Tag Archives: Cryptocurrency

Elon Musk Wrong About Bitcoin Energy Consumption?

ELON MUSK Wrong About Bitcoin Energy Consumption? – powered by ise.media

Elon Musk and Janet Yellen are suddenly ‘concerned’ about Bitcoin’s environmental impact. But is Bitcoin really that harmful? Our interview with Bob Burnet explains just how wrong their statements are and how Bitcoin is actually paving the way for energy efficiency.


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GPU Revenue Signals Growth of Cryptocurrency Demand

(DFN) Record sales by GPU manufactures, Nvidia and AMD, signals that consumer demand for cryptocurrency mining and thus cryptocurrency is continuing to increase.

Last week Nvidia posted first quarter revenue of $3.21 billion USD, of which $289 million USD, or 9% of total revenue, was attributed to cryptocurrency mining sales. AMD, Nvidia’s chief rival, also reported first quarter revenue of $1.65 billion USD, of which 10% were also cryptocurrency mining sales. Even more significant was the growth from the previous year, 145% from Q1 2017 for Nvidia and 40% from Q1 2017 for AMD. Nvidia’s CFO Colette Kress said that “cryptocurrency demand was again stronger than expected, but we were able to fulfill most of it with crypto-specific GPUs”.

However, both companies are moderating their forecasts for future growth. Nvidia expects the second quarter revenue to be a third of this past first quarter. AMD’s spokesperson said that they expect revenue from cryptocurrencies to be in the “mid-to-high single-digit percentage” for 2018 in total. The moderation comes from ever increasing hashrates and the increasing competition from ASIC companies such as Bitmain, which brought in nearly $4 billion USD last year.

Increasing hashrates due to increasing cryptocurrency demand

As cryptocurrency became more popular so did the demand and mining operations. As the demand growth outpaced the pre-coded supply growth of many cryptocurrencies, the price of cryptocurrencies increased due to supply and demand laws. The higher price due to the larger demand then caused higher prices for mining GPUs and eventually the development of ASIC miners and their inevitable price increases.



A common misconception is that the high prices of cryptocurrencies are derived from the hardware and electrical cost of mining said cryptocurrencies. However, this is false, and it is the opposite which is true; the significant price paid for hardware and electricity are derived from the prices of cryptocurrencies, which is derived from supply and demand laws. It is only the knowledge that mined cryptocurrencies can be sold on the market for a high price because of their high demand, that allows miners to justify the capital expenditures.

Throughout this whole process the increasing demand is increasing the hashrate of each cryptocurrency’s network. The larger hashrate increases the security of each blockchain since it becomes considerably harder to initiate a 51% attack. A virtuous circle forms since a higher hashrate grants more security and thus creates more demand among consumers looking for ways to secure their wealth.

Dash has exceptional hashrate power and thus security

Recently, the price of Dash has fallen along with most other cryptocurrencies, however, the overall hashrate of Dash has stayed within the 1.5-2.5 petahash range, even though Dash only broke through the 1 petahash threshold in November 2017. The hashrate is bolstered by the second layer masternodes, which play an important role in the Dash ecosystem. The Dash network is further supported by the fact that it is more profitable to mine Dash via ASICs and more-or-less not profitable via GPUs. Thus, ASIC miners comprise a significant portion of the Dash network hashing power. Since each ASIC miner is built to mine specific coins, this makes the switching cost larger and less likely that the Dash network will see sudden significant hashrate declines due to price drops.

The comparative strength of the Dash network that sets it apart from other coins is derived from its unique structure and incentives. The demand for Dash is increasing all over the world due to the hard work of Dash teams, many of which are funded by the Dash treasury system. The Dash masternode system ensures those with capital means have a vested interest in the growth and security of the network. In addition, Dash is able to clearly communicate its future growth plans and outlook clearly to all observers. The strong demand growth combined with well designed incentives and clear expectations communication is influencing miners to continue mining, despite price volatility, thus maintaining the hashrate and network security.


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This article was republished with permission from Dash Force News.

Portsmouth: New Hampshire’s Digital Currency Hotspot

New Hampshire has become home to an impressive number of cryptocurrency-accepting businesses, with several businesses embracing the decentralized benefits of cryptocurrency by offering common payment options such as Dash, Bitcoin, and Bitcoin Cash.

You can find the hub of this movement in the town of Portsmouth, New Hampshire, which is described as “Bitcoin Village.” A significant feature of this village is the Free State Bitcoin Shoppe, a store attracting customers from high-traffic tourist areas nearby with their unique crypto-related and liberty-centric goods. However, tourists quickly learn that they can’t purchase anything in the store with cash, which provides an opportunity for the proprietors of the Free State Bitcoin Shoppe to step in and educate newcomers.

The shop founders, Derrick J. Freeman and Steven Zeiler, have a mission to “change the money that people use.” In a Q&A with the Free State Project, Freeman said that “if customers come in, set up a free wallet on their phone, and leave, I’m happy that they took a step toward greater financial freedom. Success is people using cryptocurrency at stores other than our shop.”

Zeiler has also developed a system for local businesses to accept various cryptocurrencies as payment. AnyPay.global is a new POS system spreading quickly and flourishing in the Portsmouth area.

“Like most people who use cryptocurrency, Steven and I have long dreamt of a physical retail shop that accepts cryptocurrency exclusively,” Freeman noted in the Q&A. “So, in a sense, this idea has been brewing for almost a decade. After years of waiting, we decided that if no one was going to do it, then it would have to be us. After deciding to open a crypto-only shop, the implementation was almost immediate.”

Freeman also discussed in the Q&A how the shop helps introduce new users and facilitate sustained use of crypto:

“In under five minutes, we help them (customers) download a digital wallet on their phone, turn their cash into crypto, and take payment. Everyone leaves feeling good. Most people have long been waiting to try bitcoin, but they’ve never had someone hold their hand while they do it. Those who don’t want to either don’t have the time or the interest. That’s to be expected. Not everyone wants bitcoin. Some people are perfectly happy with a money that funds wars and loses purchasing power every year.”


Freeman and Zeiler have had nearby businesses inquiring how to accept cryptocurrency. The Free State Bitcoin Shoppe provides a directory that lists a number of merchants accepting cryptocurrencies in the city, even specifying which forms of cryptocurrencies are accepted.

New Hampshire’s vibrant cryptocurrency community can be thanked in large part to the Free State Project, a liberty-minded movement of individuals looking to explore and work toward a free society. The movement has led to one of the most cryptocurrency-friendly places in the world, with a high acceptance and use of cryptocurrency among the Free State community of 4,352.

