Day: September 9, 2018

Tether playing essential role in allowing Chinese traders to get around crypto trading ban, says local media

A story circulated through the mainstream crypto media that Goldman Sachs was abandoning its crypto trading desk ended up being a fake news. Not only is Goldman Sachs not abandoning its crypto trading desk, according to its Chief Financial Officer (CFO) Martin Chavez, Goldman Sachs is looking to expand its operation by launching a Bitcoin derivative.

Martin Chavez says “I never thought I would hear myself use this term but I really have to describe that news as fake news”. The fake news made the rounds on 5 September 2018, the same day Bitcoin crashed from USD 7,400 to USD 6,400. Many people at the time speculated that the Goldman Sachs news helped drive this crash. Yet, the market hasn’t gone up since this fake news was reversed, suggesting it might just be a coincidental crash event.

Martin Chavez indicates that clients want a Bitcoin derivative, specifically saying “The next stage of the exploration is what we call non-deliverable forwards, these are over the counter derivatives, they’re settled in U.S. dollars and the reference price is the bitcoin-U.S. dollar price established by a set of exchanges”. Goldman Sachs is already settling Bitcoin futures contracts from the Chicago Mercantile Exchange (CME) and Chicago Board Options Exchange (CBOE) since May 2018. This new derivatives product Martin Chavez is talking about is like an in-house version of cash-settled Bitcoin futures.

It would be much better for Bitcoin, and much more groundbreaking, if the product Goldman Sachs plans to launch uses physical Bitcoins. However, Martin Chavez says “Physical bitcoin is something tremendously interesting, and tremendously challenging. From the perspective of custody, we don’t yet see an institutional-grade custodial solution for bitcoin, we’re interested in having that exist and it’s a long road”.

His argument isn’t entirely true, since Xapo, BitGo, and Coinbase offer institutional grade crypto custodianship that would be effective and sufficient for Goldman Sachs’ operations. However, it is unfortunate that Goldman Sachs is choosing to go with cash-settled derivatives – paper bitcoins, instead of actual bitcoins. Paper bitcoins are actually bad for the Bitcoin market, since they divert investment away from the spot market, causing Bitcoin’s price to be lower in the long-term than it would be if paper bitcoins didn’t exist. Unfortunately, paper bitcoins are proliferating on the Bitcoin futures markets in Chicago, on derivatives exchanges like BitMEX, and now Goldman Sachs.

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In this latest edition of our periodic deep web series, we bring news of Tor 8 – the most feature-rich onion browser yet. We also take a first look at a clearnet web browser that trawls the darknet, and cover the fallout from the Alphabay shutdown, whose repercussions rumble on to this day.

Also read: Russian Industry Association Launching Crypto Certification Program

Tor 8 Looks Great

The Tor Project has released its latest and greatest browser yet. Tor 8 is a slick looking beast compared to the Tor browsers of yore, partially thanks to its incorporation of Firefox Quantum, which allows for better page rendering and other subtle tweaks. With Tor 8, there’s a new welcome screen to guide first-time users through the process of connecting to the deep web, and there are additional security protections built in. A Tor Circuit button can now be used to switch servers at random, further obfuscating users’ connection route.

Tor 8 comes with HTTPS Everywhere and Noscript, and it is recommended that users enable these add-ons, as they’re critical in maximizing anonymity while browsing the web. While the Tor browser is best known as a tool for navigating the dark web, it can also be deployed as a privacy-friendly clearnet browser which minimizes cookies and other web trackers. Finally, the new improved Tor makes it easier to circumvent firewalls in countries where internet censorship is rife. Its development team explains:

For users where Tor is blocked, we have previously offered a handful of bridges in the browser to bypass censorship. But to receive additional bridges, you had to send an email or visit a website, which posed a set of problems. To simplify how you request bridges, we now have a new bridge configuration flow when you when you launch Tor. Now all you have to do is solve a captcha in Tor Launcher, and you’ll get a bridge IP. We hope this simplification will allow more people to bypass censorship and browse the internet freely and privately.

Deep Web Gets a Clearnet Search Engine

Searching the deep web has traditionally been harder than with its clearnet counterpart. The absence of a darknet Google is arguably part of its appeal, making onion sites accessible only to those who know what they’re looking for. It was this barrier to entry that ensured sites like Silk Road were accessible solely to technically adept users in bitcoin’s early days. The deep web has opened up significantly since then, giving up its secrets, and in the same week that Tor released its most user-friendly browser yet, it’s perhaps fitting that a clearnet search engine for the deep web should launch. Onionlandsearchengine.com is a simple but effective tool for generating deep web search results without needing to first connect to the deep web.

