub.

GateHub is probably the most popular wallet for ripple holders as it not only allows you to store your coins but also provides an exchange where users can buy and sell ripples against a range of fiat and digital currencies. GateHub is used by both companies and individuals.

Other ripple wallets include Rippex, which is a desktop wallet for Linux, Windows, and iOS and the hardware wallet Ledger Nano S, which has been supporting ripple since May 2017. The latter is the most secure option for private individuals looking to buy and hold ripple as an investment as it allows for cold storage.

It is important to note that if users want to activate a ripple wallet, at least 20 XRP need to be deposited in the wallet for that to happen.

Should You Buy Ripple (XRP) as an Investment?

Whether you should invest in ripple or not comes down to whether you believe that Ripple Labs will be able to succeed in providing the go-to payment solution for the financial industry or not.

Currently, it looks like they are succeeding, which explains why the value of ripple has increased so much. Should RippleNet become an integral part of the financial industry or even the standard for interbank payments, then the value of the cryptocurrency will most likely skyrocket in the coming years to reflect this development. However, should Ripple Labs fail at this endeavor, then the value of ripple will most likely wither away in the coming years.

Another factor to take into consideration when looking at altcoin investment options is the fact that more and more digital currency-focused hedge funds as well as traditional institutional investors are popping up that will be buying digital assets in size. Due to the higher liquidity requirements that institutional investors need, it is very likely that most funds will purchase holdings in the largest and most liquidity cryptocurrencies on the market, i.e. the top ten cryptocurrencies. Therefore, ripple will likely benefit from institutional investor money flowing into digital assets.

Aside from the potential failure of Ripple Labs to complete its ambitious mission, the other key risk for ripple’s price development is the ample supply of the coins that is yet to hit the market. Should the demand for the digital currency not outstrip the new supply entering the market, then the currency will lose value in the coming four years. Having said that, ripple’ future supply management plan is now well-known, so you would expect this to be already priced into the value of ripple.

While ripple is not a crowd favorite in the bitcoin community, the cryptocurrency definitely has the potential to become a favorite among investors.

Bitcoin Price, Consistently Posting Record Highs, Approaches $4000

Sat, 08/12/2017 - 15:55

Bitcoin enjoyed large gains over the week, breaking the all-time high numerous times, and peaked at $3934.00 on the Bitstamp exchange during August 12's trading session. At the time of writing, the price of bitcoin is at $3867.84, up over six percent on the day. The recent price rise also brings the cryptocurrency above the three thousand threshold in British Pound and Euro terms.

It seems that bitcoin is gaining a reputation for being a safe haven asset, with mainstream media noting the negative correlation between bitcoin and global stocks amidst increased tension on the geopolitical stage. With few economic events or data releases, Trump's actions, or words, were most likely overemphasized in markets over the past week, with the market eagerly looking for any new information.

Bitcoin's rally is also boosted by the lock-in of SegWit, a scaling proposal and transaction malleability fix. While, on the the other hand, Bitcoin Cash experienced some problems with transaction malleability with exchanges and one of the developers committed to finding a non-SegWit solution to the problem. The hype and hysteria from the split has faded and the dust has settled; the teams will diverge and is healthy for the market, as indicated by the rising price of bitcoin. Moreover, the controversial split has brought greater attention from the general public to the cryptocurrency.

The hourly chart for BTC-USD is shown below, with a fractal resistance at $3934.00 confirmed. The most recent fractal support lies at $3695.17. As outlined by our weekly cryptocurrency market outlook, we suggested a buy position once the bullish saucer signal was triggered, highlighted on the chart below with the yellow ray at $3339.66. The market then went onto reach highs just below $3500, before pulling back to $3178.72 on August 9. The cryptocurrency quickly bounced back, with a bullish Ichimoku breakout on August 10 and by August 11, our initial target at $3622 was reached.

 

Over the short run, we examine the relation of the market price and the conversion line (blue), an important support at $3814.58 and gauge of short-term equilibrium. An hourly close below this level could point to an extended correction. However, BTC-USD is likely to return to this equilibrium and move higher, with similar behavior shown in preceding trading sessions. Usually, when the conversion line flattens in an uptrend, we should look to enter long positions once the market tests this support. Over the medium term, the Ichimoku cloud shows equilibrium to be around $3659 to $3768 for August 13, with this support zone indicating a good area to set buy limits.

With the Bullish Saucer just triggered this week, as shown below, we expect the upside momentum to remain strong in the weeks ahead. The extreme strength of the bullish momentum is also displayed by the conversion line, which is almost vertical. We expect the next target at $4270.80 to be reached within the next week or two, which is the 161.8 percent Fibonacci extension for the massive upward move from late March to mid-June.

