Category Archives: Bitcoin

It's worth more than an ounce of gold right now, it's completely digital and it's the currency of choice for the cyberattackers who crippled computer networks around the world in recent days.

When the attackers' "ransomware" sprang into action, it held victims hostage by encrypting their data and demanding they send payments in bitcoins to regain access to their computers. Bitcoin has a fuzzy history, but it's a type of currency that allows people to buy goods and services and exchange money without involving banks, credit card issuers or other third parties.

Here's a brief look at bitcoin:

HOW BITCOINS WORK

Bitcoin is a digital currency that is not tied to a bank or government and allows users to spend money anonymously. The coins are created by users who "mine" them by lending computing power to verify other users' transactions. They receive bitcoins in exchange. The coins also can be bought and sold on exchanges with U.S. dollars and other currencies.

HOW MUCH IS IT WORTH?

One bitcoin recently traded for $1,734.65, according to Coinbase, a company that helps users exchange bitcoins. That makes it more valuable than an ounce of gold, which trades at less than $1,230.

The value of bitcoins can swing sharply, though. A year ago, one was worth $457.04, which means that it's nearly quadrupled in the last 12 months. But its price doesn't always go up. A bitcoin's value plunged by 23 percent against the dollar in just a week this past January. It fell by the same amount again in 10 days during March.

WHY BITCOINS ARE POPULAR

Bitcoins are basically lines of computer code that are digitally signed each time they travel from one owner to the next. Transactions can be made anonymously, making the currency popular with libertarians as well as tech enthusiasts, speculators and criminals.

WHO'S USING BITCOIN?

Some businesses have jumped on the bitcoin bandwagon amid a flurry of media coverage. Overstock.com accepts payments in bitcoin, for example.

The currency has become popular enough that more than 300,000 daily transactions have been occurring recently, according to bitcoin wallet site blockchain.info. A year ago, activity was closer to 230,000 transactions per day.

Still, its popularity is low compared with cash and cards, and many individuals and businesses won't accept bitcoins for payments.

HOW BITCOINS ARE KEPT SECURE

The bitcoin network works by harnessing individuals' greed for the collective good. A network of tech-savvy users called miners keep the system honest by pouring their computing power into a blockchain, a global running tally of every bitcoin transaction. The blockchain prevents rogues from spending the same bitcoin twice, and the miners are rewarded for their efforts by being gifted with the occasional bitcoin. As long as miners keep the blockchain secure, counterfeiting shouldn't be an issue.

HOW BITCOIN CAME TO BE

It's a mystery. Bitcoin was launched in 2009 by a person or group of people operating under the name Satoshi Nakamoto. Bitcoin was then adopted by a small clutch of enthusiasts. Nakamoto dropped off the map as bitcoin began to attract widespread attention. But proponents say that doesn't matter: The currency obeys its own internal logic.

An Australian entrepreneur last year stepped forward and claimed to be the founder of bitcoin, only to say days later that he did not "have the courage" to publish proof that he is.

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AP Explains: What is bitcoin? A look at the digital currency - ABC News

Bitcoin has shown amazing, and fairly steady, growth over the last year.

A single bitcoin was worth just $455 in May 2016. And even after retrenching slightly from a record Thursday high of over $1,800 per token , it has shown a stunning 286% annual return, based on prices from CoinMarketCap.

As with most assets, explaining bitcoins bull stampede is more art than science. Bitcoin's price is fundamentally linked to how many people use the system to send money. But it's currently mostly driven by speculators, who trade on their belief that it will become more popular in the future. Positive news on that front has been plentiful in the last three months in particular.

Globally, Bitcoin is being treated with a great deal more respect by regulators. Positive comments about blockchain by Minneapolis Federal Reserve President Neel Kashkari coincided with the latest Bitcoin price surge. Japan approved Bitcoin as a legal method of payment in early April , and Chinese regulators have made progress in squaring Bitcoin usage with that countrys tight capital controls.

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There have been positive internal indicators, as well. Bitcoins major headwind is an ongoing debate over scaling up the system to handle more transactions. While that effort is still basically stalled by bitter infighting , some have seen a positive development in the successful deployment of a solution known as Segregated Witness on the LiteCoin system, which is largely a Bitcoin clone.

