Reddit Co-founder: Bear Market is Good for Crypto Innovation

Alexis Ohanian has spoken about the current state of the cryptocurrency markets.

The Reddit co-founder believes that the dwindling prices experienced throughout 2018 are good for the space and will allow those committed to it to work with fewer distractions.

Ohanian Silent on Previous Ether Price Call

One of cryptocurrency’s most committed bulls, Alexis Ohanian, has stated that the current bear market is actually good for the digital asset and blockchain industry.

Ohanian founded the wildly successful social news forum Reddit from his university dorm room in 2005. A few years later the site became a useful resource for Bitcoiners and this gave the entrepreneur a rare early opportunity to observe, engage with, and learn about the community and tech.

This led to Ohanian developing a keen interest in cryptocurrency and blockchain technology.

In 2013, he decided to take a more hands-off approach to Reddit and pursue a venture capital fund known as Initialized Capital. The early stage investment group has previously invested in Coinbase and other crypto-related startups.

In a recent interview with Breaker Mag, Ohanian was joined with his Initialized Capital partner Garry Tan to discuss the state of cryptocurrency as well as what the pair looked for in terms of blockchain startups to invest in.

The Initialized Capital co-founders first addressed their approach to picking prospects from the digital currency space. Tan told the publication that there was little difference between how they evaluate blockchain firms and non-crypto ones. He said if the company in question was able to outperform the competition then it mattered little if they were centralised or decentralised. Ohanian supported this point, but added that Initialized Investments believes blockchain can provide “better, cheaper, faster” services.

The interviewer then addressed current market conditions. In response to a question about whether Ohanian and Tan believed the current bear market to be permanent or simply a passing phase, the pair agreed that prices would eventually resume an upwards trajectory. Commenting on what could break the downtrend, Tan stated:

“How it comes out of the current crypto winter, we still think it will come back to real use cases.”

Rather than dwelling on the dropping prices, the partners instead focused on the positives of such a bear market. For them, the bursting of the late 2017 bubble allows those developing projects to concentrate on more important matters than price. Tan said:

“The last time this happened, Bitcoin went from north of $1,000 down to $250, and that winter lasted years. People started losing hope, and out of that came etherium [sic]. Truly useful things come out of the nadir of the last hype cycle.”

Ohanian added that the price action had pushed many speculators away from the market. For him, such a move causes the space to realign and “really incentivises the people who are building to just build.”

Interestingly, during the interview there was no mention of Ohanian’s early 2018 price call for ether tokens. The Reddit co-founder famously stated in May that he believed the number two digital asset on earth would reach a staggering $15,000 this year.

With the price floating around the $213 mark at the time of writing, a prediction that looked far-fetched then now looks all but impossible.

Related Reading: Reddit Co-Founder Bullish on Bitcoin Despite Current Price Slump

Featured image from Shutterstock.

Korean Lawyers Lobby Government to Pass Several Cryptocurrency Laws

The Korean Bar Association, whose membership is mandatory for all lawyers in the country, has campaigned publicly for the government to pass a number of cryptocurrency-related laws. The group specifically proposes regulation for crypto exchanges, initial coin offerings, domestic and foreign crypto transactions, and cryptocurrency funds.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Lawyers Press Government for Crypto Laws

Korean Lawyers Lobby Government to Pass Several Cryptocurrency LawsThe Korean Bar Association on Thursday lobbied the government “to quickly establish a legal framework to help develop the blockchain-based virtual currency industry and protect investors,” Reuters reported.

“It is rare for the Korean Bar Association, membership of which is mandatory for all local lawyers, to campaign publicly for specific technological or business interest groups,” the news outlet noted.

At a press conference held at the National Assembly on Thursday, the president of the association, Kim Hyun, was quoted as saying:

We urge the government to break away from negative perceptions and hesitation, and draw up bills to help develop the blockchain industry and prevent side effects involving cryptocurrencies.

Korean Lawyers Lobby Government to Pass Several Cryptocurrency Laws
Representatives of the Korean Bar Association at the press conference on Thursday.

