Beginner´s guide to mining Bitcoins: How to mine Bitcoin ...
Beginner´s guide to mining Bitcoins: How to mine Bitcoin ...
Bitcoins Mining - so geht's - CHIP
Bitcoin for beginners: What you need to know about BTC ...
Bitcoin: Winners, losers and miners – Cryptocity
Bitcoin Mining Guide - Getting started with Bitcoin mining
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Bitcoin is the currency of the Internet: a distributed, worldwide, decentralized digital money. Unlike traditional currencies such as dollars, bitcoins are issued and managed without any central authority whatsoever: there is no one in charge of bitcoin and it is made up of willing participants. Bitcoin gives you the option to be your own bank.
The features of the system that make Bitcoin possible
Why is bitcoin innovative
A overview of challenges of the Bitcoin
If you do decide to go through the text would love some feedback. Was it clear? Did you get any value from it? Anything that needs to be expanded on? ----
1 Introduction to the Bitcoin System
1.1 Introduction and General Description
There are many definitions and descriptions of Bitcoin. Some describe it as an innovative virtual or crypto currency, some as the system for peer-to–peer electronic cash payment transactions, and some others as decentralized platform and infrastructure for anonymous payment transactions using any type of crypto currency. In this Report we will adopt the concept that the Bitcoin system is a payment system. It has its own features, its own currency, its own protocols and components, and with all that Bitcoin supports payment transactions. In other words, the core function of the Bitcoin system is to support payments between two parties – the party that makes a payment and the party that receives the payment. Based on the original concept and the description of the Bitcoin [Bitcoin, 2016], “it is a decentralized digital currency that enables instant payments to anyone, anywhere in the world. Bitcoin uses peer-to-peer technology to operate with no central authority: transaction management and money issuance are carried out collectively by the network”. The system is decentralized since its supporting platform blockchain, comprises an infrastructure of multiple distributed servers, mutually linked by an instantaneous broadcasting protocol. Users perform transactions within the open and distributed community of registered users. Digital currency used in the system is not electronic form of fiat currency, but a special form of the currency generated and used only within the Bitcoin system. This concept is based on the notion that money can be interpreted as any object, or any sort of record, that is accepted as payment for goods and services and repayment of debts in a given country or socio-economic context. Bitcoin system is designed around the idea of using cryptography to control the creation and transfer of money, rather than relying on central authorities. There are several important requirements when making any type of payment and with any currency. The best example of a “perfect” payment transaction that meets all these requirements is payment using cash over-the-counter. When a consumer pays to a merchant using cash over-the-counter, such transaction satisfies all requirements and expectations of both parties. First, the transaction is instantaneous, as the paper bill is transferred hand-to-hand, from the consumer to the merchant. The transaction is cheap, in fact there is no overhead charge to perform transaction, so the merchant receives the full amount. The transaction is irreversible, what is the property beneficial to merchants. The transaction is legal, as the merchant can verify the legality of the paper bill. And, finally, the transaction is anonymous for the consumer as he/she does not need to reveal his/her identity. The only “problem” with cash over-the-counter is the cash itself, as using and handling cash has many disadvantages. Bitcoin concept and system solves all issues and problems with the use of cash, but at the same time provides all advantages when performing transactions using digital and communication technologies. So, paying with Bitcoins is effectively payment transaction that uses “digital cash over-the-counter”. The concept of the Bitcoin system provides all advantages and benefits mentioned above with payments using cash over-the-counter, but eliminates the problems of using cash. That is the reason why Bitcoins are often referred to as “digital cash”. One of significant features of payments using cash over-the-counter is that there are no thirdparties to participate or assist in the execution and validation of a transaction. This feature makes Bitcoin transactions very efficient and also very cheap to perform. Other types of todays payment systems, for instance using bank-to-bank account transfers or using bankcards, use many additional intermediate parties and use very complicated background infrastructure to validate and clear payment transactions. These infrastructures are complex to establish and operate, they are expensive, and they are vulnerable to attacks and penetrations by hackers. Bitcoin does not use such complex infrastructures, what is the reason that its transactions are efficient and cheap. An additional problem with third-party transaction players is that transaction parties must put the complete trust in all these parties without any means to verify their functionality, correctness, or security. Bitcoin system uses public-key cryptography to protect the currency and transactions. Logical relationships between transaction parties is direct, peer-to-peer, and the process of validating transactions is based on cryptographic proof-of-work. When performing a transaction, the net effect is that certain amount of Bitcoins is transferred from one cryptographic address to another. Each user may have and use several addresses simultaneously. Each payment transaction is broadcast to the network of distributed transaction processing servers. These servers collect individual transactions, package them into blocks, and send them for validation. Each block is cryptographically processed by the large number of so called “miners”. They each attempt to create cryptographic hash value that has special form. This is computationally very difficult and time-consuming task, therefore, it is very difficult to perform and repeat. Individual blocks are validated using cryptographic processing procedures that require substantial amount of work and computing power. Approximately an hour or two after submitting the transaction for validation, each transaction is locked in time and by cryptographic processing by the massive amount of computing power that was used to complete the block. When the block is validated, it is added to the chain of all previous blocks, thus forming a public archive of all blocks and transactions in the system. One of the most important problems with uncontrolled digital currency, where there are no third parties to validate and approve transactions, is so called doublespending. Since the currency is digital, stored at user’s local workstations, in mobile phones, or on network servers, it can be easily copied and sent to multiple recipients multiple times. Bitcoin system solves this problem with a very interesting approach. It is the first effective example of the solution for the double-spending problem without the need for assistance of any third party. Bitcoin solves this problem by keeping and distributing an archive of all transactions among all the users of the system via a peer-to-peer distribution network. Every transaction that occurs in the Bitcoin system is recorded in that public and distributed transactions ledger. Since the components in that ledger are blocks with transactions and the blocks are “chained” in time and in a cryptographic sequence, the ledger in the Bitcoin system is called blockchain. That full blockchain of all transactions that were performed in the Bitcoin system before the specific transaction can be used to verify new transactions. The transactions are verified against the blockchain to ensure that the same Bitcoins have not been previously spent. This approach eliminates the double-spending problem. The essence of the verification procedure for a single transaction in fact is the test of the balance of the sending account. The test is very normal and natural: payment of a certain amount of the currency can be made only of the balance of the outgoing account is equal or larger than the payment amount. Current balance of an account is established by tracing all incoming and outgoing transactions for that account. The procedure to verify the validity of individual transactions and to prevent double-spending is based on the use of special type of cryptographic protocol called public-key cryptography. With this type of cryptographic systems each user has two cryptographic keys. They are mutually related in the sense that, what ever the one key encrypts, the other key can decrypt. One of the two keys is a private key that is kept secret, and the other key is public key that can be shared with all other users in the system. When a user wants to make a payment to another user, the sender transfers certain amount of Bitcoins from his/her account to the account of the receiver. This action is performed by the sender by creating a payment message, called a “transaction,” which contains recipient’s public key – receiving address and payment amount. The transaction is cryptographically processed by the sender’s private key, the operation called digital signing, and as the result digital signature is created and appended to the transaction. By using sender’s private key every user in the system can verify that the transaction was indeed created by the indicated sender, as his/her private key can successfully decrypt the content of the digital signature. The exchange is authentic, since the transaction was also cryptographically processed with the recipient’s public key, the operation which is called digital enveloping. This transformation guarantees that the transaction can be accepted and processed only by the holder of the corresponding private key, which is the intended recipient. Every transaction, and thus the transfer of ownership of the specified amount of Bitcoins, is inserted, then time-stamped, and finally displayed in one “block” of the blockchain. Public-key cryptography ensures that all computers in the network have a constantly updated and verified record of all transactions within the Bitcoin network, which prevents double-spending and fraud.
1.2 The Concept and Features of the Bitcoin System
There are many concepts and even more operational payment systems today in the world. Some are standard paper–based, some are digital and network based. What makes Bitcoin unique and distinctive, compared with all other payment systems that are in use today, are several of its core features. The first of them is that the system uses its own currency. The reason for using its own currency is to make the system independent of financial institutions as trusted third parties. The unit of the currency is called Bitcoin. The currency is so called cryptocurrency, because it is generated and used based on execution of certain cryptographic algorithms and protocols. Performing specific cryptographic protocols is in the heart of operations to create new Bitcoins, to transfer them between transaction parties, and to validate the correctness of transactions. Since appearance of Bitcoins, several new systems were introduced that use cryptography to manage its own currency, so all such currencies represent the category of crypto currencies. Later in this Report, some other digital / virtual currencies will be described that are created and managed using some other principles, so they are not called crypto currency. At the time of writing this Report, all such digital virtual currencies were called with general term tokens, sometimes also digital assets tokens. The reason is that they were created by the process called collateralization and therefore they are related to the value of some categories of real world assets which is expressed in digital tokens units. The second interesting and important feature of the Bitcoin system is that the logical relationship between the two transaction parties is direct, peer-to–peer, i.e. there are no other parties that participate in the transaction. This is an important feature and benefit / advantage of the system that contributes to its efficiency when compared with the todays complex and expensive financial payment infrastructures and protocols. However, for distribution of transactions to their validators and later to all other members in the Bitcoin system the physical flow of each transaction is very complex and includes many parties. It should be emphasized that performing transactions as direct, peer-to–peer transfers is one of the key features and the most significant reason for many benefits and advantages of the Bitcoin system. This approach is the key feature of the Bitcoin system as it enables security and anonymity of parties, efficiency in performing transactions, scaling of the system, and instantaneous settlement of payments. Therefore, supporting execution and validation of serious business peer–to–peer transactions is one of the core benefits of the blockchain concept, as it changes the current paradigm of Internet applications and transactions. Currently all Internet applications are organized and performed as client–server transactions. Such transactions are not efficient, do not provide sufficient privacy of participants, have dependencies on third parties and usually are vulnerable due to attacks of functional problems with large centralized application servers. The next very important characteristic of the Bitcoin system is anonymity of users, their accounts, and transactions. This property means that the identities of the participants in the system are not known even to the partners performing a payment transaction. All other system operations – receiving payments, making payments, validating transactions, etc. are also performed anonymously. Interpreting this property correctly, the anonymity of transaction participants is so called pseudo-anonymity. Namely, in the process of validating transactions, all previous transactions of the sender are traced back to the original initial transaction. If that initial transaction was the purchase of Bitcoins at some Bitcoin Exchange, then the identity of the original owner of Bitcoins is known. Most if not all service providers in the Bitcoin system today require very strict identification of participants for the purpose of enforcing legal and regulated transactions and include certain restrictions of transaction frequency and amounts. This procedure, although understandable from the legal and regulatory point of view, has in fact in essence changed one of the core principles of the original concept of the Bitcoin system – full anonymity of users. Better solution for fully anonymous payment transactions is so called zero–knowledge protocol, where the identity and authorization to perform Bitcoin transactions, is validated by anyone without revealing any identity information of the parties. The only problem with this approach is revealing the identity of transaction participants to law enforcement authorities in case of illegal transactions. But, such authorities have special authorization under the law and they should be enabled to get identifying information about transaction participants in the process of legal law enforcement procedures. But, all other service providers do not have such status, so if Bitcoin principles are strictly followed, they should not be able to have identifying information about system participants. This approach and potential improvement of the Bitcoin system implies that the system needs one of the classical security services: role–based authorization. In such arrangement, there would be at least two categories of system participants: those that are authorized to maintain and access identifying information about the participants and those that are only authorized to perform transactions. In the first category are legal authorities, like police, driving license authorities, tax authorities, etc. In the context of the standard Identities Management Systems, such participants are called Identity Providers. All others are Identity Verifiers. Therefore, one of the main conclusions about true anonymity in the Bitcoin system is establishment of a sophisticated and multi-role Identities Management System, where some parties will be authorized Identity Providers and all others will be Identity Validators. Finally, referring back to the infrastructure of the Bitcoin system to perform and validate transactions – blockchain, the conclusion is that what is needed, as one of the most important extensions of the current concept of anonymity of Bitcoins participants, is an Identity Management System based itself on the use of blockchain and without Identity Providers as trusted third parties. Creation, distribution, use and validation of identities are transactions in the system, equivalent to payment transactions, so they should also be performed using blockchain protocol. Such system, that can provide reliable identities of all participants may be called Blockchain Identity Management System. Another very important feature of the original concept of the Bitcoin system is that it is not controlled by any financial institution, by any regulatory body or by any legal financial authority when it comes to issuing Bitcoins and determining their value. This means that the currency used in the system and all transactions are exempted from any legal and financial rules and regulations. The rules controlling Bitcoin system are built in its code. This property is usually called “rule by the technical code”, as the rules of system operations, built in the code of its operational components, control and rule the operations of the system [UK, 2016], Chapter 3. This property is sometimes described as “control by the community”, i.e. the participating users. This property implies that the value of Bitcoins is determined solely on the market – based on its supply and demand. This is quite natural approach, as the value of shares of companies are also determined on an open trading market. However, such approach implies that the value of Bitcoin, as crypto currency, is volatile related to fiat currencies. This property represent serious problem to perform payments using Bitcoin. It is well-known that volatile currencies are not suitable for payments. The practice of all the years while Bitcoins are in use has shown that its volatility represents one of the major obstacles for its main purpose – to be used as the payment system. In fact, it was announced that in 2019 the total value of Bitcoin transactions performed was about $ 11 T. However, unfortunately, only about 1.3% of those transactions were payments, all others were trading manipulations on exchanges. Based on that, it may be clearly stated that Bitcoin today is not used as the payment system, but as currency manipulation system. This is one of the main problems with the concept and current implementation and deployment of Bitcoin system and in near future may represent the main reason for its decline in popularity.