When considering further upside on Bitcoin and other cryptocurrency, one factor looms above all: cryptocurrency is still essentially off-limits for institutional investors. While venture capitalists have poured more than $1.5 billion into blockchain startups, the tokens themselves dont meet regulatory standards for more traditional funds. Once something like the Winklevoss twins proposed Bitcoin ETF is approved, the pool of potential Bitcoin investors will explode overnight .

There are also two very important points of caution. First, Bitcoin is still a risky asset in the short term. Boosters were just as excited when it peaked at over $1,100 in late 2013and the price then spent years gradually slumping, reaching a low of $200 in mid-2015.

Theres also a serious long-term downside risk to Bitcoin. While the potential of Bitcoins underlying blockchain technology is widely acknowledged, Bitcoin itself is now only one of dozens of implementations of the idea. Bitcoin has a big first-mover advantage, but innovators with names like Ripple and Dash have already significantly expanded on its features.

Foremost among those innovative competitors is Ethereum, the second-largest cryptocurrency, whose price has also spiked over the last month. Many entrepreneurs building blockchain applications are using Ethereum, so its likely to share inand maybe even cannibalizeBitcoins long-term growth.

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Why Bitcoin's Price Has Been Surging and Where It Could Go From Here - Fortune

It appears this BIP in question "clones" the governance layer found in the Decred altcoin.

It looks like we have another social media tussle on our hands right now. Bitcoin developer Luke Dashjr has introduced a new BIP. That is nothing unusual, as there are many improvements to be made where Bitcoin is concerned. However, this particular proposal seemingly uses the governance layer found in the Decred altcoin. An interesting way to go about things, although it raises a lot of eyebrows.

Many people seemingly agree useful altcoin features may find their way to Bitcoin at some point. This is part of the reason why some people feel altcoins have a lot of merit. Bitcoin can use quite a few improvements, that much is evident. If an altcoin comes up with a new feature, it can be modified to become a part of the Bitcoin protocol. However, a recent BIP by Bitcoin developer Luke Dashjr has people up in arms right now.

It appears this BIP in question clones the governance layer found in the Decred altcoin. Interestingly enough, Luke Dashjr feels any correlation with the Decred source code is a mere coincidence. In fact, he claims several developers have been looking at introducing a similar BIP over the past few years. One could also argue how every alternative cryptocurrency in existence right now copies Bitcoin, although that is a different conversation altogether.

Introducing a governance layer in Bitcoin would be quite a significant feat, though. Doing so would require a soft fork of the code, assuming it will ever become a part of Bitcoin. The BIP focuses on a new opcode for the Bitcoin scripting system. As a result, transactions can be constructed which are valid only within blocks signaling for or against arbitrary network upgrades. It is an interesting BIP to keep an eye on, that much is certain.

Some users on Twitter are pointing out the irony of this BIP, though. An earlier tweet by Luke Dashjr mentions how governance is nothing but a threat to Bitcoin. Any attempts to govern Bitcoin are an issue, in his opinion. It is important to note said statement is part of a block size debate taking place on Twitter earlier this year. Rest assured it is not the last we will have heard regarding this BIP and governance in Bitcoin.

Header image courtesy of Shutterstock

Link:
New Bitcoin Governance BIP Causes Twitter Controversy - newsBTC

Bitcoin price surged higher above $1800 against the US Dollar, and the current movement in BTC/USD looks very bullish for more gains in the near term.

Bitcoin price surged higher above $1800 against the US Dollar, and the current movement in BTC/USD looks very bullish for more gains in the near term.

It was a nasty week for Bitcoin price, as it continued to gain momentum above $1700 against the US Dollar. My view of continuing gains in BTC is playing well. Recently, the price traded close to the $1910 level from where a correction was initiated. The price traded below the 23.6% Fib retracement level of the last wave from the $1510 low to $1905 high.

On the downside, a monster bullish trend line with support at $1660 on the 4-hours chart of BTC/USD was waiting. It acted as a barrier for further declines below $1650 and pushed the price back higher. There was also a test of the 61.8% Fib retracement level of the last wave from the $1510 low to $1905 high. The price is now back above the $1800 level. It looks like a correction wave is over, and the price may soon retest the last swing high at $1905.

