Nick Szabo: Ethereum (ETH) is Becoming a “Centralized Cult”

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Nick Szabo: Ethereum (ETH) is Becoming a “Centralized Cult”

The Ethereum (ETH) leadership is showing signs of becoming a force to be reckoned with, commented bitcoin pioneer Nick Szabo. While Ethereum was inherently democratic, the need to perform a series of hard forks and upgrades has put the developer team in charge.

Ethereum Developers Steer Transfer to ETH 2.0

Now, Ethereum has unrolled once again the drive to move on to ETH 2.0, the proof-of-stake version of the network. But while early hard forks happened with the support of miners, now there is the disparity between the interest of miners, node operators, and developers.

The conflict became apparent in a simulated environment, as the Ropsten testnet split into two, with an entity still mining the old blocks. The question was raised whether miners could dispute the decision of the developers, and “vote with their feet”, by continuing to produce blocks.

Now, Ethereum developers have put up insurance against such an event, namely the “mining ice age”, which would make mining impossible at the protocol level. However, miners may still have significant influence. The developer team, on its side, has the power to sway multiple decisions. This has led to the accusations of Szabo, who sees the network becoming cultish.

Proposed Upgrade Goes Against Miners

The Ethereum protocol is trying to reinvent itself while the network is still alive and running. Smaller projects have managed to relaunch on new blockchains, but in the case of ETH, there is too much at “stake”.

Ethereum coins are increasingly important in the crypto ecosystem. The most recent trend, Defi, or crypto-collateralized lending, concentrates significant ETH funds in smart contracts, with expectations of returns. Any tremors on the Ethereum network would have wider repercussions for the crypto ecosystem.

Currently, Vitalik Buterin has expressed beliefs that users would not feel the switch between ETH1 and ETH2. However, the series of upgrades and decisions raise the specter of centralization, every time the developers decide on steering the network.

By all expectations, Ethereum was expected to enter the proof-of-stake stage much earlier. But so far, the phasing out of mining has been slower, limited to rolling back the crypto ice age, while decreasing the block reward.

ETH currently trades at $184.62 as the most liquid altcoin, with registered volumes above $7.24 billion in 24 hours.

What do you think about the platform governance model of Ethereum? Share your thoughts in the comments below!

Images via Shutterstock, Twitter: @NickSzabo4, @VitalikButerin

Is Lightning Network Suitable For Bitcoin Deposits, Withdrawals?

A Twitter poll by bitcoin evangelist Pierre Rochard discussed whether the Lightning Network is a suitable tool for BTC transactions on crypto exchanges. 

Poll Signals to Lightning Network Curiosity

Proponents of LN believe it would be a good fit for crypto exchanges.

Lately, exchanges have become extremely skeptical of inbound transactions, especially after a series of partial spending or 51% attacks affecting coins based on their core technology. It is not unusual for bitcoin exchanges to require as much as 100 node confirmations for networks that have fallen prey to double-spending. The most notorious cases include Bitcoin Gold (BTG), as well as Ethereum Classic (ETC).

On-chain bitcoin transactions are hardly threatened by attacks, and exchanges only require a few confirmations when processing a deposit/withdrawal. But the Lightning Network is still experimental and may lead to unexpected consequences.

LN still has a relatively small capacity in comparison to exchanges, which trade millions of bitcoins each day. The entire lightning network capacity is still pegged at 818 BTC.

Microtransactions to Boost BTC Adoption

LN is viewed as an opportunity to allow Satoshi transactions with zero fees and no time lag, to drive popularization for BTC micropayments. Exchanges function on a higher tier, often having a relatively high minimum threshold, or adding extra fees for the smallest on-chain transactions.

Adding the Lightning Network would then allow small-scale clients to move funds with ease. But so far, not one of the leading exchanges has seriously looked at implementing the technology.

