Analysis: Here’s Why JP Morgan Is Launching Its Own Centralized Crypto Asset

Jamie Dimon, the chief executive of JP Morgan Chase, has long been a skeptic of cryptocurrencies, especially Bitcoin. After calling the flagship crypto asset a “fraud,” remarking that it’s much worse than the tulip bulb bubble of yesteryear, Dimon remarked that he doesn’t give a single sh*t about the project.
But, in a jaw-dropping turn of events, Dimon’s firm revealed that it would be diving head first into the blockchain space on Thursday. While some yelled hypocrite, as Dimon’s comments remain fresh in crypto enthusiasts’ minds, there may be a logical reason for the firm’s seemingly sudden 180°.
(Private) Blockchain Tech Is A Money Saver For Banks
For those who missed the memo, on Thursday morning, JP Morgan revealed to CNBC that it would be launching the so-called “JPM Coin.” This digital asset, which will initially run on top of Quorum, the bank’s private Ethereum-based ecosystem, is slated to become a stablecoin that will solely be transacted with the corporation’s walls.
In a comment to CNBC, Umar Farooq, the head of JP Morgan’s blockchain division, explained that a “tiny fraction” of the institution’s $6 trillion in corporate transactions would be made through JPM Coin. Farooq didn’t explain what the fraction would equate to, but as it stands, it is unlikely that the bank is poised to transact billions on their nascent centralized blockchain.

While many pundits have argued that the use of a centralized blockchain is inefficient, especially considering that tokens based upon such an ecosystem are 100% subject to the whims of fallible entities, the company may have a good reason for not heeding by Dimon’s word.
Long story short, the company, just like a good majority of other Wall Street bigwigs, wants to minimize costs through any means. While JPM Coin hasn’t been proven in the field, projects of similar caliber employed by other banks have seen some success.
HSBC’s Mark Williamson recently told Reuters that it has been saving a copious amount of trading costs due to its up-and-coming company blockchain. The chief operating officer of HSBC’s forex trading arm purportedly explained that blockchain-enabled transactions made on HSBC’s so-called “FX Everywhere” system were 25% than traditional methods. While HSBC’s offering doesn’t involve an in-house crypto asset, the premise is somewhat similar, meaning that extrapolating cost savings isn’t entirely illogical.
Thus, while Dimon still seems to be convinced that Bitcoin and other crypto assets aren’t fine and dandy, JP Morgan’s blockchain division are likely looking at green boxes in their books, rather than the morals of JPM Coin.
Funny enough, this newfangled digital asset comes after the Wall Street institution released a foreboding report regarding the long-term prospects of cryptocurrencies. Though, the firm’s research division was bullish on blockchain technology and similar innovations. Per previous reports from this outlet, JP Morgan’s researchers wrote that Bitcoin is only best used in a dystopian world, one where fiat currencies and traditional banks are all but dust.
Regardless, Crypto Community Still Detests JPM Coin
Although JP Morgan’s attempt to bolster its bottom line is commendable from an economic perspective, much of the crypto community lambasted the organization for its cryptocurrency project.
As reported by NewsBTC just hours after the jaw-dropping news broke, industry diehards came out in force to lambast JPM Coin. Alec Ziupsnys, better known as Rhythm Trader, noted that the company’s venture isn’t much of a “cryptocurrency.” WhalePanda echoed this sentiment, quipping that the new product is a “useless sh*tcoin.”
But these quips were just the tip of the iceberg, as a mass of crypto commentators took to their Twitter feeds en-masse to bash the institutions’ audacity to introduce the umpteenth stablecoin, one that is entirely centralized no less.
Anthony Pompliano, an anti-establishment figure that heads Morgan Creek Digital, joked that the “most popular token for money laundering this year” will be JP Morgan’s very own asset, likely referencing the fact that Bitcoin is barely used for “cleaning cash,” if at all.

The most popular token for money laundering this year will be JPM Coin
— Pomp (@APompliano) February 14, 2019

Brad Garlinghouse, the chief executive of Ripple Labs, also had something to say about the offering. In a Twitter comment that garnered some semblance of support of both the XRP and Bitcoin community, the fintech guru explained that JP Morgan’s sudden launch of a digital asset is like launching “AOL after Netscape’s IPO.” This is, of course, in reference to the earliest Internet browsers at the commencement of the first notable Dotcom boom and bust cycle.
Related Reading: Dotcom Bubble Burst May Have Been Necessary; What About Crypto?
Even Bitcoin Nouriel “Dr. Doom” Roubini, a professor at Stern School at New York University, had some laudable choice words for JP Morgan’s newest venture. Roubini, who has claimed that Bitcoin will go to $0 on multiple occasions, explained that JPM Coin is far from the public, permissionless, and decentralized nature that cryptocurrencies are best known for.

In which way has the new alleged JPMorgan crypto coin anything to do with blockchain/crypto? It is private not public, permissioned not permissionless, based on trusted authorities verifying transaction not trustless, centralized not decentralized. Calling it crypto is a joke
— Nouriel Roubini (@Nouriel) February 14, 2019

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Will Bitcoin Block Size Reduction Argument Cause Another Crypto Conflict?

Things have been busy in crypto land this week and the big debate over Bitcoin’s block size has only just been usurped by JP Morgan’s attempt to launch its own completely centralized crypto coin. The block size issue is an important one so we’ll delve a little deeper into that.
Another Crypto Conflict Imminent?
Bitcoin Core, the enigmatic code that runs the world’s largest decentralized currency, has a highly calibrated and specific set of instructions and protocols. Any attempt to deviate from them is usually met with brimstone and fire from the developers and community. When they disagree a hard fork usually occurs and there have been a lot of them over Bitcoin’s short ten year lifespan.
The highly controversial proposal discussed this week came from Core developer Luke Dashj who suggested decreasing the size of the blocks from their current 1Mb to 300Kb. In theory this may increase adoption by reducing costs associated with network participation.