If all goes well, there is a chance of further gains above $1900. On the downside, we have two bullish trend lines at $1660 and $1610, which may continue to act as a support. The overall trend is bullish with a chance of BTC/USD testing $2000.

Looking at the technical indicators:

4-hours MACD The MACD is currently gaining momentum in the bullish zone.

4-hours RSI (Relative Strength Index) The RSI is now back above the 50 level and heading north.

Major Support Level $1660

Major Resistance Level $1900

Charts courtesy SimpleFX

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Bitcoin Price Weekly Analysis BTC/USD Eyeing $2000 - newsBTC

This weekend has been quite eventful for Bitcoin. After reaching a new all time high of $1800, the price dipped over $200 to a low of $1600. However, the market displayedstrong support at that level and is currently showing signs of recovery.

As SECs second decision date approached by May 15th, the market is showing clear signs of uncertainty. Both the bears and the bulls are pulling the strings in their directions. One concerning sign is the lack of volume during the recovery.

The market RSI has also decreased, signalling a lack of fuel for further momentum. If a few big players decide to exit their positions the market may tumble down to the $1600 support levels once again.

According to the SEC, all documents regarding the appealed bitcoin ETF application must be submitted by May 15th.This does not necessarily mean that the decision will come right away, but there is no reason it shouldnt come soon after.

Two months ago, the SEC released their decision around 5PM, after the stock market closed. Usually the agency release statements after hours,to make sure the stock market is closed for the day and cannot be manipulated, but since there are no Bitcoin stocks there is no reason why they wouldnt release a statement earlier. Make sure to vote if you think the Bitcoin Petition for Review will be approved:

On another note, the biggest ransomware attack the world has ever seen has been successfully thwarted by MalwareTech security analysts. The solution was incredibly simple buy the unregistered domain that the malwarewas using for payload propagation.

Furthermore, analysts confirmed that the masterminds behind the worlds biggest ransomware attack have made an embarrassingly small amount of money only $26,000. The viral nature and the quick shut down of the attack has shedmore light on Bitcoin, which undoubtedly contributed to the positive market pressure.

Dislaimer: This is not trading advice, this article is for educational purposes only. If you liked this article, follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin, cryptocurrency, and technology news.

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Bitcoin Price Recovering After Testing Support, Awaiting SEC Decision - The Merkle

Dr Paul Ennis is a research assistant at The Centre for Innovation, Technology & Organization at University College Dublin, specializing in bitcoin and blockchain studies.

In this feature piece, Dr Ennis investigates the daily activities and political attitudes of China's well-established bitcoin mining sector, positioning his findings within the context of the network's scaling debate.

At present, the bitcoin community is engaged in a voracious debate about how best to scale the network. But in such a context, it's sometimes all too easy to overlook the human figures involved in that debate.

Positioned on one side are the Bitcoin Core developers, (a term many wish to avoid reifying) but who nonetheless are recognizable as a cadre of sorts. On the other side of the debate, underrepresented and frequently misunderstood, are the China-based mining pools and hardware providers.

We reached out to three mining pools AntPool, Bixin and BW to get a varied perspective on how they feel about Western attitudes toward them, but also how the day-to-day operations of mining occur.

Bitcoin culture can, at times, be argumentative, and this is at least partially attributable to the communication gap between China and the English speaking world. Virgilio Lizardo Jr, head of international for Bitbank Group (owners of BW pool), describes the language barrier between China and the English-speaking world as "immense", leading to a dialogue blighted by miscommunication.

One significant effect of this divide, Virgilio emphasized, is that due to the lack of Chinese presence on English-speaking bitcoin forums, stereotypes of Chinese miners continue to proliferate.

The sentiment is echoed by perhaps the most well-known Chinese miner of them all, Jihan Wu, co-founder of Bitmain, the operator of AntPool.

He told CoinDesk:

"A lack of a common discussion field has allowed for the creation of an echo-chamber in the technical community outside China, where the voice and interests of the Chinese miners are misunderstood and not represented."

Lizardo, a transposed Westerner with a strong sense of Chinese culture, noted that one overlooked issue is that the miners have no obvious media outlet to get their position across, leading to distorted narratives and the compounding of mistrust.

He further emphasized that there is a tendency to group the Chinese miners together as a single "monolithic entity".

