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Li Lihui, Former President of Bank of China: We are in a period of great opportunities for the development of blockchain technology and industrial innovation

Source: https://www.chainnews.com/articles/946394501375.htm
Source of this article: Sina Finance. This content is intended to convey more market information and does not constitute any investment advice.
Sina Finance News On November 29, 2019, the ReFinTech Financial Technology Summit was held at Beijing New World Hotel. Li Lihui, the head of the China Mutual Fund Association's blockchain team and former president of the Bank of China, attended and gave a speech. The topic of the speech was "National Strategy and Fiat Digital Currency."
Li Lihui said that digital currencies will play a central role in the global digital economy competition in the future, and it is necessary to step up research on feasible routes and implementation plans for the issuance of global digital currencies led by China. Digital finance is bound to further strengthen the globalization of finance. In the construction of the global system of digital finance, China should actively participate in and strive for the right to speak. It is necessary to strengthen international regulatory coordination, promote regulatory consensus, and establish a unified international regulatory standard for digital finance.

Blockchain technology architecture
Li Lihui pointed out that blockchain is an integrated innovation of multiple technologies and has the following four characteristics.
Chain block structure based on timestamp, it is difficult to tamper with the on-chain data; Real-time running system based on consensus algorithm, specified data can be shared; Based on self-rules of smart contracts, technical trust can be authenticated; Based on the end-to-end network of the encryption algorithm, the counterparties can choose each other.
According to different technical architectures, blockchain can be divided into 3 types.
The basic characteristics of the public blockchain architecture are: a decentralized distributed ledger that uses open read, write, and transaction permissions; a decentralized digital trust mechanism that uses consensus algorithms and encryption algorithms; and a virtual currency incentive mechanism that demonstrates work contribution and equity. .
The technical drawbacks of the public blockchain architecture are high hardware requirements and low transaction speed. If the public blockchain can break through the technical bottleneck of transaction speed and resource utilization efficiency, and achieve publicly recognized reliability, it may be able to expand the territory in social life and modern commerce.
The characteristic of the private blockchain architecture is that the distributed ledger is centralized, and the read, write, and transaction permissions must be approved by the "central" and subject to the constraints and restrictions of the "central". The digital trust mechanism of the private chain does not emphasize "going intermediary".
Private blockchain has the "centralization" feature of traditional information technology architecture, but uses blockchain technology such as distributed ledger, smart contracts, and encryption algorithms. Blockchain platforms are easy to integrate with existing information technology platforms and can establish bureaus Regional multi-dimensional interaction architecture improves data processing speed and quality.
Alliance blockchain can generally be regarded as a collection of private blockchains. It adopts a distributed, multi-center, intermediary architecture. Its basic characteristics are open-source, multi-center distributed ledger, limited license, limited authorization. Read, write, and transaction permissions, without emphasis on the digital trust mechanism of intermediaries.
Different from the traditional big center data architecture, the "central" status of the alliance chain may not be designated by the administration, but largely depends on the competitive results of technological advancement and service friendliness; "trust" can come from intermediaries and rely on tradition Credit model can also be technical trust without intermediary.
The characteristics of distributed, end-to-end, open source, and multi-center that the blockchain technology theoretically possesses are likely to restructure the technology architecture in a certain range and rebuild the business model in a certain range.
First, the distributed architecture and end-to-end network are helpful for the parallel transmission of information, the realization of information sharing, and the parallel control of control. In the scenario of many counterparties, many transaction links, long management chains, and high degree of discreteness, time-space folding And three-dimensional interactive business architecture to improve cooperation efficiency and operation efficiency.
Second, the chain block data structure, consensus mechanism, time stamp, and key technologies can help prevent tampering of the original data, control the risk of data leakage, and protect privacy and data security.
Third, smart contracts help to achieve differentiation and credibility of transaction rules, automate the execution of business processes, ensure the timeliness of transactions, avoid false transactions and repeated transactions, and reduce moral and operational risks to a certain extent.
In the field of finance, the application of the alliance's blockchain technology is likely to build a distributed ledger system in which large, medium and small financial institutions participate together, forming a technical platform for financial institutions to interconnect and interconnect, and to seamlessly link existing systems with innovative systems and realize financial The direct link between the service system and customers enables information sharing, product sharing, and service sharing to provide more efficient financial services.
The practice of blockchain technology development and application proves that in large-scale commercial applications, the alliance blockchain is most likely to become the mainstream architecture.

Central Bank Legal Digital Currency
Digital currencies with legal status, endorsement of state sovereignty, and subjects with issuance responsibility constitute legal digital currencies, or central bank digital currencies.
Central banks of many countries have long announced the launch of digital currency research and development. But regarding the basic structure of legal digital currency, countries are still demonstrating and have not yet made a choice.
The development of China's fiat digital currency lasted for 5 years, and there have recently been signs of preparation for issuance. According to the information disclosed by central bank officials, China's legal digital currency may be called DC / EP, Digital Currency / Electronic Payment, that is, digital currency and electronic payment.
First, adopt a two-tier operation delivery system to inherit the indirect issuance model. Applying digital technologies such as blockchain, fiat digital currencies can adopt the "central bank-public" direct issue model. In the direct issue model, the central bank can have the absolute power and ability to regulate the money market and can directly absorb public deposits, which will limit the initial credit capacity of commercial banks. If the indirect issuance model of the fiat currency "Central Bank-Commercial Bank-Public" is selected, it will inherit the current money market operation mechanism and monetary policy transmission mechanism.
The benefits of inheriting the current model are savings and robustness. First, it is not necessary to rebuild the financial infrastructure, which is conducive to saving investment; second, it is not necessary to restructure the currency issuance and management structure in addition to the old cloth, which is conducive to managing risks; third, it is not necessary to look forward and backward to connect different characteristics of the currency issuance model, which is conducive to stabilizing the market.
Second, adopt a parallel technical route and adhere to the central bank's central management model. Based on the judgment that "the existing blockchain technology cannot meet the high concurrent demand of the retail market in the super market", fiat digital currencies should remain technologically neutral and do not rely on a single technology. The central bank should adhere to a centralized management model to ensure the reliability of the monetary policy transmission mechanism, the efficiency of currency control, and prevent financial institutions from overspending.
Third, the "account loose coupling" method is adopted to replace the currency M0. Electronic payment tools such as WeChat Pay and Alipay use the "tight coupling of accounts" method. They need to be tied to a bank account and transfer value through the bank account. Under the real-name account management system, the need for anonymous payment cannot be realized. The fiat digital currency may adopt the method of "account loose coupling" plus electronic wallet, to achieve end-to-end value transfer from bank accounts, reduce the dependence of financial intermediaries on transaction links, and achieve controllable anonymous payments within the scope permitted by the central bank.
At present, the design of China's legal digital currency may be limited to replacing M0, that is, cash in circulation, rather than narrow money M1 and broad money M2. This depends on the judgment of the digital trends and potential market demand of China's M0, M1, and M2.
WeChat Pay and Alipay use digital technology to build mobile payment and living service platforms that use trust links as a link, breaking through the traditional payment model, and have achieved 1 billion straight-line links, ranking among the top 2 in global mobile payment platforms. WeChat Pay and Alipay dominated the retail payment market, with cash and ATM transactions significantly reduced, and bank cards became bundled account cards.
The legal digital currency in China's design can theoretically be separated from the network and from banks to perform value transfer. This is different from WeChat Pay and Alipay. But in the end, whether it can replace traditional currency forms, replace emerging electronic payment tools, and become the main currency form and main payment tool will be decided by the market: it is more convenient to use, the circulation cost is lower, and the public is willing to accept it, thereby forming an economic scale with commercial value .

Digital Economy National Strategy
The application of blockchain technology has extended to many fields such as digital finance, the Internet of Things, intelligent manufacturing, supply chain management, and digital asset trading. How to evaluate the current status of blockchain technology and industrial development? My opinion is that the underlying technology of the blockchain is not yet mature, and the technical bottlenecks of large-scale and reliable applications need to be broken. We are in the period of great opportunities for the development of blockchain technology and industrial innovation.
First, blockchain technology is still immature and bottlenecks need to be broken.
In the underlying technology, as a technology integration innovation, the basic components of the blockchain database, P2P peer-to-peer network, and cryptographic algorithms are relatively mature, but they must further meet the new requirements of integrated applications; new mechanisms such as consensus mechanisms and smart contracts Technology needs to be improved. Gartner, a technology consulting company, believes that it will take 5-10 years for blockchain technology to mature.
At present, large-scale applications of blockchain technology have not been implemented in various countries. China's blockchain technology research and development is committed to breaking through the bottleneck of large-scale reliable applications.
The first is private computing technology. Under the blockchain consensus mechanism, how to effectively shield sensitive information, improve signature technology, secure computing technology, encryption technology, trusted execution technology, etc., to ensure data security and digital link reliability.
The second is the authenticity supervision mechanism. How to ensure the authenticity and integrity of the data before the on-chain, when the blockchain technology is used to trace the source of various assets, a closed loop is truly formed to avoid information distortion and prevent speculation.
The third is smart contract technology. How to avoid technical loopholes in smart contracts, and achieve controllable business logic corrections and contract upgrades.
The fourth is key technology. Key security is the cornerstone of blockchain trust. In the unique technical structure of the private key, how to effectively prevent the private key from being stolen or deleted maliciously, and to remedy the loss and theft of the private key.
Fifth, integration of diversified technology platforms. How to optimize the multi-dimensional parallel interaction architecture to achieve efficient links between more participants; how to improve the quality and speed of data processing to achieve ultra-large-scale, high reliability, and high security requirements.
Second, implement the national strategy for the digital economy.
The attitudes and trends of developed countries on digital finance and digital economy deserve our attention.
The United States is concerned about digital financial market norms. The focus of US regulation is to regulate digital financial markets and prevent digital financial instruments from being used in illegal areas. In 2017, the U.S. Securities and Exchange Commission included ICOs under supervision, and the U.S. Commodity Futures Trading Commission approved the Chicago Options Exchange and the Chicago Mercantile Exchange to launch Bitcoin futures trading. In 2018, the United States Securities and Exchange Commission stated that the regulatory strategy for digital currencies is to use case law enforcement rather than a systematic interpretation of securities laws, and to carefully, orderly, and actively clarify regulatory principles and boundaries.
Germany and France are concerned about digital sovereignty. On October 29, 2019, Germany and France announced the "Gaia-X" project involving German and French core companies, which aims to build a secure and reliable data infrastructure for Europe. German Economy Minister Peter. Altmeyer said that this infrastructure will help us regain digital sovereignty and lay the foundation for a digital ecosystem. French Minister of Economy and Finance Bruno. Lemaire said the project will include data storage, data concentration and data sharing. German Chancellor Angela Merkel said that what worries me most is that most of the processing of industrial and consumer data is done by American companies, and a kind of dependency relationship is being formed. Merkel advocates taking a long-term view and digitizing the overall layout from as many European perspectives as possible.
We should implement the national strategy of the digital economy and maintain the security of the digital economy.
The first is to master autonomous and controllable technologies.
On the underlying technologies such as the blockchain consensus mechanism and smart contracts, China currently lacks independent property rights. Most of the application projects in China use the open source blockchain underlying platform for adaptive adjustment and development, and optimize from the number of concurrent users, throughput, response time, availability, security, etc., to meet business needs, to achieve identity authentication, privacy Protection, node management and other functions.
Extensive application of foreign open source programs may lead to technology dependence risks, and must comply with the jurisdiction and legal constraints of the place where the open source platform is registered, potentially hiding geopolitical risks. For example, the terms of use of the open source program GitHub clearly state that the use of GitHub must not violate export control or sanctions laws in the United States or other applicable jurisdictions.
We should vigorously support technological innovation and strive to master digital technology. Clarify digital technology and digital industry policies, grant tax and fee concessions to digital technology R & D enterprises and professionals, encourage digital technology R & D and application, national team plus private team, Chinese plus foreign capital, large, medium, small and micro. In the field, we have independent and controllable intellectual property rights and establish global competitive advantages in key areas of digital economy and digital finance.
The development of next-generation computing architecture should be intensified to ensure the fairness and correctness of mathematical algorithms, the privacy and reliability of data, the security of the entire process and the entire cycle of data, and the speed and efficiency of mathematical algorithms.
The second is to accelerate standardization and institutional innovation.
The International Organization for Standardization ISO has established a blockchain and distributed ledger technical committee to study 11 standards, including terminology, reference architecture, privacy and personal information protection, security risks and vulnerabilities. The International Telecommunication Union (ITU) has established a distributed ledger technology security-related problem group to study 10 standards, including security assurance, security threats, and security framework. The development of IEEE standards for the Institute of Electrical and Electronics Engineers is mainly focused on blockchain in the fields of IoT data management, digital asset management, government department applications, and cryptocurrencies.
China's blockchain financial standardization construction and institutional construction have just begun. We should pay close attention to improving the technical standards, security specifications, and certification review systems for blockchain finance. Clarify the legal definition of assets, clarify the contractual nature and effectiveness of smart contracts, and clarify the responsible subjects and their behavioral and regulatory standards in a distributed architecture.
Based on the healthy development of digital finance, China should speed up the construction of the digital financial system and step up efforts to formulate digital financial systems such as blockchain financial supervision, digital asset market supervision, digital currency supervision, and legal digital currency issuance. Make overall plans and gradually establish a digital trust mechanism.
Digital currency will occupy a core position in the future global digital economic competition. It is necessary to step up research on the feasible path and implementation plan for the issuance of China-led global digital currency. It is necessary to further explore the feasible path of China's legal digital currency, including alternative range selection, controllable anonymous scale, offline operation technology, and so on.
Digital finance is bound to further strengthen the globalization of finance. In the construction of the global system of digital finance, China should actively participate in and strive for the right to speak. It is necessary to strengthen international regulatory coordination, promote regulatory consensus, and establish a unified international regulatory standard for digital finance.
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Trending Crypto News Roundup September 2019