Comments also included the possibility for veiled sending, as LN nodes are still pseudonymous and do not track their users. Currently, large-scale coin movements trigger whale-watching bots, which signal big fund movements. However, it is also uncertain if large-scale whales would be ready to entrust their funds to a network of voluntary peers. Loss of coins is still possible and may have happened before a recent bug was discovered and disabled.

The bitcoin network works out on-chain transactions close to $1 billion every day. The LN only managed to process $6,536, or around 0.784 BTC in the past 24 hours, as the real-life usage remains small.

What do you think about the potential of Bitcoin’s Lightning Network? Share your thoughts in the comments section below!

Images via Bitcoinist Media Library, Twitter: @pierre_rochard, @LNstats

Bitcoin’s Smallest Unit ‘Satoshi’ Gets Added To Oxford Dictionary

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Bitcoin’s Smallest Unit ‘Satoshi’ Gets Added To Oxford Dictionary

It’s official – Satoshi, the smallest divisible unit of bitcoin, is now an English word. While it has been used for years among the crypto community, the Oxford English Dictionary (OED) added the term earlier this month.

Now It’s Satoshi’s Turn to Refresh English Language

The crypto community requires new words to explain different aspects of new technology, new operations, and a new market. Think about blockchain, Bitcoin, Dapp, security token, initial coin offering (ICO), hodl, and so on.

Now it’s time for satoshi to reach the OED. The principal historical dictionary of English, regularly updated by the Oxford University Press, has just added the term. The OED explains that satoshi is:

The smallest monetary unit in the Bitcoin digital payment system, equal to one hundred millionth of a bitcoin.

The dictionary explains that the word derives from a proper name – Satoshi Nakamoto. Under this pseudonym, a cryptography expert or a group of them launched Bitcoin more than a decade ago. Whoever it was, the man managed to push his pseudonym into the English dictionary, and this is not an easy task.

Google required eight years to reach the OED in June 2006. The “google” term is used as a verb. However, unlike Bitcoin, which has over 172 million economically relevant addresses, Google had billions of users at the time.

Bitcoin Revolution Resembles the Internet’s First Years

When the Internet came out in the 90s, the English language was flooded with neologisms. Think about terms like hashtag, hyperlink, troll, selfie, spam, and so on. In fact, this short clip from “Today Show” in 1994 demonstrates how little people knew about the Internet:

Now people encounter the same difficulties in understanding what blockchain and Bitcoin are, even though the media uses these terms 24/7. As the adoption increases, Bitcoin with all its complexity will become familiar to everyone.

Do you expect some other crypto-related words besides Satoshi in the OED? Share your thoughts in the comments section! 

Images via Shutterstock, YouTube: Chrissy Miklacic

Bitcoin Miners Prepare For 18 Millionth Coin As Just 14% Of Supply Remains

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Bitcoin Miners Prepare For 18 Millionth Coin As Just 14% Of Supply Remains

Bitcoin miners will mine the 18 millionth BTC this week, leaving just 3 million left to release before mining stops in the distant year 2140.

3 Million BTC, 120 Years

Data from monitoring resource Blockchain confirmed that the total Bitcoin 00 supply had reached 17.92 million as of October 14.

According to block calculations, the remaining coins to 18 million should enter circulation before the beginning of next week.

“It will take another approximately 120 years to mine the remaining 14.3% of the total supply or ~3,000,000 bitcoin,” analyst Rhythm noted on social media on Monday. 

Miners competing for their bitcoin reward has also never been higher, with the hash rate at an all-time high.

Bitcoin miners create new BTC each time they successfully validate a block of transactions. These occur roughly every ten minutes. Every four years, their reward halves in size, meaning that ‘minting’ new bitcoins involves more and more work overtime.

Therefore, although 85% of the total supply of 21 million BTC has entered the market since 2009, the remainder will take much longer.

As Bitcoinist reported, even after the mining phase on Bitcoin ends, it is unlikely more than around 75% of the supply will be available. Users have already lost access to a chunk of the 17.92 million coins. Depending on the methodology, researchers believe these lost coins make up around 20% of the supply.

