Category Archives: Cryptocurrency
QuadrigaCX says it can’t reach millions of dollars’ worth of bitcoin and other cryptocurrency after its CEO died during a December trip to India. The CEO’s laptop is encrypted, the company says. Dan Kitwood/Getty Images hide caption
QuadrigaCX says it can’t reach millions of dollars’ worth of bitcoin and other cryptocurrency after its CEO died during a December trip to India. The CEO’s laptop is encrypted, the company says.
The QuadrigaCX cryptocurrency exchange says it can’t access some $190 million in bitcoin and other funds after its founder and CEO, Gerald Cotten, died at age 30 without sharing the password for his encrypted laptop.
Cotten was “the sole officer and director” of the Canadian cryptocurrency exchange when he died, said his widow, Jennifer Robertson, in an affidavit that is part of the company’s request for court assistance as it seeks protection from its creditors.
The debt filing comes weeks after Robertson announced that Cotten had died an event she described as “a shock to all of us.”
“Gerry died due to complications with Crohn’s disease on December 9, 2018 while travelling in India,” Robertson wrote, “where he was opening an orphanage to provide a home and safe refuge for children in need.”
Robertson, who is executor of Cotten’s estate, also announced that Quadriga has put new limits on daily withdrawals, trying to keep pace with demand and resolve transaction problems that lingered through much of last year.
In an update on its website about the debt filing, the exchange says it is facing “significant financial issues” that are keeping it from disbursing customers’ funds.
The company says that it has “very significant cryptocurrency reserves” but that it can’t locate or secure those reserves.
As of the end of January, Quadriga had some 115,000 users with balances in their accounts, Robertson said. Those users’ cryptocurrency was valued at $137 million in mid-December, with another $53 million in the form of government currency. The bulk of the holdings are in bitcoin; smaller amounts are held in other popular cryptocurrencies, including Litecoin and Ethereum.
Even before Cotten’s death, Quadriga was struggling to cope with transaction delays and other problems after legal disputes with a large bank and payment processors resulted in tens of millions of dollars being frozen.
In large part, Quadriga’s biggest crisis lies in how it (as well as many other exchanges) stores cryptocurrency customers’ funds in “hot wallets” that are used for quick-turnaround withdrawals and payments and in “cold wallets” that are stored offline to protect them from thieves and hackers.
Similar to how bank customers might split their checking and savings accounts, the cold wallets hold far more money; they are tapped only when hot wallets run low or when a user wants to make a large withdrawal. What is particularly problematic for Quadriga is that its CEO seems to be the only person who held the keys to those transactions.
“The transfer of coins from the cold wallet to the hot wallet was performed manually by [Cotten],” the affidavit from Robertson states.
Quadriga did not have offices or a bank account of its own; in the court filing, Robertson said, “Gerry ran the business through his laptop, mostly at our home, but also wherever he happened to be.”
“I do not have any documents or records” for the business, Robertson added, saying that she had searched the couple’s home in Fall River, Nova Scotia, and other locations but had found nothing.
The laptop that Cotten used to move funds between cold wallets and hot wallets is encrypted and locked leaving the exchange paralyzed after Cotten’s death, Robertson said.
“I do not know the password or recovery key,” she added. “Despite repeated and diligent searches, I have not been able to find them written down anywhere.”
Robertson said she and Quadriga have hired a security expert to try to break the encryption on Cotten’s laptop and an encrypted USB key. But she added that so far, the expert has had only limited success.
Saying “there should be in excess of $180 million [Canadian] of coins in cold storage” or $137 million Robertson wrote that the company is still trying to access the wallets, in addition to looking into the possibility that Cotten had used other exchanges to secure some of the funds.
That has left Quadriga customers wondering when and whether they’ll see their money. Discussion boards on Reddit are peppered with skeptical comments about the company’s efforts to work out its issues, and some users say they have upwards of $80,000 or $100,000 that has been locked away from them.
“This is a tough lesson learned. I would probably avoid [cryptocurrency] in the future,” Quadriga user Elvis Cavalic of Calgary, Alberta, told the CBC news agency. After not being able to withdraw $15,000 [Canadian], he said, “They’ve left us completely in the dark. I’m kind of preparing for the worst.”
In the debt filing, Robertson said she has faced threats and has seen speculation online about whether Cotten is actually alive some comments on Reddit and elsewhere have speculated that his death could be an elaborate ruse to siphon money away from the exchange’s customers.
Robertson’s affidavit notes that a copy of Cotten’s death certificate was submitted to the court, with the J.A. Snow Funeral Home stating that he died on Dec. 9, 2018, in Jaipur, India.
In seeking protection from creditors, Robertson said she had convened a board of directors to run the company. And she asked the court to give Quadriga “additional time to find whatever stores of cryptocurrency may be available” and resolve other outstanding issues.
“If this cannot be done in an orderly fashion, many, if not all users, may suffer damage,” she wrote.
The next legal step for the company is expected Tuesday, when it will ask the Nova Scotia Supreme Court to appoint Ernst & Young to monitor its debt proceedings as an independent third party.
When Quadriga was fully operational, its users could use a variety of means to fund an account with the exchange, from online transfers and automatic deposits to paying via cash or a debit card at thousands of Canada Post locations. Robertson said the many types of deposits made it difficult for the company to stop the inflow of money even as it lost its ability to access or disburse funds.
Robertson said Quadriga would consider selling its cryptocurrency platform as an option to fulfill its obligations to customers and creditors. Other companies have already come forward to express interest, she said, warning that the platform’s value would almost certainly be undercut if the company faced a legal threat from its users.
See original here:
Cryptocurrency Exchange Says It Can’t Access $190 Million …
Editor’s Note, Dec. 5, 2017:Since we first published this story in July, the 12 cryptocurrencies listed below have enjoyed an average gain of 145%. Readers who actedon these recommendationswhen we first released them have doubled their money or better. Its not too late to profit from the cryptocurrency boom. You just need to know how to find the fastest cryptocurrency profits. Stay ahead of the money and make more with our free, real-time Cryptocurrency Profit Alerts sent to your inbox. Sign up now here.
