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Ultimate glossary of crypto currency terms, acronyms and abbreviations
Mcashchain’s vision is to gather information and store all of them in a decentralized ledger, so as to change payment processes and financial procedures towards being cheaper, more convenient and more room for automation. Mcashchain focuses on security, lightning-speed, efficient and of highest as well as latest technology transactions; so as to create an all-in-one platform within Midas Protocol ecosystem and global finance.
Throughout 11 years of development, Blockchain has evolved and been upgraded step by step, generation by generation. Blockchain 1.0: Allows storing, exchanging properties safely and securely. Bitcoin is the pioneer. Blockchain 2.0: The term “smart contract” was coined. ETH is the pioneer. Blockchain 3.0: Using the strengths of the previous 2 generations, aiming to employ one specific purpose in digital products, the familiar term “Dapp” was coined. Mcash Chain: Owns all of the strong points that were developed in each generation, optimizes the algorithms and adds the technologies to guarantee a definite ability of applying to reality; especially with blockchain’s most powerful application: DeFi. McashChain successfully employed Mainnet, launched Mcashchain even before its introduction to the community and possessed its own coin - MCASH. Obviously, Mcashchain removed the “exists only on paper” part found in most ICO in the market.
Block closing time: 3s Can process upto 100.000 tx
dApps Smart Contract Anonymous-on-Demand Smart staking Others: POS - DAV Consensus Mechanism. Comparing MCASH Exchange fees close to 0. Smart-fee technology results in cheaper transactions, yet improvised to prevent spam transactions that are dangerous to Blockchain. Smart staking Proof-of-Stake (PoH) Consensus Mechanism ranks the chains based on “the amount of MCASH held” and “the number of transactions processed”. Consequently, staking profits (coin digging) are attractive and fair for the stakeholders. Stakeholders - those who possess a large number of coins and Dapps developers are the 2 groups that have brought MCASH success. Anonymous coin exchange technology - Zero M Zero M technology allows users to anonymously exchange coins, without showing the detailed amount and information of the senders and the receivers. Yet, that does not mean Mcashchain is an anonymous blockchain, as Zero M technology allows users to switch between anonymous and normal modes whenever they want. Smartcontract Smart Contract technology has become a vital function in automating transactions in currently popular Blockchains such as ETH, EOS, TRON, Stellar,… MCASH of course is no exception, Mcashchain Smart Contract brings safe, automated and optimized exchange options. The ability to create Token Token economy is the factor that makes ETH successful, with over 98% crypto available in the market using Dapps - decentralized applicationsứng. Mcashchain Smart Contract allows to create tokens and rewards mechanisms, in cases the token chains have several transactions. Mcashbank – Ecosystem and DEFI Blockchain has developed from Satoshi Nakamoto’s vision to a secured properties storing and exchanging platform not under any control. It has also entered a new phase and become the platforms that are very useful in various financial fields worldwide. Hence, the needs to create an ecosystem of applications revolving one blockchain are heightened, so as to prove the feasibility of that blockchain. Decentralized exchange platform All currently powerful and popular blockchain platforms possess their own DEX, such as Etherdelta and IDEX of ETH, Binance DEX, Switcheo of NEO, - just amongst others. Decentralized platforms could prove the ability of blockchain. Mcashchain also develops its own platform Unidex, as a platform supports exchanging digital properties easily.
MCASH DEFI PLATFORM
Mcashchain’s vision is to develop decentralised finance products in the future. The solution is a Mcash blockchain platform and a set of tools to build DeFi products right on Mcashchain. A complete DeFi ecosystem: Lending, saving, payment applications, automated accounting system, etc.
Bitcoin (BTC) is a peer-to-peer cryptocurrency that aims to function as a means of exchange that is independent of any central authority. BTC can be transferred electronically in a secure, verifiable, and immutable way.
Launched in 2009, BTC is the first virtual currency to solve the double-spending issue by timestamping transactions before broadcasting them to all of the nodes in the Bitcoin network. The Bitcoin Protocol offered a solution to the Byzantine Generals’ Problem with ablockchainnetwork structure, a notion first created byStuart Haber and W. Scott Stornetta in 1991.
Bitcoin’s whitepaper was published pseudonymously in 2008 by an individual, or a group, with the pseudonym “Satoshi Nakamoto”, whose underlying identity has still not been verified.
The Bitcoin protocol uses an SHA-256d-based Proof-of-Work (PoW) algorithm to reach network consensus. Its network has a target block time of 10 minutes and a maximum supply of 21 million tokens, with a decaying token emission rate. To prevent fluctuation of the block time, the network’s block difficulty is re-adjusted through an algorithm based on the past 2016 block times.
With a block size limit capped at 1 megabyte, the Bitcoin Protocol has supported both the Lightning Network, a second-layer infrastructure for payment channels, and Segregated Witness, a soft-fork to increase the number of transactions on a block, as solutions to network scalability.
Bitcoin is a peer-to-peer cryptocurrency that aims to function as a means of exchange and is independent of any central authority. Bitcoins are transferred electronically in a secure, verifiable, and immutable way.
Network validators, whom are often referred to as miners, participate in the SHA-256d-based Proof-of-Work consensus mechanism to determine the next global state of the blockchain.
The Bitcoin protocol has a target block time of 10 minutes, and a maximum supply of 21 million tokens. The only way new bitcoins can be produced is when a block producer generates a new valid block.
The protocol has a token emission rate that halves every 210,000 blocks, or approximately every 4 years.
Unlike public blockchain infrastructures supporting the development of decentralized applications (Ethereum), the Bitcoin protocol is primarily used only for payments, and has only very limited support for smart contract-like functionalities (Bitcoin “Script” is mostly used to create certain conditions before bitcoins are used to be spent).
In the Bitcoin network, anyone can join the network and become a bookkeeping service provider i.e., a validator. All validators are allowed in the race to become the block producer for the next block, yet only the first to complete a computationally heavy task will win. This feature is called Proof of Work (PoW). The probability of any single validator to finish the task first is equal to the percentage of the total network computation power, or hash power, the validator has. For instance, a validator with 5% of the total network computation power will have a 5% chance of completing the task first, and therefore becoming the next block producer. Since anyone can join the race, competition is prone to increase. In the early days, Bitcoin mining was mostly done by personal computer CPUs. As of today, Bitcoin validators, or miners, have opted for dedicated and more powerful devices such as machines based on Application-Specific Integrated Circuit (“ASIC”). Proof of Work secures the network as block producers must have spent resources external to the network (i.e., money to pay electricity), and can provide proof to other participants that they did so. With various miners competing for block rewards, it becomes difficult for one single malicious party to gain network majority (defined as more than 51% of the network’s hash power in the Nakamoto consensus mechanism). The ability to rearrange transactions via 51% attacks indicates another feature of the Nakamoto consensus: the finality of transactions is only probabilistic. Once a block is produced, it is then propagated by the block producer to all other validators to check on the validity of all transactions in that block. The block producer will receive rewards in the network’s native currency (i.e., bitcoin) as all validators approve the block and update their ledgers.
The Bitcoin protocol utilizes the Merkle tree data structure in order to organize hashes of numerous individual transactions into each block. This concept is named after Ralph Merkle, who patented it in 1979. With the use of a Merkle tree, though each block might contain thousands of transactions, it will have the ability to combine all of their hashes and condense them into one, allowing efficient and secure verification of this group of transactions. This single hash called is a Merkle root, which is stored in the Block Header of a block. The Block Header also stores other meta information of a block, such as a hash of the previous Block Header, which enables blocks to be associated in a chain-like structure (hence the name “blockchain”). An illustration of block production in the Bitcoin Protocol is demonstrated below. https://preview.redd.it/m6texxicf3151.png?width=1591&format=png&auto=webp&s=f4253304912ed8370948b9c524e08fef28f1c78d
Block time and mining difficulty
Block time is the period required to create the next block in a network. As mentioned above, the node who solves the computationally intensive task will be allowed to produce the next block. Therefore, block time is directly correlated to the amount of time it takes for a node to find a solution to the task. The Bitcoin protocol sets a target block time of 10 minutes, and attempts to achieve this by introducing a variable named mining difficulty. Mining difficulty refers to how difficult it is for the node to solve the computationally intensive task. If the network sets a high difficulty for the task, while miners have low computational power, which is often referred to as “hashrate”, it would statistically take longer for the nodes to get an answer for the task. If the difficulty is low, but miners have rather strong computational power, statistically, some nodes will be able to solve the task quickly. Therefore, the 10 minute target block time is achieved by constantly and automatically adjusting the mining difficulty according to how much computational power there is amongst the nodes. The average block time of the network is evaluated after a certain number of blocks, and if it is greater than the expected block time, the difficulty level will decrease; if it is less than the expected block time, the difficulty level will increase.
What are orphan blocks?
In a PoW blockchain network, if the block time is too low, it would increase the likelihood of nodes producingorphan blocks, for which they would receive no reward. Orphan blocks are produced by nodes who solved the task but did not broadcast their results to the whole network the quickest due to network latency. It takes time for a message to travel through a network, and it is entirely possible for 2 nodes to complete the task and start to broadcast their results to the network at roughly the same time, while one’s messages are received by all other nodes earlier as the node has low latency. Imagine there is a network latency of 1 minute and a target block time of 2 minutes. A node could solve the task in around 1 minute but his message would take 1 minute to reach the rest of the nodes that are still working on the solution. While his message travels through the network, all the work done by all other nodes during that 1 minute, even if these nodes also complete the task, would go to waste. In this case, 50% of the computational power contributed to the network is wasted. The percentage of wasted computational power would proportionally decrease if the mining difficulty were higher, as it would statistically take longer for miners to complete the task. In other words, if the mining difficulty, and therefore targeted block time is low, miners with powerful and often centralized mining facilities would get a higher chance of becoming the block producer, while the participation of weaker miners would become in vain. This introduces possible centralization and weakens the overall security of the network. However, given a limited amount of transactions that can be stored in a block, making the block time too longwould decrease the number of transactions the network can process per second, negatively affecting network scalability.