The New Hampshire cryptocurrency community played a critical role in the passing of a state law that exempts digital currency from the state’s money transmission licensing. Even though state regulators showed opposition, the bill passed due to strong grassroots support. The crypto supportive policy has attracted startup companies such as LBRY as well as Anypay.

A popular cryptocurrency to highlight within Portsmouth is Dash, which bears support from local businesses. According to DiscoverDash, there are 22 locations in the town accepting Dash. The entire state of New Hampshire has roughly 1.3 million inhabitants and features 54 Dash-accepting businesses, supporting a strong and active Dash-friendly micro-economy.

Joël Valenzuela, editor of Dash Force News, was recently featured on CNN illustrating living a cash-free life. Valenzuela is paid in Dash and is able to make nearly all his purchases with Dash, including primary living expenses like bills and rent.

However, CNN appeared unaware that Portsmouth is only the beginning of cryptocurrency adoption and more experiences like Valenzuela’s are likely to come about. Unlike local currencies like “Berkshares” and “Equal Dollars” which only hold value within their communities, cryptocurrencies like Dash hold value across the globe.

Editor’s note: Dash Digital Cash is the exclusive sponsor of Reality Check and the Truth in Media project.

Early Investor in Tesla, Hotmail, and Skype Says Bitcoin Will Be Bigger Than Internet

Billionaire venture capitalist Tim Draper claims that Bitcoin could be bigger than the internet.

CNBC reported that Draper recently spoke at the Intelligence Squared U.S. debate presented in partnership with Manhattan Institute’s Adam Smith Society. Regarding the potential of cryptocurrency, he said:

“This is bigger than the internet. It’s bigger than the Iron Age, the Renaissance. It’s bigger than the Industrial Revolution….This affects the entire world and it’s going to be affected in a faster and more prevalent way than you ever imagined.”

Draper is known for his investments in Tesla, Hotmail, and Skype. However, when comparing those investments he said Bitcoin will be “bigger than all of those combined.”

Draper further claimed that Bitcoin’s value will hit $250,000 by 2022, and stated that “in five years you are going to try to go buy a coffee with fiat currency and they are going to laugh at you because you’re not using crypto….I believe that there will be a point at which you will no longer really want any of the fiat currency.”

Draper isn’t the first major investor to make bold Bitcoin predictions. John McAfee, founder of McAfee antivirus software and cryptocurrency advocate predicted in 2017 that Bitcoin would reach $1 million by the end of 2020.


Former Goldman Sachs partner and former Fortress Investment Group hedge fund manager Michael Novogratz predicted late last year that Bitcoin would reach $50,000 by the end of 2018. Twitter and Square CEO Jack Dorsey predicted that Bitcoin will become the world’s single currency over the next 10 years.

Financial Times Managing Editor Gillian Tett argued against claims of Bitcoin’s future domination during the debate, pointing out market volatility and criminal uses as issues preventing it from massive implementation in the future, although some have claimed that volatility will subside upon larger Bitcoin adoption.

Draper insisted he feels “more secure in my Bitcoin than I am in the money that’s sitting there in Wells Fargo.”

Draper told CNBC in December that he bought 30,000 Bitcoins in a 2014 auction and he is still holding those coins today. Those Bitcoins are worth close to $270 million based on current market prices.

Arguing alongside Draper during the debate was Overstock CEO Patrick Byrne. He shared comparable confidence in Bitcoin and cryptocurrency security in general, saying:

“This has been hacked at more than anything in history and has never been defeated…Last I checked, banks get hacked too. And yeah, Bitcoin is used by unsavory characters. Last I checked, they used U.S. dollars too.”

Bitcoin is currently holding 38% of the cryptocurrency market. Bitcoin’s value reached $20,000 in late 2017 and is currently just under $9,000 although this up from $4,400 in August 2017.

Yahoo Japan To Purchase 40% Stake in Cryptocurrency Exchange

Yahoo Japan recently confirmed they are buying a 40 percent stake in BitArg(ARG) Exchange Tokyo, as ARG announced it would accept minority stake capital participation from Z Corporation, an owned subsidiary of Yahoo Japan Corporation.

The exchange operator explained (translated):

“As a result of this capital participation, the Company will be able to utilize the service operation and security expertise of the Yahoo Japan Group, which will make it easier for customers to prepare for the start of the exchange service managed by the Company and to improve the operation after the commencement we will promote the provision of secure exchange services.”

This comes after another recent move by a major Japanese company, Monex Group Inc., announcing last week it would buy 100% of Coincheck Inc for $34 million. Yahoo Japan maintains a major tech presence in the country, ranking at #4 by user traffic and #40 globally. The launch of the newly developed exchange is planned for April 2019, with plans to make further investments through subsidiaries over the year prior to launch.

According to Yahoo Finance, “unofficial figures of the capital” are between $18.5 million and $27.8 million.

This recent move by Yahoo Japan does not come as a surprise, as in late March Nikkei reported on the company’s intentions to open a cryptocurrency exchange and plans to acquire a stake in BitARG Exchange.

These major corporate investments into cryptocurrencies also come after recent news of Japanese crypto exchanges closing because of the government’s regulations. Last April, the Japanese Financial Services Agency(JFSA) passed regulatory action requiring crypto exchanges to register with the agency, which is the same ruling that allowed for Bitcoin as payment.

Japanese citizens remain one of the leading locations for cryptocurrency involvement by the population. Coindesk reported that Japan’s Financial Services Agency(FSA) found that Japan has 3.5 million individuals that are trading with cryptocurrencies.

Reality Check: What Venezuela’s National Crypto Means for Decentralization

President Trump recently announced a ban on Venezuela’s new national cryptocurrency, the petro.

That’s right—Venezuela created its own national crypto, possibly to circumvent U.S. sanctions.

But could the petro do more than that, and actually catalyze government-controlled cryptos around the world?

This is a Reality Check you won’t get anywhere else.

President Trump signed an executive order March 21 banning all transactions involving digital currency issued by the Venezuelan government, after it began pre-selling its own cryptocurrency, the petro, in February.

The petro differs from other cryptos because, according to the Brookings Institute, “The price of one petro is pegged to the price of one barrel of Venezuelan oil…” and “the petro/bolivar exchange rate … includes a discount factor determined by the Venezuelan government.”

By making that distinction, the Venezuelan government is now responsible for managing multiple currency systems simultaneously, creating what Dash Force News Editor Joël Valenzuela described as “an accounting nightmare.”

But isn’t cryptocurrency supposed to make accounting for transactions easier?

