No Cash, No Pain: What if You Woke Up to No Paper Money?

In an paperless money environment, people would find several ways to thrive What if we wake up one day and find that all the paper money that we are familiar with has disappeared? We might shake our empty wallets but it would do us no good. Yet all is not lost, we still have access […]
Source: Forklog




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Bitcoin Cash Forked Splitting Into Two Blockchains

A hard fork has taken place on the Bitcoin Cash network, resulting in the creation of two separate coins: Bitcoin ABC (BCHABC) and Bitcoin SV (BCHSV). The hard fork was activated 18:02 UTC on Thursday, November 15, on block 556,766 that was mined by SVPool and became the last block for Bitcoin Cash. The first […]
Source: Forklog




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Hash Wars: ABC Chain Leaps More Than 50 Blocks Ahead

Hash Wars: ABC Chain Leaps More Than 50 Blocks Ahead

All eyes were on the Bitcoin Cash network today as the blockchain split into two after the last common block was found on the chain at height 556766. So far both chains have been chugging along, but at the time of writing, the ABC side is well over 50 blocks ahead of the SV chain.

Also read: Hash Wars: The Bitcoin Cash Hard Fork Has Begun

A Historic Day for Bitcoin Cash

Over the last 12 hours, cryptocurrency enthusiasts from all around the world watched the highly anticipated Bitcoin Cash (BCH) network fork on Thursday, Nov. 15, with great excitement. Like many fans expected, the BCH chain split into two and miners from both camps are mining each chain at the moment. The split was cemented when SV miners processed block 556767 at 1:22 p.m. EST on an entirely different chain than the one mined by Bitcoin.com at 1:00 p.m. EST.

Hash Wars: ABC Chain Leaps More Than 30 Blocks Ahead

There’s been a lot of discussion between both sides of the fork debate, and live streams were broadcast from both camps throughout the day. As we mentioned in our previous report, Jihan Wu was quiet earlier this week but today he congratulated Bitcoin.com for mining the first block with the ABC ruleset changes. The Bitmain CEO also tweeted to his followers the following statement:

There will be no more negative gamma after this block in BCH community. Congratulations.

Craig Wright, who is usually a bit more vocal on Twitter, did not tweet his usual amount of statements during the fork. However, at block height 556781, when the SV chain briefly took the lead, Wright wrote, “In all this, no user transactions are lost — And SV is ahead.” Wright appeared on podcast channel Hashwar.live on Keyport.tv with the BCH Boys, Daniel Krawisz, and Ari from Cashpay Solutions. Another web destination where many people discussed the fork was the Coinspice live stream channel. This particular stream saw members of the community such as Bitcoin.com’s Roger Ver, Ethereum’s Vitalik Buterin who briefly visited, Andreas Brekken of Shitcoin.com, and many more special guests.

For Now, the ABC Side Has Gathered More Blocks, Work, and Hashrate

During the course of the day, there were multiple large blocks mined on both chains. On the ABC chain, Bitcoin.com and BTC.com in particular processed some blocks between 4-8MB in size. On the SV chain, Coingeek and other pools mined a few large blocks as well during the first few hours. Initially, BTC.com and Bitcoin.com pools found most of the ABC blocks, but later on Bitmain’s Antpool started mining on the ABC chain. Chinese ming pool Viabtc then followed Antpool and started chipping away at the ABC side. Similarly, Coingeek and SV Pool mined the first SV chain blocks. BMG Pool did not jump in until much later, mining only a couple of blocks in total.

Hash Wars: ABC Chain Leaps More Than 50 Blocks Ahead
Orange represents the ABC hashrate (8.9 EH/s). The SV hashrate is in red (3.5 EH/s). Nov. 16, 2018, 12:46 a.m. EST.

At the time of publication, the ABC side of the chain has more than a 50-block lead over the SV side and a lot more hashrate, according to Coin Dance statistics. Moreover, the SV side of the chain became a bit sluggish around block height 556812 through 556814.

Hash Wars: ABC Chain Leaps More Than 30 Blocks Ahead
The mining pools on the ABC side are Antpool, Bitcoin.com, BTC.com, and Viabtc. The SV side miners are BMG Pool, SV Pool, Mempool, and Coingeek. Nov. 16 12:46 a.m. EST. 

According to Coin Dance cash statistics, the summary of hourly BCH hashrates by each network shows the SV chain’s processing power started to taper off around 10:00 p.m. EST. At 12:45 a.m. EST on Nov. 16, the ABC chain shows a hashrate of around 8.9 exahash while the hashrate for the Bitcoin SV chain is only 3.5 exahash at press time. The Forkmonitor.info tool created by Bitmex also shows the ABC chain is well ahead of the SV chain by accumulated proof-of-work.