Trending Crypto News Roundup September 2019. Over the course of the month, we’ve come across news stories that created waves in the crypto field. NvestWeekly brings you the latest and most interesting hot news across the cryptocurrency and blockchain industry.
Here’s a brief overview of what happened on our watch list:
World’s ‘First’ Blockchain Smartphone “FINNEY”
The Swiss-based smartphone from Sirin Lab, known as FINNEY, is going to be one of the safest and most expensive smartphones to both store and use cryptocurrency in a mobile environment. However, the phones designed and manufactured by Foxconn Technology Group, a Chinese electronics giant. Also, for honoring bitcoin pioneer Hal Finney, the smartphone is named “FINNEY.”
Binance.US to Launch in Coming Weeks
Trending Crypto News Roundup September 2019. Crypto Global Exchange Binance.US said that it would launch in the coming weeks. The crypto exchange said that Know Your Customer (KYC) process will start a few days before launch, where customers can, however, have ample time before live trading to verify account and deposit funds.
The exchange claims that it is a fast, compliant, and secure digital asset marketplace. Also, it aims to provide best-in-class technology, speed, and execution of Binance to everyday users in the United States.
Stellar Development Foundation to Airdrop $120 Million XLM Crypto Tokens
The Stellar Development Foundation (SDF) has announced that it is launching a $120 million XML airdrop in collaboration with Keybase, an encrypted messenger. Likewise, it is the highest in the five-year history of Stellar, worth about $120 million.
Bakkt Warehouse Bitcoins Have Insurance Policy Worth $125 Million
Bakkt, ICE-backed exchange, has announced that the Bitcoin (BTC) deposited at the Bakkt Warehouse is protected by a $125 million insurance policy.
Insurance policy news covering customer deposits erases another concern that Bakkt hopes to lure for institutional investors.
Gemini Launches Regulated Custody Services
Gemini, owned by Winklevoss twins, has announced the custody service for 18 cryptocurrencies.
Although, the company has been providing custodial services since its launch on October 2015, they have considerably extended their range of products.
Currently, the company supports 18 cryptos for custody:
Bitcoin, Bitcoin Cash, Ether, Litecoin, Zcash, and the following ERC-20 tokens: 0x (ZRX), Augur (REP), Basic Attention (BAT), Bread (BRD), Dai (DAI), Decentraland (MANA), Enjin (ENJ), Flexacoin (FXC), Gemini dollar (GUSD), Kyber Network (KNC), Loom Network (LOOM), Maker (MKR), and OmiseGo (OMG).
Coinbase Announces USDC Bootstrap Fund For DeFi Protocols
Coinbase announced that it is investing $2 million in the USDC Bootstrap Fund to expand the Decentralized Finance (DeFi) ecosystem.
DeFi or Decentralized Finance is the latest trend in blockchain space. However, DeFi projects are traditional financial products that you would expect from a conventional bank. Also, it is built on top of a blockchain, such as loan protocols and derivatives.
Binance.US to Start Customer Registration Next Week
Binance announced that it would begin registration and start accepting deposits from next week on 18 September 2019.
The firm will provide updates on when trading is live for particular pairs shortly after registration opens. Also, the company is operated by BAM Trading Services and is based on Binance’s cutting edge matching engine and wallet services.
Mastercard, R3 to Work on Blockchain-Based Payment Solutions
Mastercard and R3, a leading provider of blockchain software, have announced a partnership to develop a new blockchain-enabled cross-border payment solution.
However, the initial objective is to focus on connecting the world’s faster payment infrastructures, schemes, and banks supported by Mastercard’s clearing and settlement network.
Domino’s Pizza Offers €100,000 Bitcoin Through Contest in France
Attention Pizza and Bitcoin lovers! Now, having pizza can make you own bitcoins worth €100,000. However, Domino’s France amazed their fans with an exciting offer by launching an ordering contest with a Bitcoin (BTC) or cash reward of $100,000 for the winner
Kakao’s Klay Cryptocurrency Debuts on Upbit
South Korean giant, Kakao’s “Klay” token, a native cryptocurrency, launched on Klaytn blockchain, is making its first official trade listing on Upbit platform.
Upbit is the South Korean fintech company Dunamu’s cryptocurrency global exchange. The crypto exchange supports more than 150 crypto assets.
Bitcoin ATM Network Coinme Secures Funding from Ripple’s Xpring
Coinme, the largest Bitcoin ATM network, announced that it had secured funding from the Ripple’s Xpring company for $1.5 million in a Series -A funding.
The funding indicates that Ripples XRP will quickly be accessible on the more than 2,600 ATM kiosks network of Coinme.
BlockFi Removes Minimums and Fees on BlockFi Interest Accounts (BIA)
BlockFi, a cryptocurrency company announced that it had dropped all the minimums and fees for its BlockFi Interest Account (BIA).
Additionally, BlockFi has also removed the early withdrawal penalty from the account and now offers all customers one free withdrawal per month.
That’s it for this week. For more exciting news, watch this space.
Seed CX Subsidiary Launches Crypto Derivatives Transaction
Seed CX subsidiary Zero Hash has announced the launch of bilateral crypto derivatives transactions.
As of now, the company will support all back-office settlement functions for forwards and have plans to expand soon. Also, this will attract financial institutions to settle derivatives on its platform.
That’s all for this week. We’re going to keep you updated with more interesting news to move forward.
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#PundiX Provides Recap of April 12 AMA with Zac Cheah, CEO #PundiXLabs

#PundiX Provides Recap of April 12 AMA with Zac Cheah, CEO #PundiXLabs

https://preview.redd.it/m0g557h3ses21.png?width=1366&format=png&auto=webp&s=7ed1595b3d46958b3cf86e5140e7f8f3769dc11e
Dear Pundians,
Thank you for participating in the AMA session with Pundi X founder and CEO Zac Cheah.
For those of you who may have missed it, the live recording of the AMA session held last on April 12 at 10:00 am GMT+8, tackling Q1 progress and addressing questions and concerns by the community members, can be viewed here:
https://youtu.be/PhHD3CwUyA8
You may also find a summary of the Q1 progress presentation as well as the Q&A below:

Pundi X Q1 2019 Highlights

  1. Pundi X ecosystem handled a total of 26,380 crypto transactions valued at 3.9 million in USD during the 1st quarter of 2019. Registered XWallet users have increased to 179,982 as of April 10. XPOS has been shipped to 30 countries.
(Correction: The 179,982 X Wallet users include both KYC verified and unverified users; and not all KYC verified users as mentioned in the video. Zac’s apology.)
Quarterly Transaction Summary
Distribution Map
  1. The custom XPASS cards are becoming popular among our XPOS distributors. Exchanges in Canada (iBank) and Africa (Bit2Big, DoshEx) have ordered 14,000 in total.
Distribution Partnerships
  1. XPOS has successfully received EU’s CE certification. FCC certification is under way.
XPOS Certification
  1. By integrating a collection feature, we are making XWallet a virtual mini-XPOS. Users can be part of the XPOS merchant network by becoming verified merchants from the XWallet app. Staking and conversion are also integrated into XWallet app and available for KYC verified users.
XPOS Handy, a more affordable version of XPOS, is now in production. 2,000 units will be produced. The team is also looking into expanding XPOS into traditional POS units platforms and has started working on one of the top two POS brands for integration.
Product Development Overview
  1. Due to the conversion, the token removal in 2019 will reflect the result of both NPXS / NPXSXEM utilization and NPXS / NPXSXEM conversion to FX. For example, the amount of Q1 token removal will be announced in the first week of May 2019 and the execution will take place in the second week of May.
2019 Token Removal Schedule

Below is a summary of the Q&A with community members.

On XPOS

  • Q: How many live working XPOS are there in the world right now? Understand the plan was 100,000 in 2021. But recent news is only talking about someone maybe buying 1000 in 2021.
  • Is the delay in scaling XPOS because of the licenses which Pundi X doesn’t have yet? If yes, when can we expect it to be approved or denied?
Zac: The pick up rate during Q1 isn’t moving as fast partly due to the bear market. Another contributing factor of which some of you may be aware, is that we have been working on obtaining the relevant FCC and CE certifications for the XPOS as it’s a requirement by most governments.
We are pleased to announce that the XPOS has been officially certified. It’s in fact the first blockchain based POS device that has been given the CE certificate. And with this, we will begin to accelerate to get the XPOS compliant with the different markets and increase the activation rate of the XPOS.
For example, in Dubai, we are working with the local credit bureau to apply for an approval with the local regulators using our CE Certificate as the base document. The same goes for Korea’s KC certification.
So yes, a lot of things have been moving behind the scenes and one thing that is clear is whatever we do, it is to play the long-term game. Hence, we had to make sure that we have all the relevant required certification for the XPOS before we take it to the next level of deployment.
  • Q: How many XPOS transactions (by coins) have been done so far (since the start)?
Zac: The XPOS and XWallet have handled a total of $3.9M USD in Q1 outbound transaction.
  • Q: Will there be a major partnership such as with Uber or Amazon to use the XPOS? Any strong partnerships in the works for the XPOS?Any upcoming big deals for the xpos ? Like Starbucks, etc? And did Pundi X ever get in contact with Kroger?
Zac: As always, similar to other business deals, due to confidentiality agreements, we do not comment on major partnerships until it’s firmed up or announced first by our counterparties. One thing for sure, we are working hard to engage established global enterprises (especially those) with a large distribution network and footprint.
In addition to that, we are exploring the expansion of our XPOS solution footprint by integrating the XPOS into one of the Top 2 point-of-sale manufacturers. We will share the process and details once we have completed the testing.
  • Q: Any updates on a Pundi X collaboration with Dubai government?
Zac: We are in the process of getting the XPOS certified with the local government authorities. And now that the XPOS has the CE certificate, it will accelerate the approval process in Dubai.
  • Q: When is the XPOS capable of handling credit card payments?
Zac: We have reached out to various parties that can provide and activate these services and that includes meeting the CEO of MasterCard, Mr Ajay, in person. He has seen our XPOS and from what I could tell, he was impressed.
  • Q: When will you add XRP to XPOS?
Zac: The XPOS is a digital currency-neutral device. When there’s enough demand and a real need from an organization or company, we would not hesitate to add it to our XPOS ecosystem.
  • Q: When will the XPOS have WePay, AliPay, Samsung and Apple pay?
Zac: XPOS itself is hardware-ready for these payment methods. To activate these services, we will be required to comply with the local regulations in different jurisdictions and work with the providers of payment gateways.
  • Q: Can we get a merchant map, similar to bitcoin ATMs?
Zac: The team is working on this. In the first phase, we will have a list of the featured merchants. We are targeting to have a “lite” version of this “featured merchant” map ready by end-May. We are finalizing the name but you can call it the X-MAP where you can locate your favourite XPOS merchants or X-Merchants.
  • Q: Does Pundi X have plans to support stable coins?
Zac: Our XPOS merchants already have access to the stable coin feature, but for regular consumers, the option to have stable coin is not available yet. However we foresee turning on this feature soon.
  • Q: China and Thailand should be supplied with XPOS via some partner. The news was big but that was over a year ago. What’s the status in these two key markets?
Zac: China’s stance against Cryptocurrency is still a no-go. The news that was mentioned a year ago refers to our license distributor called XPOT (they had a kick off event a year ago where Mr. Prachuab Chaiyasan, Former Minister of Foreign Affairs of Thailand was one of the attendees). XPOT is our licensed distributor and I believe they are still in discussion with the local governments and pending the environment to change.
Regarding Thailand, we are in talks; with possible partnerships in this market. Please stay tuned.
  • Q: What are the current legal issues Pundi X is facing in USA, Germany and Canada?
Zac: Regulatory bodies are still ambiguous about their policies toward cryptocurrencies. As previously mentioned, we will continue to monitor the situation in the different markets and be compliant so that as soon as there is clarity in the market, we will be in a prime position to move in.
  • Q: When is Pundi X expanding to India? I was at your Mumbai Meetup but we are still waiting
Zac: We are awaiting RBI’s permission too, as crypto is still frowned upon by the local authorities.
  • Q: A long time before the public token sale, at the pre-sale stage, Pundi X said they have a working product and simply needs the funding to pay for a huge production and then give out XPOS devices for free. The cost per device is somehow USD 200–300, depending on order volume and a USD 3,000 investment would yield a minimum of 10 XPOS Devices. After enough funds raised, the token sale got capped and more funds raised. Then the XPOS got remodeled and went for sale. What happened with the initial idea of giving 10,000+ devices out for free?
Zac: As previously mentioned, pre-public token sale participants who purchased > 30 ETH are entitled to a free XPOS. If you haven’t claimed yours, please reach out to us.
Also in the pipeline, we are working with some non-profit organizations to provide free XPOS for their usage.

On the XWallet

  • Q: Will you add a stable coin to XWallet?
Zac: Yes, we will. Someone has asked the same thing about XPOS. It will likely be added around the same time for XPOS, XWallet and XPASS.
  • Q: Can we add the bank transfers to XWallet? Basically to liquidate on the XWallet for sending money to my bank account?
Zac: This is my personal favorite feature to have and it’s on my wishlist. In order to support fiat, we need to have a Payment Service License / E-Money License / Stored-value license in a jurisdiction that supports a particular fiat. For example, if it’s EURO, we will need to apply for a license or lease it via a partner for this to work.
We are definitely exploring the different possibilities but we are unable to elaborate more on when, or if it is happening, as this also requires more talks with the different local jurisdictions.
Q: Turkish holders would like to ask when can we partner with master / visa and integrate with XWallet?
Zac: As mentioned earlier, we have reached out to various parties that might be able to activate these services.

On Q3 to Q4 Plans

  • Q: What’s the plan for Q3 and Q4 for this year?
Zac: There are tons of things we are working on for Q3 and Q4.I will broadly separate it into:
Developer ecosystem — The developer ecosystem allows traditional and tech companies to onboard themselves into the XPOS and XWallet ecosystem, such as listing of their custom tokens, advertising etc. These services will all require the usage of NPXS and NPXSXEM tokens.
Partnerships — We are likely to partner with incumbent retail chain stores payment companies, incumbent POS companies that have deep distribution network to help expand the reach of XPOS, XWallet, XPASS, etc.
Governmental level efforts — We started off with Dubai and since then, several other governments have shown interest. We see this as an opportune time to engage forward-thinking governments to build a blockchain ecosystem in their city and country.
Our Team: we will continue to invest and grow our R&D team capabilities as they represent the heart of Pundi X. If any engineer or developer is keen to help us to scale, please get in touch with us. We are actually looking for engineers as I speak.

On NPXS and Token Removal

  • Q: What is the quarterly token removal from the NPXS usage of the XPOS and the burned amount for Q1 2019.
Zac: Good question. Some holders may be aware that token removal includes the result from the conversion. The amount of Q1 token removal will be announced in the 1st week of May and we will execute the removal in the 2ndweek of May.
  • Q: Pundi X has mentioned a monthly coin burn and a monthly buy back. Why hasn’t this happened yet?
Zac: It is not monthly. We are doing a quarterly token removal.
  • Q: People feel that the current token burn isn’t as transparent as many wish. What can be done to improve this process and make it more transparent? The biggest upset was after the ULTRA festival where Pundi X just wrote “we ain’t allowed to talk numbers.”Could there be a daily or weekly ticker? Is that possible?
Zac: That’s a good suggestion. While a daily ticker might be challenging, we certainly can try exploring incorporating a ticker update towards all token removal or scheduled for the next one.
  • Q: Zac, you have mentioned previously that someone was trading against NPXS. What did you guys do about this problem?
Zac: There are trading teams, market makers, financial institutions that profit from the drop and rise of token prices in the crypto market and it’s not something that is unique to NPXS. In fact, the traditional stock markets have similar challenges as well. We have taken the “the best defense is a good offense” strategy which is to continue to strengthen our tokens; such as create more use cases, drive more adoption and more distribution to ensure our tokens are well positioned and stronger than ever.
  • Q: Why do you not do any great marketing and generate publicity for NPXS, e.g., advertise on television stations in major and in different countries? I generally see marketing as very important to the company’s success. And I hope to see real partnerships, not just with small shops or restaurants.
Zac: We rarely engage in paid partnerships as it doesn’t necessarily produce the best ROI in terms of investment and in this market condition, we believe in being financially prudent. Being in a decentralized environment, we consider ourselves as a community-driven company.The impact of organic press coverage driven by our community is always stronger. We do want to be seen on all major news channels and we will do that via “thought leadership brand building.” As a testament to our growing reputation, recently, we were invited to speak at the Fintech Ideas Festival event and be on the same stage as the senior executives and CEOs of Wells Fargo, COO and CTO of Bank of America and other large institutions. We see this as the right step forward in growing our brand appeal to the masses.

On the QEX Fund

  • Q: Any update on the QEX fund?
Zac: The QEX fund is led by Vic Tham,CEO and Fen Chao Yong, COO, at Quantum Energy Asset Management, also known as QEAM. Other than being the CEO of QEAM, Vic is also Pundi X’s Chief Investment Officer.
From what we know, they are in the midst of raising funds, book building, analyzing potential projects & companies and strengthening the portfolio for QEX. It’s an ongoing effort for this year and a very exciting one. We are extremely excited to see potential breakthrough projects that could benefit our ecosystem. And if anyone has questions or interests, please do reach out to Vic Tham and his team at QEAM.