3. Bitcoin’s additional features
Segregated Witness (SegWit)
Segregated Witness, often abbreviated as SegWit, is a protocol upgrade proposal that went live in August 2017. SegWit separates witness signatures from transaction-related data. Witness signatures in legacy Bitcoin blocks often take more than 50% of the block size. By removing witness signatures from the transaction block, this protocol upgrade effectively increases the number of transactions that can be stored in a single block, enabling the network to handle more transactions per second. As a result, SegWit increases the scalability of Nakamoto consensus-based blockchain networks like Bitcoin and Litecoin. SegWit also makes transactions cheaper. Since transaction fees are derived from how much data is being processed by the block producer, the more transactions that can be stored in a 1MB block, the cheaper individual transactions become. https://preview.redd.it/depya70mf3151.png?width=1601&format=png&auto=webp&s=a6499aa2131fbf347f8ffd812930b2f7d66be48e The legacy Bitcoin block has a block size limit of 1 megabyte, and any change on the block size would require a network hard-fork. On August 1st 2017, the first hard-fork occurred, leading to the creation of Bitcoin Cash (“BCH”), which introduced an 8 megabyte block size limit. Conversely, Segregated Witness was a soft-fork: it never changed the transaction block size limit of the network. Instead, it added an extended block with an upper limit of 3 megabytes, which contains solely witness signatures, to the 1 megabyte block that contains only transaction data. This new block type can be processed even by nodes that have not completed the SegWit protocol upgrade. Furthermore, the separation of witness signatures from transaction data solves the malleability issue with the original Bitcoin protocol. Without Segregated Witness, these signatures could be altered before the block is validated by miners. Indeed, alterations can be done in such a way that if the system does a mathematical check, the signature would still be valid. However, since the values in the signature are changed, the two signatures would create vastly different hash values. For instance, if a witness signature states “6,” it has a mathematical value of 6, and would create a hash value of 12345. However, if the witness signature were changed to “06”, it would maintain a mathematical value of 6 while creating a (faulty) hash value of 67890. Since the mathematical values are the same, the altered signature remains a valid signature. This would create a bookkeeping issue, as transactions in Nakamoto consensus-based blockchain networks are documented with these hash values, or transaction IDs. Effectively, one can alter a transaction ID to a new one, and the new ID can still be valid. This can create many issues, as illustrated in the below example:
Alice sends Bob 1 BTC, and Bob sends Merchant Carol this 1 BTC for some goods.
Bob sends Carols this 1 BTC, while the transaction from Alice to Bob is not yet validated. Carol sees this incoming transaction of 1 BTC to him, and immediately ships goods to B.
At the moment, the transaction from Alice to Bob is still not confirmed by the network, and Bob can change the witness signature, therefore changing this transaction ID from 12345 to 67890.
Now Carol will not receive his 1 BTC, as the network looks for transaction 12345 to ensure that Bob’s wallet balance is valid.
As this particular transaction ID changed from 12345 to 67890, the transaction from Bob to Carol will fail, and Bob will get his goods while still holding his BTC.
With the Segregated Witness upgrade, such instances can not happen again. This is because the witness signatures are moved outside of the transaction block into an extended block, and altering the witness signature won’t affect the transaction ID. Since the transaction malleability issue is fixed, Segregated Witness also enables the proper functioning of second-layer scalability solutions on the Bitcoin protocol, such as the Lightning Network.
Lightning Network is a second-layer micropayment solution for scalability. Specifically, Lightning Network aims to enable near-instant and low-cost payments between merchants and customers that wish to use bitcoins. Lightning Network was conceptualized in a whitepaper by Joseph Poon and Thaddeus Dryja in 2015. Since then, it has been implemented by multiple companies. The most prominent of them include Blockstream, Lightning Labs, and ACINQ. A list of curated resources relevant to Lightning Network can be found here. In the Lightning Network, if a customer wishes to transact with a merchant, both of them need to open a payment channel, which operates off the Bitcoin blockchain (i.e., off-chain vs. on-chain). None of the transaction details from this payment channel are recorded on the blockchain, and only when the channel is closed will the end result of both party’s wallet balances be updated to the blockchain. The blockchain only serves as a settlement layer for Lightning transactions. Since all transactions done via the payment channel are conducted independently of the Nakamoto consensus, both parties involved in transactions do not need to wait for network confirmation on transactions. Instead, transacting parties would pay transaction fees to Bitcoin miners only when they decide to close the channel. https://preview.redd.it/cy56icarf3151.png?width=1601&format=png&auto=webp&s=b239a63c6a87ec6cc1b18ce2cbd0355f8831c3a8 One limitation to the Lightning Network is that it requires a person to be online to receive transactions attributing towards him. Another limitation in user experience could be that one needs to lock up some funds every time he wishes to open a payment channel, and is only able to use that fund within the channel. However, this does not mean he needs to create new channels every time he wishes to transact with a different person on the Lightning Network. If Alice wants to send money to Carol, but they do not have a payment channel open, they can ask Bob, who has payment channels open to both Alice and Carol, to help make that transaction. Alice will be able to send funds to Bob, and Bob to Carol. Hence, the number of “payment hubs” (i.e., Bob in the previous example) correlates with both the convenience and the usability of the Lightning Network for real-world applications.
Schnorr Signature upgrade proposal
Elliptic Curve Digital Signature Algorithm (“ECDSA”) signatures are used to sign transactions on the Bitcoin blockchain. https://preview.redd.it/hjeqe4l7g3151.png?width=1601&format=png&auto=webp&s=8014fb08fe62ac4d91645499bc0c7e1c04c5d7c4 However, many developers now advocate for replacing ECDSA with Schnorr Signature. Once Schnorr Signatures are implemented, multiple parties can collaborate in producing a signature that is valid for the sum of their public keys. This would primarily be beneficial for network scalability. When multiple addresses were to conduct transactions to a single address, each transaction would require their own signature. With Schnorr Signature, all these signatures would be combined into one. As a result, the network would be able to store more transactions in a single block. https://preview.redd.it/axg3wayag3151.png?width=1601&format=png&auto=webp&s=93d958fa6b0e623caa82ca71fe457b4daa88c71e The reduced size in signatures implies a reduced cost on transaction fees. The group of senders can split the transaction fees for that one group signature, instead of paying for one personal signature individually. Schnorr Signature also improves network privacy and token fungibility. A third-party observer will not be able to detect if a user is sending a multi-signature transaction, since the signature will be in the same format as a single-signature transaction.
4. Economics and supply distribution
The Bitcoin protocol utilizes the Nakamoto consensus, and nodes validate blocks via Proof-of-Work mining. The bitcoin token was not pre-mined, and has a maximum supply of 21 million. The initial reward for a block was 50 BTC per block. Block mining rewards halve every 210,000 blocks. Since the average time for block production on the blockchain is 10 minutes, it implies that the block reward halving events will approximately take place every 4 years. As of May 12th 2020, the block mining rewards are 6.25 BTC per block. Transaction fees also represent a minor revenue stream for miners.
Hi Bitcoiners! I’m back with the 30th monthly Bitcoin news recap. For those unfamiliar, each day I pick out the most popularelevant/interesting stories in Bitcoin and save them. At the end of the month I release them in one batch, to give you a quick (but not necessarily the best) overview of what happened in bitcoin over the past month. You can see recaps of the previous months on Bitcoinsnippets.com A recap of Bitcoin in May 2019 Adoption
A NanoCharts driven update for those who want to take control of their Nano and select a rep for their voting weight. For new community members, its worth pointing towards this video to learn about the ORV consensus system that Nano uses: https://youtu.be/LZ8TZFfYDcY Ideally you are taking your coins off Binance (as number 1 rep in terms of weight and you can’t pick a rep there) or removing weight from another larger rep/or a rep controlled by a large entity. Most wallets let you pick a representative, and are even starting to provide additional functionality; surprisingly the NWC mobile apps don’t allow for representative selection right now. Finding a rep can be easy using two main sources:
Nanocharts is a useful view from top reps in terms of weight and below; if you scroll down around the 133K Nano mark you’ll potentially find some reps who only need a but more weight to become a RR. NanoCharts also can help you find a rep, using its ‘need a representative’ function near the top of the page. My Nano Ninja itself is linked from NanoCharts and gives users a great source for further digging into a reps details. Its pioneered the scoring system to help users choose reps, and has even forked the ever popular NanoVault with NinjaVault (which integrates some key functions such as the scoring system). https://arewedecentralizedyet.com also gives us a wider perspective on decentralisation against other cryptos. I think the number of nodes we have without a monetary incentive is a good stat... and the it draws on the key Nakamoto coefficient from https://repnode.org/representatives/nakamoto (how many entities could collude to form a majority on the network - this number is ideally getting bigger). Unfortunately, they don't always pull the latest stats into their main screen. Further help on Nano decentralisation could be found in the #decentralise channel on Nano Discord. https://discordapp.com/invite/JphbBas As a general rule, personally I would consider the following when picking a rep:
Active in Community
Associated with a service you admire
Been around for a long time
Provider is fairly underused - we don’t want everyone on Digital Ocean
Geographic area is under represented - different jurisdictions around the world to spread risk
Confident (as possible) that the rep is not malicious
We currently have 88 Principal Representatives (RR) that help secure the network (that have over around 133K Nano voting weight) and not all of those are online right now. It would be a good milestone to have 100 RRs, and even better to have 100 RRs that are online. Since my last update (roughly) or worth mentioning:
5 less PRs than last time. I suspect the Bitcoin run has forced many to swap Nano for Bitcoin to join the fun. We've seen similar impact on PRs in the past.
https://mynano.ninja/map provided a nice overview of Nano's spread. Hopefully we'll see PRs in South America soon, then some growth in Africa/Asia.
https://mynano.ninja/account/vano A new wallet on the scene that is building up its Ninja score but could be a worth selection. Another 80K needed for this to reach PR status, a 30K improvement over last month.
Anybody from Africa considered running a node? Be good to get on the continent. Or maybe an official node could be spun up/moved there? Did u/Soluchain set up a rep in South Africa?
What if the dev fund voted for a a non official rep with good hardware and knowledge of Nano e.g. repnode, nanocrawler? Would this help increase our Nakamoto coefficient? Long term, I imagine the aim is to have no “Official” reps (which sounds centralised as a title).
With version 19 in beta, and with recent resurgence of the markets, now could be a good time go tell people about Nano and ORV! Comments in general crypto currency groups sometimes sight us not talking about decentralisation even though we are in a good position to make our ecosystem quite decentralised.
Those below Principal Representative (PR) level to make themselves more known in the community so that we can get to 100...
V19 will give us a better opportunity to measure the voting latency for PRs as a proxy for the quality of the underlying nodes (websockets will hopefully help). This could be an important factor in future Ninja scores so that users pick powerful nodes to support the network.
Another codebase that supports hardware wallets (which would be impressive for the ecosystem) or more awareness of the NanoVault derived variants so NanoVault isn’t the only place for Ledger support.