Well, actually it’s not the cryptos but the tech they’re built on. A few episodes back, we discussed how cryptocurrency is backed by radical transparency due to the power of the blockchain.


Rather than being backed by radical transparency and being a “trustless system”, as Valenzuela called it, the petro is essentially “fiat crypto.”

“When you back it with something that doesn’t have transparency, you have to trust the party that is providing the assets that back the coin,” according to Valenzuela. “It ruins its original value proposition.”

So why would Venezuela create the petro in the first place?

Once a crypto is a national currency, it’s subject to many tariff barriers and, in some cases, sanctions. Which is why President Trump made the first major national decision by the U.S. to ban a cryptocurrency. But cryptos like Dash aren’t tied to a government and weren’t created to bypass sanctions.

Once the richest nation in Latin America, Venezuela had suffered wild inflation, plummeting the standard of living and causing uproar from poverty stricken citizens. Many Venezuelans facing economic hardship are putting pressure on the government to stop the bleeding.

Anything to ease their suffering in the short term will be a boon to the tyrants, according to Valenzuela. But because the petro is not truly backed by trustlessness, critics say the government crypto won’t last long. And that presents a challenge to other governments considering creating their own cryptos.

Russian President Vladimir Putin already announced his government will issue its own CryptoRuble, likely sometime in mid-2019, according to CoinTelegraph.

The CryptoRuble is supposed to be directly tied to the ruble, issued by the Russian government and could not be mined.

More governments are likely to investigate the benefits of state controlled blockchain technology.

But remember, the two major selling points of blockchain are radical transparency and decentralization, meaning no one can manipulate the supply or the transactions.

And it’s those two aspects of blockchain that governments aren’t fans of.

Recently Congressman Brad Sherman of California read a statement that called cryptocurrencies “harmful,” and appeared to accidentally admit that cryptocurrency reduces government control of our currency. He said, “It hurts the U.S. government in two ways. Our contr… …our ability to have the US dollar be the chief means of international finance is what has underpinned our ability to impose sanctions…”

So Sherman doesn’t like the lack of “contr…” that the government has over crypto.
But on the other hand, imagine if the U.S. decided to use blockchain to track how our tax dollars are spent. Remember when the Pentagon admitted earlier this year that it couldn’t account for hundreds of millions of dollars?

What could help prevent data loss like this? The blockchain.

Corporations are already testing out the tech to prevent major data breaches like what happened to Target, Home Depot, JP Morgan, Anthem and others.

John Oliver explained the power of the blockchain in a recent episode of his show “Last Week Tonight.” He said, “The blockchain… a database that is nearly impossible to hack or tamper with, and which could possibly improve security, efficiency and trust. That is why big companies like Wal-Mart, IBM and JP Morgan have all been experimenting with blockchain as a way to potentially share and secure data transactions in a reliable, easy to access way.”

So what you need to know is that the blockchain presents an opportunity for governments to create a more transparent financial system. But Venezuela isn’t really doing that with the petro.

The crypto market has and will continue to fluctuate. Some crypto will disappear, some will stick around.

The question is, who is going to control the crypto? If governments do… they will take away the freedom of crypto… but if crypto currencies remain decentralized, then we will be able to keep a radically transparent financial system for the people.

That’s Reality Check. Let’s talk about that, right now, on Twitter and Facebook.

John McAfee Selling Cryptocurrency Promo Tweets for $105K

John McAfee has become a celebrity face in the cryptocurrency world. In a recent tweet, McAfee has publicly taken this role further by announcing the formation of the McAfee Crypto Team.

McAfee is a well-known businessman and computer programmer who formed McAfee Associates 25 years ago. The company had great success with antivirus software, which led to Intel acquiring the company in 2010 for $7.68 billion.

[RELATED: Presidential Candidate John McAfee Talks to Truth In Media About the Drug War, Immigration, ISIS, Bernie Sanders and More]

McAfee’s Twitter feed is loaded with cryptocurrency discussion and promotional material. Multiple posts on many days feature tweets about crypto exchanges, altcoins, and Bitcoin. He is also known for mentioning Initial Coin Offerings (ICOs) and coins that he is supporting, which has led to allegations of his involvement in ‘pump and dump’ campaigns.

SAFEX spiked 92% hours after McAfee tweeted about them in December of 2017. Another promoted coin was BURST in late December, which saw a 350% gain.

Prior to announcing his new promotional marketing plan, McAfee has been silent about whether he is paid for his tweets, as a single positive Tweet to his 811,000 followers about a coin has at times resulted in dollars flowing into the specific cryptocurrency.

He has also been known for making some obscure cryptocurrency predictions, such as his Tweet about “eating his own d*ck” if proven wrong about his Bitcoin prediction of $1 million by 2020.


The McAfee Crypto Team website is confident and energetic about the influence McAfee has with his tweets, stating:

Within the cryptocurrency industry, nothing can match the power of a McAfee tweet. Frequently, a single tweet has resulted in more than a million dollars of investment into an ICO, and multiple currencies have increased more than 100% in price from a single tweet.

The team uses McAfee’s social media reach as its justification for the $105,000 price tag, calling it cheap when compared to other alternatives:

“Given Mr. McAfee’s price of $105,000 per tweet, the cost per investor reached is the least costly of any marketing avenue in the Crypto world. Considering only his own followers, the cost per investor reached is $0.13. Considering his reach beyond his own followers, the cost per investor reached is frequently less than a penny. This is orders of magnitude less than any other approach.”

The website used a poll conducted by McAfee in his tweets, where 50,000 followers contributed. The findings claim that:

“737,000 of his followers buy or sell cryptocurrencies at least once a month. 154,000 buy or sell cryptocurrencies daily.

380,000 have more than 25% of their total assets stored in cryptocurrencies. 259,000 have more than 50% of their total assets in cryptocurrencies.

518,000 have more than $3,000 already invested in cryptocurrencies. 224,000 have over $20,000 invested in cryptocurrencies. This las group alone represents, at a minimum, $4.48 billion in crypto investments.”

McAfee has received some negative feedback from his pay-to-play promotion. McAfee tweeted shortly after the website release about his process for choosing ICOs.

McAfee spoke with The Independent and explained that “I’m the only person in the crypto field that has openly divulged the outrageous amounts of money charged by crypto promoters.”

“It’s embarrassingly huge, but it’s true,” McAfee said. “I have been getting these fees for over six months. I decided to go public with it because I am an advisor to many of these companies and I know that I’m in the cross-hairs of the SEC [US Securities and Exchange Commission], so it is in my interests to prove transparency.”

