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Posted on 21 February 2018 | 1:25 pm

Venezuela Launches “Petros” Cryptocurrency Amid Growing Skepticism

Venezuela Launches “Petros” Cryptocurrency Amid Growing Skepticism

With crushing debt and a starving population, the Maduro government in Venezuela is launching what it says is the world's first sovereign cryptocurrency.

The cryptocurrency is designed to bypass U.S. government sanctions against the socialist regime. The “Petros” cryptocurrency will have an initial value tied to the price of a barrel of Venezuelan crude oil in mid-January, which was $60 per barrel, with a target of 100 million Petros to be sold.

The U.S. Treasury Department warned that the move may violate last year’s sanctions, while Venezuelan opposition leaders say the sale constitutes an illegal issuing of debt.

After the first day of trading, President Maduro claimed to have raised $735 million. State officials are claiming a 5x increase in traffic to the website, but some critics, including Venezuelan product designer and cryptocurrency writer Alejandro Machado, are skeptical.

In speaking with Bitcoin Magazine, Machado commented that he was unable to find any transactions on the blockchain regarding Petros and, while the token was originally slated to be released on the Ethereum network, it since has transitioned to NEM.

“The government hasn't confirmed that this is the address, but they confirmed they're using NEM, and it's the only mosaic matching the Petro description,” Machado said. “The mosaic's metadata also uses similar phrasing to the white paper.”

Machado has been writing about the upcoming Petros since early December 2017, remarking, “Many think it’s yet another episode of empty propaganda, but I profoundly disagree: chavismo is facing the existential danger of running out of funds, and they’re betting heavily on the Petro.”

His skepticism about the plan runs deep: “No doubt aware of their terrible track record, the government is incentivizing participation in the private sale by offering a 60% discount. What company in the world would sell 38 million units of a product for less than half their market value? A company that doesn’t intend to ship you the product after you buy, of course.”

With $150 billion in foreign debt, quadruple-digit inflation, the collapse of their oil output, and crushing sanctions by the U.S. and the EU, the Venezuelan government has become increasingly creative in ways to generate revenue. Petros represent nothing more than a promise against the 300 million barrels of oil that Venezuela believes they can recover but have yet to pull from the ground. There is an additional problem that U.S.-based investors purchasing the Petros would be in violation of American sanctions and could find themselves in trouble with Uncle Sam.

This article originally appeared on Bitcoin Magazine.

Posted on 21 February 2018 | 11:25 am

Lawmakers Renew Calls for US to Lead on Crypto Innovation

Following a U.S. Congressional hearing on cryptocurrency and blockchain, three lawmakers are renewing calls for the government to embrace innovation.

Posted on 21 February 2018 | 11:20 am

Crypto Market In The Red Despite Bitcoin Transaction Fees Dropping, Dominance Rising - Cointelegraph (Bitcoin, Cryptocurrency and Blockchain News)


Cointelegraph (Bitcoin, Cryptocurrency and Blockchain News)

Crypto Market In The Red Despite Bitcoin Transaction Fees Dropping, Dominance Rising
Cointelegraph (Bitcoin, Cryptocurrency and Blockchain News)
While Bitcoin (BTC) dominance is up and Bitcoin transaction fees are down, the crypto market is seeing an overall downturn by press time, Wednesday, Feb. 21, with all of the top 30 coins on CoinMarketCap in the red. Bitcoin dominance, or BTC's market ...
Bitcoin Fees Sink to 6 Month Low, Undermining Bitcoin CashBitcoinist

all 17 news articles »

Posted on 21 February 2018 | 10:50 am

Bitcoin exchanges add tech to make transactions 20% cheaper - CNBC


CNBC

Bitcoin exchanges add tech to make transactions 20% cheaper
CNBC
Two of the biggest cryptocurrency exchanges are aiming to make bitcoin transactions faster and cheaper with a new software update announced this week. Both Coinbase and Bitfinex said they are adopting a software called SegWit, which bitcoin bulls and ...
Bitcoin Price and Cryptocurrency Markets Shed GainsInvestopedia (blog)
Bitcoin Needs To Be Lightning FastSeeking Alpha
Coinbase is finally supporting SegWit, an update that could fix bitcoin's biggest problems. Here's what's happening.Business Insider
Cointelegraph (Bitcoin, Cryptocurrency and Blockchain News) -MarketWatch -Bitcoin Magazine -The Coinbase Blog
all 44 news articles »

Posted on 21 February 2018 | 10:13 am

Iran Isn't So Keen on Bitcoin After All. But It May Have Other Cryptocurrency Plans. - Fortune


Fortune

Iran Isn't So Keen on Bitcoin After All. But It May Have Other Cryptocurrency Plans.
Fortune
Late last year, there were reports that the Iranian government was keen on the Bitcoin cryptocurrency as a way of bypassing economic sanctions. However, the government has now said this is not the case at all. According to the independent Iranian news ...

Posted on 21 February 2018 | 10:08 am

Crypto Nodes Are One Step Closer to Legal Protection in Arizona

The Arizona House of Representatives passed a bill protecting blockchain node operators from local restrictions.

Posted on 21 February 2018 | 10:00 am

A Computer Glitch Let a Trader Claim $20 Trillion in Free Bitcoin - Fortune


Fortune

A Computer Glitch Let a Trader Claim $20 Trillion in Free Bitcoin
Fortune
An error in the price calculation system at Japanese cryptocurrency exchange Zaif has allowed some customers to claim digital tokens for free—including one who “purchased” $20 trillion worth of Bitcoin. That's problematic on a number of levels, but ...
Glitch on Bitcoin Exchange Drops Prices to Zero Dollars, User Tries to Make Off With TrillionsGizmodo
Bitcoin Sold For Free, Briefly; Price Retreats Back Below $11000Investor's Business Daily
A Bitcoin exchange bug sees one user try to cash out $20 trillionDigital Trends
Reuters -Asahi Shimbun -Express.co.uk
all 37 news articles »

Posted on 21 February 2018 | 9:09 am

Ripple Papers Promise New Start for $40 Billion XRP Cryptocurrency

Ripple, the startup behind the world's third-largest cryptocurrency, has released two white papers that it hopes will move the technology forward.

Posted on 21 February 2018 | 9:00 am

Everything you need to know about bitcoin and your taxes - CNBC


CNBC

Everything you need to know about bitcoin and your taxes
CNBC
Bitcoin had its coming-out party in 2017. With all the excitement and opportunities around cryptcurrency, it might be easy to forget about crypto taxation. Almost every bitcoin or other "altcoin" transaction — mining, spending, trading, exchanging ...
Sorry, America, but you have to pay taxes on your bitcoin — here's howMarketWatch

all 5 news articles »

Posted on 21 February 2018 | 8:32 am

Ripple Adds 5 New Clients Across 4 Countries

Two banks and three money remittance firms across four different countries are turning to Ripple's blockchain networks for cross-border payments.

