Day: May 12, 2018

Sundays are usually contrarian days in the world of cryptocurrencies. During this time of the week, there is often price momentum which seemingly contradicts everything else for the past week. Today is no different, as all markets are rebounding after a few difficult days. This is a positive development for enthusiasts, although maintaining this momentum will not be easy.

The Ethereum Price Rebounds Strongly

It is evident this week has seen its ups and downs as far as all cryptocurrencies are concerned. All markets have lost significant value this week, but it seems a lot of losses are being recovered in quick succession. For the Ethereum price, the dip was quite steep, as the value went from $800 to $644 in very quick succession. This is mainly due to speculation in South Korea regarding the Upbit exchange.

Over the past 24 hours, however, things have certainly improved for the Ethereum price. With a 5.25% gain, there is some temporary reprieve as of right now. Although the Ethereum price still hasn’t recovered to $700, it seems that might happen at some point later today. The Sunday cryptocurrency momentum is always a bit odd, as it contradicts what most people would come to expect at this point in time.

This Ethereum price rise is also facilitated by strong gains in the ETH/BTC ratio. More specifically, Ethereum has gained 3.68% over Bitcoin in this regard. While not necessarily spectacular, it is still a pretty interesting trend to keep an eye on. With Bitcoin’s value now going up as well, the cryptocurrency industry as a whole might show some signs of recovery for this weekend. It is still too early to say for sure how things will play out in this regard.

With $2.288bn in 24-hour trading volume, there is no shortage of people looking to buy and sell Ether. That is a positive sign, a sit almost appeared as if the overall cryptocurrency trading volume would dip below $20bn again. So far, that has not happened yet, but it is evident the overall sentiment is still rather bearish at this time.

The way things look right now, OKEx remains the biggest exchange for Ethereum trading volume. Bitfinex is in second place, followed by Huobi and Binance’s USDT and BTC pairs. Just one fiat currency pair in the five can spell some trouble for the Ethereum price later today, but so far, it isn’t causing any major problems just yet. If this momentum remains in place for a few more hours, it is evident the Ethereum price may hit $700 this evening.

While this temporary bounce is quite positive for all cryptocurrencies, it is still not an indication the markets have officially recovered. The previous big dip lasted almost four months, yet this setback seems to be less of a problem. Even so, anything can happen in the world of cryptocurrency, and it is very well possible the Ethereum price recovery won’t be as spectacular as expected. Today will be a very interesting day, that much seems rather evident.

China’s government is well known as a crypto hater, and its banishments and pronouncements are the stuff of wild market swings. That doesn’t mean, however, they’re not keeping close eye on decentralized currencies. In fact, according to recent press releases, Chinese authorities are set to publish regular monthly analysis of over two dozen crypto assets, its Global Public Chain Assessment Index.

Also read: Bitcoin’s Anonymous $55 Million Pineapple Fund Gives Final Donation

China Set to Provide Monthly Cryptocurrency Report

“This independent analysis of cryptocurrencies and global public blockchain technology demonstrates the confidence of the Chinese Government in the technology, and will act as a guide for government, enterprise and research institute,” a government press release read this week.

Beijing was indeed home to provocative announcements by the government of China such as the above. At a conference, its respective technology ministries explained their monitoring, by way of analysis, nearly thirty cryptocurrencies. Among them, “the first batch of assessment objects were identified: Bitcoin, Ethereum, Ripoco [Ripple], Litecoin, Bitcoin Cash, Cardano, Starcoin, NEO, Ioota, Monroe Currency, Dash, New Currency, Ethereum Classic, Quantum Chain, Nano, Application Chain, Big Zero Coin, Verge, Stratis, Cloud Storage, Stimco, Bit Stock, Bitcoin, Coin, Decred, Super Cash hcash, Komodo, ARK,” various bodies detailed.

Standards for inclusion, according to a Google Translate of the government press release, are, “First, it has its own independent main chain; Second, the public chain node can be freely created; Third, it has an open block browser, block information can be consulted; Fourth, code open source; The fifth is to have a project home page, the project team can contact.”