Another example: This patch would enforce a very simple softfork, reducing #Bitcoin block sizes to ~300k between Aug 1 and Dec 31. It demonstrates how one can make a truly TEMPORARY softfork.https://t.co/sukdk2zJpR
(DO NOT RUN THIS IN PRODUCTION EVEN IF YOU SUPPORT A UASF)
— Luke Dashjr (@LukeDashjr) February 7, 2019

Since the Bitcoin network has grown so large now (over 200Gb) running a full node, which stores and updates a copy of the entire blockchain, is extremely resource intensive and costly. The reduction in block size would alleviate these expenditures but would require the majority to move to a soft forked version of the existing BTC chain.
The decentralization case is a strong one; if data centers are required to run full nodes then the network effectively becomes centralized. Blockstream’s strategy chief Samson Mow told Hard Fork;
“This is also why most Bitcoin users do not want huge blocks, because then full nodes could only be run in data centers, which perfectly defeats the purpose of having a decentralized network,”
Some of the community have backed this notion and still advocate for a smaller block size to reduce the potential centralization of running full nodes. The counter argument is that this ‘minor tweak’, as some have described it, will result in a huge disruption to a well-functioning system.  The demise of Bitmain has already reduced centralization concerns and smaller blocks would be of greater benefit to miners who can earn more from transaction fees. The crypto community on twitter has also had their say as the debate rages on;

The crypto community is tired of being tortured by a Bitcoin that refuses to scale and remains in constant limbo. Live or die: scale or go off-chain, huge blocks or teeny ones. This is crypto fatigue. Just get it over with, and deal with what happens. https://t.co/lI8RPPBwJD
— Joel Valenzuela (@TheDesertLynx) February 13, 2019

Bitcoin guru John Carvalho added; “Right now, there isn’t a lot of support for [block size] adjustment ideas because many see it as a controversial and sore topic. We all still feel the bruises from the Segwit2x/No2x/BCash debates,”
There has also been a big push to the Lightning Network which could be affected as proponents of the recently forked Bitcoin SV noted;

I'm shocked the core devs want to reduce the block size from 1MB to only 300KB.
I'm flabbergasted!
Do they not understand along with killing mainnet adoption they're also killing LN adoption???
How the fuck are you going to onboard billions of people if you shrink???#Bitcoin
— Mike Relentless [SV] (@mikerelentless) February 13, 2019

The most pertinent comment though highlights that infighting such as this can only cause longer term damage to Bitcoin and the entire ethos of decentralized currencies;

Stop this madness! Last thing Bitcoin needs is yet more contentious forks in this key year for adoption! A soft fork to "reduce the block size" is a hard fork in all but name. This will split off from the established consensus, cause massive drama, and damage trust in Bitcoin. https://t.co/54tzz4UIli
— Cøbra (@CobraBitcoin) February 11, 2019

Changes to the established code and network are always a hot potato in the crypto world, and block size is top of that tree. Bitcoin has a long way to go before it can truly be considered autonomous and decentralized and these debates are part of that evolution process for the nascent technology. However, with markets battered and bruised, another public crypto conflict between rival factions will cause more damage than good in the short term for Bitcoin and its brethren.
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Researcher: Bitcoin Lightning On Square Could Be Bigger Than Crypto ETF, Bakkt Combined

Although many industry insiders talk a big game about the real world viability of Bitcoin, as it stands the cryptocurrency has seen little adoption. In fact, it has been anecdotally said that the number of brick and mortar merchants accepting BTC has plummeted, not risen over the past years.
Yet, this could change soon, as one of the most popular mobile applications in the U.S. was revealed to be slated to double-down on its in-house Bitcoin offering. Some have even argued that the integration could single-handedly propel this industry to new heights.
Related Reading: Analysts Applaud Square’s Bitcoin Strategy as Brilliant Despite Low Profitability
Twitter CEO Continues Bitcoin Crusade
In the past two weeks, Jack Dorsey, the chief executive of both Twitter and Square, has risen to monumental status in the cryptosphere. While he made brief comments about his enamorment with Bitcoin in early-2018, he went full evangelist in early-February, as he extensively touted the merits of an Internet-centric decentralized currency. On Joe Rogan’s Youtube podcast, the Silicon Valley guru claimed that the battle-tested Bitcoin could easily become the native currency of the entire Internet ecosystem.

Bitcoin is resilient. Bitcoin is principled. Bitcoin is native to internet ideals. And it’s a great brand.
— jack (@jack) February 5, 2019

He expressed a similar sentiment on Twitter. In fact, Dorsey made over 100 tweets regarding cryptocurrencies in a rant-esque fashion. Per previous reports from this outlet, the Bay Area native mentioned that Bitcoin is resilient, principled, native to the ideals of the Internet, and a great brand, in spite of cynics’ cries.
While this was jaw-dropping in and of itself, Dorsey made mention of his advocacy for the Lightning Network. In response to a tweet that outlined an idealistic system where people can tip satoshis for tweets (enabled via Lightning), the American entrepreneur noted that he “loves the idea.”
This one-liner, while innocuous in practically any other context, quickly catalyzed rumors that Dorsey’s Square, a fintech company with a higher valuation that Twitter, was hard at work on incorporating Lightning into its services.

Cool example of #BitcoinTwitter experimenting on the Lightning Network.
Torch received, now passing along to @starkness! #LNtrustchain https://t.co/YVMAv62fCN
— jack (@jack) February 5, 2019

Just days later, he took to Bitcoin bull Stephan Livera’s podcast to confirm these rumors. During the podcast, which also saw Lightning Labs chief executive Elizabeth Stark make an appearance, the Twitter CEO explained that Square’s integration of the scaling protocol is a matter of “when,” not “if.” Speaking on the rationale of eventually making such a move, Dorsey explained that his firm’s raison d’etre is to serve customers best, with Lightning only accentuating this goal.