Posted on 21 February 2018 | 8:05 am

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R3 Pilots Blockchain Trade Finance Platform with Global Banks

Blockchain startup R3, trade finance tech provider TradeIX and major banks have moved their Marco Polo trade finance platform to the pilot stage.

Posted on 21 February 2018 | 7:01 am

Inside Uncle Sam's Secret Bitcoin Hoard - Fortune


Fortune

Inside Uncle Sam's Secret Bitcoin Hoard
Fortune
When Alexandre Cazes hanged himself in a Thai jail cell in July, the 25-year-old left behind the trappings of a big-league drug dealer: villas, Lamborghinis, a Porsche, bank accounts in Liechtenstein and Switzerland. But Cazes, who authorities allege ...

Posted on 21 February 2018 | 4:31 am

Customer Tries to Withdraw $20 Trillion in Crypto Exchange Glitch

A system error at a Japanese cryptocurrency exchange saw a user attempt to make off with a huge amount of bitcoin, according to reports.

Posted on 21 February 2018 | 4:10 am

Bitcoin Looks to Test $12K After Overnight Sell-Off

Bitcoin bulls remain in control, despite a sell-off overnight, and thus look set to test the long-term inflection point over $12,000.

Posted on 21 February 2018 | 3:00 am

Russia Is Leading the Push for Blockchain Democracy

Russia may not be known as a defender of democracy, but the capital city of Moscow is using an ethereum-based voting platform to change that.

Posted on 21 February 2018 | 2:00 am

Bitcoin and the Incredible Power of Fiction - Bloomberg


Bloomberg

Bitcoin and the Incredible Power of Fiction
Bloomberg
Meanwhile, the absolute gibberish that is Venezuela's cryptocurrency, the petro, which will somehow be a commodity currency and a fiat currency and a cryptocurrency, is launching today. And: "Bitcoin is becoming a 'nightmare' for divorce lawyers," not ...

and more »

Posted on 21 February 2018 | 12:01 am

Gibraltar Will Take Market-Driven Approach to ICO Rules

Top officials say Gibraltar will let the market determine what 'good' ICOs look like, and hinted that crypto investment fund regulation is to come.

Posted on 21 February 2018 | 12:00 am

Venezuela Claims $735 Million Raised in First Cryptocurrency Sale

Venezuelan president Nicolas Maduro claimed Tuesday that a presale for the country's national cryptocurrency netted $735 million on its first day.

Posted on 20 February 2018 | 9:15 pm

Tesla's Cloud Hit By Crypto Mining Malware Attack

Tesla has become the latest victim of crypto mining hacking attack, according to a report from cybersecurity software firm RedLock.

Posted on 20 February 2018 | 8:00 pm

SegWit is Coming to Coinbase and Bitfinex’s Bitcoin Exchanges

SegWit is Coming to Coinbase and Bitfinex’s Bitcoin Exchanges

Today, two of the world’s largest cryptocurrency investment platforms, Coinbase and Bitfinex, both announced that they were adopting support for Segregated Witness (SegWit) protocols for bitcoin (BTC) traded on their exchanges.

In its announcement, Bitfinex stated, “The SegWit implementation means Bitfinex users can benefit from lower BTC withdrawal fees (approximately 15 percent) and improved processing times on transactions across the Bitcoin network.” The exchange did make clear that the support for bitcoin deposits and withdrawals using pay-to-script-hash (P2SH) SegWit addresses were the only ones thus far slated for bitcoin and not applicable to bitcoin cash (BCH).

Coinbase, on the other hand, tweeted that it had finished testing for SegWit for Bitcoin. It will phase in the launch, with the goal of “targeting a 100% launch to all customers by mid next week.” Coinbase affirmed its plan for a 2018 SegWit implementation on December 15, 2017 and seemingly delivered on the SegWit statements it made on February 13, 2018.

Reasons for the support of using SegWit addresses are clear.  Prior to the activation of the Segregated Witness soft fork in August 2017, there were concerns about the scalability and malleability of Bitcoin due to the size limit of the blocks and a potential manipulation of the transaction ID. These concerns had been a source of debate for years until the “soft fork” allowed for protocol upgrades to the software.

While many hard and soft wallets already adopted support for SegWit protocols, the move by both companies is huge given the volume of bitcoin traded on each platform. At the time of this writing, both Bitfinex and Coinbase’s exchange, GDAX, accounted for nearly one tenth of global bitcoin trades over the previous 24 hours. This number underestimates the impact on BTC trading volume as it does not include Coinbase’s wallet platform. Both Bitfinex and GDAX are ranked as top 10 exchanges in the world by trading volume, at 5th and 8th, respectively.

The positive news for both exchanges comes at a time of mounting pressure from the public. Coinbase has faced community backlash on higher Bitcoin transaction fees, customers’ inability to withdraw funds to PayPal accounts and credit cards being disabled as a payment method for U.S. customers.

Bitfinex’s announcement comes on the heels of a tumultuous end to 2017 and a rough start to 2018, inclusive of new account registration issues, a CFTC subpoena and firing of auditor Friedman LLP.

With the announcements of SegWit adoption for Bitcoin, it seems that Coinbase has addressed a major issue for its consumer base, and Bitfinex has been able to release some much-needed positive news for its customers amidst its recent controversies.

For more information on Segregated Witness, check out our earlier articles on Bitcoin Magazine.


This article originally appeared on Bitcoin Magazine.

Posted on 20 February 2018 | 3:26 pm

US Securities Regulator Rejects BitConnect Records Request

The SEC has turned down a FOIA request related to BitConnect, citing an exemption commonly seen with records related to law enforcement.

Posted on 20 February 2018 | 3:15 pm

Report: Japanese Crypto Exchanges Unite to Form Self-Regulatory Group

A group of Japanese cryptocurrency exchanges is reportedly uniting to form a new self-regulatory body in the wake of the recent Coincheck hack.

Posted on 20 February 2018 | 12:45 pm

Lisk Relaunches Blockchain Project With 'Accessibility' in Mind

Lisk a decentralized application platform will relaunch today with aspirations of blockchain accessibility front and center.

Posted on 20 February 2018 | 11:45 am

Wyoming House Unanimously Approves Two Pro-Blockchain Bills

Wyoming House Unanimously Approves Two Pro-Blockchain Bills

In a watershed moment for United States blockchain and cryptocurrency law, Wyoming’s House of Representatives unanimously voted “aye” to pass two blockchain bills – HB 70 the “utility token bill” and HB 19 the “bitcoin bill” –  sending them to the State Senate for consideration. HB 70 defines utility tokens as neither traditional money nor securities; HB 19 exempts cryptocurrency from the 2003 Wyoming Money Transmitter Act (passed in the state before Bitcoin’s invention in 2008).