Crypto-Related Proposals

The Korean government is currently working on the legal framework for initial coin offerings (ICOs) which it banned in September last year “without disclosing legal grounds,” News1 wrote, elaborating:

The Korean Bar Association specifically proposed the direction of regulating cryptocurrency trading sites, ICOs, domestic and foreign cryptocurrency transactions, and cryptocurrency fund products.

The group urges the government to adopt clear legal legislation related to crypto exchanges to prevent activities such as wash trading, insider trading, and money laundering, Chosun explained.

Korean Lawyers Lobby Government to Pass Several Cryptocurrency LawsThe association also presses for regulations in accordance with the Foreign Exchange Transactions Act for domestic and foreign crypto transactions.

Furthermore, instead of prohibiting investments in cryptocurrencies, the group proposes permitting certain types of organizations with expertise and qualifications to trade them.

The association asserted:

Even in the United States, where regulations on securities are strict, the law permits fund operations using cryptocurrencies as an underlying asset and futures trading.

Security ICOs

Korean Lawyers Lobby Government to Pass Several Cryptocurrency LawsFor ICOs specifically, the association proposes applying the existing securities laws such as the Capital Markets Act or Financial Investment Business Act to security tokens, covering both domestic and foreign ICOs entering the Korean market, News1 detailed.

In addition, the group says the country’s Financial Services Commission (FSC) should “specify in advance the obligation to submit related documents such as a whitepaper” for ICOs of foreign companies entering the domestic market.

Meanwhile, FSC Vice Chairman Kim Yong-beom said on Wednesday that “The financial authorities will release the results of the actual initial coin offering situation this month.” The government is evaluating the outcome of its ICO survey conducted in September.

What do you think of the Korean Bar Association urging the government to pass these cryptocurrency-related laws? Let us know in the comments section below.

Images courtesy of Shutterstock, the Korean Bar Association, and Chosun.

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4 Reasons Why VanEck Is Hopeful That Its Bitcoin ETF Proposal Will Be Approved by the SEC


4 Reasons Why VanEck Is Hopeful That Its Bitcoin ETF Proposal Will Be Approved by the SEC


On Thursday (8 November 2018), Ran Neu-Ner, the host of CNBC’s Crypto Trader show, released the video of an interview with Gabor Gurbacs, the Director of Digital Assets Strategy at ETF and mututal fund manager VanEck. This article focuses on the main highlights from this interview.

Q: The whole crypto community has got their eyes set on you guys getting the first Bitcoin ETF. So, how close are you?

A: Well, America wants a Bitcoin ETF… So, we are close… The final deadline that they can approve this ETF or deny it is 2/27 2019 [27 February 2019]. The next decision upcoming is December 29th this year.

Q: So, what’s happening on December 29th and what is the February date?

A: [On] December 29th [2018], the SEC may say that we need more time to make a decision on this ETF, and legally, they can push it to the next deadline. The next deadline is the February one that I mentioned, at which point they need to make a final decision of yes or no. 

Q: What makes you think you’re going to be successful?

A: There are a few reasons, Ran. One of them is VanEck’s history of building the right market structures for asset classes. So, in 1955, John VanEck, the firm’s founder, built the first international stock mutual fund here in the U.S. In 1968, he built the first gold equity fund, and basically in the past 60 years, we’ve built market structure and funds for harder to access investment instruments. So, we’re doing the same with Bitcoin…

Our ETF, what sets it apart, is

  • It’s a physical Bitcoin ETF; so, it stays true to the underlying Bitcoin.
  • It’s fully insured. So, if there are any thefts, hacks, or losses, the insurance covers it.
  • The pricing we use for Bitcoin comes from our indexing subsidiary [MVIS], which is a regulated entity and provided the first financial standard in regulated indices.
  • The ETF is institutionally oriented. So, 25 bitcoins per basket.

Q: Do you speak to the SEC regularly?

