Day: July 30, 2017

Both Poloniex and Bitfinex pull out their service from Washington state due to recent legislations and operational license requirements while Gemini stays

Ever since the Bitcoin Cash hard fork was announced, many people have viewed its token as “free money.” While it is true these new tokens will be issued to users at no additional cost, they are most certainly not free money. In fact, many people feel Bitcoin Cash will take away some of Bitcoin’s value, just as Ethereum Classic did to Ethereum. Although the value of BCH has yet to be officially determined, it is not free money in the way most envision it.

There Is No Free Money in Bitcoin

The fact that every holder of Bitcoin is entitled to his or her share of Bitcoin Cash tokens does not make it free money. BCH tokens will be issued at a 1:1 rate to Bitcoin. If you own 100 Bitcoin, you will receive 100 Bitcoin Cash. Those new tokens can then be sold on supporting exchanges, either against Bitcoin or fiat currencies. However, the value of these tokens may be effectively subtracted from the Bitcoin price at that time.

Let’s put this into numbers for a minute. One Bitcoin Cash is currently valued at around US$400. These tokens do not exist currently, and IOU values always betray actual prices until the tokens are available in an official capacity. However, assuming they retain their US$400 value when the tokens are live, that means that value may be deducted from the Bitcoin price at that moment.

If one Bitcoin is worth US$2,800 by the time the split happens, and BCH is worth US$400, it is not unlikely Bitcoin would drop to US$2,400 on that day. The value for BCC has to come from somewhere, and deducting it from the regular Bitcoin price would seem the most logical course of action. With two competing forks, the value of the Bitcoin network — the market cap, in this case — will be distributed over the two blockchains. The actual values of both currencies will fluctuate heavily over the first few days following August 1st.

It is impossible to tell how many people will be ditching Bitcoin in favor of Bitcoin Cash. Hashrate is growing as we speak, yet it seems the altcoin will still be a very minor fork for the time being. It is equally possible users will support both Bitcoin and Bitcoin Cash at the very same time. There is no real reason to defect from one chain to the other, as one can easily support both. There will be users who ditch one chain in favor of the other, although it is too early to tell how things will evolve.

All of this hinges on whether or not Bitcoin and Bitcoin Cash will respect Metcalfe’s Law. Cryptocurrency is an interesting market and predicting the future is and will remain impossible. There is no guarantee Bitcoin will lose or gain value when the hard fork occurs, as it is all guesswork at this point in time. The value of Bitcoin Cash will have to come from somewhere, though. There will most likely be some impact on the Bitcoin price, yet it remains to be seen what the repercussions will be.

Free money does not exist in Bitcoin. Even if Bitcoin were to lower US$50 in value and BCC was worth the same amount, there was no free money to begin with. It just meant the existing value got shifted around a bit. Things will not be as cut-and-dry, though, as the value from BCH will most likely cause big losses to Bitcoin in one way or another. This assumes, of course, that Bitcoin Cash sticks around for some time, which may not be the case. Free money does not exist, even though everyone is entitled to the upcoming “airdrop.”

Ethereum Weekly Price Analysis

Ethereum Weekly Price Analysis

EY held its first Blockchain Hackathon at the Bombay Stock Exchange in Mumbai, India from July 28 to 30 to explore further applications of Blockchain globally.

We have seen multiple versions of Bitcoin ransomware over the past few years. It feels like a new one comes out almost every week, regardless of how successful it is. SpongeBob, the children’s cartoon character, is not something most people would associate with malicious software, but that may soon change. There is now a SpongeBob ransomware in circulation, and it is the second version of this tool.

What Is the Deal With SpongeBob Ransomware 2.0?

The objective of this particular developer was to use a globally recognized brand and turn it into something associated with nefarious software. Dubbing a ransomware strain after the SpongeBob character is distasteful. However, it ensures this malware gains some immediate media attention, including ours. In truth, the ransomware is not well-known for its technical prowess.

We never came across a SpongeBob ransomware 1.0 strain ourselves. It seems there is little information about that particular malware, which goes to show it was not much of a success or never made it to the distribution stage in the first place. Version 2.0 may not fare that much better, as this software leaves a lot to be desired from a technical standpoint. It seems the ransomware itself will not do all that much.

