Tag Archives: InboundMarketing

80% of all Bitcoins Will Have Been Mined In a year From now

80% of all Bitcoins Will Have Been Mined In a year From now

The World Bitcoin Mining

is in for quite a reality shock in about a year from now. As most people are well aware of, the amount of bitcoins being mined every day is much compared to a few years ago. What is even more intriguing is how the vast majority of BTC has been mined already. In January of 2018, 80% of all 21 million BTC will be mined and brought into circulation. A significant milestone that should not be overlooked by any means.

Inching Closer To 80% Of All Bitcoins

It is quite interesting to think about how far bitcoin has come since its inception. With a  hard limit of 21 million BTC to be generated by 2140, a lot of people assume there are still a lot of coins to be mined for the next few years. While that is true up to a certain extent, we are getting closer to 80% of the finite supply being brought into circulation already. Said milestone will take place roughly 365 days from now.

It remains a bit unclear as to what this will mean for the price per individual BTC, though. Asa mining becomes more difficult and less profitable unless continuous new investments take place, the price per existing bitcoin should go up in value. Moreover, with “only” 4.2 million coins to be generated after January 2018 = over the course of nearly 122 years – the demand for bitcoin should increase as well. However, neither of these factors are a given, as the cryptocurrency market does not operate like more traditional models.

At the same time, the 80% milestone could force some miners to shut down their operations. We have seen some major mining difficulty spikes over the past few weeks, and that trend will continue for quite some time. A higher mining difficulty requires more hash power and electricity to mine the same amount of bitcoin. For a lot of miners, January 2018 may become a good time to call it quits once and for all.

Should that happen, however, things will become even more intriguing. If there were fewer miners, it is expected the mining hardware manufacturers will take an even larger stake in the bitcoin mining process. Companies such as Bitmain and Bitfury have brought a lot of mining hardware online over the past few years. With more energy-efficient hardware still being developed, it is not unlikely a certain degree of centralization will occur in the mining world.

One of the lingering questions being asked aloud is whether or not we will ever see 100% of bitcoin’s entire supply be mined, to begin with. The final 5% could prove to be challenging, as the trade-off between costs and earnings will make it seem far less attractive to do so. It will take a very long time to mine the 21st million BTC, that much is already a given at this point. In fact, most people alive today in the bitcoin world will never that happen.

The coming year could become a very important one for Bitcoin as a whole. Albeit there are no guarantees or certainties, once 80% of the supply is mined, things will change eventually. Whether that will be in positive or negative fashion, remains unknown at this point. We live in very exciting times, especially when one has grown fond of the concept of bitcoin and cryptocurrency.

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

Cryptocurrency Versatility Creates New Opportunities

Cryptocurrency Versatility Creates New Opportunities

Crypto Coins

Over the last few years, the Cryptocurrency industry has been gaining popularity, and for a good reason. With the complexity that goes into making physical dollars, it’s clear now why people are opting to print a new form of currency. Making a digital currency is quite easier for someone with basic coding skills. Most are turning to the internet to gain ground and understand its use and value. Before, the concept was unfamiliar and scary just like the credit card some years back.

You might have come across the terms Bitcoin, Litecoin, and Ether. These are cryptocurrencies that use the Blockchain Technology to ensure this currency and technology is safe. Here we look at the some of the new opportunities created by cryptocurrency versatility in different fields. But before that, let’s look at the basics.

What is Cryptocurrency?

A cryptocurrency is an encrypted digital currency that is created using advanced encryption techniques commonly known as cryptography. The concept became a reality upon the creation of Bitcoin in 2009. It captured the attention of significant investors in April 2013 when it recorded a price of $266 per bitcoin. So, will the currency eventually unseat the ruling currencies such as dollars and euros? The answer lies with the Bitcoin. That said, what are the new opportunities being created by the cryptocurrency? Find out.

Improvement in education

According to Gigaom reports, university students can now receive bitcoin once they enroll in school, and some universities are even accepting the currency as a form of payment for tuition. Dan Elitzer, the President of the MIT Bitcoin Club, and Jeremy Rubin, a computer scientist at MIT, successfully raised about half a million dollars for the enrollment of more than four thousand students worldwide in tech institutions.

