Anthony Mburu and his fiancée Elizabeth John at Nation Centre on November 22, 2017 for an interview. Mburu paid part of his dowry using Bitcoin

Rise of Bitcoins causes stir but questions linger

Anthony Mburu and his fiancée Elizabeth John who recently attracted curiosity when he paid part of his dowry using Bitcoins, a form of digital currency, in Naivasha Kenya,considers himself a non-conformist.

Having quit university in 2010 after just one semester of his engineering course, 26-year-old Anthony Mburu does not fancy formal education, for instance.

“Formal education is good. It will give you an average life. You’ll eat, have your mortgage, car loan and all that — live an average life; struggle through life to the end,” he opined.

WALUBENGO: Kenya's uneasy dance with Bitcoin

DOWRY

He currently makes a living out of “mining” Bitcoins and he says that is the source of income that has enabled him buy a parcel of land in Naivasha, stay in a rented house and has given him something to buy and maintain his car among other fortunes.

“Everything is Bitcoin. Where I live, Bitcoin; what I drive, Bitcoin; investment, Bitcoin,” he said.

The computer-generated currency, he says, enabled him pay part of his dowry.

On November 11, as he headed to the home of his fiancée Elizabeth Chege in Naivasha, he had already negotiated with his in-laws that the goats portion of his dowry be settled with Bitcoins.

MOBILE APPLICATION

There are some components of the dowry process he paid for in hard cash.

His father-in-law, John Thion’go Chege, a retired KenGen employee, bought the idea.

They helped him download a mobile phone application that works as a Bitcoin wallet.

“We told him, ‘You just receive this and keep it. In a few months, you will have double the dowry. And if you keep [real] goats, they’ll still be the same goats,’” Mr Mburu said.

Ms Chege, the 6th born in a family of nine children, said her parents did not ask many questions despite the fact that Bitcoin is not a well-known concept in Kenya.

“They can’t refuse because they believe in me,” she said.

CBK

Mr Mburu’s unprecedented action has drawn mixed reactions since Bitcoin is a currency the Central Bank of Kenya has told the public to eschew because it is not backed by any regulator.

In a recent interview, Central Bank of Kenya Governor Patrick Njoroge reiterated his disdain for Bitcoin, saying the way the currency’s value has shot up is proof that it could be a Ponzi scheme.

“Our point is that there is risk and it is important that everybody knows that those risks can come back to haunt us and have financial stability concerns,” Dr Njoroge said.

VALUE

Those who are in Dr Njoroge’s school of thought have been criticising the Bitcoin dowry deal.

“Ikicollapse nayo? Give back the bride…” a commentator on NTV’s YouTube channel joked.

Another viewer wrote: “That family better cash in on those Bitcoins. The Bitcoin bubble will burst… Eventually.”

But the currency is fast gaining prominence in Kenya as many people try their luck with this fortune whose value has been sharply rising, much that by Saturday , one Bitcoin was selling for close to Sh900,000 locally.

The value was barely Sh10,000 a year ago.

On the global scale, one Bitcoin was selling at $8,480 (Sh875,984).

SELLERS

On Saturday afternoon on localBitcoins.com, one of the platforms where Bitcoins are sold by Kenyans to other Kenyans, there were at least 10 active sellers.

One in Nairobi was selling 0.150544 of a Bitcoin for Sh140,000, which they wanted to be sent to him via M-Pesa.

Another one in Nakuru wanted Sh250,000 sent to his bank account before he could load any willing buyer’s Bitcoin account with 0.26153363 of Bitcoin.

There are many ways of making money though Bitcoin, and Mr Mburu’s preferred way is through “mining”.

PURCHASE SHARES

He is a member of Bitclub Network, which helps Kenyans and other people across the globe buy shares in the Bitcoin enterprise.

The Kenyan chapter of the club, which has more than 1,000 members, meets in Nairobi every Tuesday, Thursday and Saturday.

Asked what one needs to do to get into mining, Mr Mburu replied:

“Just buy shares. The company dealing with that is Bitclub Network. And one unit is going for $599 (Sh61,876).

"So, you buy Bitcoins worth that much and buy that mining capacity; like you buy a machine. It’s a real machine called Antminer S9.”

He adds: “Once you buy it, it’s stored in our facility in Iceland, and there’s a 30-day period of paying that you’ll not be earning.”

GOATS

Ever since he discovered Bitcoin — which he says brings him at least $5,000 (Sh515,500) per month — he has not looked back and he is planning for a wedding in April 2018. “It will be a Bitcoin wedding,” he said.

Mr Mburu was also dismissive of those who say he might have taken his in-laws for a ride.

“They don’t know what it is. Bitcoin has been there, and it’s going nowhere,” he said.

The Bitcoins he paid were and equivalent of 25 goats. He still has 75 to go “which are yet to be paid in Bitcoins” as he put it.

GROWTH

His fiancée runs a clothes shop in Nairobi and she has also been accepting payment via Bitcoin, though the mode of exchange is yet to gain ground in Kenya.

Mr Michael Kimani, the chairman of the Blockchain Association of Kenya, has been dealing with cryptocurrencies since 2012 and says the field will grow exponentially.

“A lot of opportunities are going to emerge from this and I’m trying to position myself with this industry because I honestly think in the next five years, this is going to be so big that people will forget how we used to live without cryptocurrency,” he said.

 

Author: ELVIS ONDIEKI

 

Posted by David Ogden Entrepreneur
David Ogden Cryptocurrency Entrepreneur

 

3 Reasons the Bitcoin Price Hit $8,000 Today

3 Reasons the Bitcoin Price Hit $8,000 Today

The bitcoin price touched the $8,000 mark on Friday morning (or Thursday night, depending on your time zone), enabling the flagship cryptocurrency to check another milestone off its to-do list before it reaches five-figure territory.
 

Bitcoin Price Touches $8,000

Just days prior, the bitcoin price had been trading below $6,000, but a mid-week rally raised bitcoin back to its pre-dip level and ultimately vaulted it to a new all-time high of $8,040 on cryptocurrency exchange Bitfinex.


BTC Price Chart | Source: BitcoinWisdom

At present, the bitcoin price is trading at a global average of $7,741, which translates into a $129.2 billion market cap.

