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Ripple Overtakes Ethereum to Become Second Largest Crypto After Japanese Bank Consortium Formed

Ripple Overtakes Ethereum to Become Second Largest Crypto After Japanese Bank Consortium Formed

    

Rather unexpectedly, Ripple officially took over Ethereum

by $200 mln in market cap to become the world’s second largest cryptocurrency with a total market cap of $8.5 bln. Over a 24-hour period, Ripple price recorded a 71.6 percent increase, while Ethereum price decreased by 6.85 percent. Several cryptocurrencies including Ripple, NEM, and Stellar Lumens experienced inorganic short-term price growth in the last 24 hours, each gaining 71.6 percent, 53.4 percent and 94.81 percent daily gains respectively. Although Ripple has made significant progress in establishing strategic partnerships such as the recent addition of 10 new financial institutions including MUFG, BBVA, SEB, Akbank, Axis Bank, YES BANK, SBI Remit, Cambridge Global Payments, Star One Credit Union and eZforex.com, it is difficult to justify its 71 percent gain in such a short period of time.

Japanese Consortium announced

The latest partnership or initiative launched by Ripple was 11 days ago and no major exchanges or trading platforms globally have integrated support for Ripple trading in the past few weeks. Thus, to be critical, a 71 percent increase in Ripple price seems fairly inorganic. The only driving factor that could explain Ripple’s latest price surge is the establishment of a collaborative project amongst banks in the Japanese Consortium for cross-border and domestic payments. According to its official introduction video, Ripple is powering the entire network with its Blockchain-based cross-border and cross-bank payment protocol.

Japan Bank Consortium stated:

“In order to address these emerging needs, banks have come together to launch the Japan Bank Consortium for cross-border and domestic payments which enable a flexible and efficient payment system. It is the world’s first case to implement Ripple solution in a cloud environment.”

With its partnership with Japan Bank Consortium and other leading banks and financial institutions in Europe such as BBVA, Ripple has solidified its position as the base Blockchain protocol for the global financial structure and industry.

What does it mean for Ethereum?

Ethereum has implemented a similar partnership-based strategy with the launch of the Enterprise Ethereum Alliance earlier this year. While it is still uncertain whether Ripple’s short-term growth will stabilize over the long run, Ethereum and Ripple are both utilizing the same strategy to appeal to large-scale conglomerates and banks. Although Ethereum has attracted the likes of JPMorgan, Ripple seems to have grasped the attention of multi-billion dollar banks and financial institutions.

Chuck Reynolds
Contributor
Please click either Link to Learn more about
-Bitcoin.

Alan Zibluk – Markethive Founding Member

Bitcoin? Ethereum? Ripple? Three Reasons to Consider Investing in Cryptocurrency

Bitcoin? Ethereum? Ripple?
Three Reasons to Consider Investing in Cryptocurrency

    

Bitcoin is beginning to seem like a viable currency,

especially since reaching the $2,000 mark. Major setbacks, such as the loss of $480 mln due to Mt. Gox’s neglectful management of Bitcoins, have caused the cryptocurrency to plummet in the past. Slowly but surely, the first-ever Blockchain currency has climbed back.

Presently, Bitcoin is performing better than it ever has. Early in 2017, Bitcoin price hit historic highs, surpassing the value of gold. Nearly a decade after Bitcoin’s quiet release, dozens of copycat currencies have arisen. Utilizing Blockchain, a public database or ledger that records transactions involving encrypted keys, developers are vying to improve the original digital currency. A few, namely Ripple and Ethereum, have proved to be exceptional competitors. Indeed, the Ethereum Enterprise Alliance was formed by “Fortune 500 enterprises, startups, academics, and technology vendors” to establish standard practices for the use of the platform/currency hybrid

“at the speed of business.”

You may shy away from joining speculators on the ups and downs of the cryptocurrency markets. However, there are a few strong cases for investment.