McAfee also recently announced that he launched a Telegram group focused on chatting “about all things crypto,” and made sure to note that moderators in the group would ban its members upon any “pumping and shilling.”


Dash Spotlight: The Sole Reason Why Reality Check & Truth In Media Are Back

Welcome to the first episode of our Sponsor Spotlight on Dash Digital Cash.

As you may know, Dash Digital Cash is the exclusive sponsor of Reality Check and the Truth In Media project.

After a year “in the dark,” the only way I was able to bring back Reality Check and the Truth In Media project, was through the support of Dash Digital Cash, which I’ve described as a revolutionary cryptocurrency that will change the game for everyone.

In the next Sponsor Spotlight, I’ll explain how that funding was made possible through the unique way Dash Digital Cash operates as money-as-a-service business.

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It’s transferred instantly, in just one second, and is completely anonymous. It costs less than 1 cent to send Dash, regardless of the size of the transaction. One second, less than 1 cent.

The easiest way to buy Dash Digital Cash is on Uphold.com, as explained in the video below:

You can also purchase Dash Digital Cash on exchanges like Bittrex and Poloniex.

To hold and spend small amounts of Dash Digital Cash, you will need a mobile wallet. Dash Digital Cash has mobile wallets available for download in the Apple App Store and on Google Play.

Remember—always consider the amount of Dash you carry and the necessary security measures to protect your crypto.

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Be part of the revolution and start using Dash Digital Cash today.

UK Government Announces New Cryptoassets Task Force

UK Chancellor of the Exchequer Philip Hammond announced a new cryptoassets task force, reportedly to make it faster and easier for financial tech firms to follow complex regulations and a new UK-Australia ‘fintech bridge’ to help UK firms expand internationally.

Chancellor Hammond spoke at the U.K. government’s second International Fintech Conference on March 22. Hammond revealed that the new task force would include representatives from the Treasury, the Bank of England, and the Financial Conduct Authority, Britain’s financial watchdog.

Chancellor Hammond stated:

I am committed to helping the sector grow and flourish, and our ambitious Sector Strategy sets out how we will ensure the UK remains at the cutting edge of the digital revolution. As part of that, a new task force will help UK to manage the risks around Cryptoassets, as well as harnessing the potential benefits of the underlying technology.

The conference joined international investors, UK financial technology industry (fintech) firms and “leading industry figures, regulators and policymakers.”

The Fintech Sector Strategy will include:

— A Cryptoassets Task Force consisting of HM Treasury, the Bank of England, and the Financial Conduct Authority. This will help the UK to be at the forefront of harnessing the potential benefits of the underlying technology, while guarding against potential risks.

— ‘Robo-regulation’ pilot schemes to help new fintech firms, and the financial services industry more widely, comply with regulations by building software which would automatically ensure they follow the rules, saving them time and money.

— Appointing three new Fintech Regional Envoys to ensure the benefits of fintech are felt across the UK.

— Creating a set of industry standards which will enable fintech firms to more easily partner with existing banks.

— Helping new, small fintech firms to provide complex financial services and thereby grow their businesses and reach new customers. Industry and government will work together to create ‘shared platforms’ which will help remove the barriers that these firms face in setting up new systems.

— A Connect with Work programme developed by the government’s Fintech Delivery Panel to help fintech firms to take advantage of the UK’s diverse workforce.

This task force announcements is not surprising; in February the UK Parliament announced the Treasury Committee would be launching a new inquiry into digital currencies and distributed ledger technology.

Chair of  the Treasury Committee, Nicky Morgan, said that “the Treasury Committee will look at the potential risks that digital currencies could generate for consumers, businesses, and Governments, including those relating to volatility, money laundering, and cyber-rime.”

The UK government is reportedly looking to work alongside tech leaders to allow for innovation while protecting the consumer. Charlotte Crosswell, CEO of Innovate Finance said that “this exciting partnership between Innovate Finance and FinTech Australia will foster even stronger ties between the fintech communities of our two countries and is an important step in supporting innovation in financial services on an international scale,” and noted that it “offers an excellent opportunity to work together to share industry best practices, strengthen understanding and knowledge of each other’s fintech markets, and drive progressive regulatory approaches to help our fintech sector grow.”

Calls for regulation in the cryptocurrency market has been increasing recently, including G20 economic leaders discussing regulation deadlines. The U.S. Securities and Exchange Commission (SEC) has also been clear about plans to crack down on cryptocurrency exchanges in the US.

Cryptocurrency businesses across the world have been encouraging regulators to work alongside industry leaders. The UK appears to be attempting to do this, and the US may follow suit.

Binance Announces Plans to Open Exchange In Malta Amid Regulatory Issues in Japan

As reports surfaced recently highlighting a regulation-related dispute with Japan, leading cryptocurrency exchange Binance announced that it is preparing to open up in Malta.

An article published by Nikkei Asian Review late last week reported that Binance would be issued a formal warning from Japan’s Financial Services Authority (JFSA) to shut down its cryptocurrency exchange operation in Japan. The report claimed that the JFSA planned to file criminal charges if Binance refused to stop operations in Japan, and noted that according to the revised payment services law, “cryptocurrency trading services can only be offered in Japan by exchanges that are licensed by the FSA or by those awaiting their license.”

Nikkei claimed that “the exchange has irked the FSA by failing to verify the identification of Japanese investors at the time accounts are opened. The Japanese officials suspect Binance does not have effective measures to prevent money laundering; the exchange handles a number of virtual currencies that are traded anonymously.”

Binance’s CEO, Changpeng Zhao, initially called the report “irresponsible journalism.”

As Zhao mentioned in his tweet, it appeared unusual that the JFSA would not reach out to Binance itself before providing its plans to news sources. Bloomberg reported that a warning to Binance from JFSA was eventually issued “according to a person familiar with the FSA’s plans, who asked not to be named because the information is private.” Zhao reportedly told the publication that while Binance has been working to obtain licensing in Japan, the exchange “decided to remove its staff to avoid a clash with local regulators.”

[RELATED: Binance to Launch Decentralized Cryptocurrency Exchange]

Japanese regulators have been working towards stronger oversight after Tokyo-based cryptocurrency exchange Coincheck was hacked in January; more than $500 million worth of the cryptocurrency NEM was stolen in the incident.

In the midst of regulatory conflict with Japan, Binance announced plans to open an office in Malta. “We are very confident we can announce a banking partnership there soon,” Zhao said, according to Bloomberg.