The team together with the bitcoin community managed to provide students a chance to develop their own bitcoin wallets. This seems like a clever plan judging from the recent advancements in Bitcoin where they have developed the new Xapo Wallet. Today technology has enabled students to access different services including essay services and now cryptocurrency. Providing college students with access to bitcoin is a great step in cryptocurrency especially since universities are now accepting alternative currencies such as Bitcoin as payment for tuition.

Entrepreneurial innovation

The improved growth in the use of cryptocurrency leads to entrepreneurial innovation and it is said to foster growth in traditional banking infrastructure. Once the infrastructure is built and there is mass distribution of the currency, new businesses can build financial services without having to invest in expensive infrastructure. They just have to build applications and supportive services aside from the cryptocurrency system and they conduct their business without building a data center, huge hardware, and an IT department. The ability of an entrepreneur to access a source of payment method has fueled innovations in the financial services. These services are beneficial to the constituencies and areas that are underserved by the traditional banking providers.

Facilitates establishment of custom designed currencies

Cryptocurrencies are the latest technological advancements that have enabled groups to create custom designed currencies. Today we see banks and other institutions working hard to establish their digital currencies and this is a new chance to experiment new technology. Bitcoin has already set ground and proven to be quite dynamic and resilient amongst other currencies. It has undergone massive criticism but it has proven it’s powerful on the global perspective. Being an example of a successful digital currency, it is completely public and can be used in peer-to-peer transactions. It is a global financial utility that is accessible to anyone provided you’re connected to the internet.

Those who say that Bitcoin and Ethereum may become irrelevant may be surprised. Cryptocurrencies are high-grade financial tools that are made for legitimate and exciting function with a sense of global financial services that bypasses the infrastructure of traditional banking. Some experts even suggest that blockchain payment systems may beat the mighty U.S. Automated House financial transactions system come 2020.

With the technological advancement that is being experienced now, it is not a surprise to find that the cryptocurrency usage may accelerate to greater heights. The blockchain technology is expected to form a great part of the coming internet generation with massive transformation in commerce and overall structure of corporations and many other institutions across the globe. Be ready for this radical transformation. It’s worth checking out.

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

What you need to know about mining Bitcoin in South Africa

What you need to know about mining Bitcoin in South Africa

  

What is Bitcoin mining?

Bitcoin miners use computing power to add transaction records to the blockchain, which is a public ledger of transactions. Miners earn a certain number of Bitcoins for the work they contribute to this process and are paid a transaction fee by users sending transactions. The process of mining and adding a new block to the blockchain comprises the following steps:

  1. Verify that the transaction is valid.
  2. Compile valid transactions in a block.
  3. Insert the header of the most recent block into the new block as a hash.
  4. Solve the proof of work problem.
  5. When a solution is discovered, the new block is added to the blockchain.

The proof of work is designed to require a large amount of computational power, as this prevents the public ledger of transactions from being tampered with and controls the rate of new Bitcoins being introduced. The proof of work difficulty is updated regularly in order to maintain a controlled flow of new Bitcoins and improve the security of the system.

  

Mining Hardware

During the infancy of Bitcoin mining, many people used desktop processors to mine Bitcoin. However, as the difficulty continued to rise with the popularity of the cryptocurrency, specialized mining hardware was developed in order for miners to remain competitive. These days, mining Bitcoin requires a large amount of investment and work to make a profit, as there are many mining farms around the world.

While this increases the security of the system, it means that using your graphics card to mine Bitcoins in your spare time is no longer a viable solution for most miners. Most serious Bitcoin miners use hardware designed to mine Bitcoin. The efficiency of these devices is measured in hashes per second and their price can vary depending on performance levels.High-end hardware also draws a large amount of power and can be prohibitively expensive for casual Bitcoin miners.

Below are several Bitcoin mining hardware solutions available in South Africa.