Here are three reasons to consider investing in cryptocurrency:

Bitcoin is experiencing massive growth

By far the most popular digital currency is the progenitor of Blockchain technology. Bitcoin owns the lion’s share of the emerging market. Its trading volume is much larger than any other competing currency and its valuation is many times more than the second cryptocurrency of choice, Ethereum. Wider adoption and regular mainstream coverage have elevated Bitcoin from an intriguing security experiment to a possible real-world asset. Additionally, Bitcoin’s exponential growth may portend good things for Blockchain currency in general. After a few major cases of theft for both Bitcoin and Ethereum, trust in the currency seems to be rebounding. Some believe the cryptocurrency is a bubble about to burst, but contentious political and economic conditions could push the price up even further.

Ethereum is gaining traction

Ethereum is the silver to Bitcoin’s gold.

Although it currently sits at under $100 a unit, it’s the most viable alternative to the dominant cryptocurrency. In fact, the competing form of cash was crafted by one of Bitcoin’s co-founders.

Ethereum is both a platform that allows for the creation of decentralized applications and a currency. The currency, Ether, fuels the platform. Its incorporation of smart contracts, which allow for anonymous agreements on the Blockchain, spawned the DAO (decentralized autonomous organization). The currency is more flexible for developers and has attracted major tech players, such as Intel and Microsoft.

It may see friendly regulation

The anonymity and lack of oversight concomitant with decentralized currency create opportunities for abuse. Certain alternative cryptocurrencies (altcoins), ones that enforce private transactions and anonymous transfers, such as Zcash and Monero, have been used extensively by criminal organizations. Although altcoins like Monero have increased in value due to acceptance from darknet users, this illicit usage of cryptocurrency has dealt damage to overall adoption rates.

Thankfully, we may see tighter regulations. Ethereum famously experienced a massive theft of $53 mln in Ether due to an exploit in a smart contract. Theoretically, the Ethereum Blockchain is immutable. The community voted to override this “immutability” in order to return stolen funds. Further, in 2013, a representative for the Bitcoin Foundation told US regulators that they would be open to transparent rulemaking. According to MarketWatch, digital currency advocates are pushing for

more regulation.

With recent interests from Japan and Russia to legitimize Bitcoin, these rules and regulations could help further cryptocurrency as a legitimate finance asset.

Diversify

Blockchain technology has the capability to change everything. The currencies running on the distributed ledger model could revolutionize how we interact with all forms of liquidity. While it is unlikely that fiat currency will be subsumed or overtaken by the digital mint, it’s quite possible that these currencies will see greater integration with our current systems.

At the very least, cryptocurrency is seeing a meteoric rise in the short-term. What the future holds for digital currency is uncertain. Currently, there is a cautious sort of endorsement for Bitcoin and Ethereum. Some speculators are pouring their cash into speedier alternatives, such as Litecoin and Dash. Still, most remain hesitant about moving their assets into an unbacked,

unregulated currency.

Although the Bitcoin ETF was recently shot down by the SEC, there is still plenty of reason to diversify your portfolio with a small investment in decentralized digital currency. As time has worn on, cryptocurrency has steadily risen in price and has experienced wider adoption.

To be sure, there has also been a great deal of volatility concomitant with Bitcoin’s rise. Valuation specialists continue to have trouble pinpointing the exact value of the currency itself and sentiment can vary wildly. Still, market capitalizations continue to grow. If you are able to steel yourself against booms and busts, you may profit from cautious investment. Continue to do your due diligence. If you remain uncertain, consider consulting a financial analyst. Remember to monitor updates, vigilantly investigating changes in sentiment. As always, be prepared to lose any amount you put into a speculative investment. Dedicating yourself to mindful investing will undoubtedly lead to the best result – especially in a market as volatile as the cryptocurrency market.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member

This Might Be The Key Reason Behind Bitcoin, Altcoin Price Surge

This Might Be The Key Reason Behind Bitcoin, Altcoin Price Surge

    

The first two-quarters of the year 2017

have seen the crypto industry experience a massive growth in awareness and adoption. From a perspective of economics, the high demand for Blockchain products, whether for preliminary investigations or systematic adoption has automatically generated an influx of capital which consequently reflects the value of the tokens of these Blockchains. The growing Blockchain partnerships offers an explanation for the significant increase in market capitalization of various cryptocurrencies and the consequent surge in Bitcoin price and several top altcoins.