US Government Authorized to Seize Alphabay Suspect’s Assets

Long after deep web marketplaces have been shut down, the fallout continues to make its mark in US courtrooms. Silk Road, Hansa, and Alphabay’s legal wranglings periodically make the news, despite the years elapsed since the sites were first seized. As evidence of this, consider the ruling by a recent US magistrate judge granting the federal government permission to seize and sell millions of dollars worth of assets associated with Alexandre Cazes. The reputed Alphabay ringleader had $8 million of assets on his driveway alone at the time of this arrest in a string of high performance sports cars. Including cryptocurrencies, his total net worth was eventually calculated at $23 million.

Among the showier items in Cazes’ collection was a Lamborghini Aventador LP700-4 worth almost $1 million with a license plate that read “Tor”. The late Alphabay boss certainly wasn’t subtle, but for all his sins, it is hard not to feel sorry for the 25-year-old who wound up dead in a Bangkok cell from suicide, another needless victim of the war on drugs.

Have you tried the latest Tor browser and if so what are your thoughts? Let us know in the comments section below.

Images courtesy of Shutterstock, Tor Project, and Twitter.

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The post Deep Web Roundup: New Search Engine + Tor Browser, Same Old War on Drugs appeared first on Bitcoin News.

At press time, the father of crypto is trading for just over $6,300. This is about $200 higher than where it stood 24 hours ago. Previously, the currency was trading at the $6,100 mark – a drop of over $1,000 from where it was at the beginning of the week.

Is bitcoin trying to pull itself out of the gutter again? Recently, the coin fell after reacting heavily to what’s turned out to be a false report – “fake news,” as the CFO of Goldman Sachs describes. It was originally reported this week that the trading desk the Wall Street giant has been touting for the past several months was no longer in the works due to regulatory uncertainty. It later came out that these claims were false, though by that time, the cryptocurrency had already tanked.

The company’s Marty Chavez explained:

“I never thought I would hear myself use this term, but I really have to describe that news as ‘fake news.’ When we talked about exploring digital assets, it was going to be exploration that would be evolving over time. Maybe someone who was thinking about our activities here got very excited that we would be making markets as principals in physical bitcoin, and as they got into it, they realized that is part of the evolution, but it’s not here yet. The next stage of the exploration is what we call non-deliverable forwards. These are over-the-counter derivatives. They’re settled in U.S. dollars and the reference price is the bitcoin-U.S. dollar price established by a set of exchanges.”

Many analysts are convinced this news helped to bring bitcoin down to the low $6,000 mark again. One analyst – who works in crypto sports betting and wishes to remain anonymous – recently stated:

“I feel the Goldman Sachs news about them rolling back plans on their crypto trading desk definitely helped trigger the bitcoin drop. We were facing some tough resistance at around $7,400 as well, but it’s not the biggest secret in the world that a massive amount of BTC shorts was added on Bitfinex days before this drop, 10,000 in shorts, I believe – follow the money, as they say.”

On the other hand, e-Toro analysts Mati Greenspan is back in the headlines, commenting that bitcoin is still in a very strong position compared to where it was during this time last year, and he’s confident the currency will find a way out of the doldrums:

“Volatility in the crypto market has picked up over the last few days but is still pretty normal for this market. As far as bitcoin’s price is concerned, the price has been in a rather stable range between $5,000 and $8,000 for the last few months and this hasn’t changed.”

Bitcoin Charts by TradingView

The post Bitcoin Price Watch: Currency Up by $200, Analysts Split Down the Middle appeared first on NullTX.

Iceland’s Financial Supervisory Authority (FME) has announced the first registration of a cryptocurrency exchange in the country, allowing users to trade Bitcoin.

The exchange Skiptimynt, will feature two trading pairs, the Icelandic Krona (ISK)/Aurora Coin(AUR) and Bitcoin (BTC)/ISK. Aurora coin is Iceland’s alternative to Bitcoin created in 2014.

In reality, Skiptimynt isn’t the country’s first exchange as that distinction rests with ISX launched in 2016. However, that exchange is largely inactive and doesn’t offer a Bitcoin trading pair, limited to the ISK/AUR pairing.