In an interview with Bitcoin Magazine, Wyoming Blockchain Coalition co-founder, and 22-year Wall Street veteran, Caitlin Long, attributed much of the bills’ successes so far to teamwork between Wyoming banking and security regulators and the efforts of House of Representatives member Tyler Lindholm, who is a co-sponsor and advocate of all five blockchain-related bills.

Wyoming aims to set the standard for blockchain-friendly regulation in the U.S. and to become a hub for blockchain-based innovation with these two bills. Long explained, “There are already bitcoin miners setting up shop because of [Wyoming’s] cheap electricity, no income tax and no franchise tax.”

HB 70: Utility Token Definition

The Wyoming HB 70 defines a utility token, or “open blockchain token,” as neither traditional money nor a security if it meets the following conditions:

  1. The token has not been marketed by the protocol developers as an investment opportunity.
  2. The token is exchangeable for goods or services. (This implies that protocols must offer a working product or service before tokens are issued, similar to Switzerland’s recent ICO framework.)
  3. The protocol developer has not entered into a repurchase agreement of any kind or entered into an agreement to locate buyers for the token.

Similarly, people who facilitate the exchange of an “open blockchain token” are not deemed traditional broker-dealers of securities.

HB 19: Cryptocurrency Exemption

HB 19 exempts cryptocurrency from the Wyoming Money Transmitter Act. A 2015 interpretation of this act by the Wyoming Division of Banking made it impractical for cryptocurrency exchanges to operate in the state. As a result, Coinbase suspended operations in Wyoming indefinitely in June 2015.

The passage of HB 19 moves Wyoming one step closer to cryptocurrency-friendly exchange regulation. Should the bill receive a majority vote in the Senate, exchanges such as Coinbase could resume operation in Wyoming.

Other Bills in the Pipeline

The Wyoming House of Representatives is also reviewing bills HB 101 and HB 126 in the House and SF 111 in the Senate.

HB 101, the “blockchain filings bill,” promises to update Wyoming’s Business Corporations Act to authorize the creation and use of blockchains to store records, the use of a network address to identify a corporation's shareholder and the acceptance of shareholder votes signed by network signatures.

At a high level, HB 101 specifies requirements for all corporations using electronic network or (blockchain) databases. HB 101 has passed the first reading in the House.

HB 126, the “series LLC bill” allows for the creation of “series LLCs.” This type of LLC structure is favorable towards decentralized protocols, as it enables LLCs to establish a compartmentalized series of members/managers, transferable interests or assets, and distributions to members.

HB 126 has also passed the first reading in the House.

SF 111, the “crypto property tax exemption bill,” has already been approved in the House, and its goal is to exempt cryptocurrency from Wyoming state property taxes. The bill is now awaiting consideration in the Senate.

Nothing Is Carved in Stone

While HB 70 and HB 19 have both passed in the House by a vote of 60–0, they must also pass in the Senate to be recognized as official acts.

Long expressed her optimism, while acknowledging the difficulties that lie ahead:

I don’t want to sugar-coat that it won’t be difficult. The Senate is a more uncertain chamber. But, we have incredible momentum, and all we need [for the bills to become acts] is a majority vote in the Senate.

Should the bill pass in the Senate and become an act in Wyoming, federal regulation and the SEC Howey Test could still nullify all of the advocates’ blood, sweat and tears. However, Long believes that Federal Law with regards to utility hasn’t been established yet — and, that there are people in the blockchain/cryptocurrency industry “flush with cash, interested in litigating this issue.”

Long and other Wyoming blockchain proponents hope for a final Senate outcome on HB 70, the “utility token bill,” and HB 19, the “Bitcoin bill,” as early as the middle next week.

This article originally appeared on Bitcoin Magazine.

Posted on 20 February 2018 | 9:42 am

NASA, ESA Considering Innovative Applications of Blockchain Technology

NASA, ESA Considering Innovative Applications of Blockchain Technology

NASA and other space agencies, such as the European Space Agency (ESA), are considering potential applications of blockchain technology to space missions and internal operations.

According to a NASA presentation titled “Bitcoin, Blockchains and Efficient Distributed Spacecraft Mission Control,” blockchain technology could have useful applications in distributed spacecraft missions involving multiple elements. Artificial intelligence (AI) and blockchain technologies could be further integrated to make space-based sensor networks more efficient and responsive.

In September 2017, NASA awarded a $333,000 grant to University of Akron (UA) Assistant Professor Jin Wei to research how to make space hardware smarter and more autonomous. The research program, titled “RNCP: A Resilient Networking and Computing Paradigm for NASA Space Exploration,” wants to improve the automation, environment awareness and intelligence of NASA space probes, which is an important requirement for deep space missions.

“The objective here is the application of blockchain and distributed intelligence to our space and ground network communication assets,” said Thomas Kacpura, advanced communications program manager at NASA’s Glenn Research Center. “If successful, the overall objective will be to incorporate Dr. Wei’s research in our overall portfolio to ultimately optimize our communication networks."

ESA is also quietly researching innovative blockchain-powered solutions. Recently, the Agency has been investigating the applicability of blockchain technologies to key challenges for ESA’s space activities and administrative areas. A position paper titled “Distributed Ledger Technology: Leveraging Blockchain for ESA's Success,” authored by trainee Torben David and senior coordinator Gianluigi Baldesi, offers a concise summary of blockchain technology and its main applications, and then goes on to list several potential applications to the Agency’s mission.

In particular, the paper mentions faster and more accurate payments, blockchain-based smart contracts applications to streamlining procurement, audit processes and record-keeping, data traceability and access rights, and voting and direct democracy.

It’s worth noting that the ESA paper focuses on blockchain technology applications to administrative processes but doesn’t address embedded blockchain technology for space hardware and software, which is covered by NASA’s RNCP. However, since ESA’s exploration of blockchain technology is just beginning, it seems likely that applications to space missions will be considered in due course.

In conversation with Bitcoin Magazine, Baldesi confirmed that the Agency is considering potential applications of blockchain technology with keen interest and a forward-looking approach. In the framework of “the Space 4.0 era” with diverse space actors around the world, including emerging private companies and citizen groups empowered by digital technologies, ESA launched the “Exploring Threats and Opportunities through Mega Trends in the Space 4.0 Era” initiative with the support of consulting firm Frost & Sullivan, and hosted a related workshop at the ESTEC technical centre in Noordwijk, the Netherlands, on October 23, 2017.

