CheapBitcoin.com : Bitcoin news and Domain names for sale

Providing Bitcoin-related news and Bitcoin domains for sale.

Please go to Buy This Domain to purchase these domain names:

BitcoinDeal.com, BitcoinCommerce.com, BitcoinGuns.com, BitcoinRetail.com, BitcoinRetailers.com, BitcoinSale.com, BitcoinSales.com, BitcoinTicket.com, BitcoinSellers.com, BinaryCoin.com, Bitcoin8.com, Bitcoin9.com, Bitcoinate.com, Bitcoing.com, Bitcoinize.com, Bitcoink.com, BitcoinU.com, Bitcoin4U.com, BitcoinUs.com, MegaBitcoin.com, OrBitcoin.com, Podcoin.com, CuBitcoin.com, Ramcoin.com, Pubcoin.com, Simcoin.com, TiBitcoin.com, Bitcoint.com, GigaBitcoin.com, SuperBitcoin.com, WeBitcoin.com, Bitcoin2Gold.com, Bitcoin2Silver.com, Bitcoin4Silver.com, silver2Bitcoin.com, silver4Bitcoin.com, silverBitcoin.com, BitcoinAccount.com, BitcoinAudit.com, BitcoinAuditor.com, BitcoinAudits.com, BitcoinBug.com, BitcoinBuyers.com, BitcoinCharge.com, BitcoinCheap.com, BitcoinClear.com, BitcoinCents.com, BitcoinDealers.com, BitcoinDimes.com, BitcoinHaven.com, BitcoinHedge.com, BitcoinLenders.com, BitcoinPip.com, BitcoinPledge.com, BitcoinRates.com, BitcoinSave.com, BitcoinSavers.com, BitcoinSavings.com, BitcoinSell.com, BitcoinSpread.com, BitcoinSwaps.com, BitcoinTicker.com, BitcoinTrend.com, BitcoinTrends.com, BitcoinWire.com, btcBanking.com, btcFund.com, btcTrades.com, cashBitcoin.com, CheapBitcoin.com, CheapBitcoins.com, clearBitcoin.com, deBitcoin.com, escrowBitcoin.com, escrowcoin.com, forexBitcoin.com, gold2Bitcoin.com, sendBitcoin.com, Bitcoinsure.com, Bitcoins4free.com, BitcoinBot.com, BitcoinBots.com, BitcoIntel.com, BitcoinCoder.com, BitcoinCoders.com, BitcoinDesk.com, BitcoinDev.com, BitcoinDns.com, BitcoinEmail.com, Bitcoinet.com, BitcoinHack.com, BitcoinHacks.com, BitcoinKeys.com, BitcoinLib.com, BitcoinLog.com, BitcoinLogin.com, BitcoinLogs.com, BitcoinPlugin.com, BitcoinServer.com, BitcoinSniffer.com, BitcoinTool.com, BitcoinTools.com, BitcoinAssist.com, BitcoinBackup.com, BitcoinCop.com, BitcoinCrypt.com, BitcoinConnect.com, BitcoinDonate.com, BitcoinDrop.com, BitcoinExperts.com, BitcoInform.com, BitcoinGuard.com, Bitcoinnect.com, BitcoinValet.com, BitcoinPolice.com, BitcoinCorp.com, BitcoinLaw.com, BitcoinMaker.com, BitcoinPad.com, BitcoinSearch.com, BitcoinService.com, BitcoinSpy.com, BitcoinStealth.com, BitcoinStorage.com, BitcoinStudy.com, BitcoinTest.com, remoteBitcoin.com, saferBitcoin.com, safercoin.com, fastBitcoin.com, BitcoinTrace.com, BitcoinTrack.com, quickBitcoin.com, simpleBitcoin.com, work4Bitcoin.com, Bitcointer.com, Bitcoinote.com, BitcoinLock.com, SatoshiNakamoto.com, BitcoinBlocks.com, BitcoinMill.com, Bitcoinomics.com, Bitcoinomy.com, Bitcoinism.com, Bitcoinist.com, BitcoinBetters.com, BitcoinUp.com, BingoBitcoin.com, BitcoinBidding.com, BitcoinBooker.com, BitcoinBookie.com, BitcoinBookies.com, BitcoinBookmaker.com, BitcoinCasinos.com, BitcoinGambler.com, BitcoinGamblers.com, BitcoinHall.com, BitcoinJoker.com, BitcoinLand.com, BitcoinPlace.com, BitcoinPlay.com, BitcoinPlayer.com, BitcoinPlayers.com, BitcoinPlays.com, BitcoinPrize.com, BitcoinWager.com, BitcoinWin.com, casinoBitcoin.com, BitcoinCity.com, pokerBitcoin.com, winBitcoins.com, BitcoinBrothel.com, BitcoinElite.com, BitcoinGirl.com, BitcoinGirls.com, BitcoinLadies.com, BitcoinVIP.com, BitcoinWomen.com, escortBitcoin.com, escortsBitcoin.com, MissBitcoin.com, BitcoinBook.com, BitcoinFan.com, BitcoinMag.com, BitcoinStudio.com, BitcoinMovie.com, BitcoinArmy.com, BitcoinChurch.com, BitcoinDown.com, BitcoinLight.com, BitcoinParties.com, BitcoinWars.com, BitcoinWave.com, HexCoin.com,

What is Bitcoin?

Bitcoin is a digital crypto-currency with no single point of failure due to its decentralized peer-to-peer architecture. The source code is publicly available and changes to the reference Bitcoin client are made via concensus within the community. Advantages of Bitcoin include irreversible transactions (i.e. no possibility of chargebacks as with credit cards), pseudo-anonymous, limited and fixed inflation, near instant transactions, multi-platform, no double-spend and little to no barriers to entry and more. It was created by an anonymous person known as Satoshi Nakamoto. Find out more at WeUseCoins.com.

Bitcoin Latest News

Major Magazine Publisher to Accept Bitcoin Payments

Posted on 18 December 2014 | 12:43 pm

Microsoft accepts Bitcoin

Posted on 11 December 2014 | 5:06 am

Mozilla accepting Bitcoin

Posted on 20 November 2014 | 1:55 pm

PayPal and Virtual Currency

Posted on 23 September 2014 | 9:52 pm

Wikimedia Foundation Now Accepts Bitcoin

Posted on 30 July 2014 | 3:14 pm

German Newspaper "taz" accepts Bitcoin

Posted on 22 July 2014 | 1:32 pm

Bitcoin Core version 0.9.1 released

Posted on 8 April 2014 | 4:27 pm

Bitcoin v0.9.0 released

Posted on 19 March 2014 | 6:44 am

Mt.Gox Statement

Posted on 3 March 2014 | 3:44 am

Cointelegraph Article on Businesses' Objections to Bitcoin Features Free Keene Blogger - Free Keene


Free Keene

Cointelegraph Article on Businesses' Objections to Bitcoin Features Free Keene Blogger
Free Keene
Cointelegraph is the most recognizable news source in the bitcoin universe – each of their articles features a cartoon graphic that is custom-drawn for the piece. One of the reporters for Cointelegraph is Joel Valenzuela, a Free State Project early mover.