Also, with just three near consecutive record highs posted since the fractal buy level at $1830 in July, bitcoin could keep surging higher until early November, when the next stage of SegWit2x is planned, that is a hard fork to 2MB which is opposed unanimously by Bitcoin Core developers.

Microsoft's Coco To Speed Up Blockchains for Enterprise

Sat, 08/12/2017 - 12:25

Microsoft, a company familiar with the cryptocurrency scene, announced on August 10 a new technology looking to speed up blockchain-based systems and make them more private at the same time on the enterprise level.

Blockchains have always been very good at maintaining data integrity due to every participant in a network having their own copy of the ledger to verify all transactions, but this made it difficult for large businesses with strict privacy requirements to adopt the technology.

The system is called Coco Framework, which stands for Confidential Consortium. Coco will be made ready and open source by 2018 Microsoft is claiming. Coco would make it to where companies could control who was able to see what was on the network, without slowing it down.

Microsoft is planning to offer Coco for free, in hopes that customers of the framework will use their cloud services as well.

Coco connects various blockchain networks in order to resolve some of the problems hindering its adoption, such as the aforementioned speed and privacy concerns. In addressing these two problems, Microsoft hopes that Coco will enable more enterprises to consider using the blockchain-based software.

"We expect this to be the foundation for blockchain for enterprise," Mark Russinovich, chief technology officer of Azure, Microsoft's cloud computing division, said at a press briefing. "We think blockchain is going to potentially transform every industry."

According to Tom Racette, Vice President, Global Retail Business Development at Mojix, Coco is already being tested across a range of industries:

"Being able to run our existing supply chain Dapp code much faster within Coco framework is a great performance improvement that will reduce friction when we talk about enterprise Blockchain readiness with our retail customers. Adding data confidentiality support without sacrificing this improvement is what will enable us to lead the digital transformation we are envisioning with Smart Supply Chains."

Currently compatible with Ethereum, whose cryptocurrency has skyrocketed to position number two in terms of market capitalization and a trading price above $300, Microsoft says Coco can make the already speedy Ethereum 100 times faster.

Coco is being built in partnership with Intel’s hardware, to be compatible with all types of blockchains. While Microsoft hopes businesses from all over adopt Coco, planned adopters include Corda, the blockchain of R3, Intel/Hyperledger blockchain Sawtooth, as well as JPMorgan Chase’s Quorum. Further details about the Coco framework can be found in the technical whitepaper.

Australian Government May Intensify 'War on Cash'

Fri, 08/11/2017 - 13:32

Australia’s Black Economy Taskforce (BET) has called for a war on cash and has revealed 35 different methods of eliminating cash. The taskforce placed the blame on the consumers for encouraging the use of cash, which is being manipulated and utilized by criminals to fund large-scale fraudulent organizations.

In an interview with News.com.au, the Australian federal government’s Black Economy Taskforce (BET) chair Michael Andrew explained that consumers are part of the problem and that the government will punish those that purchase products or services with cash:

“We intend to examine the merits of consumer-focused sanctions, including the loss of consumer protections, warranties and legal rights for people who make cash payments without obtaining a valid receipt. This is not simply of matter of imposing new penalties, but part of a wider cultural change agenda.”

In addition to drug traffickers and money launderers, the BET intends to regulate and crackdown on people that operate outside the tax and regulatory system of Australia. In order for the government to properly regulate the country’s financial system, Andrew noted that it needs to enforce strict rules on spending habits and usage of cash.

However, analysts and experts including Consumer Action Law Centre senior policy officer Katherine Temple criticized the submission of BET, stating that the enforcement of such policies are unrealistic and completely unfair toward consumers.

“Broadly we support efforts to combat the black economy because vulnerable or disadvantaged people are often victims, but we think punishing everyday Australians for businesses not complying with their obligations is completely unfair. Consumers can’t make rational payment decisions based on keeping rights that they aren’t aware exist. [Policy] that is based on the notion that a consumer will make payment decisions based on rational concepts sets an unrealistically high bar which most consumers should not be expected to reach,” Temple explained.

Analysts also criticized some of the inefficient methods proposed by the financial regulation arm of the federal government to integrate nanochips on A$50 and A$100 notes and establish short-term expiry dates on each banknote, as it would lead to a drastic increase in expenses and confusion for general consumers. Even though it is far from reality, such a consideration reinforces the attractiveness of bitcoin as a store of value and we are reminded of the demonetization in India, which led to an explosion in the use of the cryptocurrency.

