This ‘Faketoshi’ Signature Tool Lets Anyone Become Satoshi Nakamoto

This ‘Faketoshi’ Signature Tool Lets Anyone Become Satoshi Nakamoto

Over the years, it’s become popular to claim that you are Satoshi Nakamoto even if you lack a shred of evidence. Although some individuals have tried really hard to prove it, they have always failed to convince the greater community. For instance, a few self-proclaimed inventors of Bitcoin have attempted to generate a signature with a message hash that’s tethered to an early mined block. After a few of these occurrences, a financial transparency startup called Albacore Labs has created a tool that will validate a signature against the genesis block, making it “easier for other people to make similar claims.”

Also Read: Another ‘Satoshi’ Steps Out of the Woodwork, Calls Craig Wright a Liar

Crypto-Babble About Digital Signatures or Hashing Should Not Be Enough

Many bitcoiners will never forget how Craig Wright tried to prove he was Satoshi Nakamoto back in 2016. It all started when the London Review of Books reporter Andrew O’Hagan spent months with Wright and allegedly saw him sign a message tied to a Satoshi Nakamoto address. There was also a series of blog posts Wright wrote that has since been scrubbed from the internet and Wright’s interaction with Gavin Andresen in London. Back in the spring of 2016 Wright also appeared on a BBC video claiming to sign a signature tethered to the first bitcoin transaction.

“My name is Craig Wright and I’m about to demonstrate a signing of a message with the public key that is associated with the first transaction ever done on Bitcoin,” the Australian native stated on May 2, 2016. “So you are going to show me that Satoshi Nakamoto is you?” the BBC reporter asked at the time. “Yes,” Wright replied.

This ‘Faketoshi’ Signature Tool Allows Anyone to Become Satoshi Nakamoto
Two men who have claimed to be Satoshi Nakamoto but have yet to provide solid evidence. ‘Satoshin,’ left, and Craig Wright.

After the show aired, veteran cryptographers quickly pointed out that the BBC reporters and Andrew O’Hagan were seemingly duped. The long-winded London Review of Books story that describes O’Hagan’s experience hanging out with Wright for months shows O’Hagan had no clue what Wright was actually signing. Moreover, well-known cryptocurrency developers like Pieter Wuille, Christopher Jeffrey and Greg Maxwell showed the public how Wright pulled off his signing parlor trick.

This ‘Faketoshi’ Signature Tool Allows Anyone to Become Satoshi Nakamoto

One of the so-called Satoshi PGP keys Wright signed was provably backdated and other signature attempts have been cited as blatant forgery. Then, last year, a Twitter handle that used the name “Satoshi Nakamoto” tried to create the same signing proof with a message tied to block number 9. Finally, Bitcoin Cash (BCH) developer Amaury Séchet recently shared a hash message on Twitter and claimed to be Satoshi. However, the message was clearly a joke except a few cryptocurrency news outlets ran with the story.

This ‘Faketoshi’ Signature Tool Allows Anyone to Become Satoshi Nakamoto
Last November a Twitter handle called @Satoshi tried to sway the community with a signed message tethered to block 9.

Now Anyone Can Prove They Are Satoshi By Signing a Message Tied to the Genesis Block

Since the so-called block 9 signing, Albacore, a team that develops tools to improve financial transparency, has released an application that can tie a message to the Bitcoin genesis block so anyone can attempt to “prove they are Satoshi.”

“With everyone seemingly trying to prove they are Satoshi (looking at you Craig Wright and “Faketoshi twitter”), we’ve decided to make it easier for other people to make similar claims,” explains Albacore.

The startup’s Faketoshi website continues:

Clicking the button below will generate a signature and message hash that will successfully validate against the address that mined the genesis block, which is known to have been mined by Satoshi. Just don’t ask for the plaintext message that generated the hash…(spoiler, we don’t know it either).

This ‘Faketoshi’ Signature Tool Allows Anyone to Become Satoshi Nakamoto
Albacore’s Faketoshi tool.

A Faketoshi Signing Tool Benefits the Community by Teaching Bitcoiners to Dismiss Fraudulent Behaviour

In a post that describes the tool’s process, Albacore says people claiming to be Satoshi is nothing new, but Craig Wright is the most “recent cult” following. Albacore says this is due to a serious lack of technical understanding within the blockchain and bitcoin ecosystem. “This leads to situations where the merest mention of crypto-esque jargon like digital signatures or hashing is convincing enough,” the startup’s blog post explains. Albacore notes that people can see that the forged messages are clearly faked because the hash of the message is provided without the actual plaintext message.