Posted on 10 February 2016 | 3:32 pm

Princeton University Releases First Draft of Bitcoin Textbook - CoinDesk


The Register

Princeton University Releases First Draft of Bitcoin Textbook
CoinDesk
The first complete draft of an upcoming Princeton University textbook on bitcoin is now available. Bitcoin and Cryptocurrency Technologies takes comprehensive look at the technology behind bitcoin. The free download is the first complete draft of the ...
Crypto connoisseurs: Curl up with Princeton's 300-page ode to BitcoinThe Register
Princeton Releases Bitcoin TextbookCryptoCoinsNews
Princeton Bitcoin Textbook Available Online, To Be Published In SummerEconoTimes

all 6 news articles »

Posted on 10 February 2016 | 12:04 pm

Bitcoin Price Analysis: Exuberant Advance - CryptoCoinsNews


CryptoCoinsNews

Bitcoin Price Analysis: Exuberant Advance
CryptoCoinsNews
Bitcoin price made a return to the previous wave high today and now looks to have resumed an advance. Or has it? This analysis is provided by xbt.social with a 3-hour delay. Read the full analysis here. Not a member? Join now and receive a $29 discount ...

Posted on 10 February 2016 | 11:53 am

Will the Upcoming Mining Reward Halving Impact Bitcoin's Price? - Bitcoin Magazine


Bitcoin Magazine

Will the Upcoming Mining Reward Halving Impact Bitcoin's Price?
Bitcoin Magazine
The reward for mining Bitcoin is expected to see the second halving in its history later this year, potentially in June or July. Bitcoin, a deflationary store of value as opposed to reserve currencies and fiat-money, has had its total supply limited to ...

and more »

Posted on 10 February 2016 | 10:48 am

Bitcoin Weekly 2016 February 10: Steam getting Bitcoin payments, Simplex $7m Series A, Coin Center raises $1m ... - SiliconANGLE (blog)


SiliconANGLE (blog)

Bitcoin Weekly 2016 February 10: Steam getting Bitcoin payments, Simplex $7m Series A, Coin Center raises $1m ...
SiliconANGLE (blog)
Bitcoin may be getting a boost with a potential unfolding partnership between Valve Corporation and BitPay, Inc.! Redditors have discovered payment code in Valve's video game distribution platform Steam that will allow bitcoin payments for US customers.

Posted on 10 February 2016 | 10:23 am

Want Your Own Version of Bitcoin? Hire This Guy - Bloomberg


Bloomberg

Want Your Own Version of Bitcoin? Hire This Guy
Bloomberg
Jeff Garzik, one of about two dozen core bitcoin developers, is capitalizing on the hype by creating a coder-for-hire service specializing in the blockchain. His startup Bloq Inc. charges customers $3,000 to $5,000 a month to develop new features for ...

and more »

Posted on 10 February 2016 | 8:15 am

21 Inc Launches Bitcoin Transaction Fee Prediction App - CoinDesk


AllCoinsNews.com (blog)

21 Inc Launches Bitcoin Transaction Fee Prediction App
CoinDesk
21 Inc, maker of the Bitcoin Computer, has launched a free web app that can help bitcoin users determine what level of fee will ensure a transaction is confirmed in a given amount of time. The new service, which can be found at bitcoinfees.21.co ...
21 Inc Launches Bitcoin Fee CalculatorThe Merkle (blog)
Gavin Andresen Announces First Bitcoin Classic Release – “Doubling Transaction Capacity”AllCoinsNews.com (blog)
Blockchain is about to transform everything we know about banking and doing businessFinancial Post

all 6 news articles »

Posted on 10 February 2016 | 7:38 am

Bitcoin group scores funds from biggest names in industry - Yahoo Finance


Yahoo Finance

Bitcoin group scores funds from biggest names in industry
Yahoo Finance
Bitcoin-related businesses raised more venture capital money in 2015 than in any year before: $485 million, according to industry news site CoinDesk. And yet, even as they court more VC interest, these companies continue to deal with skepticism from ...

and more »

Posted on 9 February 2016 | 10:36 am

Bitcoin is on the verge of splitting in two - The Verge


The Verge

Bitcoin is on the verge of splitting in two
The Verge
Bitcoin is in the midst of a civil war. It has been simmering for some time, though it remained largely out of view to the general public until last month, when a prominent Bitcoin developer announced that the cryptocurrency and the technology ...

and more »

Posted on 9 February 2016 | 8:28 am

Bitcoin Classic Publishes Code That Could Double Bitcoin's Block Size

The first release for the alternative bitcoin implementation of Bitcoin Classic has been published.

Posted on 10 February 2016 | 3:59 pm

IBM Director Declares 'We’re All in on Blockchain'

IBM blockchain director John Wolpert appeared at a conference in San Francisco today where he gave a keynote speech.

Posted on 10 February 2016 | 1:15 pm

Princeton University Releases First Draft of Bitcoin Textbook

The first complete draft of an upcoming Princeton University textbook on bitcoin has been made freely available for download.

Posted on 10 February 2016 | 12:04 pm

Online Retailer Overstock Spent $8 Million on Blockchain Projects in 2015

Online retailer Overstock.com has announced that it spent $8m last year on its blockchain-backed securities trading initiative.

Posted on 10 February 2016 | 11:02 am

21 Inc Launches Bitcoin Transaction Fee Prediction App

21 Inc has launched a free web app that can help bitcoin users determine what level of fee will ensure a transaction is confirmed.

Posted on 10 February 2016 | 7:36 am

Compliance Expert Juan Llanos Joins Blockchain Analytics Firm

Financial compliance authority Juan Llanos is joining blockchain analytics firm Coinalytics as the executive vice president of business development.

Posted on 10 February 2016 | 6:59 am

Linux Foundation-Led Blockchain Project Grows to 30 Members

A distributed ledger effort being led by the Linux Foundation now has 30 members, up from 20 when it was announced in December.

Posted on 9 February 2016 | 10:30 am

US Bankruptcy Court Set to Weigh in on Bitcoin's Currency Status

A California bankruptcy court is set to weigh in on when or if bitcoin should be considered a currency in a dispute over a HashFast payment.

Posted on 9 February 2016 | 9:46 am

Why Microsoft Wants 'Every Blockchain' on its Azure Platform

Microsoft's head of technology strategy opens up about the firm's plans to carve out a market position in the blockchain space.

Posted on 9 February 2016 | 4:17 am

Inside Earthport's Bid to Push Banks Past Blockchain R&D

CoinDesk looks at how Earthport is adding blockchain technology to existing product lines through its Distributed Ledger Payments Hub.

Posted on 8 February 2016 | 11:21 am

Bitcoin Group Stock Exchange Debut Delayed Again

Bitcoin Group Ltd has once again been forced to delay its public listing on the Australian Securities Exchange, despite its recent IPO.