According to various security researchers, SpongeBob Ransomware 2.0 can’t even properly encrypt computer files. We have seen multiple other malware types struggle with this basic feature as well. What is the point in developing ransomware if it cannot encrypt files to demand successful payments from victims? It appears SpongeBob ransomware 2.0 is still in the early development stages, even though it may never be properly distributed at all.

It certainly looks as if SpongeBob ransomware 2.0 took a page out of the book of WannaCry. Its layout looks virtually the same as the popular ransomware strain which caused global havoc not too long ago. There are a few minor differences between SpongeBob ransomware 2.0 and WannaCry, including the color schemes as well as the former’s including a crooked image of SpongeBob himself. It also says that “spongebob is encrypting your files,” which is funny but not entirely accurate as no encryption has taken place whatsoever.

There is still a very large industry for malware and ransomware. Not all projects under development will result in major damage, but it goes to show anyone can take existing content and turn it into something nefarious with relative ease. We can only hope SpongeBob Ransomware 2.0 will not make the rounds anytime soon, since it could upset quite a few fans of the show.

Key Takeaways from SEC DAO Report

EU members are looking at a proposal which will enable them to stop account holders from withdrawing their own money, preventing bank runs.

Inadequate infrastructure is a major problem faced by Africa and other developing parts of the world.

We have seen a fair share of strange statements in the cryptocurrency world lately. A lot of people are upset about high Bitcoin fees, which is understandable. However, Roger Ver has seemingly gone off the deep end as far as these discussions are concerned. He feels SegWit transaction on the Bitcoin network are “too cheap” … Continue reading Roger Ver Claims SegWit Transactions are “Unfairly Cheap” due to Alleged Core Subsidies

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There are two cardinal rules bitcoin holders should follow to prepare for the bitcoin hard fork. These rules will help users protect their bitcoin and gain access to bitcoin cash after the fork resolves.

Also read: Fork Watch: Korean Bitcoin Exchanges Divided on ‘Bitcoin Cash’

Bitcoin.com has had a lot of people inquire about how to protect their bitcoin and gain access to bitcoin cash on Breadwallet and blockchain.info specifically, which will be addressed at the end of this article.

The hard fork is happening August 1. Bitcoin cash is being created by the fork. It is a new and different token (coin) than “bitcoin legacy” (the current Bitcoin network).

Do not panic, though. Your coins will not just evaporate into thin air. You will have options on how to handle the consequences of the fork no matter what happens. Here are the two cardinal rules.

Rule 1: Protect Your Private Keys

The most important thing to remember: do not keep your coins on a custodial wallet. This will ensure you will have access to your bitcoin after the fork. Make sure you store your coins in a wallet where you KEEP THE PRIVATE KEYS.

Keys are not the same thing as “password”. You can use a password to login to a service (like an online wallet). “Keys” refer to the actual code used to control your funds (your coins) on the Bitcoin blockchain. As long as you have the key, you can always use that key (in almost any Bitcoin-compatible wallet) to access your funds.

To keep your private key private all you need to do is to use a wallet where you create a seed code or generate a password that protects your private keys. Many wallet applications provide information on whether they are custodial or not.

As a rule of thumb, any trading platform, exchange, or web wallet generally manages user’s keys themselves. They do not give you access to the keys, so in reality they control all the coins on their site — much like a bank would control your assets if they are kept inside.

For clarification, a word code or seed code basically acts a replacement for your private keys. In the event that you lose your private keys, the seed code is used to regenerate that key and gain access to your coins.

When the fork occurs, possessing the private keys means you will be able to access also bitcoin cash. The amount you can control will be the equivalent amount of bitcoin you had the keys to at the time of the fork. If you do not have your keys, however, the custodian or web wallet controller will make that decision for you (whether to credit you with the new bitcoin cash coins or not).

Waiting Period: Obtaining Bitcoin Cash After the Fork

Furthermore, after the fork completes, each wallet provider may provide (or have already provided) information on how to manage bitcoin cash. Usually, this will just involve each service/app creating a tool or application that allows you to access your newly minted bitcoin cash. The user can simply wait until the service in question provides that tool. Read the news blog of the company behind the wallet you are using to check their latest statements. If there is no statement on Bitcoin Cash and they don’t reply to questions on the matter, it might be advisable to move coins to a wallet that explicitly supports bitcoin cash.