 

3 Factors Behind Bitcoin’s Rally

While a multitude of factors contribute to the movement of the bitcoin price, three stand out as primary drivers of the present rally:
 

1. Wall Street’s Anticipated Entry Into the Markets

Ever since regulated U.S. derivatives exchange operator CME announced it would add bitcoin futures contracts to its product offering, analysts have been counting down the days until Wall Street makes its first major entry into the cryptocurrency ecosystem. Anecdotal evidence indicates that prominent institutional investors are eying the markets with interest — enough interest that Coinbase is launching a cryptocurrency custodial service specifically targeted at institutional investors with more than $10 million in crypto assets.

Related to this is the fact that Wall Street investors are increasingly bullish on publicly-traded companies that enter the bitcoin or blockchain space. Payment processor Square, for instance, received a significant bump to its share price after it rolled out a bitcoin pilot program to a limited number of users of its Square Cash app.

square-cash-bitcoin-price-nov17

2. Successful Lightning-Based Atomic Swap

Though less likely to make its way into the mainstream press, another factor influencing bitcoin’s rally is the successful completion of the first off-chain atomic swap. Accomplished using lightning network technology, developers at Lightning Labs traded testnet bitcoin for testnet litecoin trustlessly and without leaving a record of the transaction in either blockchain. Once the lightning network reaches mainnet implementation, this feature will enable the creation of decentralized cryptocurrency exchanges.

 

3. SegWit2x

Finally, some analysts believe that the bitcoin price received a small bump due to the fact that a minority percentage of miners continued to signal for SegWit2x even though the fork’s most prominent advocates had called for its cancellation. Spencer Bogart, head of research at Blockchain Capital, had told Bloomberg Quint that he believed “some capital is rotating out of other crypto-assets and into bitcoin to make sure they receive coins on both sides of the fork” in the event that it did execute as planned. However, the fork did not occur — or at least has not yet — and fork-compatible nodes remain stuck at block 494782.

 

Author: Josiah Wilmoth on 17/11/2017

 

Posted by David Ogden Entrepreneur
David Ogden Cryptocurrency Entrepreneur

Bitcoin Wallet Blockchain: ‘Buy Some Ether' to Make Transactions After SegWit2x

Bitcoin Wallet Blockchain: ‘Buy Some Ether’ to Make Transactions After SegWit2x

Crypto wallet Blockchain has announced its intention to join with Xapo in following the blockchain with the most accumulated difficulty following the proposed SegWit2x. The wallet service advised its users to “buy some ether” if they intend to make transactions immediately following the fork.
 

Blockchain Wallet to Follow Chain With Most Difficulty

In mid-November, the Bitcoin blockchain is expected to split into two, competing chains following SegWit2x, a hard fork designed to upgrade the Bitcoin network and enable it to scale more effectively. The proposal appears to have strong support from miners and crypto firms — although this support has steadily waned as the fork has gotten closer — but it is opposed by the Bitcoin Core developers, as well as many other businesses and users.

Consequently, bitcoin services have to decide how they will approach the hard fork. Some, such as Bitfinex, are treating the SegWit2x fork as a separate cryptocurrency, while others, including Xapo, state that they will assign the label “Bitcoin” to the blockchain with the highest accumulated difficulty.

Crypto wallet Blockchain — a SegWit2x supporter — has signaled its intent to follow Xapo’s example and determine which chain will receive the label “Bitcoin” based on the amount of accumulated difficulty each blockchain obtains.

Blockchain chief executive Peter Smith made the announcement in a blog post, stating that the service will provide users with access to the coins on the minority chain if they have “significant value”. Like Xapo, they will label the minority chain either BC1 (incumbent) or BC2 (SegWit2x)
 

Buy Some Ether’

Smith goes on to say that Blockchain may suspend outgoing bitcoin transactions following the fork until the networks have stabilized. He suggests users “buy some ether” if they plan to make transactions in late November following the fork.

During this period, it may be necessary to temporarily suspend outgoing bitcoin transactions for a period of time during network instability. However, even in this scenario, your funds will remain safe and you’ll be able to monitor them from within the wallet. You’ll also be able to use all Ethereum related functionality.

“If you have transactions to make around late November,” he adds, “we suggest you buy some Ether in our wallet today.”

 

Author: Josiah Wilmoth on 16/10/2017

 

Posted by David Ogden Entrepreneur
Davkid Ogden Cryptocurrency Entrepreneur

Chinese money dominates bitcoin, now its companies are gunning for blockchain tech

Chinese money dominates bitcoin, now its companies are gunning for blockchain tech

Beijing, China

It’s a sweltering summer night when I’m invited to join a bitcoin miner from Shenzhen at a “bitcoin club” somewhere in downtown Beijing. I’ve just returned from visiting one of the world’s largest bitcoin mines and find myself at a gathering of cryptocurrency enthusiasts at a craft beer brewery in the Sanlitun nightlife district.

I excuse myself from the bitcoin meetup and resort to jumping in a pirate taxi because I don’t have a mobile wallet from Alibaba or Tencent—the primary way to hail and pay for taxis in the city. After paying in cash—now a rarity in China’s mobile payment saturated cities—I disembark, then get lost amid Beijing’s ancient hutongs, the narrow alleyways that link China’s traditional courtyard residences.

My host puts me out of my misery by sharing his location on a real-time map over our WeChat direct messages. Now drenched in sweat, I meet Jack Liao, who runs a bitcoin mining firm called Lightning Asic. He leads me through a dark hutong, coming to a set of carved wooden double-doors. Pushing them open, we enter into the courtyard of a palatially renovated villa. This is my first look at the elusive “bitcoin club.”

The club is located in a 2,000-square-foot villa with a staff of 15, including cooks, cleaners, and wait people. It has two guest rooms, a dining room that hosts two dozen people, a professional Texas Hold ‘Em table emblazoned with the legend, “Faith in Bitcoin,” an automated mahjong table; shelves stacked with fine wine and liquor, a room for practicing Chinese caligraphy, and so on. The table stakes are bitcoin, AliPay credits, and sometimes even yuan, the only non-virtual currency accepted. Guests can sleep, eat, drink, and gamble for free if they’re acquainted with the miners who run the place. “People come here just to chat about projects,” Liao says.

The eye-popping villa bankrolled by bitcoin mining is a symbol of just how lucrative the cryptocurrency industry has been for some on the Chinese mainland. China is home to the world’s largest bitcoin mines, thanks to abundant and cheap electricity, and at one time the country accounted for 95% of the volume traded in global markets. Its central bank is experimenting with a blockchain-backed digital currency, and its biggest companies, from tech giants to industrial conglomerates, are racing to bake blockchain tech into major new projects.