“After reviewing several different locations, the company decided to invest in the European nation due to its existing pro-blockchain legislation and the stability that it offers financial technology companies through its regulatory framework” Binance stated in its announcement published on Medium. “With plans to substantially grow its operations, there are plans to eventually hire up to 200 people to assist their expansion.”

The announcement was embraced publicly by Malta’s Prime Minister Joseph Muscat and Silvio Schembri, the Parliamentary Secretary for Financial Services, Digital Economy and Innovation.

Malta has been in the process of implementing a Digital Innovation Authority to “to provide legal certainty in the sphere of Blockchain technology and by extension cryptocurrencies,” according to a Malta Independent report.

Binance is a Hong Kong-based cryptocurrency exchange currently ranking #1 in daily trading volume. It was launched through an initial coin offering (ICO) where it sold BNB tokens, which can be used for lower fees on the exchange platform, and opened its doors for trading in the summer of 2017.

Congress Joint Economic Report Dedicates Chapter to Crypto, Blockchain

A new report from Congress — the 2018 Joint Economic Report, used to assess the nation’s economic status and provide recommendations for the upcoming year— includes an entire chapter dedicated to cryptocurrencies and blockchain technology.

The report called for policymakers, regulators, and industry leaders to cooperate and ensure developers can implement these new blockchain technologies, and even called 2017 “The Year of Cryptocurrencies.”

The comprehensive report illustrates blockchain as a “potential tool for securing America’s digital infrastructure,” and points out how “methods of theft, espionage, and vandalism” are shifting “from physical toward virtual.”

Included within the Blockchain section is a statement that the technology is “not only nearly invulnerable to cyberattack but is revolutionizing the way the world conducts commerce and shares information.”

Blockchain is the distributed ledger technology that underlies digital currencies such as Bitcoin. A ledger is the accounting tool that tracks the movement of money from one person or account to another. Conventionally, such records are stored in central locations like banks, headquarters, and Paypal servers. Blockchain revolutionizes ledger technology with a network of distributed ledgers. Instead of one central, authoritative record of all transactions or information, blockchain creates potentially thousands of identical ledgers in computers and servers all over the world.

In “permissionless” proof-of-work blockchain, people compete to validate each transaction in return for a reward. The protocol rewards users for creating and validating entries into the ledger. This reward creates an incentive for competition and gives these validators (“miners” see Box 9-1) new tokens to use in the system. Users who do not earn tokens by performing verifications, i.e., not “miners,” must buy the tokens. This interplay between miners and purchasers create an ecosystem where people have clear incentives and rewards to maintain the distributed ledger for everyone.

The report tracked cryptocurrency’s massive rise during 2017, noting the significant price growth of leading cryptocurrencies Bitcoin and Ethereum, and that both outpaced the Dow Jones Industrial Average and the S&P 500.

The report shared a critical view of cryptocurrencies as a currently viable form of money and stated that “technical and economic limitations” of Bitcoin “hinder its use as a medium of exchange.” The report went on to acknowledge that “If digital currencies become less volatile in the future, valuing items in those denominations could become easier and individuals might begin using them more frequently as a medium of exchange.”

[RELATED: WATCH: Rep Backed By Securities Industry Says Cryptocurrency Undermines Gov’t. Control]

Regulation concerns were also examined in this report, noting that cryptocurrencies, ICOs and exchanges all pose unique challenges. “Their rapid ascension led to instances of new products running afoul of America’s current regulatory framework,” the report noted. “This demonstrated how certain regulatory environments are simply out of touch with the internet age.”

The report concluded that:

Technology presents evolving challenges and generates new solutions. Blockchain technology essentially stores and transmits data securely, in large volume, and at high speeds. So far, the technology has proved largely resistant to hacking, and given this feature, developers first applied it to digital currencies. Yet blockchain has many more potential applications, such as portable medical records and securing the critical financial and energy infrastructure.

The report offered recommendations to policymakers, regulators, and industry leaders in its conclusion:

— Policymakers and the public should become more familiar with digital currencies and other uses of blockchain technology, which have a wide range of applications in the future.

— Regulators should continue to coordinate among each other to guarantee coherent policy frameworks, definitions, and jurisdiction.

— Policymakers, regulators, and entrepreneurs should continue to work together to ensure developers can deploy these new blockchain technologies quickly and in a manner that protects Americans from fraud, theft, and abuse, while ensuring compliance with relevant regulations.”

— Government agencies at all levels should consider and examine new uses for this technology that could make the government more efficient in performing its functions.

This new report offers an extensive interpretation of the rise and future potential of blockchain technology and cryptocurrencies. Other government acknowledgment this week included the House Capital Markets, Securities and Investment Subcommittee, the House Science, Space and Technology Committee and the Senate Banking, Housing and Urban Affairs Committee.


WATCH: Rep Backed By Securities Industry Says Cryptocurrency Undermines Gov’t. Control

Washington, D.C. — The House Subcommittee on Capital Markets, Securities, and Investment (Committee on Financial Services), on Wednesday, held a hearing entitled “Examining the Cryptocurrencies and ICO Markets.”  During the hearing, Rep. Brad Sherman (D-CA) read a statement that called cryptocurrencies “harmful,” and appeared to accidentally admit that cryptocurrency reduces government control of the dollar.

BitsOnline noted that it’s unclear “whether his most infamous statements during the March 14th crypto hearing were on behalf of, or in the stead of, Rep. Carolyn B. Maloney (D-NY).” Notwithstanding, Sherman spoke assertively while reading the statement.

Sherman began by referring to cryptocurrency as “a crock,” and went on to perpetuate pop culture stereotypes and and fears about the industry, saying, “Cryptocurrencies are popular with guys who like to sit in their pajamas and tell their wives they are going to be millionaires. They help terrorists and criminals move money around the world. Tax evaders. They help startup companies commit fraud, take money, and one percent of the time they actually create a useful business.”

As Sherman continued to rebuke cryptocurrency and those who utilize the technology, he seemingly revealed the real reason government fears widespread consumer adoption of cryptocurrency.

“It hurts the U.S. government in two ways,” Sherman said. “Our contr….” Sherman began, as he appeared he was about to say “our control.” Although he stopped himself prior to uttering the entire phrase, he continued by saying, “…our ability to have the US dollar as the chief means of international finance is what has underpinned our ability to impose sanctions,” illustrating that monetary policy and the dollar are used as a system of control by the U.S. government.

It should thus come as no surprise that the top industries funding Sherman’s election campaigns are securities and investment related entities.