In this short post I want to set out my case for the moral justifiability of 51% attacks against proof of work cryptocurrencies. In the past, a 51% attack was a theoretical construct that most people didn´t seem to think would be practically achievable or lucrative. This has now changed, as hashpower can be rented on sites like Nicehash and Mining Rig Rentals for a few hours at a time. The attack delivers the attacker two prominent opportunities: -You can orphan blocks of ¨legitimate¨ miners. This essentially means that whatever work was produced by legitimate miners during your attack became worthless. Mine a secret chain of two hours worth of blocks, release it and you orphaned 2 hours worth of blocks by your competitors. By the time most of the miners have noticed their blocks were orphaned in an attack, their nodes will have been automatically mining on your own chain for a while and it will be too late for them to do anything about it. The amount of money they lost would be equivalent to the amount you had to spend to produce your chain. Because mining is an industry with tight margins, the economic impact on these miners can be very big. The cost may be sufficient in case of a very long attack, to persuade them to quit their endeavor and get a real job. -The more important opportunity is that you´re able to double spend your coins. This is potentially, incredibly lucrative. How lucrative it is tends to depend primarily on the inflation rate of a cryptocurrency. A low inflation rate means relatively little ¨work¨ is done to maintain the security of the system. A high inflation rate on the other hand, turns the cryptocurrency into a very poor long-term investment. As a consequence, most cryptocurrencies face declining inflation rates, that delay the problem of their ultimately unsustainability into the future. The bank of international settlements explains this issue here. When it comes to the moral justification of a 51% attack, we first have to ask ourselves why proof of work is morally unjustifiable. There are two main reasons for this: -Proof of work has an enormous environmental impact, that ensures future generations will have to deal with the dramatic consequences of climate change. There is no proper justification for this environmental impact, as it delivers no clear benefits over existing payment systems other than the ability to carry out morally unjustifiable actions like blackmail. -Proof of work is fundamentally unsustainable, because of the economic burden it places on participants in cryptocurrency schemes. Cryptocurrencies can´t produce wealth out of thin air. The people who get rich from a cryptocurrency becomes rich, due to the fact that other people step in later. In this sense we´re dealing with a pyramid scheme, but the difference from regular pyramid schemes lies in the fact that huge sums of wealth are not merely redistributed, but destroyed, to sustain the scheme. The cost of the work to sustain the scheme is bigger than you might expect, because the reality is that relatively little money has entered bitcoin. JP Morgan claims that for the crypto assets at large, a fiat amplifier of 117.5 is present, as a purported $2 billion in net inflow pushed Bitcoin’s market capitalization from $15 billion to $250 billion. You have to consider that the Digiconomist estimates that $2.6 billion dollar leaves the Bitcoin scheme on an annual basis, in the form of mining costs to sustain Bitcoin. The vast majority of retail customers who entered this scheme ended up losing money from it. In some cases this lead to suicides. The fact that proof of work is morally unjustifiable doesn´t directly lead to a moral justification for a 51% attack. After all a sane society would use government intervention to eliminate the decentralized ponzi schemes that are cryptocurrencies. There are a few things that need to be considered however: -Governments have so far failed in their responsibility to address the cryptocurrency schemes. Instead you tend to see officials insist that proof of work might suck and most cryptocurrency is a scam, but ¨blockchain technology¨ will somehow change the world for the better. Most libertarians who saw these schemes emerge insisted that it´s stupid to participate in them because the government would eventually ban them and round up the people who participated in them. This didn´t happen because of the logistical difficulty of suppressing these schemes (anyone with an internet connection can set one up) as well as the fact that suppressing them would lend credence to the anti-government anarcho-capitalist ideology on which these schemes are based. Goverments might say ¨these schemes facilitate crime, ruin the environment and redistribute wealth from naive individuals to scammers¨, but anarcho-capitalists would insist that governments have grown so tyrannical that they want to ban you from exchanging numbers on computers. -Because cryptocurrency is fundamentally an online social arrangement, governments have very limited influence over the phenomenon. Binance seeks to become a stateless organization, not subject to the jurisdiction of any particular government. Just as with regular money laundering and tax evasion that hides in small nations that can earn huge sums of money by facilitating these practises, governments are dependent on the actions of individuals to address these practices. Whistleblowers released the panama papers and the tax evasion by German individuals through Swiss bank accounts. Through such individuals, the phenomenon could be properly addressed. In a similar manner, cryptocurrency schemes will need to be addressed through the actions of individuals who recognize the damage these schemes cause to the fabric of society. -The very nature of a 51% attack means that it primarily punishes those who set up and facilitate the cryptocurrency scheme in the first place. The miners who pollute our environment to satiate their own greed are bankrupted by the fact that their blocks are orphaned. The exchange operators are bankrupted due to double-spend attacks against the scams that they facilitate. When this happens, the cryptocurrency in question should lose value, which then destroys the incentive to devote huge sums of electricity to it. Finally, there´s the question of whether 51% attacks are viable as a response to cryptocurrency. There´s the obvious problem you run into, that the biggest and oldest scams are the most difficult to shut down. In addition, cryptocurrencies that fell victim to an attack tend to move towards a checkpoint system. However, there are a few things that need to be considered here: -51% attacks against small cryptocurrencies might not have a huge impact, but their benefit is nonetheless apparent. Most of the new scams don´t require participants to mine, instead the new schemes generally depend on ¨staking¨. If people had not engage in 51% attacks, the environmental impact would have been even bigger now. -51% attacks against currencies that implement checkpointing are not impossible, if the checkpoints are decentrally produced. What happens in that case is a chain split, as long as the hostile chain is released at the right time. This would mean that different exchanges may get stuck on different forks, which would still allow people to double spend their cryptocurrency. -There are other attacks that can be used against proof of work cryptocurrencies. The most important one is the block withholding attack. It´s possible for people who dislike a cryptocurrency to join a pool and to start mining. However, whenever the miner finds a valid solution that would produce a block, he fails to share the solution with the pool. This costs money for the pool operator, but it can be lucrative for the actor if he also operates a competing pool himself. In the best case it leads to miners moving to his pool, which then potentially allows him to execute a 51% attack against the cryptocurrency. -It´s possible to put up a 51% attack bounty, allowing others to do the work for you. This works as following. You make transaction A : 100 bitcoin to exchange X, for a fee of 0.001 BTC. Once this transaction has been included in a block, you immediately broadcast a conflicting transaction with another node: You´ŕe sending those 100 bitcoin to your own wallet, but you´re also including a 50 bitcoin fee for the miners. The miners now have a strong incentive to disregard the valid chain and to start mining a new chain on an older block that can still include your conflicting transaction. Provided that pool operators are rational economic agents, they should grab the opportunity. -Selfish mining in combination with a Sybil attack allows someone to eclipse the rest of the network, while controlling less than 51% of the hashrate. Your malicious nodes will simply refuse to propagante blocks of your competitors, thereby giving you more time to release your own block. Selfish mining will always be possible with 33% of the hashrate and as far as I can tell there are no pathways known currently to make the scheme impossible for people with 25% of the hashrate. This potentially makes a 51% attacks lucrative without having to carry out double-spend attacks against exchanges. Although double spending is a form of theft, it´s not clear to me whether a selfish mining attack would get you into legal trouble or not.
The dreaded 51% attack is a morally justifiable and potentially lucrative solution to the Nakamoto scheme.
A couple of years ago in the early months of the 2017, I published a piece called Abundance Via Cryptocurrencies (https://www.reddit.com/C\_S\_T/comments/69d12a/abundance\_via\_cryptocurrencies/) in which I kind of foresaw the crypto boom that had bitcoin go from $1k to $21k and the alt-coin economy swell up to have more than 60% of the bitcoin market capitalisation. At the time, I spoke of coming out from “the Pit” of conspiracy research and that I was a bit suss on bitcoin’s inception story. At the time I really didn’t see the scaling solution being put forward as being satisfactory and the progress on bitcoin seemed stifled by the politics of the social consensus on an open source protocol so I was looking into alt coins that I thought could perhaps improve upon the shortcomings of bitcoin. In the thread I made someone recommended to have a look at 4chan’s business and finance board. I did end up taking a look at it just as the bull market started to really surge. I found myself in a sea of anonymous posters who threw out all kinds of info and memes about the hundreds, thousands, tens of thousands of different shitcoins and why they’re all going to have lambos on the moon. I got right in to it, I loved the idea of filtering through all the shitposts and finding the nuggest of truth amongst it all and was deeply immersed in it all as the price of bitcoin surged 20x and alt coins surged 5-10 times against bitcoin themselves. This meant there were many people who chucked in a few grand and bought a stash of alt coins that they thought were gonna be the next big thing and some people ended up with “portfolios” 100-1000x times their initial investment. To explain what it’s like to be on an anonymous business and finance board populated with incel neets, nazis, capitalist shit posters, autistic geniuses and whoever the hell else was using the board for shilling their coins during a 100x run up is impossible. It’s hilarious, dark, absurd, exciting and ultimately addictive as fuck. You have this app called blockfolio that you check every couple of minutes to see the little green percentages and the neat graphs of your value in dollars or bitcoin over day, week, month or year. Despite my years in the pit researching conspiracy, and my being suss on bitcoin in general I wasn’t anywhere near as distrustful as I should have been of an anonymous business and finance board and although I do genuinely think there are good people out there who are sharing information with one another in good faith and feel very grateful to the anons that have taken their time to write up quality content to educate people they don’t know, I wasn’t really prepared for the level of organisation and sophistication of the efforts groups would go to to deceive in this space. Over the course of my time in there I watched my portfolio grow to ridiculous numbers relative to what I put in but I could never really bring myself to sell at the top of a pump as I always felt I had done my research on a coin and wanted to hold it for a long time so why would I sell? After some time though I would read about something new or I would find out of dodgy relationships of a coin I had and would want to exit my position and then I would rebalance my portfolio in to a coin I thought was either technologically superior or didn’t have the nefarious connections to people I had come across doing conspiracy research. Because I had been right in to the conspiracy and the decentralisation tropes I guess I always carried a bit of an antiauthoritarian/anarchist bias and despite participating in a ridiculously capitalistic market, was kind of against capitalism and looking to a blockchain protocol to support something along the lines of an open source anarchosyndicalist cryptocommune. I told myself I was investing in the tech and believed in the collective endeavour of the open source project and ultimately had faith some mysterious “they” would develop a protocol that would emancipate us from this debt slavery complex. As I became more and more aware of how to spot artificial discussion on the chans, I began to seek out further some of the