Kik Messaging App Now Has New Owner, Will Continue Work on Kin Token

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With 18 Million Bitcoins Mined, How Hard Is That 21 Million Limit?

In a matter of hours, the 18 millionth bitcoin will have been mined and the world’s first cryptocurrency will draw one step closer to its hard-coded cap of 21 million coins.

“The pie is shrinking. This [milestone] gives people some simple math to raise awareness about where we’re at in the [bitcoin mining] process,” said Alex Adelman, CEO of bitcoin rewards platform Lolli, adding:

“It’s good for people to see the progress of bitcoin, to look back on everything that has been done and will be done for the next 3 million. … You should pay attention to the next 3 million.”

But don’t worry, you’ll have 120 years to do so.

The next 3 million bitcoins will be progressively slower to mine as a result of block reward halvings which occur every 210,000 blocks (or roughly four years) and reduce new bitcoin supply by 50 percent. The final bitcoin is expected to be mined in 2140.

Or is it?

It seems blasphemous even to go there, given bitcoin’s value proposition as digital gold. But outsiders foresee a day when the 21 million cap might, gasp, come up for debate.

Eventually, once there are no more bitcoins left to mint, miners will rely solely on transaction fees, which are paid by users to transfer coins through the blockchain. This change gives cause for concern to some who view bitcoin’s block subsidies as integral to bitcoin’s incentive system.

To skeptics, this could undermine the structure that motivates miners to record validated transactions in the ledger.

“All of your assumptions about incentives, risk and value go out the window,” said Angela Walch, a research fellow at the University College London Centre for Blockchain Technologies. “Please take the blinders off and stop assuming that everything will still work well once everything goes to a pure transaction-fees system as opposed to block [subsidy].”

Currently, with each block, miners get a subsidy of 12.5 newly created BTC, worth roughly $99,370, plus any additional transaction fees, which normally don’t total more than 1 BTC. 

Along the same lines, Paul Brody, global innovation leader for audit firm Ernst & Young (EY), said bitcoin’s limited supply could limit the cryptocurrency’s utility as a global reserve currency.

Pointing to situations such as the Great Recession where monetary policy interventions were needed to lift the U.S. out of economic turmoil, Brody said:

“If bitcoin were to become a substantial part of the global monetary system, we would need to address [the hard supply cap] because a lot of economists agree deflationary systems are not necessarily the best thing.”

What next?

Both Walch and Brody suggested that bitcoin’s 21 million supply cap might one day be subject to change. What if?

“We need to acknowledge that the 21 million cap is aspirational,” said Walch. “If people decide to change that [supply] cap for certain reasons and enough people make that decision, the system will move to it. It’s aspiration, not reality.”

While technically feasible, a change to the supply cap would almost certainly be a non-starter for bitcoin users who cherish its gold-like properties. Indeed, bitcoin’s code has long been governed by a community with a bias toward retaining the coin’s original features as created by its pseudonymous founder, Satoshi Nakamoto.

Unlike ethereum, the world’s second-largest cryptocurrency, the bitcoin blockchain has rarely seen backward-incompatible, system-wide upgrades changing core code features.

In the rare instances it has, the bitcoin community has gone through fierce governance disputes – such as the infamous scaling debates of 2017, which centered on a potential increase to bitcoin’s block size. The philosophical rift ultimately resulted in the creation of bitcoin cash in August 2017.

Still, a prospective hard fork that would change bitcoin’s 21-million-coin supply cap is conceivable, if perhaps heretical.

“It’s not a given that bitcoin has to stay at that 21 million hard limit,” said EY’s Brody (who, it should be noted, is building enterprise applications on top of rival chain ethereum). “There is a governance mechanism to permit changes in bitcoin – if the community agrees that would be good.”

The other side

Even so, bitcoin advocate and author Andreas Antonopoulos stressed that governance drama surrounding bitcoin’s supply cap is nothing to lose sleep over – especially since bitcoin’s transition to a purely transaction-fee rewards model will take 120 years.

Antonopoulos added that from the very launch of bitcoin in 2009, mining was always “a marginally profitable endeavor” never intended to stay constant.

“[Mining rewards] dynamically adjust based on the network. … It’s a very complex economic environment. It’s not as simple as people think,” said Antonopoulos, adding:

“There are half a dozen variables that determine miner profitability [right now] including the cost of electricity, their access to bandwidth transaction, the block subsidy, the transaction fees at the time, bitcoin price, their local currency exchange rate, the type of equipment and how efficient it is at converting electricity into mining.”