As such, it is likely that only around 15 million people will ever be able to own an entire BTC.

Hodlers Accumulate Big Balances

While the 18 million mark does not represent a technical achievement for the network, industry entities were excited, storage startup Luno describing it as an “exciting week.”

At the same time, the composition of Bitcoin holders is changing. Data this week showed stockpiling balances worth more than 1000 BTC had become far more popular in 2019. Previously, investors appeared less interested, with this year’s trajectory ending a five-year flat period.

Prior to the Mt. Gox implosion in early 2014, wallet holders were increasing their balances above 1000 BTC at a similar rate. 

At the time, commentators suggested, their impetus was technical curiosity. Given BTC/USD’s current price, it is conversely financial incentives that are fuelling 2019 activity. 

What do you think about mining the 18 millionth bitcoin? Let us know in the comments below!

Images via Bitcoinist Media Library, Blockchain

Facebook Seeking Central Bank Boss to Manage Libra?

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Facebook Seeking Central Bank Boss to Manage Libra?

Facebook appears to be unfazed by the unrelenting criticism and pressure that is piling on to its crypto domination aspirations. As the US Treasury Secretary waded in with more threats, another Libra Association partner bailed out, and the consortium concluded its first official meeting.

Any New Takers For Libra?

The Libra Association had its first general meeting yesterday in Geneva. The assembly involved establishing the basic governance of the Libra Association which now numbers just 21.

According to reports, five new board members were named including project lead David Marcus, Andreessen Horowitz’s blockchain boss Katie Haun, Xapo CEO Wences Casares, Matthew Davie from Kiva Microfunds, and PayU’s Patrick Ellis.

The Dutch firm PayU is the only payment processor left in the consortium as all of the US giants have fled under threat of heavy regulatory action. So far the number of defectors total seven; PayPal, Visa, Mastercard, Stripe, eBay, Kayak owner Booking Holdings, and South American payments provider Mercado Pago.

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The association asserts that Libra will be a separate entity but it is clear that Facebook and its billionaire ruler will still be the puppet master. It is this premise that has waved the red flag to the regulatory bull as the onslaught continues.

Just yesterday, US Treasury Secretary Steve Mnuchin told CNBC if those associated with the cryptocurrency did not meet its stringent anti-money laundering standards they would be subject to enforcement action. He added that those that had eagerly partnered the project have realized that they’re not up to par.

Central Bank Boss to Control Centralized Cryptocurrency

Facebook needs someone with the experience of running a central bank to manage its centralized cryptocurrency if it ever gets off the launch pad. According to reports, project lead David Marcus has already said as much. The irony was not lost on Messari Crypto founder Ryan Selkis.

According to the official press release, new partners are practically breaking down the digital door to replace the heavyweights that have just jumped out of the burning building.

The Libra Association confirmed that over 1,500 entities have indicated interest in joining the Libra project effort, and approximately 180 entities have met the preliminary membership criteria

Meeting Facebook’s criteria clearly aren’t the same as meeting regulatory criteria being set out around the globe. These guidelines have clear intentions of preventing a social media monopoly controlling the financial transactions of as many as two billion people.

These new partners, if they ever materialize, are likely to be non-US based minnows as all of the big fish are now swimming down the river away from these turbulent waters.

Will Facebook ever launch Libra? Add your comments below.

Images via Bitcoinist Media Library, Libra, Twitter: @twobitidiot

Binance CEO Eyes BNB Prospects After ETP Launch on SIX

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Binance CEO Eyes BNB Prospects After ETP Launch on SIX

Switzerland’s main stock exchange SIX has chosen to increase its cryptocurrency portfolio by trading a product based solely on Binance Coin.

Binance Coin ETP Goes Live On SIX

In a blog post issued on October 15, Binance Coin’s issuer, cryptocurrency exchange Binance confirmed it was launching a dedicated exchange-traded product (ETP) on SIX.