Blockchain, Not Currency

The government expects shortly to have some kind of ranking system published. The Global Public Chain Assessment Index, as it is referred to, appears to be a way to “evaluate the technological capability, the usefulness of the application and the innovativeness of the project,” government minders insisted, and to determine “development level of the projects to profoundly understand the trend of blockchain technology innovation.”

The conference press releases are full of effusive praise for ‘blockchain’ technology, a corporate staple among buzzwords all over the world. Cryptocurrency trading, of course, is not allowed in the world’s most populous country, and that hasn’t changed. And it’s probably why the currency aspect of crypto was not emphasized, but instead its variations on the distributed ledger technology theme.  

“The first phase of the global public-owned chain technology evaluation index,” the government noted, “will be released in the near future. The official website of the China Electronic Information Industry Development Institute will be the only designated release platform for the evaluation index.”

Is the Chinese government warming to crypto? Let us know in the comments section below.

Images courtesy of Shutterstock.

Need to calculate your bitcoin holdings? Check our tools section.

The post China Plays Jekyll & Hyde, After Ban It Will Publish Monthly Crypto Report appeared first on Bitcoin News.

Key Points

• Bitcoin price declined sharply after it failed to move above the $9,500 resistance against the US Dollar.
• There is a significant bearish trend line forming with resistance at $8,900 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).
• The pair may rise in the short term, but it is likely to face resistances near $8,900 and $9,000.

Bitcoin price is facing tough barriers around $8,900-$9,000 against the US Dollar. BTC/USD must stay above $8,200 and $8,000 to avoid any further losses in the near term.

Bitcoin Price Support

This past week, there was a sharp bearish reaction from the $9,500 pivot level in bitcoin price against the US Dollar. The price declined sharply and moved below the $9,000 and $8,500 support levels. The decline was such that the price traded towards the $8,200 level. It also broke a connecting bullish trend line at $9,000. A low was formed at $8,226 before buyers appeared. Later, the price started consolidating losses above $8,200 and is currently stable.

It tested the 23.6% Fib retracement level of the last decline from the $9,479 high to $8,226 low. It seems like the price is finding it hard to move above the $8,500 level, which is also a pivot level. Above the $8,500 level, the 50% Fib retracement level of the last decline from the $9,479 high to $8,226 low is at $8,850. There is also a significant bearish trend line forming with resistance at $8,900 on the 4-hours chart of the BTC/USD pair. Therefore, the price is likely to face sellers near the $8,500 and $8,900 levels. Once there is a proper close above $8,900 and $9,000, there could be more gains towards $9,500.

Looking at the chart, the current price action is slightly bearish below $8,900. On the downside, the $8,200 level is a decent support, followed by $8,000. If bitcoin fails to hold $8,000, it could decline below $7,500.

Looking at the technical indicators:

4-hours MACD – The MACD for BTC/USD is about to move into the bullish zone.

4-hours RSI (Relative Strength Index) – The RSI is currently well below the 50 level.

Major Support Level – $8,200

Major Resistance Level – $8,900

The post Bitcoin Price Weekly Analysis – Can BTC/USD Hold $8,000? appeared first on NewsBTC.

Key Highlights

• ETH price declined heavily this past week and moved towards the $640 level against the US Dollar.
• There is a crucial bearish trend line forming with resistance at $720 on the 4-hours chart of ETH/USD (data feed via Kraken).
• The pair is slowly recovering and is currently facing many hurdles on the upside near $710-720.

Ethereum price tested major supports versus the US Dollar and Bitcoin. ETH/USD is currently correcting higher and is facing resistances near $710 and 100 hourly SMA.

Ethereum Price Upside Barrier

There was a monster decline from the $825 swing high in ETH price against the US Dollar. The price declined sharply and moved below the $760 and $700 support levels. It even traded below the $650 level and formed a low at $638. Later, it started consolidation is showing positive signs above the $650 level. There was also a break above the 23.6% Fib retracement level of the last decline from the $768 high to $638 low.

On the upside, there is a major resistance seen near $704 and the 100 hourly simple moving average. Moreover, the 50% Fib retracement level of the last decline from the $768 high to $638 low is around the same $703 level. There is also a crucial bearish trend line forming with resistance at $720 on the 4-hours chart of ETH/USD. The pair may continue to trade higher in the near term, but it is likely to face sellers near $704 and $710. A proper break above the $704 resistance and the trend line is needed for more gains.