He added that Square sees Bitcoin’s underlying nature as a currency, rather than solely a speculative asset. And as it stands, the widespread adoption of the Lightning Network is the most promising means to get to that end.
How Big Would Bitcoin Lightning On Square Be?
While Dorsey’s comments regarding his fintech upstart’s plans to integrate the Lightning scaling solution were open-ended, the magnitude of the future move was quickly comprehended.
Alec Ziupsyns, better known as RhythmTrader on Twitter, claimed that whatever form the integration takes, it will likely have a larger impact on the Bitcoin ecosystem than both Bakkt and a crypto ETF. This comment may have caught investors off-guard, especially considering the ever-growing thought process that a fully-launched Bakkt will be the startup to wrench Bitcoin out of this 12-month “crypto nuclear winter.”

Jack Dorsey says Lightning Network coming to Square's Cash App is a "when", not "if".
This will have a larger impact on bitcoin adoption than both Bakkt and an ETF.
The launch of the Bitcoin Network in 2009 was a global earthquake.
Now is time for the tsunami.
— Alec Ziupsnys (@AlecZiupsnys) February 11, 2019

Ziupsnys, who likened the initial launch of the Bitcoin Network to a global earthquake, added that the next phase of the asset’s life, which will involve Square’s Bitcoin offering, will be much like the subsequent tsunami.
Other industry insiders echoed Ziupsyns’ quip. In an interview with Tim Copeland of Decrypt Media, Jeremy Welch, the chief executive of Bitcoin hardware and software provider Casa, noted that Square’s (and Twitter by extension) support for Lightning would simply be “huge.” Welch explained that as Square is a “very well respected company,” with “great tech, great teams,” it’s doubling down on Bitcoin would be significant for both adoption and reputation. The entrepreneur explained:
“Silicon Valley hasn’t had the best view on Bitcoin overall. So, it would be significant on multiple levels, both in terms of adoption and their reputation and they have cachet with a lot of the bigger financial institutions.”
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Google Enters Crypto and Blockchain Search Business With New Tools

A new raft of crypto and blockchain analytics tools has just been launched by search giant Google. They will provide deep data sets for the top cryptocurrencies and aim to revolutionize blockchain search as the company did for information on the internet.
Six New Blockchain Datasets Added
Over the past year Google Cloud has released blockchain transaction history datasets for Bitcoin and Ethereum. Yesterday the company announced the release of six more datasets in addition to a deeper set of queries that enables multi-chain meta-analyses and integration with conventional financial record processing systems.
The six new blockchain datasets just released are Bitcoin Cash, Dash, Dogecoin, Ethereum Classic, Litecoin, and Zcash. Google Cloud developer Allen Day told Forbes;
“I’m very interested to quantify what’s happening so that we can see where the real legitimate use cases are for blockchain. So people can acknowledge that and then we can move to the next use case and develop out what these technologies are really appropriate for.”
The company blog went on to explain that five of these particular crypto assets (BCH, LTC, DASH, ZEC and DOGE) have been chosen ‘because they all have similar implementations, i.e., their source code is derived from Bitcoin’s.’ The sixth one, ETC, is based on Ethereum – or as many will correct – is the original Ethereum blockchain. All datasets will update every 24 hours via a common codebase, the Blockchain ETL  (extract, transform, load) ingestion framework, which will enable real time streaming transactions for all blockchains by implementing a low-latency loading solution.
Google’s BigQuery data analytics platform started off with Bitcoin and Ethereum last year. During the period developers have been monitoring usage of the software in order to create the next six datasets. The search giant also has a machine learning (ML) tool which searches for patterns in transaction flows so it can provide basic information on how a crypto address is used.
In what has been termed as a ‘unified schema’ the data has been structured in a easy to access method maintaining consistency across datasets. This will enable easier and smarter blockchain data comparisons for data scientists and researchers. The blog post highlights a number of example queries and applications for the data extracted.
The first terabyte for these datasets will be free each month according to the report with costs charged per byte following for heavy users. Rival tech and retail giants Microsoft and Amazon have also entered into the cloud and blockchain space last year as the competition heats up. Google has been the leader in big data for several years at it clearly aims to remain there for the nascent crypto industry.
“This is not some kind of dependency on government agency reporting,” Day added, “We have all the data, and we can pull metrics and and look at them and reason about them over time.”
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New Coinbase Venture Lets You Earn Free Crypto, BAT Surges 30%

Different crypto exchanges appear to be aligning themselves with different crypto projects. Binance is big on Tron and the new BitTorrent token it exclusively launched recently and Coinbase is now promoting Basic Attention Token through a new scheme called Earn which allows you to do exactly that.
Launched today, Coinbase Earn allows those invited via email to complete a number of online lessons and tutorials regarding the BAT powered Brave Browser in order to earn some of its tokens. In a tweet the company said that up to $10 of BAT would be initially available to those taking the online educational lessons and interactive tasks;

We’ve launched a new Coinbase Earn page where you can earn Basic Attention Tokens (BAT). Earn up to $10 worth of BAT today by completing educational lessons and interactive tasks. Visit: https://t.co/YheO7vhMCF
— Coinbase (@coinbase) February 6, 2019

It is clear that Coinbase is actively promoting the browser and BAT which it listed in early November last year. The Basic Attention Token aims to improve the efficiency of online advertising with the use of an Ethereum based token that can be issued between advertisers and publishers.
The new venture is aimed at raising awareness for the Brave open source web browser which intends to de-clutter the web by removing intrusive advertising. The space is currently monopolized by Google whose ads are literally everywhere. Facebook, another internet monopoly increasingly seen as a scourge, has also morphed into an intrusive stream of scammy looking ads that have replaced what people originally signed up to see.
The lessons have been launched on the Earn BAT page and are designed to raise awareness and increase adoption of the browser and its token.
“We see these interactive, advanced lessons in cryptocurrencies and tokens as an important step toward building awareness and usage of utility use-cases in the crypto ecosystem–one where a beginner can quickly get up to speed on a token in a few minutes, actually engage with the product, and earn some of that token along the way,” the Coinbase blog added.
It is one way to get people into crypto without them needing to buy it. Just like Binance, Coinbase views itself as a trusted source for crypto education and awareness. This unique venture provides a good alternative to airdrops which are also commonly used to raise awareness for a specific project, BitTorrent token being the most recent example.