As such, Antonopoulos says the concerns surrounding a transition from a block subsidy to purely transaction-based block rewards are grossly overblown.

“Nothing magical happens when block subsidy drops to zero,” said Antonopoulos. “It’s a very gradual and predictable change that happens over a period of 120 years. It’s already happening and every day [miners] make their decisions.”

While the 18th million bitcoin may not be the best reminder of the ongoing reality of a limited supply cap, the next upcoming milestone on bitcoin’s horizon assuredly will.

Viewing the next bitcoin halving as a far more notable event in bitcoin’s history, venture capitalist William Mougayar said:

“In my opinion, [the 18 million] milestone is not that significant in relation to the next halving which occurs May 2020. … On that date, the block [subsidy] will go from 12.5 BTC to 6.25 BTC.”

Andreas Antonopoulos image via Christine Kim for CoinDesk

Analysts Target $6,200 as Bitcoin Faces Bearish Technicals

After a short period of upwards momentum earlier this week that appeared to be bull’s attempt to bolster Bitcoin’s price action, bears have once again gained the upper hand and have now pushed BTC’s price decisively below $8,000.

One prominent technical analyst is now noting that he believes this latest movement downwards points to the possibility that a movement towards the lower-$6,000 region is imminent, which may be further validated by multiple bearish technical formations that crypto is currently expressing.

Bitcoin Plummets Below $8,000 as Bears Roar

At the time of writing, Bitcoin is trading down roughly 2% at its current price of $7,960, which marks a notable retrace from its daily highs of nearly $8,200 that were set yesterday.

Although BTC had long found noteworthy support around the lower-$8,000 region, its inability to garner any upwards momentum during its time in this region was a bearish sign that elucidated that bulls were incurring were losing their strength.

In the near-term, it is important to note that Bitcoin is highly likely to incur further bearishness as it faces weak technical strength.

Josh Olszewicz, a popular crypto analyst on Twitter, explained in a tweet that the latest drop was sparked when it was denied at its 200-day EMA, and that a daily death cross is close to forming.

“4h $BTC – still in 3+ week range – straight down since denial at 200DEMA – daily death cross soon – daily bbands tight & rdy to expand down – unconfirmed bull div here,” he said.

Analyst: BTC May Target $6,200 Next

The bearishness that Bitcoin has incurred during its recent bout of sideways trading and subsequent drop below $8,000 may extend significantly further, as Olszewicz is further noting that an accurate fractal pattern may signal that a movement to $6,200 is imminent.

“12h $BTC: alligator/fractal again calling for short entry on this candle close in a few hours (if the body is lower than fractal wick). TP for short according to multi-year PF = 6.2-6.9 based on Q1 diag,” he said while pointing to the chart seen in the below tweet.

Assuming that Bitcoin does drop lower in the near term and forms the death cross that is currently looming over the horizon, then it may drop significantly further before it finds enough momentum to spark the next multi-month uptrend.

Featured image from Shutterstock.

Craig Wright: Either I’m Satoshi Nakamoto, or He Plagiarized Me

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Telegram Offers to Postpone Launch of the TON Network

Telegram Offers to Postpone Launch of the TON Network

Telegram Offers to Postpone Launch of the TON Network

Telegram, which was surprised with a last minute restraining order on the sale of its tokens in the U.S., is now ready to delay the launch of the TON network until the spring of next year. The company has informed the New York court reviewing the case that it can suspend all operations with grams until the legal issues around the coin offering are resolved.

Also read: 104 Addresses Hold 70% of Tether, Research Reveals

Messenger to Halt Operations With Grams

Lawyers representing Telegram Group and its wholly-owned subsidiary, Ton Issuer Inc., have filed documents containing their clients’ proposal to the District Court for the Southern District of New York, Tass reported. The entities behind the Telegram Open Network (TON) have also expressed disagreement with some of the demands put forward by the U.S. Securities and Exchange Commission (SEC).

On October 11, the regulator announced that it had obtained a temporary restraining order for Telegram’s ICO. The court will conduct a hearing on the case on October 24. Due to the legal proceedings, the company now offers to effectively freeze the blockchain project. Before the SEC filed its lawsuit, TON was scheduled to launch by the end of this month.