Bitcoin Mining Hardware Pricing
Bitcoin Miner Hashes per second Power Consumption Price
Avalon 721 + PSU 6.0TH/s 850-1000W R21,799
Avalon 741 + PSU 7.3TH/s 1150W R24,999
S9 Antminer + PSU 11-14TH/s 1372W R37,580
Avalon 741 5 Unit Farm + PSU 37TH/s 5750W R119,999

  

Software and Bitcoin Wallet

After purchasing the required mining hardware, you will need to download Bitcoin mining software. This software connects you to the blockchain and ensures you are in consensus with the official Bitcoin network. If you are mining in a pool with other miners, data requirements are relatively small. If you are mining by yourself, you will need to download the official Bitcore client to synchronize with the blockchain. Bitcoin mining software is freely available online, with the most popular using a simple command line interface.

Below are a few popular Bitcoin mining programs:

  • EasyMiner
  • MinePeon
  • CG Miner
  • BFG Miner

Miners also need a Bitcoin wallet to store their earnings. There are a number of Bitcoin wallets available online, but it is generally recommended that users download a wallet which allows them to hold their own security keys instead of an online hosting solution.

   Saving keyboard money

Saving keyboard money

Additional options

Instead of purchasing physical hardware and using your own resources to mine Bitcoin, some miners opt to purchase cloud mining contracts. Cloud mining involves renting an amount of processing power from a service provider and earning Bitcoin relative to the amount of processing power purchased. There have been many scams involving cloud mining contracts, and there is no guarantee of security when using these services.

Miners can also choose to mine different cryptocurrencies using different blockchains, such as Ethereum. Each of these currencies has its own advantages and disadvantages, with some catering more to individual miners or offering reduced block time.

  

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

Bitcoin Price Growth, Global Adoption Depend on Japan’s Confidence in Bitcoin

Bitcoin Price Growth, Global Adoption Depend on Japan’s Confidence in Bitcoin

  

Bitcoin Price Growth, Global Adoption Depend on Japan’s Confidence in Bitcoin

As long as Japan does not fail in what seems to be an effort that is making Bitcoin bigger, the world's top digital currency would always be a success. One latest example is the adoption of the AML/KYC rules for Bitcoin exchanges in the country. Like China, Japan is now impacting meaningfully on the Bitcoin market whenever the third largest economy in the world comes out with a move that causes a change.

Bitcoin price affected

With the recent development in which Japan recognized Bitcoin as a legal method of payment starting Saturday, April 1, the Bitcoin price has seen a steady climb over the $1100 range by the start of Monday. The recovery from the dip where the Bitcoin price had been over a week ago when the deadlock over the scalability issue had heightened has been attributed to a growth in Bitcoin demand from Japanese consumers after the government passed a law which basically says officially that Bitcoin users will not be taxed directly.

Rather, it brings up the issue of AML/KYC which caused a heated debate. Some users are in favor of it preferring exchanges operating legally so that they can be law-abiding, pay taxes on behalf of users and guarantee some form of protection for users’ money.

New law

Japan’s new law has been on debate for months following the collapse of the Mt. Gox Bitcoin exchange. The law’s passing brings Bitcoin exchanges under Anti-Money Laundering/Know Your Customer rules as it is the case in China. The exercise in verification will expectedly increase trust in Bitcoin and probably forestall a recurrence of the Mt. Gox case.

Coincheck's Kagayaki Kawabata told Cointelegraph:

"While market cap and usage of cryptocurrency is scaling significantly in past few years, Bitcoin and cryptocurrencies are something that can't be ignored. The Mt. Gox incident took place in Tokyo. This experience I think has made Japan decided to regulate them in order to protect the customers. I think other countries will follow Japan if this new regulation works out."

Tax issues

The AML/KYC process will also serve as a link between the government and Bitcoin which is what many people believe is still missing for the ecosystem to grow into a regulated market. For Bitsquare's Ken Shishido, the development is a result of years of industry effort in lobbying policy makers and not necessarily the government taking a proactive approach nor wanting to make Bitcoin bigger and better.

Tax implication is not finalized yet but it is a huge deal that consumption tax is now officially exempted, he adds. From China to Japan and other countries, it is now clearer that governments are on the way of recognizing Bitcoin as a financial instrument. But to make the digital currency go mainstream everyday users need to support it as a common practice.