radical projects like vtorrent and skycoin and I guess became a bit carried away from being amidst such ridiculous overt shilling as on the boards so that if you look in my post history you can even see me promoting some of these coins to communities I thought might be sympathetic to their use case. I didn’t see it at the time because I always thought I was holding the coins with the best tech and wanted to ride them up as an investor who believed in them, but this kind of promotion is ultimately just part of a mentality that’s pervasive to the cryptocurrency “community” that insists because it is a decentralised project you have to in a way volunteer to inform people about the coin since the more decentralised ones without premines or DAO structures don’t have marketing budgets, or don’t have marketing teams. In the guise of cultivating a community, groups form together on social media platforms like slack, discord, telegram, twitter and ‘vote’ for different proposals, donate funds to various boards/foundations that are set up to give a “roadmap” for the coins path to greatness and organise marketing efforts on places like reddit, the chans, twitter. That’s for the more grass roots ones at least, there are many that were started as a fork of another coin, or a ICO, airdrop or all these different ways of disseminating a new cryptocurrency or raising funding for promising to develop one. Imagine the operations that can be run by a team that raised millions, hundreds of millions or even billions of dollars on their ICOs, especially if they are working in conjunction with a new niche of cryptocurrency media that’s all nepotistic and incestuous. About a year and a half ago I published another piece called “Bitcoin is about to be dethroned” (https://www.reddit.com/C\_S\_T/comments/7ewmuu/bitcoin\_is\_about\_to\_be\_dethroned/) where I felt I had come to realise the scaling debate had been corrupted by a company called Blockstream and they had been paying for social media operations in a fashion not to dissimilar to correct the record or such to control the narrative around the scaling debate and then through deceit and manipulation curated an apparent consensus around their narrative and hijacked the bitcoin name and ticker (BTC). I read the post again just before posting this and decided to refer to it to to add some kind of continuity to my story and hopefully save me writing so much out. Looking back on something you wrote is always a bit cringey especially because I can see that although I had made it a premise post, I was acting pretty confident that I was right and my tongue was acidic because of so much combating of shills on /biz/ but despite the fact I was wrong about the timing I stand by much of what I wrote then and want to expand upon it a bit more now. The fork of the bitcoin protocol in to bitcoin core (BTC) and bitcoin cash (BCH) is the biggest value fork of the many that have occurred. There were a few others that forked off from the core chain that haven’t had any kind of attention put on them, positive or negative and I guess just keep chugging away as their own implementation. The bitcoin cash chain was supposed to be the camp that backed on chain scaling in the debate, but it turned out not everyone was entirely on board with that and some players/hashpower felt it was better to do a layer two type solution themselves although with bigger blocks servicing the second layer. Throughout what was now emerging as a debate within the BCH camp, Craig Wright and Calvin Ayre of Coin Geek said they were going to support massive on chain scaling, do a node implementation that would aim to restore bitcoin back to the 0.1.0 release which had all kinds of functionality included in it that had later been stripped by Core developers over the years and plan to bankrupt the people from Core who changed their mind on agreeing with on-chain scaling. This lead to a fork off the BCH chain in to bitcoin satoshis vision (BSV) and bitcoin cash ABC. https://bitstagram.bitdb.network/m/raw/cbb50c322a2a89f3c627e1680a3f40d4ad3cee5a3fb153e5d6d001bdf85de404 The premise for this post is that Craig S Wright was Satoshi Nakamoto. It’s an interesting premise because depending upon your frame of reference the premise may either be a fact or to some too outrageous to even believe as a premise. Yesterday it was announced via CoinGeek that Craig Steven Wright has been granted the copyright claim for both the bitcoin white-paper under the pen name Satoshi Nakamoto and the original 0.1.0 bitcoin software (both of which were marked (c) copyright of satoshi nakamoto. The reactions to the news can kind of be classified in to four different reactions. Those who heard it and rejected it, those who heard it but remained undecided, those who heard it and accepted it, and those who already believed he was. Apparently to many the price was unexpected and such a revelation wasn’t exactly priced in to the market with the price immediately pumping nearly 100% upon the news breaking. However, to some others it was a vindication of something they already believed. This is an interesting phenomena to observe. For many years now I have always occupied a somewhat positively contrarian position to the default narrative put forward to things so it’s not entirely surprising that I find myself in a camp that holds the minority opinion. As you can see in the bitcoin dethroned piece I called Craig fake satoshi, but over the last year and bit I investigated the story around Craig and came to my conclusion that I believed him to be at least a major part of a team of people who worked on the protocol I have to admit that through reading his articles, I have kind of been brought full circle to where my contrarian opinion has me becoming somewhat of an advocate for “the system’. https://coingeek.com/bitcoin-creator-craig-s-wright-satoshi-nakamoto-granted-us-copyright-registrations-for-bitcoin-white-paper-and-code/ When the news dropped, many took to social media to see what everyone was saying about it. On /biz/ a barrage of threads popped up discussing it with many celebrating and many rejecting the significance of such a copyright claim being granted. Immediately in nearly every thread there was a posting of an image of a person from twitter claiming that registering for copyright is an easy process that’s granted automatically unless challenged and so it doesn’t mean anything. This was enough for many to convince them of the insignificance of the revelation because of the comment from a person who claimed to have authority on twitter. Others chimed in to add that in fact there was a review of the copyright registration especially in high profile instances and these reviewers were satisfied with the evidence provided by Craig for the claim. At the moment Craig is being sued by Ira Kleiman for an amount of bitcoin that he believes he is entitled to because of Craig and Ira’s brother Dave working together on bitcoin. He is also engaged in suing a number of people from the cryptocurrency community for libel and defamation after they continued to use their social media/influencer positions to call him a fraud and a liar. He also has a number of patents lodged through his company nChain that are related to blockchain technologies. This has many people up in arms because in their mind Satoshi was part of a cypherpunk movement, wanted anonymity, endorsed what they believed to be an anti state and open source technologies and would use cryptography rather than court to prove his identity and would have no interest in patents. https://bitstagram.bitdb.network/m/raw/1fce34a7004759f8db16b2ae9678e9c6db434ff2e399f59b5a537f72eff2c1a1 https://imgur.com/a/aANAsL3) If you listen to Craig with an open mind, what cannot be denied is the man is bloody smart. Whether he is honest or not is up to you to decide, but personally I try to give everyone the benefit of the doubt and then cut them off if i find them to be dishonest. What I haven’t really been able to do with my investigation of craig is cut him off. There have been many moments where I disagree with what he has had to say but I don’t think people having an opinion about something that I believe to be incorrect is the same as being a dishonest person. It’s very important to distinguish the two and if you are unable to do so there is a very real risk of you projecting expectations or ideals upon someone based off your ideas of who they are. Many times if someone is telling the truth but you don’t understand it, instead of acknowledging you don’t understand it, you label them as being stupid or dishonest. I think that has happened to an extreme extent with Craig. Let’s take for example the moment when someone in the slack channel asked Craig if he had had his IQ tested and what it was. Craig replied with 179. The vast majority of people on the internet have heard someone quote their IQ before in an argument or the IQ of others and to hear someone say such a score that is actually 6 standard deviations away from the mean score (so probably something like 1/100 000) immediately makes them reject it on the grounds of probability. Craig admits that he’s not the best with people and having worked with/taught many high functioning people (sometimes on the spectrum perhaps) on complex anatomical and physiological systems I have seen some that also share the same difficulties in relating to people and reconciling their genius and understandings with more average intelligences. Before rejecting his claim outright because we don’t understand much of what he says, it would be prudent to first check is there any evidence that may lend support to his claim of a one in a million intelligence quotient. Craig has mentioned on a number of occasions that he holds a number of different degrees and certifications in relation to law, cryptography, statistics, mathematics, economics, theology, computer science, information technology/security. I guess that does sound like something someone with an extremely high intelligence could achieve. Now I haven’t validated all of them but from a simple check on Charles Sturt’s alumni portal using his birthday of 23rd of October 1970 we can see that he does in fact have 3 Masters and a PhD from Charles Sturt. Other pictures I have seen from his office at nChain have degrees in frames on the wall and a developer published a video titled Craig Wright is a Genius with 17 degrees where he went and validated at least 8 of them I believe. He is recently publishing his Doctorate of Theology through an on-chain social media page that you have to pay a little bit for access to sections of his thesis. It’s titled the gnarled roots of creation. He has also mentioned on a number of occasions his vast industry experience as both a security contractor and business owner. An archive from his LinkedIn can be seen below as well. LinkedIn - https://archive.is/Q66Gl https://youtu.be/nXdkczX5mR0 - Craig Wright is a Genius with 17 Degrees https://www.yours.org/content/gnarled-roots-of-a-creation-mythos-45e69558fae0 - Gnarled Roots of Creation. In fact here is an on chain collection of articles and videos relating to Craig called the library of craig - https://www.bitpaste.app/tx/94b361b205196560d1bd09e4e3b3ec7ad6bea478af204cabfe243efd8fc944dd So there is a guy with 17 degrees, a self professed one in a hundred thousand IQ, who’s worked for Australian Federal Police, ASIO, NSA, NASA, ASX. He’s been in Royal Australian Air Force, operated a number of businesses in Australia, published half a dozen academic papers on networks, cryptography, security, taught machine learning and digital forensics at a number of universities and then another few hundred short articles on medium about his work in these various domains, has filed allegedly 700 patents on blockchain related technology that he is going to release on bitcoin sv, copyrighted the name so that he may prevent other competing protocols from using the brand name, that is telling you he is the guy that invented the technology that he has a whole host of other circumstantial evidence to support that, but people won’t believe that because they saw something that a talking head on twitter posted or that a Core Developer said, or a random document that appears online with a C S Wright signature on it that lists access to an address that is actually related to Roger Ver, that’s enough to write him off as a scam. Even then when he publishes a photo of the paper copy which appears to supersede the scanned one, people still don’t readjust their positions on the matter and resort back to “all he has to do is move the coins or sign a tx”. https://imgur.com/urJbe10 Yes Craig was on the Cypherpunk mailing list back in the day, but that doesn’t mean that he was or is an anarchist. Or that he shares the same ideas that Code Is Law that many from the crypto community like to espouse. I myself have definitely been someone to parrot the phrase myself before reading lots of Craig’s articles and trying to understand where he is coming from. What I have come to learn from listening and reading the man, is that although I might be fed up with the systems we have in place, they still exist to perform important functions within society and because of that the tools we develop to serve us have to exist within that preexisting legal and social framework in order for them to have any chance at achieving global success in replacing fiat money with the first mathematically provably scarce commodity. He says he designed bitcoin to be an immutable data ledger where everyone is forced to be honest, and economically