Topic: BITCOIN NEWS EVRYDAY! From multiple sources. (Read 51272 times)
Can that promoting post above be deleted or moved into separate thread? The post spoils this thread's purpose in my opinion
I have found a really safe application. It calls Socratus. It is a insurance ecosystem which provide a digital platform for insurance companies . So any insurance company can connect the platform to become the part of Insurance Digital Ecosystem such as property, flight delay, cyber insurance and etc. Their main aim is to help insurance companies to reduce costs (it can be reduced from 15 to 25 %) and get their business on new level. Also, they powered by Smart-contracts & Socratus Oracles.It means that there is no more solo human decisions to pay or not to pay, no more lingering manual claims handling procedures. From my point of view, it is innovative and fit the market.
It all depends how you manages the thread, because there is no shortage of news on this forum but arranging all those into one good thread will be a huge task, thats why a blog is more useful for that .
In my perspective the best source of information would rather be the social media platforms, yes people may argue that information provided is tamperd with a lot but it is also important to know which information you are following, if you are following a page that has a huge fan following or rather a page followed by a good investor then don't worry.
Thanks 
Hi Micro
Can you please refrain from copy and pasting full articles from CoinDesk.
By all means post a summary and link to the original source.
Many thanks
Keith
Can you please refrain from copy and pasting full articles from CoinDesk.
By all means post a summary and link to the original source.
Many thanks
Keith
I closed this thread anyways . Will not post any more news.
Hi Micro
Can you please refrain from copy and pasting full articles from CoinDesk.
By all means post a summary and link to the original source.
Many thanks
Keith
Can you please refrain from copy and pasting full articles from CoinDesk.
By all means post a summary and link to the original source.
Many thanks
Keith
Deposit Freeze at Chinese Exchanges Drives Bitcoin Price Below $400
Stan Higgins | Published on April 10, 2014 at 23:35 BST | Asia, Exchanges, News, Prices
The price of bitcoin on the CoinDesk USD Bitcoin Price Index (BPI) fell below $400 for the first time since November 2013 on 10th April, as major China-based bitcoin exchanges began reporting that they had received notice that their bank accounts would be shut down by banking partners.
The initial drop occurred following an announcement from Chinese exchange BTCTrade.com, which was then corroborated by similar statements from Huobi and BTC100.org.
china, price, ban
The price of bitcoin has fallen rapidly in recent weeks, after rumors surfaced on 27th March that suggested the PBOC, China’s central bank, would be looking to more tightly enforce restrictions it passed in December meant to ensure a separation between its nationalized banking system and the nascent digital currency industry.
Though no official announcement of the new policy has been made, the statements from major exchanges suggest that the rumored 15th April deadline for the enforcement of this stricter rule interpretation is being enforced.
USD markets plunge 13%
As illustrated by the USD BPI, the sell-off began at approximately 1:00 UTC on 10th April.
The price fell from $440 to $410 within a few hours of BTCTrade.com’s initial announcement, before fluctuating between $407 and $412.
At 15:00 UTC, the price began to fall precipitously, tumbling from $406 to $389 by 15:15 UTC. Two hours later the price briefly climbed above $400 before sliding into the $390 range.
At press time, the price of 1 BTC on the USD BPI was $381.
CNY markets down 11.4%
Chinese markets reacted quickly to the news from domestic exchanges.
According to the CoinDesk CNY BPI, the price slipped from ¥2,726 to ¥2,490 within five hours of the announcement.
Screen Shot 2014-04-10 at 6.24.31 PM
After reaching a then-low of ¥2,248, the price fluctuated over the next 10 hours, peaking at ¥2,531 at 8:30 UTC. The price began to fall at approximately 14:30 UTC, slipping from ¥2,508 to ¥2,424 over the next 45 minutes.
At press time, the price of one bitcoin on the CNY BPI was ¥2425.
Stan Higgins | Published on April 10, 2014 at 23:35 BST | Asia, Exchanges, News, Prices
The price of bitcoin on the CoinDesk USD Bitcoin Price Index (BPI) fell below $400 for the first time since November 2013 on 10th April, as major China-based bitcoin exchanges began reporting that they had received notice that their bank accounts would be shut down by banking partners.
The initial drop occurred following an announcement from Chinese exchange BTCTrade.com, which was then corroborated by similar statements from Huobi and BTC100.org.
china, price, ban
The price of bitcoin has fallen rapidly in recent weeks, after rumors surfaced on 27th March that suggested the PBOC, China’s central bank, would be looking to more tightly enforce restrictions it passed in December meant to ensure a separation between its nationalized banking system and the nascent digital currency industry.
Though no official announcement of the new policy has been made, the statements from major exchanges suggest that the rumored 15th April deadline for the enforcement of this stricter rule interpretation is being enforced.
USD markets plunge 13%
As illustrated by the USD BPI, the sell-off began at approximately 1:00 UTC on 10th April.
The price fell from $440 to $410 within a few hours of BTCTrade.com’s initial announcement, before fluctuating between $407 and $412.
At 15:00 UTC, the price began to fall precipitously, tumbling from $406 to $389 by 15:15 UTC. Two hours later the price briefly climbed above $400 before sliding into the $390 range.
At press time, the price of 1 BTC on the USD BPI was $381.
CNY markets down 11.4%
Chinese markets reacted quickly to the news from domestic exchanges.
According to the CoinDesk CNY BPI, the price slipped from ¥2,726 to ¥2,490 within five hours of the announcement.
Screen Shot 2014-04-10 at 6.24.31 PM
After reaching a then-low of ¥2,248, the price fluctuated over the next 10 hours, peaking at ¥2,531 at 8:30 UTC. The price began to fall at approximately 14:30 UTC, slipping from ¥2,508 to ¥2,424 over the next 45 minutes.
At press time, the price of one bitcoin on the CNY BPI was ¥2425.
Investor Group Offers to Buy Mt. Gox for One Bitcoin
Stan Higgins | Published on April 10, 2014 at 22:55 BST | Exchanges, Mt. Gox, News
A group of investors has offered to buy bankrupt Japan-based bitcoin exchange Mt. Gox, as part of a bid that will require the approval of its Japanese bankruptcy court.
The investors are offering to pay 1 BTC for the troubled exchange, an amount which, at press time was worth $383, according to the CoinDesk Bitcoin Price Index (USD BPI).
The Wall Street Journal reported that the investor group would assume all of Mt. Gox’s liabilities and obligations.
In documents submitted to the Japanese bankruptcy court, the group reportedly outlined plans to resuscitate Mt. Gox, which included proposals for customers who hold outstanding claims against the exchange.
Jumpstarting Mt. Gox
The single-bitcoin valuation is based on the premise that the true value of Mt. Gox is difficult to determine.
Wrote the Journal:
“According to people familiar with the plan, the group is justifying the low price because of the ‘information vacuum’ over Mt. Gox’s 550,000 missing bitcoins, currently worth about $220 million. It isn’t possible to place a value on the lost coins, they said.”
Creditors will have two options. They can either receive a prorated amount from the 200,000 bitcoins recovered by Mt. Gox equal to roughly 20 percent of their claim, or obtain an equity stake of that amount in the revitalized Mt. Gox exchange.
The investor group pledged to set aside 50% of transaction fees to pay back creditors over time.
Diverse group seeks ownership
The investor group behind the bid includes venture capitalist Brock Pierce, founder of a number of bitcoin-related businesses including KnCMiner and GoCoin, and the creator of a prominent bitcoin syndicate.
Other members of the group include John Betts, a former Morgan Stanley and Goldamn Sachs executive who would serve as the new Mt. Gox CEO, and William Quigley, managing director for Clearstone Venture Partners, a VC fund based in Santa Monica, California.
Thread sponsored by : www.bitcoinlottery.co.nf
Stan Higgins | Published on April 10, 2014 at 22:55 BST | Exchanges, Mt. Gox, News
A group of investors has offered to buy bankrupt Japan-based bitcoin exchange Mt. Gox, as part of a bid that will require the approval of its Japanese bankruptcy court.
The investors are offering to pay 1 BTC for the troubled exchange, an amount which, at press time was worth $383, according to the CoinDesk Bitcoin Price Index (USD BPI).
The Wall Street Journal reported that the investor group would assume all of Mt. Gox’s liabilities and obligations.
In documents submitted to the Japanese bankruptcy court, the group reportedly outlined plans to resuscitate Mt. Gox, which included proposals for customers who hold outstanding claims against the exchange.
Jumpstarting Mt. Gox
The single-bitcoin valuation is based on the premise that the true value of Mt. Gox is difficult to determine.
Wrote the Journal:
“According to people familiar with the plan, the group is justifying the low price because of the ‘information vacuum’ over Mt. Gox’s 550,000 missing bitcoins, currently worth about $220 million. It isn’t possible to place a value on the lost coins, they said.”