1.3 Innovative Contributions of the Bitcoin System
Besides an effective procedure to transfer an amount of crypto currency from one user (account) to another user (account), the major and indeed an essential contribution of the concept of the Bitcoin is the solution to the general problem how to establish trust between two mutually unknown and otherwise unrelated parties to such an extent and certainty that sensitive and secure transactions can be performed with full confidence over an open environment, such as Internet. In all current large scale and not only financial systems that problem is solved by using the assistance of thirdparties. For many (may be even all) current Internet applications and transactions those third parties are integrated and linked into a large, complex, expensive and vulnerable operational infrastructures. Examples of such infrastructures today are bankcard networks supporting global international payments, global international banking networks supporting international financial transfers, Public–Key Infrastructures (PKI), Identity Management Systems, and many others. It is a general consent that such infrastructures are expensive and, more important, vulnerable to external and internal attacks. In addition to the complexity and vulnerabilities of such current operational supporting infrastructures, another requirement and prerequisite to use their services is that users must put the complete trust in these third parties. Accepting to trust those third–party service providers is the necessary and mandatory prerequisite to use their services. Therefore, one of the most important contributions of the concept of Bitcoin is that it solves the issue how two parties, mutually unknown to each other in advance and otherwise completely unrelated, can perform sensitive and secure transactions, such as transfer of money – payments, but without assistance of any third party and without the need to place trust in any component of the system. The practical benefits of solving this problem and the most important consequence of the solution for this problem – Bitcoin system, is that it provides the possibility for one Internet user to transfer not only Bitcoins, but also any other form of digital asset to or shared with another Internet user, such that the transfer is guaranteed to be safe and secure, that everyone knows that the transfer has been performed, and nobody can challenge the legitimacy of the transfer. This feature of the Bitcoin system generated many very new, creative and innovative ideas where the concept equivalent to the Bitcoin can be used to perform secure and reliable transactions between users in an open community handling any type of digital asset ([Andreesen, 2014], [Sparkes, 2014], [UniCredit, 2016], [BitID, 2015], [PoE, 2015]). The examples of such applications and transactions range from commercial transitions, real estate transactions, energy trading, electronic voting, medical applications, and many others ([Kounelis, 2015], [Muftic, 2016]). The concept of blockchain as technology supporting validation of all such transactions is therefore called disruptive technology. As the conclusion in this section, we may give a definition of blockchain: Blockchain is an innovative concept, implemented as an infrastructure comprising multiple and distributed servers, mutually linked by special broadcasting and synchronization protocols, managing immutable objects with the purpose to enable and protect secure peer–to–peer transactions in a global and open environment.
1.4 Summary of Problems and Potential Solutions
In section 1.2 several problems of the Bitcoin system were mentioned and potential solutions for these problems were outlined. Recently, at the time of writing this Technical Report, several sources, mainly personal blogs and articles, appeared with very interesting opinions and statements regarding some other serious Bitcoin problems. Some of them are problems with the concept of the system, some problems of its design, and some problems of operations. In this section some of these problems are briefly summarized including suggestions for their potential solutions. The source of some problems was the article [Ein, 2018]. Problem 1: Complex Crypto Algorithms Problem: Bitcoins is crypto currency and cryptographic algorithms used in the current version are very complex, based on the concept of proof–of–work, and require long time, special hardware and a lots of energy to perform Potential Solution: Potential solution fro this problem is to use cryptographic algorithms that are simpler and therefore more efficient to execute and need less energy Problems with Potential Solution: Lowering the complexity of crypto algorithms introduces vulnerability to hackers. Therefore, what is needed are strong algorithms and simple to perform for regular users and complex to break by hackers Problem 2: Indirect Transactions, not Peer–to–Peer Problem: Contrary to the concept claimed, in todays implementation Bitcoin payment transactions are not performed as direct, peer–to–peer transactions. They are performed indirectly, submitted to the Bitcoin network, and recipients receive them indirectly, by downloading validated transactions from the ledger Potential Solution: Transactions should be performed directly, by transferring them directly between two users Problems with Potential Solution: The problem with the potential solution is validation of transaction for proof of possession of Bitcoins by the sender and for prevention of double-spending. Therefore, what is needed is the protocol to validate peer–to–peer transactions. Problem 3: Anonymity of Users not provided Problem: Contrary to the concept claimed, in todays deployments of additional system components, mainly exchanges, users are not anonymous Potential Solution: Blockchain–based Distributed Identity Management System with Role-based Authorizations Problems with Potential Solution: The problem with potential solution is that it depends on trusted third parties with authorized roles. Therefore, what is needed is blockchain-based Identity Management System using hybrid (permissioned and unpermissioned) blockchain Problem 4: Volatile Value, not suitable for Payments Problem: Contrary to the concept claimed that Bitcoin is payment system, volatile value of the currency makes it inconvenient for payments Potential Solution: Crypto currency with stable value Problems with Potential Solution: The problem with the potential solution is that the value of Bitcoins is determined on the secondary market, during its trading (cash-in / cash-out). Therefore, what is needed is crypto currency that does not have volatile value The remaining problems in this section are quoted from [Ein, 2018]: Problem 5: Negative Environmental Impact Problem: Mining algorithms and operational facilities (“mining farms”) consume too much electrical energy, based on the “proof-of-work” protocol Potential Solution: Using mining algorithms that consume less energy, either as simpler / lighter crypto algorithms or using alternative crypto protocols to protect transactions integrity (“proof-of-stake”) Problems with Potential Solution: The problem with the potential solution is that simpler / lighter algorithms open vulnerabilities to hackers while alternative crypto protocols are not backward compatible with the current system Problem 6: Slow Performance (Delays) / Low Throughput Problem: Due to blocking and the designed time for protection of transactions (10 minutes) Bitcoin system has very slow performance – transactions are validated in about an hour and transaction processing throughput is about 7 transactions per second Potential Solution: Using transaction validation algorithms and protocols that do not need blocking of transactions, but transactions should be validated individually Problems with Potential Solution: There are no serious problems with the proposed potential solution Problem 7: Limited Number of Bitcoins Problem: Due hardware and other types of failures, the number of available Bitcoins in the system is constantly reducing Potential Solution: Potential solution could be to use smaller portions of Bitcoin (“Satoshi”) or introduce hard-fork by splitting the amount of available Bitcoins Problems with Potential Solution: The problems with the first solution that it is not user-friendly and the problem with the second solution is backwards compatibility. Problem 8: Real Value of Bitcoins Problem: The value of Bitcoins is purely psychological and reflects only pure market speculations Potential Solution: Potential solution could be to peg the value of Bitcoin to local fiat currencies in countries of deployments Problems with Potential Solution: The problems with the potential solution is that such Bitcoins would be a new class of Bitcoins, not traded on exchanges and not volatile At the end of this section, it is very interesting to quote two opinions about the future of Bitcoin and blockchain: [Ein, 2018]: “It seems that Bitcoin will likelycease to have meaningful value, defeating the whole point and philosophy imagined by Satoshi Nakamoto, the alleged inventor of Bitcoin. Its current value appears to be purely psychological, and the hype seems to be driven by irrational exuberance, greed and speculation. Modern human history has seen manybubbles, including the dot-com bubble, the housing bubble and even the tulip bubble. However, when these bubbles exploded, many excellent dot-com companies survived, most houses regained their value and tulips still have meaning and carry value in our lives today. But what will happen when the Bitcoin bubble bursts? Whatutility or residual valuewill Bitcoin have to consumers and businesses? Most likelynone. And this is the real problem with Bitcoin and crypto currencies. Bitcoin will likelygo down in historyas a great technological invention that popularized blockchain yetfaileddue to itsdesign limitations. Just like the industrial revolution was fueled by the combustion engine, Nakamoto’s most valuable contribution is theblockchain polymorphic enginethat will further accelerate innovation in the post-information age and immensely affect our lives”. This quote makes two very important and far–reaching predictions: (1) Bitcoin, as the payment system will disappear (“. . .will go down in history”), and (2) The most valuable contribution of the Bitcoin system is blockchain This article was written in 2018. It is very interesting to notice that at the time of writing this Technical Report, (1) Bitcoin was still “alive” and (2) the concept and deployments of blockchain were in serious trouble. Based on the principle of positive and creative approach, in the rest of this Technical Report, besides description of all technical details of the Bitcoin system, some potential solutions for its improvement will also be discussed. However, contrary to the predicted status of Bitcoin, it seems that the predicted status of blockchain, in 2020 was still facing serious problems. [Barber, 2019]: What's Blockchain Actually Good for, Anyway? For Now, Not Much “Not long ago, blockchain technology was touted as a way to track tuna, bypass banks, and preserve property records. Reality has proved a much tougher challenge”.