Bitcoin, with its first-mover advantage and robust security, is the best cryptocurrency to invest in today.
There are other cryptocurrencies worth putting some money into and we’ll look at some of those in a moment.
But Bitcoin (BTC) has emerged as the blue chip of the bunch.
In a nutshell, here’s why Bitcoin remains the best cryptocurrency to invest in despite all the competition:
And despite the big gains Bitcoin has enjoyed more than 180% just in 2017 it’s not too late to invest. The price of Bitcoin is likely to double by the end of the year. And over the next decade or so, the Bitcoin price could reach $100,000 or even $1 million.
Trending: Should I Sell My Bitcoin Now That It’s Above $10,000?
But what about Ethereum? The No. 2 cryptocurrency is also a very good bet
Having launched in 2015, Ethereum (ETH) is not only younger than Bitcoin, it’s younger than hundreds of other cryptocurrencies.
And yet it quickly surged to the No. 2 spot, giving you some idea of how much potential Ethereum has.
That potential is reflected in the huge gains in the Ethereum price. Even with its recent pullback to just under $200, the price of Ethereum is up 2,300% this year alone.
Some mistakenly believe Ethereum is in a rivalry with Bitcoin, but their differences make them complimentary.
These are also the traits that make Ethereum the next-best cryptocurrency to invest in:
These are the primary reasons why Ethereum price predictions for the end of 2017 go as high as $500.
Free Book: The secrets in this book helped one Money Morning reader make a $185,253 profit in just eight days. Learn how to claim your copy here
Still, some investors want to venture beyond Bitcoin and Ethereum into the wider world of cryptocurrencies
Of the more than 1,000 cryptocurrencies that have been launched, all but 26 trade for under $5.
It’s easy for investors to believe a cryptocurrency they pick up for $0.50 each will go to $100 or $1,000 and make them rich, even starting with modest sums of a few hundred dollars.
While not impossible, such an outcome is not likely. Apart from Bitcoin and Ethereum, only a handful of the hundreds of cryptocurrencies out there will enjoy substantial gains.
Think of cryptocurrencies today in terms of the dot-com boom of the late 1990s. Many of the overhyped Internet-based companies of the day went belly up in the dot-com bust of 2000-2001, taking billions of investor dollars with them.
But those with sound business concepts Amazon.com Inc. (Nasdaq: AMZN), eBay Inc. (Nasdaq: EBAY), and Priceline Group Inc. (Nasdaq: PCLN) went on to realize the promise of the dot-com hype.
The challenge is to figure out their latter-day equivalents among the cryptocurrencies.
For those willing and able to bear the risk, we’ve put together this list of the 10 best cryptocurrencies to invest in outside of Bitcoin and Ethereum
Join the conversation. Click here to jump to comments
See the article here:
What’s the Best Cryptocurrency to Invest in Today?
Start Trading Leading CryptocurrenciesWhat are Cryptocurrencies
A cryptocurrency is a digital coin, designed to be transferred between people in virtual transactions. Cryptocurrencies exist only as data and not as physical objects; you cannot actually hold a Bitcoin in your hand or keep Ethereum in your safe. Owning a Bitcoin means you have the collective agreement of each and every computer on the Bitcoin network that it is currently owned by you and more importantly that it was legitimately created by a miner.
Open a Trading Account at AvaTrade and start trading cryptocurrencies with a regulated broker today!
Cryptocurrencies are handled like cash but are mined like gold. Mining is simply the process of verifying a crypto transaction. People around the world transfer e-coins from wallet to wallet, while miners use computer-processing power to maintain the blockchain and verify these transactions.
When a new crypto is launched, its founders announce how many coins will be mined. Once the quota is reached, no further coins can be produced. The first digital coin introduced was Bitcoin, which remains today the benchmark for all other digital coins. Among other currencies that have made their way into the cryptocurrency hall-of-fame we have: Ethereum, Ripple, Litecoin, EOS, and a number of derived currencies, including Bitcoin Cash and Bitcoin Gold.
Unlike traditional transactions, cryptocurrency transfers are not handled by banks or other financial institutions. Every time someone pays via e-coin, his payment is recorded on a digital ledger called the blockchain.
A list of transaction records, called blocks, which are linked to each other and encrypted. The blockchain is continuously growing and is completely open to anyone. Each block in the blockchain contains:
When a new block is created, it is sent to all the users in the network. Each user then verifies the block and it is added to the blockchain.
Each one of the numerous cryptocurrencies existing today has its own blockchain, and the complex math that is at the heart of the blockchain is computer generated. In order to run a transaction on the blockchain you need an e-wallet (or cryptocurrency wallet).
The biggest problem of the Blockchain is its reliance on miners. This is exactly why the cryptocurrency called IOTA (the Internet of Thigs Application) was created in 2016. IOTA also battles increasing transaction fees and network scalability. IOTAs blockchain is called Tangle. It is a blockchain with no blocks and no chains. In this system, the users themselves are responsible for validating transactions. This means theres no need for approval from miners; so users enjoy a fee-free transaction and an increased process speed.
A piece of software or hardware that gives you the ability to store and exchange your cryptocurrencies. Each cryptocurrency wallet is encrypted and unique. When you send funds you actually broadcast an encrypted message to the recipient. Only the recipients cryptocurrency wallet can decrypt that message and thus receive the funds. A hardware cryptocurrency wallet is considered to have key advantages over other software wallets:
AvaTrade offers all traders the opportunity to trade a wide range of top-ranked digital coins 24/7. Due to the massive popularity of cryptocurrencies over the past couple of years, they have become a conventional and popular asset. The main purpose of this new technology is to allow people to buy, trade and invest without having to rely on banks or any other financial institutions.
Open a Trading Account at AvaTrade and start trading cryptocurrencies with a regulated broker today!
Open a Trading Account at AvaTrade and start trading cryptocurrencies with a regulated broker today!