Posted on 8 February 2016 | 10:11 am

Five UK Mutual Funds Partner on Blockchain Trading Project

Five major UK fund houses have reportedly partnered on a project to explore blockchain technology's cost saving potential in trading systems.

Posted on 8 February 2016 | 7:40 am

Bitcoin: A 21st Century Currency Explained By a Wall Street Veteran

Wall Street veteran Jason Leibowitz answers questions about how bitcoin was created, how it works and why it matters.

Posted on 7 February 2016 | 12:30 pm

How Blockchain Tech is About to Transform Sharemarket Trading

How the Australian Securities Exchange's investment in blockchain startup Digital Asset Holdings could influence the company's offerings.

Posted on 7 February 2016 | 9:00 am

The Bitcoin Block Size Debate Isn't Just About Technology

The views of the Bitcoin Core developers are not the only ones that should count when deciding its future, says developer Elliott Olds.

Posted on 7 February 2016 | 6:38 am

Bitcoin Earns Reputation for Poor Payments Standards Participation

Bailey Reutzel examines how the bitcoin community's reluctant to engage over standards could harm the digital currency in the long term.

Posted on 6 February 2016 | 8:15 am

Alaskan 'Judge' Wants Pope Francis to Endorse the Blockchain

An Alaskan conservative commentator and self-styled judge has called for the world to embrace blockchain technology.

Posted on 5 February 2016 | 4:01 pm

Hyperledger Project Looks at Options to Build Blockchain Technology with IBM, DTCC, SWIFT, and Others

Earlier this week Bitcoin Magazine reported that the Linux Foundation announced technical updates to the new Hyperledger Project, a formal open governance structure, as well as new members from across the industry.

The Hyperledger Project wants to develop a new open source blockchain separated from the Bitcoin blockchain. Digital Asset Holdings, the fintech startup headed by the financial superstar Blythe Masters, contributed its Hyperledger mark, which it had acquired in June with the purchase of San Francisco-based digital fintech company Hyperledger.

The Hyperledger team, now part of Digital Asset Holdings, developed distributed ledger technology for private blockchains, without a built-in digital currency, to allow financial operators to clear and settle transactions in real time, using a proven consensus algorithm capable of thousands of transactions per second.

The placeholder domain hyperledger.com now redirects to the official Hyperledger website hyperledger.org.

The updated list of Hyperledger founding members consists of 28 top companies in the technology and financial services space. It appears that the Linux Foundation’s Hyperledger Project is moving very fast and is on its way to becoming a leading force in the blockchain technology development space.

Founded in 2000, the Linux Foundation wants to be the organization of choice for the world's top developers and companies to build ecosystems that accelerate open technology development and commercial adoption.

The technology of the original Hyperledger team is independent of Bitcoin, and many companies in the new Hyperledger Project support radical alternatives to Bitcoin. For example, Accenture and Digital Asset Holdings CEO Masters, among others, expressed support for private, “permissioned” non-Bitcoin blockchains.

“To be used by financial institutions, including capital markets firms and insurers, blockchains must supplant the costly methods introduced by Bitcoin with a mechanism that guarantees security, privacy and speed without paying for anonymous consensus,” said two Accenture executives in July.

In other words, Bitcoin should disappear and be replaced by a closed blockchain. So is Hyperledger a first step in that direction?

Bitcoin Magazine reached out to the Linux Foundation for clarifications and further explanations.

"The Linux Foundation believes a shared infrastructure that is open to critical inspection and collaboration will be pivotal in driving global adoption of blockchain for distributed ledgers," Linux Foundation executive director Jim Zemlin told Bitcoin Magazine. "I’m extremely bullish about how the developers involved in Hyperledger Project are openly looking at various architectures, concepts and technologies, aiming to integrate code from a variety of sources to build a neutral technology that can work for all."

Zemlin also answered some specific burning questions about the nature, plans and policies of the Hyperledger Project.

Bitcoin Magazine: Does the Hyperledger Project support a specific (existing or planned) digital currency for payments and financial applications?

Zemlin: No, the scope of the Hyperledger Project is limited to the development of the underlying blockchain fabric that can support a broad range of use cases. Applications and domain-specific frameworks are outside the scope of the project, but will obviously be encouraged to leverage the project's deliverables.

Bitcoin Magazine:Is the Hyperledger Project a replacement for Bitcoin and/or other existing cryptocurrencies?

Zemlin:This project’s mission will be to build and advance a general purpose blockchain framework that can be used across industry sectors, from financial services to retail to manufacturing and more. There is ample room in the market for cryptocurrencies and even multiple implementations of the blockchain, but everyone stands to lose if these don’t interoperate and work together. The hope would be that the fabric produced by the Hyperledger Project can satisfy a broad set of use case ranging from cryptocurrencies, supply-chain visibility, asset transfer, IoT, business contracts and so much more. We'll see thousands of applications and many uses cases, but open source and industry-wide collaboration are essential to realizing the full potential of distributed ledger technology.

Bitcoin Magazine:Do you plan to implement full programmability with a Turing-Complete scripting language to support transactions and smart contracts of arbitrary complexity?

Zemlin: One of the proposals on the table in the technical community supports execution of code written in any language. However, the community has not yet reached consensus on this point.

Bitcoin Magazine: What's your position on the privacy issue?

Zemlin: It is important to realize that the Hyperledger Project is hosted by the Linux Foundation, but the community that has gathered to support and lend their resource and expertise to develop this key technology is just now coalescing and does not yet have a singular point of view.

The Hyperledger Project continues to unfold. Bitcoin Magazine will follow further developments.

The post Hyperledger Project Looks at Options to Build Blockchain Technology with IBM, DTCC, SWIFT, and Others appeared first on Bitcoin Magazine.

Posted on

Will the Upcoming Mining Reward Halving Impact Bitcoin’s Price?

The reward for mining Bitcoin is expected to see the second halving in its history later this year, potentially in June or July.

Bitcoin, a deflationary store of value as opposed to reserve currencies and fiat-money, has had its total supply limited to 21 million bitcoins since the original code released by Satoshi Nakamoto in 2008. Unlike fiat currencies that can be printed at will by central banks, the total supply of bitcoins is fixed by the consensus rules of the system. Because of its deflationary nature, the digital currency is often compared to precious metals such as gold, which also undergo a resource-intensive creation or mining process.

This process of mathematically securing transactions in a block of chains called mining requires a tremendous supply of computing power and electricity. In exchange for securing the Bitcoin network and processing transactions, the protocol currently rewards these miners with 25 bitcoins for every block of transactions found. However, this reward for miners will soon be cut in half from 25 bitcoins to 12.5 bitcoins. This “halving” will occur at block 420,000, which is expected to be mined in the middle of 2016.

Surge or Stability?

The decline of miner’s reward simply means that the Bitcoin network will begin to generate bitcoins at a much slower rate. If the demand for bitcoin remains constant through the year while the supply is cut in half, simple economics dictates that the price should rise until there is a new equilibrium between supply and demand. Whether or not this supply change is already a factor in the price of bitcoin is a point of disagreement.