All this points to a central question: How did stateless cryptocurrencies get so big in China, a country where the national currency—along with so much else—remains tightly controlled by the government? Why has bitcoin, along with other cryptocurrencies, flourished with so much vigor here in China? A two-week journey through bitcoin trading operations in Shanghai, mining operations in Inner Mongolia, and the club in Beijing hasn’t answered the question definitely—but it’s gotten me much closer.

Bitcoin is a political statement

Bitcoin began as an experiment in economics and politics, as a project to create electronic money that anyone could use but no one controlled, especially a sovereign authority. The code behind the new currency gave life to libertarian ideals like: money free from government controls on spending and taxation; transactions that could ignore a global, sometimes corrupt banking system; and freedom from central bank targeting of interest rates and inflation. It was also rebuke to the very notion of conventional money.

Bitcoin’s pseudonymous creator, Satoshi Nakamoto, encoded a headline from the Times of London in the first block of transactions ever created on the bitcoin blockchain. It read: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”

Given bitcoin’s political bona fides, it’s a great irony that Chinese companies and individual users are so dominant in its daily activities. The world’s biggest bitcoin miner is a Beijing-based company called Bitmain, which operates two mining pools that control nearly 30% of all the processing power devoted to bitcoin mining. It might seem that Chinese bitcoiners are carrying out some kind of libertarian protest against China’s ruling communist party, subverting the status quo by processing cryptocurrency transactions towards a yet-to-be-revealed political end.

They aren’t.

“In China, bitcoin is one thing and in America and Europe it is another thing,” Liao said as we sipped tea from porcelain cups on the villa’s top floor. Our host, Wu Bi, explains there is no competition between cryptocurrencies and the government-controlled renminbi, at least as the government sees it. “In China our government says bitcoin is not a currency, it is a commodity, so there is no chance it will compete with the renminbi,” Wu told me in Chinese, with Liao translating. “Bitcoin is a great idea, but in China we care more about blockchain.”

Wu and his Chinese compatriots are focused not on the currency, but on the technology behind it. Blockchain is simply a technical way to record encrypted transactions that are distributed across a computer network; once entered they cannot be altered. Instead of using blockchain, or bitcoin, as a permissionless cryptocurrency, banks want to shoe-horn some of bitcoin’s features into current transaction systems to create a low-cost network that, crucially, would require administrators to grant users access. Those administrators, of course, would be banks, or central banks. “Different countries may have different ideas about what is government, and what is the liberty of individuals,” Wu says.

Bitcoin users I met in Beijing were similarly dismissive of bitcoin’s libertarian politics. They did not want to be named or quoted directly, but their argument was essentially this: People in China simply aren’t interested in bitcoin’s potential for political change. And besides, China’s closely controlled economy has delivered prosperity for now—what benefits does bitcoin bring besides as an investment that might appreciate?

Object of speculation

Ordinary Chinese bitcoin users I spoke to, and those who are served by the exchanges and wallet providers, are far more interested in the ability to speculate on bitcoin’s wild price swings—it’s just another way to make money as China continues to adopt characteristics of a market economy.

As it happens, bitcoin arrived just as a class of retail investors in China is growing in size, and seeking better returns than those offered by a restricted financial products market. Even the market for property in China’s top-tier coastal cities, usually reliable for spectacular returns, has been subjected to ever tightening lending restrictions by a government eager to curb speculation. “[Chinese consumers] have had such limited channels for so long, and [bitcoin] was finally one that was not tightly controlled by the government,” says Martin Chorzempa, a research fellow specializing in Chinese internet finance at the Peterson Institute for International Economics in Washington DC.

One seasoned observer of the Chinese bitcoin scene concurs. Eric Zhao is n engineer at the Chinese Academy of Sciences in Shanghai and runs the widely followed Twitter account CN Ledger. Bitcoin became popular almost by default, because of the paucity of products for the Chinese retail investor, he says. “There are not many good investment choices for common people in China. Many people worry about inflation and lots of people feel insecure about their financial status,” he says. “They buy it simply because they believe it will appreciate in value.”

Uncorrelated to major asset classes and generally disconnected from the Chinese economy, bitcoin has been hugely attractive to Chinese investors already overweight domestic stocks and property. Indeed, research from Pantera Capital, a venture fund for blockchain companies, shows that bitcoin is almost completely uncorrelated to major equity, debt, and commodity asset classes. “Because [bitcoin] is globally connected, it’s not easily affected by the Chinese economy,” says Isaac Mao, a longtime entrepreneur and investor in China’s technology scene. “It may be the only economic activity fully connected to the global economy.”

Crackdown

The wild ride on bitcoin in China, however, braked to a stop Sept. 4, when China’s central bank began to take steps to halt domestic bitcoin trading. It started with a ban on “initial coin offerings,” followed by a shutdown of local bitcoin exchanges. China’s authorities have clamped down on bitcoin trading before, most notably in 2014, when the cryptocurrency was on a historic rally driven, in part, by Chinese money.

Now rumors are swirling that a ban on bitcoin mining may be enacted. But if the government has found bitcoin to be a potentially dangerous element in the country’s socio-political mix, why didn’t it crack down before? Instead, it has been relatively tolerant of a technology that was designed to weaken the state’s grip on money.

The rare true believer in bitcoin’s libertarian properties is Bobby Lee, an American who runs the world’s oldest bitcoin exchange, BTCC, in Shanghai. His firm was forced to shut down domestic trading through its BTCChina arm, although it still runs an exchange for non-Chinese traders. When we spoke before the crackdown in August, Lee was enthusiastic about government regulation, saying it would help the market mature. But he also struck a defiant note, saying that bitcoin’s design made it impossible for China’s regulators to shut down. “There is nothing [the Chinese government] can do. That is the beauty of [bitcoin],” he said.

I pointed out that the government could seize exchanges, and even bitcoin mining facilities, and compel their owners to run certain types of code or mess with transactions, thus damaging the cryptocurrency. Lee was sanguine. “They’ll want to control it, but bitcoin was not meant to be controlled,” he said. “You can make all the rules you want, and the question is, can they be enforced? With guns you can say, let’s make guns illegal. But with bitcoin, there’s nothing physical. It’s information, and there’s plausible deniability.”