Why Japan Matters

Japan does not seem at all worried by the general attitude of some countries to digital currencies like Bitcoin. The country’s level of confidence in Bitcoin is overwhelming despite the negative history it has had with the digital currency. Based on this level of trust and interest in the currency, the success of the ongoing experimentation will help show how possible legislations can work with Bitcoin.

It will go a very long way to draw other countries that are still skeptical about Bitcoin into the fold as well be a good form of advertisement to the wider global community – especially governments. The legality of the state is always a boost for the justification of Bitcoin. For a big economy like Japan to trust Bitcoin as a payment method speaks volumes. It is a sign that it could be a significant tool that could bring advantages over sentiments that point to negativity.

Shishido says:

“Not sure other developed countries will follow suite anytime soon but maybe countries like Singapore, Hong Kong, Estonia, Switzerland and etc. If some countries do recognize it as a legal tender, it will be a game changer. Japan’s legal status is “currency-like property with consumption tax exemption. If one country recognizes it as a legal tender, all United Nations country will need to acknowledge, too.”

One other factor to note about Japan's impact on the Bitcoin price is that when it happens, the price increase tends to be usually real – it would correct at some point but not to its initial take-off point. Relatedly, one of the countries picking up on a similar move is Mexico which is working on the first draft of a fintech law that will make its central bank define the regulation that will apply to digital assets such as Bitcoin based on two criteria: widespread adoption of the public and the protocols, rules and mechanisms that allow their generation, identification, division and control.

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

The Big Three: How China, India, Japan Set Pace For Bitcoin

The Big Three: How China, India, Japan Set Pace For Bitcoin

   The Big Three: How China, India, Japan Set Pace For Bitcoin

The Recent behavior of Bitcoin

reveals that developmental events around certain nations make huge impacts on the cryptocurrency. The most significant among these nations are China, India and most recently, Japan. With the mainstream adoption of Bitcoin in Japan and the subsequent acceptance of the cryptocurrency by several stores across the Asian country, Bitcoin has responded by its most recent surge in price, rising significantly above the $1,200 mark in the process.

Strength in numbers

Whether positive or negative, news and events out of the aforementioned Asian giants are always well respected by Bitcoin as an entity and the community as a whole.

Michael Vogel, CEO of Netcoins, says:

“China and India represent a significant portion of the world's population and each has a rapidly growing middle and wealthy classes. Both of these countries are also experiencing turmoil with government imposed capital controls, so the importance of Bitcoin is much more apparent to its citizens as opposed to North America, for example.”

One of the major issues that have come up repeatedly within these Asian climes is the attempt of the government to regulate Bitcoin. Earlier in 2017, there were a few significant events and pronouncements by both the Chinese and Indian government concerning the use of Bitcoin and other cryptocurrencies.

The majority of Bitcoin users have seen these government interventions as events that could negatively affect the growth and development of Bitcoin. On the contrary, these efforts by governments to control the use of Bitcoin may be having a rather positive effect on the cryptocurrency.

Governments are indirectly working for Bitcoin

Simon Dixon, CEO of BnkToTheFuture.com, believes that governments are driving demand in Bitcoin whether they know it or not. He continues by exemplifying the developments in India, where the government's war on cash was an attempt to force bank adoption in India. Dixon notes that India has less trust for banks than many other nations so some are experimenting with Bitcoin instead.

In addition to this, Japan has chosen to regulate Bitcoin exchanges which mean traditional financial institutions are now able to offer Bitcoin to their clients bringing in more demand. China has decided to implant tougher regulations on Chinese exchanges driving a huge spike in the peer to peer Bitcoin market in China and eventually more trust in the exchanges when they allow withdrawals again.

Dixon says:

“What is clear is that no matter what the government does, it is driving more and more demand for the two Bitcoin markets – regulated Bitcoins through exchanges and unregulated peer to peer Bitcoin. All these approaches show the rest of the world that government action drives Bitcoin demand in many unintended ways.”