This mega-powerful currency has not only opened the gate for other currencies, but also leads the cryptocurrency world with pride. It is governed to make sure no extra Bitcoin is produced, as a maximum quantity of 21 Million Bitcoin units was agreed to. When introduced, the rate was $1 to 1,309 BTC. The wheel has turned, and when Bitcoin reached the all-time high of $19,783.21 in 2017, it was certainly a meaningful milestone for Satoshi Nakamoto, the creator of Bitcoin.
Bitcoin Cash (BCH) was created by the Bitcoin hard fork on August 1, 2017, resulting in a new version of the blockchain with different rules. By switching from the main Bitcoin blockchain to a new version, the software now has a capacity for a larger number of transactions.
Bitcoin Gold (BTG) is the second fork from Bitcoin (i.e. the second version to stem from Bitcoins source code). It retains Bitcoins transaction history, meaning that if you owned Bitcoin before the fork, you now own the equal amount of Bitcoin Gold. This cryptocurrency aims to introduce an alternative mining algorithm that is less susceptible to ASIC-based optimization, therefore allowing users to earn more with their computer cycles.
Altcoins is the general term associated with the cryptocurrencies launched after Bitcoins success. At first, these were mere copies mimicking the original Bitcoin. Today, there are over 1,000 of these, and the list just keeps growing. Most crypto coins are launched following an ICO (Initial Coin Offering a form of crowdfunding) in which the developers raise cash by offering a limited number of initial coins to finance technological development. So far, besides the list below, we can find names, such as Namecoin, Peercoin, Bytecoin, Deutsche eMark, Novacoin, Cryptogenic Bullion, Quark, DarkCoin and Mangocoinz (for smartphones).
Ethereum (ETH) is more than just a currency its like one giant computer housing many computers around the globe. Ethereum can respond to sophisticated requests. Its ability to store revolutionary computer programs, known as smart contracts, gives Ethereum an edge over Bitcoin and has attracted attention from banks around the world. This, among other factors, has led to a jump of almost 10,000% in 2017!
Litecoin (LTC) is similar to Bitcoin in many of its characteristics and is also one of the more veteran cryptocurrencies out there. However, there are two main differences between Litecoin and Bitcoin: Speed and amount. While it takes 10 minutes to create a Bitcoin block, Litecoin demands roughly 2.5 minutes to create a block meaning 4 times the speed. Moreover, Litecoin attracts many users, as it can produce 4 times the quantity of Bitcoin! However, as Litecoin uses highly complex cryptography, often mining it is more complicated than other cryptocurrencies.
Ripple (XRP) can be described as the next generation of payment networks. Originally set up to engage financial industry leaders, the digital currency has been a leading technology so far. This cryptocurrency exploded in 2017, going from $0.0063 to over $1.
The e-coin that is considered Ethereums biggest competitor. The EOS blockchain gained its fame because of the way it effectively records and secures transactions. It is similar to the Ethereum blockchain but faster, more scalable, and allows users to build decentralized applications more efficiently. Market analysts are promoting the currency as The Most Powerful Infrastructure for Decentralized Applications and expect the coin to be dumped and pumped, which could provide some interesting short-term opportunities.
Cryptocurrencies allow traders to diversify their investment portfolio, as their price is mainly determined by demand and supply; Their value has a low correlation to national economies or political scenarios. Once Bitcoin surpassed the price of gold in 2017, US markets introduced 2 ETFs on Bitcoin and drew more and more institutional money into the world of cryptocurrencies. In 2017, Indian PM Narendra Modi has announced the gradual replacement of paper currency with electronic currency; In March 2018, the Marshall Islands announced that they would be introducing a cryptocurrency to replace US dollars as their main currency; other central banks are investigating the adoption of blockchain-like technologies in short cryptocurrencies are probably here to stay. A growing number of crypto investors all over the world have already discovered the benefits:
Open a Trading Account at AvaTrade and start trading cryptocurrencies with a regulated broker today!
The rest is here:
Cryptocurrency Trading Easy tips to get started | AvaTrade
Thailand has officially granted licenses to three cryptocurrency exchanges and one broker-dealer. Two exchanges have been rejected and one is still being reviewed. These seven companies have been temporarily allowed to operate in the country. Two of them will now begin closing down their businesses.
Also read:Indian Supreme Court Moves Crypto Hearing, Community Calls for Positive Regulations
The Thai Securities and Exchange Commission (SEC) announced on Tuesday the results of the applications for crypto business licenses. Seven companies applied for a license and have been allowed to operate their crypto businesses while the regulators reviewed their applications.
The countrys ministry of finance has granted digital asset business licences to four applicants, the Thai SEC detailed, noting that two applications have been rejected and one is still under review.
Three crypto exchanges and one broker-dealer have received licenses. The three approved exchanges are Bitcoin Exchange Co. Ltd. (Bx), Bitkub Online Co. Ltd. (Bitkub), and Satang Corporation (Satang Pro). The approved broker-dealer is Coins Th Co. Ltd.
Meanwhile, the license application filed by local crypto exchange Coin Asset Co. Ltd. is still being reviewed but the company is permitted to keep operating while the decision has not been made. The delay is due to a change of company executives, which is material information for the consideration of the application, the commission described.
The applications for crypto exchange licenses filed by Cash2coin Co. Ltd. and Southeast Asia Digital Exchange Co. Ltd. (Seadex) have been rejected. The Thai SEC revealed:
The applicants failed to meet the approval criteria regarding important work systems.
The commission added, For example, the systems for custody of client assets and know your customer (KYC) were inconsistent with the SECs acceptable standards, while the sufficiency of their IT security and cyber security systems could not be verified.
The two businesses have been notified of the closing down procedure by the Thai SEC.
The countrys ministry of finance is allowing both of them to continue operating until Jan. 14 to ensure proper proceeding of related matters including notification to the clients regarding asset refunds or asset transfers to other digital asset operators according to the clients order, the SEC noted. The twoare required to return customer assets and notify the commission of the results. However, the regulator clarified:
The application rejection this time does not invalidate their right to apply for a digital asset business licence in the future as long as the application criteria are met.