The reality may be more prosaic. Bitcoin and cryptocurrencies are simply too small to bother the Chinese government much, says Isaac Mao, the investor and entrepreneur and one of China’s earliest bloggers. “The [Chinese Communist Party] doesn’t recognize it as a threat, so bitcoin actually grows very quickly in China,” he told me at a cafe in Hong Kong, where he is now based. “But it’s too small. There is no scale. The market capitalization of bitcoin is about the same as PayPal,” or about $70 billion.

I spoke to Mao in August, but the crackdown doesn’t signal any political threat, writes Chorzempa of the Peterson Institute. It’s more likely that bitcoin trading is just collateral damage from a wider set of restrictions on alternative financial products that have caused billions in consumer losses. Regulators have reigned in not just crypto trading but peer-to-peer loans, trusts, and lending to non-bank institutions this year, Chorzempa writes: “The clampdown thus fits into a broader set of efforts to lessen financial market risks perceived by Chinese policymakers.”

Everyone hates inflation

To the extent that bitcoin trading and mining is a political statement, it’s a demonstration against inflation. Prices in China grew rapidly in the aftermath of the financial crisis in 2008, hitting their highest level in decades in 2007. Inflation has moderated since then, but ordinary Chinese say they still feel the pinch.

Bitmain’s Micree Zhang, who developed its proprietary mining chips, says worry about inflation chewing up his earnings was one reason why he first became interested in bitcoin. “Before I knew about bitcoin I disliked, and was very worried about, inflation. Especially in China in the last 10 years,” he said when I visited with him at Bitmain’s main facility in Inner Mongolia. “When I discovered bitcoin, I knew it was a good idea, very quickly.”

One bitcoin user I met in Beijing told me he was attracted to the cryptocurrency because the government couldn’t devalue it by printing more money, unlike the yuan. The Chinese government controls its currency far more tightly than other major economies.

This level of control can lead to panics. In 2015, the Chinese government devalued the yuan in an attempt to boost economic growth, sending shockwaves through global markets. While today the central bank’s move is seen as astute, at the time Chinese consumers were hit hard, worrying about paying more for everything from Australian beef to New Zealand milk.

Digging for digital gold

China has been the world’s largest electricity producer since it surpassed the United States in 2011. Cheap electricity is the crucial ingredient for a profitable bitcoin mining operation—and China has it in spades. So it’s no surprise that China has become a world center for the activity.

Take Beijing-based Bitmain, for instance. It’s the world’s biggest bitcoin miner, but the company doesn’t divulge its financial data, and there’s no easy way to find out because its beneficial owner is a trust in the Cayman Islands. But one longtime commentator in the bitcoin space, Jimmy Song, has performed an analysis of the firm’s likely profitability. His estimate: $77 million in mining profits for the firm this year, of which electricity and other operational costs come up to about $23 million.

It’s estimated that two-thirds of the world’s processing power devoted to mining bitcoin resides in China. These bitcoin mines take the form of giant warehouses filled with thousands of custom-designed machines and chips, all whirring away to check bitcoin transactions and compete for a slice of the 12.5 bitcoins awarded to a miner every 10 minutes. Collectively, bitcoin miners have collected more than $2 billion in revenue over the cryptocurrency’s nine-year lifespan.

Bitmain leads the pack as both a creator of bitcoin mining rigs and chips, and an operator of vast server farms. It’s now raised $50 million from marquee Silicon Valley investors including Sequoia Capital to expand to the US—perhaps reducing its exposure to Chinese regulations—and to develop a new set of chips for artificial intelligence.
 

Sheer scale

Bitmain’s position as the world’s largest miner is only the tip of Chinese industrial interest on blockchain technology. Last May, a Chinese company called Wanxiang Group, one of the world largest automotive parts makers, sponsored a blockchain hackathon at the Deloitte offices in Rockefeller Center in New York. Wanxiang plans to embed blockchain technology into a new “smart city“—a nine square kilometer plot of land with a planned population of 90,000 people and $30 billion in investment—that it is building from scratch near Hangzhou in eastern China. It was looking for the world’s brightest blockchain developers.

Wanxiang was offering $15,000 to teams who came up with an enticing blockchain project for the smart city, with an additional $1 million in funding. As Wanxiang executive Peter Liang clicked through his slides detailing how blockchains would power everything from the city’s electricity grid to its traffic control system and be embedded in Wanxiang’s factories, the handful of programmers in the room grew both skeptical and awed. “It’s so huge, it’s hard to even believe,” one developer told him.

Wanxiang isn’t the only Chinese conglomerate with blockchain dreams. Beyond cryptocurrencies like bitcoin, some of China’s biggest firms are betting on the technical ideas behind it to revolutionize their businesses. They’re placing much bigger bets than their counterparts elsewhere in the world, who are mired in small-scale trials, proofs of concepts, or slow moving consortia. Chinese companies “are not only moving faster, but the scale of their blockchain ambitions dwarf what we’re seeing elsewhere,” says Garrick Hileman, of the Cambridge Centre for Alternative Finance.

The Chinese e-commerce giant JD has already launched a food supply tracking system using a blockchain in Beijing supermarkets and online stores. The tech giant Tencent has partnered with Intel to develop a blockchain architecture. And the People’s Bank of China, the country’s central bank, has said it’s researching blockchain technology as a way to potentially digitize the yuan.

Blockchains for industry

Unlike firms elsewhere in the world, Chinese companies sense an opportunity to unify the fragmented data flows flowing through their stupendously large and complicated factory floors and supply chains by marrying a blockchain data layer with Internet of Things devices. Conveniently, these applications are also free of the regulation and scrutiny that can slow down financial applications. “I personally believe that non-financial [applications] will go commercial sooner,” says Vincent Wang, Wanxiang’s chief innovation officer.

Foxconn, one of the world’s largest contract manufacturers of electronics and best known for manufacturing Apple’s iPhone, sees blockchain as way for its suppliers to get easy financing. “In China, 85% of SMEs can’t get financing,” Foxconn executive Jack Lee told a conference in New York in May. “They have to go to shadow banking … so it’s very inefficient and costly.” If Foxconn can leverage its current data on small businesses through blockchain, it could create a highly efficient supply chain that could also track delivered goods.