Of course, there will be more discussion going forward concerning this fork over the next few days and even longer. BCH community members will have to wait and see how infrastructure providers plan to deal with the split. Alongside this, observers will be closely monitoring both chains for future developments and keeping a close eye on the crypto-market action.

What do you think of the action that took place on the Bitcoin Cash chain on Nov. 15? Let us know what you think about this subject in the comments section below.


Images via Shutterstock, Pixabay, Coin Dance, and Twitter. 


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The post Hash Wars: ABC Chain Leaps More Than 50 Blocks Ahead appeared first on Bitcoin News.

Source: Bitcoin News




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Stablecoins Demand More Trust than Fiat Currency

Stablecoins Demand More Trust than Fiat Currency

This article about the problem with stablecoins was written by Kevin Murcko, the CEO at cryptocurrency exchange, CoinMetro, and forex broker, FXPIG.

Stablecoins — digital coins which peg their value rigidly to the dollar, the euro, or a collage of national currencies — are all the rage right now. Tether, in particular, is on everyone’s lips. In fact, it’s one of the most heavily traded cryptos in the market right now.

Also read: Stablecoins Fetch a Premium as BTC Hits Year Low

Stablecoins Demand More Trust than Fiat Currency

The appeal of Tether and other stablecoins is somewhat understandable. All cryptos are nascent assets; speculation, rather than the usefulness of the technology or the underlying asset, is what’s mostly been driving price movement. That’s led to wild volatility.

Traders love volatility, but not unreasonably, some people see a problem. Volatility is broadly incompatible with the concept of a day-to-day currency and a store of value. “Stablecoins” have arrived to fix this by, ostensibly, digitizing a fixed value in terms of dollars or an equivalent.

The Use Cases for Stablecoins

Certainly, there are a handful of legitimate use cases for stablecoins.

Let’s say a liquidity provider owes me $0.5 million. Maybe I need that money immediately to be able to rebalance my book — the traditional banking system isn’t the best way to do that. Even if we’re with the same bank, it can take a while to clear that transaction.

Stablecoins are useful because I can instantly clear funds back and forth. They offer the convenience and speed of using crypto without the caveat of volatility.

As the International Monetary Fund’s Christine Lagarde pointed out in a speech this month, Central Bank Digital Currencies (CBDCs) are another intriguing opportunity. While the benefits aren’t fully understood, CBDCs have the potential to limit costs and risks to payment systems, mitigate fraud and money laundering, and potentially even boost financial inclusion throughout the developing world.

Substituting Fiat Currency

Stablecoins Demand More Trust than Fiat Currency

Beyond these examples, however, stablecoins really struggle to prove their worth. Front-end, business-issued stablecoins (practically all stablecoins being traded at the moment) fall flat.

Currently, these stablecoins are used as substitutes for fiat on crypto exchanges that don’t have access to central bank-issued money. It’s not that these tokens are preferential to fiat. Rather, they’re band-aid solutions for retail exchanges which, for various reasons, can’t open and maintain adequate fiat on-and-off-ramps — usually because they aren’t properly licensed to offer fiat, or because they don’t have access to the necessary banking.

Why, in most circumstances, aren’t stablecoins preferential to fiat? It ultimately comes down to trust.

As we all know, crypto was originally intended to be trustless. The Bitcoin whitepaper laid out a vision to escape “to transact directly with each other without the need for a trusted third party.”

What stablecoins represent, in many ways, is the antithesis of that idea. The crypto community now uses privately issued tokens or coins that are pegged to the very currencies they originally wanted to pull away from. That’s problematic for a number of reasons.

Stablecoins require you to have confidence, not only in the government, but in an undependable, easily corruptible private company. We have to place our faith outside of the chain and in these companies’ ability to self-regulate supply and demand.

The Collateralization Problem

That’s a tall order. Stablecoins can be split into three states of collateralization, or the extent to which the coin is backed one-to-one by fiat. Some coins are fully collateralized, others are partly collateralized, and others are entirely uncollateralized. Unfortunately, all provide insufficient mechanics to properly regulate price.

For noncollateralized tokens, value is essentially suppressed by “printing” digital money. That’s all well and good, but when the price drops, it’s not possible to un-issue what’s already in circulation.

Here’s the snag. If the smart contract can’t keep the price at $1, then the algorithm is forced to issue bonds, promising users an entitlement to coins in the future. The bonds are then redeemed, and the price returns to $1.