Partnership is key to adoption

One of the major ways being observed for the enhancement and adoption of the Blockchain technology is through partnerships with existing conventional companies. Recently, Ripple experienced a significant surge in value and market capitalization. This is perceived to be as a result of the establishment of a collaborative project amongst banks in the Japanese Consortium for cross-border and domestic payments. Another example of partnerships that have significantly impacted on the market capitalization and overall value of the Blockchain technology is the implementation of a partnership-based strategy by Ethereum with the launch of the Enterprise Ethereum Alliance earlier this year. A partnership which attracts large-scale conglomerates like JPMorgan.

Another emerging collaboration

With several more partnerships expected, PwC Greater China Chairman, Raymund Chao believes that such partnerships are essential for robust execution in the present day business environment.

Chao says:

“Embracing advanced technology for growth becomes the top priority for many business sectors. Innovative applications and solutions could improve the effectiveness of supply chain, brand reputation, and even customer experience.”

Chao’s comment comes in the event of yet another partnership within the Blockchain industry. A partnership that sees business solutions company, PwC make its first Blockchain investment by adopting BitSE’s VeChain, a Blockchain-based anti-counterfeit and supply chain company out of China, with the aim of accelerating Blockchain adoption in Hong Kong and Southeast Asia.

More partnerships to come

The impact of Blockchain adoption through partnerships by conventional entities has become very significant. As the industry grows and tending towards reasonable global adoption, more partnerships are expected. The direct consequence of such development is increased demand for the technology, which directly implies a surge in market capitalization and subsequent rise in the value of associated cryptocurrencies.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member

Ethereum Classic Soars Along With ByteCoin, Pulled By Ethereum Price

Ethereum Classic Soars Along With ByteCoin,
Pulled By Ethereum Price

    

Wonders shall never end in Cryptoland!

On Sunday Cointelegraph predicted that it is going to be hot at the top 10 on CoinMarketCap this week. Truly less than 24 hours, on the early mornings on Monday, Ethereum Classic flew so much to make an upward adjustment of 31.46 percent.

ETC conquers Dash

In the process, ETC knocked down Dash to take over as the sixth most valuable cryptocurrency in the world. Nothing surprises anyone anymore in this ecosystem when it comes to the growth of altcoin. Just when everyone thought the battle between Dash and Ethereum Classic is over and that Dash has conquered, the latter has called it a bluff. This brings ETC's market capitalization to almost $900 mln and a market price of $9.72. The gap between it and the pacesetter of decentralized community governance is over $170 mln and even two steps behind.

A couple of weeks ago Cointelegraph spoke to Carlo Vicari of Ethereum Classic about its current impressive growth and he was really optimist of the future. He revealed how the Ethereum Classic community is bulging with newcomers. Looks like ETC is gunning for the top to get off his senior brother, Ethereum out of the way, even though it looks unfeasible at the interim. But then again, altcoin growth is like we are in wonderland.

Ethereum takes back number two

Moreso in a classic move Ethereum has regained the number two position from Ripple deepening the gap between them to more than $3 bln. It was with such great improvement of over 36 percentage point of growth. Its market price is now an admirable $174.81. As Cointelegraph predicted, the battle between the two is not yet over, and this was informed by how the two are all well-patronised utility. Whether Ripple can make another come back to the number two spot is just another interesting trend to be on the look out for in this space.

Bytecoin is biting

Yet still, the most intriguing development is Bytecoin that was firmly rooted on the tenth rank rising all of a sudden to the seventh position overnight. It made a casualty of Dash and Stellar Lumens and is now behind Ethereum Classic. On Sunday Cointelegraph asked whether Bytecoin has come to the elite echelons to stay or just one of those flash in a pan you see with altcoin. It appears they are proving it is not a fluke at all. The adjustment is unbelievably impressive! A 61.76 percent gain to knock out two strong cryptos tells you they mean business. Anyway, it doesn't look well for Monero at this stage. It's now sitting at number 10 with Dogecoin barking to push it away. For a few months now Cointelegraph has been referring to it as ‘gradually declining' Monero.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member

Bitcoin Leads Cryptocurrencies All-Time Highs Across Board, Scaling Remains Issue

Bitcoin Leads Cryptocurrencies
All-Time Highs Across Board, Scaling Remains Issue

    

Cryptocurrencies across the board have surged

in the past 24 hours to see many reach new all-time highs. The unprecedented rise, which will like fuel speculation of bubble-like behavior, saw Bitcoin $2,400, Ethereum breaks $200 and Litecoin challenge previous highs. The top 10 cryptocurrencies all posted gains in the run-up to press time Wednesday according to data from Coinmarketcap. Further down the charts, other huge movers came out, including a 54 percent rise for Stratis and 68 percent for the Lisk Foundation’s LSK token. At the same time, it is becoming more and more difficult to determine the underlying cause for the continued market buoyancy in both Bitcoin and altcoins.