A: VanEck has a 60+ years relationship with the regulators, and we speak regularly with the regulators… I do think that the SEC is open to discussing improvements and proposals with market participants… Right now, the Coinbases and the larger exchanges of the world operate in this semi gray area, and the regulators don’t do much about it because they don’t want to squash innovation, but at the same time, they want to make sure that the capital markets stay intact. And I think the ETF solved this question of not squashing any innovation and at the same time bring some level of regulation to the digital asset space. 

Featured Image Courtesy of VanEck

Bitcoin Mass Adoption Will Happen Naturally

Bitcoin mass adoption Op-Ed

Bitcoin Mass Adoption Will Happen Naturally

Bitcoin mass adoption, contrary to popular belief, will not occur by “educating” the public. Instead, this transition will happen naturally as young generations become increasingly familiar and confident in this technology.

Not Understanding Bitcoin is Their Job

Let’s face it. Bitcoin’s biggest naysayers are typically in their twilight years, unlike most Bitcoin users and investors. Paul Krugman, Warren Buffet, the head of the Bank for International Settlements, Agustin Carstens, for example, are all over 60 years old.

But don’t hand them a copy of The Bitcoin Standard just yet. You see, not only is their time running out, but their credibility actually depends on them not understanding Bitcoin.

It is, therefore, doubtful that these geriatric gentlemen will change their minds anytime soon after they called it everything from a Ponzi to “rat poison squared.”

Agustin Carstens BIS

Agustin Carstens

“Cryptocurrencies do not fulfill any of the three purposes of money. They are neither a good means of payment, nor a good unit of account, nor are they suitable as a store of value. They fail dramatically on each of these counts,” Carstens said in July, warning young people not to create their own money.

Yes, Bitcoin is a Threat

But every new disruptive technology has faced harsh criticism from incumbents whose predictions now seem so obviously wrong in retrospect. Some notable examples include William Orton, President of Western Union, who stated in 1876:

This ‘telephone’ has too many shortcomings to be seriously considered as a means of communication.

President of the Michigan Savings Bank who advised Henry Ford’s lawyer, Horace Rackham, not to invest in Ford, said in 1903:

The horse is here to stay but the automobile is only a novelty — a fad.

Even computer pioneer Bill Gates, Microsoft co-founder, said in 1981:

No one will need more than 637KB of memory for a personal computer. 640KB ought to be enough for anybody.

With each day, Bitcoin is becoming an increasing problem that just won’t go away for the old guard. Nor is it a static technology. It has been running 24/7 for over a decade now with 99.98% uptime. And the longer it exists, the more people will start to question the credibility of these money magnates.

Yes, Bitcoin undermines banks by empowering individuals to be their own bank. But Bitcoin takes it even further. It completely separates money and seignorage from the state and central banks. The implications of this idea are just as groundbreaking as the separation of church and state.

So despite cryptocurrencies still being only a drop in the global economy’s ocean, it speaks volumes that the old guard is scrambling to plug the cracks in the dam.

Generation Bitcoin

At ten years old, Bitcoin’s fundamentals are getting stronger with each passing day, while undermining any critic crying “Bitcoin is dead.” Meanwhile, the younger, tech-savvy generations are witnessing Bitcoin’s staying power.

In fact, the millennial generation, in particular, has a deep distrust for banks in the wake of the 2008 financial crisis. This group doesn’t invest in stocks like their Boomer counterparts and is already comfortable using digital money from their smartphones. Hence, it is no surprise that millennials (ages 18-34) comprise the biggest share of Bitcoin users today.

How Icon (ICX) and Others Skirt South Korean Restrictions

What’s more, in 8 years, there will be no person under 18 years old who have lived in a world without Bitcoin, which has been working flawlessly their whole lives. This will be the reality for everyone born in 2009 and beyond.

“Their trust in bitcoin will be as profound as their trust in gravity,” one Twitter user succinctly wrote.

So when will this holy grail mass adoption happen?

In some places like Venezuela, it’s already permeating public consciousness out of sheer necessity. Elsewhere, it is simply a matter of time. Simply put, Bitcoin mass adoption will first happen slowly, and then fast.

[Editor’s note: Credit to Twitter users @C_ruhf and @The1Brand7 for inspiring this piece]

How do you envision the mass adoption of cryptocurrencies? Share your thoughts below! 