On Function X

  • Q: What is the update on devs program for the Function X ecosystem?
Zac: Many keen developers are eagerly waiting for it, and I know Billy who has posted this question is one of them. We are working on it right now, we can’t commit on the dates yet but developer support is a big part of our ecosystem. We are working tirelessly, and sometimes “sleeplessly” to get this out.
  • Q: Did you use “investors”/ token holders funds to develop Function X? And instead of giving the 65% FX tokens to NPXS and NPXSXEM holders, you are getting them to choose between NPXS/NPXSXEM and FX token?
Zac: 65% of the FX tokens from Token Generation Event (TGE) is already allocated for NPXS / NPXSXEM token holders, via staking and/or conversion. There are two separate projects with teams working on it. For the XPOS ecosystem to flourish, it requires a more scalable platform/solution which is the Function X ecosystem.
The Function X foundation will be announced in Q3 and hopefully it will be a pleasant surprise. We will have a solid team to grow the Function X ecosystem.
  • Q: Will Pundi X be less focused on NPXS once FX goes live?
Zac: No, we think it’s mutually beneficial. If I may use an analogy, it’s like Google Search and Android, one product will lift the other up. The other example would be salt and pepper. When used in combination, it will drastically improve the taste of any particular dish.
  • Q: What is the relationship between the future f(x) coin and the future NPXSFX token? Is the former used in the FX ecosystem (XPhones) and the latter used in the XPOS ecosystem? If so, would buying something using the XPhone going to burn FX coins, NPXSFX tokens, both or none?
Zac: Think of the role of f(x) coin like how ETH is. Everything or any service that’s taking place in the Function X ecosystem will require the f(x) coin.
For NPXS which will be ported over to the Function X blockchain once the Function X mainnet is up and running, its utility will remain the same. Any payment-relevant services or activities on the Function X blockchain will require NPXS, which on the Function X mainnet will be tentatively called NPXSFX.
  • Q: For FX Tokens, the lock up of 1 year is too long for us to wait. Can we change the option to shorten the duration?
Zac: The mechanism in place has been designed for the long term, so unfortunately, we can’t change the option. Users have the choice whether to convert his NPXS and NPXSXEM, or not, into f(x) coin, if a user chooses to convert he will receive 12% immediately and 8% each month for the next 11 months.
  • Q: Will F(x) be available to those who couldn’t stake or convert? Will it be before the staking period end or after? When will F(x) be available to purchase on an exchange for those in countries who were not allowed to stake? Will it be during the staking period or after?
Zac: Soon we hope. As per our policy, we are unable to comment on listing dates, but with our established relationships with exchanges, we do hope it will be quick.
  • Q: We were all impressed by the Uber Dapp demos running on F(x), but these days Tron and EOS are getting a lot of press about Dapps too. What advantages will F(x) have over those platforms?
Zac: Each platform will have its own advantages, we welcome the competition and hope that more popular apps such as the decentralized Uber app can be conceived from Function X.
  • Q: Why is there no cap on f(x) tokens? When will you explain how the tokenomics will work?
Zac: I would encourage all to have a look at our concept paper on functionx.io and the Medium blog post as the details are explained thoroughly there.
  • Q: Have you already secured deals with other companies like Sony, Samsung, etc with the Function X OS to build other blockchain phones? Or do you plan to keep the Function X software to just the 5000 phone you already made?
Zac: The 5,000 XPhones serves as a proof-of-concept, for manufacturers and developers to have a test drive. We want to partner with hardware/smartphone companies and telcos to build their own version of the blockchain phones with Function X. And we are still working hard to engage with the companies to push for future blockchain phones and strengthen our Function X ecosystem.
  • Q: Will the XPhone work as a mobile point-of-sale (mPOS) device like the XPOS Handy?
Zac: The XPhone comes preinstalled with the XWallet and with that, it can double up as a lite version of the XPOS with QR code and NFC Support.
  • Q: When will XPOS Handy be ready?
Zac: XPOS Handy will be available in the coming weeks.
submitted by crypt0hodl1 to PundiX [link] [comments]

What Billions in Fed Repo Injections Reveal About the Promise of Bitcoin

What Billions in Fed Repo Injections Reveal About the Promise of Bitcoin


Article by Coindesk: Michael J Casey
Last week, the Federal Reserve injected $278 billion into the securities repurchase, or “repo,” market over four days, all so that banks could meet their liquidity needs. It was the first time the Fed had intervened in this vital interbank market, where banks’ pawn financial assets to fund overnight cash needs, since the financial crisis of 2008.
Fed officials and bankers dismissed the rare liquidity breakdown as a hiccup stemming from a series of coincidental factors in bond markets and corporate tax payments. It wasn’t a very comforting explanation, not when other economic warning signs are flashing, too: $17 trillion in bonds worldwide showing negative yields; a worsening U.S.-China trade war; and manufacturing indicators signaling an impending global recession.
Predictably, certain crypto types have viewed this alarming scenario with glee. More than a few HODLing tweeters responded to the repo story with two words of advice: “buy bitcoin.”
But it’s actually hard to predict what all this means for crypto markets, at least in the short- to medium-term.
If and when a 2008-like financial panic takes hold, will bitcoin rally as a new kind of uncorrelated “safe haven” or will it decline in a broad-based “risk-off” dumping of all things speculative? (Notwithstanding a sharp dip and rebound midway through last week, bitcoin has proven quite stable of late, at least by its own volatile standards.)
Other questions: do these vulnerabilities in traditional credit markets highlight the promise of new blockchain-based ideas? For example, would wider use of security tokens allow speedier settlement and, by extension, reduced counterparty risks and greater market confidence? Or, far more radically, would MakerDAO’s on-chain #DeFi lending markets enable a more reliable clearing mechanism, with collateral calls locked in by a decentralized protocol? Or might these underdeveloped ideas simply be recipes for systemic risk, a single hack or software glitch away from setting off a vicious spiral of collateral calls and bankruptcies?
The jury is out on all this untested stuff.
Still, if nothing else, the many signs of stress in the traditional financial system offer a valuable framework for thinking about how the world could be different and the role blockchain technology might play in enabling that new world.
Let’s look at some of them:

Negative-yields

The rare phenomenon, where creditors are essentially paying issuers for the privilege of lending them money — head scratcher, right? — reflects excessive demand for “safe” assets, especially for government-issued bonds. It has historically been a strong indicator of impending recession, since it reflects an overwhelming reluctance among investors to take on risk.
Now, another way of thinking about that reluctance is to express it as a perceived shortage of good investment opportunities. That perception can be fueled by a worsening economic outlook, but it’s also dictated by the barriers to entry that make it difficult for otherwise investable businesses of offer new opportunities.
Here, certain blockchain-based credit ideas offer hope. There’s the prospect for distributed-ledger asset registries that better track collateral and enable new emerging-market lending in developing-country land, commodities and energy markets. Or there are ideas such as having exporters tokenize their receivables to tackle a major structural limit on global trade finance, where a majority of small-and-medium enterprise are denied letters of credit because bankers don’t trust their documentation.
Effective use of blockchain technology could boost trust in assets and lien registries and help bring to life the $20 trillion in “dead capital” that economist Hernando de Soto says the world’s poor are sitting on.
Just as importantly, it would open a world of new alternative assets to draw in investors’ capital, giving them less of a reason to park it in low-yielding bonds.

Global economic slowdown

An alarming, synchronized downturn in manufacturing indicators, most notably in purchasing manager indexes, which measure current and future business spending on inventory and equipment, flows directly from the U.S.-China trade war. In cutting off Chinese goods exporters from U.S. consumer markets and driving up costs for their U.S. importers — and vice versa for U.S. farmers selling to food distributors in China — the conflict has added a massive new burden on global economic activity.
But let’s look at the starting point for this trade battle. It lies in American companies’ mostly legitimate complaints about China’s mercantilist, centrally planned approach to supporting Chinese companies at their expense, all enabled by a system of surveillance and control over people and businesses. This where there’s a crypto angle.
Cryptocurrency and other decentralizing technologies could work against the Chinese government’s capacity to control its economy in this interventionist manner. If Chinese businesses and hundreds of millions of Chinese citizens used bitcoin to circumvent capital controls, for example, the ever-present risk of monetary flight would act as a pressure valve, compelling Beijing to pursue a more open economic model to maintain competitiveness. That would give anti-free-traders like President Trump less of an excuse to ratchet up protectionist attacks against it.

The repo intervention

Some innovators have sought to apply blockchain technology to the back-office structural problems that periodically roil money markets, such as those now manifest in repo. They see a distributed ledger as a superior mechanism for tracking the IOUs of money and pawned securities upon which inter-institutional credit markets are based.
One was former J.P. Morgan credit market maven Blythe Masters, who founded Digital Asset Holdings in 2014 on the idea that on-chain settlement and a universally auditable ledger could improve transparency in global finance’s opaque, complex matrix of interconnected credit relationships. This way, she argued, it could mitigate the mistrust and counterparty risks that fueled the financial crisis.
The DAH model and those of others working on back-office blockchain solutions for capital markets have not come to fruition. This is at least partly due to the reluctance of incumbent financial institutions and their regulators to kill off existing functions that a blockchain would make redundant; they instead designed cumbersome hybrid distributed-ledger models that sustained vested interests but were expensive and difficult to collectively implement.
Either way, a blockchain back-office fix for traditional finance isn’t coming any time soon — whether because of internal politics or the limitation of the technology.

Shining a light

A more important question is why we even tolerate a system that’s so vulnerable to those back-end markets’ problems at all. The only reason central banks ever intervene to support interbank credit markets is because society’s means of payment depends on avoiding cash shortfalls and maintaining confidence in fractional-reserve banking.
If banks don’t have enough cash to meet short-term creditor calls, they would suffer runs on their deposits, companies wouldn’t make payroll, tenants would have to skip rent, ATMs would run out of banknotes, etc. The economy would seize up. The worst of it is that, because of this ever-present threat, banks hold our political system to ransom, knowing that they can always rely bailouts: the too-big-to-fail problem.
But what if banks just stuck to longer-term lending? What if there were no checking accounts or debit/credit cards, and we simply exchanged value with each other via cash or digital currencies that we hold ourselves?
If people used bitcoin, or fiat-backed stablecoins or central bank digital currencies to exchange value instead of the IOUs of an inherently fragile fractional reserve banking system, institutional cash shortages simply wouldn’t matter as much. Banks’ biggest creditors might take a hit against their risk-adjusted positions and their stock prices would fall, but the rest of us, including the Fed, could ignore the problem.
As the journalist and commentator Heidi Moore astutely observed in a tweetstorm last week, the reason the repo market tumult is so worrying is because it speaks directly to the core problem of trust in the banking system.
If nothing else, this is where blockchain technology provides a valuable lens with which to assess the current stress in the financial system. It helps us think about how the trust problem creates vulnerabilities, power imbalances and systemic risks and how we might design a system that’s better able to resolve it.
Federal Reserve image via Shutterstock
submitted by GTE_IO to u/GTE_IO [link] [comments]

Why Korea and Bithumb are still bullish since the beginning of 2018. Add ICX into the mix and imagine the possibilities.

I’ll be honest ICX makes up about 1% of my portfolio. I was crazy salty having missed the ICO when I was going to put 20% of my portfolio in for investment ... oh what glory that would have been. I’m tied up in ICOs and missed this train already, but prepare for more pumps based on UpBit listing and all the other top exchanges in Korea aside from CoinOne (I don’t know why, this is what I heard from our little birds.)
Now... I just want you guys to make some connections with previous news about Bithumb and ICX and then put two and two together.
Bithumb ATMS: https://twitter.com/cryptoofkorea/status/971455112295038977?s=21
Last month, Bithumb partnered with three kiosk manufacturers – Uno Space, TROS Systems, and IYU. These firms supply kiosks optimized for small businesses such as food and beverage franchises, small restaurants, and cafes.
The platform offers over 50,000 accommodation facilities like hotels, inns and campers. The platform may support 12 cryptocurrencies including: Bitcoin, Bitcoin Cash, Ripple, Ether, Ethereum classic, EOS, qtum, Monero, Litecoin, ZCash, Bitcoin Gold and Dash.
NUMBER 13... ICONNNNNEEEEECCCCTTTTTT.
Bithumb Partners with Major Online Shopping Malls: https://twitter.com/cryptoofkorea/status/957760622128697345?s=21
They are also kicking off the launch of their Bithumb Pro exchange by listing ICON. What is Bithumb Pro? Think GDAX for Coinbase.
Bithumb is clearly trying to reposition themselves as the number one exchange within Korea as they intend to climb back as a top market player here not only with transactions, but also helping crypto use cases. UpBit has been slow to act on this front, but I’m sure they have many things up and coming to compete with Bithumb over.
What we need as a community, the Blockchain community behind our desires for money, is actual utilization of these technologies. We are speculating on decentralization. If you’re here for both let’s remember the end goal... lambros before green doughs. (Steps off pedestal.)
Korea is definitely bullish on crypto, and this FUD market since January is coming to a close as the curtains are being pulled back on all the action that’s been taking place behind the scenes as major players accumulate.
submitted by CheslinK to helloicon [link] [comments]