Just as mobile phones allowed China and emerging economies to leapfrog the rich world’s telephone landlines, blockchain technologies could help its industries skip the development of antiquated financial services models. After all, Chinese tech firms Alibaba and Tencent are already processing trillions of dollars through their mobile payments businesses. “We are more interested in getting to a next-generation financial services business,” Foxconn’s Lee says. “That’s the key. As a side benefit for Foxconn, it will streamline the supply chain.”

Those kinds of observations make less worrisome the recent drop in China’s share of bitcoin trading volume as well as rumors on Telegram chat groups about an imminent crackdown on even China’s powerful bitcoin miners. Because Chinese money’s waning influence over the bitcoin markets may be replaced by control over an even greater prize.

As it continues to move from a rural to an industrial economy, China needs to leapfrog the incumbents and assert itself as a technology leader. Bitcoin and the ideas behind its blockchain may be one way to do that—and it may be why China has been a leader of a stateless cryptocurrency for so long.

 

Author: Joon Ian Wong

 

Posted by David Ogden Entrepreneur
david ogden cryptocurrency entrepreneur

Why Bitcoin and Ethereum will soon be everywhere

Why Bitcoin and Ethereum will soon be everywhere

Bitcoin, Ethereum and blockchain technologies are all the rage. Initial coin offerings (ICOs) are raking in millions in mere minutes, and every day a new initiative is announced with ever-increasing hype.

With all of this going on, you’d expect cryptocurrencies to be mainstream fare, right?

Unfortunately, they’re not quite there — yet.

As of now, your grandma probably isn’t wagering Ethereum with her bridge buddies. Heck, even buying pizza with cryptocurrency sounds like science fiction. The fact of the matter is that for people outside of the hardcore crypto-enthusiast community, the whole idea is still mysterious.

This article will help you get a better grasp of the future of cryptocurrency. After you finish it, you’ll clearly see how these technologies are poised to join the mainstream.

So, when will this dizzying race come to an end? Is there real value in the blockchain craze? Can it possibly live up to the expectations created by so many rivers of newsprint?

Below, you’ll find answers to all of these questions and more.
 

The true potential of blockchain technology

As it turns out, distributed blockchain ledgers do have a future.

Not only can they reduce skyrocketing IT costs, but the promise of faster, less-expensive financial transactions has the potential to accelerate growth in a host of industries.

With this great potential comes some bad news, though … you won’t see these possibilities become a reality until the technology becomes useful in the real world.

uber

What will this look like exactly? Well, when you can pay for a ride to a cafe and buy a coffee in crypto — without needing a master’s degree, mind you — its use will be pretty standard.

When crypto goes mainstream transactions won’t be measured in millions of dollars, but trillions.

The explosion of the global sharing economy illustrates how cryptocurrency can go mainstream.

Several companies are already changing the way things are done in this sector. They’re taking products and services that are already in existence and turning them into economic opportunities for millions of people.

In their industry, Uber and Lyft have transformed the way the world thinks about traveling by car. They’ve also empowered people who couldn’t otherwise find work to generate income.

With these businesses, it’s easy for drivers to get started, and they can work on their terms. Due to these reasons and more, Uber and Lyft have taken off like wildfire.

Air B&B

Airbnb also challenges the status quo to provide worldwide accommodations for its users. Not only has it reinvented the way people think about traveling, but it’s been an absolute game-changer when it comes to bringing more money into various communities.

Currently, initiatives like Open Money are laying the foundational groundwork so that software developers can make the vision of universal cryptocurrency acceptance possible. Their platform provides the technological infrastructure that will integrate cryptocurrency transactions into practical, everyday applications.

At the end of the day, companies like Uber and Lyft don’t just change the way we think about the world — they change the world. When it comes to cryptocurrency, companies like Open Money will significantly expand the acceptance of cryptocurrencies by facilitating their incorporation into the software people are already using.
 

Can cryptocurrency acceptance in consumer apps open the floodgates?

Now all of this sounds pretty amazing, but what is needed to bring this vision to reality?

Companies will need to develop strategies that are based on proven market principles to succeed. Namely, they’ll need to empower app developers from all over the world to quickly and easily integrate cryptocurrencies into their applications.

The booming consumer applications market is the ideal starting point for bringing cryptocurrencies into the mainstream. According to a recent research study by We Are Social, more than half of the world’s population now connects to the internet with a smartphone, generating over 50 percent of all internet traffic.

Overall, 3.5 billion people around the globe consistently use mass-market consumer software.

around the world

The real motor of consumer software lies in the hands of software developers. All around the globe, these individuals are innovating solutions that engage their users in powerful ways.

Unfortunately, they don’t currently have the tools they need to make this possible.

Though others are likely to follow in its footsteps, Open Money is the first initiative to provide a state-of-the-art REST API, SDKs and industry best practices designed to facilitate blockchain integration.

Built by developers and for developers, with this solution, it won’t be necessary to start from scratch. Instead, they can leverage an established infrastructure to transition their currently successful apps into the cryptocurrency market, finally enabling you to pay for your pizza in cryptocurrency.

“We want to be the catalyst that takes blockchain technology and puts it in the hands of billions of people around the world. By empowering developers of all sizes to harness the true potential of this amazing technology, we will be contributing to a world that is more efficient, equitable and productive. That’s what the Open initiative is all about,” explained Ken Sangha, COO of Open Money.

The Opportunity

Cryptocurrency is on the brink of change. Soon, app developers from around the globe will empower everyone — including grandparents— to use cryptocurrency with ease. (Nostalgia: $12 checks written by older folks will soon be a thing of the past, so get your cryptowallet ready.) If they succeed, they’ll create a new market that’ll change the economic system forever.

 

by NATHAN RESNICK

 

Posted by David Ogden

David Ogden Cryptocurrency Entrpreneur

 

There's a staffing problem in the blockchain industry: simply, there are too many open positions and too few blockchain specialists.

Now, to help meet that rapidly increasing demand, IBM is partnering with Baruch College, Fordham University, University of Arkansas, University at Buffalo and the University of British Columbia to establish a series of grants, design blockchain curricula and more.

In addition, IBM has added new blockchain resources to it's IBM Academic Initiative, an ambitious effort that opens resources from the global tech giant to 1,000 universities.

But while unique in its sheer scope, IBM's new push is just the latest in a series of efforts around the world to train new blockchain industry talent.