This ‘Faketoshi’ Signature Tool Allows Anyone to Become Satoshi Nakamoto
“The inputs and outputs of the ECDSA signature and verification operations. Note that in both, the input is the plaintext message that is then hashed within the boxes (the ECDSA algorithm),” explains Albacore. 

“So why would the scammer provide the hash of a message and not the message itself? Albacore asks within the essay, before answers its own question: “Because they do not know the message — That would involve them actually knowing the private key and generating a legitimate signature.”

Albacore adds:

Given the one-way nature of cryptographic hashes — The only way to verify this signature is to use a non-standard ECDSA verifier that does not internally hash the message but instead accepts the hash of the message as an input.

This ‘Faketoshi’ Signature Tool Allows Anyone to Become Satoshi Nakamoto
Albacore believes the greater community needs to be more vigilant towards pretenders and faked signature attempts.

This week, news.Bitcoin.com reported on another self-proclaimed Satoshi Nakamoto who called Craig Wright a “liar” and stated he could sign a real message in due time. However, just like the slew of other Faketoshis we’ve covered in the past, this one has yet to provide any real proof to the greater crypto community. To some people, these signatures are pretty much meaningless, unless the signer can provide an actual plaintext message or literally move bitcoins that were mined in the early days with a well-known Satoshi address. Even Wright’s open letter saying that he is willing to testify in front of the U.S. Commodity Futures Trading Commission (CFTC) is worthless because none of those regulators understand this technology.

Albacore says tools like the Faketoshi signing application benefit the community as a whole, so they can be more critical towards people attempting blockchain signature parlor tricks and instead “focus on things that advance the space as a whole.”

What do you think about Albacore’s Faketoshi signature tool? Do you think anyone has proven themselves to be Satoshi Nakamoto with these signature tricks? What would make you believe a person is really Satoshi? Let us know what you think about this subject in the comments section below.


Image credits: Shutterstock, Twitter, Pixabay, Albacore, Medium, and Bitcoin.com. 


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Jamie Redman

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Binance Booted From Top Exchange Spot During January Lull

As total cryptocurrency trading volumes declined during January, Binance, Huobi and Bitfinex have now suffered significant month-on-month declines in volume over the last three months, according to CryptoCompare’s latest monthly Exchange Review. Indeed, following a 15% drop off in crypto trading via its platform, Binance has now been displaced as the top volume exchange according to the data aggregation site.

Taking Binance’s place at the top of CrytpoCompare’s volume charts is, ZB.com, the somewhat controversial China-based exchange (with an eye to following its main competitor Binance to Malta), which experienced a 6.2% increase in business, bucking the general trend of the quieter January crypto scene. ZB managed a total volume of $19.6 billion, according to CryptoCompare’s numbers, at an average daily volume of $633 million. Binance totalled $17.5 billion for the month, with OKEX around a billion behind it. 

Top Exchanges by Volume

Among the major exchanges, Huobi Pro’s monthly volume slipped below the $10 billion mark for the first time since CryptoCompare began compiling the report, dropping from almost $12 billion in December to around $5.6 billion. Bitfinex, however, appears to have fared the worse in recent months, having seen close to $12 billion in volume during November, it fell to under nine in December, and lost almost half of that during January, leaving it outside of the Top 10. 

Top Exchange by Volume

In Autumn of last year, Blockchain-watchers began to call into question the volumes on ZB.com, with a CER report on the exchange’s “magic volume” alleging its teams “found definite patterns of unnatural and obviously artificial trade volume performance on 10 out of the top-20 most-traded exchange’s pairs.” 

Even during January, one particular day of trading in QTUM – where the volume spiked to USDT 120 million – raised eyebrows. You can see the spike clearly on the CryptoCompare chart. 