“In the era of Space 4.0 — as in our own lives — we have to be adaptive to change and nurture a culture of pro-activeness and open-mindedness to both disruption and opportunity,” said Baldesi.

The workshop was live-streamed and is now available for public viewing. Several presentations discuss blockchain technology as a key enabler of disruptive innovation in a wide range of industries, including space. Potential space applications of blockchain technology include  mission data; smart contracts and smart procurement to optimize the supply chain; and information management where applications may include virtual spacecraft (traceability and configuration consistency) and configuration control (hardware and documentation).

Baldesi explained that the Agency is awarding exploratory research contracts related to blockchain technology, such as a Satcom Maker Space initiative that includes Internet of Things (IoT) solutions for satellite telecommunications and a “Testbed for Blockchain supporting satellite M2M/IoT,” as well as an intended “Blockchain for Space Activities” study and an intended “fintech” initiative for innovative fintech-related applications and services based on the integration of space and non-space technology.

The governance and “direct democracy” applications mentioned in the position paper are especially interesting. Baldesi explained that the current Director General of the Agency, Johann-Dietrich Wörner, known for his vigorous support of bold, visionary initiatives such as the “Moon Village,” is determined to systematically use tools such as Kahoot for crowdsourced decision making and has launched several pilot e-voting initiatives, not only internally but also with the participation of external actors.

Blockchain-based e-voting platforms are, according to Baldesi, especially promising and in line with the desired openness and inclusiveness of Space 4.0.

These sorts of Space 4.0 citizen initiatives are growing in popularity; projects like Space Decentral project are moving in a similar direction.


This article originally appeared on Bitcoin Magazine.

Posted on 20 February 2018 | 9:33 am

Bitcoiner Faces Charges After Selling BTC to an Undercover Cop

Bitcoiner Faces Charges After Selling BTC to an Undercover Cop

On February 9, 2018, officials from U.S. Immigration and Customs Enforcement (ICE), the investigative arm of the Department of Homeland Security, arrested Morgan Rockcoons (aka “Morgan Rockwell” or “Metaballo”), CEO at Bitcoin, Inc. and an entrepreneur behind several other bitcoin startups, at his home in Las Vegas, Nevada.

Rockcoons was charged with money laundering and operating an unlicensed money transmitting business, according to court records.

According to those same records, in Southern California, between December 30, 2016 and January 8, 2017, Rockcoons allegedly exchanged around 10 bitcoin (worth around $9,200, at the time) for $14,500 in cash with an undercover law officer. That officer allegedly told Rockcoons in advance that the cash came from the manufacture and distribution of “hash oil,” which contains tetrahydrocannabinol, a controlled substance at the federal level.

Money laundering happens when a person takes ill-gotten money and turns it into “clean” money that cannot easily be tracked back to its source. Thus, if Rockcoons knew the cash was dirty, but traded it for bitcoin anyway, that would constitute money laundering.

Rockcoons was also allegedly operating an unlicensed money-transmitting business in Southern  California “from a date unknown” through August 30, 2017. Money transmitters are required to register with the Financial Crimes Enforcement Network (FinCEN).

The warrant for the arrest was issued by the Chief Magistrate for the Southern District of California on November 8, 2017, which indicates it may have taken authorities three months to track down Rockcoons, possibly because he moved out of the original jurisdiction.  

A Different Story

In private messages with Bitcoin Magazine and a series of public tweets, Rockcoons, who is actively seeking donations to pay for his legal fees, which he expects to be between $150,000 - $300,000, tells a different story than what is reflected in court records.

Where the court document says that the the cash given to him was already dirty, he claims that bitcoin he sold to the buyer became dirty after it left his hands.

“Someone bought a machine that makes cannabis oil with the BTC they purchased from me,” he said to Bitcoin Magazine. “I guess I'm not allowed to sell Bitcoin as a U.S. citizen for cash especially if [responsibility for] what people do with that money lies on me.”

In communication with Bitcoin Magazine, Rockcoons said that the buyer told him via text message that the bitcoins would be used to buy a “medical hash machine.”

He added, “Buying equipment in California is not illegal especially medical equipment in a medical State that's been a medical state for 25 years. [A] controlled substance does not have anything to do with the equipment because CBD oil can be extracted from Cannabis and that doesn't have anything to do with Tetra Hydro cannabinol.”

Both Rockcoons’ tweets and his subsequent communication with Bitcoin Magazine seemed to imply, initially, that he had no idea he was selling bitcoin to a law enforcement officer.

On Friday Feb 9, I was arrested in my home by Department Of Homeland Security over a #Bitcoin transaction from nov 2016 and am released under a personal recognizance bond. I am being charged with:

18 USC 1956 - Money Laundering Instrumenthttps://t.co/4w7NJIi4jw

Asset Forfeit pic.twitter.com/5kINtbxH17

— Morgan (@NODEfather) February 14, 2018

According to Rockcoons, the exchange took place in November 2016 (not the first week of January, as listed in court records) while he was living in Northern California (not Southern California, as the records state).

Rockcoons said the buyer found him through LocalBitcoins, an online platform that facilitates direct selling of bitcoin. A user can register as a seller on the platform and be contacted by interested parties. Transactions are done in person or via online banking.

Rockcoons claimed on Twitter that he received $9,200 for the bitcoin, though court records allege the law officer gave him $14,500. Rockoons later told Bitcoin Magazine that he specified to the buyer he wanted less than $10,000, but the buyer insisted on sending him $14,500.

“They tried to entrap me,” Rockcoons told Bitcoin Magazine. “I asked for only less than $10,000, they sent me $14500 [or] refused to send anything and then I sent under $10,000 [worth of bitcoin] to follow the law.”


After agreeing to the terms of the sale online, Rockcoons claims he received a cash payment. He described this payment, in his communication with Bitcoin Magazine, as being received in an envelope sent through the mail. He has not replied to requests for clarification as to whether or not he met with the buyer in person, though he did say that he and the buyer communicated via text messages.


At the time of the exchange, he was camping in the Mendocino National Forest, where he was living in a tent and working on a new project, a voice-operated Bitcoin wallet. Rockcoons said he had been living in the Northern California wilderness since 2015; however, fire and floods were making it increasingly difficult to survive in the area. After another fire ravaged the land, he said he needed cash for evacuation emergencies.

“I was living like a mountain man, so I didn’t really need money but eventually I needed to buy food so I decided to sell some coin; when someone asked me to buy some I usually just always turn it down but I needed cash to eat,” he told Bitcoin Magazine.

He claims the fires were what eventually forced him to move back to Nevada.

Time in Jail

After his arrest in Las Vegas on Friday, February 9, 2018, Rockcoons was locked up over the weekend in Henderson Detention Center in Clark County, Nevada, for three days. He pled not guilty at a Federal Court hearing on February 12, 2018, and was then sent to Clark County Detention Center for two more days for an unrelated charge of failure to appear on a traffic ticket.