What do you think of Thailand granting licenses to four crypto operators and rejecting two? Let us know in the comments section below.
Images courtesy of Shutterstock and the Thai SEC.
Need to calculate your bitcoin holdings? Check ourtoolssection.
See original here:
Thailand Issues 4 Cryptocurrency Licenses, Rejects 2 …
CryptocurrencyDescriptionBitcoin (BTC)Bitcoin is the original peer-to-peer cryptocurrency founded in 2009 by Satoshi Nakomoto.Ethereum (ETH)Ethereum is a smart contract platform for decentralized applications (dapps).XRP (XRP)Ripple created XRP as a distributed network on which transactions can be made, near-instantaneously.Bitcoin Cash (BCH)Bitcoin Cash is a hard fork of Bitcoin (BTC) with an 8MB block size as opposed to Bitcoins 1MB.Stellar (XLM)XLM (or lumens) is the native asset of the Stellar Blockchain. Stellar aims to facilitate the movement of currency across borders quickly and at low cost.EOS (EOS)EOS is a decentralized application platform, similar to Ethereum. EOS aims to achieve greater scalability than Ethereum but has some drawbacks, including less decentralization and questionable governance.Litecoin (LTC)Litecoin is a source code fork of Bitcoin, so shares many similarities to the leading coin. Differences include its Scrypt mining algorithm and its higher limit for the total number of coins that can be created.Cardano (ADA)Cardano was created by one of the Ethereum co-founders, Charles Hoskinson. Cardano claims it will be capable of running financial applications. It is being constructed in layers.Monero (XMR)Monero is the leading privacy coin. Transactions on Moneros ledger are obfuscated which means third parties cannot determine the source or destination of the funds.TRON (TRX)Tron was founded by Justin Sun, and claims to be dedicated to the establishment of a truly decentralized Internet and its infrastructure. The project is not without controversy, having borrowed source code heavily from other projects.IOTA (IOTA)IOTA was designed for Internet of Things (IoT) devices. IOTA enables data and financial exchange between these devices.Dash (DASH)Dash is a Bitcoin fork that enhances privacy, has low fees and near-instant transactions thanks partly to a proof of stake mining algorithm.Binance Coin (BNB)The Binance cryptocurrency exchange issuedBNB. Users of the exchange can utilize the coin to pay reduced trading feesNEM (XEM)NEM stands for New Economy Movement and is a fork of NXT. NEMs blockchain is designed for speed and scale and uses supernodes to achieve consensus.NEO (NEO)NEO is a Chinese blockchain project which aims to create a smart economy through the use of digital assets, digital identity and smart contracts.Ethereum Classic (ETC)Ethereum Classic is a fork of Ethereum which came shortly after the notorious DAO Hack. While Ethereum effectively rolled back the resulting transactions from the bad actor(s) created during the hack, Ethereum Classic chose to continue the chain without altering these transactions.Tezos (XTZ)Tezos is similar to Ethereum and EOS in that it facilitates smart contracts and dapps. Tezos uses on-chain governance and proof-of-stake mining algorithm known as baking.Are Litecoin and Bitcoin the Same?
While they have many similarities, they are not the same. Litecoin (LTC) uses the Scrypt mining algorithm, which is more simple than Bitcoins SHA-256 algorithm. Litecoin also has a maximum limit of 84 million coins that can ever exist, whereas Bitcoin has a limit of 21 million. Transactions on the Litecoin network will be confirmed after around two and a half minutes, faster than Bitcoins approximate 10 minute confirmation time.
Ethereum (ETH) is a decentralized, open source blockchain platform which enables technology known as smart contracts.Smart contracts enable decentralized applications (dapps), which developers can create to serve a variety of purposes in many different industries. Ethereum can be used to exchange money or anything else of value, and via smart contracts, these exchanges can happen once certain conditions have been met. The Ethereum ledger is public, and all historical transactions are publicly viewable.
In July 2016, Ethereum implemented a contentious hard fork to restore funds stolen during the DAO hack; a hack involving the theft of 3.6 million ETH. During this fork, miners who contended the restoration of stolen funds chose to continue mining on the previous chain, and Ethereum Classic (ETC) was born.
Ripple is the settlement system and network created by Ripple Labs Inc. It supports tokens tied to many units of value including fiat currencies and commodities.
Ripples native currency, XRP, was previously also referred to as Ripple. But since the question of whether XRP is a security remains unanswered, Ripple Labs have tried to distance their company and platform from the XRP cryptocurrency.
XRP is the native cryptocurrency of Ripple. It is used to help transfer value across the Ripple network. XRP acts as the bridge between two units of value on the peer-to-peer Ripple network.
New cryptocurrency exchange has reportedly raised $27.5 million from investors which include NASDAQ Ventures and Fidelity Investments. The platform will offer cryptocurrency trading on spot and future markets starting next year.
Seemingly unphased by the current bleeding conditions of the cryptocurrency market, Fidelity Investments and NASDAQ Ventures have reportedly taken part in a funding round of new cryptocurrency exchange ErisX. The total amount raised is $27.5 million,Reutersreports.
According to the report, Nasdaq has already confirmed its participation while Fidelity is yet to respond to the requests for comment.
The new cryptocurrency exchange will purportedly enable investors to trade Bitcoin (BTC) 00, Litecoin (LTC) 00, and Ether (ETH) 00 on both spot and futures markets. It is expected to launch in 2019 following regulatory approval.
Speaking on the matter was Thomas Chippas, CEO at ErisX, who noted that the investments will be used tobuild out our infrastructure and secure the appropriate steps are taken to develop a regulated market for digital assets, and to hire staff.
Its worth noting that Chippas, according to his LinkedIn profile, comes from the banking sector and a former ManagingDirector at Citi and Barclays.
Nasdaqs involvement in ErisX comes just a few days after it renewed its vow to offer Bitcoin futures despite the current BTC price 00 drop.
Bitcoinistreported November 27 that NASDAQhas been working to satisfy the concerns of the US main swaps regulator, the Commodity Futures Trading Commission (CFTC), before launching the contracts.