disincentivised to perform attacks within the network because of the logs kept in a Write Once Read Many (WORM) ledger with hierarchical cryptographic keys. In doing so you eliminate 99% of cyber crime, create transparent DAO type organisations that can be audited and fully compliant with legislature that’s developed by policy that comes from direct democratic voting software. Everyone who wants anonymous coins wants to have them so they can do dishonest things, illegal things, buy drugs, launder money, avoid taxes. Now this triggers me a fair bit as someone who has bought drugs online, who probably hasn’t paid enough tax, who has done illegal things contemplating what it means to have that kind of an evidence ledger, and contemplate a reality where there are anonymous cryptocurrencies, where massive corporations continue to be able to avoid taxes, or where methamphetamine can be sold by the tonne, or where people can be bought and sold. This is the reality of creating technologies that can enable and empower criminals. I know some criminals and regard them as very good friends, but I know there are some criminals that I do not wish to know at all. I know there are people that do horrific things in the world and I know that something that makes it easier for them is having access to funds or the ability to move money around without being detected. I know arms, drugs and people are some of the biggest markets in the world, I know there is more than $50 trillion dollars siphoned in to off shore tax havens from the value generated as the product of human creativity in the economy and how much human charity is squandered through the NGO apparatus. I could go on and on about the crappy things happening in the world but I can also imagine them getting a lot worse with an anonymous cryptocurrency. Not to say that I don’t think there shouldn’t be an anonymous cryptocurrency. If someone makes one that works, they make one that works. Maybe they get to exist for a little while as a honeypot or if they can operate outside the law successfully longer, but bitcoin itself shouldn’t be one. There should be something a level playing field for honest people to interact with sound money. And if they operate within the law, then they will have more than adequate privacy, just they will leave immutable evidence for every transaction that can be used as evidence to build a case against you committing a crime. His claim is that all the people that are protesting the loudest about him being Satoshi are all the people that are engaged in dishonest business or that have a vested interest in there not being one singular global ledger but rather a whole myriad of alternative currencies that can be pumped and dumped against one another, have all kinds of financial instruments applied to them like futures and then have these exchanges and custodial services not doing any Know Your Customer (KYC) or Anti Money Laundering (AML) processes. Bitcoin SV was delisted by a number of exchanges recently after Craig launched legal action at some twitter crypto influencetalking heads who had continued to call him a fraud and then didn’t back down when the CEO of one of the biggest crypto exchanges told him to drop the case or he would delist his coin. The trolls of twitter all chimed in in support of those who have now been served with papers for defamation and libel and Craig even put out a bitcoin reward for a DOX on one of the people who had been particularly abusive to him on twitter. A big european exchange then conducted a twitter poll to determine whether or not BSV should be delisted as either (yes, it’s toxic or no) and when a few hundred votes were in favour of delisting it (which can be bought for a couple of bucks/100 votes). Shortly after Craig was delisted, news began to break of a US dollar stable coin called USDT potentially not being fully solvent for it’s apparent 1:1 backing of the token to dollars in the bank. Binance suffered an alleged exchange hack with 7000 BTC “stolen” and the site suspending withdrawals and deposits for a week. Binance holds 800m USDT for their US dollar markets and immediately once the deposits and withdrawals were suspended there was a massive pump for BTC in the USDT markets as people sought to exit their potentially not 1:1 backed token for bitcoin. The CEO of this exchange has the business registered out of Malta, no physical premises, the CEO stays hotel room to hotel room around the world, has all kind of trading competitions and the binance launchpad, uses an unregistered security to collect fees ($450m during the bear market) from the trading of the hundreds of coins that it lists on its exchange and has no regard for AML and KYC laws. Craig said he himself was able to create 100 gmail accounts in a day and create binance accounts with each of those gmail accounts and from the same wallet, deposit and withdraw 1 bitcoin into each of those in one day ($8000 x 100) without facing any restrictions or triggering any alerts or such. This post could ramble on for ever and ever exposing the complexities of the rabbit hole but I wanted to offer some perspective on what’s been happening in the space. What is being built on the bitcoin SV blockchain is something that I can only partially comprehend but even from my limited understanding of what it is to become, I can see that the entirety of the crypto community is extremely threatened as it renders all the various alt coins and alt coin exchanges obsolete. It makes criminals play by the rules, it removes any power from the developer groups and turns the blockchain and the miners in to economies of scale where the blockchain acts as a serverless database, the miners provide computational resources/storage/RAM and you interact with a virtual machine through a monitor and keyboard plugged in to an ethernet port. It will be like something that takes us from a type 0 to a type 1 civilisation. There are many that like to keep us in the quagmire of corruption and criminality as it lines their pockets. Much much more can be read about the Cartel in crypto in the archive below. Is it possible this cartel has the resources to mount such a successful psychological operation on the cryptocurrency community that they manage to convince everyone that Craig is the bad guy, when he’s the only one calling for regulation, the application of the law, the storage of immutable records onchain to comply with banking secrecy laws, for Global Sound Money? https://archive.fo/lk1lH#selection-3671.46-3671.55 Please note, where possible, images were uploaded onto the bitcoin sv blockchain through bitstagram paying about 10c a pop. If I wished I could then use an application etch and archive this post to the chain to be immutably stored. If this publishing forum was on chain too it would mean that when I do the archive the images that are in the bitstragram links (but stored in the bitcoin blockchain/database already) could be referenced in the archive by their txid so that they don’t have to be stored again and thus bringing the cost of the archive down to only the html and css.
A Beginners Guide to Bitcoin, Blockchain & Cryptocurrency
As cryptocurrency, and blockchain technology become more abundant throughout our society, it’s important to understand the inner workings of this technology, especially if you plan to use cryptocurrency as an investment vehicle. If you’re new to the crypto-sphere, learning about Bitcoin makes it much easier to understand other cryptocurrencies as many other altcoins' technologies are borrowed directly from Bitcoin. Bitcoin is one of those things that you look into only to discover you have more questions than answers, and right as you’re starting to wrap your head around the technology; you discover the fact that Bitcoin has six other variants (forks), the amount of politics at hand, or that there are over a thousand different cryptocurrencies just as complex if not even more complex than Bitcoin. We are currently in the infancy of blockchain technology and the effects of this technology will be as profound as the internet. This isn’t something that’s just going to fade away into history as you may have been led to believe. I believe this is something that will become an integral part of our society, eventually embedded within our technology. If you’re a crypto-newbie, be glad that you're relatively early to the industry. I hope this post will put you on the fast-track to understanding Bitcoin, blockchain, and how a large percentage of cryptocurrencies work.
Altcoin: Short for alternative coin. There are over 1,000 different cryptocurrencies. You’re probably most familiar with Bitcoin. Anything that isn’t Bitcoin is generally referred to as an altcoin. HODL: Misspelling of hold. Dank meme accidentally started by this dude. Hodlers are much more interested in long term gains rather than playing the risky game of trying to time the market. TO THE MOON: When a cryptocurrency’s price rapidly increases. A major price spike of over 1,000% can look like it’s blasting off to the moon. Just be sure you’re wearing your seatbelt when it comes crashing down. FUD: Fear. Uncertainty. Doubt. FOMO: Fear of missing out. Bull Run: Financial term used to describe a rising market. Bear Run: Financial term used to describe a falling market.
What Is Bitcoin?
Bitcoin (BTC) is a decentralized digital currency that uses cryptography to secure and ensure validity of transactions within the network. Hence the term crypto-currency. Decentralization is a key aspect of Bitcoin. There is no CEO of Bitcoin or central authoritative government in control of the currency. The currency is ran and operated by the people, for the people. One of the main development teams behind Bitcoin is blockstream. Bitcoin is a product of blockchain technology. Blockchain is what allows for the security and decentralization of Bitcoin. To understand Bitcoin and other cryptocurrencies, you must understand to some degree, blockchain. This can get extremely technical the further down the rabbit hole you go, and because this is technically a beginners guide, I’m going to try and simplify to the best of my ability and provide resources for further technical reading.
A Brief History
Bitcoin was created by Satoshi Nakamoto. The identity of Nakamoto is unknown. The idea of Bitcoin was first introduced in 2008 when Nakamoto released the Bitcoin white paper - Bitcoin: A Peer-to-Peer Electronic Cash System. Later, in January 2009, Nakamoto announced the Bitcoin software and the Bitcoin network officially began. I should also mention that the smallest unit of a Bitcoin is called a Satoshi. 1 BTC = 100,000,000 Satoshis. When purchasing Bitcoin, you don’t actually need to purchase an entire coin. Bitcoin is divisible, so you can purchase any amount greater than 1 Satoshi (0.00000001 BTC).
What Is Blockchain?
Blockchain is a distributed ledger, a distributed collection of accounts. What is being accounted for depends on the use-case of the blockchain itself. In the case of Bitcoin, what is being accounted for is financial transactions. The first block in a blockchain is referred to as the genesis block. A block is an aggregate of data. Blocks are also discovered through a process known as mining (more on this later). Each block is cryptographically signed by the previous block in the chain and visualizing this would look something akin to a chain of blocks, hence the term, blockchain. For more information regarding blockchain I’ve provided more resouces below:
Bitcoin mining is one solution to the double spend problem. Bitcoin mining is how transactions are placed into blocks and added onto the blockchain. This is done to ensure proof of work, where computational power is staked in order to solve what is essentially a puzzle. If you solve the puzzle correctly, you are rewarded Bitcoin in the form of transaction fees, and the predetermined block reward. The Bitcoin given during a block reward is also the only way new Bitcoin can be introduced into the economy. With a halving event occurring roughly every 4 years, it is estimated that the last Bitcoin block will be mined in the year 2,140. (See What is Block Reward below for more info). Mining is one of those aspects of Bitcoin that can get extremely technical and more complicated the further down the rabbit hole you go. An entire website could be created (and many have) dedicated solely to information regarding Bitcoin mining. The small paragraph above is meant to briefly expose you to the function of mining and the role it plays within the ecosystem. It doesn’t even scratch the surface regarding the topic.
How do you Purchase Bitcoin?
The most popular way to purchase Bitcoin through is through an online exchange where you trade fiat (your national currency) for Bitcoin. Popular exchanges include:
There’s tons of different exchanges. Just make sure you find one that supports your national currency.
Bitcoin and cryptocurrencies are EXTREMELY volatile. Swings of 30% or more within a few days is not unheard of. Understand that there is always inherent risks with any investment. Cryptocurrencies especially. Only invest what you’re willing to lose.
Transaction & Network Fees
Transacting on the Bitcoin network is not free. Every purchase or transfer of Bitcoin will cost X amount of BTC depending on how congested the network is. These fees are given to miners as apart of the block reward. Late 2017 when Bitcoin got up to $20,000USD, the average network fee was ~$50. Currently, at the time of writing this, the average network fee is $1.46. This data is available in real-time on BitInfoCharts.