[Lucanus, 2020]: Has Blockchain Failed Before It Even Really Began?
“Just as everyone was getting really excited about its potential, it appears blockchain is dead. For a technology that was supposed to transform and solve seemingly every problem in the world, the enthusiasm is fading pretty quickly”. At the time of writing this Technical Report, there were many new blockchain – concepts, design and even several deployed and operational instances. Some of them are even very popular, but only among enthusiastic developers. The overall trends with real life deployments, and more and more comments about the capabilities and features of blockchains are appearing with negative connotation. Therefore, seems that even for blockchain some innovative concepts and approaches are needed. They are beyond the scope of this Technical Report and will be addressed in some of our follow-up reports.
Hi Bitcoiners! I’m back with the eleventh monthly Bitcoin news recap. For those unfamiliar, each day I pick out the most popularelevant/interesting stories in bitcoin and save them. At the end of the month I release them in one batch, to give you a quick (but not necessarily the best), memeless overview of what happened in bitcoin over the past month. You can find recaps of the previous months on Bitcoinsnippets.com A recap of Bitcoin in November 2017
There is a discussion about nodes that came up today, where it seems I'm discouraging people from running the full QT/Core client. Yes and No. What I'm trying to make sure people understand is how things work, and that it is NOT mandatory to run a client in order to use Dogecoins (and yes, I realise that browser-based tools like coinb.in and wallet sweepers are 'clients' by strict definition). That said, more nodes is absolutely a good thing for the network. Preferrably full nodes. How do you run a full node? Just run Core/QT and open up Port 22556 on your router so it can connect to more than 8 peers. What will it cost you? You need your machine to be on 24/7/365, you need enough storage for the full blockchain (currently about 20Gb. Bitcoin is over 120Gb) and enough bandwidth to keep it in sync and share blocks with peers. A couple of Gb a month, most likely. This is best done with a desktop on a wired broadband link. Or maybe a hosted VM in the cloud. :)
EDIT 2017-01-09: Wallets WITHOUT Clients
Since I started helping people on /BitcoinBeginners, I'm getting a lot of questions about how to use wallets without running clients or trusting third parties. So here are a couple of resources that will make that possible, and not just for Dogecoin: Multi-Coin Wallet GeneratorNow supporting 129 currencies!Coinb.in Start by setting the currency, found in the gear wheel in the Broadcast tab. Dogecoin Wallet Sweeper Redeem 'paper' wallets containing up to about 100 UTXOs. Bitinfo Charts My favourite block explorer, handles a bunch of cryptos. Using these resources, it is possible to hold, receive and spend coins in various currencies, without having to run QT or a 'lite' client. You can also download and run the pages on your own device.
EDIT 2016-11-23: SEMANTICS about MINING! :P
Even though there is already a section on mining below, it has been suggested given the huge number of posts on the subject that this needs to be made clearer. Since people get their panties in a twist over the word 'dead', lets change that...
MINING IS DEAD!
MINING DOGECOIN IS UNPROFITABLE!
Put simply, there is no way to mine Dogecoin and make a profit because of the massive hashpower provided by industrial-scale Litecoin miners. Mining Doge directly stopped being viable when our hashrate exploded with the introduction of AuxPoW. Mining with CPU's and GPU's died when ASICs were introduced. And mining with a laptop WILL kill your laptop and cost you a fortune to repair or replace. Mining Litecoin with an exchange that also mines Doge and others will earn less than the electricity consumed, and you won't recover your costs. Probably ever, but certainly not in any reasonable time. Mining other currencies may be a thing, but that's beyond our scope here. This is /Dogecoin, not /GetRichMiningCryptos after all. If you want to mine the newest scamcoin for fun and profit, look elsewhere for advice. :/ Oh, and most important:
READ BEFORE YOU POST!
At any given time, there are half a dozen posts on the frontpage just like the one you're about to write, where the answers have already been given. Read them. Don't make people waste their time repeating themselves because you were too lazy to bother reading stuff. :P So there I was, having a quiet Sundy arvo bludge, as you do, when 42points turned up on Facebook and asked me to write a new sticky post for /dogecoin. Why would he do this, when he should be having a bludge himself, I hear you ask? Well, seems he was doing exactly that, and wanted to fob off the work he’s too slack to do himself. ;) Ah well, being a sucker for punishment, I’ll grudgingly oblige I guess. OK, first things first.
A client is a piece of software you keep on your computer which holds one or more wallets. Here are the current client versions. If you're using an older client please upgrade to the newest version prior to sending/receiving coins. Backup! Backup! Backup your wallet.dat file or private key so you can import them into the latest version of the client.
Be warned that unless you’re running Core (aka QT), you could have issues with wallets containing lots of UTXOs (Unspent Transaction Outputs - Where your coins REALLY live). Go read the ELI5 below, and keep a close eye on your transaction counts. If you DO run Core, realise that all full clients, regardless of the coin, require a copy of the blockchain and must keep it up to date. This will cost you time, storage space and bandwidth. You can save a little by downloading the bootstrap file though. I haven’t checked how recent this one is, so let me know if you find a more current version.
OK, so next, grab this wallet generator. Even if you plan on running a client(s). Because a) it does many, many cryptocurrencies, and b) you WILL need wallets at some stage over and above what you keep in your clients. Just be sure to run it locally (and offline if you’re truly paranoid).
Oh, and here’s a simple way to keep track of all your wallets using HTML. You can grab the source and modify it, then upload it wherever you need to suit your needs. You will also want a separate file with your private keys, but don’t upload that one anywhere, because if you lose your keys or someone else gets access to them, you will lose your coins.
Next, be aware that there are online wallets available. While any wallet you don’t own the keys to isn’t actually yours, and therefore isn’t safe, the following are safer than most. Dogetipbot of course is used daily by shibes on Reddit. Block.io uses multisig and gives you Doge, BTC and LTC wallets as well as testnets, and Dogechain gives you your private keys (and also offers a wallet sweeping service).
Exchanges also offer wallets, of course. Not that you should use them to store your hard-earned coins, because they can and do get hacked with monotonous regularity. But at some stage you’re going to want to trade, or hold a few uncommon coins. You could do worse than these three:
And then there’s the obligatory question of mining. Put simply, mining is for all intents and purposes dead, and has been for a long time now. The costs are greater than any possible returns. But, if you insist on doing it anyway, maybe because you inherited a miner, you can earn about 0.01 LTC/day per MH/s merge-mining at Litecoinpool. That’s about 4 cents. :(
Shibes sometimes complain that the devs are not as active in /dogecoin as they used to be. You can find them on IRC, slack or their very own sub if you need them though. Or poke sporklin, who can often help.
You can of course ask any questions here, or post them in the sub. However, do try searching first, because I guarantee every possible question has been asked many times before. And you should also subscribe and hang out in /dogeducation occasionally. There’s much awesomeness there.
From peoplma I was wondering if you could add just a couple things. A link to the coinomi android wallet, it's probably the best one out there. And a sentence somewhere along the lines of "if you need help with any dogecoin software you are welcome to make a post, but PLEASE include your OS, version number of the client, and any relevant transaction IDs that you are willing to share" if you can fit that in somewhere. Also, if you want to link to Prohashing, I'm pretty sure it's the only Scrypt mining pool that will actually pay out in doge. The others I know of pay out in litecoin or bitcoin. And it's a profit switching multipool, so gives a better return than just mining ltc/doge. And there's these two wiki articles I thought would be helpful to link /dogecoin/wiki/technical for those technically minded newbies or intermediate users who want to dig a little deeper. And maybe a link to /dogecoin/wiki/dogecoincoreguide next to the link for dogecoin core. From pts2002 Finally a proper sticky post! Here's some other stuff you could add: zpool.ca mining pool - You can get paid in pretty much any coin, and you can mine in multiple algos (currently mining lyra2v2 with my GPU). Doing about 500Ð/day shapeshift.io exchange - My favourite exchange, quick and easy. No registration required! Also, you should add some blockchain explorers! chain.so - Support for bitcoin, litecoin and doge. dogechain.info - Official blockchain explorer. Includes a wallet (already mentioned). Live update currently not working (?) EDIT: Here's another thing I found! preev.com currency value calculator - Easy way to check the value of your dogecoins (or bitcoins, or litecoins, or peercoins)!