Creditors will have two options. They can either receive a prorated amount from the 200,000 bitcoins recovered by Mt. Gox equal to roughly 20 percent of their claim, or obtain an equity stake of that amount in the revitalized Mt. Gox exchange.
The investor group pledged to set aside 50% of transaction fees to pay back creditors over time.
Diverse group seeks ownership
The investor group behind the bid includes venture capitalist Brock Pierce, founder of a number of bitcoin-related businesses including KnCMiner and GoCoin, and the creator of a prominent bitcoin syndicate.
Other members of the group include John Betts, a former Morgan Stanley and Goldamn Sachs executive who would serve as the new Mt. Gox CEO, and William Quigley, managing director for Clearstone Venture Partners, a VC fund based in Santa Monica, California.
Thread sponsored by : www.bitcoinlottery.co.nf
Bitcoin Core Developers Weigh in on Side Chain Proposal
Danny Bradbury (@dannybradbury) | Published on April 10, 2014 at 20:31 BST | Bitcoin protocol, News, Startups, Technology
These days, everyone wants to add new features to the bitcoin block chain, but now one team thinks that it’s found a way to do it responsibly – by creating “side chains” that can interact with bitcoin.
The process, known as ‘two-way pegging’, has some hefty backing. It is supported by Adam Back, the developer of the HashCash, the algorithm bitcoin uses to generate and verify currency.
On the business side, it has Austin Hill, a Canadian entrepreneur and angel investor who in 1997 founded Zero-Knowledge Systems, an anonymous networking and privacy technology company. Hill, who raised more than $80m for the endeavor, likes to say it was Tor, before Tor was invented.
Block chain 2.0
Clearly, the money and the technical know-how are there. So, how will it work?
“Once adopted, people could try out speculative and innovative changes, while enjoying the network effect of bitcoin's substantial adoption.”
There have been two different approaches to expanding bitcoin’s functionality in the past. One has been to introduce new features that piggyback on it, using the bitcoin block chain’s existing resources. Counterparty is one example of this, and Mastercoin is another.
The other is to just create whole new frameworks for next-generation cryptocurrencies outside of bitcoin. Examples of these are NXT and the still-unlaunched Ethereum proposal.
The problem with completely separate altcoins and frameworks, says Hill, is that they they are not interoperable. They create new “races for scarcity”, with each one representing a new asset in short supply.
But, there are several problems with bitcoin, too, says Hill, which is why exchanges like Coinbase generally run their own transactions outside the block chain.
Hill told CoinDesk: “There is a practical reason why some of those things can’t operate on the block chain, and that’s because at peak, they’re doing more transactions than bitcoin can support right now.”
Instead, Back and Hill want to ‘shard’ the block chain, creating another block chain, which has a two-way relationship with bitcoin’s own.
This will have two major benefits, Hill suggests: functionality, and scalability.
“We could have US and Canadian dollars, smart derivatives, option shares, and future contracts. A whole series of programmable trust instruments. A lot of people had talked about these things, and how the block chain could be adapted for this, but I hadn’t seen anyone lay out how it would come to pass.”
And secondly: “By sharding, you can have orders of magnitude faster transaction processing and you can start to scale bitcoin.”
Two-way pegging
In October, Back had proposed a concept called one-way pegging, in which bitcoins could be ‘moved’ from the bitcoin block chain to another block chain called a side chain, that was merge-mined with bitcoin. Bitcoins would be marked in the bitcoin block chain as having been transferred. Another coin in the new block chain would be marked as a representation of the transferred bitcoin.
Then last year, bitcoin core developer Greg Maxwell figured out a method for two-way pegging, in which bitcoins could be moved back and forth between the side chain and the block chain.
This would allow them to be transferred at will, so that the bitcoin network wouldn’t lose its bitcoins forever when they were transferred, but could get them back if the owner decided to transfer them back into the bitcoin block chain.
Bitcoin would be ‘firewalled’ from the side chain, meaning that any security issues that arose in a side chain wouldn’t affect people who were only involved in the bitcoin block chain.
This opens up some interesting possibilities, says Back:
“You can have multiple competing side chains that compete at the bitcoin level. Perhaps one that’s optimised for micropayments. You could move bitcoins into the micropayments sidechain, and then back again and then into the smart contract sidechain.”
The advantage here is that, unlike altcoins, they would all be interoperable, with the bitcoin block chain (or, as he calls it, the “main chain”, used as a common point of transfer.
Throughput
So, that takes care of functionality. But what about throughput? The current transaction rate on the bitcoin network is relatively low, at something under seven-to-nine transactions per second, which is why all of those off-chain transactions happen, in exchanges and elsewhere.
The downside of that is that they become difficult (but not impossible) to audit in any publicly visible way.
Says Hill: “You are still having to extend and move your coins off the block chain into a trust me security model. That has led to huge amounts of theft.”
So, that’s the proposal. What do core developers think?
“In particular the notion that a different chain might be designed to natively support things like smart contracts is funny, given that Bitcoin already supports them,” argues Mike Hearn, the brains behind BitcoinJ, and a core developer since bitcoin began (he spoke about them as early as 2012, arguing that all the pieces of the puzzle were in place).
The recent introduction of 40 extra bytes into bitcoin transactions for arbitrary messages (such as those associated with smart property or smart contracts) supports that view, although third parties have asked for more space.
Hearn also doesn’t think that alternative side chains can solve the scalability problem, which in any case is solvable purely within the bitcoin network, he argues.
“It’s not as if there’s some impossible limit beyond which Bitcoin can’t go,” he protests, pointing to the Bitcoin Wiki’s scalability page, which breaks down how much further we can push the network.
“With some fairly straightforward software improvements, bitcoin should be able to handle tens of thousands of transactions per second or more. To quote Satoshi, ‘it never really hits a scale ceiling’,” he says.
Gregory Maxwell, who first proposed two-way pegging, says that it could provide some relief for bitcoin, though:
“I don’t think this will remove the need to increase bitcoin’s throughput entirely, but if the technology matures fast enough it may allow for a more conservative approach that increases size only when its very clearly safe to do so.”
Bitcoin core developer Jeff Garzik argues that off-chain transactions are an enabler, not a problem.
“In the real world, millions of USD transactions happen every day that are not directly or immediately reported to a bank or governmental authority.”
Garzik describes himself as a fan of off-chain transactions and points to his own side project, payment channels, as an example of setting up high-volume transactions with other systems outside the bitcoin network.
Approval
So, some experts believe that two-way pegging could provide some useful respite for bitcoin from a scalability perspective, if side chains were able to connect with audit-able, fraud-proof private chains designed for high throughput. Those side chains could also be many and varied, each designed with their own specific properties for tasks like microtransactions and derivatives, say.
But, for two-way pegging to work, changes have to be made to the Bitcoin protocol. Will Back and Hill’s venture be accepted by the bitcoin open source community?
Said Garzik:
“One thing open source developers try to avoid is pre-approval based on some future supposition. We have no idea what the future will bring, any more than anyone else.
Once a concrete proposal appears in a pull request, then we can give a reasonable comment based on engineering evaluation.”
If the changes necessary to allow bitcoin to talk to other side chains are made, then it could relieve the bitcoin developer community of requests to tweak the blockchain to suit third-party purposes.
Maxwell calls it the one change to rule them all.
“Once adopted, people could try out speculative and innovative changes, while enjoying the network effect of bitcoin’s substantial adoption, without having to go ask anyone— not developers, not the community— for permission.”
Hill and Back, who claim to have some core developers supporting their venture, plan to announce the full details – and its official name – by mid-May.
Thread sponsored by: www.bitcoinlottery.co.nf
Danny Bradbury (@dannybradbury) | Published on April 10, 2014 at 20:31 BST | Bitcoin protocol, News, Startups, Technology
These days, everyone wants to add new features to the bitcoin block chain, but now one team thinks that it’s found a way to do it responsibly – by creating “side chains” that can interact with bitcoin.
The process, known as ‘two-way pegging’, has some hefty backing. It is supported by Adam Back, the developer of the HashCash, the algorithm bitcoin uses to generate and verify currency.
On the business side, it has Austin Hill, a Canadian entrepreneur and angel investor who in 1997 founded Zero-Knowledge Systems, an anonymous networking and privacy technology company. Hill, who raised more than $80m for the endeavor, likes to say it was Tor, before Tor was invented.
Block chain 2.0
Clearly, the money and the technical know-how are there. So, how will it work?
“Once adopted, people could try out speculative and innovative changes, while enjoying the network effect of bitcoin's substantial adoption.”
There have been two different approaches to expanding bitcoin’s functionality in the past. One has been to introduce new features that piggyback on it, using the bitcoin block chain’s existing resources. Counterparty is one example of this, and Mastercoin is another.