Telegram Offers to Postpone Launch of the TON Network

The court has already satisfied some of the SEC’s demands regarding Telegram’s plans. The regulator claims the messaging platform held an unregistered offering of TON’s native GRM tokens. In two private sales between January and March 2018, Telegram sold the rights to 2.9 billion coins to 171 investors worldwide for $1.7 billion. The total includes a billion tokens bought by 39 U.S. residents for $424.5 million.

Telegram is now proposing to halt the sale and transfer of its cryptocurrency for a period of five months to give the court enough time to resolve the legal issues. In the recent filing, it also declared its commitment to inform the Securities and Exchange Commission 30 days before it starts any operations with the gram tokens.

SEC Rejects Proposal

Telegram’s petition to the district court notes that over the past 18 months the company has voluntarily cooperated with the commission and requested its feedback regarding the launch of TON and gram. Its developers even introduced changes to the blockchain platform to address some of the concerns expressed by the SEC.

The lawyers disagree with the regulator’s opinion that gram is a security and insist the token has to be regarded as a currency. The Skadden, Arps, Slate, Meagher & Flom law firm, which represents the messenger, has asked the court to relieve Telegram of the obligation to meet a number of demands and respond to new requests for additional information from the SEC.

However, in its own petition to the court, the commission argues that a postponement of the launch would not be enough. The regulator claims that such arrangement would allow Telegram to continue to commit offenses. If the court does not establish the appropriate prohibitions for the duration of the proceedings, future violations related to the distribution of gram are guaranteed, the SEC insists.

Telegram Offers to Postpone Launch of the TON Network

Investors Asked to Vote on April 30 Deadline

Reaching out to the participants in the two fundraising rounds held last year, Telegram has updated investors on the situation around the TON project and its disagreement with the SEC’s arguments. In recent correspondence with investors, the company asked them to share their position on the proposed extension of the deadline for the network.

In case the majority agrees, the messenger plans to proceed with a new launch date before April 30, 2020, using the time to make additional investments and further develop the blockchain platform. However, if either of the two groups of investors disagrees with the delayed start, they will be partially compensated and fewer gram tokens will be issued at launch.

Do you think the majority of TON investors will agree with the newly proposed deadline for the launch of Telegram’s blockchain? Share your expectations in the comments section below.


Images courtesy of Shutterstock.


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Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Bulgaria, which sometimes finds itself at the forefront of advances it cannot easily afford. Quoting Hitchens, he says: ”Being a writer is what I am, rather than what I do.“ International politics and economics are two other sources of inspiration.

Stablecoins May Hinder Anti-Money Laundering Efforts, Financial Watchdog Says

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Stablecoins May Hinder Anti-Money Laundering Efforts, Financial Watchdog Says

financial-watchdog-says-stablecoins-may-hinder-anti-money-laundering-efforts

The proliferation of stablecoins – such as Facebook’s Libra, underpinned by physical assets – may undermine efforts to stamp out money laundering and the financing of terrorism, according to a global financial watchdog.

Speaking to reporters in Paris, Xiangmin Liu, president of the Financial Action Task Force (FATF), said that both the stablecoin and the companies that issue them would be subject to global standards on cryptocurrencies and traditional financial assets, Reuters reported. He added:

If stablecoins were to become widespread, it could potentially lead to new risks regarding money laundering and terrorist financing. It is our job to ensure the new risks in connection with stablecoins will be adequately addressed.

G7 Report on Stablecoins

Liu’s remarks come just a day after the G7 published a report on stablecoins – saying they appear more capable than cryptocurrencies such as bitcoin of providing a store of value and, therefore, serving as a means of global payment. 

However, it also addressed issues of regulatory and legal risk, and said stablecoins such as Libra must comply with global regulators and lawmakers to ensure these risks are addressed before launch. Libra is scheduled to launch in the first half of 2020.

The Libra Association responded to these calls on Friday, saying it would “operate with transparency and in partnership with regulators” and said policymakers must give regulators “time and space to develop appropriate regulations”.

 

Featured Image Credit: Photo via Pixabay.com

Dollar Deposits On Binance.US Now Have FDIC Insurance Coverage

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Banco Santander Transforming Madrid with DLT

Banco Santander Transforming Madrid with DLT

Spanish bank Banco Santander has launched a $20 million bond on the blockchain. The financial institution has also partnered with the Madrid City Council to develop a blockchain-powered application that will enable citizens to pay transport fare from a unified platform, according to an EnterpriseTimes report on October 18, 2019.