Fidelitys participation in ErisX also makes sense, as the asset manager recently said that it wont open its own exchange, but instead will focus on providing Bitcoin custody solution.
However, earlier in October, the company also stated that it intends to open cryptocurrency trading to its 27 million customers, so perhaps this falls in line with their involvement in ErisX latest round of investment.
What do you think of Fidelity and Nasdaqs involvement in ErisX? Dont hesitate to let us know in the comments below!
Images courtesy of Shutterstock
The rest is here:
NASDAQ, Fidelity Invest in New Cryptocurrency Exchange …
Home Token Coins, Tokens & Altcoins: Whats the Difference?
This article explores the subtle differences between cryptocurrency coins and tokens, and why the term cryptocurrency is a misnomer.
Cryptocurrencies can be extremely hard to wrap our heads around, especially since their underlying technology the Blockchain is shrouded in computing language and terminology that is technical in nature. This is a huge barrier to many who are interested to learn more about cryptocurrencies and blockchain technology. But do not worry! Well guide you in understanding key cryptocurrency concepts that is great for you to know. (See more:Guide to Common Crypto Terms)
Lets start with understanding the definition of cryptocurrencies. Cryptocurrencies are digital or virtual currencies that are encrypted (secured) using cryptography. Cryptography refers to the use of encryption techniques to secure and verify the transfer of transactions. Bitcoin represents the first decentralized cryptocurrency, which is powered by a public ledger that records and validates all transactions chronologically, called the Blockchain. Heres an overview of how the blockchain works:
(Source: The Bernie Group)
Although many cryptocurrencies have existed prior to Bitcoin, its creation marks an important milestone in the realm of digital currencies, due to its distributed and decentralized nature. The creation of Bitcoin precipitated the expansion of a lush and more diverse ecosystem of other coins and tokens, that are often regarded as cryptocurrencies in general, even when most of them do not fall under the definition of a currency.
(See more:Evolution of Cryptocurrency: The Problem With Money Today)
It is important to note that all coins or tokens are regarded as cryptocurrencies, even if most of the coins do not function as a currency or medium of exchange. The term cryptocurrency is a misnomer since a currency technically represents a unit of account, a store of value and a medium of exchange. All these characteristics are inherent within Bitcoin, and since the cryptocurrency space was kickstarted by Bitcoins creation, any other coins conceived after Bitcoin is generally considered as a cryptocurrency, though most do not fulfill the aforementioned characteristics of an actual currency.
The most common categorization of cryptocurrencies are:
Alternative cryptocurrency coins are also called altcoins or simply coins. Theyre often used interchangeably. Altcoins simply refers to coins that are an alternative to Bitcoin. The majority of altcoins are a variant (fork) of Bitcoin, built using Bitcoins open-sourced, original protocol with changes to its underlying codes, therefore conceiving an entirely new coin with a different set of features. A central concept of modifying open source codes to create new coins is called hardforks, which is further explained in this article. Some examples of altcoins that are variants of Bitcoins codes are Namecoin, Peercoin, Litecoin, Dogecoin and Auroracoin. (Read also:Bitcoins Civil War: How and Why?)
Fun fact: A software fork occurs when there is a change in the underlying programming protocol, resulting in the forking or split of the original blockchain. This usually results in the creation of a new coin. There are different types of forks such as hard fork, soft forkor accidental fork.
There are other altcoins that arent derived from Bitcoins open-source protocol. Rather, they have created their own Blockchain and protocol that supports their native currency. Examples of these coins include Ethereum, Ripple, Omni, Bitshares, NEO, Waves and Counterparty.
A commonality of all altcoins is that they each possess their own independent blockchain, where transactions relating to their native coins occur in.
Fun fact: The first Altcoin was Namecoin, which was created in April 2011. It is a decentralized open source information registration and transfer system
(Read also:Guide on Identifying Scam Coins)
Tokens are a representation of a particular asset or utility, that usually resides on top of another blockchain. Tokens can represent basically any assets that are fungible and tradeable, from commodities to loyalty points to even other cryptocurrencies!
Creating tokens is a much easier process as you do not have to modify the codes from a particular protocol or create a blockchain from scratch. All you have to do is follow a standard template on the blockchain such as on the Ethereum or Waves platform that allows you to create your own tokens. This functionality of creating your own tokens is made possible through the use of smart contracts; programmable computer codes that are self-executing and do not need any third-parties to operate. It really is super cool! Heres a look at the process:
Tokens are created and distributed to the public through an Initial Coin Offering (ICO), which is a means of crowdfunding, through the release of a new cryptocurrency or token to fund project development. It is similar to an Initial Public Offering (IPO) for stocks, with critical distinctions whichare explained in this article. Many are crazy over ICOs as they represent a great way of identifying interesting projects that can provide great financial returns.
Fun Fact: A template for token creation is wonderful since it provides a standard interface for interoperability between tokens. This make it so much easier for you to store different type of coins within a single wallet. An example is the ERC-20 standard on the Ethereum blockchain, which has is used by over 40 tokens
(Read more: Analyzing Cryptocurrency Risk: Existing Coins vs ICO)
The main difference between altcoins and tokens is in their structure; altcoins are separate currencies with their own separate blockchain while tokens operate on top of a blockchain that facilitates the creation of decentralized applications. The majority of coins in existence (close to 80%) are tokens, since theyre much more easier to create.
(You might also be interested inWill A Crash in Bitcoins Price Lead to Its Demise?)
If youre starting your journey into the complex world of cryptocurrencies, heres a list of useful resources and guides that will get you on your way:
Read also:Crypto Trading Guide: 4 Common Pitfalls Every Crypto Trader Will ExperienceandGuide To Cryptocurrency Trading Basics: Introduction to Crypto Technical Analysis.
Enroll in our Free Cryptocurrency Webinar now to learn everything you need to know about crypto investing.
Get our exclusive e-book which will guide you on the step-by-step process to get started with making money via Cryptocurrency investments!
You can also join our Facebook group at Master The Crypto: Advanced Cryptocurrency Knowledge to ask any questions regarding cryptos!