The above chart indicates that the price is consolidating gains above the $640 level. As long the price above $640-650, there is a chance of ETH breaking the $720 barrier for more gains during the coming days.

4-hours MACD – The MACD is about to move into a bullish zone.

4-hours RSI – The RSI is slowly moving higher towards the 50 level.

Major Support Level – $640

Major Resistance Level – $720

The post Ethereum Price Weekly Analysis – Can ETH/USD Recover Further? appeared first on NewsBTC.

Just recently news.Bitcoin.com reported on traders who exchanged “significant” trade volume using the peer-to-peer platform, Localbitcoins, by receiving warnings to upload their identity before they could proceed trading. Now the Localbitcoins organization has updated its terms of service agreement which comes with a few new guidelines concerning ID verification and data retention.

Also read: Markets Update: Cryptocurrencies Lose Steam During the Weekend

Localbitcoins Updates its ToS, Highlighting ID Verification and the Organization’s Privacy Policy

Localbitcoins the peer-to-peer exchange founded in June 2012 in Helsinki, Finland has been a very popular trading platform for quite some time. For a while, users could trade in a fairly anonymous manner as it wasn’t required for traders to upload their identification. However a few years ago the organization added the ability for users to verify their state ID or license through a system called Jumio Netverify. A user could voluntarily upload their ID, adding more trust to the trading situation if the person is a real individual. Then this year traders who have been trading “significant” amounts of BTC volume reportedly were being asked to upload their ID to proceed to trade further using the platform.

Now the business has updated its terms of service (ToS), and explains much of the changes are due to EU regulation, specifically the General Data Protection Regulation (Regulation 2016/679). Cryptocurrency enthusiasts thought that it was odd that Localbitcoins suddenly announced changing its ToS this month, due to this specific regulation which is supposed to actually limit data harvesting, and allow citizens ownership over their identity rights online. Localbitcoins new ToS highlights a few things users should know about identification requirements.

Some Situations May Prompt ID Verification 

Localbitcoins states the organization still does not enforce ID verification as a mandatory procedure for users but says there could be situations where you are required to submit an ID.    

“We don’t require ID verification for all users, but in some situations, you may be asked to verify your ID with us,” explains the website.

The following situations will prompt the company to ask the user to upload an ID such as trading over certain volume limits and when advertising, or if someone hacks your account, fraud investigations, and account recovery.

“It is our top-most priority to ensure that Localbitcoins is a safe and secure bitcoin marketplace and that no one is able to use our service for money laundering or other unlawful activities,” the web page states.  

Most fraud on Localbitcoins stems from users attempting money laundering. We believe that taking a strict stance in this regard is in the interest of our users and important for our brand as a trustworthy marketplace.

The Quest for Decentralized Exchanges Continues

As far as retaining user data and the organization’s privacy policy, Localbitcoins says they had to rewrite their entire policy. After people began to digest the latest Localbitcoins statements and how the ToS which will be enforced on May 25, many bitcoin enthusiasts again talked about platforms like Shapeshift, and decentralized exchanges like Barterdex, Bisq and others. Again, most cryptocurrency proponents understand the problem with Localbitcoins is the fiat exchange process, which is something you cannot do with Shapeshift.

What do you think about Localbitcoins new ToS? Let us know in the comments below. 

Images via Pixabay, Superbad, and Localbitcoins. 

Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’s Wiki page for an in-depth look at Bitcoin’s innovative technology and interesting history.

The post Localbitcoins Updates ToS: ‘Some Situations May Require ID’ appeared first on Bitcoin News.

Distributed ledger technology-based company IOTA is continuing to expand its business with the release of its highly anticipated ‘Project Q’. The project has been the subject of a great deal of speculation and interest in the cryptocurrency community after the leaders of IOTA began to allude to it in a series of conversations.

According to a team of Indian lawyers, the Supreme Court of India refused request for a temporary injunction against restrictions imposed on banks regarding cryptocurrency by the country’s central bank. The Reserve Bank of India (RBI) issued a circular essentially banning crypto services, which will remain in place at least until a formal hearing.