As expected, BAT pumped 30% on the announcement surging from $0.10 to over $0.13 in an hour or so. It has since pulled back but still posts a 13% gain on the day as volume jumped from $4 to $17 million. BAT is currently in 32nd place in the market cap charts with $140 million, a Coinbase endorsement such as this will no doubt help to improve on that.
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Twitter CEO Loves Lightning on Bitcoin: is it the Future of Fast, Instant Payments?

On Tuesday, Jack Dorsey, one of the most well-known characters in Silicon Valley, just exposed his four million followers to Bitcoin (BTC) in a surprising turn of events. To the surprise of many, Dorsey, the incumbent chief executive of both Twitter and crypto-friendly Square, two technology upstarts valued at $54 billion collectively, publicly accepted a transaction via the Lightning Network.
As Anthony “Pomp” Pompliano of Morgan Creek would fittingly say, “the virus is spreading.”
Dorsey Experiments With Lightning, Sends Bitcoin Transaction
As hinted at in recent NewsBTC report, Hodlonaut, a Lighting Network crusader and self-proclaimed “HODLer,” recently took to his Twitter page to start an interesting community-run initiative. Through the medium of a tweet, Hodl divulged that he wanted Bitcoin users to start a chain on the Lightning Network, whereas participants would send marginally more BTC with each so-called “hop.”
While the enthusiast seemingly didn’t expect his little venture to garner much traction, it has. Over the past two weeks, Hodl’s grassroots idea, which has been dubbed the “Trust Chain,” has been picked up by some of Crypto Twitter’s biggest stars. Pompliano, Klaus Lovgreen, John Carvalho, Marty Bent, leading Bitcoin evangelist Andreas Antonopoulos and Elizabeth Stark of Lightning Labs, are among the mass of industry insiders that have picked up the so-called “torch.”
Related Reading: Bitcoin Lightning Network Adoption Advanced by New Bitfury Product Suite
After receiving the torch, Matt Odell, a prominent programmer that has centered his efforts around Bitcoin, surprisingly asked Jack Dorsey if he wanted to tout the torch next. And interestingly after a day of deliberation, Dorsey agreed, quickly pasting a Lightning Network invoice in response to Odell’s sudden inquiry. Just like that, lightning struck, and Dorsey was sent 2.86 million satoshis (0.0286 BTC) for near-negligible fees and within seconds.
Minutes after Odell issued a transaction, Dorsey, took to his personal Twitter page, the first-ever account issued (understandably so), to tout the merits of Lightning Network, calling Trust Chain a “cool example” of the benefits of the scaling solutions. He also confirmed that he received the 0.0286 BTC, subsequently claiming that he would be handing it back to Elizabeth Stark for the next hop.

Cool example of #BitcoinTwitter experimenting on the Lightning Network.
Torch received, now passing along to @starkness! #LNtrustchain https://t.co/YVMAv62fCN
— jack (@jack) February 5, 2019

In subsequent tweets, the Bay Area citizen doubled-down on his affection to the Bitcoin maximalist mindset. When asked why he only holds BTC, an amount which he deemed “enough,” the Twitter head commented that the project is resilient, principled, native to the ideals of the Internet, and a great brand in and of itself. Dorsey also made jabs at Bitcoin Cash, saying “hell no” when asked if he held a position in it, and Tron, joking that he liked the movie, not the cryptocurrency.
Rumor has it that the Twitter chief is looking into integrating Lightning Network, a paradigm-shifting scaling solution that facilitates low-cost, near-instant, secure, immutable, and private transactions, into Square’s crypto offering, which launched at the peak of 2017’s parabolic rally. In fact, in response to a tweet that outlined an idealistic system where people can tip satoshis for tweets (enabled via Lightning), Dorsey noted that he “loves the idea.”
Dorsey’s recent Lightning Network experiment comes after he made a guest appearance on the Joe Rogan Experience, a podcast/web spectacle that sports over four million followers on Youtube. As reported by this outlet last weekend, Dorsey remarked on-air that the “Internet will have a [single] native currency,” adding that from his perspective, it is most likely going to be Bitcoin.
He added that the Internet needs a currency, as it will bolster many operations worldwide, especially financial transactions and processes. Dorsey even went on to lambast the speculative nature of cryptocurrency markets, noting that Cash actually curbs day traders, while disallowing purely speculative transactions made via credit. His cardinal point was that he wishes to see cryptocurrencies reach global adoption not as a trade-centric asset, but as a tool for the overall betterment of humanity.
Crypto Community On Twitter Enamored 
As Jack’s sudden foray into the realm of the Lightning Network quickly trended on crypto’s portion of Twitter, commentators quickly took to their feeds to buzz about the occurrence, deemed auspicious, if not bull run-inducing by some.
Lightning strikes the Bitcoin community.
Arjun Balaji, a contributor to The Block and a crypto researcher, somewhat jokingly remarked that Jack’s sudden acceptance of a Lightning Network transaction may be the start of Square’s and Twitter’s forays into to the world of cryptocurrency. Balaji wrote:

The year is 2024. Via a Musk-like maneuver, Cash App and Twitter have morphed, creating a Bitcoin-native millennial bank on top of the most important communications platform on the planet to offer un-censorable speech and payments. Jack wins the Nobel Peace Prize. https://t.co/Ryq4AqBpAJ
— Arjun Balaji (@arjunblj) February 5, 2019

Hodlonaut, the one behind this innovative test of the Bitcoin community and Lightning Network expressed his excitement, noting that never in his wildest dreams did he expect for Trust Chain to garner notable amounts of traction.
Travis Kling, the chief investment officer of the Los Angeles-based Ikigai, noted that this bout of adoption is “the Lord’s work for the global, immutable, decentralized, non-sovereign, hardcapped supply, digital store of value [that is Bitcoin].” This comes after Kling made a series of overly optimistic comments regarding Bitcoin’s future, such as his opinion that cryptocurrencies could outperform all other assets in 2019, along with his underlying belief system that the rise of Bitcoin is inevitable.
Pompliano lauded the Lightning Network’s fundamental value, explaining that he wouldn’t be surprised if wallet-to-wallet transfers with the scaling protocol were faster than traditional credit card payments.
While the Lightning Network has a lot going for it. Where’s it going to strike next?
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“Grin is intended to be medium-of-exchange, and Beam is intended to be for store-of-value”, says Mastering Bitcoin author

During the recent Q&A session, Andreas Antonopoulos, the author of Mastering Bitcoin, elucidated on the difference between Grin and Beam, the two cryptocurrencies that are based on the same protocol – MimbleWimble. The protocol enables the coins to make transactions without disclosing information of the amount and addresses involved in the transaction.
According to the author, MimbleWimble makes space for the optimization of privacy and scaling at the same time. The protocol was introduced in 2016 by an anonymous contributor who goes by the French name of Lord Voldemort, Tom Elvis Jedusor. He said:
“Immediately, an effort was made to implement this. The first effort, which started two years ago, is an open-source community project called Grin. It is primarily research focused to bring MimbleWimble to life by creating an implementation.”
This was followed by Andreas stating that Grin is an open-source project and that it is crowdfunded. Additionally, the coin was not pre-mined and there was initial coin offering [ICO] and a financial model that would support the development of the project, apart from the volunteers of the cryptocurrency community.
Whereas, Beam was introduced a year later with a completely different mode. The author stated that there was a foundation behind Beam and the project also has a pay-out to the Treasury. Andreas further stated that this project attracted investments from Venture Capital firms and that there was an organization that funds for the development of the project.
“They have two different approaches [to governance]: one is a very grassroots, community development model that is mostly research search focus. The other one is more commercially oriented, intending to [create] a viable commercial product. Grin has a command-line interface [for Linux, OSX and Windows], which is not that easy to use. Beam has a full graphical user interface and mobile wallet, which is easier to use.”
He went on to say that both the projects have different monetary models; Grin issuing 60 new coins per minute in a linear, continuous issuance schedule. On the contrary, the Beam has a monetary policy that is similar to Bitcoin, a fixed supply.
“The way these are [each] advertised or described by those developing them is, Grin is intended to be medium-of-exchange, and Beam is intended to be for store-of-value […] Grin and Beam are both open-source. Initially, Beam was not open-source, but they are now both open-source and exchanging code, learning from each other.”
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Binance CEO: Crypto Cheaper, Faster & Easier Than Legacy Digital Payments

Crypto, Bitcoin (BTC) included, is slow, expensive, and hard to integrate, cry this industry’s skeptics. While this argument has gained traction in recent years, especially as blockchains struggled to keep up with the transactional demand seen in late-2017, some aren’t all too convinced.
In a recent tweet, Changpeng “CZ” Zhao of Binance explained why he believes it is economically, logistically, and socially logical for Internet-centric retailers and entrepreneurs to accept cryptocurrencies, whether it be BTC, Ether, or otherwise, as a bonafide payment method.
Related Reading: Why This Billionaire Investor is Betting on a Project Bringing Bitcoin Payments to Starbucks
Crypto As A Medium Of Digital Exchange Makes Sense
Zhao, a long-time participant in the crypto and fintech industries, recently noted how it doesn’t make sense to him that many Internet (non-brick and mortar) businesses don’t accept cryptocurrencies for payments.

For any internet (non-physical) based business, I don't understand why anyone would not accept crypto for payments. It is easier, faster and cheaper to integration than traditional payment gateways. Less paperwork. And reaches more diverse demographic and geography.
— CZ Binance (@cz_binance) February 2, 2019