Read more from the original source:
Differences Between Cryptocurrency Coins and Tokens
Cryptocurrency exchanges have turn into highly regarded in 2018 as a result of rising curiosity in Bitcoin and altcoins. One usually problematic side is cryptocurrency charts, the place not solely do many exchanges have poor charting performance, however in addition they usually solely supply these charts for coins they support. So should you use multiple trade, to test every day costs you’ll want to go to every particular person trade.
Cryptocurrency Live Price Charts ListWhen first launched to crypto, many individuals seek for ‘Bitcoin price’ or ‘Bitcoin price chart’ hoping to see Bitcoin’s current and historic price. At this stage most individuals do not actually care about performance like technical evaluation, buying and selling integration, and so forth. they simply need a chart that hundreds quick and has correct knowledge, and perhaps need an summary of the cryptocurrency market as a complete e.g. total market cap of all coins.In this space many coins supply their very own charts. However should you work together with multiple coin, it is helpful to have a single web site that helps many various cash. A few of our favorites that help many hundreds of cash, load very quick and have up-to-date knowledge at Cryptocurrency Charts
Read this article:
A cryptocurrency is a digital or virtual currency designed to work as a medium of exchange. It uses cryptography to secure and verify transactions as well as to control the creation of new units of a particular cryptocurrency. Essentially, cryptocurrencies are limited entries in a database that no one can change unless specific conditions are fulfilled.
There have been many attempts at creating a digital currency during the 90s tech boom, with systems like Flooz, Beenz and DigiCash emerging on the market but inevitably failing. There were many different reasons for their failures, such as fraud, financial problems and even frictions between companies employees and their bosses.
Notably, all of those systems utilized a Trusted Third Party approach, meaning that the companies behind them verified and facilitated the transactions. Due to the failures of these companies, the creation of a digital cash system was seen as a lost cause for a long while.
Then, in early 2009, an anonymous programmer or a group of programmers under an alias Satoshi Nakamoto introduced Bitcoin. Satoshi described it as a peer-to-peer electronic cash system. It is completely decentralized, meaning there are no servers involved and no central controlling authority. The concept closely resembles peer-to-peer networks for file sharing.
One of the most important problems that any payment network has to solve is double-spending. It is a fraudulent technique of spending the same amount twice. The traditional solution was a trusted third party – a central server – that kept records of the balances and transactions. However, this method always entailed an authority basically in control of your funds and with all your personal details on hand.
In a decentralized network like Bitcoin, every single participant needs to do this job. This is done via the Blockchain – a public ledger of all transaction that ever happened within the network, available to everyone. Therefore, everyone in the network can see every accounts balance.
Every transaction is a file that consists of the senders and recipients public keys (wallet addresses) and the amount of coins transferred. The transaction also needs to be signed off by the sender with their private key. All of this is just basic cryptography. Eventually, the transaction is broadcasted in the network, but it needs to be confirmed first.
Within a cryptocurrency network, only miners can confirm transactions by solving a cryptographic puzzle. They take transactions, mark them as legitimate and spread them across the network. Afterwards, every node of the network adds it to its database. Once the transaction is confirmed it becomes unforgeable and irreversible and a miner receives a reward, plus the transaction fees.
Essentially, any cryptocurrency network is based on the absolute consensus of all the participants regarding the legitimacy of balances and transactions. If nodes of the network disagree on a single balance, the system would basically break. However, there are a lot of rules pre-built and programmed into the network that prevents this from happening.
Cryptocurrencies are so called because the consensus-keeping process is ensured with strong cryptography. This, along with aforementioned factors, makes third parties and blind trust as a concept completely redundant.
In the past, trying to find a merchant that accepts cryptocurrency was extremely difficult, if not impossible. These days, however, the situation is completely different.
There are a lot of merchants – both online and offline – that accept Bitcoin as the form of payment. They range from massive online retailers like Overstock and Newegg to small local shops, bars and restaurants. Bitcoins can be used to pay for hotels, flights, jewelery, apps, computer parts and even a college degree.
Other digital currencies like Litecoin, Ripple, Ethereum and so on arent accepted as widely just yet. Things are changing for the better though, with Apple having authorized at least 10 different cryptocurrencies as a viable form of payment on App Store.
Of course, users of cryptocurrencies other than Bitcoin can always exchange their coins for BTCs. Moreover, there are Gift Card selling websites like Gift Off, which accepts around 20 different cryptocurrencies. Through gift cards, you can essentially buy anything with a cryptocurrency.
Finally, there are marketplaces like Bitify and OpenBazaar that only accept cryptocurrencies.
Read more in the article What can I buy with Bitcoins?
Many people believe that cryptocurrencies are the hottest investment opportunity currently available. Indeed, there are many stories of people becoming millionaires through their Bitcoin investments. Bitcoin is the most recognizable digital currency to date, and just last year one BTC was valued at $800. In November 2017, the price of one Bitcoin exceeded $7,000.
Ethereum, perhaps the second most valued cryptocurrency, has recorded the fastest rise a digital currency ever demonstrated. Since May 2016, its value increased by at least 2,700 percent. When it comes to all cryptocurrencies combined, their market cap soared by more than 10,000 percent since mid-2013.
However, it is worth noting that cryptocurrencies are high-risk investments. Their market value fluctuates like no other assets. Moreover, it is partly unregulated, there is always a risk of them getting outlawed in certain jurisdictions and any cryptocurrency exchange can potentially get hacked.
If you decide to invest in cryptocurrencies, Bitcoin is obviously still the dominant one. However, in 2017 its share in the crypto-market has quite dramatically fallen from 90 percent to just 40 percent. There are many options currently available, with some coins being privacy-focused, others being less open and decentralized than Bitcoin and some just outright copying it.
While its very easy to buy Bitcoins – there are numerous exchanges in existence that trade in BTC – other cryptocurrencies arent as easy to acquire. Although, this situation is slowly improving with major exchanges like Kraken, BitFinex, BitStamp and many others starting to sell Litecoin, Ethereum, Monero, Ripple and so on. There are also a few other different ways of being coin, for instance, you can trade face-to-face with a seller or use a Bitcoin ATM.