“I was in jail for five days with some of the scariest humans on Earth,” he said. “But I [taught] most of them how Bitcoin works, so it was worth it.”   

In his series of ongoing tweets since his release from jail on February 14, 2018, Rockcoons has been portraying the charges against him as an attack on Bitcoin.

It's not my mess, it's everyone on Earths [sic] battle now or you can kiss your access to BTC goodbye,” he wrote in one tweet.

This is a attempt to redefine the regulation and the law,” he told Bitcoin Magazine.

“Bitcoin is my religion,” he wrote in another tweet. “God says I can use bitcoin everyday.”

Rockcoons is also claiming he was targeted due to his relationship with the state and the federal government and his Bitcoin-related startups.

Because of my relationship with the State & Federal Government as well as my relationship with the US military, because of my involvement in creating @BitSwitchIO at @BitcoinKinetics and possibly the opportunity to pull a @CharlieShrem case in California to get the west coast.

— Morgan (@NODEfather) February 14, 2018

He is looking to others to join the “battle” with him, and he is even asking the the Bitcoin Foundation, a non-profit organization that supports Bitcoin adoption and education, to cover 15 bitcoin (worth around $150,000) of his legal costs.

“It seems to me the Bitcoin Foundation has been absent from the Bitcoin Community during troubling times, this would be a good opportunity to show face and show the community that you're here for all of us," he tweeted.


Rockcoons’ arraignment is on February 22, 2018 at the San Diego Superior Court in California. He has hired Las Vegas criminal attorneys David Chesnoff and Richard Schonfeld to represent him. He says he plans to pay them in bitcoin.


(Note: Shortly before publishing this article, Rockcoons blocked the writer from viewing his Twitter account.)

This article originally appeared on Bitcoin Magazine.

Posted on 19 February 2018 | 3:04 pm

HashChain Technology Acquires Blockchain Company NODE40

HashChain Mining Operation Acquires NODE40 Blockchain Technology Company

HashChain Technology Inc. (HashChain) has acquired the blockchain technology company NODE40 for $8 million USD and 3,144,134 common shares of stock in HashChain (TSXV: KASH) (OTCQB: HSSHF).

HashChain is a Canadian-based crypto-mining company that currently operates 100 Dash mining rigs and is in the process of setting up nearly 4,000 more to mine bitcoin. By locating in Canada, they are able to take advantage of both the very low electrical rates for power and the cool climate for data center cooling.

Having recently gone public on the TSX Venture Exchange, the company was looking to diversify their business beyond crypto-mining and have now acquired NODE40, a company that develops Software as a Service (SaaS) products related to cryptocurrency.

HashChain CEO and Founder Patrick Gray said, “The acquisition of the NODE40 Business is an important next step of creating a global blockchain technology company."

On the hardware and mining side, NODE40 runs a managed service for running your own Dash masternode. Masternodes get paid 45 percent of the monthly block reward as incentive for providing services to the network.

On the software side, NODE40 provides the SaaS product NODE40 Balance (Balance), which determines accurate valuations for each input/output involved in a user’s transaction by using cryptocurrency transaction history and analyzing the blockchain. Once a value is assigned to each transaction, then Balance will report the users’ current total asset value, income and any realized gains or loses.

"Cryptocurrency accounting and reporting for tax purposes is a major concern in the industry at the moment,” said Gray. “The recent Coinbase subpoena from the IRS highlights the significant need for the software developed by NODE40."

The acquisition was finalized on February 15, 2018.

This article originally appeared on Bitcoin Magazine.

Posted on 19 February 2018 | 11:21 am

Op-ed: How Decentralized Protocols Are Threatening Traditional Business Models

Op-ed: How Decentralized Protocols Are Threatening Traditional Business Models

Corporates, suits and CEOs of traditional companies beware: decentralized protocols powered by blockchain technology are redefining your traditional business models, and you should be worried. Business models of the future are not created equal, and they certainly don’t play by the same rules. In the Venn Diagram of traditional business and decentralized protocols, there are a few overlaps and many differences.

Traditional Businesses vs. Decentralized Protocols

Boiled down to the most simple terms, all traditional businesses are organizations that charge customers a certain price (usually denoted in fiat currency) in exchange for a certain product or service. Starbucks charges $3.28 for a quad, grande, decaf Americano. Netflix charges a monthly $10.99 for unlimited Nicolas Cage streaming. Lover’s charges $20 to “spice things up” in the bedroom.

Ultimately, all traditional businesses –– no matter the product or service –– are driven by the quest for profit. Business owners are incentivized to reduce costs, increase efficiencies and scale carefully to maximize cash flows for shareholders.

The key stakeholders of traditional business are customers, business owners/employees and business financiers.

A decentralized protocol powered by blockchain technology is a network — a network framed by cryptography, distributed ledger technology, decentralization and consensus methods –– but a network nonetheless. The networks created by decentralized protocols aren’t structured like the networks created by any traditional business model.

Decentralized protocols aren’t driven by the need to create future cash flows for shareholders. Instead, they are programmed to facilitate commercial interactions between humans in a frictionless manner. A protocol’s incentives are aligned to benefit users and to achieve the smallest margins possible.

The key stakeholders of decentralized protocols are customers, protocol “community maintainers” and (occasionally) protocol financiers.

Customers

Customers benefit from the traditional business they choose to interact with. For a price specified by the business (in fiat currency), they are entitled to a product or service.

Similarly, customers benefit from the protocol they choose to interact with. For a price specified by the protocol, they are entitled to a product or service.

Generally, protocols are powered by utility tokens. For example, the fictional Planes Protocol facilitates coast-to-coast trips in a Tesla-of-the-skies (electric planes) for 1 PLN token. The PLN token is a medium-of-exchange. Nick, a businessman from Seattle, must pay 1 PLN token for a flight from Seattle to Miami. The plane operator is entitled to 99 percent of the PLN token fee and the Planes Protocol claims the other 1 percent.

Business Owners and Employees

Traditional business owners and employees must be compensated for their work. After all, there is a price to pay for food, water and shelter. Business owners pay themselves with portions of their revenue and pay their employees salaries for their work.

Because protocols are decentralized, the concept of “business owner” does not apply. Instead, protocols are cultivated by those designated as “community maintainers.” Whether the protocol founder is designated as the “community maintainer” is up to the community.

Protocols can facilitate commercial interactions between humans “at cost,” as long as they are generating enough in network fees to cover all required upkeep costs. For example, these can include a centralized unit to guarantee customer satisfaction and hiring of developers, project managers or anyone else necessary to keep the network alive and well. Therefore, a protocol’s margins can be much lower than that of a traditional business.