In this new era of money, there is no central bank or government you can go to in need of assistance. This means the responsibility of your money falls 100% into your hands. That being said, the security regarding your cryptocurrency should be impeccable. The anonymity provided by cryptocurrencies alone makes you a valuable target to hackers and scammers. Below I’ve detailed out best practices regarding securing your cryptocurrency.
Two-Factor Authentication (2FA)
Two-factor authentication is a second way of authenticating your identity upon signing in to an account. Most cryptocurrency related software/websites will offer or require some form of 2FA. Upon creation of any crypto-related account find the Security section and enable 2FA.
The most basic form of 2FA which you are probably most familiar with. This form of authentication sends a text message to your smartphone with a special code that will allow access to your account upon entry. Note that this is not the safest form of 2FA as you may still be vulnerable to what is known as a SIM swap attack. SIM swapping is a social engineering method in which an attacker will call up your phone carrier, impersonating you, in attempt to re-activate your SIM card on his/her device. Once the attacker has access to your SIM card he/she now has access to your text messages which can then be used to access your online accounts. You can prevent this by using an authenticator such as Google Authenticator.
The use of an authenticator is the safest form of 2FA. An authenticator is installed on a seperate device and enabling it requires you input an ever changing six digit code in order to access your account. I recommend using Google Authenticator. If a website has the option to enable an authenticator, it will give you a QR code and secret key. Use Google Authenticator to scan the QR code. The secret key consists of a random string of numbers and letters. Write this down on a seperate sheet of paper and do not store it on a digital device. Once Google Authenticator has been enabled, every time you sign into your account, you will have to input a six-digit code that looks similar to this. If you happen to lose or damage the device you have Google Authenticator installed on, you will be locked out of your account UNLESS you have access to the secret key (which you should have written down).
A wallet is what you store Bitcoin and cryptocurrency on. I’ll provide resources on the different type of wallets later but I want to emphasize the use of a hardware wallet (aka cold storage). Hardware wallets are the safest way of storing cryptocurrency because it allows for your crypto to be kept offline in a physical device. After purchasing crypto via an exchange, I recommend transferring it to cold storage. The most popular hardware wallets include the Ledger Nano S, and Trezor. Hardware wallets come with a special key so that if it gets lost or damaged, you can recover your crypto. I recommend keeping your recovery key as well as any other sensitive information in a safety deposit box. I know this all may seem a bit manic, but it is important you take the necessary security precautions in order to ensure the safety & longevity of your cryptocurrency.
Technical Aspects of Bitcoin
Address: What you send Bitcoin to.
Wallet: Where you store your Bitcoin
Max Supply: 21 million
Block Time: ~10 minutes
Block Size: 1-2 MB
Block Reward: BTC reward received from mining.
What is a Bitcoin Address?
A Bitcoin address is what you send Bitcoin to. If you want to receive Bitcoin you’d give someone your Bitcoin address. Think of a Bitcoin address as an email address for money.
What is a Bitcoin Wallet?
As the title implies, a Bitcoin wallet is anything that can store Bitcoin. There are many different types of wallets including paper wallets, software wallets and hardware wallets. It is generally advised NOT to keep cryptocurrency on an exchange, as exchanges are prone to hacks (see Mt. Gox hack). My preferred method of storing cryptocurrency is using a hardware wallet such as the Ledger Nano S or Trezor. These allow you to keep your crypto offline in physical form and as a result, much more safe from hacks. Paper wallets also allow for this but have less functionality in my opinion. After I make crypto purchases, I transfer it to my Ledger Nano S and keep that in a safe at home. Hardware wallets also come with a special key so that if it gets lost or damaged, you can recover your crypto. I recommend keeping your recovery key in a safety deposit box.
What is Bitcoins Max Supply?
The max supply of Bitcoin is 21 million. The only way new Bitcoins can be introduced into the economy are through block rewards which are given after successfully mining a block (more on this later).
What is Bitcoins Block Time?
The average time in which blocks are created is called block time. For Bitcoin, the block time is ~10 minutes, meaning, 10 minutes is the minimum amount of time it will take for a Bitcoin transaction to be processed. Note that transactions on the Bitcoin network can take much longer depending on how congested the network is. Having to wait a few hours or even a few days in some instances for a transaction to clear is not unheard of. Other cryptocurrencies will have different block times. For example, Ethereum has a block time of ~15 seconds. For more information on how block time works, Prabath Siriwardena has a good block post on this subject which can be found here.
What is Bitcoins Block Size?
There is a limit to how large blocks can be. In the early days of Bitcoin, the block size was 36MB, but in 2010 this was reduced to 1 MB in order to prevent distributed denial of service attacks (DDoS), spam, and other malicious use on the blockchain. Nowadays, blocks are routinely in excess of 1MB, with the largest to date being somewhere around 2.1 MB. There is much debate amongst the community on whether or not to increase Bitcoin’s block size limit to account for ever-increasing network demand. A larger block size would allow for more transactions to be processed. The con argument to this is that decentralization would be at risk as mining would become more centralized. As a result of this debate, on August 1, 2017, Bitcoin underwent a hard-fork and Bitcoin Cash was created which has a block size limit of 8 MB. Note that these are two completely different blockchains and sending Bitcoin to a Bitcoin Cash wallet (or vice versa) will result in a failed transaction. Update: As of May 15th, 2018 Bitcoin Cash underwent another hard fork and the block size has increased to 32 MB. On the topic of Bitcoin vs Bitcoin Cash and which cryptocurrency is better, I’ll let you do your own research and make that decision for yourself. It is good to know that this is a debated topic within the community and example of the politics that manifest within the space. Now if you see community members arguing about this topic, you’ll at least have a bit of background to the issue.
What is Block Reward?
Block reward is the BTC you receive after discovering a block. Blocks are discovered through a process called mining. The only way new BTC can be added to the economy is through block rewards and the block reward is halved every 210,000 blocks (approximately every 4 years). Halving events are done to limit the supply of Bitcoin. At the inception of Bitcoin, the block reward was 50BTC. At the time of writing this, the block reward is 12.5BTC. Halving events will continue to occur until the amount of new Bitcoin introduced into the economy becomes less than 1 Satoshi. This is expected to happen around the year 2,140. All 21 million Bitcoins will have been mined. Once all Bitcoins have been mined, the block reward will only consist of transaction fees.
Any computer that connects to the Bitcoin network is called a node. Nodes that fully verify all of the rules of Bitcoin are called full nodes.
In other words, full nodes are what verify the Bitcoin blockchain and they play a crucial role in maintaining the decentralized network. Full nodes store the entirety of the blockchain and validate transactions. Anyone can participate in the Bitcoin network and run a full node. Bitcoin.org has information on how to set up a full node. Running a full node also gives you wallet capabilities and the ability to query the blockchain. For more information on Bitcoin nodes, see Andreas Antonopoulos’s Q&A on the role of nodes.
What is a Fork?
A fork is a divergence in a blockchain. Since Bitcoin is a peer-to-peer network, there’s an overall set of rules (protocol) in which participants within the network must abide by. These rules are put in place to form network consensus. Forks occur when implementations must be made to the blockchain or if there is disagreement amongst the network on how consensus should be achieved.
Soft Fork vs Hard Fork
The difference between soft and hard forks lies in compatibility. Soft forks are backwards compatible, hard forks are not. Think of soft forks as software upgrades to the blockchain, whereas hard forks are a software upgrade that warrant a completely new blockchain. During a soft fork, miners and nodes upgrade their software to support new consensus rules. Nodes that do not upgrade will still accept the new blockchain. Examples of Bitcoin soft forks include:
A hard fork can be thought of as the creation of a new blockchain that X percentage of the community decides to migrate too. During a hard fork, miners and nodes upgrade their software to support new consensus rules, Nodes that do not upgrade are invalid and cannot accept the new blockchain. Examples of Bitcoin hard forks include:
Note that these are completely different blockchains and independent from the Bitcoin blockchain. If you try to send Bitcoin to one of these blockchains, the transaction will fail.
A Case For Bitcoin in a World of Centralization
Our current financial system is centralized, which means the ledger(s) that operate within this centralized system are subjugated to control, manipulation, fraud, and many other negative aspects that come with this system. There are also pros that come with a centralized system, such as the ability to swiftly make decisions. However, at some point, the cons outweigh the pros, and change is needed. What makes Bitcoin so special as opposed to our current financial system is that Bitcoin allows for the decentralized transfer of money. Not one person owns the Bitcoin network, everybody does. Not one person controls Bitcoin, everybody does. A decentralized system in theory removes much of the baggage that comes with a centralized system. Not to say the Bitcoin network doesn’t have its problems (wink wink it does), and there’s much debate amongst the community as to how to go about solving these issues. But even tiny steps are significant steps in the world of blockchain, and I believe Bitcoin will ultimately help to democratize our financial system, whether or not you believe it is here to stay for good.
Well that was a lot of words… Anyways I hope this guide was beneficial, especially to you crypto newbies out there. You may have come into this realm not expecting there to be an abundance of information to learn about. I know I didn’t. Bitcoin is only the tip of the iceberg, but now that you have a fundamental understanding of Bitcoin, learning about other cryptocurrencies such as Litecoin, and Ethereum will come more naturally. Feel free to ask questions below! I’m sure either the community or myself would be happy to answer your questions. Thanks for reading!