In fact, Zhao, formerly of Blockchain.com and Bloomberg, noted that in his eyes, cryptocurrencies are not only more cost-effective, but easier to integrate and faster in terms of transaction finality, when compared to traditional payment gateways. Moreover, traditional digital payments, especially those routed through rent-seeking Silicon Valley darlings like PayPal, often require copious paperwork & KYC, while lacking the global accessibility that Bitcoin provides.
The Binance chief’s comment comes after Jason Smith, a crypto investor, claimed that BTC is already used as a form of digital money. In an extended rant on Twitter, Smith noted that merchants on Dream Market, a darknet-based market, actively want to accept BTC, quipping that they have no intentions to liquidate their digital assets for U.S. dollars. Smith even went on to cite anecdotal evidence he has gathered to note that thousands of users on Gum Tree, Australia’s Craigslist equivalent, accept cryptocurrencies, even while the broader market has collapsed.
And as such, the industry participant concluded that BTC “already is money,” and doesn’t need an exchange-traded fund or product of caliber to surmount that goal.
Bitcoin Adoption In Commerce Is Nearing
CZ’s comment regarding crypto adoption with online merchant comes after Pat Chirchirillo, a financial advisor at Philadelphia-based McAdam Financial, lauded this nascent asset class for being much cheaper than processes executed via the legacy financial system.
As covered by NewsBTC previously, Chirchirillo, who has seemingly expressed no love towards Bitcoin previously, noted that he was charged $10 by Bank of America for having made more than six transfers between his savings and chequing account within a month’s time. Although this wasn’t directly the fault of the Wall Street giant, as the fee was imposed by finance legislature, the financial advisor noted that the incumbent financial ecosystem was 3,233% more expensive than cryptocurrencies, which would have dinged him with ~$0.3 in fees for those same transactions.
While cryptocurrencies have yet to see monumental levels of adoption on Internet portals/stores, this facet of this budding industry has already garnered some semblance of backing. BitPay, the foremost crypto-centric payment service provider based out of Atlanta, recently released its 2018 debrief. In a press release, the company revealed that over the course of 2018, it processed over $1 billion in payments for the second time, while also setting a transaction fee record by securing clients like Dish Networks, HackerOne, and the State of Ohio.
Speaking on the matter with a positive tone, Stephen Pair, the chief executive at the long-standing blockchain upstart, stated:
“To process over a $1 Billion for a second year in a row despite Bitcoin’s large price drop shows that Bitcoin is being used to solve real pain points around the world.”
And with the launch of Bakkt — which isn’t only a Bitcoin futures provider, but a multi-faceted upstart too — being right around the corner, many believe that adoption in commerce will only continue in the years to come. The rise of the Lightning Network may also catalyze on-the-fence merchants to accept BTC, as the scaling solution, which recently passed a notable milestone, can facilitate instant, low-cost, and scalable Bitcoin transactions.
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Bitcoin proponent: Users’ lack of technical expertise has a higher chance of making them lose their crypto than a hack

Andreas Antonopoulos, a well-known Bitcoin proponent and the author of Mastering Bitcoin, spoke about one of the most controversial topics in the space at present, secure storage of Bitcoin [BTC] and other cryptocurrencies, during a Q&A session on Youtube.
Here, the author elucidated Trace Mayer’s statement that a user required Bitcoin Core for network validation, Armory for managing the private keys, the Glacier Protocol for standard operating procedures and a Purism laptop for hardware. He also spoke about the gold standard for the storing cryptocurrency, which would apply for non-technical investors as well.
On Trace Mayor’s pre-requisites, the author exclaimed that different groups have its own risk model and tolerance for technical complexity. He added that the important factor is that the technical complexity is a part of the risk model, adding that a user would be at “serious” risk of losing their cryptocurrency is the technical complexity is above their skill level. He went on to elucidate on the reason:
“Not because it is stolen, but because your ambition for technical excellence exceeds your current skill level, and you messed up [on the execution]. This applies to every level of technical expertise. There is always a ‘higher level’ of security to achieve, by adding a bit more complexity. Security is not an on / off thing, “it is secure” vs. “it is not secure”.”
He further affirmed that the is “no gold standard” that applies to everyone. However, a user can reduce the risks faced by identifying and understanding who could be after their crypto and under what circumstances they could access it. He added:
“[…] Whatever else the risk model might [include], then you must balance that against your technical skills. Find which of these risks you can eliminate, in a way that you and anyone designated to help your loved ones… recover your crypto if something happens to you, can execute flawlessly. That is the sweet spot.”
This was followed by the author stating that there Trace Mayer’s sweet spot turned out to be Bitcoin Core for network validation, Armory for managing keys, Glacier Protocol for operating procedures and a Pursim laptop for hardware. Andreas further stated that other people have higher standards in comparison, like that of Coinbase, which uses a Faraday cage for cold storage – a room lined with an electromagnetic shield to ensure that it does not leak radio frequencies. However, others don’t have anything that protects their storage room. He said:
“Trace is identifying his sweet-spot based on his level of technical expertise […] For 99% of users, this is not right, because 99% of crypto users do not have the technical expertise to execute on a plan of this complexity. As a result, what they will do is over-extend and underachieve on technical execution, standing a much bigger risk of losing their crypto due to key loss than having it stolen by an external adversary.”
He continued to say that a user’s lack of technical expertise, over-ambition in execution can result in them losing their cryptocurrency instead of losing them to “some nefarious hacker”.
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Source: AMB Crypto

Swiss cryptocurrency wallet manufacturer to create physical notes representing digital currency for the Marshall Islands

In a bid to bolster the local economy by enabling mainstream adoption of cryptocurrency, Switzerland-based blockchain smart card wallet maker, Tangem is all set to issue the world’s first banknotes that represent digital currency for the Republic of Marshall Islands [RMI]. Also touted as the sovereign currency- SOV, the currency will act as an alternative official legal tender along with US Dollar of Marshal Islands post its launch.
The SOV notes are physical in nature with blockchain enabled microprocessor embedded. An Israel based startup- Neema that facilitates global transactions, had developed the core technology for SOV using a protocol called Yokwe. This protocol is designed to pacify the financial violations and felony and 100% secure and transparent.
Creation of the all-new decentralized legal tender comes with the underlying aim to conventionalize its usage for all people in the tiny Pacific island. People of the RMI will have access to SOV regardless of whether they have an internet connection. With no internet requirement coupled with features like instant transaction validation and low-cost execution of global transactions even for people living in remote outer islands, Tangem banknotes will enable the Marshall Island’s foray towards a new global digital economy.
In a statement, President Hilda Heine announced,
This is a historic moment for our people, finally issuing and using our own currency, alongside the USD. It is another step of manifesting our national liberty.
The island nation passed the Declaration and Issuance of Sovereign Currency Act to issue the physical digital tokens on February last year. The project came to a brief halt on September after the International Monetary Fund [IMF] warned against the introduction of SOV.
This move is announced at a time when the termination date of reparation aid [the US compensation for carrying out 67 nuclear tests during the years 1946 to 1952] is drawing closer. The Marshall Islands might possibly face a grave economic crisis after 2023 which is why the small country has geared up by developing its own legal tender. Unlike Venezuela’s controversial Petro, which is oil-backed, SOV has been created with an intention to benefit the Marshallese citizens and put the island nation into the global map. Also, the Marshal Island plans to include blockchain expert Steve Tendon onboard, which reflects the sanctity of this ambitious project.
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Source: AMB Crypto