Still, the federal government and BET intend to focus on the implementation of necessary policies to restrict and regulate the usage of cash. BET estimated the size of Australia’s black economy to be worth up to A$50 billion ($39.45 billion). Additionally, the government revealed that tax avoidance through cash costs the government over A$10 billion ($7.89 billion) annually.

In May, the Australian government announced the elimination of a tax on bitcoin and officially recognized bitcoin as money as a part of a larger initiative to encourage the development of bitcoin, the blockchain, and fintech.

“The Government will make it easier for new innovative digital currency businesses to operate in Australia. From 1 July 2017, purchases of digital currency will no longer be subject to the GST, allowing digital currencies to be treated just like money for GST purposes,” the Australian government wrote in its 2017/2018 budget for “Backing Innovation and Fintech.

More to that, the government stated that it would protect bitcoin and blockchain-related businesses, with the aim of evolving Australia into a leading global fintech hub:

“Innovation will drive productivity growth in Australia. That is why the Government’s A$1.1 billion ($0.868 billion) National Innovation and Science Agenda (NISA) is designed to enable Australia to take full advantage of new economic opportunities. The Government is committed to establishing Australia as a leading global financial technology (fintech) hub and is announcing a new package that aims to position our local fintech industry as a world leader.”

It is an interesting period for the Australian finance industry, as the federal government is trying to restrict the use of cash and move its economy toward fintech and bitcoin. In the upcoming months, regulation on cash may tighten significantly as demand for bitcoin continues to increase.

Korean Buyers Take Ethereum Beyond $300 Amidst Geopolitical Tremors

Fri, 08/11/2017 - 12:26

Since August 9, tensions between North Korea and the US have intensified, with South Korean traders piling money into the cryptocurrency of the second largest blockchain network, Ethereum. ETH-USD breached the $300 handle and now finds support at this psychological level; we provide an outlook for the cryptocurrency going forward.

While markets across the world have shown increased volatility in response to the war of words, cryptocurrencies have remained fairly stable, incubated from any threat of a war on the Korean peninsula. The drama started on August 9, when a US report was released claiming that the North Koreans had developed a minature nuclear weapon.

US President Trump threatened the small, communist nation with “Fire and Fury,” while the North Koreans hit back with a warning of a strike on Guam, a US military base, which is the Westernmost edge of their influence in the Pacific. A retired Russian general, however, does not see the US taking the offensive, as North Korea would most likely target Seoul and US assets in retaliation. While the US army is much more powerful, morale and readiness for battle is suggested to be greater among the army of North Korea. China has also weighed in, stating that an attack on North Korea would not be permitted and it would not stand by and watch. On the other hand, it stated its neutrality in the event the US is attacked first.

While in times of geopolitical uncertainty, assets like gold, US Treasuries and the Japanese Yen are sought after by investors, cryptocurrencies are beginning to steal the show. While stock indices fell across the board, this new asset class is rising to prominence, and has shown stronger resilience than more recognized safe haven assets in the past week. With the Cyprus bail-in, Brexit, and now the threat of another war breaking out, cryptocurrencies seem to be cementing their place as an asset to diversify with against geopolitical risk. Imagine, if South Korea is caught in the crossfire, as Seoul lies within the artillery range of North Korea, the South Korean Won would be hit hard, whereas the Ethereum network will still be running, with infrastructure spread across the world.

Ron Chernesky, CEO of InvestFeed, highlighted the use of cryptocurrencies as a hedge against a larger downturn in wider markets:

“We’re seeing investors transferring their funds into cryptocurrencies as they try to diversify their risk in case of a severe downturn in the market. The space has gone from niche to more widely adopted with one of the main draws being that cryptocurrencies are seen as less correlated with other assets.”

As the news about North Korea permeated around the world, ether enjoyed higher volume, surpassing $2.5 billion on August 9, which was significantly larger than the volume for the most popular cryptocurrency, bitcoin.

Ether is favoured by Koreans since Vitalik Buterin made an effort to put a face to the cryptocurrency; as a result, ether has gained trust among investors in the country, compared with bitcoin, whose creator remains anonymous. But not only are investors in the country buying frequently, they are betting big on the digital asset, as explained by Bobby Kim, trader and advisor on Bitcoin Seoul:

“When I started buying bitcoin, I noticed a huge difference between the orders in the U.S. and Korea. In the U.S., they trade around $100 up to $5,000 to $10,000 per trade. In Korea, these trade amounts are in $100,000 increments.”