Hi everyone. I noticed no-one has really brought up this whole saga on this sub. What do us Aussies think of another Aussie claiming to be Satoshi? I wrote a short article to generate some discussion. Bitcoin SV has been de-listed by the world’s largest exchange, Binance. In a huge announcement that has sent shockwaves through the cryptocurrency community; Binance CEO Chanpeng Zhao confirmed that BCHSV (BSV) would be removed from their list of tradeable cryptocurrencies. The official support page lists multiple reasons why the exchange would remove a digital asset. The list includes a review ascertaining whether the asset has contributed to a healthy and sustainable crypto ecosystem. This is where Craig Wright (BSV creator) and his recent behaviour becomes relevant. Craig Wright had recently been claiming to be the creator of Bitcoin, the anonymous ‘Satoshi Nakamoto’. This had ruffled the feathers of Zhao, who then tweeted about Wright being poisonous to the Bitcoin community. Members of the world wide crypto community believe there are only a handful of ways a person can prove oneself as Nakomoto. The easiest way is for the individual to send a transaction from Nakamoto’s known wallet. Failing that, a message using Nakamoto’s bitcointalk forum account would carry some serious weight. Craig Wright has done neither of these, or anything close. What Wright has done however, is threaten to sue crypto social media personalities such as Hodlonaut; for not recognizing him as Nakamoto. Bitcoin SV advocates maintain that the delisting of BSV is setting a dangerous precedent. They believe that it is a form of manipulation due to price change being tied in so heavily with exchange listing and delisting. Furthermore, the ongoing feud between BCHABC and BCHSV has BSV supporters believing one side has been chosen over the other artificially, instead of letting the market decide. One thing is for certain, Craig Wright and Bitcoin SV have their hands full. Following the Binance decision, multiple other exchanges have followed suit in delisting the digital asset including Kraken, Bitsane and Shapeshift. If Bitcoin SV is to survive, it must fight through its own ‘crypto winter’. In the meantime BTC and BCHABC are steadily pulling away in market price and share. Original article: https://learn.easycrypto.com.au/bitcoin-sv-delisting-summarised/
The core purpose of the cross-chain technology is as one of the key infrastructures of the future economy based on digital currencies.
https://preview.redd.it/3d61f26utn621.png?width=720&format=png&auto=webp&s=b735482c9734e1d32176e406adce1718be20583e Cross chain technology is one of the foundational technological infrastructures that is necessary for the large scale application of blockchain technology. Neutrino: As we all know, there are many different kinds of cross-chain technologies. Please give us a brief introduction to several popular cross-chain technologies on the market, and the characteristics of each of these technologies。 Lini: Before answering this question, it is very important to share two important concepts with our friends: heterogeneity and homogeneity, and centralization and decentralization. https://preview.redd.it/n6wbs77wtn621.png?width=720&format=png&auto=webp&s=83fcadd09afb214d2aa5a2a6deb6c24d0d4da671 These two points are especially important for understanding various cross-chain technologies, because there are many different technologies and terminologies, and these are some of the foundational concepts needed for understanding them. There are also two core challenges which must be overcome to implement cross-chain: https://preview.redd.it/84wqd28ytn621.png?width=720&format=png&auto=webp&s=dafe1cd2993f853547b532421404e6ab86e185f1 Combining the above two points, we look at the exploration of some solutions in the industry and the design concepts of other cross-chain projects. First I’d like to discuss the Relay solution. https://preview.redd.it/qgcqiwlztn621.png?width=720&format=png&auto=webp&s=0925d4221c9e92e365e150638c645bef8c609b3f However the Relay solution must consume a relatively large amount of gas to read the BTC header. Another downside is that, as we all know, Bitcoin’s blocks are relatively slow, so the time to wait for verification will be long, it usually takes about 10 minutes to wait for one block to confirm, and the best practice is to wait for 6 blocks. The next concept is the idea of Sidechains. https://preview.redd.it/9cg79bl1un621.png?width=720&format=png&auto=webp&s=1260e14213b1757eadc4b6141a365ed3b0e20316 This solution is good, but not all chains contain SPV, a simple verification method. Therefore, there are certain drawbacks. Of course, this two way peg way solves challenge beta very well, that is, the atomicity of the transaction. These two technical concepts have already been incorporated into a number of existing cross chain projects. Let’s take a look at two of the most influential of these. The first is Polkadot. https://preview.redd.it/1o3xwz93un621.png?width=720&format=png&auto=webp&s=249909a33b5420050a6010b961a944285fc94926 This is just a summary based on Polkadot’s whitepaper and most recent developments. The theoretical design is very good and can solve challenges alpha and beta. Last week, Neutrino organized a meetup with Polkadot, which we attended. In his talk, Gavin’s focus was on governance, he didn’t get into too much technical detail, but Gavin shared some very interesting ideas about chain governance mechanisms! The specific technical details of Polkadot may have to wait until after their main net is online before it can be analyzed. Next is Cosmos. https://preview.redd.it/5gtjf6x4un621.png?width=720&format=png&auto=webp&s=94d6408ff65dc7041316f0130867888e108848b2 Cosmos is a star project who’s basic concept is similar to Polkadot. Cosmos’s approach is based on using a central hub. Both projects both take into account the issue of heterogeneous cross-chain transactions, and both have also taken into account how to solve challenges alpha and beta. To sum up, each research and project team has done a lot of exploration on the best methods for implementing cross-chain technology, but many are still in the theoretical design stage. Unfortunately, since the main net has not launched yet, it is not possible to have a more detailed understanding of each project’s implementation. A blockchain’s development can be divided into two parts: theoretical design, and engineering implementation. Therefore, we can only wait until after the launch of each project’s main network, and then analyze it in more detail. Neutrino: As mentioned in the white paper, Wanchain is a general ledger based on Ethereum, with the goal of building a distributed digital asset financial infrastructure. There are a few questions related to this. How do you solve Ethereum’s scaling problem? How does it compare with Ripple, which is aiming to be the standard trading protocol that is common to all major banks around the world? As a basic potential fundamental financial infrastructure, what makes Wanchain stand out? Lini: This question is actually composed of two small questions. Let me answer the first one first.
Considerations about TPS.
First of all, Wanchain is not developed on Ethereum. Instead, it draws on some of Ethereum’s code and excellent smart contracts and virtual machine EVM and other mature technical solutions to build the mainnet of Wanchain. The TPS of Ethereum is not high at this stage, which is limited by various factors such as the POW consensus mechanism. However, this point also in part is due to the characteristics of Ethereum’s very distributed and decentralized features. Therefore, in order to improve TPS, Wanchain stated in its whitepaper that it will launch its own POS consensus, thus partially solving the performance issues related to TPS. Wanchain’s POS is completely different from the POS mechanism of Ethereum 2.0 Casper. Of course, at the same time, we are also paying close attention to many good proposals from the Ethereum community, such as sharding, state channels, side chains, and the Raiden network. Since blockchain exists in the world of open source, we can of course learn from other technological breakthroughs and use our own POS to further improve TPS. If we have some time at the end, I’d love to share some points about Wanchain’s POS mechanism.
Concerning, Ripple, it is completely different from what Wanchain hopes to do.
Ripple is focused on exchanges between different fiat pairs, the sharing of data between banks and financial institutions, as a clearing and settlement system, and also for the application of DLT, for example the Notary agent mechanism. Wanchain is focused on different use cases, it is to act as a bridge between different tokens and tokens, and between assets and tokens. For various cross-chain applications it is necessary to consume WAN as a gas fee to pay out to nodes. So it seems that the purpose Ripple and Wanchain serve are quite different. Of course, there are notary witnesses in the cross-chain mechanism, that is, everyone must trust the middleman. Ripple mainly serves financial clients, banks, so essentially everyone’s trust is already there. Neutrino: We see that Wanchain uses a multi-party computing and threshold key sharing scheme for joint anchoring, and achieves “minimum cost” for integration through cross-chain communication protocols without changing the original chain mechanism. What are the technical characteristics of multi-party computing and threshold key sharing? How do other chains access Wanchain, what is the cross-chain communication protocol here? What is the cost of “minimum cost? Lini: The answer to this question is more technical, involving a lot of cryptography, I will try to explain it in a simple way.
About sMPC -
It stands for secure multi-party computation. I will explain it using an example proposed by the scholar Andrew Yao, the only Turing Award winner in China. The scenario called Yao’s Millionaire Problem. How can two millionaires know who is wealthier without revealing the details of their wealth to each other or a trusted third party? I’m not going to explain the answer in detail here, but those who are interested can do a web search to learn more. In sMPC multiple parties each holding their own piece of private data jointly perform a calculation (for example, calculating a maximum value) and obtain a calculation result. However, in the process, each party involved does not leak any of their respective data. Essentially sMPC calculation can allow for designing a protocol without relying on any trusted third parties, since no individual ever has access to the complete private information. Secure multiparty computing can be abstractly understood as two parties who each have their own private data, and can calculate the results of a public function without leaking their private data. When the entire calculation is completed, only the calculation results are revealed to both parties, and neither of them knows the data of the other party and the intermediate data of the calculation process. The protocol used for secure multiparty computing is homomorphic encryption + secret sharing + OT (+ commitment scheme + zero knowledge proofs, etc.) Wanchain’s 21 cross chain Storeman nodes use sMPC to participate in the verification of a transaction without obtaining of a user’s complete private key. Simply put, the user’s private key will have 21 pieces given to 21 anonymous people who each can only get 1/21 part, and can’t complete the whole key.
Shamir’s secret sharing
There are often plots in a movie where a top secret document needs to be handed over to, let’s say five secret agents. In order to protect against the chance of an agent from being arrested or betraying the rest, the five agents each hold only part of a secret key which will reveal the contents of the documents. But there is also a hidden danger: if one the agents are really caught, how can the rest of the agents access the information in the documents? At this point, you may wonder if there is any way for the agents to still recover the original text with only a portion of the keys? In other words, is there any method that allows a majority of the five people to be present to unlock the top secret documents? In this case, the enemy must be able to manipulate more than half of the agents to know the information in the secret documents. Wanchain uses the threshold M<=N; N=21; M=16. That is to say, at least 16 Storeman nodes must participate in multi-party calculation to confirm a transaction. Not all 21 Storeman nodes are required to participate. This is a solution to the security problem of managing private keys. Cross-chain communication protocols refers to the different communication methods used by different chains. This is because heterogeneous cross-chain methods can’t change the mechanism of the original chains. Nakamoto and Vitalik will not modify their main chains because they need BTC and ETH interoperability. Therefore, project teams that can only do cross-chain agreements to create different protocols for each chain to “talk”, or communicate. So the essence of a cross-chain protocol is not a single standard, but a multiple sets of standards. But there is still a shared sMPC and threshold design with the Storeman nodes. The minimum cost is quite low, as can be shown with Wanchain 3.0’s cross chain implementation. In fact it requires just two smart contracts, one each on Ethereum and Wanchain to connect the two chains. To connect with Bitcoin all that is needed is to write a Bitcoin script. Our implementation guarantees both security and decentralization, while at the same time remaining simple and consuming less computation. The specific Ethereum contract and Bitcoin scripts online can be checked out by anyone interested in learning more. Neutrino: What kind of consensus mechanism is currently used by Wanchain? In addition, what is the consensus and incentive mechanism for cross-chain transactions, and what is the purpose of doing so? And Wanchain will support cross-chain transactions (such as BTC, ETH) on mainstream public chains, asset cross-chain transactions between the alliance chains, and cross-chain transactions between the public and alliance chains, how can you achieve asset cross-chain security and privacy? Lini: It is now PPOW (Permissioned Proof of Work), in order to ensure the reliability of the nodes before the cross-chain protocol design is completed, and to prepare to switch to POS (as according to the Whitepaper roadmap). The cross-chain consensus has been mentioned above, with the participation of a small consensus (at least 16 nodes) in a set of 21 Storeman nodes through sMPC and threshold secret sharing. In addition, the incentive is achieved through two aspects: 1) 100% of the cross chain transaction fee is used to reward the Storeman node; 2) Wanchain has set aside a portion of their total token reserve as an incentive mechanism for encouraging Storeman nodes in case of small cross-chain transaction volume in the beginning. It can be revealed that Storeman participation is opening gradually and will become completely distributed and decentralized in batches. The first phase of the Storeman node participation and rewards program is to be launched at the end of 2018. It is expected that the selection of participants will be completed within one quarter. Please pay attention to our official announcements this month. In addition, for public chains, consortium chains, and private chains, asset transfer will also follow the cross-chain mechanism mentioned above, and generally follow the sMPC and threshold integration technology to ensure cross-chain security. When it comes to privacy, this topic will be bigger. Going back to the Wanchain Whitepaper, we have provided privacy protection on Wanchain mainnet. Simply put, the principle is using ring signatures. The basic idea is that it mixes the original address with many other addresses to ensure privacy. We also use one-time address. In this mechanism a stamp system is used that generates a one-time address from a common address. This has been implemented since our 2.0 release. But now only the privacy protection of native WAN transactions can be provided. The protection of cross-chain privacy and user experience will also be one of the important tasks for us in 2019. Neutrino: At present, Wanchain uses Storeman as a cross-chain trading node. Can you introduce the Storeman mechanism and how to protect these nodes? Lini: Let me one problem from two aspects.