The other is to just create whole new frameworks for next-generation cryptocurrencies outside of bitcoin. Examples of these are NXT and the still-unlaunched Ethereum proposal.
The problem with completely separate altcoins and frameworks, says Hill, is that they they are not interoperable. They create new “races for scarcity”, with each one representing a new asset in short supply.
But, there are several problems with bitcoin, too, says Hill, which is why exchanges like Coinbase generally run their own transactions outside the block chain.
Hill told CoinDesk: “There is a practical reason why some of those things can’t operate on the block chain, and that’s because at peak, they’re doing more transactions than bitcoin can support right now.”
Instead, Back and Hill want to ‘shard’ the block chain, creating another block chain, which has a two-way relationship with bitcoin’s own.
This will have two major benefits, Hill suggests: functionality, and scalability.
“We could have US and Canadian dollars, smart derivatives, option shares, and future contracts. A whole series of programmable trust instruments. A lot of people had talked about these things, and how the block chain could be adapted for this, but I hadn’t seen anyone lay out how it would come to pass.”
And secondly: “By sharding, you can have orders of magnitude faster transaction processing and you can start to scale bitcoin.”
Two-way pegging
In October, Back had proposed a concept called one-way pegging, in which bitcoins could be ‘moved’ from the bitcoin block chain to another block chain called a side chain, that was merge-mined with bitcoin. Bitcoins would be marked in the bitcoin block chain as having been transferred. Another coin in the new block chain would be marked as a representation of the transferred bitcoin.
Then last year, bitcoin core developer Greg Maxwell figured out a method for two-way pegging, in which bitcoins could be moved back and forth between the side chain and the block chain.
This would allow them to be transferred at will, so that the bitcoin network wouldn’t lose its bitcoins forever when they were transferred, but could get them back if the owner decided to transfer them back into the bitcoin block chain.
Bitcoin would be ‘firewalled’ from the side chain, meaning that any security issues that arose in a side chain wouldn’t affect people who were only involved in the bitcoin block chain.
This opens up some interesting possibilities, says Back:
“You can have multiple competing side chains that compete at the bitcoin level. Perhaps one that’s optimised for micropayments. You could move bitcoins into the micropayments sidechain, and then back again and then into the smart contract sidechain.”
The advantage here is that, unlike altcoins, they would all be interoperable, with the bitcoin block chain (or, as he calls it, the “main chain”, used as a common point of transfer.
Throughput
So, that takes care of functionality. But what about throughput? The current transaction rate on the bitcoin network is relatively low, at something under seven-to-nine transactions per second, which is why all of those off-chain transactions happen, in exchanges and elsewhere.
The downside of that is that they become difficult (but not impossible) to audit in any publicly visible way.
Says Hill: “You are still having to extend and move your coins off the block chain into a trust me security model. That has led to huge amounts of theft.”
So, that’s the proposal. What do core developers think?
“In particular the notion that a different chain might be designed to natively support things like smart contracts is funny, given that Bitcoin already supports them,” argues Mike Hearn, the brains behind BitcoinJ, and a core developer since bitcoin began (he spoke about them as early as 2012, arguing that all the pieces of the puzzle were in place).
The recent introduction of 40 extra bytes into bitcoin transactions for arbitrary messages (such as those associated with smart property or smart contracts) supports that view, although third parties have asked for more space.
Hearn also doesn’t think that alternative side chains can solve the scalability problem, which in any case is solvable purely within the bitcoin network, he argues.
“It’s not as if there’s some impossible limit beyond which Bitcoin can’t go,” he protests, pointing to the Bitcoin Wiki’s scalability page, which breaks down how much further we can push the network.
“With some fairly straightforward software improvements, bitcoin should be able to handle tens of thousands of transactions per second or more. To quote Satoshi, ‘it never really hits a scale ceiling’,” he says.
Gregory Maxwell, who first proposed two-way pegging, says that it could provide some relief for bitcoin, though:
“I don’t think this will remove the need to increase bitcoin’s throughput entirely, but if the technology matures fast enough it may allow for a more conservative approach that increases size only when its very clearly safe to do so.”
Bitcoin core developer Jeff Garzik argues that off-chain transactions are an enabler, not a problem.
“In the real world, millions of USD transactions happen every day that are not directly or immediately reported to a bank or governmental authority.”
Garzik describes himself as a fan of off-chain transactions and points to his own side project, payment channels, as an example of setting up high-volume transactions with other systems outside the bitcoin network.
Approval
So, some experts believe that two-way pegging could provide some useful respite for bitcoin from a scalability perspective, if side chains were able to connect with audit-able, fraud-proof private chains designed for high throughput. Those side chains could also be many and varied, each designed with their own specific properties for tasks like microtransactions and derivatives, say.
But, for two-way pegging to work, changes have to be made to the Bitcoin protocol. Will Back and Hill’s venture be accepted by the bitcoin open source community?
Said Garzik:
“One thing open source developers try to avoid is pre-approval based on some future supposition. We have no idea what the future will bring, any more than anyone else.
Once a concrete proposal appears in a pull request, then we can give a reasonable comment based on engineering evaluation.”
If the changes necessary to allow bitcoin to talk to other side chains are made, then it could relieve the bitcoin developer community of requests to tweak the blockchain to suit third-party purposes.
Maxwell calls it the one change to rule them all.
“Once adopted, people could try out speculative and innovative changes, while enjoying the network effect of bitcoin’s substantial adoption, without having to go ask anyone— not developers, not the community— for permission.”
Hill and Back, who claim to have some core developers supporting their venture, plan to announce the full details – and its official name – by mid-May.
Thread sponsored by: www.bitcoinlottery.co.nf
Study: Nearly 6 Million Bitcoin Wallets Attacked in 2013
Stan Higgins | Published on April 10, 2014 at 19:50 BST | Crime, Mining, News, Technology
Nearly 6 million malware attacks were launched against bitcoin wallet users in 2013, according to a new report released by cybersecurity firm Kapersky Labs.
Entitled “Financial Cyberthreats in 2013″, Kapersky’s report looked more broadly at a range of cyberattacks – from phishing to mobile malware, but put a special emphasis on examining how digital currency wallet users are being targeted by criminals online.
Perhaps most notably, Kapersky found that 1 million wallet owners fell victim to a malware attack in 2013, up from less than 600,000 in 2012. Attacks on digital currency wallets constituted roughly 20% of all attacks that involved financial malware last year.
Read the report:
“Among all finance-related malware, tools associated with bitcoin demonstrated the most dynamic development.”
The full, 35-page report provided additional information on malware that targets wallet data, as well as programs that secretly upload mining software to the victim’s computer.
The report draws on information collected from Kapersky’s global security infrastructure.
Attack figures rise with bitcoin’s price
The number of wallet attacks in 2013 rose significantly compared to 2012 levels, when according to Kapersky, less than 2 million such attacks were detected. This figure includes all observed attacks, including those that were not successful.
Kapersky reported a more modest increase in the amount of malware attacks that uploaded mining software to affected computers, rising from roughly 500,000 in 2012 to more than 2 million in 2013.
Almost 800,000 users suffered a mining software-related attack in 2013, compared to less than 200,000 the year before. Overall, mining attacks accounted for 8.9% of all attacks.
The report noted that beginning in October 2013, the number of detected mining malware attacks fell while the number of wallet-targeting programs started to climb. It said:
“This could be the result of the above-mentioned idiosyncrasy of the Bitcoin system, where the more ‘coins’ that are generated, the more difficult it is to generate new ones. This could also drive malicious users to focus on searching for and stealing bitcoin wallets holding already-generated cryptocurrency.”
Attacks on wallets began to rise sharply in September 2012, according to the data. During 2013, the number of attacks peaked in August 2013, with additional periods of heightened activity during April and November-December of that year.
This finding suggests that the number of attacks increased with the price of bitcoin, as prices hit new highs during both these periods.
Malware’s growing threat
Malware that targets both wallets and home computers used by miners poses an increasingly serious threat to the digital currency ecosystem.
Earlier this year, Dell SecureWorks identified 146 types of bitcoin malware currenty circulating on the internet. Due to the risk, some have turned to paper wallets as a way to securely store their bitcoins.
Two apps previously available on Google Play were identified by a cybersecurity team which turned affected Android devices into litecoin and dogecoin miners. Further, in late March, Symantec noted an increase in the number of mining malware attacks which targeted Linux-based computers.
Stan Higgins | Published on April 10, 2014 at 19:50 BST | Crime, Mining, News, Technology
Nearly 6 million malware attacks were launched against bitcoin wallet users in 2013, according to a new report released by cybersecurity firm Kapersky Labs.
Entitled “Financial Cyberthreats in 2013″, Kapersky’s report looked more broadly at a range of cyberattacks – from phishing to mobile malware, but put a special emphasis on examining how digital currency wallet users are being targeted by criminals online.