CryptoCompare ZB QTUM spike

 

However, another contributory factor to the rise of ZB appears to be a marked downturn in trading volume for exchanges that offer fiat pairs; volumes on those exchanges decreased by 26.5% in January, while crypto-to-crypto exchange volume decreased by just 7.2% in comparison. In general, the crypto-to-crypto exchanges represent a much larger market, with at total trade of $132 billion during January compared to $37.5 billion for those offering fiat trading pairs – meaning fiat-crypto trading represented 22% of total spot volume during the month, down from 26% in December. 

BTC-currency trading volumes

Indeed, trading in Tether (USDT) – though decreasing – still dominates the crypto space as a whole, accounting for 65% of the total business across all the exchanges aggregated by CryptoCompare. Its share is up slightly on December, corresponding to a marked reduction in US dollar trading. Interest in Japanese Yen pairs rose, according to the numbers, while other options remained relatively stable. 

While Tether’s share of the entire market rose, its dominance of the Stablecoin sector took another chip. While usage of Gemini’s GUSD and Circle’s USDC appeared proportionately steady, it would appear that PAX confirmed itself as the main pretender to Tether’s throne, with another month-on-month move into it’s market share. Admittedly, it has a long way to go, as Tether still accounts for 97.6% of all stablecoin-crypto trading, but from a standing start in October, PAX now holds nigh-on 2% of the sector. 

 

Stablecoin market share

Away from the main exchanges, the interest in Decentralised options remains negligible. DEX’s account for just 0.19% of all crypto volume in January, with Ethermium remaining the number on choice, followed by WavesDEX and Open Ledger. The combined market, however, totalled just $385 million for the month. 

Mark Zuckerberg Considers Blockchain Authorization of Data in Recent Interview

Facebook CEO and founder Mark Zuckerberg considered the ramifications of blockchain-based authorization of user data during an interview with Harvard Law professor Jonathan Zittrain on Feb. 20.

During a discussion covering such topics as the future of technology and society, Zuckerberg noted that he “think[s] about the work we [Facebook] are a decentralizing force in the world.” Zuckerberg said that people of his generation got into technology because “it gives individuals power, and is not massively centralizing.”

Zuckerberg mentioned that he was considering a potential blockchain use case by which users could have control over their data, adding “Basically, you take your information, you store it on some decentralized system and you have the choice to log into places without going through an intermediary.”

He noted that while the “relatively computationally intense” processes of decentralized technology could eventually be overcome, there are also moral implications.

“I think the more interesting questions there are not feasibility in the near term, but are the philosophical questions of the goodness of a system like that one,” Zuckerberg said. He stated that a decentralized system may give users more control over their data, but could also lead to more abuse, and any recourse would be far more difficult than on a centralized system.

Zuckerberg said that one example of how the company is moving toward a more decentralized structure is through offering encryption in its messaging services. Zuckerberg outlined the benefits of encryption like privacy and security, but further stressed the importance of safety given that “people rightfully have an expectation of us [Facebook], that we are going to do everything we can to stop terrorists from recruiting people or people from exploiting children.”

Earlier this month, Facebook reportedly acquired Chainspace in its first apparent blockchain-related acquisition. The startup was reportedly working on blockchain scalability problems, notably by applying sharding to smart contracts. Facebook, however, reportedly acquired the startup primarily for the skills or expertise of its staff, rather than the service or products the company provides.

Insanity: Ethereum Wallet Pays Nearly $575,000 in Fees to Transfer $25 in ETH

Strange things occur in the cryptocurrency market. Prices spike following negative news, and positive news is met with a strong sell-off. Cryptocurrency exchange founders are accused of faking their own deaths and making off with their customer’s assets. But not much is stranger than seeing someone pay over $300,000 in fees to send a mere fifteen bucks worth of Ether.

Recent transactions have been discovered on the Ethereum blockchain that show a transaction for 0.1 Ether, valued at approximately $14.80 at the time the transaction was sent by paying 2,100 ETH in fees.

Mysterious Ethereum Account Sends 0.1 Ether, Pays 2,100 ETH in Fees

The cryptocurrency community is running wild with speculation as to why a mysterious Ethereum wallet sent 0.1 ETH while paying an astronomical 2,100 ETH in fees. The fees total over $302,000 at today’s Ethereum price of $144, while the Ether itself that was sent is just a measly $14.40.

At first glance, the sender appears to have made a user error, incorrectly swapping the transaction fee with the full value they were attempting to send. Crypto users commonly make mistakes when sending crypto to one address to another, occasionally even sending crypto to the wrong asset type or wallet address. It’s the reason it is always recommended users double- and even triple-check the receiving address before hitting send and signing a transaction.