Some argue that the Bitcoin community has been fully aware of the halving of miners’ reward for a long time and that the actual decline in the supply of bitcoins will not surprise most Bitcoin enthusiasts and traders in the community.

Historically, halving of miner’s reward has had no substantial effect on the price of Bitcoin. On November 28, 2012, the first time the miners’ reward was halved, there was no visible impact on the value of Bitcoin, which was worth around USD $13.40 per bitcoin.

This occurred when block 210,000 was solved.

Considering the historical result of the “halving day” and the increasing awareness of Bitcoin, it is difficult to predict whether the price of Bitcoin will surge or maintain its stability after the halving of miner’s reward.

As Bitcoin security expert and author of Mastering Bitcoin Andreas Antonopoulos explains, the impact of halving on the price of Bitcoin depends on a wide range of factors, including the difficulty and transaction volume of Bitcoin.

“I can't predict price. No one can. Anyone who does, even for 10 minutes, is lying,” said Antonopoulos. “The reward halving will change the inflation rate in Bitcoin. How that affects the overall economy depends on the conditions of all the other parameters in the economy: price, adoption, transaction volume, hashrate, difficulty, investments, other currencies, world market conditions, etc.”

The post Will the Upcoming Mining Reward Halving Impact Bitcoin’s Price? appeared first on Bitcoin Magazine.

Posted on

Blockchain Startups Take Aim at Counterfeiting of Luxury Products

This post is by Krystle Vermes​.

The cryptocurrency industry has delivered new technology to the world of luxury commerce, and it’s helping weed out the fakes.

It may seem like a frivolous concern, but counterfeit goods are big business. Stopping them is a significant business cost for manufacturers of the real thing. And for consumers who pride themselves on owning luxury goods, getting the real thing is essential to a way of life.

That's where Bitcoin comes in.

“By linking digital certificates to purchased goods, we are able to provide a much higher degree of confidence to buyers, especially when purchasing from online or second-hand retailers,” says Guy Halford-Thompson, founder of Blockchain Tech Ltd.

The company uses blockchain technology to create a secure registry, tracking who owns designer products. In turn, the database has everything a consumer needs to determine whether the product in hand is actually what it’s supposed to be.

With blockchain technology, individuals can track the entire journey of the item from assembly to vendor.

“While some consumers may be looking to purchase more affordable 'look-alikes,’ the concern comes from consumers who are looking to purchase genuine items, but because of the advances in manufacturing processes, it can be very difficult to distinguish between real and look-alike,” Halford-Thompson continued. “This is not a large concern when purchasing from known high-street stores, but it becomes a huge issue when consumers are looking to purchase new or second-hand items off online marketplaces.”

Although obtaining luxury goods is seemingly easier than ever before thanks to the Internet, not every seller is playing by the rules. Halford-Thompson says that watches, handbags and sunglasses are the most counterfeited items he’s seen on the market. However, he has confidence in blockchain and “smart tagging.”

“Smart tagging will provide consumers with a better brand experience, and a higher degree of confidence in the items they are buying,” Halford-Thompson adds.

And he isn’t the only one who feels this way.

“In five years, encrypted chips will be in all of your luxury consumer goods,” says Ryan Orr, CEO of Chronicled. “It’s not ‘if,’ but ‘when.’”

Similar to Blockchain Tech Ltd., Chronicled is a company that uses smart tags to track authentic sneakers that hit the market. With the Chronicled mobile app, shoe shoppers can scan the smart tag of the product and get all of the information about its authenticity in a matter of seconds.

As of right now, Orr claims that Air Jordan 11s and Yeezys are the most commonly counterfeited shoes. He adds, however, that his company is raising the stakes for counterfeiters by providing even more security to consumers.

“By combining blockchain technology and smart tags, undetectable forgery becomes impossible, and wearing fakes becomes socially risky,” Orr said.

But is doing the “uncool” thing by counterfeiting goods going to be enough to persuade people to stop? In the end, the answer may be “yes” for a majority of consumers.

“Trusted sneaker sellers earn at least a 20 percent premium, and it’s not just the ‘buy’ side of the transaction that affects consumers,” Orr points out. “Most of us don’t even consider trying to sell our authentic used luxury goods on the Internet because we know we won’t get fair value.”

However, there’s no doubt that counterfeiters are getting better.

“Wait until they start 3-D printing,” Orr warns.

Counterfeiters might always have a new trick, but blockchain technology will now be chasing the bad guys. Maybe, in the foreseeable future, it can even get ahead of them.

The post Blockchain Startups Take Aim at Counterfeiting of Luxury Products appeared first on Bitcoin Magazine.

Posted on

Linux Foundation's Hyperledger Blockchain Project Announces New Members and Governance Structure

In December Bitcoin Magazine reported that a group of top tech and finance companies are joining forces with the Linux Foundation to develop a new open source blockchain separated from the Bitcoin blockchain. Digital Asset Holdings, the fintech startup headed by the financial superstar Blythe Masters, contributed its Hyperledger mark.

Last week, IBM started to reveal some details of its blockchain projects and strategy. John Wolpert, IBM’s blockchain offering director, said that Hyperledger code will become an open source industry standard, and developers will be able to build applications on top of Hyperledger. At the forthcoming Block Chain Conference on February 10 in San Francisco, Wolpert will give a keynote presentation titled “How to Make Block Chain Real for Business.” The address will focus on IBM’s point of view in this space and its contribution to the open source community led by the Linux Foundation.

Things are moving fast in the Hyperledger space. The Linux Foundation is announcing new members from across the industry, technical updates to the new Hyperledger Project and a formal open governance structure. “Think of it as an operating system for interactions,” says the new Hyperledger Project website. “It has the potential to vastly reduce the cost and complexity of getting things done.

“The Hyperledger Project has ramped up incredibly fast, a testament to how much pent-up interest, potential and enterprise demand there is for a cross-industry open standard for distributed ledgers,” said Jim Zemlin, executive director at The Linux Foundation. “Working on its own, even the largest global corporation could not match the speed at which our new members are moving blockchain technology forward. Such a broad effort and investment is sure to have a great impact on our personal and professional lives.”

A board of directors will guide business/marketing decisions and ensure alignment between the technical communities and members of the Hyperledger Project. Technical contributions to the project are welcome at any time, from anyone, and will be reviewed by the newly formed Technical Steering Committee (TSC), which is composed of industry-leading technical experts. Nominations are currently open for TSC members.

The announcement notes that the Hyperledger Project is a collaborative effort to focus on an open platform that will satisfy a variety of use cases across multiple industries to streamline business processes. Peer-to-peer in nature, distributed ledger technology is shared, transparent and decentralized, making it ideal for application in finance and countless other areas such as manufacturing, banking, insurance and the Internet of Things (IoT). “By creating a cross-industry open standard for distributed ledgers, virtually any digital exchange with value, such as real estate contracts, energy trades or marriage licenses, can securely and cost-effectively be tracked and traded,” says the Linux Foundation.

The Hyperledger Project has received proposed contributions from several companies, including Blockstream, Digital Asset, IBM and Ripple. Other community members are contemplating contributions of their own.