[DISCORD CONV.] Can't help falling in love with IF

5/2
David Sønstebø - Today at 2:33 AM @Dusty Word, world leading companies on boarded weekly, cutting edge tech being released monthly, top talent hired bi-daily. IOTA is moving so fucking slow
David Sønstebø - Today at 2:39 AM I am refurbishing and renovating my whole house atm. and even just basic shit like painting a room where you know exactly the square meters, how much paint you need, you know exactly how much floor you need etc.
David Sønstebø - Today at 2:39 AM You can time it in your head, but reality will kick in and some uncertain variable will cause a delay
David Sønstebø - Today at 2:40 AM I was mounting my TV on my wall the other day and had the screws necessary, but they were 1 ( !!!! ) cm too short, which postponed it a whole day
Bambiota - Today at 5:26 AM When AMA?
leechi - Today at 5:26 AM david, can fake people stop real shit?
David Sønstebø - Today at 5:27 AM @Bambiota AMA will come in May, but there's sooo much lined up, so we want to get a few big announcements (including Ecosystem) out before, so everyone has some meat to tenderize for the Q&A @leechi Only temporary.
Apache Sidewinder 🚁 - Today at 5:26 AM David what's your favourite Guns N Roses song?
David Sønstebø - Today at 5:27 AM @Apache Sidewinder 🚁 Hmmm, good question. Probably Slash's guitar solo in Estranged
5/3
travel! - Today at 2:47 AM @David Sønstebø , is MOBI the only few « big » announcement before AMA ?
David Sønstebø - Today at 2:48 AM no....
David Sønstebø - Today at 3:19 AM With CRISPR gene-data traded securely over Tangle will become a reality
David Sønstebø - Today at 3:24 AM The thing is, once you get all of these meta-telematics data secured, you can sell them to other producers, including the gene fenotype, so they can reproduce the yield and quality The data will be very valuable
David Sønstebø - Today at 3:28 AM @yoda beautiful, agritech is high on the IOTA agenda
Hapa Haole - Today at 3:41 AM @David Sønstebø Since one of IOTA's strong points is Data integrity with sensors etc, are you guys receiving any backlash from companies that...like to lie and don't want to be invovled in that since a lot of big companies are corrupt lol?
David Sønstebø - Today at 3:42 AM @Hapa Haole Nah, I get the question though. However, this is a reality that is coming whether the entity likes it or not, by opting out you make yourself the target of suspicion
t00k - Today at 3:43 AM @David Sønstebø Okay if I PM you about a company in Sweden? Worked there before and have some connections left.. Want to set up something.. Or talk to someone else?
David Sønstebø - Today at 3:44 AM @t00k that'd be nice, we got some shit going in Sweden as you know (hint hint eKrone)
not batman - Today at 3:44 AM @David Sønstebø seriously? the swedish national crypto?
David Sønstebø - Today at 3:46 AM @not batman Actually it's good, it gives me TV and sound I can't provide any official update on eKrone yet, just that it's still ongoing
Alebu - Today at 3:54 AM David are there plans for an IF office in Switzerland?
David Sønstebø - Today at 3:54 AM @Alebu Not right now. Oliver Bussmann being president of Crypto Valley there and being part of IF is sufficient for now
matin619c - Today at 3:58 AM @David Sønstebø The United Arab Emirates (UAE) has launched a ‘UAE Blockchain Strategy 2021’, aiming to conduct 50% of government transactions at the federal level using blockchain technology by 2021. Great to see today IOTA as part of MOBI initiative announcement at Future Blockchain Summit in Dubai. Appreciate if IOTA is made available on BitOasis exchange - the only reliable exchange in Middle East for United Arab Emirates, Saudi Arabia, Kuwait, Bahrain, and Oman to enter with fiat.
David Sønstebø - Today at 4:00 AM @matin619c you got a connect? We don't tend to reach out to exchanges, we leave it up to them
Sebastian - Today at 4:03 AM @David Sønstebø How is the audit of the wallet progressing
David Sønstebø - Today at 4:03 AM @Sebastian Very well
northernwhale Sidewinder - Today at 4:27 AM @David Sønstebø David! Do you have plans to change the iota logo at all ? I'm thinking of making something that will cost a fair amount from my pocket and want it to age well. Nda response is fine too x
David Sønstebø - Today at 4:28 AM @northernwhale Sidewinder I think the IOTA logo is already timeless. I see no reason for changing it.
w4lker - Today at 4:31 AM Anyone knows who came up with the design for the iota logo?
David Sønstebø - Today at 4:43 AM @w4lker me and another designer
5/4
Bernie Sanders - Yesterday at 11:25 PM Is there any plan for a laymans write up of how Q works, I think it would help a lot. Because right now Qubic is just a list of stuff that was on the roadmap
David Sønstebø - Yesterday at 11:26 PM @Bernie Sanders Wait until the date, then all of these things will come, yes
timvanhelsdingen - Yesterday at 11:26 PM there is a lot of EUUSD stuff in teaser, seems like the “after Q you dont need to go into fiat” wasn’t a joke
Eric Hop - Today at 1:22 AM Remember Star Trek? Q was omnipotent!
Qgelfisch - Today at 1:35 AM @Come-from-Beyond why smart contracts still in progress on your twitter bio?:
Come-from-Beyond - Today at 1:36 AM That text will be changed by a qubic
Eric Hop - Today at 1:37 AM Every day is a good day when you can work at IOTA
Come-from-Beyond - Today at 1:37 AM [is today a good day?] that kind of questions will be answered by Qubic oracles [Will IOTA's smart contracts be as powerful as Ethereum's smart contracts?] no much more powerful :
Eric Hop - Today at 1:38 AM Since when are ETH contracts smart?
Eric Hop - Today at 1:41 AM Can't airdrop what has already been distributed completely Our vision for IOTA is that everything and everyone uses IOTA as preferred coin. It's silly to build on top of IOTA and not use the built-in fee-less token.
CryptoSufi - Today at 1:44 AM So computational work is valued in iota
Eric Hop - Today at 1:45 AM Everything is. Why would you want to deal with exchange rates?
Eric Hop - Today at 1:52 AM In 30 days you will be able to come up with your own use cases. Qubic will be yet another tool for the community to come up with awesome solutions like IOTA, Flash, MAM, etc.
Come-from-Beyond - Today at 2:33 AM [wee gonna be rich] i doubt, most will sell at 1/10 of the real price
Come-from-Beyond - Today at 6:46 AM [Asia waking up?] No, it's just people expecting that Asia is waking up. Wait for real Asia.
Eric Hop - Yesterday at 2:01 AM Read David's announcement text if you want food for speculation.
Eric Hop - Yesterday at 3:49 AM https://medium.com/bethereum/how-oracles-connect-smart-contracts-to-the-real-world-a56d3ed6a507 ETH based but the general sentiment is the same
MrWiggles - Yesterday at 4:50 AM I thought iota is for interoperability, not for killing other Coins
Eric Hop - Yesterday at 5:03 AM It's called collateral damage. Or desired side effects
Eric Hop - Yesterday at 5:19 AM @Mark Thanks. Like I said it was hard to contain our excitement and not fuel the hype constantly knowing that the hype did not do it justice. We haven't even begun to explore the possibilities that Qubic will open the community up to yet. There will be killer apps that no one have even thought of yet. I expect a similar organic growth like happened with the Internet and such. It's like crypto all over again. Provide people with a new toy/tool and see what they come up with. Just as long as it's not ICO- or kitten-based
Eric Hop - Yesterday at 5:36 AM I never speculate on price. The only thing that seems sure is that price will go up. Demand for iotas will start driving the price at some point.
Eric Hop - Yesterday at 5:37 AM Price is nice. But it's about the new tech and what that enables us to do for humanity. Wouldn't it be nice to decentralize the shit out of conglomerats, banks, and government?
Eric Hop - Yesterday at 5:41 AM Like I said. It was hard to balance the excitement with not wanting to fuel the hype
Eric Hop - Yesterday at 5:42 AM And actually, nothing has changed in that regard. You guys will now speculate wildly with the limited new information and already I've seen outlandishly off ideas, and some people get really close.
eremal - Yesterday at 5:47 AM Yeah pretty much, but temperature sensors over an area as big a city might be a challenge. Im thinking more of how the overlaying consensus mechanism of the Tangle is that a transaction is confirmed when all nodes on the network has verified it indirectly or directly. The verification is done by each node checking their ledger if the transaction is possible or allowed. Now imagine a set of nodes having a sensor that tells them wether info X is true or not. And then you collect all these nodes into a consensus structure. You ask these nodes if X is true by issuing a transaction, and once all these nodes has confirmed it you can be positive that it is true
Eric Hop - Yesterday at 5:49 AM See? You have been thinking about this already! You're pretty much describing Oracles (the sensors, that post real-world info) and a smart contract that integrates the data into a result.
Eric Hop - Yesterday at 6:10 AM @shieeet The fact that you have thought about this should be a hint that other people may have done it as well. Especially the people trying to make this happen. That being said, I always love this kind of input, because there is no guarantee we haven't overlooked problem areas. We're as human as anyone else and make mistakes. So by all means keep throwing stuff like this towards us and we'll incorporate it into our solutions. There are a bunch of developments underway to lower the bar for participating in the network, and to come up with great incentives to participate. The problems are very visible. The solutions will take time to test and implement. This is an organigc process that will take time. Look at what Bitcoin had to overcome and after all these years it has hardly progressed beyond a speculation vehicle. In fact it has lost terrain as a payment system due to the fees. Now everyone in that space it trying to solve that problem. We see similar things happening with IOTA. We removed certain blockchain limittions by designing a completely new system, but that one of course has its own new limitations. One that everyone is going to bump into is network bandwidth for example.
Pitbullworkout - Yesterday at 6:17 AM @Eric Hop you've said a couple of times to read between the lines in David's announcement. I'm guessing JINN and possibly a third advisor to IF from large chip manufacturer?
Eric Hop - Yesterday at 6:17 AM We cannot reveal more at the moment, or we would have. We will reveal when we are ready to. Which is planned for June. But we also wanted to give you guys at least soemthing for the time being. Hence this teaser announcement.
Eric Hop - Yesterday at 6:19 AM We know from past experience that any news in crypto is short-lived. Tomorrow could bring another FUD article. We are not focused on that. We are focusing on getting shit done. And we want the community to share our excitement.
Eric Hop - Yesterday at 6:23 AM If you know your token value will multiply due to what you're building anyway, would you be selling right now? We don't need to pump the price. Once IOTA takes off demand for tokens will skyrocket. So we focus on making sure IOTA takes off.
Eric Hop - Yesterday at 6:27 AM Here is another instance of where you could solve a perceived problem as a community member. Just start thinking out of the can't-do-timestamps box and come up with a solution that makes timestamps a reality or unnecessary.
Eric Hop - Yesterday at 6:29 AM In my experience, saying 'this can't be done' you are always right. You won't be able to do it. And then someone who does not say that line comes along and does it anyway.
ZenJourney - Yesterday at 7:46 AM As someone working in a analytics, how can I prepare best to fully utilize Q?
paul douglas - Yesterday at 7:59 AM I probably can't say about how to prepare without violating the hush policy
Eric Hop - Yesterday at 11:29 PM Here's another hint: we revealed 3 things about Qubic. You guys only discuss 2 of them.
Yellow - Yesterday at 11:29 PM I wrote a small piece about my thoughts on Qubic. Would love to get some discussion going on: https://www.reddit.com/Iota/comments/8gzk7u/qubic_potential_impact/
Eric Hop - Yesterday at 11:39 PM Seriously, by far the best write-up I've seen out there so far. No weird speculations and everything thought through brilliantly.
Eric Hop - Yesterday at 11:44 PM You've taken the few things we gave you and thought them through without going off on wild speculations and turned it into a coherent story. Very impressive. This article should be basic reading for everyone interested in Qubic.
Eric Hop - Today at 12:15 AM We've already indicated in the past that IOTA is building protocols for IoT that are supposed to become the standard. Look at IOTA itself. It's very basic. Yet the community and IF members have come up with interesting protocols on top of that to make it more interesting. MAM, Flash, cheques, aliases, etc. And now Qubic. I see the same thing happening there. Give people a new toy to play with and they will come up with things you never even envisioned.
Eric Hop - Today at 12:17 AM Of course. We make stuff for you guys to play with. It's community effort, permissionless innovation, that will create wonderful stuff. Just look at what Semko is doing with Carriota for example.
Eric Hop - Today at 12:17 AM Our task is to provide secure, working, scalable protolcols.
Eric Hop - Today at 12:18 AM That's why I always compare it to the early internet. You had TCP/IP to play with. Then someone came up with HTTP on top of that. Later someone put HTML on top of that.
Eric Hop - Today at 12:19 AM IOTA is TCP/IP. Qubic could be HTTP or even HTML. I don't kow yet.
Eric Hop - Today at 12:19 AM And just as with the internet it will be gradual and organic growth.
Eric Hop - Today at 12:24 AM I actually created the original web page for the qubic teaser. With my 6-year old web app development skills. At that time you would test against all major browsers on desktop and no one even considered mobile. So I made the mistake of using my old skills and forgot to test on mobile. Luckily Edward caught me on that. So they converted the page to a more modern version. I was blown away by how many things changed in those 6 years. The JS they used was almost unrecognizable. This is what I see happening with IOTA, with MAM, with Qubic, etc
submitted by btlkhs to Iota [link] [comments]

Why Decentralization is a naive dream, why BTC cannot achieve it completely, why Satoshi Nakamoto may be a Intelligence Service creation and why it all may be a good thing. Plus some warm and fuzzy philosophy at the end.