Related Reading | Crypto Analyst: Investing in Ethereum Could Be More Profitable Than Bitcoin

Taking a journey down the rabbit hole of an Ethereum wallet, keen-eyed crypto users discovered that this wasn’t the only transaction like this example. In just one day, the wallet address sent 0.170000000000000002 ETH or roughly $24, for a total of 3990.00000000000004 ETH in fees. The fees total nearly $575,000 at today’s prices.

The account either has money to burn, is driven by a malfunctioning bot, or potentially has an ulterior motive. What that motive is, though, is yet to be understood, however, crypto sleuths everywhere are on the case.

Are the Strange Ethereum Transactions Tied to Money Laundering?

Some speculate that the high amount of fees are being used to launder money in some way. The Twitter account for the decentralized exchange Saturn Network explains how the transaction fees could be used to wash dirty funds so they appears as “honest miner income.”

The transaction wasn’t publicly broadcasted, which could suggest that the block the transaction was in was mined by a complicit miner.

Related Reading | Etheruem Rally Takes a Break, Still Bullish Above $144

Whatever the case may be, the wallet is either sending these transactions on purpose for one reason or another – potentially to launder money – or is repeatedly making some extremely expensive mistakes. One thing is for sure: these transactions were sent with some of the fastest speeds the Etheruem blockchain has seen.

Featured image from Shutterstock

‘Very Difficult’ to Call Bitcoin’s Bottom Says Crypto Hedge Fund Manager

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Alex Sunnarborg, the founding partner at Tetras Capital, a New York-based digital asset hedge fund with reportedly $30 million of assets under management (AUM), has argued that the prices of most major cryptocurrencies are still strongly correlated.

Sunnarborg, a finance graduate from the University of Florida, revealed that his firm, Tetras Capital, had shorted ether (ETH) in May 2018 – when the token was trading at around $500.

Confirming that it was his company’s “biggest win for 2018″ (as ETH is now trading below $150), Sunnarborg told Forbes in an interview (published on February 19th) that cryptocurrencies “don’t have a good way to come to a fundamental value.”

Crypto Prices Still Strongly Correlated, No Way To Call Bottom 

He explained that there is no (reliable) way for him to tell if ETH is “fundamentally going to bottom at $50” as Ethereum’s native token was trading for only worth about $10 two years back.

Sunnarborg believes ether’s “short-term bottom would be in line with” bitcoin’s bottom and that if the flagship cryptocurrency “turned tomorrow and rallied”, then “ether would, too.”

According to the former research analyst at Coindesk, altcoins “generally will return more than bitcoin” in a bull market. He also shared his firm’s trading and investment strategy:

In a bear market, altcoins are still trading at a higher beta, but to the downside. In 2018, bitcoin fell about 75%, but altcoins fell 95%. [Their prices are still] strongly … correlated, yet altcoins have a higher beta. Today, if we’re trying to hedge our exposure to this space, before we short bitcoin we look at something with a higher beta.

Millions Invested In Augur, But Only $40,000 At Stake Across All Its Markets

When questioned about whether the recent layoffs and downsizing by ConsenSys, the leading Ethereum-related development firm, is a “bad sign for the future of Ethereum”, Sunnarborg acknowledged that it could potentially slow things down – as “ConsenSys is an integral piece of the Ethereum ecosystem.” He also pointed out that there were tens of millions of dollars invested in creating Augur’s decentralized prediction markets. However, there’s only about “$40,000 of money at stake across all its prediction markets.”

This shows that there’s “this massive disconnect between how much money is still tied up in these projects and how much people actually use them”, Sunnarborg argued.

Bitcoin Surpasses $4,000 Mark After Six Weeks

When asked about whether he thinks “bitcoin has bottomed yet”, Sunnarborg remarked:

I don’t think so, [but] calling that is very difficult. … I’m [just] really thankful that we’re in the position we are right now. We can hedge ourselves, remain more neutral and not have to call that exact price or timing bottom. I’m not confident right now. Our portfolio is relatively neutral—we have cash and short positions.