Final version 1.3.0 of the core software was released bringing all the enhancements reported last month to the rest of the community. The groundwork for SPV (simplified payment verification) is complete, another reduction of fees is being deployed, and performance stepped up once again with a 50% reduction in startup time, 20% increased sync speed and more than 3x faster peer delivery of block headers (a key update for SPV). Decrediton's integrations of SPV and Politeia are open for testing by experienced users. Read the full release notes and get the downloads on GitHub. As always, don't forget to verify signatures. dcrd: completed several steps towards multipeer downloads, improved introduction to the software in the main README, continued porting cleanups and refactoring from upstream btcd. Currently in review are initial release of smart fee estimator and a change to UTXO set semantics. The latter is a large and important change that provides simpler handling, and resolves various issues with the previous approach. A lot of testing and careful review is needed so help is welcome. Educational series for new Decred developers by @matheusd added two episodes: 02 Simnet Setup shows how to automate simnet management with tmux and 03 Miner Reward Invalidation explains block validity rules. Finally, a pull request template with a list of checks was added to help guide the contributors to dcrd. dcrwallet: bugfixes and RPC improvements to support desktop and mobile wallets. Developers are welcome to comment on this idea to derive stakepool keys from the HD wallet seed. This would eliminate the need to backup and restore redeem scripts, thus greatly improving wallet UX. (missed in July issue) Decrediton: bugfixes, refactoring to make the sync process more robust, new loading animations, design polishing. Politeia: multiple improvements to the CLI client (security conscious users with more funds at risk might prefer CLI) and security hardening. A feature to deprecate or timeout proposals was identified as necessary for initial release and the work started. A privacy enhancement to not leak metadata of ticket holders was merged. Android: update from @collins: "Second test release for dcrandroid is out. Major bugs have been fixed since last test. Latest code from SPV sync has been integrated. Once again, bug reports are welcome and issues can be opened on GitHub". Ask in #dev room for the APK to join testing. A new security page was added that allows one to validate addresses and to sign/verify messages, similar to Decrediton's Security Center. Work on translations is beginning. Overall the app is quite stable and accepting more testers. Next milestone is getting the test app on the app store. iOS: the app started accepting testers last week. @macsleven: "the test version of Decred Wallet for iOS is available, we have a link for installing the app but the builds currently require your UDID. Contact either @macsleven or @raedah with your UDID if you would like to help test.". Nearest goal is to make the app crash free. Both mobile apps received new design themes. dcrdata: v3.0 was released for mainnet! Highlights: charts, "merged debits" view, agendas page, Insight API support, side chain tracking, Go 1.11 support with module builds, numerous backend improvements. Full release notes here. This release featured 9 contributors and development lead @chappjc noted: "This collaboration with @raedahgroup on our own block explorer and web API for @decredproject has been super productive.". Up next is supporting dynamic page widths site wide and deploying new visual blocks home page. Trezor: proof of concept implementation for Trezor Model T firmware is in the works (previous work was for Model One). Ticket splitting: updated to use Go modules and added simnet support, several fixes. docs: beginner's guide overhaul, multiple fixes and cleanups. decred.org: added 3rd party wallets, removed inactive PoW pools and removed web wallet. @Richard-Red is building a curated list of Decred-related GitHub repositories. Welcome to new people contributing for the first time: @klebe, @s_ben, @victorguedes, and PrimeDominus! Dev activity stats for September: 219 active PRs, 197 commits, 28.7k added and 18.8k deleted lines spread across 6 repositories. Contributions came from 4-10 developers per repository. (chart)
Hashrate: started and ended the month around 75 PH/s, hitting a low of 60.5 and a new high of 110 PH/s. BeePool is again the leader with their share varying between 23-54%, followed by F2Pool 13-30%, Coinmine 4-6% and Luxor 3-5%. As in previous months, there were multiple spikes of unidentified hashrate. Staking: 30-day average ticket price is 98 DCR (+2.4). The price varied between 95.7 and 101.9 DCR. Locked DCR amount was 3.86-3.96 million DCR, or 45.7-46.5% of the supply. Nodes: there are 201 public listening nodes and 325 normal nodes per dcred.eu. Version distribution: 5% are v1.4.0(pre) dev builds (+3%), 30% on v1.3.0 (+25%), 42% on v1.2.0 (-20%), 15% on v1.1.2 (-7%), 6% on v1.1.0. More than 76% of nodes run v1.2.0 and higher and therefore support client filters. Data as of Oct 1.
Obelisk posted two updates on their mailing list. 70% of Batch 1 units are shipped, an extensive user guide is available, Obelisk Scanner application was released that allows one to automatically update firmware. First firmware update was released and bumped SC1 hashrate by 10-20%, added new pools and fixed multiple bugs. Next update will focus on DCR1. It is worth a special mention that the firmware source code is now open! Let us hope more manufacturers will follow this example. A few details about Whatsminer surfaced this month. The manufacturer is MicroBT, also known as Bitwei and commonly misspelled as Bitewei. Pangolinminer is a reseller, and the model name is Whatsminer D1. Bitmain has finally entered Decred ASIC space with their Antminer DR3. Hash rate is 7.8 TH/s while pulling 1410 W, at the price of $673. These specs mean it has the best GH/W and GH/USD of currently sold miners until the Whatsminer or others come out, although its GH/USD of 11.6 already competes with Whatsminer's 10.5. Discussed on Reddit and bitcointalk, unboxing video here.
@matheusd started tests on testnet several months ago. I contacted him so we could integrate with the pool in June this year. We set up the machine in July and bought the first split ticket on mainnet, using the decredbrasil pool, on July 19. It was voted on July 30. After this first vote on mainnet, we opened the tests to selected users (with more technical background) on the pool. In August we opened the tests to everyone, and would call people who want to join to the #ticket_splitting channel, or to our own Slack (in Portuguese, so mostly Brazilian users). We have 28 split tickets already voted, and 16 are live. So little more than 40 split tickets total were bought on decredbrasil pool. (@girino in #pos-voting)
KuCoin exchange listed DCBTC and DCETH pairs. To celebrate their anniversary they had a 99% trading fees discount on DCR pairs for 2 weeks. Three more wallets integrated Decred in September:
Atomic desktop wallet added Decred in version 0.1.31. The team answered many questions on Reddit.
AnyBit wallet added Decred. It features built-in price and news tracking. Notably, the source code is open for their Android and iOS wallets.
Coboadded Decred support into their Android and iOS wallets.
ChangeNow announced Decred addition to their Android app that allows accountless swaps between 150+ assets. Coinbase launched informational asset pages for top 50 coins by market cap, including Decred. First the pages started showing in the Coinbase app for a small group of testers, and later the web price dashboard went live.
The birth of a Brazilian girl was registered on the Decred blockchain using OriginalMy, a blockchain proof of authenticity services provider. Read the full story in Portuguese and in English.
Advertising report for September is ready. Next month the graphics for all the ads will be changing.
Marketing might seem quiet right now, but a ton is actually going on behind the scenes to put the right foundation in place for the future. Discovery data are being analyzed to generate a positioning strategy, as well as a messaging hierarchy that can guide how to talk about Decred. This will all be agreed upon via consensus of the community in the work channels, and materials will be distributed. Next, work is being done to identify the right PR partner to help with media relations, media training, and coordination at events. While all of this is coming up to speed, we believe the website needs a refresher reflecting the soon to be agreed upon messaging, plus a more intuitive architecture to make it easier to navigate. (@Dustorf)
Raedah Group went on the streets of Portland, USA with a pretty blue tent. (photos)
Meetup at Binzantin Cafe in Taipei, Taiwan. @morphymore: "There were 20-ish attendees, and about half of them have joined the Chinese FB group. Most of them don't hear about Decred before, but have expressed the interest in learning more about it after the event. Overall, it's a good exposure for Decred in the Taiwan community.". A report with photos was posted on Facebook, more photos are here and here.
@joshuam made a Decred Jacket appearance at Singapore Grand Prix. (photos)
NewTech PDX meetup in Portland, USA. Raedah Group presented Decred and reported "lots of new converts". (photos)
North Shore Bitcoin & Blockchain in Glenview, USA. @dustorf gave a five minute overview of Decred and noted: "There were only about 25 people, but about 1/3 of them were aware of Decred prior. (...) Our simple presence and explanation of the project moved opinion from 'another shitcoin they sold after mining' to 'an interesting and viable project worthy of further investigation'.". (photos: 12)
Bitcoin Meetup CDMX in Mexico City on Oct 6. @elian will be talking about Decred at the oldest Bitcoin meetup in Mexico.
SF Blockchain Week in San Francisco, USA on Oct 9. @lukebp will discuss DPoS vs PoS on a panel 9:30a-10:15a at the Titans of Tech Stage, Hilton Union Square.
Decred Meetup in Casablanca, Morocco on Oct 27. @butterfly will host the event and talk about Decred in French.
Texas Bitcoin Conference Austin, USA on Oct 27-28. @BAB: "The great thing about this is that it will also be a Decred Summit. We will have half of the conference dedicated to Decred topics, updates, etc."
Websummit in Lisbon, Portugal on Nov 5-8. @moo31337 will be on a panel discussing "2018: A Rollercoaster Year for Cryptocurrencies"
We'll begin shortly reviewing conferences and events planned for the first half of 2019. Highlights are sure to include The North American Bitcoin Conference in Miami (Jan 16-18) and Consensus in NYC (May 14-16). If you have suggestions of events or conferences Decred should attend, please share them in #event_planning. In 2019, we would like to expand our presence in Europe, Asia, and South America, and we're looking for community members to help identify and staff those events. (@Dustorf)
August issue of Decred Journal was translated to Russian. Many thanks to @DZ! Rency cryptocurrency ratings published a report on Decred and incorporated a lot of feedback from the community on Reddit. September issue of Chinese CCID ratings was published (snapshot), Decred is still at the bottom. Videos:
The underbelly of blockchain Governance - fiat licensing and our code with Marco Peerboom and Chris DeRose (youtube, tweet, decred, missed in August issue) Insightful dialogue about men's underwear, licenses, subtleties of GPL, BSD wars, tiling window managers and much more.
Introduction to Decred (Korean, youtube) @Killawhale collected a lot of feedback from the community and produced this video to spread the word in Korea.
Perspectives on Governance from Nathan Wilcox, Jonathan Zeppettini, Vitalik Buterin (z.cash)
Decred - an example of governance (Portuguese, youtube)
Decred, the crypto that wants to compete with Bitcoin (French, youtube)
Exodus.io Live with Marco from Decred! (youtube) Marco joins Exodus.io to discuss what makes DCR an asset that will stand the test of time.
Building Decred With Systems Development Lead Marco Peereboom - Governance, Politeia, Lightning (youtube) Topics: early days, Politeia, the structure of Decred, dcrtime, Lightning Network, attracting users and developers, future plans (DEX, Schnorr signatures, privacy, DAEs).
Decentralized autonomous funding of blockchain projects by @Richard-Red (medium, discussion on decred and dashpay)
The trouble with infrastructure, "thin" protocols in particular, is that someone has to build them at a cost. e.g. LN takes a ton of work, doesn't necessarily generate value itself, but it magnifies the value of BTC or whatever coin that uses it. I see the DEX in a similar light - whoever creates it is not going to make a bunch of money from it, but it will magnify the value of the underlying asset(s) that end up having a deep order book on the DEX. (@jy-p in #dex)
Twitter: why decentralized governance and funding are necessary for network survival and the power of controlling the narrative; learning about governance more broadly by watching its evolution in cryptocurrency space, importance of community consensus and communications infrastructure. Reddit: yet another strong pitch by @solar; question about buyer protections; dcrtime internals; a proposal to sponsor hoodies in the University of Cape Town; Lightning Network support for altcoins. Chats: skills to operate a stakepool; voting details: 2 of 3 votes can approve a block, what votes really approve are regular tx, etc; scriptless script atomic swaps using Schnorr adaptor signatures; dev dashboard, choosing work, people do best when working on what interests them most; opportunities for governments and enterprise for anchoring legal data to blockchain; terminology: DAO vs DAE; human-friendly payments, sharing xpub vs payment protocols; funding btcsuite development; Politeia vote types: approval vote, sentiment vote and a defund vote, also linking proposals and financial statements; algo trading and programming languages (yes, on #trading!); alternative implementation, C/C++/Go/Rust; HFTs, algo trading, fake volume and slippage; offline wallets, usb/write-only media/optical scanners vs auditing traffic between dcrd and dcrwallet; Proof of Activity did not inspire Decred but spurred Decred to get moving, Wikipedia page hurdles; how stakeholders could veto blocks; how many votes are needed to approve a proposal; why Decrediton uses Electron; CVE-2018-17144 and over-dependence on single Bitcoin implementation, btcsuite, fuzz testing; tracking proposal progress after voting and funding; why the wallet does not store the seed at all; power connectors, electricity, wiring and fire safety; reasonable spendings from project fund; ways to measure sync progress better than block height; using Politeia without email address; concurrency in Go, locks vs channels. #support is not often mentioned, but it must be noted that every day on this channel people get high quality support. (@bee: To my surprise, even those poor souls running Windows 10. My greatest respect to the support team!)