However, their visions for the future are predictably diverse. While Wuis an open supporter of Bitcoin Unlimited, positions toward the scaling debate vary enormously across the miners.

Asked for his opinion, Tyler Xiong of Bixin, formerly HaoBTC, argued the importance of maintaining a single implementation of the protocoland a healthy community, stating: "We don't want the breakup of bitcoin".

This is contrary to Wu, who commented:

"I believe multiple implementations are healthy for the bitcoin ecosystem."

Wu also stressed that it is important to recognize that the mining operations in China and elsewhere are businesses, each with their own agenda and strategies.

According to Wu, while there is a general consensus among miners that bigger blocks are needed, "most miners prefer to stay away from the discussion" and focus on the daily operation of their businesses.

As is well-known, information about the actual, day-to-day mining operations in China are hard to come by. Occasionally, we will get photographs or videos of vast-industrial warehouses packed with whirring mining machines, but not much more.

Often situated in the depths of the Chinese countryside they are, admittedly, aesthetically powerful: equal parts industrial traditionalism and science fiction. Most of the miners confirmed what many have long-known about why China cornered the mining market cheap electricity.

Wu, arguably the most successful mine operator in the history of bitcoin, said the most challenging part of planning a new mining farm is finding access to a low-cost and reliable electricity supply. Lizardo also reported that while constructing a mine is not difficult the "logistics of transporting thousands of miners is challenging."

Tyler painted a picture of what occurs once construction is complete:

"The daily job includes 1) the installing, maintenance and repairing of miners and other facilities, and 2) monitoring the temperature in different areas of the mining farm. It requires a lot of passion because there are tens of thousands of miner at the same time and you want all of them are available 24/7."

At BW pool, most of the labour is drawn from local communities, trained by the company to become technicians and maintenance workers. Each miner we spoke to stressed that looking after the mines was a 24-hour job, requiring constant supervision by employees.

Jihan highlighted this same phenomenon, stating:

"You need to human resource to constantly look after the farm, you need to maintain constant and direct communication with the investors of your farm, you need to maintain the mining equipment."

The take home across all the interviews was that mining was, at heart, a difficult, costly and time-consuming job.

Further, that perhaps in the fog of endless debates we have lost sight of the important function Chinese miners have for bitcoins maintenance and security.

Shanghaiimage via Shutterstock

ChinaMiningBitcoinScaling

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Bitcoin's Scaling Debate: The View From China's Miners - CoinDesk

With a 94 percent year-to-date gain, and a single "coin" now worth $1,843, bitcoin has been on a helluva run lately.

Theincrease in the cost of the massively-volatile electronic tokens has led to many comparisons with that other favorite outsider "currency'' gold recently.

True, a unit of Bitcoin passed the dollar value of one troy ounce of gold this year, and is now more than $600 higher.

But the daily swings in the digitally created asset have been vast. Evenduring the huge run up this year, it has movedmore than fivepercent on 21different days, with nine of those being moves lower. Gold on the other hand, has been much more stable.

Volatility aside, there is amajor problem with gold as a comparator for the software-based unit.

Nobody thinks comparing one shareof Apple Inc. current price around $155 with one shareof, for example, outdoor lighting company Acuity Brands Inc. current price around $178 is valid. It certainly does not show that Acuity (market cap $7.9 billion) is worth more than Apple (market cap $814 billion).

By the time the supply of new bitcoins ends, sometime after the year 2110, there will be 21 million bitcoins in (digital) existence, meaning the total value of all of the electronictokens that will ever exist, at today's market price, is just under $39 billion. According to the World Gold Council, total gold stocks amount to approximately six billion troy ounces, or $7.3 trillion at today's price.

To put it another way, in order for bitcoin to be worth more than gold, a one 'coin' would have to trade at $347,000 in order for 'bitcoin worth more than gold' to be a defensible statement.

Must dash now, one bitcoin is about be worth more than one aluminum future...

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And a Bitcoin Is Now Worth... - Bloomberg

Gillian Hamm, a general practitioner in England, received this message on her computer Friday. Gillian Hann via Twitter

"It's a small ransom," said Gene Spafford, founder and executive director emeritus of Purdue University's Center for Education and Research in Information Assurance and Security. "But if you set the price too high then many of their victims won't pay."