According to a report from CryptoCoinsNews, it was revealed on Reddit that Sherman’s top contributor for 2017-2018 is digital payment processor Allied Wallet- a company that stands to encounter significant competition from more efficient and private payment systems that have been created with blockchain technology. Overall, Sherman received $56,700 from the securities and investment industry.

Bank of America recently acknowledged that cryptocurrencies pose a challenge to their earnings, stating that “widespread adoption of new technologies,” including cryptocurrencies, may compel the company to make “substantial expenditures” in order to compete with such innovations.

Certain members of Congress like Rep. Tom Emmer (R-MN), member of the Congressional Blockchain Caucus, showed a better understanding of the technology and its implications.

“This is something that Democrats and Republicans should be celebrating here in Congress not going ‘oh my gosh, this is terrible, we don’t understand it’,” Emmer said.

“I tend to trust people and believe that they’re in these things for good, and that they’re trying to improve their own lives and hopefully the lives of people around them — that old adage that a rising tide lifts all boats. And yet I hear elected officials who don’t have any concept of what we’re dealing with here and how exciting it is, talking about how we got to regulate and create more government infrastructure. I respectfully disagree that that won’t act as a wet blanket on this amazing new technology. I realize there has to be some regulation, but there’s got to be balance,” Emmer said.

Coinbase’s chief legal and risk officer Mike Lempres, Georgetown University law professor Dr. Chris Brummer, and Wilson Sonsini Goodrich and Rosati partner Robert Rosenblum served as expert witnesses at the hearing, which is Congress’ first foray into potential regulatory issues surrounding initial coin offerings (ICOs).

Binance to Launch Decentralized Cryptocurrency Exchange

Leading cryptocurrency exchange company Binance released a statement on March 13th announcing the company is officially developing a public blockchain for a decentralized exchange.

“On the decentralized exchange we’ll have less control. More likely anybody can list any coin. That’s the philosophy of the decentralized exchange, it’s freedom of choice, freedom of investments,” Binance founder and Chief Executive Officer Changpeng Zhao told Bloomberg in an interview.

Regulations and security issues have provided cause for concern regarding centralized cryptocurrency trading platforms. The SEC recently released a statement warning about “potentially unlawful” trading on some cryptocurrency platforms. In addition, there is a history of centralized exchanges succumbing to hacks with Mt.Gox and Bitfinex as examples. As Bloomberg noted, “Since the start of this year, hackers have stolen tokens worth about $700 million from venues in Japan and Italy” and that these “robberies have added pressure on both exchanges and regulators to do more to protect investors.”

Binance appears to be making a move to address these concerns.

Binance announced in their statement that the intentions of this move are to transition from “a company to a community.” Binance further explained in their statement:

After extensively researching decentralized exchange frameworks and analyzing existing implementations, we believe significant improvements can be made in providing Biance users with a level of trading experience to which they are already accustomed. Centralized and Decentralized exchanges will co-exist in the near future, complementing each other, while also having interdependence. We stand here today because we believe that Blockchain technology will change the world. In the face of adversity, we have always elected to tackle issues head-on, instead of retreating. As such, we have decided to officially launch the development of the Binance Chain.

With a centralized crypto exchange, as Binance currently operates, traders are obligated to entrust their crypto assets with a third party platform in order to trade. Cryptocurrencies themselves are typically decentralized; however, when traders store them with centralized third parties, they’re sometimes vulnerable to security breaches. Notably, Binance recently experienced a failed hack attempt.

A decentralized exchange helps to counter the need for third-party trust by functioning as a trading platform while allowing users to trade directly with each other via a peer to peer mechanism. Binance Chain looks to provide a reliable decentralized alternative by focusing on this peer to peer mechanism.

[RELATED: Reality Check: Is Crypto Backed by “Radical Transparency”?]

Decentralized exchanges are not new, as such trading platforms already exist including BitShares and EtherDelta. Even though decentralized exchanges are more difficult to hack, some exchanges lack crucial features and functionality found in centralized exchanges.

One issue faced by further integration of decentralized exchanges is blockchain interoperability, where cross-chain peer to peer transactions is currently an obstacle as differing types of blockchain technologies make it difficult to trade various coins without having a third party to moderate the exchange.

Binance briefly highlighted synchronicity between centralized and decentralized exchanges by stating that the two “will co-exist in the near future, complementing each other, while also having interdependence.”

It appears they plan to use an upgraded Binance Coin. They continued in the statement by saying:

As a public blockchain, Binance Chain will mainly focus on the transfer and trading of blockchain assets, as well as provide new possibilities for the future flow of blockchain assets. Binance Chain will focus on performance, ease-of-use, and liquidity. Binance Coin (BNB) will be upgraded to exist on its own blockchain mainnet, becoming a native coin. At the same time, Binance will transition from being a company to a community.

Zhao noted on Twitter that additional information will be available soon.


Google to Ban Cryptocurrency Ads, Deepening “Crypto Blackout”

(Dash Force News) Google has announced that it will be cracking down on cryptocurrency-related advertising, furthering the “crypto blackout” online.

According to new policies relating to financial services to be rolled out in June, among newly banned content will be anything related to cryptocurrency:

“Cryptocurrencies and related content (including but not limited to initial coin offerings, cryptocurrency exchanges, cryptocurrency wallets, and cryptocurrency trading advice)”

While the spirit of the ban appears to be targeted at ICOs and speculation, it will also affect other cryptocurrency information as well, from simple usage guides to wallets, news sites, general information, and more.

Google joins Facebook in the crypto ad blackout

Google follows in Facebook’s footsteps in the crypto ad crackdown. Earlier this year, Facebook similarly banned cryptocurrency-related advertising. Now with Google joining in the ban, two of the most powerful online advertising networks have blocked out cryptocurrency. This united front will make reaching new users considerably more difficult, and will increase the value of earned media, solidifying gatekeeper status by major publications. Additionally, it may also give rise to more covert approaches to dodging ad filters, with cryptocurrency-related content packaged as something else.

Ad difficulties increase the importance of Dash’s partnerships and in-person promotions

Dash’s competitive advantage over other cryptocurrencies is its significant treasury, which can fund all manner of promotional initiatives in-house. However, the recent ad blackout has significantly complicated purely advertising-related proposals, reducing the ability to simply fund Dash ads to increase its user base. This situation increases the importance of other promotional measures such as conference sponsorships and speaking opportunities, as well as grassroots promotional initiatives including meetup programs.