Once you bought your cryptocurrency, you need a way to store it. All major exchanges offer wallet services. But, while it might seem convenient, its best if you store your assets in an offline wallet on your hard drive, or even invest in a hardware wallet. This is the most secure way of storing your coins and it gives you full control over your assets.
As with any other investment, you need to pay close attention to the cryptocurrencies market value and to any news related to them. Coinmarketcap is a one-stop solution for tracking the price, volume, circulation supply and market cap of most existing cryptocurrencies.
Depending on a jurisdiction you live in, once youve made a profit or a loss investing in cryptocurrencies, you might need to include it in your tax report. In terms of taxation, cryptocurrencies are treated very differently from country to country. In the US, the Internal Revenue Service ruled that Bitcoins and other digital currencies are to be taxed as property, not currency. For investors, this means that accrued long-term gains and losses from cryptocurrency trading are taxed at each investors applicable capital gains rate, which stands at a maximum of 15 percent.
Miners are the single most important part of any cryptocurrency network, and much like trading, mining is an investment. Essentially, miners are providing a bookkeeping service for their respective communities. They contribute their computing power to solving complicated cryptographic puzzles, which is necessary to confirm a transaction and record it in a distributed public ledger called the Blockchain.
One of the interesting things about mining is that the difficulty of the puzzles is constantly increasing, correlating with the number of people trying to solve it. So, the more popular a certain cryptocurrency becomes, the more people try to mine it, the more difficult the process becomes.
A lot of people have made fortunes by mining Bitcoins. Back in the days, you could make substantial profits from mining using just your computer, or even a powerful enough laptop. These days, Bitcoin mining can only become profitable if youre willing to invest in an industrial-grade mining hardware. This, of course, incurs huge electricity bills on top of the price of all the necessary equipment.
Currently, Litecoins, Dogecoins and Feathercoins are said to be the best cryptocurrencies in terms of being cost-effective for beginners. For instance, at the current value of Litecoins, you might earn anything from 50 cents to 10 dollars a day using only consumer-grade hardware.
But how do miners make profits? The more computing power they manage to accumulate, the more chances they have of solving the cryptographic puzzles. Once a miner manages to solve the puzzle, they receive a reward as well as a transaction fee.
As a cryptocurrency attracts more interest, mining becomes harder and the amount of coins received as a reward decreases. For example, when Bitcoin was first created, the reward for successful mining was 50 BTC. Now, the reward stands at 12.5 Bitcoins. This happened because the Bitcoin network is designed so that there can only be a total of 21 mln coins in circulation.
As of November 2017, almost 17 mln Bitcoins have been mined and distributed. However, as rewards are going to become smaller and smaller, every single Bitcoin mined will become exponentially more and more valuable.
All of those factors make mining cryptocurrencies an extremely competitive arms race that rewards early adopters. However, depending on where you live, profits made from mining can be subject to taxation and Money Transmitting regulations. In the US, the FinCEN has issued a guidance, according to which mining of cryptocurrencies and exchanging them for flat currencies may be considered money transmitting. This means that miners might need to comply with special laws and regulations dealing with this type of activities.
Read more in the article How to Mine Bitcoin: Everything You Need to Know.
If you happen to own a business and if youre looking for potential new customers, accepting cryptocurrencies as a form of payment may be a solution for you. The interest in cryptocurrencies has never been higher and its only going to increase. Along with the growing interest, also grows the number of crypto-ATMs located around the world. Coin ATM Radar currently lists almost 1,800 ATMs in 58 countries.
First of all, you need to let your customers know that your business accepts crypto coins. Simply putting a sign by your cash register should do the trick. The payments can then be accepted using hardware terminals, touch screen apps or simple wallet addresses through QR codes.
There are many different services that you can use to be able to accept payments in cryptocurrencies. For example, CoinPayments currently accepts over 75 different digital currencies, charging just 0.5 percent commission per transaction. Other popular services include Cryptonator, CoinGate and BitPay, with the latter only accepting Bitcoins.
In the US, Bitcoin and other cryptocurrencies have been recognized as a convertible virtual currency, which means accepting them as a form of payment is exactly the same as accepting cash, gold or gift cards.
For tax purposes, US-based businesses accepting cryptocurrencies need to record a reference of sales, amount received in a particular currency and the date of transaction. If sales taxes are payable, the amount due is calculated based on the average exchange rate at the time of sale.
As cryptocurrencies are becoming more and more mainstream, law enforcement agencies, tax authorities and legal regulators worldwide are trying to understand the very concept of crypto coins and where exactly do they fit in existing regulations and legal frameworks.
With the introduction of Bitcoin, the first ever cryptocurrency, a completely new paradigm was created. Decentralized, self-sustained digital currencies that dont exist in any physical shape or form and are not controlled by any singular entity were always set to cause an uproar among the regulators.
A lot of concerns have been raised regarding cryptocurrencies decentralized nature and their ability to be used almost completely anonymously. The authorities all over the world are worried about the cryptocurrencies appeal to the traders of illegal goods and services. Moreover, they are worried about their use in money laundering and tax evasion schemes.
As of November 2017, Bitcoin and other digital currencies are outlawed only in Bangladesh, Bolivia, Ecuador, Kyrgyzstan and Vietnam, with China and Russia being on the verge of banning them as well. Other jurisdictions, however, do not make the usage of cryptocurrencies illegal as of yet, but the laws and regulations can vary drastically depending on the country.
Read more: Is Bitcoin Legal
(stats retrieved on Nov. 10, 2017)
Unlike most traditional currencies, cryptocurrencies are digital, which entails a completely different approach, particularly when it comes to storing it. Technically, you dont store your units of cryptocurrency; instead its the private key that you use to sign for transactions that need to be securely stored.
There are several different types of cryptocurrency wallets that cater for different needs. If your priority is privacy, you might want to opt for a paper or a hardware wallet. Those are the most secure ways of storing your crypto funds. There are also cold (offline) wallets that are stored on your hard drive and online wallets, which can either be affiliated with exchanges or with independent platforms.