Japan is a pacesetter

Another important factor identified by Vogel which may be responsible for the Asian dominance in Bitcoin is the fact that Asian countries, Japan, in particular, have always been ahead of the curve with mainstream adoption of new technology. Cell phones, mobile gaming, and mobile payments all gained popularity in Asia years before Europe and the US. It seems that Bitcoin is following a similar trajectory.

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

These Investors Bought the Firm Behind Bitcoin’s Self-Proclaimed Inventor

These Investors Bought the Firm Behind Bitcoin’s Self-Proclaimed Inventor

  

A company built around the research of Craig Wright,

who has claimed to have invented the bitcoin cryptocurrency, has been sold to a private equity firm in a deal the company says is the biggest to date involving bitcoin's underlying blockchain technology. The deal swings the spotlight once again on to Wright, a 46-year-old computer scientist who is the cryptocurrency's most controversial figure. He hopes to remain central to the technology's future, telling Reuters the goal is to build bitcoin into a global "system with no ruler, no king."

"We will scale and grow bitcoin to become what it was envisioned to be," he said. "All I do is to help grow the use of bitcoin, and I want to see it in daily use by at least a billion people on-chain. We have the funds, the people and the technology to do this." According to a news release on Thursday, Malta-based High Tech Private Equity Fund SICAV bought nChain Holdings, "the world leader in blockchain-centric research and development." It put no value on the deal and did not mention Wright. Reuters previously identified nChain, formerly known as EITC Holdings, as Wright's vehicle for filing hundreds of bitcoin and blockchain-related patents.

U.K. records confirm that the target company—under both its EITC and nChain names—already filed more than 80 bitcoin and blockchain-related patents. A person close to the deal said $300 million had been invested in nChain, but it was not clear over what period of time. The Maltese fund did not respond to emails asking for comment.

Reuters reported last year that EITC planned to file hundreds of patents related to the blockchain, the distributed ledger technology that underpins cryptocurrencies like bitcoin. The financial industry and others are exploring its potential. The fund is managed by Liechtenstein-based Accuro Fund Solutions, part of Zurich-based Accuro Group. Accuro did not respond to an emailed request for comment.

DIVISIVE FIGURE

Wright remains a divisive figure in the bitcoin world. After failing to convince many in the bitcoin community that he was Satoshi Nakamoto, the pseudonymous founder of bitcoin, Wright retreated from view last year. Reuters reported last month that Wright was working with Calvin Ayre, a Canadian online gambling tycoon, to build a patent portfolio, though its purpose was not clear. Ayre was not immediately available for comment.

nChain said in an emailed response to questions from Reuters that neither Ayre nor Wright had a stake in it before or after the sale. It said the company previously acquired Wright's assets and intellectual property, and he now held the post of chief scientist. Although it was not possible to confirm Wright's identity as Nakamoto, a Reuters investigation found he was deeply involved in the early development of bitcoin and had told Australian tax officials he possessed more than 1 million bitcoin—worth $1.2 billion at the current exchange rate.

Patent lawyers have noted that open-source technologies like bitcoin are not easy to patent, and even if patents are approved, they are not always easy to defend. Thursday's announcement is the first time nChain has publicly acknowledged it is filing patents. Without confirming how many bitcoins he owns, Wright told Reuters he would never "dump bitcoin." "I will sell when I do this for goods on a daily basis, or I will go down with it. Past the basics of my family's well-being, all I have is dedicated to building the systems and institutions needed to make bitcoin successful globally," he said.

The news release also shed light on what Wright and nChain might do with its patents. nChain this year "intends to make some of its intellectual property assets available to the blockchain community through open-source software and royalty-free licensing." It invited interested parties to register via email. nChain's patent filings, seen by Reuters, range from the storage of medical documents to Wi-Fi security. Investors have spent more than $1.5 billion on blockchain and bitcoin start-ups over the past four years, according to CB Insights, an Internet research company.

The company said it was also working on software tools and applications to support the growth of blockchain. These include a software to develop applications on the bitcoin blockchain, solutions for bitcoin blockchain scalability, inventions to improve security, on-chain scripting for smart contracts, and a decentralized trading platform that uses autonomous agents. The company also called for a neutral standards body to be set up to coordinate bitcoin's development.