Also read: Bitcoin’s Anonymous $55 Million Pineapple Fund Gives Final Donation

Indian Supreme Court Denies Grant of Injunction Against RBI

Crypto Kanoon (@cryptokanoon) is a group of lawyers active in the space concerned with regulatory analysis and legal awareness. They’ve been particular watchful of goings on regarding India’s central bank, RBI, and its recent circular demanding banks it serves shut down any business with cryptocurrency companies.

Through a petition challenging the RBI ban, enthusiasts hoped by this week to see some relief at the country’s highest court. An interim measure employed by most courts around the world is to cease a particularly controversial action until such time as a final decision can be made. And it was just such a move crypto advocates were hoping would be followed during the petition’s consideration: allow banks to continue serving cryptocurrency clients as they had prior to the RBI ban.

Yesterday, the Supreme Court instead declined an interim injunction, for now allowing the RBI ban to stay in place. It was a blow to the near dozen representatives from India’s crypto community. It is important to note that such a procedural decision theoretically has no bearing on the eventual outcome of the petition for relief itself. The case will return before the Supreme Court May 17th.

The Reserve Bank of India’s circular from April ordered “with immediate effect, entities regulated by the Reserve Bank shall not deal in VCs [(virtual currencies)] or provide services for facilitating any person or entity in dealing with or settling VCs.” The ban appears to be rather comprehensive in scope, including “maintaining accounts, registering, trading, settling, clearing, giving loans against virtual tokens, accepting them as collateral, opening accounts of exchanges dealing with them and transfer / receipt of money in accounts relating to purchase / sale of VCs.”

Indian Crypto Community Pushes Back

West Bengal’s Dwaipayan Bhowmik was the originator of a petition, asking government to regulate cryptocurrencies such as bitcoin core (BTC). His request was to galvanize the various ministries, from the country’s Securities and Exchange Board (SEBI) to the Reserve Bank itself. Mr. Bhowmik was quoted by regional media as wishing “to prevent financial crimes such as money laundering, flesh trade, etc.”

A quirk of the judicial appeal process in the world’s second most populated country is to allow petitioners, no matter their side advocacy, to appeal together. Two petitioners are diametrically opposed on the issue, in other words, with one wanting an outright ban and the other wanting it formally recognized by the government. For his part, Mr. Bhowmik insisted he falls in neither camp. “I just want it to be regulated,” he said.

There is yet another case, filed by crypto exchange startup Coil Recoil and various exchanges, to be heard in the Delhi High Court May 24th. The two cases are unrelated. As reported in these pages, many felt “the RBI directive is arbitrary and a violation of the Constitution of India, and the court should therefore quash it. The document presented to the count, which news.Bitcoin.com has obtained, explains that due to the RBI Circular the company will not be able to secure banking services that are imperative for the business’ operations rendering it ‘stillborn.’”

Whatever the case, May promises to be a critical month for India’s crypto community.

Do you think India’s Supreme Court will overturn the RBI ban? Let us know in the comments section below.

Images courtesy of Shutterstock.

Need to calculate your bitcoin holdings? Check our tools section.

The post India’s Supreme Court Keeps Ban on Banks’ Crypto Services, For Now appeared first on Bitcoin News.

The Eastman Kodak Co. will conduct a token sale for its long-awaited KODAKCoin beginning May 21. The sale will target accredited investors and aims to raise $50 million for the development of a blockchain platform. The New York-based company has already held a presale in which it raised $10 million from investors.

The KODAKCoin will be the native digital asset for KODAKOne, a blockchain platform that aims to empower photographers by giving them greater control over image rights management. KODAKOne was developed by Wenn Digital, a Venice, California-based company in which Kodak has a minority ownership.

Complying With Regulations

Kodak’s ICO, which had been initially planned for January, was delayed in order for the company to comply with regulatory requirements, the chairman and co-founder of KODAKOne revealed in an interview with Reuters.

We really took a step back and decided that we would ensure that all T’s were crossed and I’s dotted before we embark on a public sale. We wanted to make sure that we got it right.