Talk of a final SegWit deal for Bitcoin may have fueled its rise, yet with details have yet to be ironed out, talk is turning to U-turns from certain members of a group originally plugged by Barry Silbert as agreeing to implement SegWit by September. SegWit is the major preoccupation of the Bitcoin community on social media meanwhile, with price celebrations eschewed in favor of debate about the strength of Silbert’s plan and likely saboteurs. Price-wise, even commentators such as Vinny Lingham have implied the next significant barrier will not be until Bitcoin is within striking distance of $5,000.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member

Not Right Time to Regulate Bitcoin: American Institute For Economic Research

Not Right Time to Regulate Bitcoin: American Institute For Economic Research

    

“Now Is Not the Right Time to Regulate Bitcoin”

The American Institute For Economic Research (AIER) senior research fellow Max Gulker argued in a recent column entitled “Now Is Not the Right Time to Regulate Bitcoin” that it is not a practical approach towards technological innovation to overregulate Bitcoin and digital currencies at the moment. Bitcoin and other cryptocurrencies such as Ethereum, Ripple, Litecoin, Ethereum Classic and NEM are all at its early stage in development. Bitcoin is yet to deal with its scaling issues that have substantially increased transaction fees for users. Bitcoin fee estimation service providers including the 21 Inc Bitcoin Fees are recommending users a $2 fee or a 420 satoshis per byte fee to have transactions verified and confirmed by miners relatively fast.

Ethereum and other cryptocurrencies and Blockchain networks are also dealing with their own scaling issues and developing infrastructures for their growing user base and clientele. Ethereum and Ripple, in particular, are in partnership with some of the world’s largest financial institutions and conglomerates to utilize smart contracts to settle transactions in an autonomous, transparent and secure manner. Hence, at this critical juncture, it would be significantly impractical for governments to step in and overregulate the cryptocurrency sector. Minimal and efficient regulatory frameworks have helped the global cryptocurrency market to mature. For instance, Japan’s legalization of Bitcoin led to an explosive growth in demand for Bitcoin and other cryptocurrencies like Ripple and NEM.

Regulatory frameworks damaging to startups

However, Gulker explained that regulatory frameworks such as New York’s BitLicense can be damaging to startups both financially and in the technical sense. As regulatory frameworks like the NY BitLicense require startups to pay a large licensing fee and keep tight records of their users, they create difficult ecosystems for both small and large-scale startups. Even startups that have millions of users and that have secured millions of early-stage funding such as Shapeshift have suspended services in New York due to impractical regulations. Emphasizing the damage over-regulation from governments can inflict on startups and the global cryptocurrency industry,

Gulker wrote:

”Cryptocurrencies are still in a very early period of innovation and adoption. It would be a shame for a disproportionate amount of that innovative effort to go toward satisfying regulators’ demands rather than users’ wants and needs. The true risk lies in over-regulating cryptocurrencies now.”

Ultimately, Gulker noted that governments should take a wait-and-see approach instead and implement the practical yet minimal regulation on the Bitcoin and cryptocurrency industry. When the technology, market and industry start to evolve, governments can step in to regulate the market for general consumers and investors. “Those who believe in the benevolent power of such regulation should remember the inevitable rent-seeking behavior to which it leads, where businesses lobby government for favorable regulation. So it might be best for regulators to take a wait-and-see approach,” added Gulker.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member

Should Tax on Bitcoin Be Eliminated? The Case of South Africa

Should Tax on Bitcoin Be Eliminated? The Case of South Africa

    

One of the most widely utilized trading platforms

Bitcoin exchanges in South Africa including Luno, one of the most widely utilized trading platforms in the country, stated that Bitcoin earnings are taxable in South Africa. When trading, the exchange suggested users consult registered tax professionals to ensure that they are compliant with South African regulations.