Additionally, difficulties in running normal advertisements increase the value of strategic media partnerships. For example, rather than simply advertising on major ad networks utilized by media outlets, Dash sponsored US-based radio show and podcast Free Talk Live directly, bypassing ad bans by partnering directly with the media platform. Similarly, Dash exclusively sponsored independent journalist Ben Swann, lending his impressive reach to Dash, as well as making a strong statement about uncensored media made possible only by Dash’s DAO.

Cryptocurrency Exchange Offers $250K Bounty for Arrest of Failed Hackers

Binance, a leading cryptocurrency exchange, is offering a bounty equivalent of $250,000 USD in BNB in cryptocurrency for information that leads to the arrest of the hackers involved in a recent phishing attempt. On top of this, they are maintaining a $10 million cryptocurrency reserve for bounties to nab hackers in the future.

In a statement, Binance addressed the importance of going on the offensive against attempted hacks:

To ensure a safe crypto community, we can’t simply play defense. We need to actively prevent any instances of hacking before they occur, as well as follow through after-the-fact. Even though the hacking attempt against Binance on March 7th was not successful, it was clear it was a large-scale, organized effort. This needs to be addressed.

During the attempted scheme, the Viacoin (VIA) to Bitcoin (BTC) market experienced “abnormal trading activity.” Luckily, Binance’s automatic risk management system was flagged, and all withdrawals were halted immediately. After the incident, Binance quickly released a statement announcing all funds were safe.

The security incident involved some irregularities in the use of API keys, which resulted from a phishing campaign lasting a few months. The actual attack took only two minutes. Binance said in one of their statements:

The phishers accumulated user account credentials over a long period of time. The earliest phishing attack seems to have dated back to early Jan. However it was around Feb 22, where a heavy concentration of phishing attacks were seen using unicode domains, looking very much like binance.com, with the only difference being 2 dots at the bottom of 2 characters. Many users fell for these traps and phishing attempts. After acquiring these user accounts, the phishers then simply created a trading API key for each account but took no further actions, until yesterday.

Further suspicion grew when the phishing accounts on Binance started placing a large number of market buys for Viacoin, a low-value cryptocurrency, through Bitcoin. This low volume cryptocurrency quickly increased to a high price, and 31 pre-deposited accounts were there to sell VIA at that high price. It was at this time the Binance system flagged the trading and withdrawals were cut off when the attempted withdrawal was made.

Binance said, “Not only did the phishers fail to steal any coins, their own coins have also been withheld.”

Binance noted the hackers appeared both organized and patient. They gathered their information throughout a couple months’ time, then chose a coin with a smaller market cap to help “maximize their own gains.”

Binance has shown transparency throughout this incident, with further information from the statement:

After a thorough security check by Binance, we resumed withdrawals. Trading functionality was never affected. There are still some users whose accounts whwere phished by these phishers and their BTC were used to buy VIA or other coins. Unfortunately, those trades did not execute against any of the phishers’ accounts as counterpart. As such, we are not in position to reverse those trades. We again advise all traders to take special precaution to secure their account credentials…..Protecting our traders is and has always been our highest priority.

Report: Egyptian Citizens Exploited in Covert Cryptocurrency Mining

According to a new report from researchers at the University of Toronto, entities linked to the Egyptian government may have been hijacking “Egyptian internet users’ unencrypted web connections en masse” to secretly mine cryptocurrency.

According to the detailed report from the University of Toronto Citizen Lab, researchers identified techniques being used to hijack Egyptian citizens’ computers and mobile devices. Egyptian internet users were reportedly being covertly redirected to malware that used their computers to mine Monero cryptocurrency. The Citizens Lab describes itself as an “interdisciplinary laboratory” focused on “research, development, and high-level strategic policy and legal engagement at the intersection of information and communication technologies, human rights, and global security.”

— Through Internet scanning, we found deep packet inspection (DPI) middleboxes on Türk Telekom’s network. The middleboxes were being used to redirect hundreds of users in Turkey and Syria to nation-state spyware when those users attempted to download certain legitimate Windows applications.

— We found similar middleboxes at a Telecom Egypt demarcation point. On a number of occasions, the middleboxes were apparently being used to hijack Egyptian Internet users’ unencrypted web connections en masse, and redirect the users to revenue-generating content such as affiliate ads and browser cryptocurrency mining scripts.

— After an extensive investigation, we matched characteristics of the network injection in Turkey and Egypt to Sandvine PacketLogic devices. We developed a fingerprint for the injection we found in Turkey, Syria, and Egypt and matched our fingerprint to a second-hand PacketLogic device that we procured and measured in a lab setting.

—The apparent use of Sandvine devices to surreptitiously inject malicious and dubious redirects for users in Turkey, Syria, and Egypt raises significant human rights concerns.

The researchers called the scheme AdHose, which has two modes: spray mode and trickle mode. According to the report:

The Egyptian scheme, which we call AdHose, has two modes. In spray mode, AdHose redirects Egyptian users en masse to ads for short periods of time. In trickle mode, AdHose targets some JavaScript resources and defunct websites for ad injection. AdHose is likely an effort to covertly raise money.

Quartz Media reported the hardware used for implementing AdHose is used for revenue generation as well as a censorship tool. The report stated that the malware blocked certain news outlets such as Al Jazeera, Reporters Without Borders and Human Rights Watch, and redirected users attempting to access certain websites such as former-pornographic website Babylon-X.com and the Coptic Orthodox Church religious website for the pope (CopticPope.org).

Quartz Media explained that with “spray” mode, “any website that affected users tried to visit would redirect their browsers to either an ad network or cryptocurrency mining malware called Coinhive. One scan in January found 95% of devices observed, numbering over 5,700, were affected by AdHose.”

[RELATED: Report: FBI Paid Geek Squad Employees to Spy on Customers]

University researchers conducted tests that identified AdHose middleboxes in a Telecom Egypt “demarcation point,” which may provide evidence of a connection to the Egyptian government, as Telecom Egypt is state-owned.

The maker of the hardware is a Canadian company called Sandvine; the Citizen Lab researchers noted that Sandvine called their report “false, misleading, and wrong.” Sandvine also issued a statement to CoinDesk:

Based on a preliminary review of the report, certain Citizen Lab allegations are technically inaccurate and intentionally misleading….We have never had, directly or indirectly, any commercial or technology relationship with any known malware vendors, and our products do not and cannot inject malicious software. While our products include a redirection feature, HTTP redirection is a commodity-like technology that is commonly included in many types of technology products.