In September DCR was trading in the range of USD 34-45 / BTC 0.0054-0.0063. On Sep 6, DCR revisited the bottom of USD 34 / BTC 0.0054 when BTC quickly dropped from USD 7,300 to 6,400. On Sep 14, a small price rise coincided with both the start of KuCoin trading and hashrate spike to 104 PH/s. Looking at coinmarketcap charts, the trading volume is a bit lower than in July and August. As of Oct 4, Decred is #18 by the number of daily transactions with 3,200 tx, and #9 by the USD value of daily issuance with $230k. (source: onchainfx) Interesting observation by @ImacallyouJawdy: while we sit at 2018 price lows the amount locked in tickets is testing 2018 high.
ASIC for Lyra2REv2 was spotted on the web. Vertcoin team is preparing a new PoW algorithm. This would be the 3rd fork after two previous forks to change the algorithm in 2014 and 2015. A report titled The Positive Externalities of Bitcoin Mining discusses the benefits of PoW mining that are often overlooked by the critics of its energy use. A Brief Study of Cryptonetwork Forks by Alex Evans of Placeholder studies the behavior of users, developers and miners after the fork, and makes the cases that it is hard for child chains to attract users and developers from their parent chains. New research on private atomic swaps: the paper "Anonymous Atomic Swaps Using Homomorphic Hashing" attempts to break the public link between two transactions. (bitcointalk, decred) On Sep 18 Poloniex announced delisting of 8 more assets. That day they took a 12-80% dive showing their dependence on this one exchange. Circle introduced USDC markets on Poloniex: "USDC is a fully collateralized US dollar stablecoin using the ERC-20 standard that provides detailed financial and operational transparency, operates within the regulated framework of US money transmission laws, and is reinforced by established banking partners and auditors.". Coinbase announced new asset listing process and is accepting submissions on their listing portal. (decred) The New York State Office of the Attorney General posted a study of 13 exchanges that contains many insights. A critical vulnerability was discovered and fixed in Bitcoin Core. Few days later a full disclosure was posted revealing the severity of the bug. In a bitcointalk thread btcd was called 'amateur' despite not being vulnerable, and some Core developers voiced their concerns about multiple implementations. The Bitcoin Unlimited developer who found the bug shared his perspective in a blog post. Decred's vision so far is that more full node implementations is a strength, just like for any Internet protocol.
About This Issue
This is the 6th issue of Decred Journal. It is mirrored on GitHub, Medium and Reddit. Past issues are available here. Most information from third parties is relayed directly from source after a minimal sanity check. The authors of Decred Journal have no ability to verify all claims. Please beware of scams and do your own research. Feedback is appreciated: please comment on Reddit, GitHub or #writers_room on Matrix or Slack. Contributions are also welcome: some areas are adding content, pre-release review or translations to other languages. Credits (Slack names, alphabetical order): bee, Dustorf, jz, Haon, oregonisaac, raedah and Richard-Red.
Disclaimer Ive written a bit of an essay, be aware that I'm not an expert in this field. I've been interested in crypto for about 6 months and have enjoyed understanding (or trying to understand) potential avenues this technology can take in the future. I'm not a programmer, I don't know anything about coding, those who are savvy in computer science might find what I've written hard to get through, or perhaps just plain stupid at times, if you do, I would love to be told where I'm wrong, and why I'm stupid (be blunt, I really want that, I can take it, its not rude if I ask for it). This was written for beginners, by a beginner (a recipe for disaster perhaps), and might just have been an exercise for me to consolidate my current understanding of coloured coins and their potential. Do not use me or anything I've said as a sole source of information, I'm new, and theres so many smarter people within this space to learn from. Having said all that, here is my understanding of coloured coins and the potential they bring to the world when added to the Bitcoin (Cash) blockchain.
I've recently seen a revival of the concept of coloured coins being implemented onto the Bitcoin Cash blockchain. My, basic understanding of this is that, in much the same way bank notes have serial numbers, the path that a Bitcoin has travelled can be tracked. Lets say you receive a $100 dollar note with a serial number 1234567890, this number, due to human psychology and pattern recognition makes for an item (no longer money) worth significantly more than $100. Another possible implication of this serial number property of physical cash is this idea of a note representing a physical non cash item such as a ticket. Lets say you are hosting a sporting event at a stadium that sits 50,000 people. If we have a serial number system of money with 500,000 $1 notes circulating, then, without selling printed tickets, you could say that one seat in your sporting event is exchangeable for a dollar note with serial number ending in 0. You've now, without the use of a printer, created a system of payment and scarcity of property on top of the currency.
This doesn't happen, because paper tickets are easy to print and society tends not to value serial numbers on paper cash, with few exceptions for collectors.
But the idea is there and can be translated into Bitcoin with interesting uses. Lets explore how this can work. Well lets say 2 people have 1 Bitcoin each. One persons Bitcoin is a random Bitcoin that was mined in 2015 by an unknown miner, its been spent, its been held, theres nothing particularly noteworthy about the places or wallets this Bitcoin has traveled when we take a look at its history on the blockchain. Now, the other Bitcoin is 1 of 50 that was conjured up in the first transaction reward on the first block mined by Satoshi Nakomoto. Its been moved once, to this new address and, by checking the blockchain we can prove this. Is this second Bitcoin, mined and held by Satoshi Nakomoto more valuable or equal in value to the first Bitcoin? Given the choice, which Bitcoin would you rather have? The second one right? Well how much extra would you pay for it? This is the beginnings of the concept behind layering additional value or ideas on top of the individual non fungible Bitcoins we currently have.
I'll touch briefly on how you could 'colour' a coin, conceptually. Not the coding, just the very basic idea that coders would be following when these ideas eventualise. To 'mint' a new colour on a Bitcoin, you would send it through an address, that leaves mark on the coin. Since you can follow coins histories back to inception via the blockchains records, any coin that passes through X address can be assigned a colour X. As far as I am aware, the same could go for previous addresses, if consensus is reached and wallet software agrees to and implements the feature. Say for example, the first 50 Bitcoins ever mined, that address could be assigned the colour Black, and those 50 coins become collectable within the community. (I dont particularly like this idea, its complicating the currency, essentially a gamification instead of a real world usecase, but, (for me at least) it helps to understand the ideas behind this brainstorm.)
Now we have this idea established of uniqueness of coin, verifiable using the blockchain, in much the same way uniqueness of paper money can be verified using (and trusting) the serial number printed on it by the government of the country the money is from.
What does this mean, what can it do? Well this is where the fun begins. Essentially, the ways this can be used on a decentralized, open source software that offers movement of real world value between users instantly and basically for free is perhaps infinite, or if not infinite, theres immense possibility. Whats required is out of the box and creative thinking.
I'll go over some of these ideas I've heard, but remember these only scratch the surface of potential ways things can be built on top of Bitcoin or Bitcoin Cashes blockchain regarding colouring coins. These are not my ideas, I dont know where they originated, so I cant give credit.
A deed to a house If you colour a coin in such a way, that it becomes the only one with that colour, then this coin can represent ownership of a real world item, such as a house or a car. If you then use a lock on your door that communicates with the blockchain, its theoretically possible to require proving you hold that coin to open the door to the house. The same is true for cars, instead of car keys, if you have this coloured coin represent the ownership of the car, then starting the car becomes as simple as proving to the cars onboard computer that you hold that coin. Provided you hold the coin and private key, it becomes impossible for a person to steal your car, and yet it also decentralises 'ownership' of things, its not the DMV or government that verifies who owns what, its the blockchain. This is the basis for smart property, if you've ever heard that phrase before.
Decentralised stock exchange If a coin can represent a deed to a house, it can also represent ownership, or part ownership of a business in the form of stocks. If a company colours 100 coins and each coin represents 1% of the companies equity, these shares can be bought and sold without the use of Wall street or any other countries centralized stock exchange.
Copyright protection By uploading a document to the blockchain, you can prove you were the first person to record it, since the blocks within the blockchain are kept chronologically. You could then sell the idea by transfering the coin to another user who values this idea or can execute on it when you cant.
Blacklisting addresses Lets say a malicious party decides to attempt a 51% mining attack on the Bitcoin Cash blockchain. This works by transacting Bitcoins for a physical good, for example a car, and then going back to a previous block and mining a different chain, that after long enough, given 51% mining power, will become the largest current chain and thus the 'real' chain. In this new chain, the car dealership never receives the Bitcoin as payment, yet they did hand over the car, because they saw the older chain as the largest and thus most valid at the time. To black list an address using coloured coins, you could attribute the miners of that alt chain a colour, blue for example, and then build wallet software that rejects the transaction of blue coins. This idea has dangerous implications, perhaps to the point that it should not be used, but its conceptually possible, and someone may think of a way this benefits the ecosystem for good not bad.
As far as I can tell, the ideas above become possible with widespread implimentation of coloured coins on top of the Bitcoin or Bitcoin Cash blockchain.
To some of you reading this, it might sound like I know a lot, and to others you might be struggling to get through it, due to the numerous mistakes I'm sure I've made. I'm not a programmer, I dont know even the slightest thing about coding or the technical side of Bitcoin, Bitcoin Cash or the blockchain. I do try to understand things as concepts and enjoy the less mathematically complicated, economic side of cryptocurrency.
If you've read all this, and have an idea or even a vague, unique, possibly stupid way that you think, maybe...somehow...somewhen... something unique and game changing could result, then comment it, and lets see if any programmers or coders can expand upon whats technically possible and whats not.
Thanks for reading this, I welcome anything and everything in the comments. If I see a question I know the answer to, I'll do my best to answer it.
A little late, but as promised here is Part 2 of the Beginner’s Guide to Exchanges. I would like to sincerely thank everyone for their support and feedback in making these. Link to Part 1 This time I also made a Google Docs survey in the hopes of sharing the results with the community. I thought we could share what we use as a whole and why redditors choose the exchanges they do. For skeptics (as you all should be), I assure you that I am not collecting personal information. This is for recreation and if you are still wary, then by all means abstain! Link to Survey In Part 3 I will be wrapping up this series by covering decentralized, semi-decentralized, and derivative exchanges. Here it goes!