Marie Wieck, general manager of IBM Blockchain, described the results of a beta release of the program to CoinDesk:

"We’ve already gotten some very, very positive responses."

Hands-on learning

Wieck also revealed details about how the programs will leverage IBM's technology.

To start with, IBM Blockchain Platform, the firm's proprietary distributed ledger technology, will form a part of the university curriculum, and will be made accessible for students.

Further, universities that participate in the projects will receive six months access to IBM Cloud and use of the IBM Blockchain cloud sandbox.

And it's becoming increasingly easy to see how such skills would be put to use by graduates of the courses.

The announcement comes on the same day that IBM formally launched its IBM Blockchain Platform, a food supply chain consortium with Walmart and other major firms on board, and revealed the first ever startup accelerator aimed at investing in startups building with Hyperledger Fabric.

Student lockers image via Shutterstock

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Stephen Hodgkiss
Chief Engineer at MarketHive

markethive.com


Get started in cryptocurrency with this beginner's directory

Get started in cryptocurrency with this beginner’s directory

The wonderful world of cryptocurrency has grown from a budding idea to a full-fledged market bonanza. Hopefully you’re savvy to the terminology and ready to start putting your money where your technology is. This directory should provide you with the basic starting points to begin building your fortune in digital money.

(Don’t forget that cryptocurrency is an investment, and you shouldn’t trust your finances to an article you read on a news-source. We strongly advise contacting a financial adviser before risking your money.)

Bitcoin was founded in 2009. It represented the first decentralized cryptocurrency. It’s the oldest, and, as of August 17th it reached an all-time high of over $4,500. Just six months prior it was worth about $900. While you’re trying to wrap your head around that, keep in mind Bitcoin isn’t the only cryptocurrency.

How many cryptocurrency offerings are there? Over 850 are currently listed on CoinMarketCap. Before you decide which one to blow your speculation money on, make sure you have all your crypto-ducks in a row.

You need a wallet

Before you can buy into an initial coin offering (ICO), purchase cryptocurrency, or execute smart-contracts you’ll need a wallet. There are hardware wallets and software wallets; for now we’re only going to worry about software wallets.

Here’s a few to start you off:

  1. Blockchain – possibly the most popular cryptocurrency wallet

  2. Electrium – has been around since 2011

  3. Gemini – boasts regulation by New York State Department of Financial Services (NYSDFS).

Buy an established coin

You don’t have to start off trying to predict which ICO is the best investment. There are numerous ways to aquire cryptocurrency from an established coin. Here are some of our favorite coins to get your research started:

  1. Bitcoin – The big one. If you’ve got $4,000+ to fork out for a Bitcoin you can get in on the over/under $5,000 action. For what it’s worth there are experts on both sides of that fence.

  2. Ethereum – Things get a little more complicated here, but worth listing as a currency simply because ETH is second only to Bitcoin in popularity.

  3. Litecoin – Launched in 2011 billing itself the “silver” to Bitcoin’s “gold”.

  4. Bitcoin Cash – Bitcoin managed to fork itself and now there’s this.

  5. Siacoin – Sometimes cryptocurrency comes in the form of cloud storage.

  6. World Coin Index — provides a great listing to check valuations out

  7. Coin Market Cap — another listing of coin valuations

Or just find an ICO and dive in

Which is easier said than done. It seems like there’s an ICO for everything. We’re hesitant to even list any here, simply because you should research an ICO much more in-depth than would be prudent for the purpose of this directory. However, we’re happy to provide some links that might help:

  1. Coin Schedule – provides analysis on current and upcoming ICOs

  2. Smith and Crown – A curated list of ICOs

  3. ICO List – One of the most popular international sites concerning ICOs

It’s time to hit the exchange

Depending on which coin you’re investing in you’ll either visit an exchange, or use whatever method of purchase or trade the offering requires. You may be able to set up an online store that accepts Bitcoin or ETH, for example. Or perhaps you know someone who will sell you some. One of the most common ways to get cryptocurrency is to visit an exchange.

  1. Coinbase – probably the most popular exchange there is

  2. Kraken – you’ll find this one is well-reviewed by insiders

  3. Bittrex – US based and supports nearly 200 cryptocurrencies

  4. Buy Bitcoin Worldwide— provides country-specific exchange information

The above links should provide you with enough information to get you started on a path to dominate the cryptocurrency markets and become rich beyond fantasy. Or you could lose a bunch of money.

by TRISTAN GREENE — 13 hours ago in EVERGREEN

 

Posted by David Ogden
Entrepreneur

Bitcoin Development Similar to
1800s Gold Rush

    

Present day Bitcoin and altcoin development

appear to be recounting a theory that played out in the early mining industry. As was the pattern during the actual gold rush of the 1800s, while some people took the risk and spent their time looking for gold, other folks watched on non-judgmentally and lucratively supplied the "picks and shovels" that enabled the fever-pitched masses to take a shot at "striking it big." Drawing on some similarities and contrasts between the actual "gold rush" and the new "digital gold rush" provides a good framework to describe how industries today are being impacted by Bitcoin. Bitcoin evangelist and technologist Melvin Petties explains how the emergence of Bitcoin has given rise to different kinds of related endeavors, pointing out the attitude of some key players and the impact on the crypto ecosystem.

Picks And Shovels Model: Industries That Make Equipment

According to Petties, in the olden days, the absolute quantity of precious metal was not known so the risk of participation was greater. The big rewards were random yet impactful – whole towns were built from major gold strikes, which made the lure to participate even greater.  People from all walks of life, even the very poor, were compelled to participate and their chances of success were arguably relatively the same.

Irresponsible

Fast forward to the present day, Petties notes that not just anybody can make a "pick and shovel" when it comes to Bitcoin mining.

Petties says:

“In fact, the technology is so coveted that for the years between 2013-2015 (Bitcoin good time days) most mining equipment providers were ultimately found to be fraudulent or irresponsible in how they pre-sold equipment but never delivered it.”

Petties explains that microchip shortages were always the common scapegoat. However, the real issue was that most people who knew how to make a real pick and shovel (ASIC chip-based mining computer) held onto the knowledge, built the product, mined with it for most of its practical lifetime (innovations were happening every month and the difficulty level was rising even more rapidly due to the rush of entrants) and then delivered it to the customer only when it was virtually worthless.  