“The formation of Hyperledger marks a milestone in the advancement of distributed ledger technology,” said Digital Asset CEO Blythe Masters. “Digital Asset believes that it is vital for shared infrastructure to be open to critical inspection and collaboration, and this initiative will be pivotal in driving the global adoption of solutions to real-world problems.”

The updated list of Hyperledger founding members consists of 28 top companies in the technology and financial services space: ABN AMRO, Accenture, ANZ Bank, Blockchain, Calastone, Cisco, CLS, CME Group, ConsenSys, Credits, The Depository Trust & Clearing Corporation (DTCC), Deutsche Börse Group, Digital Asset Holdings, Fujitsu Limited, Guardtime, Hitachi, IBM, Intel, J.P. Morgan, NEC, NTT DATA, R3, Red Hat, State Street, SWIFT, Symbiont, VMware and Wells Fargo.

“The development of blockchain technology has the potential to redefine the operations and economics of the financial services industry,” said Richard Lumb, chief executive of Accenture’s Financial Services. “It emerges at an important time, as the industry strives to be leaner, more efficient and more digital. Open source development will accelerate the innovation and help drive the scalability of this technology, and we are proud to support the Hyperledger Project.”

Other statements by Hyperledger founding members focus on the non-banking applications of blockchain technology.

“We at Fujitsu are confident that blockchain technology will accelerate disruptive change, not only in the financial industry, but also in many other industries where it will be put to active use,” said Fujitsu Senior Vice President Takahito Tokita.

“We believe blockchain will quickly mature and spread to more industries,” said Masayoshi Ogawa, President of Hitach’s Financial Information Systems Division.

Other statements are available in the Linux Foundation press release. It appears that the Linux Foundation’s Hyperledger Project is moving very fast and is on its way to become a leading force in the blockchain technology development space.

Founded in 2000, the Linux Foundation wants to be the organization of choice for the world's top developers and companies to build ecosystems that accelerate open technology development and commercial adoption.

Photo Drupal Association / Flickr(CC)

The post Linux Foundation's Hyperledger Blockchain Project Announces New Members and Governance Structure appeared first on Bitcoin Magazine.

Posted on

The Rise of User-Monetized Actions: Bitcoin's Killer Application

This article is an op-ed by Andrew DeSantis and the views expressed are those of the author.

On January 9th, 2007 the world as we know it was forever changed. Apple Computer CEO Steve Jobs took the stage at the Moscone Center in San Francisco and introduced the world to the iPhone.

Nine years later, many have trouble remembering what life was like before the rise of mobile. The average smartphone today is more than one million times smaller, one million times more affordable and one thousand times more powerful than a $60 million supercomputer was 40 years ago. As a result of successive radical innovation, we have truly changed the world, but more important, the world has forever changed us.

In 1998, when asked what keeps him up at night, Bill Gates had a surprising answer. As the CEO of Microsoft, one might have expected him to say Apple, Oracle or even Netscape. Instead he stated: “I worry about someone in a garage inventing something that I haven’t thought of.” Unbeknownst to Gates, at that very moment Larry Page and Sergey Brin were hard at work in a garage in Menlo Park. The fruit of their labor would go on to become Google.

Gates, like many of us, has accepted that change, particularly technological change, is one of the few constants in life and even the smartest among us can be caught by surprise.

Bitcoin Is Born

On January 3rd, 2009, less than two years after Jobs unveiled the iPhone, Satoshi Nakamoto sent an email to the renowned “Cryptography Mailing List” titled “Bitcoin v0.1 released.” The email contained a SourceForge link to the first Bitcoin reference client and the following statement:

“Announcing the first release of Bitcoin, a new electronic cash system that uses a peer-to-peer network to prevent double spending. It’s completely decentralized with no server of central authority.”

Nakamoto then went on to give a brief summary of Bitcoin’s implementation and explicitly add a disclaimer stating that the included software was still alpha and experimental.

When Jobs introduced the iPhone he had the attention of the entire tech world. Everyone knew the device would be a game changer, but no one could have predicted that five years later the iPhone would catalyze the creation of a ride-hailing application called Uber. Today Uber has an estimated worth of $62.5 billion, higher than that of car makers GM, Ford and Honda, and could very well go on to become the world’s first trillion-dollar company.

Nakamoto’s announcement on the other hand went relatively unnoticed by the public, but a handful of dreamers immediately realized the ramifications of Satoshi’s vision. The first to respond to Nakamoto’s email was cypherpunk legend Hal Finney. Three days later on January 12, Nakamoto executed the first Bitcoin transaction, in block 170, sending 10 bitcoins to Finney.

In May of 2010, roughly a year and a half after Bitcoin’s genesis block was mined by Nakamoto, two members of the BitcoinTalk community forum executed the first real-world purchase. 10,000 BTC for a $25 pizza. Five and a half years have since passed and with a near six-billion dollar market capitalization, it is safe to say that Bitcoin come a long way. But there is still a ways to go.

Bitcoin Grows Up

Since 2013 the Bitcoin industry has to a degree operated in stealth mode. Companies like 21 Inc, BitGo and Blockstream have been hard at work in collaboration with the Bitcoin Core developers to ready Bitcoin for the next and brightest stage of its life thus far. In the words of software legend Joel Spolsky, “Good software takes 10 years. Get used to it.”

21 Inc’s CEO, Dr. Balaji S. Srinivasan, stated the following in a lecture at Stanford Universityprior to founding 21:

“A good founder is capable of anticipating which turns lead to treasure and which lead to certain death. A bad founder is just running to the entrance of (say) the ‘movies/music/filesharing/P2P’ maze or the ‘photo sharing’ maze without any sense for the history of the industry, the players in the maze, the casualties of the past, and the technologies that are likely to move walls and change assumptions.”

So what about Bitcoin is likely to “move walls” and “change assumptions?” While user-monetizable data is of significant importance to Bitcoin’s future, the concept of “user-monetizable actions” is of far greater importance.

The DARPA Network Challenge

At 10 a.m. EST on December 5th, 2009 (this date was picked to commemorate the 40th anniversary of the Internet) the Defense Advanced Research Projects Agency (DARPA), known for creating the ARPANET, a precursor to the Internet and contributing to the onion protocol used by the Tor network, launched 10 red balloons in undisclosed locations across the continental United States. A month earlier DARPA proposed an open challenge to teams across the nation. The first team to locate all 10 balloons and report their findings to DARPA would receive a $40,000 reward. What happened next exceeded the researchers’ wildest expectations.

Less than nine hours after DARPA launched the balloons a team from MIT won the competition. How did they do it? By embracing the concept of user-monetizable actions.

In 2005, Jon Kleinberg, of the Department of Computer Science at Cornell University, and Prabhakar Raghaven of Yahoo! Research published a paper titled “Query Incentive Networks.” In it they state:

“The concurrent growth of online communities exhibiting large-scale social structure, and of large decentralized peer-to-peer file-sharing systems, has stimulated new interest in understanding networks of interacting agents as economic systems. Here we formulate a model for query incentive networks, motivated by such systems: users seeking information or services can pose queries, together with incentives for answering them, that are propagated along paths in a network. This type of information-seeking process can be formulated as a game among the nodes in the network, and this game has a natural Nash equilibrium. In such systems, it is a fundamental question to understand how much incentive is needed in order for a node to achieve a reasonable probability of obtaining an answer to a query from the network.”