Although cryptocurrency prices are down significantly from their all-time highs – when the total market cap of all digital assets exceeded $800 billion in early 2018, there have been some signs of the market starting to recover. On February 19th, bitcoin, the flagship cryptocurrency, surged past the $4,000 mark for the first time in six weeks.

The bitcoin price is also on track to record its first green monthly candle in six months.

Analysts Expect Ethereum (ETH) to See Increased Bullish Momentum as Crypto Markets Trade Mixed

The crypto markets have experienced decent levels of bullish momentum over the past couple of weeks that has allowed virtually all major cryptocurrencies to recover some of their recent losses. Ethereum (ETH) is one notable gainer that has jumped nearly 45% from its monthly lows and has firmly reclaimed the number two spot by market capitalization from XRP.

Analysts now concur that Ethereum will likely see increased bullish momentum in the near future, which may allow it to climb towards the upper-$150 region.

Ethereum Climbs Slightly as Crypto Markets Experience Mixed Trading Session 

Most cryptocurrencies have traded mixed today, with Litecoin and EOS both climbing over 5%, while other cryptos have dropped marginally.

At the time of writing, Ethereum (ETH) is trading up slightly at its current price of $147.3. Over the past seven days ETH has climbed significantly from lows of roughly $120. Prior to its upwards move this past weekend, Ethereum had experienced another upwards leg that sent it to $120 from lows of $103.

Although this upwards ascent has slowed slightly over the past couple of days, analysts are now anticipating that Ethereum will see increased bullish momentum in the near future.

Galaxy, a popular cryptocurrency trader on Twitter, recently noted that ETH will be “highly bullish” if it is able to break above $160, which would likely lead to further gains.

“Highly bullish on $ETH if we manage to break 160$ and produce the first higher high on a 1D or bigger timeframe, since June 2018,” he bullishly noted.

Gat, another popular analyst on Twitter, shared a similar sentiment to Galaxy, noting in a string of tweets that ETH is currently seeing a strong hidden bull diversion on a four hour time frame, which could lead it into the upper $150 region.

“$ETH looking strong IMO… looking for a breakout and move to high 150’s… Strong hidden bull div on 4hr.”

Gat further noted that an upwards move of any significance will require a greater amount of volume than ETH currently has.

“All of these charts I posted require some volume, which if you notice is coming in at resistance… bull vs bear fight, price action will show which side wins, volume shows the fight,” he explained.

Despite Widespread Bullish Sentiment, ETH May Drop Lower Before Surging

Although most analysts agree that there is a strong case to be made for continued bullishness, another analyst points out that ETH may drop towards the upper-$130 region before finding enough buying pressure to propel it towards $160.

“$ETH Update: Pull back now in play as anticipated from previous tweet… Scalp short triggered at $144.8, will consider longing again at support,” Altcoin Psycho told his nearly 30k followers in a recent tweet.

As Ethereum begins picking up momentum in one direction or another, traders will likely gain greater insight into whether or not ETH will be able to hold steady at its current prices, or if further losses are necessary in order for it to climb higher.

Featured image from Shutterstock.

Quadrigacx Cold Wallet Was Stored in a Safety Deposit Box

Quadrigacx Cold Wallet Was Stored in a Safety Deposit Box

In a 2014 appearance on the True Bromance Podcast, Gerry Cotten, the late CEO of embattled Canadian cryptocurrency exchange Quadrigacx, made comments indicating that the exchange was storing customer funds using paper wallets. Cotten also compared losing the private keys for a bitcoin wallet to “burning cash.”

Also Read: Market Cap: A Flawed Ranking System for Valuing Crypto

Cotten Discusses Cryptocurrency Custody During 2014 Podcast

With Gerry Cotten having supposedly comprised the sole individual tasked with managing Quadrigacx’s keys, the roughly $195 million in funds owed to 115,000 of the exchange’s customers has dominated the cryptocurrency news cycle in recent weeks.

While speaking on a podcast published March 12, 2014, Cotten stated that the exchange held its customers’ funds offline using paper wallets. He said: “At Quadrigacx, we’re obviously holding a bunch of bitcoins that belong to other people who have put them onto our exchange. So what we do is we actually store them offline in paper wallets, in our bank’s vault in a safety deposit box, because that’s the best way to keep the coins secure.”