Wild West Days

Also, most other cloud mining or new mining equipment companies were either not worth the ROI at the time (if you were thinking short-term) or an elaborate pre-order scam/trap for victims. The latter was willing to send Bitcoin to anywhere in the world to receive a miner.  Consumer protection was non-existent which made the "buyer beware" burden too heavy and often times a soul-crushing experience to be scammed. Compared to the gold rush of the 1800s, Petties notes that it was not possible to have a massive stealth mining operation. However, in the crypto age, that's exactly what a lot of companies did to cement their space and build a massive moat around themselves to eventually experiment with other value-added services to be built on top of the network that they breathed life into.

Me Too Shops

Another area of significant comparison in terms of activities surrounding the development of Bitcoin is the “value-added service industry.” Petties points out that in the 1800s during the gold rush, pop-up towns and communities were the norms. When a lucky team would strike a big vein they would ultimately reinvest the wealth back into the community, opening banks, general stores, parlors, salons and housing for the existent and soon to arrive patrons that would have certainly heard the news and set their sights to capture some of that same luck.

In the big booming Bitcoin days, this represents all of the "me too" shops that began to publicly accept Bitcoin and make a splash in the news. All the activity served to drive more and more VC money into the space as the community searched for "killer apps" that would live on top of Bitcoin and usher in Bitcoin 2.0 – streamlined payments, borderless markets, no remittances, etc. Ultimately, the most impacted industries were not retail due to the existing reluctance towards the mainstream adoption of the cryptocurrency.  

Value-Added Services

Petties sees some positivity from the circumstances. He notes that what happened through all of that is the discovery of financial services as the real added value, namely legitimate exchanges that were run by competent folks who knew how to secure digital currency and could partner with banks and insurance companies to properly protect customer accounts. Petties concludes by explaining that because Bitcoin, as money, is Blockchain's first "killer app," the obvious industries that will shine will be those that facilitate the safe transfer of crypto and investment exposure – that is financial services. “I'm encouraged by the strides that the Winklevoss brothers have taken to make that a reality,” says Petties. “True pioneers in understanding the need to make digital currency safe and broadly available in a regulatory compliant way.”

Chuck Reynolds


Marketing Dept
Contributor
Please click either Link to Learn more about -Bitcoin.

Bitcoin, Ethereum Lead the Way as Cryptocurrencies Retreat into the Red

    

Cryptocurrency traders woke up to a sea of red this morning

, as 92 of the top 100 cryptocurrencies by market cap experienced a marked price decline. The bitcoin price led the retreat, falling over 6% toward $2,400. Bitcoin has declined almost $600 since it pierced the $3,000 barrier two weeks ago.

No Flippening Today

Bitcoin price declines always increase discussions about the “Flippening,” the potential future event when another cryptocurrency (presumably Ethereum) will supplant bitcoin as the largest cryptocurrency by market cap. However, Ethereum has been dealing with its own problems. On June 22, it experienced a flash crash on GDAX, although it quickly recovered. More worrisome is the fact that Ethereum is experiencing network congestion and has yet to implement a long-term solution. Consequently, the ethereum price has fared even worse than bitcoin. In the past 24 hours, the ethereum price fell 13% to $285.23. Ethereum too has been experiencing an elongated price decline, having fallen nearly $130 since it hit $410 on June 12. Significantly, ethereum’s ~$26.5 billion market cap is now only 63% of bitcoin’s ~$41.8 billion market cap.

Massacre Extends to Altcoins

The Monday Massacre did not stop with bitcoin and ethereum; altcoins are down across the board. Not even litecoin, which has experienced a price resurgence over the past several months, could swim against the current. The litecoin price fell 9.87% to $41.29. It has fallen nearly 20% since it topped out at $50 leading up to its listing on BitStamp.But the massacre did not stop there Only eight of the top 100 cryptocurrencies managed to avoid the bloodbath. Thirtieth-ranked Byteball was the largest cryptocurrency to experience a price increase, just barely moving the needle 1.84% to $781.20. Tether, MCAP, LEOCoin, OBITS, and Mooncoin each managed to tread water or increase slightly.

Lest one attribute the altcoin price decline to the fact that most altcoins rely on bitcoin as their major trading pair, the price charts look nearly as bad when you switch from USD to BTC. Nearly every altcoin declined against bitcoin. The lone standout in the top 100 was 54th-ranked CloakCoin, whose price rose 41% to $10.09 (.0037 BTC). This is a new all-time high for CloakCoin, who previously rose to a high of .0033 BTC in late July 2014 before crashing in August and September.

A Bump in the Road or Cause for Concern?

Mainstream economists and news outlets rush to pronounce bitcoin’s impending doom every time it experiences a price decline, so don’t be surprised if you see some trigger-happy “Is This the End for Bitcoin?” headlines pop up in your newsfeed if the downward trend continues. Nevertheless, it is far more likely this market downturn is just a bump in the road for cryptocurrency prices. That said, both Bitcoin and Ethereum are facing scaling difficulties and will need to implement long-term solutions. Bitcoin’s test will come with the upcoming Segwit2x activation. All signs indicate Bitcoin will avoid a network fork on August 1, but any unexpected developments could lead to price volatility.

Chuck Reynolds


Marketing Dept
Contributor
Please click either Link to Learn more about -Bitcoin.

Factors Pushing Bitcoin Prices
Higher in 2017

For newcomers to the market looking to make a quick win, the rollercoaster of a year has probably been a time of scratching heads and possibly a few tears shed. For the long-term investor, however, these periods are part of the journey and opportune times to snap up some more coins when the price takes a dip. Despite the precautionary cries of ‘bursting bubbles’, these market corrections are an anticipated occurrence.

    
Legislative Changes for Cryptos

Earlier this year, Japan announced that as of 1 April 2017, the country would recognise bitcoin as legal tender and make the provisions for administrative and accounting systems to be enhanced for cryptocurrency transactions to take place seamlessly. This was undoubtedly the major contributing factor to an initial surge in the price as Japanese individuals and corporations alike scrambled on exchanges to secure bitcoin for future purchases. Hundreds of thousands of retailers in the area are said to be equipping themselves to accept bitcoin payments, with a low cost airline, Peach, becoming the first commercial carrier to directly offer consumers tickets paid in bitcoin.