Hello everyone. I am new to reddit and have created this account to hear your thoughts on the topics that I am now going to present to you. I really like cryptocurrencies and blockchain technology as a whole, but I am increasingly disillusioned by some interesting facts that I had not thought about until now. I would love to hear from you and learn from your responses and insights. Have fun reading and all the best to you.
Concretely, I want to discuss: (1) The theory that true decentralization is a naive dream because of the physical infrastructure that underlies all web-based transactions and which is being controlled by the exact elite Bitcoiners aim to disrupt. (2) All web-based protocols and also BTC run on top of hardware that is in the hands of highly centralized companies and Internet providers that collect personal data all the time. (3) BTC cannot decouple from the current financial system because the growth of the BTC-Network requires capital, which in turn favors those who possess the investment-power a.k.a. the already rich.
(4) The highly unlikely theory that intelligence services neglected the danger BTC poses to the current financial systems and its masters. I want to ask how it can be possible that the entirety of intelligence services (who had an eye on the dark web from the beginning and must have known about BTC and its disruptive potential) have failed to foresee the danger it poses to the empire of the dollar and their masters?! They didn`t IMO and I`m playing with the thought that BTC has been introduced by some financial elite as a test environment to make people become accustomed to the idea of digital currencies for later introduction of crypto-dollars. It would explain the anonymity of Satoshi for once. Also, it would only make sense because you have to accustom the masses to new ideas and let them get a taste of it before you spend countless billions on resources and processes on something that has been completely unknown up to this point. Just imagine how we would have reacted if Amazon or HSBC suddenly declared that from now on they will only trade something called Crypto-dollar?! It would have resulted in a hard rejection imo and would have pushed back the introduction of cashless societies many years.
But for now, let me begin by stating some obvious facts about the physical infrastructure that is needed in order to keep the interweb and the BTC-network running and why it actually serves the centralized powers most and is therefore far from decentralized.
  1. Some people seem to forget that each and every digital transaction is still hosted by some form of hardware. Be it actual servers, undersea cables, satellites, your PC or mobile phone or the mere electricity supply coming from electricity plants, the interweb and also the bitcoin network is fundamentally relying on these essential hardware components. Let me ask you: who controls this hardware? All of this infrastructure is far from being decentralized. It is being controlled by elitist, centralized companies all wanting to maintain their power and control for the sake of future profits and influence. Prove me wrong.
Saying that BTC is decentralized is like saying that cake can be made without flour, butter and eggs (no, you cannot post a vegan recipe here). There is always a need for physical resources and the BTC network is no exception. And since this physical infrastructure is more fundamental to BTC than BTC itself and since these physical hardware components are being manufactured, controlled and tied to dollar-based industries of centralized companies BTC is essentially relying on the very systems of centralized powers it aims to decouple from. Also, this fundamental physical infrastructure upon which BTC runs is upheld not by BTC but by national currencies such as the dollar. And since it requires dollars to build, run and maintain the physical infrastructure of the BTC network it is those who posses the most dollars who have the most power over it. (more on this topic on point 4) Am I wrong here guys?! Please enlighten me.
  1. Furthermore, when it comes to the internet internet itself, which is the digital infrastructure of the BTC network and acts as its access point, we are all relying on internet providers and PC`s themselves, which are all in the hands of multinational companies that have been proven to collect our data. Remember, the internet itself is an invention first created within large corporations and has then been adapted and refined by the military. Who controls, stores and regulates the majority of internet traffic in nuclear bunkers and high-security warehouses all around the world? Certainly not us bitcoiners. Remember, data is the new gold. Wanna connect to the BTC-Network? Sign up to a centralized internet provider and buy a PC or a mobile phone first! It`s so obvious and it has become so normal that we forget that the essential hardware needed to live out our naive dreams of decentralization is actually in the hands of highly centralized and elitist companies and individuals like Apple, Microsoft, AT&T, etc. And guess what, they are all connected to banks and the monetary system! So, when we support them by buying their products to build the infrastructure upon which we run our network of decentralized illusions we are actually paying those very institutions, which some people here want to overthrow. It`s absolutely crazy if you think about it.
Some examples. Exaggerated I know, but there`s some truth in it: „Oh yeah, let me buy the newest phone from a centralized company that collects all my data to look at my decentralized currency on a centralized app that collects my data too.“ „Oh boy, let me buy this mining rig from a centralized company with federally issued money and let me plug into the centralized electricity supply that makes me completely dependent on state controlled infrastructure in order to make a decentralized transaction on my centralized exchange that is funded by investments of banking institutions getting boners from all the countless transaction fees that arise from me trading myself into a wreck of despair.“
You cannot help but laugh at our own naivity sometimes, can you? I`m guilty of these examples myself so please don`t think that I`m picking on you. After all, I started to think more deeply about the entire topic of BTC because I screwed up myself.
So, we`ve been allowed to play with cryptocurrencies so far, but do you really think the Dollar-based empire would let such a disruptive technology evolve if it didn`t benefit the current power structures in the end?
  1. This point is actually huge. It`s about Investment power. Remember, the bitcoin network still relies on hardware components in order to run at all. These components are expensive and require a lot of maintenance. Now, who has got the most investment power and money supply to buy, run and maintain these components? The normie next door ranting on his iPhone about how he will free himself from centralized powers because it`s trendy atm? No. The tech-savy nerd trying to mine dogecoin for lulz? No. It`s the already wealthy, it`s the guys who already have the liquidity to scoop up the rising technologies of the future. After all, this is the game they`ve been playing for a long time and which has made them wealthy and powerful in the first place! And guess what they are in for? Compassion and decentralization of power? You`d be naive to think so for even the ordinary crypto-enthusiast aims to ruthlessly accumulate as much BTC in their OWN account as possible and compared to these guys we absolutely suck at it.
  2. In terms of developing cryptographic web-based applications and secure data transmissions who do you think is most involved in such research and development? Freedom loving, open-source saints with hearts of pure gold and benevolence? Sure there are many of them and I`m truly grateful for their effort. But you`d be foolish to think that they have been spear-heading this development. It`s the military industrial complex as it has always been because they have the incentive, the resources, the infrastructure, the competition from rivaling nations, the recruitement processes and the best brains on the planet to work on these things. Also, any new patent that is submitted is being vetted by national security agencies and if it poses a threat to the nation and its socio-economic processes, its publication will be withheld until the necessary countermeasures have been taken. There has been a fungus researcher (Paul Stamets) who has developed a process to extract something of interest out of portobello mushrooms whose patent application has been removed because it posed a threat to national security (there is a Joe rogan podcast where he explained it all)! If intelligence agencies are able to detect the threat a fungus can pose how the hell could you possibly believe that a technology able to disrupt the global monopoly of the dollar goes undetected?! Especially considering that the intelligence agencies have had an eye on the dark web from the beginning. If they wanted to stop BTC`s rise they would have had the time to do so. The fact that they didn`t and the fact that the U.S. seems to want to introduce BTC and cryptographic payments to the masses makes me think really hard about the disruptive potential that we tell ourselves BTC has.
Knowing about the way power structures work and knowing about the far reach of intelligence services and global elites I must conclude that this entire crypto hype is actually allowed to happen, maybe has even been fabricated intentionally and thus decentralization is actually a catch-phrase for more centralization and an extension of power for the elites. Satoshi Nakamoto is a ghost because he does not exist and has been fabricated for the sake of this anonymous introduction of a new financial system.
It`s really startling to realize this. It seems as if we are being deliberately mesmerized once again with the seeming promise of personal freedom and decentralization only to buy into and strengthen the elitist power structures that underlie this technology. One must understand that access to infrastructure, technological innovation and also the personal empowerment of the masses is a two-edged sword. Because everything that we use to improve our lives with, every new technology, every resource and behaviour is being weighed against the impact such implementation would impose onto the distribution of power in the global economy, banking institutions and multinational corporations. For example: Sure, there may already be a patent for a working long-distance hydrogen motor and a concept to produce it cost-effectively. It would seemingly improve many environmental problems and slow the greenhouse effect. But you know what? If it were to be introduced at once the Petrol industry, the petrol based automotive industry and all its connected industries and networks of power would suffer a blow that is detrimental to global economics. We all want a clean atmosphere. But guess what? Innovation MUST ALWAYS be supportive of current economic processes and global powers for if they get disrupted the very system that upholds the lives of the ordinary citizen would get disrupted too. The fact that Bitcoin is allowed to continue its rise shows me that it is actually supportive of current political and institutional powers and not as liberating as many people hope it is.
So, what does this mean? It`s very simple. There is no such thing as innovation or disruption from the bottom up at this point. (Except maybe large-scale strikes and coordinated revolution) You see, global power and global economy are not separated entities. They are one and the same and in the hands of a few compared to entire human population. Thus technological advance and empowerment of the masses is not a process that is guided by ethics and benevolence but a process that is judged by whether or not it helps to maintain or improve the current power structures and economic processes that human civilization depends upon.
Certainly, BTC and pseudo-decentralized networks can be an incredibly valuable tool to advance certain interests, improve many processes and to expand certain structures of influence for both elite institutions and ordinary citizens as well. It will not go away. BTC will grow and be used the masses. But remember, always remember: That, which the masses love is the best tool to control the masses as well. For they do not know that the thing they love does not belong to them completely because it is always linked to some fundamental infrastructure or resource that is controlled by others. And yet, being able to use or pay for a technology that you do not own entirely is better than not being able to use it all, isn`t it?
So, what does this all mean to us crypto-enthusiasts? We must come to accept that compromises must be made. We cannot have it all. There is some amount of external, centralized control that we must become comfortable to accept. Already, the power structures that we aimed to disrupt have taken over the BTC universe. Who owns most BTC? Jup, a tiny amount of lucky fews who have had the investment potential to buy up all the nice BTC´s in the first place. Who owns the largest mining facilities and who owns the physical carrier network of cables, satellites, processors and electricity? Guess what, it`s not you, not me, nor Mr. Nakamoto. It`s the global corporations as always. Who owns and controls global data transmission infrastructure upon which blockchain protocols and the entire internet are running? Jup, not me, not you, but the same powers that we aim to disrupt. Who is most advanced in cryptographic technologies and secure data transmissions and who would be able to come up with and introduce concepts of cryptocurrencies without being shut down by the masters of the dollar? Jup, the military industrial complex in conjunction with the intelligence agencies vetting and regulating pending patents and their application. The clues just add up my fellow introverts. I cannot hide from them anymore and wanted to hear your opinion on it. But after all these disruptive ideas I wanted to end on a positive note.
You see, we cannot change the fact that human civilization is a construct that demands compromise in order to function at all. We are all different in terms of our level of knowledge, personal development and ideology. I cannot have it all, nor do you. But if we make some compromises we can live together peacefully and progress to a level that benefits all of us. In terms of disruptive technologies and the advancement of human civilization we must accept that you cannot introduce something to society for which we are not ready. And in our current state of development this means that technological advancement must not disrupt global power hierarchies and socio-economic process too heavily for this is the system upon which we build our lives and upon which our wellbeing depends. And it is indeed a fragile one. Yes, I hate the excesses of corruption and manipulation that occurs in the financial sector same as you do. But I know that I cannot tear it down at once for it would harm many processes that offer me and my family much opportunity, comfort and wellbeing in the long run. Sure, our systems are flawed and even sick in some cases. Sure, people are afraid to loose power and are afraid what would happen when other people gain too much power. Thus the keeping of power over others by our leaders and elites is fundamentally an effect caused by us humans being afraid of each other. To truly advance in a liberated and unhindered pace we must first overcome the fear of each other. Because in that fear lies all our trouble. We fear to not have enough resources, we fear to loose influence and power, we fear to loose our culture through the growth of another, we fear to loose our wealth through inflation and all the while we forget that we could actually be kind to each other and cooperate in spite of it all. We fear too much and sometimes we do so for good reason. As long as this does not change and as long as we do not grow up as one human family there will always be the desire to rule, to control and to deceive those who we fear. In that regard we can actually be thankful for having all the nice technology that we have atm. We can also be thankful to be able (or to be allowed or even lured into) to use cryptocurrencies. The fact that this empowerment through technology comes with a certain degree of control and centralization may actually be a good thing. It reflects our current state of development as the human beings that we are. Always striving to advance forward, but fearful of what we or others may find. Thus we tread cautiously, making sure that we control each step that we take for we may not know where our steps lead us next. Keeping some control and power to ourselves is the trait of a fearful mind wanting to move forward towards freedom. It`s a sane reaction. In that we are all the same. Bitcoin maximalists as well as bankers. Compromise. It`s the magic word and it`s what is necessary if two fearful minds want to advance together in peace.
I want to end here now and I want to thank you for your attention. I am thrilled about all the developments that are going to take place in 2019. I wish the cryptosphere nothing but the best and hope that you all may get rich both physically (or digitally rather) as well as emotionally.
submitted by marci_on_the_web to Bitcoin [link] [comments]