Quadrigacx Cold Wallet Was Once Stored in Safety Deposit Box

Quadrigacx Keys Might Be Held in Safety Deposit Box

Citing the benefits of paper wallets, Cotten continued: “Essentially we put a bunch of paper wallets into the safety deposit box, remember the addresses of them. So we just send money to them, we don’t need to go back to the bank every time we want to put money into it. We just send money from our Bitcoin app directly to those paper wallets, and keep it safe that way.”

Cotten asserted that the best way to store one’s private key is to ”print it off, store it offline in your safety deposit box, vault, whatever, and then take the public key, which is your address, and use that to send money to it. So that way you can never have your bitcoin stolen, unless someone, like, breaks into the bank, steals your safety deposit box and gets into your private key and so forth.”

Losing Private Key Akin to ‘Burning Cash’

Quadrigacx’s cofounder compared losing the private key to bitcoin wallet to “burning cash,” adding “Even the U.S. government, with the biggest computers in the world, could not retrieve those coins if you’ve lost the private key. It’s impossible to retrieve those.”

Quadrigacx Cold Wallet Was Once Stored in Safety Deposit Box

What is your opinion on the current Quadrigacx fiasco? Share your thoughts in the comments section below!


Images courtesy of Shutterstock


At Bitcoin.com there’s a bunch of free helpful services. For instance, have you seen our Tools page? You can even lookup the exchange rate for a transaction in the past. Or calculate the value of your current holdings. Or create a paper wallet. And much more.

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Samuel Haig

Samuel Haig is a journalist who has been completely obsessed with bitcoin and cryptocurrency since 2012. Samuel lives in Tasmania, Australia, where he attended the University of Tasmania and majored in Political Science, and Journalism, Media & Communications. Samuel has written about the dialectics of decentralization, and is also a musician and kangaroo riding enthusiast.

Report: Bank of China Joins New Blockchain Platform for Property Buyers

Property development firm New World Development and the Hong Kong Applied Science and Technology Research Institute (ASTRI) will jointly launch a blockchain platform for home buyers with the Bank of China reportedly being the first bank user. The news was announced by local news outlet the Standard on Feb. 20.

The platform reportedly aims to replace paperwork operations — such as signing the Provisional Sale and Purchase Agreement or a mortgage application — with digital authorization. This will supposedly allow users to send the purchaser’s authorized, encrypted and digitally signed provisional agreement to selected banks.

Integration of distributed ledger technology (DLT) into organizations’ internal processes is estimated to help reduce banks’ operating costs by 15 to 60 percent, while the platform itself expects to see an increase in the number of users.

ASTRI CEO Hugh Chow reportedly said that DLT could reshape property market operations, resulting in efficient and flexible property buying procedures, while the HKMA argued that DLT “allows all […] users in the ecosystem to share customer information and transaction histories securely over a distributed data infrastructure, without compromising customer privacy or sensitive business information.”

Last August, Bank of China — one of the four largest state-owned banks in China — partnered with financial services corporation China UnionPay (CUP) to jointly explore blockchain technology applications for payment systems. Within the initiative, CUP was set to build a unified port for mobile integrated financial services, where cardholders will be able to use a QR code to spend, transfer and trade on a cloud flash payment app.

In January, China’s self-regulatory bank organization, the China Banking Association (CBA), announced it will launch a blockchain-based platform to improve efficiency across the sector. The project, formally dubbed the “China Trade Finance Inter-bank Trading Blockchain Platform,” aims to use blockchain to target trade finance, transactions and other financial services.

China has been actively adopting blockchain technology in various sectors. Recently, the country’s government issued the “Guiding Opinions on Rural Service Revitalization of Financial Services.” The new framework aims to use emerging technologies like blockchain to “improve the identification, monitoring, early warning, and disposal levels of agricultural credit risks.”

Blockstream Releases A New Multisignature Standard

Blockstream Releases A New Multisignature Standard

Blockstream a blockchain technology startup, announced the release of Musig, a test code for the proposed Schnorr-based multi-signature scheme on February 18. The MuSig scheme is a Bitcoin upgrade implementation that is focused on scalability and confidential transactions.

Musig

According to Andrew Poelstra, the company’s mathematician, this latest release is the turning point in the development of the Schnorr multi-signatures concept.

According to the announcement post:

“MuSig is a protocol that allows a group of signers to produce a short, joint signature on a common message.” The concept was introduced last year by Poelstra and other software engineers and since then they have worked hard to turn this concept into reality.