Should the tax on Bitcoin be eliminated?

Most countries that have fully adopted and regulated Bitcoin such as Japan have eliminated the tax on Bitcoin trading. On April 1, Japan officially declared Bitcoin’s exemption from consumption tax and eliminated the possibility of double taxation on trading. Recently, the Australian government also exempted Bitcoin trading from goods and services tax (GST). “The Government has released a consultation paper on changing the GST treatment of digital currencies. This change will ensure that consumers are no longer ‘double taxed’ when using digital currencies to buy goods and services already subject to GST,” read the 2016 – 17 Budget Report of the Australian government.

In South Africa, however, Bitcoin trading is subjected to general principles of South African tax law. The South African Revenue Service stated that transactions or speculation in Bitcoin are subject to tax and should be taxed accordingly. The government institution further emphasized that it is the responsibility of both citizens and residents of South Africa to report relevant details to the South African Revenue Service. Former BitX Product Design Director and Blockchain investor Simon Dingle also stated that Bitcoin trading in South Africa could trigger a capital gains event and encouraged traders and investors to consult tax professionals before trading on South African exchanges.

“It may trigger a capital gains event, or could qualify as income for active traders. All assets are treated equally in terms of tax,” said Dingle. More to that, income received in Bitcoin and other digital currencies are taxed as conventional income tax. It is still unknown whether double taxation applies and, as a result, if users are subject to both income tax and capital gains tax. Additionally, Luno Head of Growth Werner van Rooyen stated that various factors could impact taxation on Bitcoin transactions and trading depending on the situation of users.

Rooyen stated:

”There are various factors that could impact taxes an individual owes to the tax authorities, The short answer is that all income is taxable in South Africa and it is the responsibility of individuals to remain tax compliant.”

Regulations and taxation policies

The Australian Treasury changed its regulations and taxation policies on Bitcoin after seeing a sharp decline in interest in Bitcoin and other digital currencies in the country. Exchanges that used to operate in the country have left Australia to other Bitcoin-friendly regions such as Singapore and Hong Kong. For that reason, the Australian Treasury removed the double taxation of Bitcoin.

As its report read:

“For digital currency, the current treatment under the GST means that consumers are ‘double taxed’ when using digital currency to purchase anything already subject to GST. The Government recognises that this treatment may be preventing the use of digital currencies and hindering their further development.”

Aggressive taxation policies on Bitcoin could also result in a delayed andlimited growth for the South African exchange market and Bitcoin industry. The South African government must consider the effect of double taxation and clarify the taxation policies that apply to Bitcoin and digital currencies.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member

Cryptocurrency Trading Volume Hits $4.3 Bln, Nears Stock Exchange Volume

Cryptocurrency Trading Volume Hits $4.3 Bln, Nears Stock Exchange Volume

    

The cryptocurrency trading volume hit $4.3 bln. Bitcoin

On May 25, the cryptocurrency trading volume hit $4.3 bln. Bitcoin, Ethereum, Ripple, Ethereum Classic, Litecoin and NEM drove the cryptocurrency trading volume to new all-time highs. Bitcoin developer and entrepreneur Jimmy Song compared the cryptocurrency trading volume to the exchange volume of major stock exchanges such as NASDAQ. Although the cryptocurrency market’s trading volume is only a fraction of major stock exchanges such as NASDAQ, it is nearing the exchange volume of smaller stock exchanges such as Thailand and Australian stock exchanges.

In order for the cryptocurrency market to near the trading volumes of major stock exchanges, particularly the 16 stock exchanges in the $1 Trillion Dollar Club, the cryptocurrency market will need to achieve a multi-trillion dollar market cap. Currently, the market cap of the cryptocurrency market is $71 bln.

Cryptocurrency investments

Investors and traders are investing in the cryptocurrency market for a variety of reasons. Some have invested in Ethereum because of its successful partnership strategy demonstrated by the Enterprise Ethereum Alliance. Others have invested in Ripple, the third largest crypto asset in the cryptocurrency market, due to its partnerships with the Japan Bank Consortium and leading financial institutions.