Perhaps most notably, Kapersky found that 1 million wallet owners fell victim to a malware attack in 2013, up from less than 600,000 in 2012. Attacks on digital currency wallets constituted roughly 20% of all attacks that involved financial malware last year.
Read the report:
“Among all finance-related malware, tools associated with bitcoin demonstrated the most dynamic development.”
The full, 35-page report provided additional information on malware that targets wallet data, as well as programs that secretly upload mining software to the victim’s computer.
The report draws on information collected from Kapersky’s global security infrastructure.
Attack figures rise with bitcoin’s price
The number of wallet attacks in 2013 rose significantly compared to 2012 levels, when according to Kapersky, less than 2 million such attacks were detected. This figure includes all observed attacks, including those that were not successful.
Kapersky reported a more modest increase in the amount of malware attacks that uploaded mining software to affected computers, rising from roughly 500,000 in 2012 to more than 2 million in 2013.
Almost 800,000 users suffered a mining software-related attack in 2013, compared to less than 200,000 the year before. Overall, mining attacks accounted for 8.9% of all attacks.
The report noted that beginning in October 2013, the number of detected mining malware attacks fell while the number of wallet-targeting programs started to climb. It said:
“This could be the result of the above-mentioned idiosyncrasy of the Bitcoin system, where the more ‘coins’ that are generated, the more difficult it is to generate new ones. This could also drive malicious users to focus on searching for and stealing bitcoin wallets holding already-generated cryptocurrency.”
Attacks on wallets began to rise sharply in September 2012, according to the data. During 2013, the number of attacks peaked in August 2013, with additional periods of heightened activity during April and November-December of that year.
This finding suggests that the number of attacks increased with the price of bitcoin, as prices hit new highs during both these periods.
Malware’s growing threat
Malware that targets both wallets and home computers used by miners poses an increasingly serious threat to the digital currency ecosystem.
Earlier this year, Dell SecureWorks identified 146 types of bitcoin malware currenty circulating on the internet. Due to the risk, some have turned to paper wallets as a way to securely store their bitcoins.
Two apps previously available on Google Play were identified by a cybersecurity team which turned affected Android devices into litecoin and dogecoin miners. Further, in late March, Symantec noted an increase in the number of mining malware attacks which targeted Linux-based computers.
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Legg Mason’s Bill Miller: Buffett is Wrong on Bitcoin
Pete Rizzo (@pete_rizzo_) | Published on April 10, 2014 at 15:32 BST | News, Prices, Technology
In an interview on CNBC’s popular morning program ‘Squawk Box’, Legg Mason’s Bill Miller dismissed Warren Buffett’s statements on bitcoin as flawed.
The former Legg Mason CFA, chairman and CIO, and current portfolio manager for the Legg Mason Capital Management Trust reiterated his support for bitcoin, directly addressing the legendary investor’s opinions on the subject in the process.
Buffett has been outspoken in his views about bitcoin as an investment, calling its value a ‘mirage’ and urging investors to ‘stay away‘ from the digital currency, though his statements have suggested he sees value in bitcoin’s underlying technology.
In contrast, Miller has been open about owning bitcoin and what he sees as its potential to maintain and grow its value long-term.
Overall, Miller was respectful when disagreeing with Buffett, though he suggested that the investor’s thinking on the matter was misguided, stating:
“I have enormous regard for Warren, but I think there’s a logical flaw in his thinking here. It may very well be the case that bitcoin is worth nothing, but I think it’s a really interesting intellectual and technological experiment.”
Miller’s support is also notable considering that he has actually lost money investing in bitcoin, as he reported that his BTC holdings have declined 20% to date.
Bitcoin is not a check
In his 14th March interview on CNBC, Buffett compared bitcoin to checks or money orders, arguing that since its primary value was as a payment system, the idea that it could be a worthwhile investment was incorrect.
However, notably, Miller took direct aim at these statements on CNBC:
“[Checks] have no value because they are infinitely creatable. There are 12m bitcoins out there and there will [only ever] be 21m. If there were 21m checks in the world and that was all there were, and all transactions went through checks, checks would be very, very valuable.”
Still, Miller agreed with Buffett on his point that the main benefit of bitcoin was its use as a payment system.
“I think he had it exactly right in that its main value, potentially, is as a payment system. [It's] potentially disruptive as you can send it anonymously, you can send it without paying the interchange fees and that kind of thing.”
Bitcoin will be the lasting digital currency
Miller also weighed in on the subject of whether bitcoin could face competition from any of its available alternatives, citing the popular theory of path dependance, which attempts to explain why the first-to-market solution is often the one that becomes most widely used.
Miller listed historical examples of this phenomenon, noting that the most efficient or best ideas don’t always win out. Specifically, he cited the fact that “beta was better than VHS”, and that “the QWERTY keyboard was not the most efficient way to type”.
Explained Miller:
“Once you reach a certain state, it becomes very difficult to dislodge that. I think bitcoin has probably won that, less so cryptocurrencies.”
Miller also weighed in on why bitcoin is a preferable investment to gold.
About Miller
Miller has achieved notable successes during his lengthy career at Legg Mason, most recently when overseeing the Legg Mason Opportunity Trust, a fund that focuses on assets with large gaps between price and intrinsic value.
In 2013, the fund was number one in The Wall Street Journal‘s ranking of diversified US-stock mutual funds with more than $50m in assets for three straight quarters, according to MarketWatch.
Historically, Miller’s track record has also been impressive. From 1991 to 2005, the Legg Mason Capital Management Value Trust, which Miller co-managed, achieved the unlikely feat of beating the S&P 500 Index for 15 straight years.
Pete Rizzo (@pete_rizzo_) | Published on April 10, 2014 at 15:32 BST | News, Prices, Technology
In an interview on CNBC’s popular morning program ‘Squawk Box’, Legg Mason’s Bill Miller dismissed Warren Buffett’s statements on bitcoin as flawed.
The former Legg Mason CFA, chairman and CIO, and current portfolio manager for the Legg Mason Capital Management Trust reiterated his support for bitcoin, directly addressing the legendary investor’s opinions on the subject in the process.
Buffett has been outspoken in his views about bitcoin as an investment, calling its value a ‘mirage’ and urging investors to ‘stay away‘ from the digital currency, though his statements have suggested he sees value in bitcoin’s underlying technology.
In contrast, Miller has been open about owning bitcoin and what he sees as its potential to maintain and grow its value long-term.
Overall, Miller was respectful when disagreeing with Buffett, though he suggested that the investor’s thinking on the matter was misguided, stating:
“I have enormous regard for Warren, but I think there’s a logical flaw in his thinking here. It may very well be the case that bitcoin is worth nothing, but I think it’s a really interesting intellectual and technological experiment.”
Miller’s support is also notable considering that he has actually lost money investing in bitcoin, as he reported that his BTC holdings have declined 20% to date.
Bitcoin is not a check
In his 14th March interview on CNBC, Buffett compared bitcoin to checks or money orders, arguing that since its primary value was as a payment system, the idea that it could be a worthwhile investment was incorrect.
However, notably, Miller took direct aim at these statements on CNBC:
“[Checks] have no value because they are infinitely creatable. There are 12m bitcoins out there and there will [only ever] be 21m. If there were 21m checks in the world and that was all there were, and all transactions went through checks, checks would be very, very valuable.”
Still, Miller agreed with Buffett on his point that the main benefit of bitcoin was its use as a payment system.
“I think he had it exactly right in that its main value, potentially, is as a payment system. [It's] potentially disruptive as you can send it anonymously, you can send it without paying the interchange fees and that kind of thing.”
Bitcoin will be the lasting digital currency
Miller also weighed in on the subject of whether bitcoin could face competition from any of its available alternatives, citing the popular theory of path dependance, which attempts to explain why the first-to-market solution is often the one that becomes most widely used.
Miller listed historical examples of this phenomenon, noting that the most efficient or best ideas don’t always win out. Specifically, he cited the fact that “beta was better than VHS”, and that “the QWERTY keyboard was not the most efficient way to type”.
Explained Miller:
“Once you reach a certain state, it becomes very difficult to dislodge that. I think bitcoin has probably won that, less so cryptocurrencies.”
Miller also weighed in on why bitcoin is a preferable investment to gold.
About Miller
Miller has achieved notable successes during his lengthy career at Legg Mason, most recently when overseeing the Legg Mason Opportunity Trust, a fund that focuses on assets with large gaps between price and intrinsic value.
In 2013, the fund was number one in The Wall Street Journal‘s ranking of diversified US-stock mutual funds with more than $50m in assets for three straight quarters, according to MarketWatch.
Historically, Miller’s track record has also been impressive. From 1991 to 2005, the Legg Mason Capital Management Value Trust, which Miller co-managed, achieved the unlikely feat of beating the S&P 500 Index for 15 straight years.