When Auroracoin was launched it caught the eye of the country including politicians, the cryptocurrency community and the media. Although, very few Icelandic shops and services accepted payments in AUR and since then it has been largely ignored.

After its failed attempts to  “break the shackles of the fiat currency financial system in Iceland”, the country has primarily become a center for cryptocurrency mining. This is largely due to its combination of abundant renewable energy sources and cold climate – both suited for mining operations as they result in low electricity tariffs and cooling costs. Lower costs generate higher profits for cryptocurrency miners, which has created a situation in Iceland where electricity consumption for mining has overtaken household use.

Prominent politicians in Iceland have suggested that the country’s economy could be at risk given a cryptocurrency market crash. Government finance minister Bjarni Benediktsson said that the crypto threat “cannot be excluded as a risk factor” to an economy still recovering from the global financial crisis.

Styrmir Hafliðason, security and quality manager at Skiptimynt data center, is responsible for dealing with the weekly flood of mining applications. He disagrees, suggesting, for example, a crackdown on crypto by regulators wouldn’t impact the country, as crypto assets are simply held as zeros and ones in private centers, and therefore aren’t part of Iceland’s economy.

A recent report by KPMG claims that about 90 percent of the power consumption of Iceland’s data centers last year was dedicated to crypto mining.

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This week in the Hodler’s Digest, Goldman Sachs turns up its nose at a crypto trading desk, while Alibaba and IBM battle for most blockchain patents

There is no chance that the crypto industry will see another “1,000-times growth” again, according to Ethereum co-founder Vitalik Buterin

The Ethereum price is looking anything but healthy at this stage. A lot of value has been lost in the past seven and a half months. In fact, it seems there is no improvement in sight whatsoever. One always has to put this Ethereum price drop into its proper perspective. The ICO craze may be one of the main reasons why this decline is happening right now.

Ethereum Price Decline Continues

Looking at the chart of just this past week, the Ethereum price has lost another 30.8% in value. That is a very steep correction, especially when considering no other top cryptocurrency comes even close to that figure. The next con on this list in Bitcoin Cash, which lost 22.7%. Even so, one would expect much better things from Ethereum given all of its technological appeal.

Finding an exact explanation for this market crash is not necessarily straightforward. Similar to other altcoins, Ethereum is dragged down by Bitcoin’s sudden bearish sentiment. That is the natural order of things in the cryptocurrency world, and it seems no real changes will occur in this regard for the foreseeable future. However, one has to look beyond the obvious to put this puzzle together.

One contributing factor this massive Ether sell-off is the ICO industry. More specifically, virtually all initial coin offerings over the past 18 months raised Ether to meet their funding goals. As has become apparent through several projects, those holdings are liquidated whenever the time arises. As Ethereum is now bleeding value left, right, and center, that sell-off is only accelerated.

As a result, the Ethereum price is breaking numerous key support levels in very quick succession. Many people assumed $300, $250, and $200 would hold with relative ease, but the reality looks very different. A new drop seems imminent, although it is unclear how low the Ethereum price will go. Some speculators expect a bottom of sub $150, albeit that may be wishful thinking.

#ETH

How many supports will Ethereum break in 1 week?

Remember, plenty of ICO's took payments in Ethereum last year.

Those $500 million accounts don't look as good as they once did. They may be inclined to cut their losses soon if they haven't already. pic.twitter.com/7EHfLfFDNS

— NebraskanGooner (@nebraskangooner) September 8, 2018

There is one interesting development which can yield vast improvements for some of the top cryptocurrencies. Coinbase is apparently increasing its daily trading limits, which would introduce higher amounts of cryptocurrency users can buy. It is expected most users will have their limits raised to $25,000 per day, which can improve overall market liquidity. How that will pan out for the Ethereum price, is anybody’s guess.

For the rest, thins appear to be just fine for Ethereum. Its trading volume holds strong, the market cap seems to remain above $20bn – for now – and there is still a lot of genuine interest in this currency. Weathering this storm is crucial, but the same can be said for most other cryptocurrencies on the market. Even so, the Ethereum price will remain subject to a lot of speculation.

The post Ethereum Price: Battle for $200 is on as Reversal Seems Imminent appeared first on NullTX.