A large number of both casual and institutional investors have invested in Bitcoin as a safe haven asset to avoid potential economic uncertainty and financial instability. Some investment firms including Fidelity Investments are actively investigating the potential of Bitcoin and Ethereum by mining the two digital currencies and testing two-layer solutions such as Lightning and Bitcoin-based micropayments solution. If the demand toward cryptocurrencies continue to increase and investors begin to perceive cryptocurrencies as alternatives to existing financial systems, the cryptocurrency market could surpass the growth, market cap and trading volumes of major stock exchanges in the future.

A phenomenal method of raising funds

Furthermore, similar to the initial public offerings (IPOs) of public companies, Blockchain startups and commercial companies such as Kik have been launching initial coin offerings (ICOs) to sell tokens in a transparent and decentralized manner. Although analysts have raised concerns over the legality of ICOs and potential response from the US Securities and Exchange Commission, ICO, in theory, is a phenomenal method of raising funds for startups without intermediaries. More importantly, ICOs enable anyone within the community to participate in the investment, providing opportunities for small-scale investors.

Startups that raise or complete successful ICOs often have their tokens listed on cryptocurrency market data providers such as CoinMarketcap and on exchanges. Most recently, Gnosis, a Blockchain-based prediction market platform, raised a multi-million dollar funding round in an ICO at a $300 mln valuation. The Gnosis token was listed on major US-based Bitcoin exchange Kraken and within a month, it became the seventeenth largest crypto asset in the market. In a sense, the cryptocurrency market and the concept of ICO represents similar qualities and characteristics of stock exchanges – a decentralized, transparent and autonomous stock exchange.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member

South Korea is Becoming Bitcoin and Ethereum Powerhouse

South Korea is Becoming Bitcoin and Ethereum Powerhouse

    

South Korea is becoming a Bitcoin and Ethereum powerhouse

in terms of trading volumes, liquidity and activity. Over the past few months, South Korea’s three largest digital currency exchanges Bithumb, Korbit and Coinone have added support for Ethereum traders by integrating Ether. In a relatively short period of time, South Korea has become the largest Ethereum exchange market with a $335 mln daily trading volume and 38 percent market share. In fact, the ETH/KRW pair processes more trades than the ETH/BTC pair, which used to account for over 50 percent of all Ethereum trading.

The largest Bitcoin exchange markets in the world

South Korea has also become one of the largest Bitcoin exchange markets in the world. Although South Korea is currently the fourth largest Bitcoin exchange market behind the US, China and Japan, a month ago, its trading volume and market share was larger than China and Japan and secured its spot as the second-largest Bitcoin exchange market for awhile. South Korean investors within the cryptocurrency market are very easily moved and influenced by the media. Ethereum’s recent Enterprise Ethereum Alliance deals with large conglomerates such as Toyota and JPMorgan have further validated the value of Ethereum to more local investors and have shifted the trend from Bitcoin to Ethereum.

Eyes set on altcoin

More importantly, because Bitcoin has become a conservative asset amongst other cryptocurrencies, investors in South Korea have started to look into altcoins such as Ethereum and Ripple that are supported by local exchanges. Most South Korean exchanges are funded by multi-billion dollar corporations within the country. Korbit, South Korea’s second-largest exchange, is invested by SK Telecom, the largest telecommunications company in the country. Therefore, when exchanges add support for cryptocurrencies such as Ethereum and Ripple, immediately, investors dive into altcoins. Particularly, investors that believe they missed Bitcoin’s rally invest in altcoins for large short and mid-term gains.

The demand toward Bitcoin has increased to the point where there always exists a huge arbitrage opportunity for overseas traders. Bitcoin is being traded in South Korea with a premium price of $2,800. That is a 21 percent premium over the global average price and other major markets such as the US. While it is still possible to purchase Bitcoin outside of South Korea with other options such as credit cards to avoid premium rates, it is difficult to trade large amounts of Bitcoin without being flagged by anti-money laundering systems. If the current growth rate of the South Korean Bitcoin and Ethereum exchange markets can be sustained over the next few months, South Korea could become a powerhouse for both the Bitcoin and Ethereum markets.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member

Altcoin Gulden Set To Implement PoW² In July: Leading Developer

 

Altcoin Gulden Set To Implement
PoW² In July:
Leading Developer

    

Gulden is set to implement Proof of Work 2.0

also known as PoW² latest by July this year. The digital cryptocurrency that has tagged itself as user-driven insists this new technology will tremendously enhance its security and provide economic incentives for holders. In a chat with Cointelegraph, Gulden Lead Dev, Malcolm Macleod who is the mastermind of PoW², says what the technology is going to do to advance it to the crypto space.