Lawyers Want Bitcoin Money Laundering Charges Dropped on Technicality
Nermin Hajdarbegovic | Published on April 10, 2014 at 14:12 BST | Crime, News, Regulation, US & Canada
Lawyers representing two Florida men charged with bitcoin-related money laundering want to have the charges dropped on a curious technicality.
Adber Espinoza and Pascal Reid were arrested in February following an undercover sting operation. Police made the arrests after undercover officers took to LocalBitcoins.com posing as credit card fraudsters.
Officers were looking for someone to launder their cash and buy bitcoins needed to fund illegal activities, namely to buy stolen credit card data. Having allegedly agreed, Reid and Espinoza both stand accused of laundering money and running an unregistered money service.
Can’t launder without money
The Internal Revenue Service recently classified bitcoin as property rather than currency. Even before the IRS statement bitcoin was not considered money, at least not in the eyes of the law.
Lawyers representing Reid and Espinoza figured out a way of using this technicality to their advantage. The suspects pleaded not guilty and their defence is now looking to have the charges dropped, since bitcoins are not defined as money, hence money laundering legislation should not apply to them.
However, Miami-Dade County prosecutors disagree. The prosecution insists money laundering charges can stick and it believes they fit the alleged crime, Fox News reports.
Legal precedent?
According to IRS bitcoin guidance, issued on 25th March, digital currencies will be treated as property rather than currency. However, the IRS guidance only applies to federal taxes – bitcoin and other digital currencies are treated as property for US federal tax purposes, but general rules for property transactions still apply.
Miami-Dade State Attorney Katherine Fernandez Rundle says this is the first time any state decided to bring money laundering charges in a case involving bitcoin.
Earlier this month a similar case was made by Joshua Dratel, Ross Ulbricht’s defence lawyer. Ulbricht is of course facing serious charges stemming from his association with online drugs bazaar Silk Road.
Dratel argues that at least one count of money laundering against Ulbricht should be dismissed, citing FinCEN and IRS guidance as proof of his argument. However, the case against Ulbricht to that involving Reid and Espinoza – as they allegedly accepted cash for their services, while Ulbricht stands accused of dealing solely in bitcoin.
Nermin Hajdarbegovic | Published on April 10, 2014 at 14:12 BST | Crime, News, Regulation, US & Canada
Lawyers representing two Florida men charged with bitcoin-related money laundering want to have the charges dropped on a curious technicality.
Adber Espinoza and Pascal Reid were arrested in February following an undercover sting operation. Police made the arrests after undercover officers took to LocalBitcoins.com posing as credit card fraudsters.
Officers were looking for someone to launder their cash and buy bitcoins needed to fund illegal activities, namely to buy stolen credit card data. Having allegedly agreed, Reid and Espinoza both stand accused of laundering money and running an unregistered money service.
Can’t launder without money
The Internal Revenue Service recently classified bitcoin as property rather than currency. Even before the IRS statement bitcoin was not considered money, at least not in the eyes of the law.
Lawyers representing Reid and Espinoza figured out a way of using this technicality to their advantage. The suspects pleaded not guilty and their defence is now looking to have the charges dropped, since bitcoins are not defined as money, hence money laundering legislation should not apply to them.
However, Miami-Dade County prosecutors disagree. The prosecution insists money laundering charges can stick and it believes they fit the alleged crime, Fox News reports.
Legal precedent?
According to IRS bitcoin guidance, issued on 25th March, digital currencies will be treated as property rather than currency. However, the IRS guidance only applies to federal taxes – bitcoin and other digital currencies are treated as property for US federal tax purposes, but general rules for property transactions still apply.
Miami-Dade State Attorney Katherine Fernandez Rundle says this is the first time any state decided to bring money laundering charges in a case involving bitcoin.
Earlier this month a similar case was made by Joshua Dratel, Ross Ulbricht’s defence lawyer. Ulbricht is of course facing serious charges stemming from his association with online drugs bazaar Silk Road.
Dratel argues that at least one count of money laundering against Ulbricht should be dismissed, citing FinCEN and IRS guidance as proof of his argument. However, the case against Ulbricht to that involving Reid and Espinoza – as they allegedly accepted cash for their services, while Ulbricht stands accused of dealing solely in bitcoin.
KnCMiner Offers New Incentives for Neptune Mining Rig Delays
Stan Higgins | Published on April 10, 2014 at 00:02 BST | KnCMiner, Mining, News, Technology
Sweden-based digital currency mining hardware developer KnCMiner has announced that customers waiting for their Neptune mining product to ship can opt to receive a modified Jupiter rig instead.
The Neptune sports 3 TH/s of hashing speed and carries a price tag of $9,995. The 20-nm miner is based on the Jupiter design, but consumes 30% less electricity at an estimated rate of 0.7 watts per GH/s.
The announcement, published on the company’s website, offers KnCMiner customers an alternative to waiting for the production of the Neptune line of mining hardware.
Technology swap available
The modified Jupiters, according to KnCMiner, are capable of achieving the same 3 TH/s estimated for the Neptune line. KnCMiner is offering this alternative free of charge and with immediate shipping.
The company outlined the alternative in a statement:
“If more than 400 people want to have the conversion, we will ship in order of payment for the original Neptune order. This offer will be open for seven days for people to contact us.”
After the seven-day period, KnCMiner will close submissions and reach out to those who requested the modified Jupiter unit.
Assuaging customer concerns
KnCMiner has a history of offering alternatives to its customers in the event of a delay of the Neptune line.
Earlier this year, the company released a “Plan B” which enabled customers to receive refunds in US dollars or 3 TH/s worth of mining power hosted at a Sweden-based data center. Last September, KnCMiner announced that Jupiter buyers who faced delays would receive upgraded units that provide additional processing power.
The announcement is notable in light of the frequent delays experienced by consumers who order personal mining equipment. For more on the extent of this industry problem, read our most recent report here.
Stan Higgins | Published on April 10, 2014 at 00:02 BST | KnCMiner, Mining, News, Technology
Sweden-based digital currency mining hardware developer KnCMiner has announced that customers waiting for their Neptune mining product to ship can opt to receive a modified Jupiter rig instead.
The Neptune sports 3 TH/s of hashing speed and carries a price tag of $9,995. The 20-nm miner is based on the Jupiter design, but consumes 30% less electricity at an estimated rate of 0.7 watts per GH/s.
The announcement, published on the company’s website, offers KnCMiner customers an alternative to waiting for the production of the Neptune line of mining hardware.
Technology swap available
The modified Jupiters, according to KnCMiner, are capable of achieving the same 3 TH/s estimated for the Neptune line. KnCMiner is offering this alternative free of charge and with immediate shipping.
The company outlined the alternative in a statement:
“If more than 400 people want to have the conversion, we will ship in order of payment for the original Neptune order. This offer will be open for seven days for people to contact us.”
After the seven-day period, KnCMiner will close submissions and reach out to those who requested the modified Jupiter unit.
Assuaging customer concerns
KnCMiner has a history of offering alternatives to its customers in the event of a delay of the Neptune line.
Earlier this year, the company released a “Plan B” which enabled customers to receive refunds in US dollars or 3 TH/s worth of mining power hosted at a Sweden-based data center. Last September, KnCMiner announced that Jupiter buyers who faced delays would receive upgraded units that provide additional processing power.
The announcement is notable in light of the frequent delays experienced by consumers who order personal mining equipment. For more on the extent of this industry problem, read our most recent report here.
Canadian Senate Meets Bitcoin Community in Fact-Finding Session
Victoria van Eyk (@VictoriavanEyk) | Published on April 10, 2014 at 11:05 BST | Bitcoin ATM, Events, Law, News, Regulation, US & Canada
What is Canada’s place in regulating bitcoin? This is the theme running through the Canadian Senate’s Standing Committee on Banking, Trade and Commerce’s study on the use of digital currency.
The Bitcoin Strategy Group, BitAccess and CAVirtEx sat before the senators on 9th April to demonstrate how bitcoin is purchased and stored. Their representation marks the first presence of bitcoiners in the Senate sphere.
The Canadian Senate has already heard from the Bank of Canada, the Department of Finance, economic historians and other academics. On Thursday, April 10th, the committee will hear directly from the Royal Bank of Canada, the Canadian Bankers’ Association and the Canadian Payments Association.
The mission of this study is to understand virtual currencies. In bitcoin’s case, the question is “How do we treat this? Do we regulate this?”
The panel covered a range of topics, including wallets and bitcoin storage, the three ways of acquiring bitcoin (peer to peer, exchanges and bitcoin ATMs), and allowed for targeted testimony from Canada’s largest virtual exchange – CAVirtEX – and Ottawa-based bitcoin ATM manufacturer BitAccess, who both offered their unique perspective as business owners working daily with bitcoin on the need of government regulation.