If a “greedy” protocol is programmed with transaction fees that are unreasonably high, anyone can “fork” the protocol (by using a modified copy of the original open-source code) and create a competing network with lower transaction fees. This will continue until price reaches a near-free equilibrium.

Protocol founders can reward themselves with a certain percentage of all tokens ever minted for creating the protocol; similarly, “community maintainers” are rewarded for their efforts via the protocol’s tokens on an ongoing, salary-style basis. These tokens usually have a related fiat value and can be redeemed on publicly traded exchanges.

Side note: Utility tokens are not a panacea. They face various problems such as publicly traded speculation and token velocity. A utopian, token-centric future will not happen overnight. There is much work to do.

Business Financiers

Many business owners or entrepreneurs traditionally rely on risk-tolerant financiers with capital. In the 1500s, enterprising trade voyagers relied on wealthy financiers to support their journeys. If trade voyagers were successful, financiers earned the lion’s share of the voyagers’ profits.

In 2018, Silicon Valley startup founders relinquish equity/control over their company to venture capitalists (modern day trade financiers) in exchange for seed funding. If startups are successful, venture capitalists earn a return proportional to their shares of the company.

It is important to note that capitalism and traditional business models work well. There are millions of happy customers across a variety of industries. But, in some cases, decentralized protocols provide cheaper access to products or services and better-aligned incentives for all stakeholders.

Founders of protocols have flexibility. Because they are creating a new network powered by utility tokens, they can afford to bypass traditional debt/equity financing.

While 16th century merchants and past Silicon Valley founders played by the rules of their financiers, founders of decentralized protocols are freed from this sort of pressure. Protocols can crowdfund capital by pre-selling their protocol’s utility tokens to accredited VCs and, in some cases, to the general public. Protocols can also give discounted tokens to developers for their skills.

Key Takeaway: Traditional businesses and protocols are not created equal. And decentralized protocols certainly don’t play by the same rules as traditional businesses.

Shifting the Value Paradigm

So, what might value creation in the future even look like? And how does a legacy business survive the decentralized future?

Corporate decision-makers must recognize and understand that:

  • This is a true instance of the often-overlooked “past performance is no guarantee of future results.” Traditional business models cannot be confused with or compared to protocols of the future.
  • Decentralized protocols of the Web 3.0 will not automatically dethrone legacy businesses. And, in some cases, traditional business would not benefit from decentralization. Protocols will not gain the necessary network effects for widespread adoption unless their value proposition is an order of magnitude better than current business models.
  • If your corporation operates on the basis of artificial scarcity or “middlemen economics,” you’re ripe for disruption.

Most decentralized protocols still require certain aspects of centralization to guarantee customer satisfaction. Sorry, libertarians, but certain things must maintain a degree of centralization.

Practical Example: Uber vs. Ride, a Fictional, Decentralized Ride-Sharing Protocol.

In 2018, Uber has 3 key competitive advantages in the ride-sharing market:

  1. Legacy Network: ~ 40 million total monthly, active riders; ~ 1.5 million total drivers
  2. Customer Satisfaction Guarantee: a centralized company able to provide riders/drivers with personalized troubleshooting. For example, when a driver complains that a college student threw up in his Uber, the centralized Uber troubleshooting authority reprimands the rider in the form of a citation and makes the driver whole.
  3. Brand Name Recognition: Uber has achieved ultimate “verb” status. On par with “Googling” something.

However, in 5–20 years, Ride will inevitably come along and attempt to win over Uber’s users and drivers. Ride won’t be structured like Uber’s traditional business model. Its goal won’t be to create future cash flows for Ride shareholders. Instead, the protocol will focus on facilitating transactions between riders and drivers in a frictionless, decentralized manner. Ride’s incentives will be aligned to benefit riders and drivers.

Because Ride isn’t driven by the quest for profit, it doesn’t have to charge drivers ~20 percent for each ride. Instead, they can charge users/drivers fractional transaction fees (by means of the RIDE utility token) for interacting with the protocol. These transaction fees are used to maintain and secure the Ride protocol.

The Ride protocol will raise money by pre-selling their utility tokens via decentralized crowdfunding. The protocol will provide an order of magnitude improvement over Uber’s network, executed by the right team and the right investors. Because of this, Ride will amass a significant network effect, user base and brand name recognition. Of course, the Ride protocol will likely still have aspects of centralization to provide customer satisfaction.

So, How Can Companies Like Uber Survive in 2025?

There are two options:

  1. “Reverse ICO,” or create a decentralized protocol for the service you provide.
  2. Slowly go bankrupt as market share is taken away by your competitors, who are decentralized protocols.

Decentralization will be just one of many difficult topics to bring up at a board meeting. After all, artificial intelligence and automation are advancing every year. Shrinking margins, employee layoffs and re-trainings are also implicit with decentralization. (Maybe it’s best to recruit your interns to volunteer this information to the board, in case this inevitability isn’t well-received by your shareholders.)

Legacy companies are presented with an incredible opportunity to participate in the next evolution of business models and commercial interactions between people. Choose to embrace the future or fall as a victim to social darwinism: the choice is up to you.

This is an opinion piece by Erik Kuebler. The views expressed are his own and do not necessarily reflect those of BTC Media or Bitcoin Magazine.

This article originally appeared on Bitcoin Magazine.

Posted on 19 February 2018 | 10:03 am

Sidechains: Why These Researchers Think They Solved a Key Piece of the Puzzle

Sidechains and Why These Researchers Think They Solved a Key Piece of the Puzzle

New blockchains are born all the time. Bitcoin was the lone blockchain for years, but now there are hundreds. The problem is, if you want to use the features offered on another blockchain, you have to buy the tokens for that other blockchain.

But all that may soon change. One developing technology called sidechains promises to make it easier to move tokens across blockchains and, as a result, open the doors to a world of possibilities, including building bridges to the legacy financial systems of banks.

In October 2017, Aggelos Kiayias, professor at the University of Edinburgh and chief scientist at blockchain research and development company IOHK; Andrew Miller, professor at the University of Illinois at Urbana-Champaign; and Dionysis Zindros, researcher at the University of Athens, released the paper “Non-Interactive Proofs of Proof-of-Work” (NiPoPoW), introducing a critical piece to the sidechains puzzle that had been missing for three years. This is the story of how they got there.

But, first, what exactly is a sidechain?    

Same Coin, Different Blockchain

A sidechain is a technology that allows you to move your tokens from one blockchain to another, use them on that other blockchain and then move them back at a later point in time, without the need for a third party.  