Limitations

He intimated that his outfit has taken a long hard look at various usability issues that stand in the way of their current goals. He also identified several limitations of current Blockchain systems that repeatedly stick out as key usability issues that need to be solved. According to Macleod, they include issues like erratic block times, slow transaction confirmations, and the risk of double spends among others.

He says:

"After looking at these problems holistically, we have come up with a solution that not only solves them but also drastically improves our overall Blockchain security and has other positive effects as well, and this is the system we call PoW²."

Malcolm disclosed that the system works not only by building on top of the existing PoW system but adding onto it a concept we call 'witnessing' which involves a deterministic random winner signing each block as it comes in. "In order to participate as a witness users must lock coins in a special address for a period of time (of their choosing) between one month and three years," he added.

Solution

Macleod, the Southern African Based Blockchain Developer, explained that PoW² brings a massive increase in Blockchain security. It is immune to a standard greater than 50 percent attack that would be possible on PoW, with the equivalent attack on PoW² requiring not only 61 percent of hash power but also 61 percent of all coins and still has a lower chance of success.

He explains:

"At the same time, PoW² remains immune to attacks like grinding that regular PoS coins would suffer from. There are less confirms required by users for their transactions. Instead of the standard seven confirms required for Bitcoin (or more for other coins) the security properties of PoW² allow for users to be sure of consensus much faster, and they need to wait only for one or two confirmations.”

Dichotomy

When Cointelegraph inquires about the difference between PoW² and the previous version, Malcolm steered out that it solves the 'empty block' issue which is very important for scalability, and the transaction backlogs with Bitcoin network for instance with miners mining empty blocks, which is really bad for overall transaction capacity. He is of the opinion that PoW² solves this issue for 99.9 percent of cases.

"PoW² helps to keep the PoW miners on the network less centralized, and completely removes from them the ability to censor transactions, something that is quite possibly going to be a big issue for PoW coins going forward," he said. “With Bitcoin, we now see a situation where miners get a disproportionate say in decisions (like SegWit activation). With PoW² those who actually hold currency for the long term get more say in forks and therefore the control is placed in the hands of people who actually have a vested interest in the currencies long term health and not just short-term profits."

Challenges

In response to what limitations and Challenges PoW² has, Jason van Heerden, a Gulden Team member, emphasized it is when it comes to making it possible for secure one-confirmation transactions which will lead to zero-confirmation transactions in the future but the solution to it will also be out soon. "No real limitations besides the code base becoming more complex to manage," Jason stressed. Curiously, on whether you need to permanently keep your wallet open to act as a Witness, Jason said yes. The wallet can remain locked/encrypted during the process so it remains secure. It is likely that cloud and/or dedicated hardware based solutions will become available to assist people with this," he revealed.

Jason also disclosed the concept has been worked on for over a year now already, with the whitepaper and internal feasibility tests ongoing. Moreover, he explained the release will include many other bug fixes and codebase improvements besides PoW² so it is important that proper testing is done. However, it is their believe it is going to be out and operating on the Gulden network by July.

Expert opinion on PoW²

JuicyG of Coinchat.Club thinks Gulden seems to be using a hybrid PoW/PoS and calling it PoW² isn't really accurate. In his evaluation, other projects like Ethereum or Ethereum Classic are working towards adding a hybrid PoW/PoS solution.

He argues:

"As a matter of truth, 80 percent of their block reward seems to be going to miners, while 20 percent is reserved for wallet staking. People have to run the wallets on their computers for it to work. They didn't set up a system yet that would allow one to use a VPS to host the node, which is not ideal if you care about 24/7 uptime. Few people will let their computers on 27/4. This is something they've admitted themselves in their FAQ." Cointelegraph asked JuicyG it appears that is some of the solutions PoW² provides, but he was adamant. "It doesn't strike me as very innovative, to be honest, and also, they mention zero confirmation transactions but this is something that doesn't exist yet and will come in Version 2.0.," he differed.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk – Markethive Founding Member