Images courtesy of Shutterstock, Twitter

Crypto Exchange Suspends StatCounter Service after Reports of Hackers Hijacking Bitcoin Transactions

Cryptocurrency exchange has removed StatCounter, one of the most popular web analytics tools, from its website following reports of a security breach, the company announced in a blog post on November 7, 2018.

A Supply Chain Attack on Cryptocurrency Exchange

Cryptocurrency hackers have reportedly attacked one of the internet’s most used traffic analytics services, StatCounter, to steal bitcoin from users of cryptocurrency exchange

According to a blog post on, the company decided to stop using StatCounter for traffic stats after getting a notice about suspicious behavior in StatCounter’s traffic stats service.

Matthieu Faou, the ESET malware researcher who discovered the hack, said that this malicious code hijacks any Bitcoin transactions made through the web interface of the cryptocurrency exchange. “We contacted [StatCounter] but they haven’t replied yet,” Faou told ZDNet in an email.

“The JavaScript file at www.statcounter[.]com/counter/counter.js is still compromised.”

Faou said the malicious code was first added to this StatCounter script on November 3, and that none of the companies that currently load the company’s tracking script have anything to fear. The malicious code inserted into StatCounter’s site-tracking script only targets the users of cryptocurrency exchange

Statcounter Web Analytics Script Set to Steal Bitcoins

According to a PublicWWW search, there are over 688,000 websites that currently appear to load the company’s tracking script. However, ESET’s research pointed out that the malicious code in question looks at the page’s current URL and won’t activate unless the page link contains the “myaccount/withdraw/BTC” path.

The URL targeted by the malicious code was quickly identified as belonging to the exchange, which is currently ranked 39th in CoinMarketCap‘s rankings. Rankings

(Source: ESET)

The URL targeted by the malicious code is part of a user’s account dashboard and opens to a page on which users make Bitcoin withdrawals and transfers. Faou says the malicious code was built to replace any Bitcoin address users enter on the page with one controlled by the attacker.

“A different Bitcoin address is used for each victim. We were not able to find the attackers’ main Bitcoin address. Thus, we were not able to pivot on the blockchain transactions and find related attacks,” Faou told ZDNet, suggesting it’s still impossible to determine the amount of bitcoin the group might have stolen.

In the conclusion to his report, Faou said that the recent security breach again demonstrates the fact that external JavaScript code is under the control of a third party and can be modified at any time without notice. Both ESET and have urged their users to ensure their two-factor authentication is activated and that they have enabled a two-step login for their accounts.

Korean Lawyers Urge Government to Draw Up Blockchain Rules

The body governing South Korean lawyers has called on the government to hasten the introduction of blockchain regulations.

According to a report from Reuters on Thursday, the Korean Bar Association said the government should “quickly” develop blockchain laws in the country to help develop the tech industry and protect investors.

Kim Hyun, president of the Korean Bar Association, was quoted as saying:

“We urge the government to break away from negative perceptions and hesitation, and draw up bills to help develop the blockchain industry and prevent side effects involving cryptocurrencies.”

The government, however, will reportedly take a decision only after studying the technology thoroughly. It is currently examining the situation, alongside financial regulators in the country, according to the Reuters report.

In July, the Financial Services Commission (FSC), the country’s financial watchdog, set up a new department dedicated primarily to cryptocurrencies and blockchain. Dubbed the Financial Innovation Bureau, it was created to focus on developing policy-making initiatives for the industry.

Also in July, a senior executive at the FSC called on the government to pass a bill regulating domestic cryptocurrency exchanges with urgency in order to counter lax security in the industry.

At the same time, members of a number of Korean political parties were reportedly expected to submit a number of bills focused on regulating cryptocurrencies, initial coin offerings and blockchain. So far, though, there has been no action on the part of the government.

The lack of clear rules is also causing domestic crypto exchanges to increasingly set up in outside jurisdictions, according to The Korea Times in a report today.

The news comes after a group of judges, lawmakers and industry experts formed a new group this summer called the Blockchain Law Society, aimed to discuss legal issues surrounding blockchain technology.