Building off the ideas presented in Kleinburg and Raghavan’s research, the team from MIT came up with the following strategy:

“We’re giving $2000 per balloon to the first person to send us the correct coordinates, but that’s not all – we’re also giving $1000 to the person who invited them. Then we’re giving $500 to whoever invited the inviter, and $250 to whoever invited them, and so on.

It might play out like this. Alice joins the team, and we give her an invite link like http://balloon.media.mit.edu/alice. Alice then e-mails her link to Bob, who uses it to join the team as well. We make a http://balloon.media.mit.edu/bob link for Bob, who posts it to Facebook. His friend Carol sees it, signs up, then twitters about http://balloon.media.mit.edu/carol. Dave uses Carol’s link to join … then spots one of the DARPA balloons! Dave is the first person to report the balloon’s location to us, and the MIT Red Balloon Challenge Team is the first to find all 10. Once that happens, we send Dave $2000 for finding the balloon. Carol gets $1000 for inviting Dave, Bob gets $500 for inviting Carol, and Alice gets $250 for inviting Bob. The remaining $250 is donated to charity.”

In essence the MIT team designed a recursive algorithm executed by willing participants by redistributing the prize money to the participants in such a way that a power incentive structure came to life.

While the MIT team’s accomplishment is significant, particularly from the perspective of academia, it wasn’t the only major insight derived from the DARPA Network Challenge. Hacker George Hotz, known as geohot, in 2007 was the first person to carrier-unlock an iPhone. Hotz later went on to jailbreak Sony’s PlayStation 3. Hotz recently made headlines when he and a writer from Bloomberg Businessweek took a drive around the San Francisco Bay area in a self-driving car he built alone in just a month. An hour prior to the start of the DARPA Network Challenge, Hotz tweeted to his then roughly 50,000 followers asking for their assistance in locating the balloons. Through his network Hotz located four ballons; he was then able to trade information with other teams ultimately bringing his balloon count to eight.

The approach taken by the MIT team displays the raw power that a properly designed algorithm can have outside as well as inside the confines of Silicon. Hotz’s approach, on the other hand, allows us to contrast the academic perspective with that of a single hacker wielding influence over a network of individuals.

If one combines the two approaches, by using Bitcoin to send microtransactions to their own network of followers, what you end up with is a variant of Kleinberg and Raghavan’s Query Incentive Network model that allows one to execute MapReduce-like operations over a large network of willing participants.

The Power of End-User Monetization

We can change our perspective, yet again, and view things through the eyes of an end user performing tasks on behalf of another individual. While this sounds like a new concept it really isn’t. Celebrities have monetized their actions on Twitter and Facebook for years. The musician Jared Leto and socialite Kim Kardashian have reportedly received payments as high as $13,000 per tweet for promoting products that fall in line with their personal brand.

Until now, it hasn’t financially made sense for a user with a few thousand followers to receive payments for endorsements. Additionally, most celebrities tend to rely on agents who cut deals with sponsors on their behalf. Even if the average user put in the effort to build a network of sponsors, it is highly unlikely that a sponsor would want to deal with a user whose follower count is below 100,000. As with most scenarios that rely on the ability to perform microtransactions, the pre-Bitcoin banking system isn’t designed to handle small, fast, international transactions.

Earlier this week Srinivasan presented his thoughts on the future of user-monetizable actions. After presenting scenarios such as the Twitter covered above and derivatives such as a Bitcoin-based, decentralized version of Fiverr, he left two questions to ponder:

  • What would life be like if even while you were asleep an autonomous agent handled requests that earned Bitcoin on your behalf?

  • What would you do with your own personal army of willing, waiting, able and ready individuals?

Final Thoughts

The Bitcoin Engineering class at Stanford University has gone tremendously well. Likely because a majority of the students enrolled in the course have little to no previous knowledge about Bitcoin, they will be able to leverage the abstractions provided by the 21 Bitcoin Computer’s two1 Python3 library and quickly rhapsodize applications into existence without the burden of knowledge (fatigue) many of us have accumulated over the years.

A computer science student named Axel Ericsson hacked together his own tunneling protocol allowing him to securely communicate with his 21 Bitcoin Computer from a web browser. While a future release of the two1 library will likely support browser-to-machine BitTransfers triggered by 402 requests, today the 21 Bitcoin Computer is being used for machine-to-machine transactions. Most likely, Axel executed one of the world’s first 402 request transactions initiated from a web browser in exchange for user-monetizable data.

The post The Rise of User-Monetized Actions: Bitcoin's Killer Application appeared first on Bitcoin Magazine.

Posted on

World's First Bitcoin Mining IPO Misses Target by AUD $14 Million

This post is by Benjamin Roussey

The first fundraising in the world for an initial public offering of a Bitcoin mining company has raised 5.9 million Australian dollars, (USD $4.2 million) – falling short of its target of AUD $20 million.

Based in Melbourne, the Bitcoin Group announced last week that it had raised AUD $5,927,168.40 in a bookbuild of its Australian Stock Exchange (ASX) listing. The company also announced that it was still progressing though the listing process with ASX.

Even though the amount raised was less than a third of the amount it tried for, CEO of Bitcoin Group Sam Lee called it a “solid result.”

During an interview on CNBC on Tuesday, Lee said the amount raised is sufficient for the company to execute its current strategy of acquiring new mining equipment to expand its footprint.

Although it was scheduled to take place on Tuesday, Bitcoin Group has not yet announced its quote on the ASX. It is expected that the company will trade under the ticker BCG.

The price of shares was at AUD $0.20, with AUD $2,000 as the minimum subscription. There is no maximum subscription. According to the Australian Taxation Office, Bitcoin is an asset for capital gains tax purposes.

This is the first time a publicly listed entity has been led by the Bitcoin Group Management since its incorporation in September 2014. Lee, the CEO, has a background in financial services and digital media.

On CNBC, Nicolas Debock, a venture capitalist at Balderton Capital in London, said he would need to think twice before investing in a Bitcoin mining firm, as it has a number of risks. He added that many venture capitalists have invested in Bitcoin in the last three years, but there still has been no money coming out.

Bitcoin Group produces approximately 1.2 percent of the world’s Bitcoin mining output, with six mining sites in Iceland and China. Due to the affordability of electric supply in China, a large percentage of its operations are conducted in China. However, since it is significantly lacking in diversification, the company could be left vulnerable to changes in regulations resulting from the Chinese stance on Bitcoin.

If the company had raised the AUD $20 million it had hoped for, the plan was to use AUD $18 million as an investment in equipment and facilities for Bitcoin mining. The remaining AUD $2 million was to be used for general corporate purposes, including costs for listing.

On CNBC, Debock said that a large number of people still believe in Bitcoin in the long term, whether it is the technology or the asset.