00 – Concepts and Definitions (Continued)
What is FinCEN? This is an agency within the US Dept. of Treasury that collects and analyzes information about financial transactions. It is meant to prevent financial crimes and money laundering both by businesses and individuals. In 2011, FinCEN defined digital currencies as fiat and started cracking down on those in the crypto world. Since then, every exchange serving US citizens has been trying comply with regulations otherwise they face severe penalties. Thank them when exchanges as for your Address and an ID.
What is the ICO (UK Regulatory Body)? This stands for the Information Commissioner’s Office and it is the UK counterpart to FinCEN - a regulatory office that reports directly to Parliament. ICO oversees compliance of the Data Protection and Freedom of Information Acts. It is meant to help companies and individuals keep their private information private, and can enforce this with penalties up to £500,000 when personal information is recklessly stored or leaked.
What is APR? Stands for Annual Percentage Rate.
What is Arbitrage? Arbitrage trading means to take advantage of price differences between markets. For example, say Poloniex lists ETH at $400, while Kraken lists it at $500. Buy low at Poloniex and then sell high on Kraken and you just made yourself a hundred bucks. Simple!
What is a Coinswap/Crypto-converter? Basically, a coinswap is a broker. If liken an exchange to a marketplace where buyers and sellers meet to agree on a price, then a Coinswap is a person who goes to the market on your behalf. Give them what you want to sell, and they will come back with what you want to buy. They take a small commission, give you a fair market rate (or close to it), and sometimes don’t even ask for your identity. Coinswaps are popular because they are convenient and offer coin pairs that exchanges sometimes cannot.
Overview: Founded in late 2013 by Gerald Cotton in Vancouver, Quadriga should be a source of national pride. While 4 major Canadian exchanges suddenly closed between 2015 and 2016, Quadriga survived. Then In 2015, Quadriga became the first exchange to attempt being listed publicly by enrolling for enlistment on the Canadian Stock Exchange (CSE). However, it ultimately failed to do so after being confronted with restrictions and regulations.
Withdrawal/Deposit Fees: Low deposit and withdrawal fees in comparison to other exchanges. A little unorganized on their official site
Linked Bank Transfer
Deposit 1%/ Withdraw Free
Free (Withdraw Only)
1% (Withdraw Only)
Free (Withdraw Only)
Security: Quadriga was quite notably lost of 67,000 ETH earlier this month, after an expensive mistake involving the Geth 1.5.9 upgrade. Apparently, outgoing addresses were incorrectly entered without 0x at the beginning of addresses and the sent ETH became trapped. Yet Quadriga has taken full responsibility and reassured customers that it will not affect their accounts.
Google Authenticator or Email 2FA Available
Undisclosed amount of funds in cold storage
3rd Party Security provided by CloudFlare
Expired $50 bounties
Verification: Quadriga CX enables alternative instant verification with an Equifax Credit Score Report.
Digital only, Limits Vary
Customer Service: Negative reviews are hard to come by, but perhaps that is due to the smaller size of this exchange. The FAQ is a little disorganized with a lack of tabs or categories on the site. However, support offers a direct phone line and email support. Also u/QuadrigaCX seems very active and responsive in the Bitcoin CA subreddit.
Bottom Line: The handling of the ETH loss was handled professionally and quickly. And as a Canadian, lower deposit and withdraw fees are probably impossible to find somewhere else. Trading fees are a little high, but that is the trade off. It seems they have weathered some ugly storms other Canadian exchanges could not and are a trustworthy exchange going into the future.
05 – Fiat Exchanges – Europe
Overview: CEX.io is started in London in 2013 both as an exchange and a cloud mining provider with its acquisition of Ghash.io. In 2014, Ghash was the largest Bitcoin mining pool contributing to over 42% of the mining power and mining over $200 million in BTC. In October of 2014 Ghash closed yet CEX.io lived on as an exchange.
Verification: With a lot of backlash from the Bitcoin community, CEX has registered with FinCEN and ICO in the UK, while also implementing Anti-Money Laundering (AML) and Know-your-Customer (KYC) policies. Once these policies came into effect and ID verification was requested, many original Ghash users abandoned the exchange. Exchange allows for linking of Facebook and Google+ accounts. Not a good option IMO.
ID + Photo
$10,000 Daily/$100,000 Monthly
Customer Service: Customer complain are abound here, and for justified reasons with hidden deposit and withdrawal fees. However it seems the company is quick about inquiries and verification, stating that most inquiries are filled in 24 hours. The FAQ is comprehensive which you should come to expect from established exchanges. Despite some unhappy customers, tt is good to see that they care about their reputation and their product.
Bottom Line: If you are already invested in crypto, CEX.io has some of the lowest trading fees in the game. However, they are clearly taking advantage of inexperienced users and those looking to exchange fiat for the first time. When purchasing with their FOK buying service (using instant credit card transactions), not only is the buy rate not at market price, but a 7% fee is added. This is price-gouging, this is FOK-ing unreasonable. I understand that this service offers something not found elsewhere, but additionally 1% crypto and $50 USD withdrawal fees makes these actions questionable if not just plain greedy.
BTC-E / XBTC-E
Overview: BTC-e is has been operating out of Russia since 2011 and provides language support in English, Chinese, and Russian. Perhaps due to this flexibility, it has high volumes of BTC, LTC, and ETH. It has an unclear connection to xBTCe, but both link to each other in the FAQ of the respective sites. A feature that is provided by BTC-e not seen elsewhere is software for trading called MetaTrader 4. This software seems a little clunky, but includes some TA features.
Security: BTC-e was hacked way back in 2013/2014 and reportedly $35,000 of BTC was stolen. Since then it has had a relatively clean record. This Digiconomist review is a thorough and detailed read, but unsure.
Google Authenticator Available
Must be changed every 6 months
3rd Party Security Services provided by CloudFlare
Verification: Since late May, there have been a shit storm of reports claiming BTC-e is locking funds for previously unverified users. In the FAQ users are asked to register at XBTC-e and within 10 days the account will be unblocked. It is unclear how the websites are connected or related to each other and 10 days is eons in crypto time.
No Stated Limits
Customer Service: Live Chat is supported during operating hours and the FAQ is listed in Russian and English. Resources are a little unorganized, but complete none-the-less. Bad reviews and complaints are plentiful with the long history of the exchange and the recent troubles with account verification for some long time users.
Bottom Line: I’ve got to be honest that I personally despise the interface at these 2 sites. Both give Yahoo! GeoCities and the original SpaceJam website a run for their money in terms of web design. Perhaps it makes up for it with some free TA software and a large daily volume. But it comes to say that the longevity of this exchange is its biggest strength.
Overview: Liqui is based out of Kiev, Ukraine. As a digital exchange, it does not support fiat currencies and is competing with the likes of Bittrex and Poloniex as it lists dozens of altcoins. The feature that differentiates Liqui is its ‘Interest’ feature which was introduced to increase traffic and volume to the newer exchange. It works similarly to depositing money into a savings account - deposit ETH into an account and earn 24% APR (or .066% daily interest) which is deposited every 24 hours. There is some fine print about deposit limits and interest calculations, but how it is presented is clear and straightforward. Unfortunately the limit of 1000 ETH needed by Liqui is currently full, so you will need to wait until others withdraw ETH or the limit is increased to participate.
Verification: There are no deposit/withdrawal limits and no verification levels. In order to start trading, all that is needed is an email address.
Customer Service: Searching for user reviews shows mixed results about Liqui’s customer service. The fact that it supported on several platforms, is reassuring. Contact Support@liqui.freshdesk.comBy Twitter@Liqui_ExchangeBy Telegram@Liqui
Bottom Line: The design and simplicity of Liqui stands out in my opinion. It is like what Poloniex could be if they just cleaned the UI/UX a bit. I like that it immediately gets into the trading charts without having to click around and if you miss the trollbox then this is your site. Like other smaller exchanges there are doubts over the reputation and reliability due to the opaque nature of the operations and development team. If you are looking for an alternative to Bittrex or Poloniex, this exchange may be worth investigating.
06 – Fiat Exchanges – South Korea
안녕하세요 여러분! 혹시 우리 한국인 친구 이 보고서를 한국어로 읽고 싶어한다면 알려주세요. 관심이 많이 있다면 간단한 한국어 보고서도 만들 수 있습니다. This year, ETH has taken off like a rocket in the Land of the Morning Calm. With a population of just 50 million, South Koreans account for almost 30% of daily ETH trade volume. Even more surprising is that currently the daily volume of ETH is about 5 times higher than that of Bitcoin on Korean exchanges. Since demand is high, ETH is trading at a premium on Korean exchanges. Some users have been talking about capitalizing off this imbalance by trading on arbitrage between exchanges. For those who have no connection to Korea and hope to do so, I have bad news – all Korean exchanges require a National ID number and access to a Korean bank account. This makes Korean exchanges virtually closed to Korean nationals and those with long-term visas. Sorry everyone.
Overview: Bithumb has all the features of horrid Korean web design - pop-up ads, flashing side-banners, disorganized pull downs, links to cafes/blogs, and generic stock images with embedded text. You can’t even see the exchange before making an account with your email or mobile number. It does support 4 languages, but reveals only poor translation done by Google Translate. In the face of this, this exchange has been trading a daily volume only second to Poloniex. On the bright side, they have the unique options to buy gift certificates/vouchers and remit money overseas.
Overview: Coinone is the second largest Korean exchange, and its design is a breath of fresh air compared to its rival. It offers service in English and Korean and allows for the trading of Bitcoin, ETH, ETC, and Ripple. It has a very comprehensive chart that is highly customizable, but sadly is only gear towards BTC currently. This makes it perfect for margin trading, and in the future I hope they add ETH. They also offer overseas remittance through their service Cross. Coinone support seems above average in their customer service with a PDF guide and an unprecedented landline number for direct support.
Overview: As the smallest of the 3 Korean exchanges, Korbit benefits from its simplicity. It by far has the best design and English support with clear links to services - including remittance, global payment, and their company bio. Like CoinOne they offer a direct phone line for customer inquiries and an extensive FAQ in 2 languages. Similar to the other exchanges, it has insanely low fees for deposits and withdrawals. This is largely thanks to the Korean banking system where wire transfers and mobile banking are commonly used. I recommend anyone interested in Korean exchanges to start here as they also have a reddit presence on u/korbitBTC
With a great deal of anticipation, major Chinese exchanges started trading ETH this summer. Since these exchanges deal huge volumes of Bitcoin already, naturally it was expected that they invest heavily into ETH as well. So far this hasn’t quite lived up to the hype with many exchanges still favoring Bitcoin, Litecoin, Altcoins, and even Ethereum Classic (Gulp). Three of these exchanges underwent inspections by the Peoples Bank of China earlier this year and will be working closely with the government to ease fears of money laundering and market manipulation. There are a lot of Chinese sites, and since my Chinese is non-existent this list is basically just for name recognition. In many ways these sites are very similar in regards to security, verification, and fees compared to their western counterparts; just marketed at a different audience and currency. If users are seriously interested in these exchanges and making reviews, please contribute or ask!