Spafford said ransomware typically targets those without strong security in place, such as home users and small companies.

Hospitals and larger companies might be susceptible, he added, if they're slow to fully upgrade their networks or use pirated programs.

This particular ransomware is "using this flaw in the file-sharing that is giving it apparently a real boost," Spafford said.

He added that companies are at the mercy of the hackers, who could decide if their ransomware becomes too big they might decide "not to cash out because they're worried about being traced" and tipping off authorities about their whereabouts.

Spanish telecom giant Telefonica confirmed in a statement that a "cybersecurity incident" occurred Friday that affected the computers at its Madrid headquarters.

A Telefonica spokesman told Reuters that a window appeared on its computers also demanding a bitcoin payment in order to regain control.

Spain's National Cryptology Center said that an attack had been launched "against various organizations" in the country through their Windows systems, and other companies were taking preventative measures.

It wasn't just companies affected by this particular ransomware.

The mayor of the small community of Timra, Sweden population 10,000 told Reuters it has "around 70 computers that have had a dangerous code installed."

Josh Feinblum, vice president of information security at the cybersecurity company Rapid7, said companies should back up data and ensure their systems are as up to date as possible. He said the speed at which the ransomware spread is unusual.

"I think what was unique about this ransomware is that it essentially used a security flaw in a very common set of software that allowed it to self-replicate across the facilities and environments that it was in," Feinblum said.

"And that's not very typical in the ransomware world and that's something that we haven't really seen at scale in a long time," he said.

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Cyberattack Hits Nearly 100 Countries and Thousands of Computers - NBCNews.com

No one wanted it to come to this, but circumstances require that we talk about bitcoin. I mean, just look at this:

The worlds favorite digital currency doubled between May of last year and January then doubled again into this month, with a particularly ferocious streak in the past five days. Blocks of code denoting the existence of a single bitcoin fetcheda high of $1,832 on Thursday before slumping Friday.

As always, the proximate causes for the run-up are murky. Last month Japanese authorities shrugged and admittedthat bitcoin might as well be considered a currency, a much-needed morale boost after the SEC decided that bitcoin ETFs were an abomination of nature not destined for this world. It doesnt seem to matter, however, that Germanys Bundesbank made the opposite judgment earlier this week:

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Bitcoin is a means of exchange which is not issued by a central bank, but by unidentified actors. I do not see it as a currency, Carl-Ludwig Thiele, a board member of the German central bank, told the newspaper Welt am Sonntag. If you think Bitcoin would be as safe as the euro or the dollar, you have to take responsibility for it. We can only warn people not to use the bitcoin to preserve purchasing power.

Bitcoin rose another 7 percent in the days following Germanys pronouncement.

You can find all sorts of other justifications for the recentexplosion. Heres a redditor saying its about a MASSIVE rise of the public interest in Bitcoin in Latin America (and some other regions). Heres a guy who thinks paying for stuff with a smartphone, asmillions of people currently do with fiat currency, is helping drive bitcoin up.Heres a guy launching a fund to attract institutional investors to bitcoin arguing that institutional investors have become attracted to bitcoin:

The biggest driver right now is youre starting to see institutional investors take a keen interest in the entire sector, said Brian Kelly, founder of Brian Kelly Capital, which recently launched a digital assets fund for outside investors.

I dont think this is hot money. This is real money thats going to sit around and build the new internet, Kelly said, citing his conversations with institutions and other investors.

Whatever the reasons, if there are any, its a good show. To wit:in the course this posts creation, bitcoin went from a day of feeling queasy to a day of spewing chunks. Over the last 24 hours the assetfellmore than 8 percent:

Once again the inexorablecurrency of the future, boundby no governmental authority and subject only to the immutable Code, is doing a fine impression oftulip mania. Were happy to watch.

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Looks Like We're Going To Have To Talk About Bitcoin Again - Dealbreaker

Forbes

Bitcoin's Volatile Trading In Asia Tells Us A Lot About Local Banking Systems Forbes As Bitcoin gains significant traction in Japan and Korea and its price once again rallies to new highs, the currency is revealing some friction in Asia's banking systems not easily visible to outsiders before. As the price of a Bitcoin has, on average ...

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Bitcoin's Volatile Trading In Asia Tells Us A Lot About Local Banking Systems - Forbes