The KODAKCoin will be offered via the Simple Agreement for Future Tokens (SAFT), an instrument that makes the process legally compliant with the SEC. SAFT is an investment contract that’s offered for tokens that may be commodities in the future. This contract assures investors that such tokens will be delivered once the platform is developed, and that the tokens can then be used. SAFT is based on the premise that the SEC will not classify the tokens as securities at that point. SAFTs are issued to accredited investors, which means that the companies issuing them don’t need to register with the SEC. SAFTs were first issued last August by Protocol Labs, the company behind decentralized file storage platform Filecoin. Others have picked up on them, including popular messaging app Kik and Mark Cuban-backed eSports betting company Unikrn.

Taking Advantage Of The Hype?

While blockchain technology offers a real solution to the challenge of digital rights management which has troubled artists for decades, eyebrows have been raised over Kodak’s decision to shift its focus to the blockchain. This is especially so because of the recent trend of many companies changing either their names or their main activities in order to align themselves with blockchain tech and take advantage of the hype and attention the industry is getting. These companies include Long Island Iced Tea Corp, which changed itself to Long Blockchain Corp and tripled its value overnight; and Bioptix, which changed to Riot Blockchain. This has made the SEC take a particular interest in such companies, and it has even warned such companies that they will come under intense scrutiny.

After announcing the move, Kodak’s stock price began to appreciate almost immediately. According to the New York Times, the stock rose more than 200% to over $13, but it has since corrected and currently stands at just over $5.

While its application of blockchain tech holds much promise, all we can do is wait and watch the progress.

Nouriel ‘Dr. Doom’ Roubini calling cryptocurrency a scam, the mother of all bubbles, and an even bigger bubble than tulip mania (yes, he did) is no longer something new. Roubini has been vocal in his opposition to both Bitcoin, calling it a scam whose intrinsic value is zero; and the blockchain, terming it unnecessary and capable of being replaced by other technologies. He was recently at it again, this time using two platforms on the same day to call out cryptos, ICOs, and blockchains.

‘Centralization Is The Future, Cryptos Have No Place’

Roubini was one of the panelists at a roundtable discussion on the future of cryptos and their role in the financial system which was held on May 10 in New York. The other panelist was Joseph Lubin, the CEO and founder of blockchain technology company ConsenSys, and also one of the founders of Ethereum. The panel came barely a week after Roubini’s crypto onslaught at the Milken Institute in Los Angeles where he called Bitcoin and its idea of decentralization bulls**t.

While he recognized that the financial industry was in dire need of a revolution, he is of the conviction that cryptos are not the drivers of this revolution. In his mind, centralized systems are the way to go, as they enable authorities to reduce risk and protect consumers through the use of technology.

There is a significant need for a revolution in financial services. But it’ll feature artificial intelligence and big data and payment systems like Alipay and Venmo and Square and PayPal. And those are centralized systems.

He further criticized the principle of decentralization upon which the crypto revolution is premised, terming it utter nonsense. While theoretically, cryptos are decentralized, the reality is that some miners and exchanges have a significant say on the direction that the industry takes, he pointed out.

Lubin was quick to counter these arguments and defend the crypto industry.

We’re not trying to move into a radically decentralized world right away. The internet has transformed society but it didn’t happen instantly, and the internet is broken because there’s no identity construct and there’s no money construct. We’re fixing that.

However, Lubin pursued a more civil discourse than the heated exchange which took place last week between Roubini and some prominent crypto personalities including the CEO of Abra, in which the moderator had to jump in constantly to restore order. Lubin concurred with some of the arguments that Roubini presented, all the while reminding the audience that, cryptocurrency being a nascent industry, there were rough edges that needed to be worked out. One of those issues is the susceptibility of the industry to mining centralization, an issue Roubini is always quick to point out.

‘ICO Charlatans Taking us Back To The Stone Age’

Earlier in the day, Roubini had taken to writing to call out ICOs as retrogressive. In his article for Project Syndicate, he had criticized ICOs as scams which should instead be referred to as ICSs – Initial Coin Scams.