The post World's First Bitcoin Mining IPO Misses Target by AUD $14 Million appeared first on Bitcoin Magazine.

Posted on

On the Detriments of Segregated Witness for Bitcoin

Segregated Witness has been the center of Bitcoin’s long-lasting scaling debate since it was first introduced by Blockstream co-founder and Bitcoin Core developer Dr. Pieter Wuille two months ago.

A nifty method to move signature data from typical transactions into “add-on blocks,” Segregated Witness is set to improve the Bitcoin protocol in several ways . Moreover, the solution can be rolled out as a soft fork, meaning that only miners need to upgrade their software; all other nodes can do so if and when they please.

The innovation is positioned as the first step of a scalability “roadmap ” as set out by Bitcoin Core, and is supported by a large segment of Bitcoin's development community.

But Segregated Witness is not free of controversy. Rather than a Segregated Witness soft fork, the recently launched alternative Bitcoin implementation Bitcoin Classic plans to increase Bitcoin's block size limit to 2 megabytes through a hard fork, meaning all full nodes on the network need to upgrade synchronously.

These are the arguments against a Segregated Witness soft fork – and their counterarguments.

It Requires 'Ugly' Code

A purist argument against Wuille's proposal is that a Segregated Witness soft fork constitutes an “ugly” workaround of code. Most important, it uses parts of the miner-generated coinbase transaction for purposes they were not originally intended for. The added complexity could potentially cause new problems as the protocol keeps evolving.

The counterarguments

While most developers agree a hard fork would be a cleaner solution, this does not necessarily mean a Segregated Witness soft fork is unsafe. The Bitcoin Core development team has rolled out several similar soft forks in the past, and maintains that this one would not carry any more risk.

A hard fork, meanwhile, renders all existing full node software incompatible with newer full node software, which is, arguably, not very graceful either.

It Burdens Developers Too Much

A Segregated Witness soft fork workaround imposes an added burden on developers -- both now and in the future. This is particularly true for Bitcoin library and wallet developers, as they will need to adapt their software to integrate Segregated Witness. This will require more effort than a hard fork block size increase would.

The counterargument

Most current library and wallet developers don't seem to consider the added burden a big problem. Many are even quite excited about the innovation, and they typically consider the added benefits worth the effort. (See Bitcoin Magazine 's development series, as linked below in this article.)

Growth of Added Block Space Will Be Slow

Like Bitcoin Classic’s proposed hard fork, Segregated Witness theoretically offers up to 1 megabyte of added block space, for a total of 2 megabytes. But this optimal added capacity is based on multisig transactions, as these get an accounting “discount.” Yet most transactions are currently not multisig transactions. A more realistic capacity increase could therefore be closer to .6 megabytes of added space, for a total of 1.6 megabytes.

Additionally, this added space might not be fully utilized right away. It can be used only after wallets and other apps have upgraded. In reality, it could take a while before even 1.6 megabytes is reached.

And while the Segregated Witness soft fork is scheduled for April, it remains to be seen if this can be achieved. The solution requires much coding and testing before it can be rolled out, as well as approval by miners.

The counterarguments

A public testnet version of Segregated Witness – SegNet – is already available for experimention. This suggests that development is on schedule.

Many library and wallet developers, moreover, estimate that it would take anywhere between a couple of days to several weeks to integrate Segregated Witness. An April release should, therefore, provide enough time for the bulk of wallet and app software to upgrade.

As soon as Segregated Witness is activated, all wallet and app software can utilize the benefits – such as lower fees – immediately. Whether other users utilize the added space as well does not not really matter for them. (And if the added block space is not used, it might just suggest that the need for extra block space was never that great in the first place.)

It should also be noted that multisig transactions might find increasing use as innovation and development of the Bitcoin protocol progresses, because added layers on top of Bitcoin – such as payment channels and the Lightning Network – typically use such transactions. The effective capacity could, therefore, come closer to 2 megabytes later on.

And while the Bitcoin Classic team maintains that a hard fork can be rolled out before April, this is considered overtly aggressive and outright risky by many within the development community. The need for all full node operators to both review and adopt the upgrade, they think, requires at least six months to a year.

It Skews Incentives

Removal of signatures from the original 1-megabyte blocks can effectively increase Bitcoin’s block size. But Segregated Witness does introduce a new type of maximum block size. Roughly: A block without the witness, plus one quarter of the witness size, must not exceed 1 megabyte. As such, upgraded nodes will see blocks that exceed 1 megabyte, since the actual size of the Segregated Witness is larger than the quarter accounted for.

This means that multisig transactions, which include more signature data, get a greater discount. And since multisig transactions are used to establish layers on top of Bitcoin, Segregated Witness artificially skews incentives toward these added layers.

Long-term consequences of such layers – such as the effect on mining fees – are controversial.

The counterarguments

Discounting signature data is how Segregated Witness allows for added block space without requiring a hard fork. While this is indeed accomplished through an accounting measure, it is a useful one.

Additionally, witness data can be reasonably considered expendable after a certain amount of time, decreasing the need for full nodes to store it in perpetuity. It, therefore, has a lower cost to the network, making it reasonable to charge a lower fee.

Furthermore, the only way Bitcoin can reach millions of users while also remaining decentralized, secure and censorship-resistant is through the use of added layers. Incentivizing development and use of these added layers is not a bad thing.

It Doesn't Hold Well Under Adversarial Conditions

One argument in favor of a block size limit concerns block propagation and latency. In short: Bigger blocks tend to increase orphan rates, as more miners build on old blocks while newer blocks are still making their way through the network. This, in turn, favors larger miners (or pools): They find more blocks themselves, and start building on these right away, meaning they waste fewer resources.

This also means that large miners could have an incentive to actually create artificially large blocks, specifically designed to increase the orphan rate of competitors.

The current Segregated Witness proposal allows blocks up to about 2 megabytes – though a bit less is more likely. But due to the specific accounting measure to be employed, so-called “selfish miners” could create synthetic transactions designed to stuff up to 4 megabytes of data into a single block. As such, big miners could “attack” competitors with valid 4 megabyte blocks.

Segregated Witness, therefore, requires miners and full nodes to deploy hardware with 4-megabyte safety headroom, while getting significantly less real transaction capacity in return. And if the original block size limit is increased through a hard fork at some point in the future, this risk multiplyer will probably remain.

The counterarguments

If 4 megabytes is indeed large enough to successfully pull off an attack – which is unclear – this attack would require the attacking miner to discard all real transactions. The resulting loss of fees serves as a slight disincentive to carrying out such an attack, and it would be obvious to the rest of the network that an attack is going on.

And while the risk multiplier will probably indeed remain even if a hard fork is rolled out later on, it could potentially be decreased through a soft fork as well.

It Degrades Security of Non-upgraded Nodes

A fifth concern is that a Segregated Witness soft fork would degrade the security of all non-upgraded full nodes. These nodes could still accept Segregated Witness transactions, or transactions that depend on a previous Segregated Witness transaction, but be unable to verify whether the signature data is valid. As such, they'd have to rely on validation by miners.