In the past, the parent blockchain has typically been Bitcoin, but a parent chain could be any blockchain. Also, when a token moves to another blockchain, it should maintain its same value. In other words, a bitcoin on an Ethereum sidechain would remain a bitcoin.  

The biggest advantage of sidechains is that they would allow users to access a host of new services. For instance, you could move bitcoin to another blockchain to take advantage of privacy features, faster transaction speeds and smart contracts.  

Sidechains have other uses, too. A sidechain could offer a more secure way to upgrade a protocol, or it could serve as a type of security firewall, so that in the event of a catastrophic disaster on a sidechain, the main chain would remain unaffected. “It is a kind of limited liability,” said Zindros in a video explaining how the technology works.

Finally, if banks were to create their own private blockchain networks, sidechains could enable communications with those networks, allowing users to issue and track shares, bonds and other assets.

Early Conversations

Early dialogue about sidechains first appeared in Bitcoin chat rooms around 2012, when Bitcoin Core developers were thinking of ways to safely upgrade the Bitcoin protocol.

One idea was for a “one-way peg,” where users could move bitcoin to a separate blockchain to test out a new client; however, once those assets were moved, they could not be moved back to the main chain.  

“I was thinking of this as a software engineering tool that could be used to make widespread changes,” Adam Back, now CEO at blockchain development company Blockstream, said in an interview with Bitcoin Magazine. “You could say, we are going to make a new version [of Bitcoin], and we think it will be ready in a year, but in the meantime, you can opt in early and test it.”

According to Back, sometime in the following year, on the Bitcoin IRC channel, Bitcoin Core developer Greg Maxwell suggested an idea for a “two-way peg,” where value could be transferred to the alternative chain and then back to Bitcoin at a later point.

A two-way peg addressed another growing concern at the time. Alternative coins, like Litecoin and Namecoin, were becoming increasingly popular. The fear was these “altcoins” would dilute the value of bitcoin. It made sense, Bitcoin Core developers thought, to keep bitcoin as a type of reserve currency, and relegate new features to sidechains. That way, “if you wanted to use a different feature, you wouldn’t have to buy a speculative asset,” said Back.

To turn the concept of sidechains into a reality, Back along with Maxwell and a few other Bitcoin Core developers formed Blockstream in 2014. In October that year, the group released “Enabling Blockchain Innovations with Pegged Sidechains,” a paper describing sidechains at a high level. Miller appears as a co-author on that paper as well.

How Sidechains Work

One important component of sidechains is a simplified payment verification (SPV) proof that shows that tokens have been locked up on one chain so validators can safely unlock an equivalent value on the alternative chain. But to work for sidechains, an SPV proof has to be small enough to fit into a single coinbase transaction, the transaction that rewards a miner with new coins. (Not to be confused with the company Coinbase.)

At the time the Blockstream researchers released their paper, they knew they needed a compressed SPV proof to get sidechains to work, but they had not yet developed the cryptography behind it. So they outlined general, high-level ideas.

The Blockstream paper describes two types of two-way pegs: a symmetric two-way peg, where both chains are independent with their own mining; and an asymmetric two-way peg, where sidechain miners are full validators of the parent chain.

In a symmetric two-way peg, a user sends her bitcoins to a special address. Doing so locks up the funds on the Bitcoin blockchain. That output remains locked for a contest period of maybe six blocks (one hour) to confirm the transaction has gone through, and then an SPV proof is created to send to the sidechain.

At that point, a corresponding transaction appears on the sidechain with the SPV proof, verifying that money has been locked up on the Bitcoin blockchain, and then coins with the same value of account are unlocked on the sidechain.

Coins are spent and change hands and, at a later point, are sent back to the main chain. When the coins are returned to the main chain, the process repeats. They are sent to a locked output on the sidechain, a waiting period goes by, and an SPV proof is created and sent back to the main blockchain to unlock coins on the main chain.  

In an asymmetric two-way peg, the process is slightly different. The transfer from the parent chain to the sidechain does not require an SPV proof, because validators on the sidechain are also aware of the state of the parent chain. An SPV proof is still needed, however, when the coins are returned to the parent chain.

Search for a Compact Proof

In a sidechain, a compact SPV proof needs to contain a compressed version of all the block headers in the chain where funds are locked up from the genesis block through the contest period, as well as transaction data and some other data. In this way, an SPV proof can also be thought of as a “proof of proof-of-work” for a particular output.

Inspiration for the compact SPV proof comes from a linked-list-like structure known as a “skip list” developed 25 years ago. In applying this structure to a compact SPV proof, the trick was in finding a way to skip block headers while still maintaining a high level of security so that an adversary would not be able to fake a proof.

In working through the problem, Blockstream showed an early draft of its sidechains paper to Miller, who had been mulling over compact SPVs for a few years already.

In August 2012, in a post on a BitcoinTalk forum titled “The High-Value-Hash Highway,” Miller described an idea for a “merkle skip list” that a Bitcoin light client could use to quickly determine the longest chain and begin using it. In that post, he described the significance of the data structure as “absolutely staggering.”

When Miller read through the Blockstream draft, he spotted a vulnerability in the compact SPV proof described in the paper. Discussions ensued, but they “couldn’t find a way to solve that problem without compromising efficiency,” Miller said.

Miller’s non-trivial contributions to the Blockstream paper ended up being a few paragraphs in Appendix B that describe the challenges in creating a compact SPV proof.

It should “be possible to greatly compress a list of headers while still proving the same amount of work,” the section reads, but “optimising these tradeoffs and formalising the security guarantees is out of scope for this paper and the topic of ongoing work.”

That ongoing work remained stuck for three years.

Making It Non-interactive

During that ensuing time, researchers at IOHK began taking a more serious interest in sidechains. Plans were taking shape for Cardano, a new proof-of-stake blockchain that IOHK had been contracted to build.

Cardano would consist of two layers: a settlement layer, launched in September 2017, where the money supply would be kept, and a smart contract layer. Those two layers would be two sidechain-enabled blockchains. In this way, the settlement could remain simple and secure from any attacks that might occur on the smart contract layer. But if IOHK was to get Cardano to work as intended, it needed to solve sidechains.

In February 2016, Kiayias, then a professor at the University of Athens, and two of his students, Nikolaos Lamprou and Aikaterini-Panagiota Stouka, released “Proofs of Proofs of Work with Sublinear Complexity” (PoPoW).

The paper was the first to formally address a compact SPV proof. Only, the proof described in the paper was interactive; whereas, to work for sidechains, it needed to be non-interactive.

In an interactive proof, the prover and the verifier enter into a back-and-forth conversation, meaning there could be more than one round of messaging. In contrast, a non-interactive proof would be a simple, short string of text that would fit neatly into a single transaction on the blockchain.