Australia quickly followed suit, announcing accelerated amendments to legislation that eliminated the incumbent double taxation on digital currency transactions. As it stands, Australians using bitcoin for transactions are liable for the 10% goods and services tax (GST) plus a further 10% tax for using ‘intangible property’ as a payment medium. Come 1 July 2017, these transactions will only attract GST, and be exempt from further taxation, no doubt fuelling a greater adoption of digital currency transactions. The proactive progression by these countries certainly paves the way for others to learn from their integration and regulatory practices, empowering mainstream bitcoin adoption, which naturally pushes the price higher as demand increases.

Scaling Debate Resolution

The scaling debate has been a long-standing hurdle for Bitcoin growth. The decentralised nature of bitcoin, which naturally is one of its most appealing qualities, presents some challenges when it comes to governance of remedial action. In an ecosystem where no single entity can dictate changes to the framework, a majority consensus must be reached. The fact remains that Bitcoin needs to scale from its current transactional capacity in order to meet the demands placed on the network in terms of the growing number of transactions, as the current block size is impeding quick and cost-effective transactions.

Whilst several proposals have been put forward, the Bitcoin community have yet to come to agreement on a viable solution that satisfies the majority, while at the same time doing what is best for the wider user base. In May 2017, at the annual Consensus conference, held in New York, an agreement has been signed by a ‘critical mass of the bitcoin ecosystem’ that set out a plan for the adoption of SegWit with a planned hard fork to a 2MB blocksize within six months. While further clarity is needed, it would appear that we may finally come to a point of breaking the stalemate, which will contributing factor in Bitcoin being able to advance and reach its full potential.

Economic and Political Uncertainty

One of Bitcoin’s undeniable drivers of growth are citizens who have lost confidence in their country’s ability to maintain sound economic and political policies, and desperately seek to establish their own sense of financial freedom outside the manipulation of governments.

Venezuela

Take Venezuela for example. An overly aggressive expansionary monetary policy has resulted in hyperinflation, which the International Monetary Fund (IMF) expects to reach an explosive 1,660% this year. This has led to an unparalleled economic and social crisis. The removal of the 100 Bolivar note (the largest denomination and still worth only a few US cents) from circulation in December 2016 alongside the lack of availability of the planned 500 to 20,000 Bolivar notes, led to widespread chaos and violent protests amongst Venezuelans, who for the most part were heavily reliant on cash but were effectively left without money for weeks on end.

It is reported that the minimum wage is around 200,000 Bolivars, yet a single basket of groceries costs in the region of 770,000 Bolivars, nearly 4 times the minimum monthly wage. Whilst the government provide some subsidised basic goods, the ‘outlets’ have become hotspots for vicious crime and citizens have to weigh up the risks of cheaper food against the dangers that face them in the queues. This is what happens when people reach such levels of despair to survive. The alarming surge in crimes such as kidnapping and murder leave most Venezuelans living in fear for their lives on a daily basis, with little in the way of respite.

India

India is another prime example, where the most recent, and possibly most extreme case of a modern-day war on cash occurred in December 2016. Under the pretence of curbing criminal action and tax evasion, Prime Minister Narendra Modi effectively wiped out 86% of notes in circulation overnight, when he announced the demonetisation of 500 and 1,000 Rupee notes with immediate effect. Exchange was possible, but within a limited time frame and only up to a certain amount, the rest having to be processed via a bank account. This, in a country where almost half its population has no access to formal banking, let alone a bank account. This is just one of the reasons bitcoin holds such appeal in tempestuous economic climates. With Bitcoin, you are assured a level of financial security your money is removed from the coercion of the centralised system, therefore protecting your wealth from political agendas, damaging inflation and capital controls.

Increased Inflow of Institutional Money

Financial institutions, who are historically wary about Bitcoin are increasingly showing signs of interest in the digital asset. When compared to the performance of stock markets and fiat currencies, combined with more and more regulatory structure coming into place, it is unsurprising that institutional money has started flow into the crypto-economy. Regulation is arguably one of the largest barriers to cryptocurrency investment for institutions. Two nations, in particular, have been influential in this regard; Sweden and Japan. Sweden was one of the first movers in terms of a regulated Bitcoin investment. Back in May 2015, the KnC Group launched the world’s first ‘Bitcoin Tracker’ known as an exchange-traded note (ETN), which is publicly traded on a regulated exchange. This represented massive progress for Bitcoin at the time and essentially opened the market for institutions and private individuals to gain a regulated exposure to Bitcoin.

The ETN is designed to mirror the price movements of the underlying asset being USD/BTC. The company offering the ETN, XBT Provider, is required to hold the equivalent number of bitcoins as the number of ETN’s issued. In other words, when a financial institution or private investor purchases, XBT Provider has to purchase the same amount of bitcoins to back up the note. Earlier this month, Hargreaves Lansdown, the UK’s largest brokerage, announced that their clients would be able to access the ETN via their SIPP and brokerage accounts. This has opened the doors for retail and institutional investors to gain a regulated Bitcoin exposure in the UK.

As mentioned earlier, Japan has played a crucial role in moving bitcoin into the mainstream. This move has provided institutional players with the much-needed vote of confidence required before they got on board. Russia and India are looking likely to be the next countries to announce positive legislation after an increase in interest within the regions. This will further stimulate institutional investment into Bitcoin, leading to a stronger and more prosperous market for all.

Mainstream Momentum

Perhaps this can be linked back to the fact that with growing interest, and impressive growth, the media have been covering Bitcoin more and more frequently, exposing it to a wider audience. Personally, I have had more and more dinner table discussions about Bitcoin with friends, family, ex-colleagues and acquaintances, outside of the ‘cryptocurrency world’, all now showing interest in Bitcoin.

It was this month that the Wall Street Journal mentioned Bitcoin on its front page, highlighting that Bitcoin has had a strong 2017. This mainstream recognition for Bitcoin’s performance has been long awaited and will be a stimulus for continual momentum. It was only 2 years ago that most of the mainstream news stations were reporting Bitcoin’s demise. What a turn of events it has been. The factors I have outlined above are merely a few of the positive fundamentals Bitcoin has going for it. Driving demand, expanding its utility and subsequently, increasing its value and price. So yes, I am confident when I say that Bitcoin will continue to break through all time highs and find favour above the $3,000 mark before the bells ring in 2018.

Chuck Reynolds


Marketing Dept
Contributor
Please click either Link to Learn more about -Bitcoin.