Unfortunately, the committee hearing was cut short by a Senate vote. As a result, the first half of the presentation was testimony, followed by a live ATM demonstration.
Christopher Reed, Policy Assistant to Senator Irving Gerstein, the Chair of the Committee, was the first individual to purchase bitcoin from an ATM within session in parliamentary history when he inserted C$100 into the BitAccess machine.
Demonstration session
The Senate is at the beginning of its 18-month long study with the objective of researching and learning about bitcoin. Seeing person-to-person transactions, as demonstrated by Kyle Kemper, a partner at the Bitcoin Strategy Group and Victoria van Eyk, a bitcoin consultant, and an in-person demonstration using the ATM was integral to this understanding as it made bitcoin more ‘tangible’ and accessible.
Victoria van Eyk demonstrates use of a bitcoin ATM to the Senate
Victoria van Eyk demonstrates use of a bitcoin ATM to the Senate
CAVirtEx’s newly hired Advisor, former Ottawa mayor Larry O’Brien, represented the exchange’s view that Canada needs to act on regulation, and fast. Regulating the ‘on and off-ramps’ of bitcoin is required to transform exchanges into serious businesses, with proper checks-and-balances in place to give consumers confidence in transacting with the digital currency.
Due to the last-minute vote, significant content was omitted, however.
““Canada has become one of the leading countries in the world in terms of bitcoin entrepreneurship and innovation.””
The Bitcoin Strategy Group hopes to return in the future to focus on the day-to-day benefits of digital currencies that we can all relate to, including the opportunity for cost savings in the remittance world – where Western Union pocketed $1.1 billion in 2013 for transferring funds, mostly to developing nations – the future of micropayments and ‘social tipping’ for the arts and online content, and the huge benefit for retailers when using bitcoin to transact with.
In a further demonstration, the Group purchased cupcakes from local Ottawa bakery The Flour Shoppe to show the Senate first-hand that local retailers are getting on board with the digital currency, and that it is easily tradeable.
The latter part of the hearing was a robust question and answer period. Many Senators questioned the specific need for regulation.
Senator Paul J. Massicotte questioned the need for bitcoin regulation, asking if it undermined the essence of bitcoin in the first place. Joseph David, CEO of CAVirtEx responded quite quickly, stating that, if Canada hopes to remain in the bitcoin exchange business, banks need to cooperate, and that requires government regulation.
He added:
“Our only other option is going offshore.”
Education and understanding
CAVirtEx’s stance on regulation drew questions from the Senators, who wondered if the very act of regulating undermined bitcoin’s libertarian roots. One senator also brought up the possibility that regulating the currency would add so many costs that the benefits would disappear.
Kyle Kemper called for Canada to “become a global leader on the bitcoin opportunity” and pressed for increased education and understanding before implementing any regulation.
Kemper explained:
“Canada has become one of the leading countries in the world in terms of Bitcoin entrepreneurship and innovation. Before we can come to any conclusions, we must understand what Bitcoin is, how it works, and what the future with Bitcoin may look like.”
Overall, the present Senators had a better-than-average understanding of the currency and the protocol, and were actively engaged throughout the entire presentation. Their questions also touched on HST and taxation concerns, volatility risk with merchant purchases, and bitcoin’s impact on the current Canadian dollar money supply.
Regulation questions
The question from the Senate remains: “What is necessary from us?”
Influential bitcoiners like Andreas Antonopoulos, Chief Security Officer at BlockChain.info, regularly oppose regulation, citing the ability of the community to self-regulate as sufficient for the industry.
Additionally, it was mentioned that there are already regulations in place that keep bitcoin ‘in check’, including FINTRAC – an independence agency that reports to the Ministry of Finance. Many large bitcoin businesses, including panelists CAVirtEx and BitAccess, follow FINTRAC regulations.
However, some senators disagreed with the idea of self-regulation, citing government regulation as “necessary” for bitcoin to succeed. Joseph David requested that bitcoin be considered a foreign currency and regulated in the same way. This comment drew interest from the assembled senators, as it was the first time the idea had been raised.
Regulation is currently a hot topic for bitcoin, as it becomes more mainstream. The recurring theme at the recent Inside Bitcoins New York conference was regulation. Indeed, the US government is also educating themselves on bitcoin: is it a coincidence that a Robocoin ATM was installed and demoed on Capitol Hill on 8th April, while Canada’s Senate were introduced to the local bitcoin ATM on the 9th?
Funnily enough, there was a complete lack of press at the Senate committee hearing tonight, as compared to the overwhelmingly attentive journalists capturing every moment of Congressman Jarod Polis’ purchase of bitcoin on Capitol Hill.
Either way, government is interested. Canada is currently in a unique position to be a leader in the bitcoin space. The country has made it this far without any regulations, however it’s time to be proactive on establishing a policy framework for regulators who are looking for guidance with this sphere.
What happens next is anyone’s guess.
View the full video of the Senate of Canada’s Standing Committee on Banking,
Victoria van Eyk (@VictoriavanEyk) | Published on April 10, 2014 at 11:05 BST | Bitcoin ATM, Events, Law, News, Regulation, US & Canada
What is Canada’s place in regulating bitcoin? This is the theme running through the Canadian Senate’s Standing Committee on Banking, Trade and Commerce’s study on the use of digital currency.
The Bitcoin Strategy Group, BitAccess and CAVirtEx sat before the senators on 9th April to demonstrate how bitcoin is purchased and stored. Their representation marks the first presence of bitcoiners in the Senate sphere.
The Canadian Senate has already heard from the Bank of Canada, the Department of Finance, economic historians and other academics. On Thursday, April 10th, the committee will hear directly from the Royal Bank of Canada, the Canadian Bankers’ Association and the Canadian Payments Association.
The mission of this study is to understand virtual currencies. In bitcoin’s case, the question is “How do we treat this? Do we regulate this?”
The panel covered a range of topics, including wallets and bitcoin storage, the three ways of acquiring bitcoin (peer to peer, exchanges and bitcoin ATMs), and allowed for targeted testimony from Canada’s largest virtual exchange – CAVirtEX – and Ottawa-based bitcoin ATM manufacturer BitAccess, who both offered their unique perspective as business owners working daily with bitcoin on the need of government regulation.
Unfortunately, the committee hearing was cut short by a Senate vote. As a result, the first half of the presentation was testimony, followed by a live ATM demonstration.
Christopher Reed, Policy Assistant to Senator Irving Gerstein, the Chair of the Committee, was the first individual to purchase bitcoin from an ATM within session in parliamentary history when he inserted C$100 into the BitAccess machine.
Demonstration session
The Senate is at the beginning of its 18-month long study with the objective of researching and learning about bitcoin. Seeing person-to-person transactions, as demonstrated by Kyle Kemper, a partner at the Bitcoin Strategy Group and Victoria van Eyk, a bitcoin consultant, and an in-person demonstration using the ATM was integral to this understanding as it made bitcoin more ‘tangible’ and accessible.
Victoria van Eyk demonstrates use of a bitcoin ATM to the Senate
Victoria van Eyk demonstrates use of a bitcoin ATM to the Senate
CAVirtEx’s newly hired Advisor, former Ottawa mayor Larry O’Brien, represented the exchange’s view that Canada needs to act on regulation, and fast. Regulating the ‘on and off-ramps’ of bitcoin is required to transform exchanges into serious businesses, with proper checks-and-balances in place to give consumers confidence in transacting with the digital currency.
Due to the last-minute vote, significant content was omitted, however.
““Canada has become one of the leading countries in the world in terms of bitcoin entrepreneurship and innovation.””
The Bitcoin Strategy Group hopes to return in the future to focus on the day-to-day benefits of digital currencies that we can all relate to, including the opportunity for cost savings in the remittance world – where Western Union pocketed $1.1 billion in 2013 for transferring funds, mostly to developing nations – the future of micropayments and ‘social tipping’ for the arts and online content, and the huge benefit for retailers when using bitcoin to transact with.
In a further demonstration, the Group purchased cupcakes from local Ottawa bakery The Flour Shoppe to show the Senate first-hand that local retailers are getting on board with the digital currency, and that it is easily tradeable.
The latter part of the hearing was a robust question and answer period. Many Senators questioned the specific need for regulation.
Senator Paul J. Massicotte questioned the need for bitcoin regulation, asking if it undermined the essence of bitcoin in the first place. Joseph David, CEO of CAVirtEx responded quite quickly, stating that, if Canada hopes to remain in the bitcoin exchange business, banks need to cooperate, and that requires government regulation.
He added:
“Our only other option is going offshore.”
Education and understanding
CAVirtEx’s stance on regulation drew questions from the Senators, who wondered if the very act of regulating undermined bitcoin’s libertarian roots. One senator also brought up the possibility that regulating the currency would add so many costs that the benefits would disappear.