That’s the theory, at least. The issue is, these bonds can only really be serviced if the platform is in an overall state of growth. The headache arises when the price keeps on dropping, and increasing numbers of bonds have to be issued until this price returns to trading level or above par. Bonds can’t be issued indefinitely.

The Fundamental Flaw: Artificial Inflation

Stablecoins Demand More Trust than Fiat Currency

Partial collateralization presents a minor improvement over the complete lack of reserve assets, but it still has a fundamental flaw: If confidence in the platform dips, then the company has to artificially inflate the price of its token by drawing on a finite pool of fiat reserves, preventing the price from plummeting. This, of course, has a limit. A company can only buy back so much of its own currency.

Presumably then, “fully collateralized” models like Tether are therefore reliable? Not really.

Even if we take the company for its word (there’s some uncertainty as to whether their assets are fully collateralized), it still doesn’t make much sense to abandon the relatively safe greenback for an inconvenient crypto that doesn’t always have fiat parity, provides no consumer protections, and is vulnerable to hacking.

Stablecoins: An Awful Idea

Central banks may not be the ideal institutions to trust, but many have stood resolutely for decades with the primary goal of maintaining our trust in their money. If privately backed stablecoins are designed to replace our reliance on these central banks with a reliance on a combination of both central banks and their loosely regulated businesses, then this seems like an awful deal to say the least.

Let’s not confuse lack of volatility with stability. That’s a dangerous mistake to make. Yes, many stablecoins do have relatively “stable” prices, but “stability” — in another sense of the word — is also about reliability, and that’s one thing that can’t be said of stablecoins, which demand far more trust than the original fiat.

Do you agree that stablecoins are overhyped? Can stablecoins solve the problem of volatility? What is the future of the stablecoin? 


Images courtesy of Shutterstock


OP-ed disclaimer: This is an Op-ed article. The opinions expressed in this article are the author’s own. Bitcoin.com does not endorse nor support views, opinions or conclusions drawn in this post. Bitcoin.com is not responsible for or liable for any content, accuracy or quality within the Op-ed article. Readers should do their own due diligence before taking any actions related to the content. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any information in this Op-ed article.

The post Stablecoins Demand More Trust than Fiat Currency appeared first on Bitcoin News.

Source: Bitcoin News




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Nvidia Q3 Results Reveal ‘Crypto Hangover’ Due to Disappearance of Miner Sales

Nvidia released its Q3 2018 results today, revealing a “crypto hangover” as GPU prices failed to adjust quickly enough to disappearing demand from crypto miners.

Nvidia released its earnings report for the third quarter (Q3) of 2018 today, Nov. 15, revealing that demand for Nvidia’s graphics processing units (GPUs) among crypto miners has dried up.

In the financial results report, founder and CEO of Nvidia Jensen Huang said that the company’s “near-term results reflect excess channel inventory post the cryptocurrency boom, which will be corrected.”

Put differently, the cryptocurrency frenzy drove up prices for Nvidia’s gaming cards, but once that demand disappeared, prices did not decrease quickly enough to attract customers who were waiting for more affordable cards. Huang told Reuters:

“The crypto hangover lasted longer than we expected. We thought we had done a better job managing the cryptocurrency dynamics.”

The company’s provision for inventories purportedly expanded to $70 million in Q3, having more than tripled for the first nine months of the current year to $124 million. This also resulted in the decrease of Nvidia’s gross margins by 1.8 percentage points in Q3 to 60.4 percent. The margins drop is also attributed to $57 million in charges related to the company’s previous generations of chips following the plunge in cryptocurrency mining demand.

After Nvidia’s post of sales missed expectations for Q3, the company’s shares dropped over 16 percent in late trading:

Nvidia stock following Q3 announcement. Source: Quartz

Nvidia stock following Q3 announcement. Source: Quartz

Per the financial report, Nvidia’s overall revenue in Q3 was $3.18 billion, a 21 percent increase compared to $2.64 billion a year earlier, and up two percent from $3.12 billion in the previous quarter.

In August, Nvidia forecasted its Q3 revenue to be between $3.19 billion and $3.32 billion, stressing that it does not expect to make significant blockchain-related sales for the rest of the year.

At the same time, Nvidia’s revenue for the third quarter is higher than that recently projected by experts from analytical firm Trefis. The experts expected consolidated revenues to be a bit under $3.10 billion in Q3, of which 84 percent could be attributed to GPUs.

Source: Coin Telegraph




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