If the company does not, it is still possible to extract your private keys (in most cases, not all) and use them to claim bitcoin cash in another wallet, although this process requires some technical knowledge of command line or code. It may be best for most users just to keep their keys in wallets that have already announced support for bitcoin cash. Coinbase.com, for instance, currently does not support bitcoin cash.

Another option, although a bit riskier, is to place your coins at an exchange that’ll support bitcoin cash (they’ll credit your account with the same amount of bitcoin cash). Here is a list.

Rule 2: Do not Transfer Bitcoin During or Immediately Following the Fork

The second rule: Users should not to do any bitcoin transactions — send or receive coins — during or directly following the fork. All users should wait until two or three days after the fork before sending funds (maybe longer depending on network stability). This is important because the network may be unstable and vulnerable to attacks during this period. However, any vulnerabilities cannot be easily exploited if users are not sending funds around.

If you follow the two rules cited above, you should be well protected both during and after the fork, as well as be able to access bitcoin cash. Stay tuned to Bitcoin.com for more information regarding the fork as the situation develops.

Obtaining Bitcoin Cash on Breadwallet and Blockchain.info

Breadwallet

Some users are confused about how they will obtain bitcoin cash on Breadwallet. This should be a simple process. After the fork, Breadwallet will develop a new wallet application specifically for bitcoin cash. A user will then just use their seed code from their original wallet with the new one to gain access to their bitcoin cash.

It is still unclear how long it will take Breadwallet to develop the application. However, after the dust settles, users should still be able to send and receive their “legacy” bitcoin. Their bitcoin cash amount — at the time of the fork — should remain safe until Breadwallet’s application goes live.

Bitcoin.com spoke with Aaron Lasher, the CMO of Breadwallet. He clarified:

Subsequent to a persistent fork, bitcoin experts and coders can access their private keys using the BIP39 protocol and their 12-word recovery phrase. Retail customers will need to wait a little longer for us to release a separate version of the app that segregates the coins in a user friendly manner.

Blockchain.info

In the case of blockchain.info, users must first make certain they generate their private keys on the security settings page (a 12-word seed phrase). This will guarantee the user retains access to their funds after the fork. Blockchain.info has not provided details on how they plan on supporting bitcoin cash. Founder, Peter Smith, tweeted users can choose their fork at Blockchain, but did not provide more details.

Transactions clearing in a timely way at @blockchain and with your own private keys, you can choose which fork to be on. #BeYourOwnBank

— Peter Smith (@OneMorePeter) July 29, 2017

Blockchain.info could still opt not to develop a tool or application to give users access to their bitcoin cash funds. If this occurred, users would have to extract the private keys to later gain access to their coins via another wallet that supports bitcoin cash. Currently, it would be recommended that users keep their bitcoin with wallet providers that have detailed how they are going to provide access to bitcoin cash. This will make obtaining it easier after the fork resolves, without having extra technical/coding skills.

Not Keeping Bitcoin Cash

All users must also bear in mind they are not in any way obligated to access or try to keep any bitcoin cash. If you just want to access your bitcoin, all that is recommended to do is wait for the fork to finish and the dust to settle. When the fork resolves, you should be able to continue using or saving your bitcoin like nothing happened.

If you have any further questions about this process, please post them below! We will do our best to answer questions and help users secure their bitcoin and bitcoin cash. 

Images courtesy of Shutterstock

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The post Hard Forking For Dummies: 2 Simple Rules to Access Your Bitcoin Cash appeared first on Bitcoin News.

The most common question we’ve been getting lately is “How are you different from Musiconomi, Voise, Opus and other blockchain-based music startups?” (If you’re not familiar with any of the above, go ahead and read this sweet review from Crowd Conscious.) It’s quite simple. The only thing we have in common is that we all try … Continue reading How Is Viberate Different from Other Music Startups?

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A deep dive into claims that it’s safe to remove bitcoin’s block size limit and instead rely on existing “simplified payment verification” methods.

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