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

Bitcoin bears ramp up bets virtual currency will fall

Bitcoin bears ramp up bets virtual currency will fall

Short interest on Bitfinex has surpassed long interest for the first time since February

  

Bets that the bitcoin price

will fall have surpassed bets that it will rise for the first time since February on one of the world’s largest digital currency exchanges, stoking contrarian speculation that the digital currency could be headed for a new all-time high.

Open short interest on Bitfinex surpassed long interest on Thursday for the first time since February. The last time shorts eclipsed longs, the bitcoin price gained nearly $300 over the following three weeks, rising from $993 on Feb 13 to an all-time high of $1,285. Bitfinex, a top digital currency exchange by trading volume, is also one of only a handful to allow customers to trade on margin.

–– ADVERTISEMENT ––
 

In financial markets,

short interest is sometimes viewed as a contrarian indicator because it leaves assets vulnerable to what’s known as a short squeeze. In a short squeeze, investors who bet against the asset are forced to buy it back to close out their positions at a loss, causing the price to move sharply in the other direction.

The buildup in shorts “proves that the bitcoin scaling debate isn’t over yet,” said Chris Dannen, a founding partner at Iterative Instinct, a small New York-based private-equity fund that trades crypto-assets. Dannen was referring to a rift in the bitcoin community over how to upgrade bitcoin’s software to allow the network to process transactions more quickly and efficiently.

That debate has quieted down in recent weeks as bitcoin miners have backed away from a controversial proposal called bitcoin unlimited that would’ve raised the limit on the amount of transaction data can be stored in each block of the bitcoin blockchain. Investors feared that, if support for the proposal passed a certain threshold, but fell short of unanimous adoption, it could split the network into two different coins.

Amith Nirgunarthy, director of marketing and high net-worth partnerships at Bitcoin IRA, was reluctant to read too much into the shift in positioning. “There’s been a lot of good news in the cryptocurrency space as of late,” he said. Earlier this week, Blockchain Capital, a venture fund focused on blockchain initiatives, closed its $10 million initial coin offering—the first of its kind in the U.S.—after just six hours. A blockchain is a decentralized, cryptographically secured ledger that powers digital currencies like bitcoin. The bitcoin BTCUSD, +0.45%  price retreated on Thursday after touching its highest level in three weeks. One coin was recently trading at $1,165.

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

Long Term Bitcoin Analysis

Long Term Bitcoin Analysis

  

Bitcoin (BTC) extended

upside movement against the US Dollar (USD) on Thursday to a weekly high of 1229, rallying the price of BTC/USD to more than 1200, the psychological number, as Japan legalized the cryptocurrency as online payment method while Russia is also mulling over to authorize the cryptocurrency. The technical bias however, remains bearish in near term.

Russia Intercedes into the Crypto World

Russia is mulling over to regulate the digital currency. Russian Deputy Finance Minister Alexey Moiseev told Bloomberg in an interview this week that the authorities hope to recognize bitcoin and other cryptocurrencies as a legal financial instrument in 2018 in a bid to tackle money laundering.

“The state needs to know who at every moment of time stands on both sides of the financial chain,” Moiseev told Bloomberg. If there’s a transaction, the people who facilitate it should understand from whom they bought and to whom they were selling, just like with bank operations.”

Increasing state regulations around bitcoin could make the cryptocurrency an attractive investment for investors who previously remained cautious due to the high risk and price swings.

Technical Analysis

As of this writing, BTC/USD is being traded around 1170. A 4-Hourly support may be seen around 1135. A major support however still holds around 1060 which is 50% Fibonacci level as demonstrated in the given below 4-hour chart with green color. EMA 200 is pushing upward on a short-term bias after a test at 1135. Trendline in red color is still major and effective as sellers gain momentum. A break and 4-Hourly closing below the 1135 support shall incite renewed selling pressure, validating a move towards 1060, the 50% fibonacci retracement and then a retest of the trend line around 950.