That is precisely where the ICO charlatans would effectively take us – not to the futuristic world of “The Jetsons,” but to the modern Stone Age world of “The Flintstones” where all transactions occur through the barter of different tokens or goods. It is time to recognize their utopian rhetoric for what it is: self-serving nonsense meant to separate credulous investors from their hard-earned savings.

He also referred to a survey by Satis Group, an ICO advisory firm, which found that 81% of ICOs are scams “created by con artists, charlatans, and swindlers looking to take your money and run.” According to the survey, only 8% of ICOs end up being traded on an exchange.

Global tech giant IBM, through a partnership with anti-poverty campaign movement Global Citizen, is challenging blockchain developers to create a donation tracking program, reports Fortune.

IBM’s aim for the project is to encourage philanthropy by tracking the path of donations, from where the money originated to what it was spent on, and who finally received the funds. It is not the first of such projects promoting support for underdeveloped nations and struggling communities. The Multinational recently launched a pilot blockchain-based project to support small businesses throughout Africa with a Kenyan logistics company.

The two-month competition called “Challenge Accepted” was inspired by the United Nations’ Envision 2030 initiative, which aims to improve the lives of impoverished and at-risk people. It is s open for all comers starting on May 15 and will offer rewards to participating developers, including tickets to the Global Citizen music festival in New York in September.

Simon Moss, a co-founder of Global Citizen, suggests that the technology has the potential to change the face of humanitarian aid, claiming that blockchain can provide the much-needed transparency to donations provided for humanitarian aid:

“Blockchain can provide clarity on not only who is donating, but how money and supplies flow through organizations that provide aid – such as tracking a gallon of water purchased by an organization to the location where it was delivered,” he wrote.

Blockchain solutions to these types of donations have a clear benefit in the light of numerous recent scandals connected with humanitarian overseas aid. The most recent media focus on allegations of 26 claims of sexual misconduct against Oxfam workers in Haiti is a case in point. Potential donors are often concerned about the final destination of their donation. Also, fake charity approaches occur all year round and often take the form of a response to real disasters or emergencies, such as floods, cyclones, earthquakes, and bushfires.

Along with IBM, both the UN and the World Food Programme have also been proactive using blockchain to record transactions.  IBM project manager Kathryn Harrison commented that IBM is looking to become involved in projects that can make some social impact, involving the company in, “opportunities to use this technology in areas that we can do some pretty substantial social good.”

As for the project, IBM has a fairly open requirement for the “Challenge Accepted” competition: “We’re focused on so many different types of use cases. We look at food safety, we look at microfinance, we look things like the environment and carbon credits and energy savings,” Harrison explained.

There’s been a significant rise in recent years in charities which are now supported by cryptocurrency donations. Some of these have joined a growing establishment of charities accepting Bitcoin donations such as Electronic Frontier Foundation, Multidisciplinary Association for Psychedelic Studies, WikiLeaks, Antiwar.com, Watsi, Water Project, Code to Inspire, Bitgive and Epic Change.

Charities trialing Bitcoin donations are on the rise. More familiar High Street names include such well-known organizations as the Red Cross and Save the Children.

Follow BitcoinNews.com on Twitter at @BitcoinNewsCom

Telegram Alerts from BitcoinNews.com at https://t.me/bconews

The post IBM, Global System set Blockchain Developers Humanitarian Aid Challenge appeared first on BitcoinNews.com.

Dispatch is a platform promising zero transaction fees and a speed of tens of thousands of transactions per second (TPS). Is this platform a theoretical pipedream or worth a look? Find out more in this exclusive Merkle interview with Zane Witherspoon, co-founder and CTO of Dispatch Labs.

The Merkle: Can you tell us briefly about Dispatch Labs and how you got involved?

Zane Witherspoon: Dispatch Labs is a new chain built as a platform for data-driven DApps.

I was organizing the San Francisco Ethereum meetups when I met Matt McGraw and Patrick Wickstrom for the first time. We started talking about an idea of theirs for royalty leakage tracking using blockchain. It was probably the most boring thing you could do with such a new and exciting technology. We kept in touch, and started thinking about music. I’m a musician and Matt and I both have many artist friends, making us very familiar with the problems of artists and distribution costs.