Bond on the Blockchain

Per the report, Banco Santander has forged ahead with a distributed ledger technology (DLT) initiative it began in 2016, to launch a $20 million bond on the on a distributed ledger.

According to the bank, the bond will only exist on the blockchain, and it marks the first step of possibly launching a secondary market for tokenized securities in the near future. Reportedly, Banco Santander is the issuer of the bond, and Santander Corporate and Investment Banking (SCIB), its global division, is working alongside the team.

Notably, the bond which will expire in a year is powered by the ethereum smart contracts blockchain.

Blockchain Bond Attracts Investors

Further reports reveal that a unit of Santander Group has already purchased the bond at market price, and the bond has a quarterly coupon of 1.98 percent. Also, the cash used to complete the investment and the coupon has been tokenized on the blockchain.

Commenting on the blockchain initiative, José García Cantera, Banco Santander’s CFO, said its $20 million bond is evidence that Santandar is at the forefront of the digital transformation of the financial sector.

“We want to take advantage of any technology that accelerates that process so that our clients progress and are faster and more efficient, and the blockchain is one of those technologies,”

Managing Transportation with DLT

In other news, Banco Santander has partnered with Vottun, a blockchain certification authority company, to launch a DLT-powered unified digital payment system for transport in the Spanish city of Madrid.

The team has hinted that the integration of DLT into the city’s transport system is part of the Madrid in Motion initiative, started by Empresa Municipal de Transportes de Madrid, a public transport company.

The application will also be used by commuters to pay for public rides, including buses, taxis, car rentals, e-scooters, and more within the city.

As such, the unified system will reduce the duplication of processes for users, eliminate the difficulty of trying to aggregate data about commuter transit patterns and enable the city’s management to function more efficiently.

Banco Santander remains one of the financial institutions exploring the potential of revolutionary blockchain technology.

On October 4, 2018, BTCManager informed that Banco Santander was hatching plans to launch a blockchain platform for cross-border payments.

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Tor Browser Malware May Have Stolen Users’ Bitcoin For Years

Researchers have identified malware associated with an unofficial version of the Tor Browser. Evidence suggests that the covert software has been tricking users into sending Bitcoin to addresses under the control of scammers.

The Tor Browser is the most popular method used to access the dark web. Many visitors to the dark web often use Bitcoin or other cryptocurrencies to buy illicit goods or services.

Has Tor Browser Been Stealing Your Bitcoin?

According to a report in Forbes,  a trojanised version of the Tor Browser has been circulating amongst Russian-speaking dark web users unnoticed for years. The software is used to access a hidden part of the internet known as the dark web. The compromised version is believed to have been used mostly with the three most popular Russian dark web markets, as well as a national money transfer service, QIWI.

The malware-infected software, downloaded in place of the official Tor Browser, allows those behind it to not only see which pages a user visits but also to change Bitcoin addresses on those pages. Given that the most common use of the Tor Browser software is to visit dark web markets, this could have been a very lucrative scam indeed.

Anton Cherepanov, a senior researcher behind the discovery from the internet security company ESET, commented the following on the newly-discovered malware:

“In theory, they can change the content of the visited page, grab the data the victim fills in to forms and display fake messages, among other activities. However, we have seen only one particular functionality–changing the bitcoin and cryptocurrency wallets.”

The researcher continued, stating that it would be very difficult for non-technical users to tell the difference between the genuine Tor Browser and the one infected with malware.

So far, ESET researchers claim to have confirmed 4.8 stolen Bitcoin (around $40,000 at the time of writing) using the malware. These funds were found in three Bitcoin wallets. The researchers point to the large numbers of relatively small transactions as signs that these wallets were used as part of the scam. Although not a massive haul, the real figure of profit generated could be far higher, as Cherepanov acknowledged:

“It should be noted that the real amount of stolen money is higher because the trojanized Tor Browser also alters QIWI wallets.”

Bitcoin has long been associated with dark net market places. One of the incidents that first brought the cryptocurrency mass attention was the law enforcement operation against the original dark web marketplace, Silk Road. However, as NewsBTC reported yesterday, authorities are getting increasing savvy at catching those using Bitcoin for illicit purposes. Analysis of the Bitcoin blockchain actually helped to bring to justice hundreds involved in what has been described as the largest child pornography ring ever.

 

Related Reading: Bitcoin Made Busting Dark Child Porn Ring Easy For US Justice Department

Featured Image from Shutterstock.

Two More US Jurisdictions Launch Blockchain-Based Mobile Voting

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