South Korea flag image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Latest Version of MetaMask Introduces Privacy Mode to Protect Ethereum Wallet Accounts

MetaMask, the startup behind a world-renowned Ethereum client, has released new features aimed at improving the consumer experience, most notable of which is the new privacy mode designed to increase security for Ethereum Wallet accounts, the company announced in a Medium press release on November 5, 2018.

MetaMask Addresses Concerns about User Safety

MetaMask, the ConsenSys-backed company behind the eponymous browser extension, has just released a new version of its software, introducing an array of new features aimed at bettering the user experience and increasing security.

The extension, which makes it possible to interact with a whole world of websites built on the Ethereum blockchain, adds a small JavaScript “Ethereum provider” each time a user visits a site. And while the script is essential to making the extension work, it does pose a threat to the users’ privacy.

The company explained that the Ethereum provider object is visible to any site a user visits, which means their Ethereum addresses are indiscriminately exposed. That way, anyone with a users’ address could retrieve their account balance and entire transaction history, which could be used to fingerprint, Phish, or track unsuspecting users.

Privacy Mode MetaMask

(Source: Medium)

MetaMask Update Introduces Privacy Mode

Aiming to address the increased safety risk posed by their original Ethereum provider object, MetaMask has announced the launch of the Privacy Mode option. According to the company’s Medium post, MetaMask has led an effort to improve this privacy flaw across the entire Ethereum ecosystem, which is documented in the EIP 1102 standard.  

As of version 4.18, all MetaMask users will see the options to turn on Privacy Mode in their settings, which will be opt-in at first. However, the company explained that Privacy Mode would “eventually be the default experience for all MetaMask users.”

By enabling Privacy Mode, users will see a MetaMask popup asking them for permission to view their Ethereum accounts. The company’s release said that the new feature would remember which websites were allowed to access the users’ address. Features such as requiring certain requests each time a user visits will reportedly be available in a future update.

And while privacy mode was made incredibly simple for users, dApp developers will have to put in more work for their apps to stay compatible.

The launch of the privacy feature might not sound like a massive improvement, especially when it comes to a company as relevant as MetaMask, but many have seen this as a promising step towards increased privacy in the crypto industry overall.

Bitcoin Cash Declares War: Why This Could Mean Another Split

“Do not come crying when you are bankrupt.”

Lobbed at those bitcoin cash enthusiasts supporting Bitcoin ABC, the main implementation of the blockchain software, Craig Wright seems to have no intention to compromise as the cryptocurrency gears up for its next system-wide upgrade, or hard fork.

The controversial figure who claims (without much evidence) that he is bitcoin’s pseudonymous creator Satoshi Nakamoto has long been one of the leading figures of bitcoin cash, the fourth largest cryptocurrency by market cap, which famously broke off of bitcoin in the heat of the scaling debate last year.

But while he was initially embraced by the bitcoin cash community, he’s now in the middle of a battle over its future.

While bitcoin cash has undergone several hard forks over its one-year lifespan, the forthcoming one – set for November 15 – doesn’t have consensus from all the community.

The arguments started over which set of upgrades should be included in the code change. And less than a week from the activation date, the debate looks like it’s going to split bitcoin cash into two different cryptocurrencies – one running Bitcoin ABC and the other running software created by Wright’s company nChain called Bitcoin Satoshi’s Vision (or Bitcoin SV). Though there aren’t many data points so far, an experimental predictive trading market indicates that Bitcoin ABC has more user support.

And although Wright isn’t quite endorsing an attack fully, on Twitter he seemed to provide a rationale for miners to use their power to “kill off” the blockchain running Bitcoin ABC. According to Wright, by deploying hashpower, Bitcoin SV miners can effectively mine empty blocks on the competing bitcoin cash blockchain, stopping transactions from going through.

Wright argues that these kinds of things are “a part of the protocol” and thus fine to do (and to his point, there are not rules preventing this).

And sure enough, one new mining project called SharkPool tweeted that it will “exclusively” mine empty blocks, pointing to Wright’s tweetstorm as reasoning.