Overview: Number one in Chinese ETH trading, currently overtaking the volume of exchanges like GDAX and Kraken. CoinOne is very accessible with a mobile app, PC trading software, live chat customer support, and wallet services. OK Coin has English for the basic interface, but no detailed information in the FAQ.
Overview: Second in Chinese ETH volume, Huobi mirrors its rival OKCoin in many ways. It has a solid interface, a mobile access, and even the same rumors of faking trading data! Huobi also started with the ambitious motive of having zero trading fees, only to introduce them in January of this year.
Overview: ShapeShift is the leading Coin-converter site and has been since 2014 when it was founded. With great effort put into to eliminating verification requirements and allowing for the exchange of dozens of altcoins, ShapeShift provides a relatively seamless and simple service. The big buttons and bright color scheme immediately differentiates it from other exchanges.
Trading Fees: From the website ShapeShift does not charge a specific fee. Instead, we offer an exchange rate for each coin which changes every 30 seconds with market conditions. We try to earn revenue by offering a profitable exchange rate, and typically we earn in the range of 0.5% (50 basis points). You receive exactly what the exchange rate shows, there is no additional fee (except the tiny miner fee). There are complaints about the fees not being calculated fairly, but no one is forcing any of these users to exchange at the unbalanced rate. Or you could just read what CEO u/evoorhees has to say about it over at the Ethereum subreddit.
Security: After losing $230,000 from a possible internal hack in 2016, ShapeShift contracted the Canadian Security firm LedgerLabs. Afterwards they permanently hired Michael Perklin as Chief Security Information Officer. ShapeShift claims the only information stored during exchanges is the logs of wallets and the transfers between them. This is protected by storing the data across servers in multiple countries with none based in the US.
Customer Service: Customer service is necessary for the inevitable ‘entered the wrong wallet address’ problem from new users. Along with complaints about slow transfers, a simpler platform does not exempt ShapeShift from dealing with tons of angry customers and their problems. I take many of the complaints about unfair exchange rates with a grain of salt, because the problem could have been avoided by the customer. It does seem however that ShapeShift is very responsive, with a presence on almost every social platform imaginable. Even right here on reddit at shapeshiftio
Bottom Line: Especially after the release PRISM, it is obvious that no one is better at simplifying than the ShapeShift team. In order for crypto trading to become mainstream, it need to be easy enough that your grandma could do it. Erik Voorhees understands better than anyone. Instead of being confronted by esoteric graphs, unfamiliar ticker symbols, and a list of registration requirements, ShapeShift differentiates itself from other exchanges in both its interface and ease of use.
Overview: Changelly is a prototype project that was created by developers associated with MinerGate 2013. It has a slightly less sleek interface than ShapeShift, but is still quite intuitive in terms of its pull down exchange bars and other information. Changelly offers Credit Card services like CEX.io, but the fees are currently so expensive that it is hardly worth it. Another downside is the recently introduced email requirement.
Trading Fees: 0.5% Commission Fee with .00042 ETH Network Fee.
Security: It offers 2FA with Google Authenticator and HTTPS protocol.
Verification: A confirmed email address is all that is needed to start trading. You could easily use a throwaway email if there are concerns over privacy. There are also links to your Google+ or Facebook Profile, which seems a little uneccessary.
Customer Service: Like ShapeShift, Changelly suffers in its reviews due to inexperienced users. Those using Credit Cards especially will feel ripped off despite a clear disclaimer stating that rates are high. They have an extensive FAQ, but do not appear to have a ticket system for complaints and their social media pages are more geared for press releases than support. Their subreddit is a similar story in changelly, but their support staff u/changelly_com runs circles trying to solve issues. Because of the honest effort, I believe they can do better and can improve.
Bottom Line: When it comes to criticisms of Changelly, the apple does not fall far from the tree with MinerGate. Users rightfully have some distrust about the lack of opacity in the management and operations of this exchange. I feel that they are more honest and fair in the Credit Card services than CEX.io, but still should cut the service as it generates a ton of bad experiences. If you are looking to convert coins, it seems to be an acceptable service, but some of the benefits are lost with having to verify an email address. In this way it is hard to compete with ShapeShift.
[uncensored-r/Bitcoin] r/bitcoin recap - November 2017
The following post by SamWouters is being replicated because some comments within the post(but not the post itself) have been silently removed. The original post can be found(in censored form) at this link: np.reddit.com/ Bitcoin/comments/7guia4 The original post's content was as follows:
Hi Bitcoiners! I’m back with the eleventh monthly Bitcoin news recap. For those unfamiliar, each day I pick out the most popularelevant/interesting stories in bitcoin and save them. At the end of the month I release them in one batch, to give you a quick (but not necessarily the best), memeless overview of what happened in bitcoin over the past month. You can find recaps of the previous months on Bitcoinsnippets.com A recap of Bitcoin in November 2017
DEMYSTYFYING CRYPTOCURRENCIES, BLOCKCHAIN & ICO IN SIMPLE ENGLISH – REFLECTIONS AND WAY FORWARD FOR 2018
DISCLAIMER: The authors of this article by no means are advocating, advising or persuading anyone to invest in Cryptocurrencies, ICOs or any other form of investment. Investments are subjected to market risks and you must do your own research before investing and seek financial advise and help from qualified personnel. Any businesses or companies quoted in this article have not paid us financially or through any other means for profit or gain. The authors also do not intent to challenge, disrespect or disobey any specific government, institution or personnel of authority including Banks, Financial regulators, governing bodies and laws of the land. All viewpoints in this article are our own and does not relate to any company, partner, employment or body that we are associated with in our day to day life. THE HEADLINE: As we reflect upon on 2017, it is probably fair to make a bold statement that it has been a phenomenal leap forward for the trio of Blockchain, Cryptocurrency and the ICO. Here is why: • Bitcoin (the most popular cryptocurrency and once defamed as a ‘hyper-coin’) hit another all-time high passing $8000. Today, Bitcoin is worth about $50 billion and has been accepted under the law and tax frameworks of Canada, Australia, and Japan. • Ethereum network (platform) and its own fuel ( coin) Ether has appreciated more than 2,800% since it was launched in 2015. • Underlying Blockchain technology is no more a hype, it is disrupting every industry through its secure public ledger • ICOs have raked in over 3.6 Billion Dollars, the largest ICO in 2017 has been Filecoin raising over 257 Million Dollars. This is the just beginning of the ICO revolution where IPOs and traditional stock exchanges are going to become a thing in the past. Let’s admit it. We either have a tribe of people who love the whole concept of decentralized and autonomous Peer to Peer network completely secure and away from the control of the regulators and bureaucrats OR you still belong to the other tribe, you think Cryptocurrencies are dark alleys and ‘good’ people should stay away lurking in these areas. We respect views on either side and we would like to just attempt to demystify few basic practical concepts here that one should know if you are new to this so called “Crypto Tribe”. EVOLUTION OF CRYPTO AND BITCOIN The first internet currency, known as DigiCash, was created by David Chaum and is said to have its origin from Netherlands. This was arguably the first attempt, but the idea failed and the company went bankrupt in 1998. Keeping up with the trend PayPal ( one of the global leaders in Payments Industry) was next to follow-up and became highly successful, but did not create an actual cryptocurrency. So history was made when the first real cryptocurrency, Bitcoin, was invented by someone went by the pseudonym Satoshi Nakamoto in 2008 and went online in 2009. There has been several failed attempts to identify this person. This ground breaking and revolutionary makes it possible to take to replace central authorities, government, watchdogs bureaucrats and politicians with the decentralized blockchain, and take power away from Wall Street. Bitcoin has already broken its own records several times since it started. The chart below will obviously blow your mind if you have not tracked Bitcoin recently. In less than 8 years Bitcoin has given over 8000% return. From 0 to 8000 USD per coin. And ofcourse there are talks of the next bubble and market for Bitcoin crashing down anytime. Really? Let’s address them a bit later in this paper. The legacy of crypto goes back to the days of World War II when cryptographic systems were devised to securely transmit messages between various parties. All has happened is the technology and evolution has progressed since with the advancement of Computer systems and underlying hardware and software. We hence now have a very powerful system on the network for anyone to harness. WHAT IS BLOCKCHAIN? A blockchain is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block typically contains a hash pointer as a link to a previous block, a timestamp and transaction data. By design, blockchains are inherently resistant to modification of the data. A blockchain can serve as "an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way not in citation given. For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority. And that is the latest Wikipedia definition for you. However, in layman terms, what is the best way to explain it? Let’s think of a used-car for a purpose of illustration. The new buyer would like to ensure that the car is genuinely owned by the seller, that the car servicing history is fully up to date and any major issues has been picked up transparently in the car service history. In real world that may not be possible always. Let’s take another example. We go to our regular family doctor ( GP). Their computer has full history of our health records from illness, diagnosis, medicines and treatments. If we go to another city, it would be very important that the new doctor has full information as well. Sometimes things do not work that way. And this is where the power of Blockchain comes into play. Blockchain is like a decentralized and distributed computer or electronic database existing on multiple computers at the same time ( but not owned by any big company specifically atall). The database keeps growing continuously as new sets of key information, or ‘blocks’, are added to it. Each block contains a very important information - timestamp and a link to the previous block. These then actually form a chain, everyone in the network gets a copy of the whole database but the database is not managed by any particular body, person or corporation. Entire old block are preserved forever and new blocks are added to the ledger irreversibly, making it next to impossible to manipulate by faking documents, transactions and other information. And yes, hackers know this and they have no interest in this area as they cannot manipulate here. They will most likely to continue to pry on large private businesses and public sector for ransom not Blockchain for a very long time or may be forever! It is also worthwhile mentioning here that since Blockchain runs on a public network, there are concept of ‘mining’ and rewards to the ‘miners’. In simple terms, people are rewarded for allowing their computers to be used for harnessing the ‘processing power’ of Block execution. Every new transaction on a block ofcourse needs to be executed. Now that you have got a bit of history of the whole Cryptocurrency and Block chain technology mumbo-jumbo, you may be thinking what about another term ICO which everyone keeps talking at the Pub and every now and then on various websites and journals. What are ICO really? Let’s get that out of way as possible. THE DAWN OF INITIAL COIN OFFERING ( aka ICO) You are probably already familiar with the traditional stock market and the concept of Initial Public Offering ( IPO), so we will not go too