The children of the “chaebol” conglomerates are the ones putting huge bets on cryptocurrency, investing their inherited riches. The huge volume increase saw ether rise to a fresh high against the Korean Won, above 363,000. In dollar terms, ETH-USD broke above the $300 handle, peaking at $315.12 on August 9. The price of ether has since retreated to the $300 handle. The chart below shows that as the news broke about North Korea’s supposed nuclear capability, volume increased on the Korbit exchange, which has a market share of around 6 percent of the entire ether market. Buyers managed to push ether up from 337,200 to 363,050 in just a few hours.

ETH-KRW also spiked later in the day as the Pentagon chief threatened the “rogue state” with the destruction of its people, with ether peaking around 351,450 against the Won. For ETH-USD, the cryptopair reached a fresh high at $316.92 in the rising heat of geopolitical tension.

The daily chart for ETH-USD is shown below and illustrates a bullish outlook for the cryptocurrency. We look to buy around the upper span of the Ichimoku cloud, which provides initial support around $269. Notice that the two previous candlestick are Doji’s, suggesting some indecision in the market, hence why we may see ETH-USD retreat to find a new floor around $270, before continuing higher. The Ichimoku cloud is also changing color, from red to green, providing an indication that a new uptrend is underway, confirmed with a breakout above the Ichimoku on August 6.

Support also lies at the conversion line ($267.24) and the base line ($235.46). Finally, notice that the lagging line has followed the price action, and is currently above the Ichimoku cloud, giving another bullish signal.

The 4-hour price action is displayed below, with a key support at $297.50. A 4-hour close below this level will open up the support provided by the base line, at $288.51. We look to buy if the market dips to this level. On the other hand, a break above the fractal resistance at $312.97 will point to further gains in the days ahead.

If ether manages to sustain above the $300 handle, we should see the bullish run continue, with a viable target at the all-time high above $400, which is the last remaining fractal resistance on the weekly timeframe. Hence, if ETH-USD remains above $271 by August 14, we should see the market take an attempt at $404.98.

8-Year-Old Computer Prodigy Programming ‘WoorannaCoin’ to Grasp the Blockchain

Thu, 08/10/2017 - 19:47

A group of elementary students, including eight-year-old computer prodigy Seth Yee, at the Wooranna Park Primary School in Australia work on programming ‘WoorannaCoin’ under the guidance of former network engineer Kieran Nolan, which teaches them methods of developing software behind Bitcoin, including the blockchain.

The family of Yee permanently relocated from Singapore to the Dandenong North suburb in Melbourne, Australia, to provide a better ecosystem for Seth, who has proven his talents in coding and software development over the past few months.

According to Seth’s father Ray, the family first discovered Seth’s extraordinary talents when he completed the development of virtual spaceships on a NASA program at the age of six. Two years later, the family permanently relocated to Australia, where Seth met former network engineer Kieran Nolan and completed the development of a cryptocurrency along with grade five and six students.

WoorannaCoin, a cryptocurrency developed on top of a platform allowing young developers like Seth to create prototypes and mock alternatives to Bitcoin, has no actual value. But, Nolan, teacher at Wooranna Park Primary School, explained in an interview with The Standard that the cryptocurrency development program was crucial for the school’s elementary school students and computer prodigy Seth in understanding encryption, cryptography, and security.

By building a transparent voting system, the young students are learning about the blockchain with a hands-on approach. More importantly, Nolan emphasized that the development of a cryptocurrency was important as it also teaching the next generation financial literacy, a frequented criticism of the education system in many countries.

“I think it is going to be as important as coding in schools in the coming years. It's a way of teaching financial literacy, digital literacy... it teaches students how networks talk to each other. If students don't have these skills now, schools are doing them a disservice. If you only look at numeracy and literacy, that won't get someone a job in the future, they need to have these skills,” said Nolan.

The Wooranna Park Primary School has already gained recognition from the technology industry and community. In his first visit, US-based software developer and investor Andrew Kwon donated 21 bitcoin ($30,000 at the time) to the school, after recognizing the talent pool of young developers and coders the school housed. According to The Standard, Kwon’s investment was the first bitcoin donation to an Australian school, and on top of that, Kwon donated computer hardware for the new high-tech center, virtual reality goggles, 3D printers, Microsoft HoloLens, programmable robots, and drones.

In just over three years, the blockchain and Bitcoin industries have evolved into multi-billion dollar markets. Major conglomerates and large-scale companies including IBM, Microsoft, and Visa, are actively looking for blockchain and Bitcoin developers but according to various surveys and reports, the industry is struggling to find talents within the blockchain sector.