As I introduced before in my explanation of sMPC, the Storeman node never holds the user’s private key, but only calculates the transaction in an anonymous and secure state, and the technology prevents the Storeman nodes from colluding.
Even after technical guarantees, we also designed a “double protection” against the risk from an economic point of view, that is, each node participating as a Storeman needs to pledge WAN in the contract as a “stake”. The pledge of WAN will be greater than the amount of any single transaction as a guarantee against loss of funds.
If the node is malicious (even if it is a probability of one in a billion), the community will be compensated for the loss caused by the malicious node by confiscation of the staked WAN. This is like the POS mechanism used by ETH, using staking to prevent bad behavior is a common principle. Neutrino: On December 12th, the mainnet of Wanchain 3.0 was launched. Wanchain 3.0 opened cross-chain transactions between Bitcoin, Ethereum and ERC20 (such as MakerDao’s stable currency DAI and MKR). What does this version mean for you and the industry? This upgrade of cross-chain with Bitcoin is the biggest bright spot. So, if now you are able to use Wanchain to make transactions between what is the difference between tokens, then what is the difference between a cross chain platform like Wanchain and cryptocurrency exchanges? Lini: The release of 3.0 is the industry’s first major network which has crossed ETH and BTC, and it has been very stable so far. As mentioned above, many cross-chain, password-protected theoretical designs are very distinctive, but for engineering implementation, the whether or not it can can be achieved is a big question mark. Therefore, this time Wanchain is the first network launched in the world to achieve this. Users are welcome to test and attack. This also means that Wanchain has connected the two most difficult and most challenging public networks. We are confident we will soon be connecting other well-known public chains. At the same time of the release of 3.0, we also introduced cross chain integration with other ERC20 tokens in the 2.X version, such as MakerDao’s DAI, MKR, LRC, etc., which also means that more tokens of excellent projects on Ethereum will also gradually be integrated with Wanchain. Some people will be curious, since Wanchain has crossed so many well-known public chains/projects; how is it different with crypto exchanges? In fact, it is very simple, one centralized; one distributed. Back to the white paper of Nakamoto, is not decentralization the original intention of blockchain? So what Wanchain has to do is essentially to solve the bottom layer of the blockchain, one of the core technical difficulties. Anyone trying to create a DEX (decentralized exchange); digital lending and other application scenarios can base their application on Wanchain. There is a Wanchain based DEX prototype made by our community members Jeremiah and Harry, which quite amazing. Take a look at this video below. https://www.youtube.com/watch?v=codcqb66G6Q Neutrino: What are the specific application use cases after the launch of Wanchain 3.0? Most are still exploring small-scale projects. According to your experience, what are the killer blockchain applications of the future? What problems need to be solved during this period? How many years does it take? Lini:
Wanchain is just a technology platform rather than positioning itself as an application provider; that is, Wanchain will continue to support the community, and the projects which use cross-chain technology to promote a wide range of use cases for Wanchain.
Cross-chain applications that we anticipate include things like: decentralized exchanges, digital lending, cross chain games, social networking dAPPs, gambling, etc. We also expect to see applications using non fungible tokens, for example exchange of real assets, STOs, etc.
We recently proposed the WanDAPP solution. Simply speaking, a game developer for example has been developing on Ethereum, and ERC20 tokens have been issued, but they hope to expand the player base of their games to attract more people. To participate and make full use of their DAPP, you can consider using the WanDAPP solution to deploy the game DAPP on other common platforms, such as EOS, TRON, etc., but you don’t have to issue new tokens on these chains or use the previous ERC20 tokens. In this way the potential user population of the game can be increased greatly without issuing more tokens on a new chain, improving the real value of the original token. This is accomplished completely using the cross-chain mechanism of Wanchain.
For large-scale applications, the infrastructure of the blockchain is not yet complete, there are issues which must first be dealt with such as TPS, sharding, sidechains, state channels, etc. These all must be solved for the large-scale application of blockchain applications. I don’t dare to guess when it will be completed, it depends on the progress of various different technical projects. In short, industry practitioners and enthusiasts need a little faith and patience.
Neutrino community member Block Venture Capital Spring: Will Wanchain be developing any more cross chain products aimed at general users? For example will the wallet be developed to make automatic cross chain transfers with other public chains? Another issue the community is concerned about is the currency issuance. Currently there are more than 100 million WAN circulating, what about the rest, when will it be released? Lini: As a cross-chain public chain, we are not biased towards professional developers or ordinary developers, and they are all the same. As mentioned above, we provide a platform as infrastructure, and everyone is free to develop applications on us. For example, if it is a decentralized exchange, it must be for ordinary users to trade on; if it is some kind of financial derivatives product, it is more likely to be used by finance professionals. As for cross-chain wallets which automatically exchange, I’m not sure if you are talking about distributed exchanges, the wallet will not be “automatic” at first, but you can “automatically” redeem other tokens. Finally, the remaining WAN tokens are strictly in accordance with the plan laid out in the whitepaper. For example, the POS node reward mentioned above will give 10% of the total amount for reward. At the same time, for the community, there are also rewards for the bounty program. The prototype of the DEX that I just saw is a masterpiece of the overseas community developers, and also received tokens from our incentive program. Neutrino community member’s question: There are many projects in the market to solve cross-chain problems, such as: Cosmos, Polkadot, what are Wanchain’s advantages and innovations relative to these projects? Lini: As I mentioned earlier, Cosmos and pPolkadot all proposed very good solutions in theory. Compared with Wanchain, I don’t think that we have created anything particularly unique in our theory. The theoretical basis for our work is cryptography, which is derived from the academic foundation of scholars such as Yao Zhizhi and Silvio Micali. Our main strong point is that we have taken theory and put it into practice.. Actually, the reason why people often question whether a blockchain project can be realized or not is because the whitepapers are often too ambitious. Then when they actually start developing there are constant delays and setbacks. So for us, we focus on completing our very solid and realizable engineering goals. As for other projects, we hope to continue to learn from each other in this space. Neutrino community member Amos from Huobi Research Institute question: How did you come to decide on 21 storeman nodes? Lini: As for the nodes we won’t make choices based on quantity alone. The S in the POS actually also includes the time the tokens are staked, so that even if a user is staking less tokens, the amount of time they stake them for will also be used to calculate the award, so that is more fair. We designed the ULS (Unique Leader Selection) algorithm in order to reduce the reliance on the assumption of corruption delay (Cardano’s POS theory). which is used for ensuring fairness to ensure that all participants in the system can have a share of the reward, not only few large token holders. Wu Di, a member of the Neutrino community: Many big exchanges have already begun to deploy decentralized exchanges. For example, Binance, and it seems that the progress is very fast. Will we be working with these influential exchanges in the future? We we have the opportunity to cooperate with them and broaden our own influence? Lini: I also have seen some other exchange’s DEX. Going back the original point, distributed cross-chain nodes and centralized ones are completely different. I’m guessing that most exchanges use a centralized cross-chain solution, so it may not be the same as the 21 member Storeman group of Wanchain, but I think that most exchanges will likely be using their own token and exchange system. This is my personal understanding. But then, if you are developing cross chain technology, you will cooperate with many exchanges that want to do a DEX. Not only Binance, but also Huobi, Bithumb, Coinbase… And if there is anyone else who would like to cooperate we welcome them! Neutrino community member AnneJiang from Maker: Dai as the first stable chain of Wanchain will open a direct trading channel between Dai and BTC. In relation to the Dai integration, has any new progress has been made on Wanchain so far? Lini: DAI’s stable currency has already been integrated on Wanchain. I just saw it yesterday, let me give you a picture. It’s on the current 3.0 browser, https://www.wanscan.org/, you can take a look at it yourself. This means that users with DAI are now free to trade for BTC, or ETH or some erc20 tokens. There is also a link to the Chainlink, and LRC is Loopring, so basically there are quite a few excellent project tokens. You may use the Wanchain to trade yourself, but since the DEX is not currently open, currently you can only trade with friends you know. https://preview.redd.it/jme5s99bun621.png?width=800&format=png&auto=webp&s=7ba3d430ba3e7ddcab4dbcdedc05d596d832f5a7
Neutrino is a distributed, innovative collaborative community of blockchains. At present, we have established physical collaboration spaces in Tokyo, Singapore, Beijing, Shanghai and other places, and have plans to expand into important blockchain innovation cities such as Seoul, Thailand, New York and London. Through global community resources and partnerships, Neutrino organizes a wide range of online an offline events, seminars, etc. around the world to help developers in different regions better communicate and share their experiences and knowledge.
Wanchain is a blockchain platform that enables decentralized transfer of value between blockchains. The Wanchain infrastructure enables the creation of distributed financial applications for individuals and organizations. Wanchain currently enables cross-chain transactions with Ethereum, and today’s product launch will enable the same functionalities with Bitcoin. Going forward, we will continue to bridge blockchains and bring cross-chain finance functionality to companies in the industry. Wanchain has employees globally with offices in Beijing (China), Austin (USA), and London (UK). You can find more information about Wanchain on our website. Additionally, you can reach us through Telegram, Discord, Medium, Twitter, and Reddit. You can also sign up for our monthly email newsletter here. https://preview.redd.it/w7ezx27dun621.png?width=720&format=png&auto=webp&s=6ef7a651a2d480658f60d213e1431ba636bfbd8c
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