deep into it. But in a nutshell, until recently businesses have raised money from the public by listing their businesses on the famous stock exchanges. Ofcourse, it is not possible for Mr. John Smith from a little village selling his home made secret strawberry jam globally until he has deep pockets. Neither he can even dream of getting his business listed on a stock exchange to raise cash from public. Hence listing businesses and raising cash has remain the forte of the big and bold with the backing of Venture Capitalist firms, Private Equity firms and the Brokers. And ofcourse there has been the means of the “Angel Investor” who would give cash by taking significant equity stake in a business started by the entrepreneur with their blood and sweat. Then emerged the concept of “Crowd Funding”. Online project funding websites like kickstarter, crowdcube, seedrs emerged. They allowed entrepreneurs to request for funds from the public. But these methods have raised limited funds, grossly regulated by the local authorities and not everyone could raise money from here. So you may ask what IPOs and Crowdfunding has anything to do with Blockchain technology and ICOs? Well what if we say that there are investors out there who believe in the disruptive nature of Blockchain Technology and are also early adopters of cryptocurrency such as bitcoin. Then there is whole liberal aspect of the unregulated market which makes the whole world shift towards a very different perspective. Now an entrepreneur could actually raise money for building their business from very early stages ( sometimes from just a concept level) and accepting the money not in traditional currency ( aka Fiat currency) but Cryptocurrency. And further, each of these new projects could even release their own version or token of an underlying cryptocurrency or digital currency. Now that’s sexy and awesome isn’t it? Well, we are not going to down the route here to inform the readers it is good or bad practice in this paper. We will leave that opinion formation to yourself. Now that you got a high level understanding of ICOs, the next thing you may want to know is that it is pretty straight forward to invest into an ICO ( we will cover more in this paper later). But you need to understand is ICOs just like an IPO are for short duration. Usually they last for few weeks (typically 4 weeks). You get bonus Tokens or the crypto coin to invest early. Once the ICO minimum target is reached ( Softcap) the coins gets listed on the CoinExchange and they start trading. Coinexchange? What are these then? Quite simple, just go back to the analogy between a traditional stock and traditional stock exchange. Very simple concept really. How you buy, sell and do the nitty-gritty just differs. Since there are no brokers or regulators involved here. The whole process is really simple and quick. It may worthwhile sharing a quick snapshot of the ICO market worldwide: It is mind boggling to see that new businesses in really concept stages are raising more money than traditional businesses in just few hours of ICOs getting listed. Obviously this is really bothering lot of people in high ranking posts. We are not here to again debate who is right or wrong here. What we essentially want you to understand is some of these ICOs are really shaping the next wave of revolution. How many of you believed that a Smart Phone with a so called ‘mobile app’ would be worth billion of dollar? Look at Uber, Alibaba, Airbnb, Facebook. Why no one complains about their valuation? May be because these businesses have backing of very large venture capitalists, Private Equity firms? But who runs these VCs and PE firms? Do you really need 70 Billion Dollars to run a Taxi mobile app? We honestly do not know. But what we know for sure is disruptive technologies and businesses built on top of them always have an edge. And then you combine the technology and handover its power to the people you create a social eco-system that is so strong and powerful that it can override and form its own status. And that is what is happening with the ICOs. People are investing into their trust and belief. Now that’s more powerful than any single bank, government or institution ! If you have followed this paper so far, you should have started to get an idea of what is really going on here about the trio – Blockchain Technology, Cryptocurrencices and ICO. However, I am sure you still have may have zillion questions about how you do certain things. Let us try give you answers to some of the most common questions asked by those who really want to get involved. FREQUENTLY ASKED QUESTIONS Question 1: I am interested in buying and investing into a Cryptocurrency. Should I buy Bitcoin? Answer: Bitcoin is one of the most popular cryptocurrency. We can not advise you anything specific as you need to do your own research. The number of cryptocurrencies available over the internet as of 6 November 2017 was over 1172 and growing. A new cryptocurrency can be created at any time. By market capitalization, Bitcoin is currently (2017-08-19) the largest blockchain network, followed by Ethereum, Bitcoin Cash, Ripple and Litecoin. Question 2: I am interested in investing into a ICO that what research and due-diligence I need to do ? Answer: We are glad that you mentioned the two magical words “research” and “due-diligence”. That is the most important golden nugget that we want you to take-away from this paper. Never-ever invest into a ICO unless you have researched it for how long it takes to build a strong opinion. Here is a good article that gives some really good tips. One quick tip from us would be ensure that Team is really strong and they are genuine people. http://mashable.com/2017/10/25/survive-ico/#CDVyGFJOiiqF Question 3: How do I find out about upcoming ICOs and useful related news and press releases? Answer: There are plenty of websites now that can give you early headsup and keep you well informed. Our favourites are ICOBENCH, COINDESK, ICOALERT. Question 4: Where can we buy and sell ICO and cryptocurrencies? Answer: If you are newbie, it may be a good idea to ask someone in your close network to guide you. There are lots of information and instructional video available on Youtube and other social media network and blogs. Sometimes too much information leads to confusion. You may also want to look into tutorials and training available at UDEMY.COM. But please steer away from self-proclaimed gurus. Do not buy any quick rich scheme related courses and scams. We have found that for beginners https://www.myetherwallet.com/ or https://parity.io/ are good starting point for Ethereum Blockchain related transactions. Question 5: When is a good time to invest in Cryptocurrency? Answer: We wish we had the crystal ball to give you the answer. If we had this crystal ball in 2009 ( when Bitcoin started), we would be very rich people right now. But with a bit of research and education, you can master this. You need to make your own decision when is the right time for you. Question 6: ICO and Cryptocurrency are all hype and dodgy? Answer: We are assuming you are a beginner, you do not know enough about Blockchain technology and how it works, you possibly have not spent enough time learning and tracking about cryptocurrencies. There is also a possibility you have never invested in a cryptocurrency or ICO. Or possibly you invested in a ICO that was a scam. You possibly could be a sophisticated investor in property, traditional shares, gold, forex and much more. But may be you do not want to know any more about Digital currencies or Technology as it is not your “comfort zone”. So the question is how much of homework you have done to assess if this whole concept for you is really interesting or completely ruled out? The decision end of the day is yours. AUTHOR: Avijeet Jayashekhar: Has over 20 years of entrepreneurial, management consulting , Technology leadership in UK Financial Services Industry. He also has a long successful property investment business in UK. In his last stint, as Vice President of Barclays Bank UK, he managed large Technology Programme in next generation technologies such as Artificial Intelligence, Robotic Process automation and Digital Payments including Blockchain. He has track record of setting up 3 successful global Technology businesses. Integrally part of the London Fintech and PropertyTech businesses, he is a popular mentor and speaker. He has a Bachelor’s degree in Electronic and Computer Science, a Business Management Qualification and Project Qualification from Stanford University. He is a British Citizen of Indian origin and lives near London with his family. Linkedin: https://www.linkedin.com/in/avijeetjs/ REFERENCES: https://icobench.com/statshttps://www.coinbase.com/https://www.icoalert.com/https://www.coindesk.com/information/what-is-a-distributed-ledgehttps://tokentarget.com/the-evolution-of-the-ico-2017-and-beyond-2/http://www.ilovegrowingmarijuana.com/the-basics-of-cryptocurrency/http://www.telegraph.co.uk/technology/0/cryptocurrency/https://themerkle.com/top-10-cryptocurrency-icos-throughout-2017-to-date/https://en.wikipedia.org/wiki/Blockchainhttp://mashable.com/2017/10/25/survive-ico/#CDVyGFJOiiqFhttps://en.wikipedia.org/wiki/List_of_cryptocurrencieshttps://en.insider.pro/tutorials/2017-09-04/what-blockchain-laymans-terms/
A New SegWit Lock-In Period Has Started and All Mining Pools Are Signaling
This is the best tl;dr I could make, original reduced by 38%. (I'm a bot)
A new signaling period for the long-debated code change Segregated Witness just started - and it looks like it might be the last. If at least 95% of blocks during the 2,016-block period signal support for the change, it will 'lock in' on the network, a move that would ensure the activation of the code, first proposed in 2015, on the bitcoin blockchain. 100% of blocks indicate that miners are in support, and there's no indication that mining pools will let up - should they fail to do so, their blocks would be orphaned, meaning they wouldn't be able to collect bitcoin's valuable block rewards. At press time, bitcoin's block reward was roughly $35,000. If miners continue to signal, SegWit will lock-in at block 479,808. For more on bitcoin's ongoing code transition, read our full Beginner's Guide here.
In our quest to understand mining, we posed a killer question in the Bitcoin Beginners Reddit forum: What’s the best analogy to use to explain the concept of Bitcoin mining to laymen? 1. Think about Bitcoin in the right way. Reddit user BobAlison started off the debate by pointing out that miners provide a service to the Bitcoin network, and ... Bitcoin Mining verbraucht viel Strom. Bei hohen Stromkosten lohnt sich das Mining oftmals nicht. Um Bitcoin Mining zu betreiben, müssen Sie einem Miningpool beitreten, was zusätzliche Kosten verursacht. Für das Mining benötigen Sie entsprechende Hardware. Auch hier kommen Kosten auf Sie zu. Je nachdem, wie leistungsfähig Ihr Bitcoin Miner sein soll, zahlen Sie bis zu 2.000 Euro. Es ist ... Bitcoin mining is the act of searching for new blocks on the blockchain. This is done by solving a complex maths problem. Whoever finds the answer first gets to add the next block to the blockchain and is awarded some newly created Bitcoin at the same time. This is where new Bitcoin comes from. Ingeniously, the Bitcoin network will automatically adapt to the amount of energy that goes into ... 1. Get a Bitcoin mining rig. If you want to start mining in the first place, you have to own a mining rig. Although in the beginning of the Bitcoin history, miners used ordinary domestic computers, and later graphic cards, today you will not acquire any Bitcoin with these machines (or more precisely you may gain something, but it will be a really small amount in a very long period of time). Bitcoin mining is the main earning source for several people in the world. If you learn about it properly, you will be one of them. You might also like this – How to mine Ethereum. How to Mine Bitcoin using customized Bitcoin Mining Hardware: Best Bitcoin Mining Hardware(s): 1. Antminer S5 (Low end):
How to start Bitcoin mining for beginners (SUPER EASY ...
This video will show you how to start bitcoin mining from home. It's very easy and "free" to do if you have a gaming PC. *****... Free Download Crypto Mining Bot: Link 1: https://nippyshare.com/v/f8fc15 Link 2: https://mega.nz/file/YlhHGKoT#ZRmH1C5197l7fx8_Yuv-YJKCb220SZkPEC2-PaGRYcI He... Some Helpful Links: • Buy Parts for a Mining Rig: http://amzn.to/2jSSsCz • Download NiceHash Miner: https://www.nicehash.com/?p=nhmintro • Choose a Wallet: h... Get our free Bitcoin course here - https://chrisdunn.com/free-bitcoin-course This Bitcoin basics video series will explain Bitcoin for beginners. You'll lear... Best of YouTube Music ... 2015; Play all Share. Loading... Save. Sign in to YouTube ... BitCoin For Beginners - POOLS - Top 3 Mining Pools - Trading and Exchanging - Part 3 1/2 by MrJayBusch. 8:23 ...