Ethereum [ETH]’s Joseph Lubin opens up about ConsenSys lay-offs

Joseph Lubin, the Founder of ConsenSys, a blockchain software development company, and the co-founder of Ethereum, spoke about one of the controversial topics surrounding the company, during an interview with CNNMoney Switzerland. The topic under discussion was ConsenSys lay-offs, which drew the attention of the entire space including the likes of Vitalik Buterin and Justin Sun.
The news regarding ConsenSys lay-offs first broke out towards the end of 2018, wherein the blockchain company announced that they have dismissed over 13% of its members, stating that they were streamlining several departments in the firm.
This was later followed by a report from the Verge claiming that the company would be laying off 50% to 60% of its employees, which summed up to around 1200, resulting in the majority of the members in the community discussing the future of the firm.
Lubin soon spoke about the matter in hand on his official Twitter handle, wherein he said that the company was healthy and that they were working on rebalancing their priorities and activities, which started about nine months ago.
“We are creating transitions for some projects that we believe don’t fit as well into the ConsenSys 2.0 vision as they did in ConsenSys 1.0, and we are working on ways to continue to support these projects going forward as we sketch plans for a ConsenSys alumni network.”
Joseph Lubin, during the recent interview, said:
“Well we’ve been around for around four years and our main mission during that period was to build out the infrastructure for Ethereum, to take that infrastructure and apply it to corporate situations consortium situations and to foster adoption to educate and we I believe that we were reasonably successful doing that”
This was followed by the Founder stating that the company recently “realized” that this is a competitive ecosystem and that there is a need to “tool” the company to compete in this ecosystem. He said:
“so there were some job functions that we didn’t need going forward and there are other job functions that we do need going forward so even the press may have focused on a kernel of of news. we’ve also hired a hundred people in in the last two months”
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Source: AMB Crypto

Ethereum [ETH]’s Vitalik Buterin and Justin Drake’s take on the community’s questions concerning Serenity

Vitalik Buterin, the creator of Ethereum, and Justin Drake, a researcher at Ethereum, spoke about Ethereum 2.0, during the latest Ask Me Anything session on Reddit. The AMA was hosted by the Ethereum Foundation and lasted for over 12 hours, wherein all the members of the Ethereum 2.0 research team answered the community’s questions pertaining to Ethereum 2.0.
Ethereum 2.0 is considered to be the Foundation’s biggest project as it includes some major updates to Ethereum. This upgrade is said to achieve scalability and make the network more efficient. The upgrade from Ethereum to Ethereum 2.0 is called the Serenity phase, aka the final phase of Ethereum 1.0. The key solutions brought by Serenity include Proof-of-Stake [PoS] – Beacon and Casper, Sharding, eWASM, Plasma, Raiden, and zero-knowledge proofs. Vitalik Buterin had previously claimed that Serenity is the world computer, which is a combination of different features that the team has been discussing for the past few years.
During the AMA session, the team was asked about what the best response would be to a developer, who is hesitant about building on Ethereum today, taking into consideration that Ethereum 2.0 will take over in the next few years. This question was asked by a Redditor, 0xStark.
To this, Buterin stated that after the state and execution model for Serenity solidifies, the team would be working with the developer community, wherein they would be focusing on modifications to high-level languages such as Solidity, and Vyper.
“Hopefully at that point it will become clearer how to build applications in such a way that they could be redeployed as-is on the 2.0 chain. At least that’s my hope.”
Justin Drake also replied to the question, wherein he stated:
“Building on Ethereum 1.0 today is great for learning and prototyping. It’s also great for assembling a culturally-aligned team consistent with the philosophy of the Ethereum community (which may be different than the philosophy of the Bitcoin, Ripple, Bitcoin Cash, EOS, Tether, etc. communities).”
Furthermore, another Redditor, Elizabeth Giovanni asked the researchers whether there were any economists being consulted to help decide the issuance rate of a full Proof-of-Stake system [PoS], and the effects certain decisions would have on the network and the community, both in the long-run and short-term. Here, Vitalik Buterin said:
“Personally at this point the feedback I’m most interested in is actually feedback from potential stakers. The main question basically being, are there any other tweaks we can make to the economics that, given a fixed level of reward, will (i) encourage more people to validate, and (ii) encourage many small solo validators or smaller pools, as opposed to a few large pools.”
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Source: AMB Crypto

Ethereum [ETH] co-founder led ConsenSys partners with Harvard, Levis & New America