Read more in the article Bitcoin Wallets for Beginners: Everything You Need to Know.
There are a lot of different options when it comes to buying Bitcoins. For example, there are currently almost 1,800 Bitcoin ATMs in 58 countries. Moreover, you can buy BTC using gift cards, cryptocurrency exchanges, investment trusts and you can even trade face-to-face.
When it comes to other, less popular cryptocurrencies, the buying options arent as diverse. However, there are still numerous exchanges where you can acquire various crypto-coins for flat currencies or Bitcoins. Face-to-face trading is also a popular way of acquiring coins. Buying options depend on particular cryptocurrencies, their popularity as well as your location.
Read more in the article How to Buy Bitcoin: Best Practices, Where to Buy, Tips.
See the full list here: Top People In Blockchain.
Bill Gates, co-founder of Microsoft, investor and philanthropist:
Bitcoin is exciting because it shows how cheap it can be. Bitcoin is better than currency in that you dont have to be physically in the same place and, of course, for large transactions, currency can get pretty inconvenient. [SOURCE]
Richard Branson, founder of Virgin Galactic and more than 400 other businesses:
Well, I think it is working. There may be other currencies like it that may be even better. But in the meantime, theres a big industry around Bitcoin.People have made fortunes off Bitcoin, some have lost money. It is volatile, but people make money off of volatility too. [SOURCE]
Al Gore, former Vice President of the United States:
When Bitcoin currency is converted from currency into cash, that interface has to remain under some regulatory safeguards. I think the fact that within the Bitcoin universe an algorithm replaces the function of the government[that] is actually pretty cool. [SOURCE]
Eric Schmidt, executive chairman of Google:
[Bitcoin] is a remarkable cryptographic achievement The ability to create something which is not duplicable in the digital world has enormous valueLots of people will build businesses on top of that. [SOURCE]
Peter Thiel, co-founder of PayPal:
PayPal had these goals of creating a new currency. We failed at that, and we just created a new payment system. I think Bitcoin has succeeded on the level of a new currency, but the payment system is somewhat lacking. Its very hard to use, and thats the big challenge on the Bitcoin side. [SOURCE]
Continue reading here:
What is cryptocurrency? – cointelegraph.com
A year ago, the idea that Bitcoin and cryptocurrencies were going to change the world was becoming the consensus opinion. Today, not so much.
The digital currencynow trades below $5,000. Its 77% off its high near $20,000 in January. Other cryptos are collapsing, too.
Blockchain technology, cryptocurrency mining. Server roomGetty
There is a catalyst. People who follow digital tokens blame thehard forkof Bitcoin Cash. The smaller, namesake cryptocurrency is itself a fork of Bitcoin proper. But last week, its developers and miners could not agree on the future of the digital token. So they decided to split into two competing cryptos, Bitcoin ABC and Bitcoin Satoshis Vision (SV).
If that seems like an inherently bad idea, it is. Bitcoin is an open source project. Developers are free to duplicate the base code and create cryptocurrencies at will. And they have. As of November 2018, there are 2,502 cryptocurrencies, according to alistcompiled at Investing.com. The cumulative market capitalization of these tokens is $142 billion, although it had been much higher.
Forgive me. Im burying the lede. The problem with Bitcoin, and cryptocurrency in general, is not forking. Its that developers should not be able tocreatecurrency, at all.
I began writing inJanuarythat cryptocurrencies were where the internet was in the dot-com era, and inFebruarythat most of these thousands of cryptos were headed to zero. At the time, it was not a popular position. I prefaced my view on two things every potential investor needs to understand about me too digital coins: There is no use case, and worse, its unlikely they will ever represent a store of value.
Keep in mind, many things can represent a store of value. Collectibles like art, baseball cards and signed memorabilia immediately come to mind. Cryptocurrencies, at least the vast majority of them, will never be that.
Bill Harris, a former chief executive officer atPayPal, made headlines in August when he wrote atRecode: OK, Ill say it: Bitcoin is a scam.
Harris argues Bitcoin is a pump-and-dump scheme, where promoters push up the value of dubious investments with hype and relentless advocacy. As the price surges and enthusiasm is greatest, they dump everything, leaving unsuspecting investors holding worthless securities.
Admittedly, I have made this case about so-called alternative coins. Investing in an Initial Coin Offering is like speculating in a highly promoted junior gold mining company where the prospect of finding actual gold is nil. There will be price volatility and plenty of promises made. But in the end, the investment is worthless. And it was always going to be worthless.
But Harris is conflating Bitcoin with alternative coins. That is a mistake, I believe.
A pure digital currency is a good idea.It takes power away from central authority. The problem is oversupply. There are currently too many coins and too many charlatans.
This will pass. The Securities and Exchange Commission will round up the fraudsters. Their fake investment premises will lead to a great reckoning. Most ICOs will go to zero because they will be unable to pass the test of legitimate government oversight.
That could leave Bitcoin as one of the last digital coins standing. When that happens, my guess is it will ultimately be more valuable than it is today. However, there is plenty of pain ahead as pump-and-dump schemes are uncovered, and most coins collapse souring the mood for all their peers.
The play for stock investors is blockchain, Bitcoins cryptographic infrastructure
Ultimately, this digital ledger system is going to find its way into global supply chains and financial services because it systematically removes middling trusted agents for verification.
Blockchain will make legions of accountants, lawyers and back office personnel redundant.
IDC, a global information technology research firm, sees blockchain as part of alarger digital transformation. The shift could be worth $7 trillion by 2022.
Microsoftwas an early convert to the power of blockchain. Itbegan workingwith financial services start-ups in 2016. More recently, the Redmond, Wash., software giant has been touting the scalability of its Azure cloud computing platform to run ledger systems. The company is even working on a blockchain-as-a-service tool.
Shares trade at 20x forward earnings. The market capitalization has come down to $780 billion in the last leg of the tech wreck. The stock would be a great pickup in the low $90s.