Trading will begin today and marks the first physically-backed BNB-based ETP anywhere in the world. 

The move follows multiple other ETPs on SIX. For the launch, Binance partnered with local startup Amun, which also helped bring the BNB ETP’s predecessors to market.

“Our partnership with Amun in launching the BNB ETP will provide investors with a new and regulated asset class with a unique dimension to utility tokens, making them more accessible and reliable through a traditional financial infrastructure,” Binance CEO Changpeng Zhao (known as ‘CZ’) commented in the press release. 

This will provide traditional investors access with diversified exposure and segue into the global cryptocurrency market and its innovative products.

BNB/USD appeared buoyed by the news, increasing by almost 5% over the past 24 hours. On Twitter, CZ hinted he suspected prices to increase further.

“I don’t know what it will do to the $BNB price, but it certainly makes $BNB more accessible to a new audience,” he wrote on Tuesday.

BNB has in fact come under pressure in recent months. Having hit all-time highs around $40 in June, the token then halved in value. Late last month, it reached local lows of just $15.

SIX Cosies Up To Crypto

As Bitcoinist reported, SIX has meanwhile sought to open up itself platform as a supportive environment for crypto-related products.

The exchange launched a multi-crypto ETP late in 2018, at the height of the Bitcoin bear market, remaining upbeat on its prospects. 

Earlier this month, Amun entered into a joint venture with Swiss operator Bitcoin Suisse to debut a Bitcoin and Ethereum ETP on SIX.

“This product further exemplifies Switzerland’s leading position in the crypto space, where Amun is able to work closely with the exchange and authorities to create regulated, compelling, and institutional-grade financial products,” Amun CEO Hany Rashwan said at the time.

SIX further plans to launch a Blockchain version of its platform, nonetheless postponing the release until 2020.

What do you think about the Binance Coin ETP? Let us know in the comments below!

Images via Bitcoinist Media Library

Altcoins Turn Bullish as Bitcoin (BTC) Struggles With Resistance

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Altcoins Turn Bullish as Bitcoin (BTC) Struggles With Resistance

Bitcoin (BTC) has spent another day consolidating with further failures to top resistance. Its lethargy and another dominance dip are good news for altcoins which are having a bit of a revival today. Ripple’s XRP, which has been on the floor for most of 2019, is going up strong as is Stellar Lumens, 0x and BAT.

Bitcoin Price Battles at Resistance

As bitcoin price continues to consolidate the altcoins are finally waking up following a year of slumber. Most have retreated from their summer highs but some are starting to rally again in a rare move independent of their leader.

BTC has dropped another percentage point in dominance and is now below 68.5% according to That share is being gobbled up by high cap altcoins and XRP is one of them today.

The token has continued its rally and is one of the day’s top-performing altcoins. Since the end of last week, XRP has added $1.5 billion to its market cap and climbed 11% in price.

So far this month XRP has climbed over 20% and is approaching its psychological barrier of $0.30. Today it has seen further gains topping out at $0.298 a couple of hours ago during early Asian trading. Daily volume has surged 60% since the weekend and just topped $1.6 billion as the momentum builds.

The bigger picture still shows the cross border transfer token flat on the floor, down 90% from ATH. Regardless, the crypto community has turned bullish on Ripple’s token and sees this as a good entry-level for further gains. Trader ‘CryptoWelson’ didn’t miss the opportunity to point out his earlier prediction.

I tweeted a few weeks ago that I saw bullish momentum in $XRP and was expecting a rise! We’re now up over 20% from that, and XRP has just broken out of resistance. Get ready folks. Massive pump incoming!

Once the $0.30 level is broken further gains up to $0.40 could come quickly as there is very little resistance in between.

The annual Swell event is approaching which is usually bullish for XRP. This year it will be held from November 7 to 8 in Singapore. Traders and analysts have noted the price fluctuations before and after this event and the pump may have already started.