Still, Peter R. Rizun, the chief scientist for Bitcoin Unlimited, the second most popular software implementation of bitcoin cash, contends these threats are likely “a bluff” meant to scare Bitcoin ABC supporters.

Yet others, including Chris Pacia, a developer for ecommerce platform Open Bazaar and also on bitcoin cash, believe this to be the malicious attack of a man “hell-bent on getting his way.”

Pacia told CoinDesk:

“I don’t mind splitting Craig Wright off, but he’s threatened to destroy the other chain with a 51% [attack]. That’s really uncool.”

Déjà vu?

If you’ve been in bitcoinland for long, this could all sound pretty familiar.

It was a little more than a year ago that bitcoin was seeped in debate about how to scale the network, and the community was battling over a seemingly very small feature of the online money: the size of its block size parameter.

Not everyone agreed on the way forward, so the debate into threats of a split. Bitcoin miners, much like Wright, even threatened to attack the other chain after the split.

Thus was forged bitcoin cash, a cryptocurrency which scrapped the upgrade Segregated Witness (SegWit) for a much larger block size parameter.

And while the bitcoin cash community largely agreed on the crypto’s way forward for this first year, this harmonious face began to crack as the community grew. Soon enough, the community found itself immersed in its own block size debate.

The Bitcoin ABC software upgrade features a couple of key technical changes, including a so-called opcode to make it easier to execute “atomic swaps,” a technology for trustlessly trading one cryptocurrency for another. But it does not increase the block size any further – currently bitcoin cash has 32 MB block sizes.

But Wright’s Bitcoin SV wants to see an increase in the block size parameter from 32 MB to 128 MB.

It’s technical – and some would claim unnecessary at this point – but over the past several months, bitcoin cash supporters have begun choosing sides.

The largest bitcoin cash mining pool, CoinGeek, for instance, publicly announced that they were in support of Bitcoin SV (and bigger blocks) in August. On the flip side, information site and mining pool (run by perhaps bitcoin cash’s most vocal supporters, including Roger Ver) recently announced support for Bitcoin ABC.

As a result of the ongoing controversy, many bitcoin cash-supporting businesses and exchanges – including Binance, Coinbase and Polintriza, as well as, instant payments application Money Button – have largely frozen operations for the time being.

Speaking to the nature of the upcoming hard fork or forks, CEO of Money Button Ryan X. Charles said that eventually “users running implementations of the bitcoin cash software will have no choice but to upgrade to either one of the two competing.”

Political growing pains

So while the debate seems pretty technical, according to Bitcoin Unlimited’s Rizun, the arguments boil down to a fight over power.

“I don’t want to participate in something to give more influence to nChain and Craig Wright,” Rizun said, adding:

“It’s not a technical debate, it’s about control.”

Meanwhile, Bitcoin SV supporters argue similarly about the other side.

“Bitmain and working hard to ruin bitcoin,” Calvin Ayre, the CEO of CoinGeek, tweeted.

He sees the changes BitcoinABC is hoping to make are dangerous, going as far as to argue in a blog post that one feature being put forth, DSV, which would give the cryptocurrency Augur-like mechanisms, could “enable the network to be halted.”

Either way, though, Rizun argues that this level of heated debate shows that bitcoin cash will no longer be able to make the type of upgrades at the speed they used to.

“I think what’s happening is bitcoin cash has outgrown the need to have these regular hard forks,” Rizun told CoinDesk. “Because we set this plan in motion, we have this issue now for the first time where regulated hard forks are causing controversy.”

Yet, this controversy is affecting the businesses that moved over to bitcoin cash during its split from bitcoin in an effort to pioneer the cheaper, faster payment network they believed was the original intent of Satoshi Nakamoto.

Caught in the crossfire of the debate, Money Button’s Charles is just waiting for the controversy to cool – hopefully with only one coin emerging.

“The theory of money button is one money, not many. The product is worse in every way if we have to worry about managing different coins at the same time,” Charles said, concluding:

“I will happily embrace either side so long as there’s a clear winner.”

Craig Wright image via BBC

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.