On the upside, bitcoin is expected to face a hurdle near 1230, a key horizontal resistance area ahead of 1300, the psychological number which is also the high of April 2017. The technical bias shall remain bullish as long as the 1135 support area is intact as mentioned before.

What to expect in Long-Term?

In long-term, a pull back will retest the trend line around 950 is very much expected. RSI (25) provides an extra conformation as it is heading lower sharply.

How to Trade BTC/USD in near future?

Selling BTC/USD below the 1135 support level can be a good strategy with stops being placed above 1180. Similarly, buying BTC/USD above 1200 level can be a good idea with stops being placed right below the 1135 support.

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

Legal Status of Bitcoin in India to Be Addressed at Global Summit by Assocham

Legal Status of Bitcoin in India to Be Addressed at Global Summit by Assocham

  

Legal Status of Bitcoin in India to Be Addressed
at Global Summit by Assocham

 

After the demonetization of 85 percent of the circulating currency in India in November 2016, ASSOCHAM organized the first global summit on Blockchain technology. Now it is all set to hold the second global summit on Blockchain technology with a focus on opportunities and challenges for the Indian economy. ASSOCHAM is a ‘chamber of chambers’ in India having been in existence since 1920 and having in its fold more than 400 industry chambers. The mission of ASSOCHAM is to ‘articulate the genuine, legitimate needs and interests of its members.’ They are also thought of as promoters of new business models.

Going beyond just a nascent technology

While the Blockchain has made a major impact in the world and its potential has been realized and is being released around the globe, in India the situation is still one of considering Blockchain as a nascent technology. The Second Global Summit which will be held in Bangalore on Friday, 21st April 2017 will focus on opportunities and challenges associated with Blockchain technology and explore the future prospects in India. The key discussion areas for the summit are the impact of Blockchain technology on banks, insurance, and financial institutions, legal perspectives and regulation from Bitcoin to Blockchain, applications of Bitcoin and Blockchain and criminal activity, security and data in the Blockchain.

It is expected that a wide variety of people from different backgrounds will attend the summit including company management, telecom and IT sector workers, security and legal heads, Bitcoin exchanges, regulators, bankers, fund managers and etc. Important representatives of the Indian government are expected to be present including Ravi Shankar Prasad, the Minister for Law and Justice and Electronics and IT. PP Chaudhary, the Minister of State Law and Justice and Electronics and IT, Dr. A.S. Ramasastri, Director for Development and Research in Banking Technology and others.

Negative news can be countered by information

In recent days there has been a lot of controversy regarding the status of Bitcoin and other cryptocurrencies in India. This is the result of misconceptions and misunderstanding of what Blockchain and Bitcoin are all about. We talked with Santosh Parashar, joint director and Head-Corporate Affairs and Capital Market Division of ASSOCHAM about the legality of Bitcoin and how this summit could help address these issues.

He says:

“I absolutely agree that in recent days there has been a lot of news about the legality of Bitcoin and other cryptocurrencies in India. Indeed, this is happening due to the lack of related know-how at different levels in the economy. A few illegal transactions that recently came into notice cannot be ignored with reference to Bitcoin and its legality in India. In our first summit organized in March 2017, nearly all such possible negatives related to Bitcoin were addressed. They were not a fairy tale but based on worldwide experiences that may or may not happen in India. Simultaneously, the investments and transactions in Bitcoin are not altogether ceasing to an end due to any such fear of legal status in India.”

Santosh further adds about learning from other countries and the role the summit is supposed to play, “The options available for India to choose from are – learning by practice, learning by mistakes or learning through others. To what extent, the cost of particular learning is affordable should be a subject matter of utmost priority. Certain countries like the US, China, and Japan which had banned Bitcoin earlier and now following the trend of acceptability must have learned through mistakes. This has to be taken care of by the investors as well as the government and regulators in India because it is a matter of economic significance. In the absence of any such legal tender of Bitcoin in India, ultimately opportunity cost is foregone as there is a loss of taxes to the government. Therefore, this summit is expected to address the legal issues, applications, and implication of Blockchain Technology in the light of recent global developments happening.”