ConsenSys, a blockchain software technology firm lead by Joseph Lubin, the co-founder of Ethereum, has marked a major milestone as the firm will be collaborating with key players in the US for blockchain-based solutions. ConsenSys will be collaborating with Harvard University’s public health graduate school, New America, a think-tank in the U.S, and Levi Strauss, an American Apparel Company. The announcement was made by New America on its official portal on January 24, 2019.
Through this collaboration, the annual worker survey will be stored on the blockchain. This step is considered as a “crucial first step” when it comes to transparent evaluation of employees’ working conditions in factories.
Interestingly, Harvard University’s public health graduate school, Harvard T.H Chain School of Public Health, will be effectively contributing to the blockchain-based survey as it will be using an index developed by the public health school, SHINE. This initiative will be funded via a grant from the U.S State Department.
Additionally, the blockchain-powered survey will be used first by Levi Strauss’ three factories in Mexico which employs around 5000 individuals in 2019. This will be first tested in Q2 of 2019, in all the three factories and the second test is scheduled to take place in 2020.
Joseph Lubin, the Founder of ConsenSys said:
“Ethereum is a technology that reduces the barrier for trust between two parties and will create a transparent environment for workers to securely and anonymously share critical information. Our goal is to develop, test, and scale a system that could empower employees, suppliers, and consumers to make informed decisions about factories, products, and brands.”
Director of Harvard T.H. Chan’s Sustainability and Health Initiative for NetPositive Enterprise, Dr. Eillen McNelly said:
“A distributed system of inquiry on the blockchain that goes right to the source [workers] offers a new solution. Most supply chain blockchain use cases are for material tracking, so leveraging this new technology for the evaluation of the human condition is an exciting innovation with broad potential for positive impact on worker well-being worldwide”
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Source: AMB Crypto

Bitcoin [BTC] nodes: 43% of all nodes based in the US, Germany; Asia lags behind, finds Bitnodes

Cryptocurrency statistics site Bitnodes recently released the global Bitcoin nodes distribution list. At the forefront of the list is the US, with a concentration of 2,433 reachable nodes, accounting for 24% of the total 10,164 BTC nodes in the world.
In the US, the state of California harbors most of the nodes, which is apparent because it serves as a global center of high-end tech and innovation. Above all, it is also the home to Silicon Valley.
Germany held the second position, with 1,930 BTC nodes, tallying a volume of 19.12%. The country has a greatly developed social market economy. A highly competent workforce coupled with a thriving startup work culture and low-cost workspaces has attributed to the economy of the nation. Berlin is often dubbed as the Silicon Valley of Europe. Germany is the largest national economy in Europe and levies no tax on Bitcoin [BTC] as it views the digital currency as a legitimate tender.
Germany is followed by France with 679 nodes and Netherlands with 485.
The list is dominated by the western countries, which maintained the top number of Bitcoin nodes, with only three Asian countries making it to the top-10 list. China stood at number five with 401 reachable nodes; Singapore held the eighth position with 309 nodes and Japan, with 241 nodes, held the tenth position.
China has the highest concentration of BTC nodes in Asia despite stringent laws and lack of infrastructure. A recent survey conducted by a crypto-dedicated news outlet revealed that a majority of Bitcoin holders were millennials between the ages of 19-28.
Singapore is known for its dynamic, innovative and business-friendly economy in the world. According to the Inland Revenue Authority [IRA] of the southeast Asian island, Bitcoin [BTC] is not considered as a legal tender, but are viewed as goods. Hence, the country levies a GST of 7% from any firm involved with the crypto dealings.
Japan is often touted as the hub for cryptocurrencies, as the first Bitcoin software was created by a programmer [or a group of programmers] under the pseudonym of Satoshi Nakamoto. It is the first country in the world to have officially recognized the leading digital asset as legal tender. After suffering two tremendous exchange hacks – Mt Gox and Coincheck – the country has accommodated regulations directed to improve security at its crypto exchanges.
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Source: AMB Crypto

Bitcoin Lightning Network Adoption Advanced by New Bitfury Product Suite

The lightning network is still under development but that hasn’t stopped the Bitfury Group from launching a new product suite designed to make the system easier for merchants and consumers to use.
Wallets, eCommerce Software, Terminals and Nodes
Lightning network has been hailed as the savior of Bitcoin, bringing its transaction speeds to equal or exceed some of the alternative cryptocurrencies that have emerged over the past couple of years. Rapid and low cost transactions would no doubt to wonders for Bitcoin adoption in everyday life but so far progress has been slow.
Blockchain technology provider Bitfury, founded in 2011, aims to change that with its new LN based products which include an open source LN Bitcoin wallet, a hardware terminal and e-commerce software for vendors, payment processors, and a suite of developer tools. A public Lightning Network node has also been created to help users open payment channels.
According to the announcement the products, which are supported by Bitfury’s Lightning Network engineering and research team, Lightning Peach, have been designed to bring all steps of the business cycle onto the network. Ease of onboarding is key to overall adoption and Bitfury have acknowledged this with the new suite for both merchants and consumers. Bitfury CEO, Valery Vavilov, added;
“The Lightning Network will enable people to use bitcoin in their everyday lives. By providing these products to the market, Bitfury is encouraging worldwide adoption of this technology and providing unparalleled support to consumers and merchants.”
There are a raft of features on the new Peach wallet which all make using LN for daily transactions far easier. The commerce suite has been targeted at individual merchants and payment processing companies, again making their lives easier when dealing with LN. The terminal provides point of sale and vending machine support for instant, low cost Bitcoin payments.
Bitfury is not the only company eager to get more people using lightning network. In a related report, Forbes has suggested that LN could replace all potentially unsecure altcoins offering faster transactions. Online retailer, Bitrefill, has claimed that almost twice the amount of payments made are processed on LN than all other altcoins combined.
The company offers a range of digital goodies such as gift cards and prepaid phone minutes via cryptocurrency payments. Just like Bitfury, it too has been working on a range of products to increase usage and adoption of the lightning network. Referring to Thor, a channel creation service on Bitrefill’s node, the company blog added; “If someone’s looking to receive bitcoin, as tips or other earnings, this is a quick and easy tool to get started. Bitrefill’s node is a highly interconnected in the Lightning network,”
Adoption is paramount to the growth and success of cryptocurrencies, and for Bitcoin at least, the lightning network plays a huge role in increasing its daily usage as a means of quick and easy payment as it was originally designed.
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