Poelstra added:

“We’ve been turning MuSig from an academic paper into a usable code, and this week we merged that code into secp256k1-zkp, a fork of secp256k1, the high-assurance cryptographic library used by Bitcoin Core.”

Old Issues Solved

While Bitcoin use-cases are growing, there is a need to streamline the signature scheme. This was the main reason leading to the development of the MuSig Signature algorithm.

Presently, bitcoin implements a digital signature algorithm is called ECDSA. However, this algorithm has some limitations since “multisignatures and threshold signatures – signatures made by a quorum of independent parties rather than a single person – are very difficult to produce with ECDSA.” making it unfeasible as a functional algorithm for multisignature usability. T

his works as an imposition, forcing developers to “use Bitcoin Script for applications such as cross-chain atomic swaps or Lightning”.

Poelstra stated:

“To address these concerns, we started an initiative to design a new signature scheme, and a significant practical engineering effort to implement it in a robust and ant fragile way.”

Implementing Musig on the Bitcoin upgrade

By having developed a more robust algorithm for multi-signing, Blockstream is looking to implement its new release into the Bitcoin firmware.

Poelstra wrote:

“As the bitcoin community is exploring the use of Schnorr signatures in bitcoin we hope that our code will eventually be merged into the upstream library secp256k1 used by bitcoin core and many other projects.”

While multi-party protocols present more complex and hard challenges than single-party protocols, Blockstream was able to design an algorithm that is capable of being much more simple and easy to use.

Future developments

For now, the team only mentioned the new multi-signing protocol but there was note of a future post that will set out to describe threshold signatures, a related concept that makes possible to produce signatures without contribution from the entire group.

The team is also developing new techniques for making nonce randomness safer to produce and more verifiable. Blockstream is aiming to leverage the power of zero-knowledge proofs to eliminate replay attacks and to remove the requirement for persistent memory reducing this way the MuSig protocol from three rounds to two.

Blockstream has made the new protocol test code available on GitHub and the team encourages everyone to test it and provide feedback!

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US SEC’s Bitcoin ETF Decision Could Influence Cryptocurrency Market in Korea, Report States

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US SEC’s Bitcoin ETF Decision Could Influence Cryptocurrency Market in Korea, Report States

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The US Securities and Exchange Commission (SEC) currently has two different bitcoin exchange-traded fund (ETF) proposals on the table, and its decision could influence the cryptocurrency market in South Korea.

According to the Korean Herald, South Korean institutions have been “keeping a tight leash on the whole cryptocurrency industry,” while observing the US’ moves on them. Speaking to the news outlet an official with the country’s main exchange, Korea Exchange, stated:

There are strong voices supporting the launch of bitcoin ETFs within the market — which is why we are observing the progress and response of the US Securities and Exchange Commission’s decision on bitcoin ETFs.

The official, who chose to remain anonymous, added that providing a “solid index required for the launch of such ETFs and of its role when it is commercialized and integrated into the market is being discussed expansively at the KRX because it would eventually concern investor protection issues.”

The clock started ticking for the SEC to review a bitcoin ETF application filed by Bitwise Asset Management with NYSE Arca earlier this month, meaning an initial decision is expected by April 5. Some industry observers believe a bitcoin ETF will bring in additional liquidity to the cryptocurrency ecosystem, and attract institutional investors.

Per the Korea Herald, however, local investment banks and asset management firms have been focusing on blockchain ETFs. Speaking to the news outlet a spokesperson for Mirae Asset Global Investments noted the firm manages an overseas blockchain ETF, but is “yet to engage in any bitcoin transactions.”

Lee Kyung-ho, a professor at Korea University’s Graduate school of Information Security, added:

With the government expanding its investment in research and development of blockchain technology, the projects are expected to minimize or eliminate the risk of integrating ETF transactions in the cryptocurrency market.

He added that cryptocurrency exchanges implement know-your-customer (KYC) and anti-money laundering (AML) checks may also help a bitcoin ETF be launched, as it’ll “boost transparency in transactions.”

South Korea is a country that has banned initial coin offerings (ICOs), but allowed crypto exchanges to remain open. The government has extended tax breaks for the blockchain industry this year to spur innovation.