At the DTCC's Fintech Symposium in March 2017, Linux Foundation-led Hyperledger project executive director Brian Behlendorf stated, "the tech recruiting is very thin. So, recruiting is hard.”

Some analysts and experts went as far to describe the talent gap and lack of developers within the blockchain sector as the two main factors preventing the mainstream adoption of blockchain technology.

“It is clear that many financial services firms are either seriously considering how to utilize blockchain within their organization or are already putting this technology into practice. However, as with any new technology, there are challenges to be overcome. Our survey shows that recruiting the right people is one such challenge, regulation is another, and technical considerations related to the technology itself another,” Synechron CEO Faisal Husain stated.

The emergence of young minds and developers who are exposed to the blockchain at an early age, including Seth, will allow cryptocurrencies and blockchain-based projects to evolve exponentially.

Blockchain Startup Uses Hybrid Intelligence to Disrupt International Finance

Thu, 08/10/2017 - 18:42

Artificial intelligence has been around for a while now. Even though it hardly resembles sentient computers seen in sci-fi movies, it has found numerous use cases in businesses and the sciences. Neural networks and deep learning have made it possible for computers to process huge amounts of data and even successfully mimic human behavior.

Using artificial intelligence for financial markets isn’t news either. Computers processing big data and returning some predictions are among the most popular solutions for professional traders and brokers. However, the efficiency of such solutions can be surprisingly low sometimes.

This all may change if artificial intelligence is combined with the collective intelligence of human beings.

The Collective Intelligence Phenomenon

In 1906, British scientist Francis Galton found himself at a fair where visitors were offered to guess the weight of an ox. With nearly 800 people participating in the lottery, their guesses were fairly different, especially considering the fact that there were either professional farmers and townsmen who knew nothing about agriculture. Surprisingly enough, when Mr. Galton calculated the direct average of their guesses, it turned out to be 1,197 lbs, while the actual weight of the bull was 1,198 lbs.

This instance demonstrates the phenomenon of collective intelligence; with a vast selection of people, their average prediction often proves to be correct, or a close approximation. Most notably, the selection has to include both professionals in the field and those who have no idea of what is going on. If only one of such groups is present, the results will be biased and most likely far from correct.

Collective Wisdom at the Service of International Finance

Even though such an approach has proved its efficiency on numerous occasions, there have been only a few projects that opted to use it in combination with artificial intelligence directly.

One of them is Estimize, a service that gathers market estimations from professional finance experts, and then processes it with its AI system to return a consensus prediction.

The method proved to be quite trustworthy, and, according to the service’s website, is usually at least 74 percent more accurate than data sources commonly used on Wall Street.

The service has been around for more than five years and has garnered considerable recognition within the professional community.

Another notable project is Cindicator, which has gone a bit farther, and uses the collective intelligence of a random selection of people from around the world.

What makes it stand out, even more, is that it uses cryptotechnologies to bring decentralization to the entire process, and lay a foundation for a decentralized autonomous organization where humans and machines work together.

Synergy of Humans and Machines

Cindicator claims that centralization poses the biggest problem for today’s financial analytics. The reason why professional analysis often proves to be wrong is down to the mutual influence of different opinions and isolation of the professional community. Only a handful of professional analysts offer their forecasts and predictions, so the selection of opinions is not very large.

On the other hand, Cindicator uses an app to collect unbiased predictions from people around the world who have different professional backgrounds, education, gender, political views and so forth. This ensures that the selection of forecasters will be sufficiently randomized, and therefore the laws of collective intelligence will come into effect.

Users are incentivized not only by money (which, of course, is still an important part of the model), but also by gamification of the entire process, and, most importantly, by the involvement of forecasters in transactions and investment. This ensures that the forecasters feel their responsibility and in the long run promotes the model of futarchy, which is deemed perfect for decentralized autonomous organizations.

When the predictions are made, artificial intelligence comes into play. It uses various mathematical models in order to make a single and rock-solid prediction as to the outcome of a certain event.

The system has been tested by a score of banks and hedge funds and proved to be much more reliable, inexpensive and accurate than traditional financial reports compiled by individuals.

Conclusion

The combination of human and machine wisdom could prove especially valuable for traders and other financial experts as they deal with the most volatile ecosystem where a single mistake could cost millions of dollars.

In sci-fi novels and movies, a motif of a merger between the human mind and artificial intelligence is commonplace. It is suggested that it could create a brand new form of interaction, and bring about processing efficiency never seen before.

While this might be only the first steps in this direction, such a symbiosis has already proved that it can hold a great promise for the world of tomorrow.

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