World History Timeline of Events Leading up to Bitcoin - In the Making

A (live/editable) timeline of historical events directly or indirectly related to the creation of Bitcoin and Cryptocurrencies
*still workin' on this so check back later and more will be added, if you have any suggested dates/events feel free to lemme know...
This timeline includes dates pertaining to:
Ancient Bartering – first recorded in Egypt (resources, services...) – doesn’t scale
Tally sticks were used, making notches in bones or wood, as a form of money of account
9000-6000 BC Livestock considered the first form of currency
c3200 BC Clay tablets used in Uruk (Iraq) for accounting (believed to be the earliest form of writing)
3000 BC Grain is used as a currency, measured out in Shekels
3000 BC Banking developed in Mesopotamia
3000 BC? Punches used to stamp symbols on coins were a precursor to the printing press and modern coins
? BC Since ancient Persia and all the way up until the invention and expansion of the telegraph Homing Pigeons were used to carry messages
2000 BC Merchants in Assyria, India and Sumeria lent grain to farmers and traders as a precursor to banks
1700 BC In Babylon at the time of Hammurabi, in the 18th century BC, there are records of loans made by the priests of the temple.
1200 BC Shell money first used in China
1000-600 BC Crude metal coins first appear in China
640 BC Precious metal coins – Gold & Silver first used in ancient Lydia and coastal Greek cities featuring face to face heads of a bull and a lion – first official minted currency made from electrum, a mixture of gold and silver
600-500 BC Atbash Cipher
A substitution Cipher used by ancient Hebrew scholars mapping the alphabet in reverse, for example, in English an A would be a Z, B a Y etc.
400 BC Skytale used by Sparta
474 BC Hundreds of gold coins from this era were discovered in Rome in 2018
350 BC Greek hydraulic semaphore system, an optical communication system developed by Aeneas Tacticus.
c200 BC Polybius Square
??? Wealthy stored coins in temples, where priests also lent them out
??? Rome was the first to create banking institutions apart from temples
118 BC First banknote in the form of 1 foot sq pieces of white deerskin
100-1 AD Caesar Cipher
193 Aureus, a gold coin of ancient Rome, minted by Septimius Severus
324 Solidus, pure gold coin, minted under Constantine’s rule, lasted until the late 8th century
600s Paper currency first developed in Tang Dynasty China during the 7th century, although true paper money did not appear until the 11th century, during the Song Dynasty, 960–1279
c757–796 Silver pennies based on the Roman denarius became the staple coin of Mercia in Great Britain around the time of King Offa
806 First paper banknotes used in China but isn’t widely accepted in China until 960
1024 The first series of standard government notes were issued in 1024 with denominations like 1 guàn (貫, or 700 wén), 1 mín (緡, or 1000 wén), up to 10 guàn. In 1039 only banknotes of 5 guàn and 10 guàn were issued, and in 1068 a denomination of 1 guàn was introduced which became forty percent of all circulating Jiaozi banknotes.
1040 The first movable type printer was invented in China and made of porcelain
? Some of the earliest forms of long distance communication were drums used by Native Africans and smoke signals used by Native Americans and Chinese
1088 Movable type in Song Dynasty China
1120 By the 1120s the central government officially stepped in and produced their own state-issued paper money (using woodblock printing)
1150 The Knights Templar issued bank notes to pilgrims. Pilgrims deposited their valuables with a local Templar preceptory before embarking, received a document indicating the value of their deposit, then used that document upon arrival in the Holy Land to retrieve their funds in an amount of treasure of equal value.
1200s-1300s During the 13th century bankers from north Italy, collectively known as Lombards, gradually replace the Jews in their traditional role as money-lenders to the rich and powerful. – Florence, Venice and Genoa - The Bardi and Peruzzi Families dominated banking in 14th century Florence, establishing branches in many other parts of Europe
1200 By the time Marco Polo visited China they’d move from coins to paper money, who introduced the concept to Europe. An inscription warned, "All counterfeiters will be decapitated." Before the use of paper, the Chinese used coins that were circular, with a rectangular hole in the middle. Several coins could be strung together on a rope. Merchants in China, if they became rich enough, found that their strings of coins were too heavy to carry around easily. To solve this problem, coins were often left with a trustworthy person, and the merchant was given a slip of paper recording how much money they had with that person. Marco Polo's account of paper money during the Yuan Dynasty is the subject of a chapter of his book, The Travels of Marco Polo, titled "How the Great Kaan Causeth the Bark of Trees, Made Into Something Like Paper, to Pass for Money All Over his Country."
1252 Florin minted in Florence, becomes the hard currency of its day helping Florence thrive economically
1340 Double-entry bookkeeping - The clerk keeping the accounts for the Genoese firm of Massari painstakingly fills in the ledger for the year 1340.
1397 Medici Bank established
1450 Johannes Gutenberg builds the printing press – printed words no longer just for the rich
1455 Paper money disappears from China
1466 Polyalphabetic Cipher
1466 Rotating cipher disks – Vatican – greatest crypto invention in 1000 yrs – the first system to challenge frequency analysis
1466 First known mechanical cipher machine
1472 The oldest bank still in existence founded, Banca Monte dei Paschi di Siena, headquartered in Siena, Italy
1494 Double-entry bookkeeping system codified by Luca Pacioli
1535 Wampum, a form of currency used by Native Americans, a string of beads made from clamshells, is first document.
1553 Vigenere Cipher
1557 Phillip II of Spain managed to burden his kingdom with so much debt (as the result of several pointless wars) that he caused the world's first national bankruptcy — as well as the world's second, third and fourth, in rapid succession.
1577 Newspaper in Korea
1586 The Babington Plot
1590 Cabinet Noir was established in France. Its mission was to open, read and reseal letters, and great expertise was developed in the restoration of broken seals. In the knowledge that mail was being opened, correspondents began to develop systems to encrypt and decrypt their letters. The breaking of these codes gave birth to modern systematic scientific code breaking.
1600s Promissory banknotes began in London
1600s By the early 17th century banking begins also to exist in its modern sense - as a commercial service for customers rather than kings. – Late 17th century we see cheques slowly gains acceptance
The total of the money left on deposit by a bank's customers is a large sum, only a fraction of which is usually required for withdrawals. A proportion of the rest can be lent out at interest, bringing profit to the bank. When the customers later come to realize this hidden value of their unused funds, the bank's profit becomes the difference between the rates of interest paid to depositors and demanded from debtors.
The transformation from moneylenders into private banks is a gradual one during the 17th and 18th centuries. In England it is achieved by various families of goldsmiths who early in the period accept money on deposit purely for safe-keeping. Then they begin to lend some of it out. Finally, by the 18th century, they make banking their business in place of their original craft as goldsmiths.
1605 Newspaper in Straussburg
c1627 Great Cipher
1637 Wampum is declared as legal tender in the U.S. (where we got the slang word “clams” for money)
1656 Johan Palmstruch establishes the Stockholm Banco
1661 Paper Currency reappears in Europe, soon became common - The goldsmith-bankers of London began to give out the receipts as payable to the bearer of the document rather than the original depositor
1661 Palmstruch issues credit notes which can be exchanged, on presentation to his bank, for a stated number of silver coins
1666 Stockholms Banco, the predecessor to the Central Bank of Sweden issues the first paper money in Europe. Soon went bankrupt for printing too much money.
1667 He issues more notes than his bank can afford to redeem with silver and winds up in disgrace, facing a death penalty (commuted to imprisonment) for fraud.
1668 Bank of Sweden – today the 2nd oldest surviving bank
1694 First Central Bank established in the UK was the first bank to initiate the permanent issue of banknotes
Served as model for most modern central banks.
The modern banknote rests on the assumption that money is determined by a social and legal consensus. A gold coin's value is simply a reflection of the supply and demand mechanism of a society exchanging goods in a free market, as opposed to stemming from any intrinsic property of the metal. By the late 17th century, this new conceptual outlook helped to stimulate the issue of banknotes.
1700s Throughout the commercially energetic 18th century there are frequent further experiments with bank notes - deriving from a recognized need to expand the currency supply beyond the availability of precious metals.
1710 Physiocracy
1712 First commercial steam engine
1717 Master of the Royal Mint Sir Isaac Newton established a new mint ratio between silver and gold that had the effect of driving silver out of circulation (bimetalism) and putting Britain on a gold standard.
1735 Classical Economics – markets regulate themselves when free of intervention
1744 Mayer Amschel Rothschild, Founder of the Rothschild Banking Empire, is Born in Frankfurt, Germany
Mayer Amschel Rothschild extended his banking empire across Europe by carefully placing his five sons in key positions. They set up banks in Frankfurt, Vienna, London, Naples, and Paris. By the mid 1800’s they dominated the banking industry, lending to governments around the world and people such as the Vanderbilts, Carnegies, and Cecil Rhodes.
1745 There was a gradual move toward the issuance of fixed denomination notes in England standardized printed notes ranging from £20 to £1,000 were being printed.
1748 First recorded use of the word buck for a dollar, stemming from the Colonial period in America when buck skins were commonly traded
1757 Colonial Scrip Issued in US
1760s Mayer Amschel Rothschild establishes his banking business
1769 First steam powered car
1775-1938 US Diplomatic Codes & Ciphers by Ralph E Weber used – problems were security and distribution
1776 American Independence
1776 Adam Smith’s Invisible Hand theory helped bankers and money-lenders limit government interference in the banking sector
1781 The Bank of North America was a private bank first adopted created the US Nation's first de facto central bank. When shares in the bank were sold to the public, the Bank of North America became the country's first initial public offering. It lasted less than ten years.
1783 First steamboat
1791 Congress Creates the First US Bank – A Private Company, Partly Owned by Foreigners – to Handle the Financial Needs of the New Central Government. First Bank of the United States, a National bank, chartered for a term of twenty years, it was not renewed in 1811.
Previously, the 13 states had their own banks, currencies and financial institutions, which had an average lifespan of about 5 years.
1792 First optical telegraph invented where towers with telescopes were dispersed across France 12-25 km apart, relaying signals according to positions of arms extended from the top of the towers.
1795 Thomas Jefferson invents the Jefferson Disk Cipher or Wheel Cipher
1797 to 1821 Restriction Period by England of trading banknotes for silver during Napoleonic Wars
1797 Currency Crisis
Although the Bank was originally a private institution, by the end of the 18th century it was increasingly being regarded as a public authority with civic responsibility toward the upkeep of a healthy financial system.
1799 First paper machine
1800 Banque de France – France’s central bank opens to try to improve financing of the war
1800 Invention of the battery
1801 Rotchschild Dynasty begins in Frankfurt, Holy Roman Empire – established international banking family through his 5 sons who established themselves in London, Paris, Frankfurt, Vienna, and Naples
1804 Steam locomotive
1807 Internal combustion engine and automobile
1807 Robert Fulton expands water transportation and trade with the workable steamboat.
1809 Telegraphy
1811 First powered printing press, also first to use a cylinder
1816 The Privately Owned Second Bank of the US was Chartered – It Served as the Main Depository for Government Revenue, Making it a Highly Profitable Bank – charter not renewed in 1836
1816 The first working telegraph was built using static electricity
1816 Gold becomes the official standard of value in England
1820 Industrial Revolution
c1820 Neoclassical Economics
1821 British gov introduces the gold standard - With governments issuing the bank notes, the inherent danger is no longer bankruptcy but inflation.
1822 Charles Babbage, considered the "father of the computer", begins building the first programmable mechanical computer.
1832 Andrew Jackson Campaigns Against the 2nd Bank of the US and Vetoes Bank Charter Renewal
Andrew Jackson was skeptical of the central banking system and believed it gave too few men too much power and caused inflation. He was also a proponent of gold and silver and an outspoken opponent of the 2nd National Bank. The Charter expired in 1836.
1833 President Jackson Issues Executive Order to Stop Depositing Government Funds Into Bank of US
By September 1833, government funds were being deposited into state chartered banks.
1833-1837 Manufactured “boom” created by central bankers – money supply Increases 84%, Spurred by the 2nd Bank of the US
The total money supply rose from $150 million to $267 million
1835 Jackson Escapes Assassination. Assassin misfired twice.
1837-1862 The “Free Banking Era” there was no formal central bank in the US, and banks issued their own notes again
1838 First Telegram sent using Morse Code across 3 km, in 1844 he sent a message across 71 km from Washington DC to Baltimore.
1843 Ada Lovelace published the first algorithm for computing
1844 Modern central bank of England established - meaning only the central bank of England could issue banknotes – prior to that commercial banks could issue their own and were the primary form of currency throughout England
the Bank of England was restricted to issue new banknotes only if they were 100% backed by gold or up to £14 million in government debt.
1848 Communist Manifesto
1850 The first undersea telegraphic communications cable connected France in England after latex produced from the sap of the Palaquium gutta tree in 1845 was proposed as insulation for the underwater cables.
1852 Many countries in Europe build telegram networks, however post remained the primary means of communication to distant countries.
1855 In England fully printed notes that did not require the name of the payee and the cashier's signature first appeared
1855 The printing telegraph made it possible for a machine with 26 alphabetic keys to print the messages automatically and was soon adopted worldwide.
1856 Belgian engineer Charles Bourseul proposed telephony
1856 The Atlantic Telegraph company was formed in London to stretch a commercial telegraph cable across the Atlantic Ocean, completed in 1866.
1860 The Pony Express was founded, able to deliver mail of wealthy individuals or government officials from coast to coast in 10 days.
1861 The East coast was connected to the West when Western Union completed the transcontinental telegraph line, putting an end to unprofitable The Pony Express.
1862-1863 First US banknotes - Lincoln Over Rules Debt-Based Money and Issues Greenbacks to Fund Civil War
Bankers would only lend the government money under certain conditions and at high interest rates, so Lincoln issued his own currency – “greenbacks” – through the US Treasury, and made them legal tender. His soldiers went on to win the war, followed by great economic expansion.
1863 to 1932 “National Banking Era” Commercial banks in the United States had legally issued banknotes before there was a national currency; however, these became subject to government authorization from 1863 to 1932
1864 Friedrich Wilhelm Raiffeisen founded the first rural credit union in Heddesdorf (now part of Neuwied) in Germany. By the time of Raiffeisen's death in 1888, credit unions had spread to Italy, France, the Netherlands, England, Austria, and other nations
1870 Long-distance telegraph lines connected Britain and India.
c1871 Marginalism - The doctrines of marginalism and the Marginal Revolution are often interpreted as a response to the rise of the worker's movement, Marxian economics and the earlier (Ricardian) socialist theories of the exploitation of labour.
1871 Carl Menger’s Principles of Economics – Austrian School
1872 Marx’s Das Capital
1872 Australia becomes the first nation to be connected to the rest of the world via submarine telegraph cables.
1876 Alexander Graham Bell patented the telephone, first called the electric speech machine – revolutionized communication
1877 Thomas Edison – Phonograph
1878 Western Union, the leading telegraph provider of the U.S., begins to lose out to the telephone technology of the National Bell Telephone Company.
1881 President James Garfield, Staunch Proponent of “Honest Money” Backed by Gold and Silver, was Assassinated
Garfield opposed fiat currency (money that was not backed by any physical object). He had the second shortest Presidency in history.
1882 First description of the one-time pad
1886 First gas powered car
1888 Ballpoint pen
1892 Cinematograph
1895 System of wireless communication using radio waves
1896 First successful intercontinental telegram
1898 Polyethylene
1899 Nickel-cadmium battery
1907 Banking Panic of 1907
The New York Stock Exchange dropped dramatically as everyone tried to get their money out of the banks at the same time across the nation. This banking panic spurred debate for banking reform. JP Morgan and others gathered to create an image of concern and stability in the face of the panic, which eventually led to the formation of the Federal Reserve. The founders of the Federal Reserve pretended like the bankers were opposed to the idea of its formation in order to mislead the public into believing that the Federal Reserve would help to regulate bankers when in fact it really gave even more power to private bankers, but in a less transparent way.
1908 St Mary’s Bank – first credit union in US
1908 JP Morgan Associate and Rockefeller Relative Nelson Aldrich Heads New National Monetary Commission
Senate Republican leader, Nelson Aldrich, heads the new National Monetary Commission that was created to study the cause of the banking panic. Aldrich had close ties with J.P. Morgan and his daughter married John D. Rockefeller.
1910 Bankers Meet Secretly on Jekyll Island to Draft Federal Reserve Banking Legislation
Over the course of a week, some of the nation’s most powerful bankers met secretly off the coast of Georgia, drafting a proposal for a private Central Banking system.
1913 Federal Reserve Act Passed
Two days before Christmas, while many members of Congress were away on vacation, the Federal Reserve Act was passed, creating the Central banking system we have today, originally with gold backed Federal Reserve Notes. It was based on the Aldrich plan drafted on Jekyll Island and gave private bankers supreme authority over the economy. They are now able to create money out of nothing (and loan it out at interest), make decisions without government approval, and control the amount of money in circulation.
1913 Income tax established -16th Amendment Ratified
Taxes ensured that citizens would cover the payment of debt due to the Central Bank, the Federal Reserve, which was also created in 1913.The 16th Amendment stated: “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”
1914 November, Federal Reserve Banks Open
JP Morgan and Co. Profits from Financing both sides of War and Purchasing Weapons
J.P. Morgan and Co. made a deal with the Bank of England to give them a monopoly on underwriting war bonds for the UK and France. They also invested in the suppliers of war equipment to Britain and France.
1914 WWI
1917 Teletype cipher
1917 The one-time pad
1917 Zimmerman Telegram intercepted and decoded by Room 40, the cryptanalysis department of the British Military during WWI.
1918 GB returns to gold standard post-war but it didn’t work out
1919 First rotor machine, an electro-mechanical stream ciphering and decrypting machine.
1919 Founding of The Cipher Bureau, Poland’s intelligence and cryptography agency.
1919-1929 The Black Chamber, a forerunner of the NSA, was the first U.S. cryptanalytic organization. Worked with the telegraph company Western Union to illegally acquire foreign communications of foreign embassies and representatives. It was shut down in 1929 as funding was removed after it was deemed unethical to intercept private domestic radio signals.
1920s Department stores, hotel chains and service staions begin offering customers charge cards
1921-1929 The “Roaring 20’s” – The Federal Reserve Floods the Economy with Cash and Credit
From 1921 to 1929 the Federal Reserve increased the money supply by $28 billion, almost a 62% increase over an eight-year period.[3] This artificially created another “boom”.
1927 Quartz clock
1928 First experimental Television broadcast in the US.
1929 Federal Reserve Contracts the Money Supply
In 1929, the Federal Reserve began to pull money out of circulation as loans were paid back. They created a “bust” which was inevitable after issuing so much credit in the years before. The Federal Reserve’s actions triggered the banking crisis, which led to the Great Depression.
1929 October 24, “Black Thursday”, Stock Market Crash
The most devastating stock market crash in history. Billions of dollars in value were consolidated into the private banker’s hands at the expense of everyone else.
1930s The Great Depression marked the end of the gold standard
1931 German Enigma machines attained and reconstructed.
1932 Turbo jet engine patented
1933 SEC founded - passed the Glass–Steagall Act, which separated investment banking and commercial banking. This was to avoid more risky investment banking activities from ever again causing commercial bank failures.
1933 FM Radio
1933 Germany begins Telex, a network of teleprinters sending and receiving text based messages. Post WWII Telex networks began to spread around the world.
1936 Austrian engineer Paul Eisler invented Printed circuit board
1936 Beginning of the Keynesian Revolution
1937 Typex, British encryption machines which were upgraded versions of Enigma machines.
1906 Teletypewriters
1927 Founding of highly secret and unofficial Signal Intelligence Service, SIS, the U.S. Army’s codebreaking division.
1937 Made illegal for Americans to own gold
1938 Z1 built by Konrad Zuse is the first freely programmable computer in the world.
1939 WWII – decline of the gold standard which greatly restricted policy making
1939-45 Codetalkers - The Navajo code is the only spoken military code never to have been deciphered - "Were it not for the Navajos, the Marines would never have taken Iwo Jima."—Howard Connor
1940 Modems
1942 Deciphering Japanese coded messages leads to a turning point victory for the U.S. in WWII.
1943 At Bletchley Park, Alan Turing and team build a specialized cipher-breaking machine called Heath Robinson.
1943 Colossus computer built in London to crack the German Lorenz cipher.
1944 Bretton Woods – convenient after the US had most of the gold
1945 Manhattan Project – Atom Bomb
1945 Transatlantic telephone cable
1945 Claude E. Shannon published "A mathematical theory of cryptography", commonly accepted as the starting point for development of modern cryptography.
C1946 Crypto Wars begin and last to this day
1946 Charg-it card created by John C Biggins
1948 Atomic clock
1948 Claude Shannon writes a paper that establishes the mathematical basis of information theory
1949 Info theorist Claude Shannon asks “What does an ideal cipher look like?” – one time pad – what if the keys are not truly random
1950 First credit card released by the Diners Club, able to be used in 20 restaurants in NYC
1951 NSA, National Security Agency founded and creates the KL-7, an off-line rotor encryption machine
1952 First thermonuclear weapon
1953 First videotape recorder
1953 Term “Hash” first used meaning to “chop” or “make a mess” out of something
1954 Atomic Energy Act (no mention of crypto)
1957 The NSA begins producing ROMOLUS encryption machines, soon to be used by NATO
1957 First PC – IBM
1957 First Satellite – Sputnik 1
1958 Western Union begins building a nationwide Telex network in the U.S.
1960s Machine readable codes were added to the bottom of cheques in MICR format, which speeded up the clearing and sorting process
1960s Financial organizations were beginning to require strong commercial encryption on the rapidly growing field of wired money transfer.
1961 Electronic clock
1963 June 4, Kennedy Issued an Executive Order (11110) that Authorized the US Treasury to Issue Silver Certificates, Threatening the Federal Reserve’s Monopoly on Money
This government issued currency would bypass the governments need to borrow from bankers at interest.
1963 Electronic calculator
1963 Nov. 22, Kennedy Assassinated
1963 Johnson Reverses Kennedy’s Banking Rule and Restores Power to the Federal Reserve
1964 8-Track
1964 LAN, Local Area Networks adapters
1965 Moore’s Law by CEO of Intel Gordon Moore observes that the number of components per integrated circuit doubles every year, and projected this rate of growth would continue for at least another decade. In 1975 he revised it to every two years.
1967 First ATM installed at Barclay’s Bank in London
1968 Cassette Player introduced
1969 First connections of ARPANET, predecessor of the internet, are made. started – SF, SB, UCLA, Utah (now Darpa) – made to stay ahead of the Soviets – there were other networks being built around the world but it was very hard to connect them – CERN in Europe
1970s Stagflation – unemployment + inflation, which Keynesian theory could not explain
1970s Business/commercial applications for Crypto emerge – prior to this time it was militarily used – ATMs 1st got people thinking about commercial applications of cryptography – data being sent over telephone lines
1970s The public developments of the 1970s broke the near monopoly on high quality cryptography held by government organizations.
Use of checks increased in 70s – bringing about ACH
One way functions...
A few companies began selling access to private networks – but weren’t allowed to connect to the internet – business and universities using Arpanet had no commercial traffic – internet was used for research, not for commerce or advertising
1970 Railroads threatened by the growing popularity of air travel. Penn Central Railroad declares bankruptcy resulting in a $3.2 billion bailout
1970 Conjugate coding used in an attempt to design “money physically impossible to counterfeit”
1971 The US officially removes the gold standard
1971 Email invented
1971 Email
1971 First microcomputer on a chip
1971 Lockheed Bailout - $1.4 billion – Lockheed was a major government defense contractor
1972 First programmable word processor
1972 First video game console
1973 SWIFT established
1973 Ethernet invented, standardized in ‘83
1973 Mobile phone
1973 First commercial GUI – Xerox Alto
1973 First touchscreen
1973 Emails made up more than ¾ of ARPANET’s packets – people had to keep a map of the network by their desk – so DNS was created
1974 A protocol for packet network intercommunication – TCP/IP – Cerf and Kahn
1974 Franklin National Bank Bailout - $1.5 billion (valued at that time) - At the time, it was the largest bank failure in US history
1975 New York City Bailout - $9.4 billion – NYC was overextended
1975 W DES - meant that commercial uses of high quality encryption would become common, and serious problems of export control began to arise.
1975 DES, Data Encryption Standard developed at IBM, seeking to develop secure electronic communications for banks and large financial organizations. DES was the first publicly accessible cipher to be 'blessed' by a national agency such as the NSA. Its release stimulated an explosion of public and academic interest in cryptography.
1975 Digital camera
1975 Altair 8800 sparks the microprocessor revolution
1976 Bretton Woods ratified (lasted 30 years) – by 80’s all nations were using floating currencies
1976 New Directions in Cryptography published by Diffie & Hellman – this terrified Fort Meade – previously this technique was classified, now it’s public
1976 Apple I Computer – Steve Wozniak
1976 Asymmetric key cryptosystem published by Whitfield Diffie and Martin Hellman.
1976 Hellman and Diffie publish New Directions in Cryptography, introducing a radically new method of distributing cryptographic keys, contributing much to solving key distribution one of the fundamental problems of cryptography. It brought about the almost immediate public development of asymmetric key algorithms. - where people can have 2 sets of keys, public and private
1977 Diffie & Hellman receive letter from NSA employee JA Meyer that they’re violating Federal Laws comparable to arms export – this raises the question, “Can the gov prevent academics from publishing on crypto?
1977 DES considered insecure
1977 First handheld electronic game
1977 RSA public key encryption invented
1978 McEliece Cryptosystem invented, first asymmetric encryption algorithm to use randomization in the encryption process
1980s Large data centers began being built to store files and give users a better faster experience – companies rented space from them - Data centers would not only store data but scour it to show people what they might want to see and in some cases, sell data
1980s Reaganomics and Thatcherism
1980 A decade of intense bank failures begins; the FDIC reports that 1,600 were either closed or received financial assistance from 1980 to 1994
1980 Chrysler Bailout – lost over $1 billion due to major hubris on the part of its executives - $1.5 billion one of the largest payouts ever made to a single corporation.
1980 Protocols for public key cryptosystems – Ralph Merkle
1980 Flash memory invented – public in ‘84
1981 “Untraceable Electronic Mail, Return Addresses and Digital Pseudonumns” – Chaum
1981 EFTPOS, Electronic funds transfer at point of sale is created
1981 IBM Personal Computer
1982 “The Ethics of Liberty” Murray Rothbard
1982 Commodore 64
1982 CD
1983 Satellite TV
1983 First built in hard drive
1983 C++
1983 Stereolithography
1983 Blind signatures for untraceable payments
Mid 1980s Use of ATMs becomes more widespread
1984 Continental Illinois National Bank and Trust bailed out due to overly aggressive lending styles and - the bank’s downfall could be directly traced to risk taking and a lack of due diligence on the part of bank officers - $9.5 billion in 2008 money
1984 Macintosh Computer - the first mass-market personal computer that featured a graphical user interface, built-in screen and mouse
1984 CD Rom
1985 Zero-Knowledge Proofs first proposed
1985 300,000 simultaneous telephone conversations over single optical fiber
1985 Elliptic Curve Cryptography
1987 ARPANET had connected over 20k guarded computers by this time
1988 First private networks email servers connected to NSFNET
1988 The Crypto Anarchists Manifesto – Timothy C May
1988 ISDN, Integrated Services Digital Network
1989 Savings & Loan Bailout - After the widespread failure of savings and loan institutions, President George H. W. Bush signed and Congress enacted the Financial Institutions Reform Recovery and Enforcement Act - This was a taxpayer bailout of about $200 billion
1989 First commercial emails sent
1989 Digicash - Chaum
1989 Tim Berners-Lee and Robert Cailliau built the prototype system which became the World Wide Web, WWW
1989 First ISPs – companies with no network of their own which connected people to a local network and to the internet - To connect to a network your computer placed a phone call through a modem which translated analog signals to digital signals – dial-up was used to connect computers as phone lines already had an extensive network across the U.S. – but phone lines weren’t designed for high pitched sounds that could change fast to transmit large amounts of data
1990s Cryptowars really heat up...
1990s Some countries started to change their laws to allow "truncation"
1990s Encryption export controls became a matter of public concern with the introduction of the personal computer. Phil Zimmermann's PGP cryptosystem and its distribution on the Internet in 1991 was the first major 'individual level' challenge to controls on export of cryptography. The growth of electronic commerce in the 1990s created additional pressure for reduced restrictions.[3] Shortly afterward, Netscape's SSL technology was widely adopted as a method for protecting credit card transactions using public key cryptography.
1990 NSFNET replaced Arpanet as backbone of the internet with more than 500k users
Early 90s Dial up provided through AOL and Compuserve
People were leery to use credit cards on the internet
1991 How to time-stamp a digital doc - Stornetta
1991 Phil Zimmermann releases the public key encryption program Pretty Good Privacy (PGP) along with its source code, which quickly appears on the Internet. He distributed a freeware version of PGP when he felt threatened by legislation then under consideration by the US Government that would require backdoors to be included in all cryptographic products developed within the US. Expanded the market to include anyone wanting to use cryptography on a personal computer (before only military, governments, large corporations)
1991 WWW (Tim Berners Lee) – made public in ‘93 – flatten the “tree” structure of the internet using hypertext – reason for HTTP//:WWW – LATER HTTPS for more security
1992 Erwise – first Internet Browser w a graphical Interface
1992 Congress passed a law allowing for commercial traffic on NSFNET
1992 Cpherpunks, Eric Hughes, Tim C May and John Gilmore – online privacy and safety from gov – cypherpunks write code so it can be spread and not shut down (in my earlier chapter)
1993 Mosaic – popularized surfing the web ‘til Netscape Navigator in ’94 – whose code was later used in Firefox
1993 A Cypherpunks Manifesto – Eric Hughes
1994 World’s first online cyberbank, First Virtual, opened for business
1994 Bluetooth
1994 First DVD player
1994 Stanford Federal Credit Union becomes the first financial institution to offer online internet banking services to all of its members in October 1994
1994 Internet only used by a few
1994 Cybercash
1994 Secure Sockets Layer (SSL) encryption protocol released by Netscape. Making financial transactions possible.
1994 One of the first online purchases was made, a Pizza Hut pepperoni pizza with mushrooms and extra cheese
1994 Cyphernomicon published – social implication where gov can’t do anything about it
1994-1999 Social Networking – GeoCities (combining creators and users) – had 19M users by ’99 – 3rd most popular after AOL and Yahoo – GeoCities purchased by Yahoo for $3.6B but took a hit after dotcom bubble popped and never recovered – GC shut down in ‘99
1995-2000 Dotcom bubble – Google, Amazon, Facebook: get over 600M visitors/year
1995 DVD
1995 MP3 term coined for MP3 files, the earlier development of which stretches back into the ‘70s, where MP files themselves where developed throughout the ‘90s
1995 NSFNET shut down and handed everything over to the ISPs
1995 NSA publishes the SHA1 hash algorithm as part of its Digital Signature Standard.
1996, 2000 President Bill Clinton signing the Executive order 13026 transferring the commercial encryption from the Munition List to the Commerce Control List. This order permitted the United States Department of Commerce to implement rules that greatly simplified the export of proprietary and open source software containing cryptography, which they did in 2000 - The successful cracking of DES likely helped gather both political and technical support for more advanced encryption in the hands of ordinary citizens - NSA considers AES strong enough to protect information classified at the Top Secret level
1996 e-gold
1997 WAP, Wireless Access Point
1997 NSA researchers published how to mint e cash
1997 Adam Back – HashCash – used PoW – coins could only be used once
1997 Nick Szabo – smart contracts “Formalizing and Securing Relationships on Public Networks”
1998 OSS, Open-source software Initiative Founded
1998 Wei Dai – B-money – decentralized database to record txs
1998 Bitgold
1998 First backdoor created by hackers from Cult of the Dead Cow
1998 Musk and Thiel founded PayPal
1998 Nick Szabo says crypto can protect land titles even if thugs take it by force – said it could be done with a timestamped database
1999 Much of the Glass-Steagal Act repealed - this saw US retail banks embark on big rounds of mergers and acquisitions and also engage in investment banking activities.
1999 Milton Friedman says, “I think that the Internet is going to be one of the major forces for reducing the role of government. The one thing that's missing, but that will soon be developed, is a reliable e-cash - a method whereby on the Internet you can transfer funds from A to B without A knowing B or B knowing A.”
1999 European banks began offering mobile banking with the first smartphones
1999 The Financial Services Modernization Act Allows Banks to Grow Even Larger
Many economists and politicians have recognized that this legislation played a key part in the subprime mortgage crisis of 2007.
1999-2001 Napster, P2P file sharing – was one of the fastest growing businesses in history – bankrupt for paying musicians for copyright infringement