The PoPoW paper was presented at BITCOIN’16, a workshop affiliated with the International Financial Cryptography Association’s (IFCA) Financial Cryptography and Data Security conference. Miller, who was at the conference, approached Kiayias and shared an idea for making the protocol non-interactive.

It was a “nice observation,” Kiayias told Bitcoin Magazine, but making the proof secure was “not obvious at all” and would require significant work.

Zindros, who had just started working on his PhD under Kiayias, was also at the conference, and he needed a topic for his thesis. Kiayias saw a good fit, “so we pressed on, the three of us, and adapted the PoPoW protocol and its proof of security to the non-interactive setting,” Kiayias said.

In October 2016, Kiayias officially joined IOHK, and a year later, Kiayias, Miller and Zindros released “Non-Interactive Proofs of Proof-of-Work,” introducing a compact SPV proof five years after sidechains had first been talked about on Bitcoin forums.

“If it were interactive, I don’t know if it would have worked; with a non-interactive proof, it is really smooth,” Zindros told Bitcoin Magazine.

More Work to Be Done

Even with NiPoPoW, sidechains are still not fully specified. Several questions remain, including, how small can the proofs be made? After a transaction is locked up on one chain, how much time needs to pass before it can be spent on the other? And, will it be possible to move a token from a sidechain directly to another sidechain?

“A lot of theory still needs to be defined,” IOHK CEO Charles Hoskinson said in speaking to Bitcoin Magazine.

Also, while NiPoPoW is designed to work for proof-of-work blockchains, some believe that if blockchains are to take their place in the world on a grand scale, the future rests in proof-of-stake protocols like Ouroboros, Algorand or Snow White, which promise to be more energy-efficient than Bitcoin.

In particular, if Cardano, which is based on Ouroboros, is to work according to plan, IOHK researchers still need to discover a non-interactive proof of proof-of-stake (NiPoPoS).

Hoskinson is confident. “We can definitely do that,” he said. “We can definitely have a NiPoPoS. The question is how many megabytes or kilobytes is it going to be? Can we bring it down to 100 KB? That is really the question.”

This article originally appeared on Bitcoin Magazine.

Posted on 19 February 2018 | 7:12 am

Swiss Regulator Gives Clear Guidelines for Launching ICOs

Swiss Regulator Gives Clear Guidelines for Launching ICOs

On February 16, 2018, the Swiss Financial Market Supervisory Authority FINMA put the world on notice by being the first major economy to set out clear guidelines on initial coin offerings (ICOs). In an announcement, the Swiss regulator addressed plans to apply financial market legislation to different tokens as well as lay out how ICO organizers can get proper input from FINMA when planning or launching their initial coin offerings.


The guidelines, offered as a downloadable PDF, show market participants what information is needed to help the Swiss regulator adequately address all issues presented in inquiries to the regulator, as well as how FINMA intends for current financial market legislation to be applied to ICOs. The published guidelines are intended to complement FINMA Guidance 04/2017, which in September 2017 addressed regulatory treatment of initial coin offerings.  

Important to note is FINMA’s concern over creating transparency. According to the regulator, “Creating transparency at this time is important given the dynamic market and high level of demand.”

FINMA also cited an increase in the number of inquiries corresponding with a sharp increase in the quantity of planned and executed ICOs in the country as a motivating factor for the move.

The regulator’s concern over transparency is clearly illustrated when they state in the guidelines that “ICOs raise a variety of legal issues for which there is no relevant case law and no consistent legal doctrine. Given the wide variety of types of token and ICO set-ups, it is not possible to generalise. Circumstances must be considered holistically in each individual case.”

The press release on the guidelines also provides useful information. The Swiss regulator highlighted that they would focus “on the underlying purpose of the tokens” and that the tokens were “tradeable and transferable.”

The release also showed how FINMA categorizes the tokens into three types — payment tokens, utility tokens and asset tokens (allowing for tokens to possibly take on aspects of more than one group) — and ascribes definitions for organizers to better understand their tokens’ potential assessment.  

Another major emphasis in the press release was on the guidelines’ role in displaying how FINMA will handle ICO inquiries regarding Anti-Money Laundering (AML) and securities regulations compliance. In the release, they referred market participants to the diagram on page 8 of the guidelines (as shown below), which distinguishes the regulator’s stance based on which of the three categories the tokens are put in.

Swiss Regulator Gives Clear Guidelines for Launching ICOs chart

While the press release does finish with a note to investors about the risks associated with investing in ICOs, the most important part of the announcement is the portion where FINMA highlights the “innovative potential” of blockchain technology. In it, FINMA CEO Mark Branson stated:

The application of blockchain technology has innovative potential within and far beyond the financial markets. However, blockchain-based projects conducted analogously to regulated activities cannot simply circumvent the tried and tested regulatory framework. Our balanced approach to handling ICO projects and enquiries allows legitimate innovators to navigate the regulatory landscape and so launch their projects in a way consistent with our laws protecting investors and the integrity of the financial system.

While regulations on ICOs are either ambiguously evolving or demonstrating outright hostility in other countries, FINMA has given a clear signal that it wants to provide transparency, open communication and certainty (where possible) to those launching ICO projects within the Swiss Confederation.

This article originally appeared on Bitcoin Magazine.

Posted on 16 February 2018 | 4:20 pm

Bitcoin price climbs over $4,000

Posted on 14 August 2017 | 1:16 am

Bitcoin reaches new all-time high: $3,000

Posted on 12 June 2017 | 1:06 am

CRYENGINE now accepts Bitcoin

Posted on 29 March 2017 | 1:24 am

Consulting firm EY Switzerland accepts Bitcoin

Posted on 26 November 2016 | 12:47 am

Bitcoin Trading Bots

There have been a wide variety of situations in which algorithmic trading programs have proven to be beneficial for investors. However, investors who only trade a cryptocurrency can also take advantage of bitcoin trading bots. Through bitcoin bot trading, traders can become more flexible and prompt, minimize errors and process information more rapidly. At this… Read More »

Posted on 8 November 2016 | 6:20 pm

Steam accepts Bitcoin

Posted on 29 April 2016 | 1:09 am

Major Magazine Publisher to Accept Bitcoin Payments

Posted on 18 December 2014 | 12:43 pm

Mozilla accepting Bitcoin

Posted on 20 November 2014 | 1:55 pm

PayPal and Virtual Currency

Posted on 23 September 2014 | 9:52 pm

Wikimedia Foundation Now Accepts Bitcoin

Posted on 30 July 2014 | 3:14 pm

German Newspaper "taz" accepts Bitcoin

Posted on 22 July 2014 | 1:32 pm

airBaltic - World’s First Airline To Accept Bitcoin

Posted on 22 July 2014 | 11:03 am

February 21, 2018 -
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