The San Francisco fintech firm has made a couple of partnerships but Swell is likely to be the primary driver of momentum at the moment. XRP is approaching crucial resistance and this week will determine whether it has the minerals to make further gains regardless of what bitcoin does.

When Altseason?

Ethereum has made a minor move back to $185 today but remains sluggish at any price below $200. BCH, LTC, EOS, and BNB have not moved but Stellar (XLM) has woken up with a jump of almost 10% on the day. DEX protocol token ZRX is having a double-digit shift at the moment and browser-based BAT is also going strong.

Will Bitcoin dominance fall further? Add your thoughts below.

Images via Bitcoinist Media Library, Twitter: @CryptoWelson

Grayscale Wins First US Approval For Cryptocurrency-Based Security

Grayscale Get Approval Securities News

Grayscale Wins First US Approval For Cryptocurrency-Based Security

A pivotal US self-regulatory organization has formally licensed the country’s first public security based on cryptocurrency markets.

Large Cap Fund Gets FINRA Say-So

Shares of Grayscale’s Digital Large Cap Fund (DLC) received the green light from the Financial Industry Regulatory Authority (FINRA) this week, a press release confirmed on October 14.

Grayscale, currently the world’s largest cryptocurrency asset manager, has operated the DLC since the beginning of 2018. 

The investment vehicle allows institutional clients to gain access to the price of several cryptocurrency assets without taking on the risk and compliance obligations of trading them direct. 

The approval sets off a one-year cooling off period during which, under US securities law, the DLC shares will not be publicly tradable.

“There will be no trading volume in the Shares’ public quotation until the Shares are DTC eligible, which GDLC is expected to receive soon,” the press release added. 

Investors will be able to buy and sell freely-tradable DLC shares through their investment accounts in the same manner as they would other unregistered securities.

The DLC currently consists of 80% Bitcoin 00, followed by 9.9% Ethereum 00. The other minority components are Bitcoin Cash, Litecoin and XRP.

Grayscale Stays Upbeat On Precarious Crypto Market

The announcement continues a return to form for Grayscale’s fortunes in the latter half of 2019. Previously, the company revealed institutional interest had remained constant throughout Q2 this year. 

Following on from its buoyant Digital Asset Investment Report released in July, executives revealed institutions were still curious about crypto despite the end of the bullish market phase which began in April. 

“…There’s this rhetoric in the media about when are institutional investors going to get involved, when are they going to start investing, and it’s so funny because it’s ironic,” director of sales and business development Rayhaneh Sharif-Askary told news outlet The Block last week. 

“We see institutional investors invest with us all the time and that’s been the case for a long time now.”

As Bitcoinist reported, sentiment had largely tended to the contrary in recent weeks as Bitcoin floundered. According to industry research, coverage of institutional interest in the sector reached its lowest point in September.

A positive decision about another pioneering investment tool – the first Bitcoin exchange-traded fund (ETF) – could have boosted sentiment. This did not happen, however, with US regulators denying its entry to market. 

What do you think about FINRA’s decision? Let us know in the comments below!

Images via Shutterstock

Bitcoin (BTC) Whale Just Moved $900M in Single Transaction

Bitcoin Whale Moves 0.9 Billion USD Bitcoin

Bitcoin (BTC) Whale Just Moved $900M in Single Transaction

The Bitcoin network once again carried a stunning amount of value in a single transaction. Recent tracking showed the movement of more than 107,848 BTC, worth nearly $900 million at the time of tracking.

The Whale Turns Out to Be Bitstamp

The transaction follows a previous unknown whale that moved more than $1 billion and a more recent transfer of 13,850 BTC. Such transactions are usually found to belong to exchanges. This time, the transaction later turned out to be linked to Bitstamp, the European exchange that sports one of the important spot markets and supplies data to other exchanges. The funds were moved to a XAPO-2 wallet, a cold storage service.