submitted by crypto_jedi_ninja to Bitcoin [link] [comments]

The Great BitAccess Success - How I've made $50,000 buying a BitAccess BTM

In light of the recent post re: Robocoin, I thought I'd share a positive experience with another Bitcoin ATM manufacturer.
I was the first owner of a BitAccess BTM. Late 2013 I received a call out of the blue from a gentleman letting me know that him and his team had been working for a few weeks developing a Bitcoin ATM. Knowing that I was opening Bitcoin Decentral January 1st, he asked me if I would be their first customer and help them work through the bugs with their first machine.
From concept to first deployment was no more than 2 months and I boastfully displayed the new orange machine to reddit Christmas day.
So what has been my experience? Man oh man there have been problems, but that's to be expected. At the end of the day it comes down to customer service and respect, and BitAccess succeeds in both categories. The machine has been up 99% of the time and I always know I can contact them by phone anytime of the day if issues arise.
Thanks Abdul (Haseeb), Moe, Vignish, and Ryan for choosing me as your first operator, for addressing and handling my concerns in a professional way, and for being a proper BTC company. Much respect!
(Now if I could only get the new operator dashboard you promised me weeks ago) :)
-A
submitted by adiiorio to Bitcoin [link] [comments]

Bitcoin Mining & The Beauty Of Capitalism

Authored by Valentin Schmid via The Epoch Times,
While the price of bitcoin drops, miners get more creative... and some flourish.
The bitcoin price is crashing; naysayers and doomsayers are having a field day. The demise of the dominant cryptocurrency is finally happening — or is it?
Bitcoin has been buried hundreds of times, most notably during the brutal 90 percent decline from 2013 to 2015. And yet it has always made a comeback.
Where the skeptics are correct: The second bitcoin bubble burst in December of last year and the price is down roughly 80 percent from its high of $20,000. Nobody knows whether and when it will see these lofty heights again.
As a result, millions of speculators have been burned, and big institutions haven’t showed up to bridge the gap.
This also happened on a smaller scale in 2013 after a similar 100x run-up, and it was necessary.

Time to Catch Up

What most speculators and even some serious proponents of the independent and decentralized monetary system don’t understand: Bitcoin needs these pauses to make improvements in its infrastructure.
Exchanges, which could not handle the trading volumes at the height of the frenzy and did not return customer service inquiries, can take a breather and upgrade their systems and hire capable people.
The technology itself needs to make progress and this needs time. Projects like the lightning network, a system which delivers instant bitcoin payments at very little cost and at virtually unlimited scale is now only available to expert programmers.
A higher valuation is only justified if these improvements reach the mass market.
And since we live in a world where everything financial is tightly regulated, for better or worse, this area also needs to catch up, since regulators are chronically behind the curve of technological progress.
And of course, there is bitcoin mining. The vital infrastructure behind securing the bitcoin network and processing its transactions has been concentrated in too few hands and in too few places, most notably China, which still hosts about 70 percent of the mining capacity.

The Case For Mining

Critics have always complained that bitcoin mining consumes “too much” electricity, right now about as much as the Czech Republic. In energy terms this is around 65 terawatt hours or 230,000,000 gigajoules, costing $3.3 billion dollars according to estimates by Digiconomist.
For the non-physicists among us, this is around as much as consumed by six million energy-guzzling U.S. households per year.
All those estimates are imprecise because the aggregate cannot know how much energy each of the different bitcoin miners consumes and how much that electricity costs. But they are a reasonable rough estimate.
So it’s worth exploring why mining is necessary to begin with and whether the electricity consumption is justified.
Anything and everything humans do consumes resources. The question then is always: Is it worth it? And: Who decides?
This question then leads to the next question: Is it worth having and using money? Most people would argue yes, because using money instead of barter in fact makes economic transactions faster and cheaper and thus saves resources, natural and human.

_Merchants exchange goods with the inhabitants of Tidore, Indonesia, circa 1550. Barter was supplanted by using money because it is more efficient. (Archive/Getty Images)_If we are generously inclined, we will grant bitcoin the status of a type of money or at least currency as it meets the general requirements of being recognizable, divisible, portable, durable, is accepted in exchange for other goods and services, and in this case it is even limited in supply.
So having any type of money has a price, whether it’s gold, dollar bills, or numbers on the screen of your online banking system. In the case of bitcoin, it’s the electricity and the capital for the computing equipment, as well as the human resources to run these operations.
If we think having money in general is a good idea and some people value the decentralized and independent nature of bitcoin then it would be worth paying for verifying transactions on the bitcoin network as well as keeping the network secure and sound: Up until the point where the resources consumed would outweigh the efficiency benefits. Just like most people don’t think it’s a bad idea to use credit cards and banks, which consume electricity too.
However, bitcoin is a newcomer and this is why it’s being scrutinized even more so than the old established players.

Different Money, Different Costs

How many people know how much electricity, human lives, and other resources gold mining consumes or has consumed in the course of history? What about the banking system? Branches, servers, air-conditioning, staff? What about printing dollar notes and driving them around in armored trucks?
What about the social effects of monetary mismanagement of bank and government money like inflation as well as credit deflations? Gold gets a pass here.
Most people haven’t asked that question, which is why it’s worth pointing out the only comprehensive study done on the topic in 2014. In “An Order of Magnitude” the engineer Hass McCook analyzes the different money systems and reaches mind-boggling conclusions.
The study is a bit dated and of course the aggregations are also very rough estimates, but the ball park numbers are reasonable and the methodology sound.
In fact, according to the study, bitcoin is the most economic of all the different forms of money.
Gold mining in 2014 used 475 million GJ, compared to bitcoin’s 230 million in 2018. The banking system in 2014 used 2.3 billion gigajoules.
Over 100 people per year die trying to mine gold. But mining costs more than electricity. It consumes around 300,000 liters of water per kilogram of gold mined as well as 150 kilogram (330 pounds) of cyanide and 1500 tons of waste and rubble.
The international banking system has been used in all kinds of fraudulent activity throughout history: terrorist financing, money laundering, and every other criminal activity under the sun at a cost of trillions of dollars and at an order of magnitude higher than the same transactions done with cryptocurrency and bitcoin.
And of course, while gold has a relatively stable value over time, our bank and government issued money lost about 90 percent of its purchasing power over the last century, because it can be created out of thin air. This leads to inflation and a waste of physical and human resources because it distorts the process of capital allocation.