Kyle Kemper called for Canada to “become a global leader on the bitcoin opportunity” and pressed for increased education and understanding before implementing any regulation.
Kemper explained:
“Canada has become one of the leading countries in the world in terms of Bitcoin entrepreneurship and innovation. Before we can come to any conclusions, we must understand what Bitcoin is, how it works, and what the future with Bitcoin may look like.”
Overall, the present Senators had a better-than-average understanding of the currency and the protocol, and were actively engaged throughout the entire presentation. Their questions also touched on HST and taxation concerns, volatility risk with merchant purchases, and bitcoin’s impact on the current Canadian dollar money supply.
Regulation questions
The question from the Senate remains: “What is necessary from us?”
Influential bitcoiners like Andreas Antonopoulos, Chief Security Officer at BlockChain.info, regularly oppose regulation, citing the ability of the community to self-regulate as sufficient for the industry.
Additionally, it was mentioned that there are already regulations in place that keep bitcoin ‘in check’, including FINTRAC – an independence agency that reports to the Ministry of Finance. Many large bitcoin businesses, including panelists CAVirtEx and BitAccess, follow FINTRAC regulations.
However, some senators disagreed with the idea of self-regulation, citing government regulation as “necessary” for bitcoin to succeed. Joseph David requested that bitcoin be considered a foreign currency and regulated in the same way. This comment drew interest from the assembled senators, as it was the first time the idea had been raised.
Regulation is currently a hot topic for bitcoin, as it becomes more mainstream. The recurring theme at the recent Inside Bitcoins New York conference was regulation. Indeed, the US government is also educating themselves on bitcoin: is it a coincidence that a Robocoin ATM was installed and demoed on Capitol Hill on 8th April, while Canada’s Senate were introduced to the local bitcoin ATM on the 9th?
Funnily enough, there was a complete lack of press at the Senate committee hearing tonight, as compared to the overwhelmingly attentive journalists capturing every moment of Congressman Jarod Polis’ purchase of bitcoin on Capitol Hill.
Either way, government is interested. Canada is currently in a unique position to be a leader in the bitcoin space. The country has made it this far without any regulations, however it’s time to be proactive on establishing a policy framework for regulators who are looking for guidance with this sphere.
What happens next is anyone’s guess.
View the full video of the Senate of Canada’s Standing Committee on Banking,
Bitcoin Price Drops 10% as Chinese Exchanges Stop Bank Deposits
Jon Southurst (@southtopia) | Published on April 10, 2014 at 09:26 BST | Asia, News, Regulation
Bitcoin prices crashed today as Chinese businesses began receiving official deposit shutdown notices from banks, confirming recent suspicions of an impending crackdown. Exchanges will stop account recharging via bank accounts between now and 15th April.
Even though the news has been anticipated for over a week now, bitcoin prices sank under $403 from a high of $450.74 on the CoinDesk Bitcoin Price Index after companies began making public announcements on their sites.
coindesk-bpi-chart
Exchange BTCTrade.com made an announcement just before lunchtime in China, followed shortly after by BTC100.org and Huobi. Interestingly, it appears Chinese banks started with smaller exchanges before working up to those with larger trading volumes.
The announcements have all come via the banks themselves, as the PBOC has still not provided exchanges with any official announcement ‘on paper’.
BTCTrade’s statement read:
“With a heavy heart we make this announcement, that BTCTrade just received a telephone call from our bank the Kejicheng (Tech City) branch of China Agricultural Bank Hangzhou, that if we do not stop using our bank account to conduct bitcoin related businesses by 4/15 our account will be frozen. Therefore, we are forced to stop all RMB deposits by 4/15 midnight, although withdrawals will not be affected at [present].”
BTC China CEO Bobby Lee said his company would not be changing any of its banking arrangements until it receives some form of official notice, which hasn’t arrived yet.
“So far, we still have NOT received any official notices from Banks or the PBOC,” he said.
“I have indeed heard that some other exchanges apparently have received notice, but we have not.”
BTC38.com, which specializes in altcoin trading, suspended account funding via bank deposits on 4th April.
At that time, prices of digital currencies other than bitcoin dropped by 20% or more. Hardest hit were megacoin (MEC) and TAGcoin (TAG), which each lost around 50% of their value, while quark fell by 40% and dogecoin around 25%.
Even litecoin, which is traded on most major platforms and is not considered an altcoin per se in China, fell by over 20% in value last week. It is currently trading on BTC-e for just $10.22.
Focus elsewhere
OKCoin and FXBTC also stopped some account funding options after receiving notices from their banks and payment processor partners, but promised to continue trading otherwise after April 15th.
OKCoin CEO Star Xu said, however, that the company was focused more on future expansion plans, and would maintain regular daily operations otherwise.
Said Xu:
“OKCoin’s margin management, risk management, and cash withdraw and coin withdraw functions are working properly at this moment, OKCoin’s English version site will be up quickly, OKCoin will establish overseas offices and move servers there if needed.”
Community unperturbed
In fact, much of China’s bitcoin community shares that spirit and does not seem perturbed by regulatory moves.
“OK is always here, rumor-spreaders can leave now, we already have plans for April 15th,” said OKCoin’s Vice President He Yi.
The industry so far has shown nonchalance in the face of previous government bans, whether implied or actual, since last December, and have developed new ways for customers to move money in and out of exchanges without direct access to bank accounts. These have included a variety of third-party payment processors, pre-paid cards, and a voucher system.
Even BTCTrade’s announcement today ended on a positive note, informing of the company’s intentions to expand overseas in the near future.
“BTCTrade has always set our sites on the global market since coming online, and we have already registered companies in mainland China, Hong Kong, Japan and the US. We are planning to commence USD services soon, and the Japanese version of our website is already online and operational, and a new version will be online before 4/15.”
“Very soon we will publicly reveal our cold wallet address, and utilize 100% proof of reserves, in order to ascertain that the platform does not engage in any transactions, and that user assets are safe, open to public scrutiny.”
CoinDesk will continue to monitor and update this developing story.
Jon Southurst (@southtopia) | Published on April 10, 2014 at 09:26 BST | Asia, News, Regulation
Bitcoin prices crashed today as Chinese businesses began receiving official deposit shutdown notices from banks, confirming recent suspicions of an impending crackdown. Exchanges will stop account recharging via bank accounts between now and 15th April.
Even though the news has been anticipated for over a week now, bitcoin prices sank under $403 from a high of $450.74 on the CoinDesk Bitcoin Price Index after companies began making public announcements on their sites.
coindesk-bpi-chart
Exchange BTCTrade.com made an announcement just before lunchtime in China, followed shortly after by BTC100.org and Huobi. Interestingly, it appears Chinese banks started with smaller exchanges before working up to those with larger trading volumes.
The announcements have all come via the banks themselves, as the PBOC has still not provided exchanges with any official announcement ‘on paper’.
BTCTrade’s statement read:
“With a heavy heart we make this announcement, that BTCTrade just received a telephone call from our bank the Kejicheng (Tech City) branch of China Agricultural Bank Hangzhou, that if we do not stop using our bank account to conduct bitcoin related businesses by 4/15 our account will be frozen. Therefore, we are forced to stop all RMB deposits by 4/15 midnight, although withdrawals will not be affected at [present].”
BTC China CEO Bobby Lee said his company would not be changing any of its banking arrangements until it receives some form of official notice, which hasn’t arrived yet.
“So far, we still have NOT received any official notices from Banks or the PBOC,” he said.
“I have indeed heard that some other exchanges apparently have received notice, but we have not.”
BTC38.com, which specializes in altcoin trading, suspended account funding via bank deposits on 4th April.
At that time, prices of digital currencies other than bitcoin dropped by 20% or more. Hardest hit were megacoin (MEC) and TAGcoin (TAG), which each lost around 50% of their value, while quark fell by 40% and dogecoin around 25%.
Even litecoin, which is traded on most major platforms and is not considered an altcoin per se in China, fell by over 20% in value last week. It is currently trading on BTC-e for just $10.22.
Focus elsewhere
OKCoin and FXBTC also stopped some account funding options after receiving notices from their banks and payment processor partners, but promised to continue trading otherwise after April 15th.
OKCoin CEO Star Xu said, however, that the company was focused more on future expansion plans, and would maintain regular daily operations otherwise.
Said Xu:
“OKCoin’s margin management, risk management, and cash withdraw and coin withdraw functions are working properly at this moment, OKCoin’s English version site will be up quickly, OKCoin will establish overseas offices and move servers there if needed.”
Community unperturbed
In fact, much of China’s bitcoin community shares that spirit and does not seem perturbed by regulatory moves.
“OK is always here, rumor-spreaders can leave now, we already have plans for April 15th,” said OKCoin’s Vice President He Yi.