Unconfirmed Segregated Witness transactions would, therefore, be insecure, as these are not yet verified by miners at all.

But even confirmed Segregated Witness transactions would be less secure, as miners could purposely mine invalid transactions into blocks with the intention to double-spend non-upgraded nodes. A non-upgraded node would believe these blocks to be valid until the miners switch their hash power back to the valid chain. If a non-upgraded node accepted transactions from the invalid blocks, he might have lost money.

The costs of such a double-spend would resemble the cost of any other 51-percent-attack, but with added leverage. Attacking miners could potentially leverage hash power from “SPV-miners,” who wouldn't know what's going on themselves, since they don't validate transactions either. And the attacker could leverage funds to double-spend, as he could use any Segregated Witness-protected bitcoin that never belonged to him in the first place.

The counterarguments

A Segregated Witness soft fork will be publicly announced far in advance, and transparently voted on by miners. As such, any user running a full node will have plenty of time to take the necessary precautions.

Users running a non-upgraded node should not trust zero-confirmation transactions. But zero-confirmation transactions were always unsafe. Anyone who wants to pull off a double-spend attack with unconfirmed transactions can do so with or without Segregated Witness.

The added risk of confirmed transactions, meanwhile, can be offset by waiting for some additional number of confirmations. (For exact figures of the added risks, see these calculations by Bitcoin developer Oleg Andreev.)

A user who does not want to upgrade to the newest full node status at all, furthermore, could patch his non-upgraded full node with software that flags suspicious transactions – and potentially even reject such transactions completely.

Last, it should be noted that hard forks pose a much greater risk of double-spend transactions. Any non-upgraded node could, in the case of a hard fork, receive completely invalid transactions while potentially never realizing it at all.

It Will Be Deployed without Explicit User Consent

Though arguably small, the security degradation as described above does exist. And what's perhaps more important: This security degradation would be enforced without explicit consent from users. Even if users strongly oppose Segregated Witness, and prefer not to upgrade, a majority of miners could push the change through regardless.

This is at odds with Bitcoin’s promise of personal autonomy; the idea that operators of a full node should always have the possibility to opt-out of any change.

The counterarguments

Soft forks cannot be prevented. Miners controlling a majority of hash power can always decide to enforce new rules, as long as they do not break the existing consensus rules. This is inherent to the Bitcoin protocol, and will be possible after a hard fork just as well.

As such, users running full nodes must always bear some responsibility. Either the responsibility to upgrade to the latest version of the software, or the responsibility to wait for an added number of confirmations, or perhaps even the responsibility to not accept any transactions after a soft fork is detected.

And while it’s technically true that users don’t need to change their software after a (contentious) hard fork, and can choose to “stay behind” on the original network, this will almost certainly not be the option in practice. Besides the risk of double-spend attacks, decreased hash power could ensure that transactions never confirm – or confirm very slowly.

An alternate scenario is that the minority chain by hash power introduces its own hard fork to change the proof-of-work algorithm. Bitcoin would then split up into two separate networks, and all users would have to upgrade their software to support one of the options – or both.

Thanks to Jonathan Toomim and Ciphrex CEO, Bitcoin Core, and Segregated Witness developer Eric Lombrozo for proofreading and added feedback.

For more information on Segregated Witness, see Bitcoin Magazine's series on the subject, or part 1, part 2, part 3, part 4, part 5, part 6, part 7 and part 8 of Bitcoin Magazine's development series.

The post On the Detriments of Segregated Witness for Bitcoin appeared first on Bitcoin Magazine.

Posted on

IBM Supports Linux Foundation's Hyperledger Blockchain as Industry Standard, Plans Deployment

In December Bitcoin Magazine reported that IBM and a group of top tech and finance companies are joining forces to develop a new open source blockchain separated from the Bitcoin blockchain. The group will work with the Linux Foundation to create a public network that lets blockchain applications built on top of it communicate with each other.

Digital Asset Holdings, the fintech startup headed by the financial superstar Blythe Masters, is contributing its Hyperledger mark, which will be used as the project name, as well as enterprise grade code and developer resources. Digital Asset Holdings bought San Francisco-based Hyperledger in June.

Now IBM is starting to reveal some details of its blockchain projects and strategy.

In an interview with IT analyst David Strom published in IBM’s online magazine Security Intelligence, John Wolpert, IBM’s blockchain offering director, said that IBM will eventually have hundreds of developers working on various blockchain projects. IBM didn’t invent blockchain technology but plans to take a leading role in its development, with an approach similar to IBM’s Java developments.

“[Java] wasn’t our technology, but we got behind it and put an army against it,” Wolpert said. “At its height, thousands were working on Java-related projects.”

Wolpert is responsible for engineering, products and open source initiatives at IBM. Previously, he was head of products for IBM’s Watson Ecosystem – IBM’s ambitious Artificial Intelligence (AI) project – and a successful entrepreneur before joining IBM.

At the forthcoming Block Chain Conference on February 10 in San Francisco, Wolpert will give a keynote presentation titled “How to Make Block Chain Real for Business.” The address will focus on IBM’s point of view in this space and its contribution to the open source community led by the Linux Foundation. The open source community is aimed at accelerating the maturity of this shared ledger technology, through a collective, open and coordinated approach.

Wolpert said that Hyperledger code will become an open source industry standard, eventually available on Github just like other open-source software, and developers will be able to build applications on top of Hyperledger.

“There are going to be lots of people who will compete on providing solutions,” he said. “We will try to get the best minds across the industry to work together on this code.”

Developers will be able to deploy Hyperledger applications on the IBM Cloud, a collection of fully integrated services to help IBM clients use data across all digital channels to understand their customers and anticipate their needs. According to the company, IBM Cloud is the first full spectrum cloud built on open technologies, with the world’s most advanced analytics and cognitive computing toolbox.

“We intend to be the best place and fastest place to get blockchain technologies running,” said Wolpert. “We are moving assets on a massive scale in ways that we never thought of before and doing so automatically and without any human intervention. It isn’t just the data, but using the transaction log of the data in new and interesting ways.”

The recent U.K. Government Office for Science report ““Distributed Ledger Technology: Beyond Block Chain” noted that the strong association of blockchain technology with Bitcoin represents an important problem when it comes to communicating the potential benefits of distributed ledgers.

Wolpert agrees, and adds that many banks and other traditional financial institutions were hesitant to be associated with blockchains because of Bitcoin. But IBM’s strategy is more focused on non-banking applications of blockchain technology.

“Now people are talking about how they can use blockchains without endorsing any shadow currencies, and everyone is excited,” said Wolpert. “It has gone beyond being a fad.”

Wolpert is persuaded that blockchain technology could have many important non-currency applications, and, in particular, that it could be a solid foundation for more efficient supply chain networks.


Photo Patrick / Flickr(CC)

The post IBM Supports Linux Foundation's Hyperledger Blockchain as Industry Standard, Plans Deployment appeared first on Bitcoin Magazine.

Posted on

February 10, 2016 -
Real Time Analytics