_The dollar has lost more than 90 percent of its value since the creation of the Federal Reserve in 1913. (Source: St. Louis Fed)_This is on top of the hundreds of thousands of bank branches, millions of ATMs and employees which all consume electricity and other resources, 10 times as much electricity alone as the bitcoin network.
According to monetary philosopher Saifedean Ammous, author of “The Bitcoin Standard,” the social benefit of hard money, i.e. money that can’t be printed by government decree, cannot even be fathomed; conversely, the true costs of easy money—created by government fiat and bank credit—are difficult to calculate.
According to Ammous, bitcoin is the hardest money around, even harder than gold because its total supply is capped, whereas the gold supply keeps increasing at about 1-2 percent every year.
“Look at the era of the classical gold standard, from 1871, the end of the Franco–Prussian War, until the beginning of World War I. There’s a reason why this is known as the Golden Era, the Gilded Age, and La Belle Epoque. It was a time of unrivaled human flourishing all over the world. Economic growth was everywhere. Technology was being spread all over the world. Peace and prosperity were increasing everywhere around the world. Technological innovations were advancing.
“I think this is no coincidence. What the gold standard allowed people to do is to have a store of value that would maintain its value in the future. And that gave people a low time preference, that gave people the incentive to think of the long term, and that made people want to invest in things that would pay off over the long term … bitcoin is far closer to gold. It is a digital equivalent of gold,” he said in an interview with The Epoch Times.
Of course, contrary to the gold standard that Ammous talks about, bitcoin doesn’t have a track record of being sound money in practice. In theory it meets all the criteria, but in the real world it hasn’t been adopted widely and has been so volatile as to be unusable as a reliable store of value or as the underlying currency of a productive lending market.
The proponents argue that over time, these problems will be solved the same way gold spread itself throughout the monetary sphere replacing copper and seashells, but even Ammous concedes the process may take decades and the outcome is far from certain. Gold is the safe bet for sound money, bitcoin has potential.
There is another measure where bitcoin loses out, according to a recent study by researchers from the Oak Ridge Institute in Cincinnati, Ohio.
It is the amount of energy expended per dollar for different monetary instruments. One dollar worth of bitcoin costs 17 megajoules to mine versus five for gold and seven for platinum. But the study omits the use of cyanide, water, and other physical resources in mining physical metals.
In general, the comparisons in dollar terms go against bitcoin because it is worth relatively less, only $73 billion in total at the time of writing. An issue that could be easily fixed at a higher price, but a higher price is only justified if the infrastructure improves, adoption increases, volatility declines, and the network proves its resilience to attacks over time.
In the meantime, market participants still value the fact they can own a currency independent of the government, completely digital, easily fungible, and limited in supply, and relatively decentralized. And the market as a whole is willing to pay a premium for these factors reflected in the higher per dollar prices for mining bitcoin.

The Creativity of Bitcoin Mining

But where bitcoin mining lacks in scale, it makes up for it in creativity.
In theory—and in practice—bitcoin mining can be done anywhere where there is cheap electricity. So bitcoin mining operations can be conducted not where people are (banking) or where government is (fiat cash) or where gold is (gold mining)—it can be done everywhere where there is cheap electricity
Some miners are flocking to the heat of the Texan desert where gas is virtually available for free, thanks to another oil revolution.
Other miners go to places where there is cheap wind, water, or other renewable energy.
This is because they don’t have to build bank branches, printing presses, and government buildings, or need to put up excavators and conveyor belts to dig gold out of the ground.
All they need is internet access and a home for the computers that look like a shipping container, each one of which has around 200 specialized bitcoin mining computers in them.
“The good thing about bitcoin mining is that it doesn’t matter where on earth a transaction happens, we can verify it in our data center here. The miners are part of the decentralized philosophy of bitcoin, it’s completely independent of your location as well,” said Moritz Jäger, chief technology officer at bitcoin Mining company Northern Bitcoin AG.

Centralized Mining

But so far, this decentralization hasn’t worked out as well as it sounds in theory.
Because Chinese local governments had access to subsidized electricity, it was profitable for officials to cut deals with bitcoin mining companies and supply them with cheap electricity in exchange for jobs and cutbacks. Sometimes the prices were as low as 2 dollar cents to 4 dollar cents per kilowatt hour.
This is why the majority of bitcoin mining is still concentrated in China (around 70 percent) where it was the most profitable, but only because the Chinese central planners subsidized the price of electricity.
This set up led to the by and large unwanted result that the biggest miner of bitcoin, a company called Bitmain, is also the biggest manufacturer of specialized computing equipment for bitcoin mining. The company reported revenues of $2.8 billion for the first half of 2018.

Tourists walk on the dunes near a power plant in Xiangshawan Desert in Ordos of Inner Mongolia, in this file photo. bitcoin miners have enjoyed favorable electricity rates in places like Ordos for a long time. (Feng Li/Getty Images)Centralized mining is a problem because whenever there is one player or a conglomerate of players who control more than 50 percent of the network computing power, they could theoretically crash the network by spending the same bitcoin twice, the so called “double spending problem.“
They don’t have an incentive to do so because it would probably ruin the bitcoin price and their business, but it’s better not to have to rely on one group of people controlling an entire money system. After all, we have that exact same system with central banking and bitcoin was set up as a decentralized alternative.
So far, no player or conglomerate ever reached that 51 percent threshold, at least not since bitcoin’s very early days, but many market participants always thought Bitmain’s corner of the market is a bit too close for comfort.
This favorable environment for Chinese bitcoin mining has been changing with a crack down on local government electricity largess as well as a crackdown on cryptocurrency.
Bitcoin itself and mining bitcoin remain legal in China but cryptocurrency exchanges have been banned since late 2017.
But more needs to be done for bitcoin to become independent of the caprice of a centralized oppressive regime and local government bureaucrats.

Northern Bitcoin Case Study

Enter Northern Bitcoin AG. The company isn’t the only one which is exploring mining opportunities with renewable energies in locations other than China.
But it is special because of the extraordinary set up it has for its operations, the fact that it is listed on the stock exchange in Germany, and the opportunities for scaling it discovered.
The operations of Northern Bitcoin combine the beauties of bitcoin and capitalism in one.
Like Texas has a lot of oil and free gas and it makes sense to use the gas rather than burn it, Norway has a lot of water, especially water moving down the mountains due to rainfall and melting snow.
And it makes sense to use the power of the movement of the water, channel it through pipes into generators to create very cheap and almost unlimited electricity. Norway generates north of 95 percent of its total electricity from hydropower.

A waterfall next to a hydropowerplant near Sandane, Norway, Oct. 25, 2018. (Valentin Schmid/The Epoch Times)Capitalism does not distinguish between renewable and fossil. It uses what is the most expedient. In this case, it is clearly water in Norway, and gas in Texas.
As a side note on the beauties of real capital and the fact that capital and the environment need not be enemies, the water in one of the hydropowerplants close to the Northern Bitcoin facility is piped through a generator made in 1920 by J.M. Voith AG, a company from Heidenheim Germany.
The company was established in 1867 and is still around today. The generator was produced in 1920 and is still producing electricity today.

Excess Power

In the remote regions of Northern Norway, there aren’t that many people or industry who would use the electricity. And rather than transport it over hundreds of miles to the industrial centers of Europe, the industries of the future are moving to Norway to the source of the cheap electricity.
Of course, it is not just bitcoin mining, but other data and computing heavy operations like server farms for cloud computing that can be neatly packaged into one of those containers and shipped up north.
“The containers are beautiful. They are produced in the middle of Germany where the hardware is enabled and tested. Then we put it on a truck and send it up here. When the truck arrives on the outside we lift it on the container vehicle. Two hours after the container arrives, it’s in the container rack. And 40 hours later we enable the cooling, network, power, other systems, and it’s online,” said Mats Andersson, a spokesman for the Lefdal Mine data center in Måløy, Norway, where Northern Bitcoin has its operations. Plug and play.

A Northern Bitcoin data container inside the Lefdal Mine data center, in Måløy, Norway. (Northern Bitcoin)If the cheap electricity wasn’t enough—around 5 cents per kilowatt hour compared to 17 cents in Germany—Norway also provides the perfect storage for these data containers, which are normally racked up in open air parks above the ground.
Also here, the resource allocation is beautiful. Instead of occupying otherwise useful and beautiful parcels of land and nature, the Northern Bitcoin containers and others are stored in the old Lefdal olivine mine.
Olivine is a mineral used for steel production and looks green. Very fitting. Hence also the name of the data center: Lefdal Mine.
“We take the green mineral out and we take the green IT in,” said Andersson.

Efficiency, Efficiency

Using the old mine as storage for the data center makes the whole process even more resource efficient.
Why? So far, we’ve only been talking about bitcoin mining using a lot of energy. But what for? Before you have actually seen the process in action—and it is similar for other computing operations—you cannot imagine how bizarre it is.
Most of the electricity is used to prevent the computers from overheating. So it’s not even the processors themselves; it’s the fans which cool the computer that use the most juice.
This is where the mine helps, because it’s rather cool 160 meters (525 feet) below sea level; certainly cooler than in the Texas desert.
But it gets even better. On top of the air blow-cooling the computer, the Lefdal data center uses a fresh water system to pump through the containers in pipes.
The fans can then circulate air over the cool pipes which transfer the heat to the water. One can feel the difference when touching the different pipes.
The fresh water closed circle loop then completes the “green” or resource efficiency cycle by transferring its heat to ice cold water from the nearby Fjord.
The water is sucked in through a pipe from the Fjord, the heat gets transferred without the water being mixed, and the water flows back to the Fjord, without any impact on the environment.
To top it all off, the mine has natural physical security far better than open air data centers and is even protected from an electromagnetic pulse blast because it’s underground.

_The Nordfjord near Måløy, Norway. The Lefdal data center takes the cold water from the fjord and uses it to cool the computer inside the mine. (Valentin Schmid/The Epoch Times)_Company Dynamics

Given this superlative set up, Northern Bitcoin wants to ramp up production as fast as possible at the Lefdal mine and other similar places in Norway, which have more mountains where data centers can be housed.
At the moment, Northern Bitcoin has 15 containers with 210 mining machines each. The 15 containers produce around 5 bitcoin per day at a total cost of around $2,500 dollars at the end of November 2018 and after the difficulty of solving the math problems went down by ~17 percent.
Most of it is for electricity; the rest is for leasing the containers, renting the mine space, buying and writing off the mining computers, personnel, overhead, etc.
Even at the current relatively depressed prices of around $4000, that’s a profit of $1500 per bitcoin or $7,500 per day.
But the goal is to ramp it up to 280 containers until 2019, producing 100 bitcoin per day. Again, the company is in the sweet spot to do this.
As opposed to the beginning of the year when one could not procure a mining computer from Bitmain even if one’s life depended on it, the current bear market has made them cheap and relatively available both new and second had from miners who had to cease operations because they can’t produce at low bitcoin prices.

Northern Bitcoin containers inside the Lefdal Mine data center in Måløy, Norway. (Northern Bitcoin)What about the data shipping containers? They are manufactured by a company called Rittal who is the world market leader. So it helps that the owner of Rittal also owns 30 percent of the Lefdal mine, providing preferential access to the containers.
Northern Bitcoin said it has enough capital available for the intermediate goal of ramping up to 50 containers until the end of year but may tap the capital markets again for the next step.
The company can also take advantage of the lower German corporate tax rate because revenue is only recorded when the bitcoin are sold in Germany, not when they are mined in Norway.
Of course, every small-cap stock—especially bitcoin companies—have their peculiarities and very high risks. As an example, Northern Bitcoin’s financial statements, although public, aren’t audited.
The equipment in the Lefdal mine in Norway is real and the operations are controlled by the Lefdal personnel, but one has to rely on exclusive information from the company for financials and cost figures, so buyer beware.

Norway Powerhouse?

Northern Bitcoin wants to have 280 containers, representing around 5 percent of the network’s computing power.
But the Lefdal mine alone has a capacity to power and cool 1,500 containers in a 200 megawatt facility, once it is fully built out.
“Here you have all the space, power, and cooling that you need. … Here you can grow,” said Lefdal’s Andersson.

A mine shaft in the Lefdal Mine data center in Måløy, Norway. The whole mine will have a capacity for 1500 containers once fully built out. (Valentin Schmid/The Epoch Times)The Norwegian government was behind an initiative to bring computing power to Norway and make it one of the prime destinations for data centers at the beginning of this decade.
To that effect, the local governments own part of the utility companies which operate the power plants and own part of the Lefdal Mine and other locations. But even without notable subsidies (i.e. cash payments to companies), market players were able to figure it out, for everybody’s benefit.
The utilities win because they can sell their cheap electricity close to home. The computing companies like IBM and Northern Bitcoin win because they can get cheap electricity, storage, and security. Data center operators like Lefdal win because they can charge rent for otherwise unused and unneeded space.
However, in a recent about face, the central government in Oslo has decided to remove cryptocurrency miners from the list of companies which pay a preferential tax rate on electricity consumption.
Normally, energy intensive companies, including data centers, pay a preferential tax on electricity consumed of 0.48 øre ($0.00056 ). According to a report by Norwegian media Aftenposten, this tax will rise to 16.58 øre ($0.019) in 2019 for cryptocurrency miners exclusively.
The argument by left wing politician Lars Haltbrekken who sponsored the initiative: “Norway cannot continue to provide huge tax incentives for the most dirty form of cryptocurrency output […] [bitcoin] requires a lot of energy and generates large greenhouse gas emissions globally.”
Since Norway generates its electricity using hydro, precisely the opposite is true: No greenhouse gas emissions, or any emissions for that matter would be produced, if all cryptomining was done in Norway. As opposed to China, where mining is done with coal and with emissions.
But not only in Norway is the share of renewable and emission free energy high. According to research by Coinshares, Bitcoin’s consumes about 77.6 percent of its energy in the form of renewables globally.
However self-defeating the arguments against bitcoin mining in Norway, the political initiative is moving forward. What it means for Northern Bitcoin is not clear, as they house their containers in Lefdal’s mixed data center, which also has other clients, like IBM.
“It’s not really decided yet; there are still big efforts from IT sectors and parties who are trying to change it. If the decision is taken it might apply for pure crypto sites rather than mixed data centers, like ours,” said Lefdal’s Andersson.
Even in the worst-case scenario, it would mean an increase from ~5 cents to ~6.9 cents per kilowatt hour, or 30 percent more paid on the electricity by Northern Bitcoin, which at ~$3250 would still rank it among the most competitive producers in the world.
Coinshares estimates the average production price at $6,800 per Bitcoin at $0,05 per kilowatt hour of electricity and an 18-months depreciation schedule, but concedes that a profitable miner could “[depreciate] mining gear over 24-30 months, or [pay] less for mining gear than our estimates.”
Jäger says Northern Bitcoin depreciates the equipment over three years and has obtained very favorable prices from Bitmain, making its production much more competitive than the average despite the same cost of electricity. In addition, the natural cooling in the mine also reduces electricity costs overall.

Cheap Producer Advantage

At the moment, however, the tax could be the least of any miners worry, as the bitcoin price is in free-fall.
But what happens when the price crashes further? Suffice it to say that there was bitcoin mining when the dollar price was less than 1 cent and there will be bitcoin mining at lower prices thanks to the design of the network.
Mao Shixing, the founder of mining pool F2pool estimated 600,000 miners have shut down since the November crash in price, according to a report by Coindesk.
As it should be in a competitive system, the most energy intensive and obsolete machines are shut down first.
As with every other commodity, when the price drops, some miners will leave the market, leaving space for cheaper competitors to capture a bigger share. But with bitcoin this is a bit simpler than with copper or gold for example.
When a big copper player goes bankrupt, its competitors have to ramp up production and increase cost to increase their market share. With bitcoin, if 3,000 computers get taken off the total mining pool, they won’t be able to mine the approximately 5 bitcoin any longer.
However, because the difficulty of solving the computationally intensive cryptographic tasks of bitcoin decreases automatically when there are fewer computers engaged in the task, the other players just have to leave their machines running at the same rate for the same cost and they will split the 5 bitcoin among them.
“The moment the price goes down, our production price will go down as well,” said Jäger, a process that already happened from November to December when the difficulty decreased twice in November and the beginning of December.
This naturally favors players like Northern Bitcoin, which are producing at the lower end of the cost spectrum. They will be the ones who shut down last.
And this is a good thing. The more companies like Northern Bitcoin, and countries like Norway—even with the extra tax—the more decentralized the bitcoin system.
The more computers there are in different hands mining bitcoin, the more secure the system becomes, because it will be ever more difficult for one player to reach the 50 percent threshold to crash the system. It is this decentralized philosophy which has kept the bitcoin system running for 10 years. Whether at $1 or $20,000.
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Sintra Bitcoin ATM Demo In Toronto's Bitcoin Decentral Location using their ATM to buy Bitcoins Bitcoin ATM scam awareness - Stay Safe How to start a Bitcoin ATM business- BaapATM Bitcoin ATM Kosice

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Sintra Bitcoin ATM Demo

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