We set out to make a content marketplace built on the blockchain, empowering artists to distribute their own music without middlemen taking a cut [of] their profits and bringing music to consumers for less. When we looked at platforms, we realized no blockchain could handle this quantity of data. That’s when we started working on building an underlying protocol and [it’s] how Dispatch Labs was born. A platform with speeds robust enough to support streaming music also had many other possible uses: AI, IoT, machine learning, streaming video, health records and data transfer, and more.

Both Matt and Patrick saw the bigger picture faster than I did, and as we built the platform, they brought up the idea of a consultancy. Patrick had spent years as a consultant at [PricewaterhouseCoopers] and Matt had helped many startups find major success, and [they] wanted to bring in people we could support as a consultancy and also introduce to our platform. I was so against it at first, but I couldn’t have been more wrong. We ended up forming a governing organization called The Bureau with Constellation Labs, a DAG protocol based on reusable smart contracts.

The Bureau became our innovation hub and governing organization, and our underlying protocols, Dispatch Labs and Constellation became the spokes. The Bureau lets us work with interesting blockchain projects, [supporting] their success as startups. In this structure, the Bureau builds out our connections, Constellation’s DAG works well at data intake, and Dispatch powers data collection and processing.

The Bureau at work inside Dispatch Labs’ San Francisco office

The Merkle: What kinds of partnerships does Dispatch have for getting new users and businesses on its platform? I saw you recently partnered with Utopi, offering a streaming video service.

Witherspoon: While we’re pretty blockchain-agnostic as far as how our Bureau clients develop their projects, many of them are excited to build on Dispatch because of the resources we can provide them and the influence they can have in the development of the protocol.

Nanovision is putting open medical data on the blockchain. This shared data would help to bring faster FDA approval for new prescription drugs. Nanovision also partnered with ARM processors to offer nanochip devices that could store your personal molecular health data on Dispatch.

Bucket seeks to remove coins from the fiat economy. Metal change like coins create a wasteful transportation cycle for companies to cash out at banks, and coin counter machines take a huge cut of consumers’ money for their service. 

The Merkle: You came up with a unique protocol known as Delegated Asynchronous Proof of Stake. How is this different from traditional Proof of Stake, and why was it necessary?

Witherspoon: Traditional blockchains have a hard cap [on the number of] transactions per second. This means the number of transactions is always limited by the number of blocks per second and the number of transactions per block. DAGs are one solution, but they are hindered by the shared quantity of data needed to be stored. DAGs like Nano and IOTA require you to keep a copy of the chain, meaning each individual has their own chain and keeps track of everyone else’s transaction.

Our solution was to apply a hybrid decentralized solution like Delegated Proof of Stake (DPoS), with a smaller quorum of elected validators, to a DAG structure to prevent bottlenecking like we see on traditional blockchains. We DAG-ized DPoS, removing the TPS bottleneck. In Delegated Asynchronous Proof of Stake (DAPoS), the bottleneck becomes the validators themselves. So as validator algorithms and hardware get better, the TPS of the network can scale up with them.

The Merkle: What kind of security auditing are you doing to make sure the Dispatch platform works as intended?

Witherspoon: One of the markers of [the] immaturity of [the] crypto space is there’s virtually no Quality Assurance (QA) on any crypto project. We have a dedicated QA team in our engineering department focused on testing our product. We hired a team of brothers, Dennis and Dimitri Molchanenko, who invented Redwood HQ, one of the most popular QA frameworks used by the US Department of Defense and others. We’re working on our own QA, and trying to encourage the rest of the crypto community to start thinking about it early on in projects as well. We’re also planning on [having] outside code auditing closer to launch.

The Merkle: What’s the most exciting thing about working on new protocols and projects in crypto right now?

Witherspoon: I get to talk about technology and business a lot, but one of the things I’ve learned as a 21 year old CTO [is that] the tech is one thing, but so much of the time it’s the energy of people that’s the magic behind something. I know my career is young, and I constantly feel amazed and blessed to be on the founding team I am, and that Matt and Patrick have taken me under their wing. I love these guys.

“No one knows what the !@#$ is going on.”