Popular stock and crypto trading app Robinhood is planning on going public on the stock exchange with an initial public offering (IPO). Robinhood has been offering zero fee crypto trading since its crypto services launch, causing it to amass users quickly, and now it has over 5 million crypto traders using the platform. If Robinhood were to succeed at getting publicly listed, it would be the first crypto related exchange in the world to have a publicly tradeable stock, a major milestone.

The caveat with Robinhood is it doesn’t offer spot crypto trading. Users can’t withdraw any crypto to their own wallets from Robinhood. Robinhood seems to suggest that the crypto assets in Robinhood accounts are real, but there is no explicit guarantee that Robinhood actually has crypto reserves for all of their crypto balances, they might be using a mix of cash and crypto to back crypto balances. That’s why it is prudent to say this is the first crypto related exchange to get a public stock if successful since Robinhood cannot be considered an actual crypto exchange at this time. That being said, Robinhood’s support page says they want to add crypto withdraws in the future, which would make them a real spot crypto exchange. There is no sign of this happening yet though.

One very important point about this is if Robinhood isn’t backing all of their balances with actual crypto, then they are generating paper crypto. Paper crypto is extremely bad for crypto prices since it takes demand away from spot crypto markets, and therefore crypto prices end up being lower long-term as demand is being diverted into paper crypto which does not impact spot price.

Robinhood has conducted some extremely successful funding rounds leading up to this IPO. In April 2017 Robinhood raised USD 110 million in a series C funding round, giving the company a valuation of USD 1.3 billion. In February 2018 Robinhood conducted a series D funding round and raised USD 363 million, further raising the valuation to USD 5.6 billion. There will likely be at least one more funding round before the IPO, which will force Robinhood’s valuation even higher.

Robinhood has been undergoing constant audits from the United States Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) in preparation for the IPO. Additionally, Robinhood is seeking a Chief Financial Officer (CFO).

If Robinhood’s IPO is successful, and it appears it will be, the billions of USD generated by the IPO will put Robinhood in a position to become a global stock and crypto powerhouse. Robinhood might be considered a small time crypto exchange now, and perhaps not even a real crypto exchange, but that could drastically change after the IPO.

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Here at NewsBTC we believe that education and knowledge is fundamental to the wider adoption of cryptocurrencies and growth of the blockchain industry. We will be expanding our education section by delving deeper into some of the machinations and technology behind the blocks. Our weekly articles aim to provide a greater understanding of how things work in the crypto ecosystem.

Early Origins – A Brief Pre-Bitcoin History

To kick things off we will take a look at the history of cryptocurrency and go back to its very beginnings. As governments and banks became more powerful a libertarian cypherpunk movement evolved to advocate the use of technology to protect privacy. By using cryptography they defined it as the power to selectively reveal oneself.

According to A Cypherpunk’s Manifesto written by mathematician and computer programmer Eric Hughes in 1993;

“Privacy is necessary for an open society in the electronic age. Privacy is not secrecy. A private matter is something one doesn’t want the whole world to know, but a secret matter is something one doesn’t want anybody to know. Privacy is the power to selectively reveal oneself to the world.”

Bitcoin was not envisaged for another fifteen years after this was written but there were a few early attempts at an anonymous digital transaction system. One of the first one came from American computer scientist and cryptographer, David Chaum. In 1990 he founded DigiCash, a cryptographic electronic payments system which employed ‘blind signatures’ to allow users to digitally sign off on transactions without revealing their identity. The downfall of the system was centralization as it was hosted by Chaum’s own company which was responsible for validating each signature. Eventually this led to bankruptcy in 1998.

Hashcash was proposed in 1997 by British cryptographer Adam Back. It was originally designed to prevent email spam as a cryptographic puzzle, or proof-of-work, was required to send out an email. Recipients could then verify authenticity by checking the Hashcash stamp in the header.

B-money came in 1998 from computer engineer Wei Dai as a precursor to Bitcoin. The anonymous, distributed electronic cash system laid out some core concepts that would later be included in Satoshi Nakamoto’s whitepaper. Core concepts included a proof-of-work function used as a means of creating money, everyone maintaining a copy of the database showing who owns what, and work was verified by the community who all worked to update a collective ledger. Just like modern cryptocurrencies, workers were rewarded funds for their effort in expending computational resources.

The concepts from B-money would later influence the development and design philosophy of Bitcoin. Dai Wei along with Adam Back were the first two people contacted by Satoshi Nakamoto while he was developing Bitcoin in 2008.

Next Week: Nakamoto’s Vision

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