Initially, the large-scale transaction created worries, as unknown movements of funds are sometimes linked to hacks or exploits. Initially, the destination address remained unknown, and was identified later.

This time, the transaction was not caught by whale-watching bots, and instead was registered by ByteTree, a service tracking the weight and value of transactions. The visuals show the transaction outpaced all other similar coin movements. It was also mystifying why the Bitstamp exchange failed to warn about the large-scale movement of funds. The exchange, initially founded in Slovenia and based in Luxembourg, is one of the fully transparent EU-based markets with high liquidity.

Bitcoin Network Had a Slow Day

The transaction happened on a day when the Bitcoin network carried a total of around $374 million, a relatively sluggish day. The network also carried around 274,000 transactions, not counting unspent outputs, a relatively slow day compared to previous periods of more rapid movement.

But there is also a sign of accelerating activity, as the US markets open. On Monday, at one point more than 16,000 transactions waited their turn to be included in a block, remaining in a pending state. Usually, an increasing backlog shows high demand to move coins. Coin movements are also linked to upcoming price action.

BTC traded at $8,371.87 on Monday, unable to break above the $8,400 tier. The leading coin is still seeking direction, with expectations of a further slide before a more significant rebounce.

Wallets of a size above 100,000 BTC usually belong to exchanges. The Binance cold wallet contains 162,644 BTC, with an extra cold wallet containing 65,044 BTC. This makes Binance one of the largest BTC whales, especially after its futures market picked up and reached record activity.

What do you think about the recent whale transaction? Share your thoughts in the comments section below!

Images via Shutterstock, Twitter @Bytetree @Chaindotinfo

Bayern Munich Partners with Stryking for Blockchain-Based Collectibles

FC Bayern Munich Offers Blockchain-Based Collectibles News

Bayern Munich Partners with Stryking for Blockchain-Based Collectibles

Bayern Munich, Germany’s most successful football club, has partnered with the blockchain-oriented venture of fan engagement firm, Stryking Entertainment.

Blockchain-Based Collectibles on Bayern Players

According to the agreement, Stryking, which is itself a subsidiary of Hong Kong-based Animoca Brands – a mobile games developer, will issue and distribute digital collectibles based on Bayern players. Thus, the German football club will become part of a global platform for blockchain collectibles.

Stryking has created a fantasy sports challenge aimed at its “Football-Stars” game. The latter provides gameplay for the blockchain-based collectibles. It allows fans to use the virtual cards to compete against each other in special challenges.

For example, users will be able to create virtual teams with their player cards and compete against the teams of other users. Consequently, the results will influence the value of the non-fungible collectibles, which the users can then sell at a better price.

Stryking will start with cards related to Bayern stars like goalkeeper Manuel Neuer, forward Robert Lewandowski, and former Barcelona player Philippe Coutinho.

Dirk Weyel, founder and CEO of Stryking Entertainment, commented:

FC Bayern is one of the biggest football clubs in the world and their fans all around the globe should watch out for the first pre-sale with rare cards of their favourite stars coming soon.

In the upcoming weeks and months we will add more football licenses and other sports to the platform. Our vision is to build a truly global hub where sports fans meet to collect and trade, as well as play with their digital collectibles

Bayern is not the only football club connected with blockchain. There are more European teams that are embracing digital tokens. Giant clubs like Juventus, Paris Saint-Germain (PSG), AS Roma, and Benfica are all using cryptocurrency in one way or another already.

Most of the clubs that adopt blockchain-based tokens are using them to better engage with the fans., a startup offering customized Fan Tokens aimed specifically at football clubs, partnered last year with Juventus and PSG, which host two of the most popular players in the world, Cristiano Ronaldo and Neymar Jr., respectively.

Individual players are also becoming aware of the new technology. For instance, former Bayern player James Rodriguez launched his own cryptocurrency called JR10 Token.

What is your favorite football club? Would you buy customized tokens offered by it? Share your thoughts in the comments section!

Images via Shutterstock