India can become a Fintech Hub

India has been known as an IT hub for more than a decade now. The contributions of India’s IT sector can’t be downplayed as the country is the world’s largest sourcing destination for Information technology (IT) industry and accounts for 67 percent of the $124-130 bln market according to ibef. The industry also gives employment to close to 10 mln people. India can capitalize on its IT experience and recreate a similar success story in the Financial Technology (fintech) sector as well. The need though is for a better understanding of the possibilities that reside in this area and for changing perceptions in New Delhi.

The need for a conducive environment

Demonetization was followed by a push for a Cashless India where all the transactions are done digitally. In fact, if India truly does want to go digital, it will have to rely on the emergent fintech sector and try to embrace digital currencies and Blockchain technology.

Santosh points out:

“The traditional technology models used in the financial sector and sub-sectors for operations are becoming inoperative at the same cost. Hence the new cost effective and efficient technology has much scope to become handy. Fintech has gained substantial attention of traditional players in the Indian financial system. However, the participants of the fintech ecosystem require having a conducive environment of collaboration and dynamism. To build a robust fintech ecosystem, the proper mix of innovative and technical skills, CapEx, government policies and regulatory framework could drive fintech as a key enabler.”

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member

F2Pool: We Were Never Against SegWit. Wait…

F2Pool: We Were Never Against SegWit. Wait…

  

F2Pool: We Were Never Against SegWit. Wait…

Earlier today, Wang Chun, the owner of F2Pool, the second largest Bitcoin mining pool in the world, clarified that he was never against the activation of Bitcoin Core’s Segregated Witness (SegWit) on Litecoin.

Chun stated:

“Please let me do Charlie Lee a favor and clarify: I was never against SegWit on Litecoin.”

Just a few hours later, Chun offered a completely opposing stance on SegWit to his previous statement. What are Chun’s intent and motive? During an interview in February, Chun reaffirmed that F2Pool is pushing the activation of SegWit on Litecoin to observe its impact on overall scaling, on-chain capacity expansion and providing an infrastructure for two-layer solutions. At the time, Chun planned to support SegWit on Bitcoin upon the activation of SegWit on Litecoin.

Since then, Chun has emphasized his opposition to the Bitcoin Unlimited software and its team, due to multiple bug exploitations and the software’s instability. However, Chun has since expressed his concern over the Bitcoin Core development team as well.

In a rather conflicting statement, Chun wrote to Cointelegraph’s journalist:

“I've tried my best to love Core. But Core doesn't love me. Now I know Charlie Lee has a backup plan and it is called UASF.”

Chun’s criticism of Bitcoin Core came as a surprise to the Bitcoin community as he previously explained that Greg Maxwell, a Bitcoin Core developer, helped make his decision to support SegWit on Litecoin. It is highly likely that Maxwell introduced the benefits and advantages of activating SegWit and Chun agreed to observe the solution’s effect on Litecoin prior to implementing it on the Bitcoin network.

Currently, Chun is not in support of SegWit on Bitcoin, Bitcoin Core and Bitcoin Unlimited. He went as far as to encourage developers to find an alternative solution to SegWit since the majority of miners are not willing to accept SegWit as a scaling solution. “If the majority of the miners say no to SegWit, developers must find an alternative solution,” Chun said. Over the past week, a new solution called Extension Blocks was introduced by Bitcoin startup Purse’s BCoin. However, the community doesn’t seem to be convinced as of yet that Extension Blocks is the answer to Bitcoin scaling.

Based on the current trend, a user activated soft fork (UASF) is likely, considering that some of the largest businesses and companies within the Bitcoin industry already expressed their support toward UASF. Throughout this month, Chun has changed his stance on SegWit and Bitcoin scaling in multiple occasions. On April 6, Chun stated that he decided to reconsider SegWit on Litecoin. While Chun has been offering ambiguous statements to his followers and to the Bitcoin community, it is still likely that Chun will change his stance on SegWit on Bitcoin if the solution is activated properly on Litecoin.

Chuck Reynolds
Contributor

Alan Zibluk – Markethive Founding Member