The industry so far has shown nonchalance in the face of previous government bans, whether implied or actual, since last December, and have developed new ways for customers to move money in and out of exchanges without direct access to bank accounts. These have included a variety of third-party payment processors, pre-paid cards, and a voucher system.
Even BTCTrade’s announcement today ended on a positive note, informing of the company’s intentions to expand overseas in the near future.
“BTCTrade has always set our sites on the global market since coming online, and we have already registered companies in mainland China, Hong Kong, Japan and the US. We are planning to commence USD services soon, and the Japanese version of our website is already online and operational, and a new version will be online before 4/15.”
“Very soon we will publicly reveal our cold wallet address, and utilize 100% proof of reserves, in order to ascertain that the platform does not engage in any transactions, and that user assets are safe, open to public scrutiny.”
CoinDesk will continue to monitor and update this developing story.
Bitcoin Core Version 0.9.1 Fixes Heartbleed Vulnerability
Nermin Hajdarbegovic | Published on April 9, 2014 at 11:50 BST | Bitcoin protocol, Technology
Bitcoin Core Version 0.9.1 is out and it has addressed the Heartbleed OpenSSL vulnerability, also known as CVE-2014-0160. The vulnerability has been patched by major bitcoin exchanges in a matter of hours.
In case you missed it, Heartbleed is a pretty big deal in the security community. The crypto bug in OpenSSL (an open-source implementation of the SSL and TLS internet security protocols that encrypt and secure internet traffic) has opened up two thirds of the web to eavesdropping. It was uncovered earlier this week and many observers described it as nothing short of catastrophic.
Bitcoin players quick to address Heartbleed
Luckily the news quickly translated into industry-wide action: patches are being implemented across the world as we speak.
Bitcoin exchanges and wallets are targeted by hackers on a daily basis, so serious bitcoin outfits keep track of zero day exploits, new attack vectors and a host of other vulnerabilities.
The Bitcoin Core team says version 0.9.1 is a maintenance release to fix an urgent vulnerability (ie Heartbleed), and all users should upgrade as soon as possible. Most have heeded the call and as a result the vast majority of major bitcoin sites and exchanges have implemented the fix.
What is Heartbleed all about?
OpenSSL is the most popular code library for HTTPS encryption. It is not used by Microsoft IIS, so Windows-based systems cannot be directly affected.
While this is good news for most desktop users out there, IT departments would rather have it the other way around. OpenSSL is used on Linux, BSD and numerous custom server platforms. Mac OS X is affected, too. The bug does not affect all versions of OpenSSL, either. Some major banks like Chase and Schwab rely on Microsoft IIS. Others rely on Linux/Apache, Java and other systems.
Ars Technica reports the bug is the result of a “mundane coding error” in OpenSSL. The bug essentially allows attackers to gain access to chunks of private computer memory that handles the OpenSSL process.
The contents of said memory chunks may include authentication credentials or even private keys that can undermine the website’s entire cryptographic certificate.
Hence, website operators need to patch their servers with OpenSSL version 1.0.1g and update their security certificates. The problem is that the OpenSSL patch is just the first step. Users need to think about replacing their X.509 certificates once they apply the OpenSSL update.
All admins and users are advised to change their passwords as a precaution as activity is traceless, and this scale of vulnerability is unprecedented in OpenSSL.
Nermin Hajdarbegovic | Published on April 9, 2014 at 11:50 BST | Bitcoin protocol, Technology
Bitcoin Core Version 0.9.1 is out and it has addressed the Heartbleed OpenSSL vulnerability, also known as CVE-2014-0160. The vulnerability has been patched by major bitcoin exchanges in a matter of hours.
In case you missed it, Heartbleed is a pretty big deal in the security community. The crypto bug in OpenSSL (an open-source implementation of the SSL and TLS internet security protocols that encrypt and secure internet traffic) has opened up two thirds of the web to eavesdropping. It was uncovered earlier this week and many observers described it as nothing short of catastrophic.
Bitcoin players quick to address Heartbleed
Luckily the news quickly translated into industry-wide action: patches are being implemented across the world as we speak.
Bitcoin exchanges and wallets are targeted by hackers on a daily basis, so serious bitcoin outfits keep track of zero day exploits, new attack vectors and a host of other vulnerabilities.
The Bitcoin Core team says version 0.9.1 is a maintenance release to fix an urgent vulnerability (ie Heartbleed), and all users should upgrade as soon as possible. Most have heeded the call and as a result the vast majority of major bitcoin sites and exchanges have implemented the fix.
What is Heartbleed all about?
OpenSSL is the most popular code library for HTTPS encryption. It is not used by Microsoft IIS, so Windows-based systems cannot be directly affected.
While this is good news for most desktop users out there, IT departments would rather have it the other way around. OpenSSL is used on Linux, BSD and numerous custom server platforms. Mac OS X is affected, too. The bug does not affect all versions of OpenSSL, either. Some major banks like Chase and Schwab rely on Microsoft IIS. Others rely on Linux/Apache, Java and other systems.
Ars Technica reports the bug is the result of a “mundane coding error” in OpenSSL. The bug essentially allows attackers to gain access to chunks of private computer memory that handles the OpenSSL process.
The contents of said memory chunks may include authentication credentials or even private keys that can undermine the website’s entire cryptographic certificate.
Hence, website operators need to patch their servers with OpenSSL version 1.0.1g and update their security certificates. The problem is that the OpenSSL patch is just the first step. Users need to think about replacing their X.509 certificates once they apply the OpenSSL update.
All admins and users are advised to change their passwords as a precaution as activity is traceless, and this scale of vulnerability is unprecedented in OpenSSL.
Gavin Andresen Steps Down as Bitcoin’s Lead Developer
Kadhim Shubber (@kadhimshubber) | Published on April 8, 2014 at 11:09 BST | Bitcoin Foundation, Bitcoin protocol, News
Bitcoin’s lead developer Gavin Andresen is stepping down, and handing the reins over to colleague Wladmir van der Laan, also a very experienced bitcoin core developer.
Andresen, who was responsible for maintaining the core code that underpins the bitcoin ecosystem, said he was taking a step back to focus on broader bitcoin issues as Chief Scientist of the Bitcoin Foundation, the body that standardizes, protects and promotes the use of bitcoin across the globe
In a blog post published yesterday, Andresen wrote:
Today, I find it harder and harder to keep up with all of the great Computer Science or Economics papers related to bitcoin and other crypto-currencies […] to be clear: I’m not going to disappear […] I’ll just spend a little less time writing Bitcoin Core release announcements, and a little more time catching up on the latest bitcoin-wizards thinking on how best to implement transaction history pruning.
Wladmir van der Laan, a Dutch computer scientist with a PhD in computer graphics from University of Groningen, will be taking over as Bitcoin Core Maintainer.
Past experience
Van der Laan, who has already been working full-time on maintaining the core code, is the most prolific bitcoin contributor with the highest number of commits on GitHub (although, of course, when it comes to development it’s not all about quantity).
Previous projects by van der Laan include Dropship, which in 2011 enabled the sharing of private files on DropBox and thus exposed the poor security practices of the service. DropBox moved to kill the project, asking van der Laan to remove it from Github and then filing DMCA notices against people who mirrored the files on their own Github accounts.
Van der Laan and Andresen were unavailable for comment.
Kadhim Shubber (@kadhimshubber) | Published on April 8, 2014 at 11:09 BST | Bitcoin Foundation, Bitcoin protocol, News
Bitcoin’s lead developer Gavin Andresen is stepping down, and handing the reins over to colleague Wladmir van der Laan, also a very experienced bitcoin core developer.
Andresen, who was responsible for maintaining the core code that underpins the bitcoin ecosystem, said he was taking a step back to focus on broader bitcoin issues as Chief Scientist of the Bitcoin Foundation, the body that standardizes, protects and promotes the use of bitcoin across the globe
In a blog post published yesterday, Andresen wrote:
Today, I find it harder and harder to keep up with all of the great Computer Science or Economics papers related to bitcoin and other crypto-currencies […] to be clear: I’m not going to disappear […] I’ll just spend a little less time writing Bitcoin Core release announcements, and a little more time catching up on the latest bitcoin-wizards thinking on how best to implement transaction history pruning.
Wladmir van der Laan, a Dutch computer scientist with a PhD in computer graphics from University of Groningen, will be taking over as Bitcoin Core Maintainer.
Past experience
Van der Laan, who has already been working full-time on maintaining the core code, is the most prolific bitcoin contributor with the highest number of commits on GitHub (although, of course, when it comes to development it’s not all about quantity).
Previous projects by van der Laan include Dropship, which in 2011 enabled the sharing of private files on DropBox and thus exposed the poor security practices of the service. DropBox moved to kill the project, asking van der Laan to remove it from Github and then filing DMCA notices against people who mirrored the files on their own Github accounts.
Van der Laan and Andresen were unavailable for comment.
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