The researchers reached out to Sandvine and its owner Francisco Partners for comment on the discovery. They received a response stating:

A key part of the Sandvine’s innovation process is to ensure that we do not lose sight of the ethical impact of our technology on human rights, freedom of speech, and privacy. Sandvine has taken the approach on regulating access to the components of our solutions that could be sued to infringe on any of these. The usage of our regulatory compliance solutions is controlled by an EULA and software licenses that are required for any components that could conceivably be used to violate human rights, freedom of speech, and privacy.

However, the report stated that Sandvine referred to confidentiality issues as it refrained from commenting on business dealings in Egypt or Turkey. Business dealings with these countries would appear to contradice Sandvine’s Business Ethics Committee review process, in which it has used the World Bank Index to review sales with partners, stating they use “strong safeguards” that Sandvine asserts it maintains “regarding social responsibility, human rights, and privacy rights.”

“We emphasized that we were confident in our research findings, which two independent peer reviews confirmed,” the researchers at Citizens Lab maintained.

SEC Warns of “Potentially Unlawful” Crypto Exchanges

The U.S. Securities and Exchange Commission (SEC) has issued a warning regarding cryptocurrency exchanges; according to the SEC, some exchanges may be in violation of federal laws governing trading.

A statement issued by the SEC on March 7th stated:

Online trading platforms have become a popular way investors can buy and sell digital assets, including coins and tokens offered and sold in so-called Initial Coin Offerings (“ICOs”). The platforms often claim to give investors the ability to quickly buy and sell digital assets. Many of these platforms bring buyers and sellers together in one place and offer investors access to automated systems that display priced orders, execute trades, and provide transaction data.

A number of these platforms provide a mechanism for trading assets that meet the definition of a “security” under the federal securities laws. If a platform offers trading of digital assets that are securities and operates as an “exchange,” as defined by the federal securities laws, then the platform must register with the SEC as a national securities exchange or be exempt from registration. The federal regulatory framework governing registered national securities exchanges and exempt markets is designed to protect investors and prevent against fraudulent and manipulative trading practices.

“The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not. Many platforms refer to themselves as “exchanges,” which can give the misimpression to investors that they are regulated or meet the regulatory standards of a national securities exchange,” read the statement. “Although some of these platforms claim to use strict standards to pick only high-quality digital assets to trade, the SEC does not review these standards or the digital assets that the platforms select, and the so-called standards should not be equated to the listing standards of national securities exchanges.”

The SEC statement included a clear warning to unregistered trading platforms:

A platform that trades securities and operates as an “exchange,” as defined by the federal securities laws, must register as a national securities exchange or operate under an exemption from registration, such as the exception provided for ATSs under SEC Regulation ATS. An SEC-registered national securities exchange must, among other things, have rules designed to prevent fraudulent and manipulative acts and practices…

…Further, a national securities exchange must itself comply with the federal securities laws and must file its rules with the Commission.

“In advancing the SEC’s mission to protect investors, the SEC staff will continue to focus on platforms that offer trading of digital assets and their compliance with the federal securities laws,” the statement concluded.

The statement was issued a week after reports that the SEC has been sending out subpoenas to companies that have launched ICOs. According to TechCrunch, it appeared “that the SEC is requesting details of sale structures and the pre-sale elements to them, which often include deep discounts for those investing large sums or committing to an ICO early on.”

Coindesk reported that “few attorneys or industry stakeholders are willing to talk on the record about the investigations,” and noted thatTechCrunch founder Michael Arrington, “who raised $100 million to start crypto hedge fund, Arrington XRP Capital,” acknowledged receiving a subpoena.

According to Fox Business, the commission has been “looking at several ICOs to ensure they are not violating securities laws.” SEC Chairman Jay Clayton recently told the network that he has observed a significant portion of ICOs and while “it’s a technology that I really think is pretty cool and can change the way people do business at a great deal of efficiency,”  he said he’s found that they qualify as securities offerings and they must follow SEC regulations.

Clayton told Fox Business:

“Many ICOs and many of the ones I’ve looked at specifically are securities….for some reason, people selling ICOs seem to think they don’t need to follow either path; they seem to think they can have the best of both worlds: a limited disclosure from a private placement and public trading and public offering of the token.”

“Abide by the law,” Clayton added. “We are watching. Others are watching.”


Starbucks Sees the Potential of Cryptocurrency

Watch Ben Swann Explain Cryptocurrency:

(Dash Force News) Howard Schultz, the executive chairman and former CEO of Starbucks, said that “one or a few legitimate” cryptocurrencies are coming, but does not “believe that bitcoin is going to be a currency today or in the future” and believes in the underlying blockchain technology.

Schultz clarified that he brought up the topic not because Starbucks is developing or investing in cryptocurrencies, but wanted to discuss the long-term potential of a “consumer application in which there’s trust and legitimacy” when thinking “about the future of our company and the future of consumer behavior.” He went on to mention that he could see a future where the coffee chain would be completely cashless.

The current CEO, Kevin Johnson, reiterated that the coffee giant is not investing in blockchain, but did say they are testing a cashless store in Seattle. Johnson recognized that “payment and payment platforms are continuing to evolve” and wants Starbucks to integrate new technology before competitors.

Consumer experience is a top priority

Schultz receives praise in the business community for building the modern Starbucks empire because he focused on consumer service and experience, which now qualifies him to recognize the importance of identifying consumer behavior and desires. Starbucks predicts future payment systems to evolve with how consumer desires evolve, much the same as Schultz evolved American coffee culture by recognizing, satisfying, and shaping consumer desires. Key to cryptocurrency adoption is not only to supply a great product, but also to show consumers a great experience and why to use cryptocurrency. Misunderstanding of the latter has partially led to a debate between Bitcoin, altcoins, and distributed ledger technology.

While the topic of whether Bitcoin or other cryptocurrencies will offer the best technology is a subject of frequent debate, the business aspects to identify consumer behavior and to satisfy consumer desires can sometimes be overlooked. Naysayers doubt cryptocurrencies, but think distributed ledger technology can be integrated with current systems to better satisfy consumer desires. Cryptocurrencies have relatively high switching costs when compared to the ability of traditional payment systems to satisfy consumer desires even though the technology is inferior. Large scale adoption requires an appeal to as many consumers as possible, which requires satisfaction of consumer desires that reach beyond technology.

Dash recognizes additional elements of a strong consumer-focused currency

Cryptocurrency seeks global adoption, but many consumers are not interested in technical or economic arguments, which Dash can harness. Dash has the ability to fund omnichannel outreach to potential users not only through technical and economic avenues, but also through regular consumer avenues. Dash Force News attempts to boil down the crypto news into quick reads for busy consumers that do not want to spend time searching crypto forums. Dash sponsors sports to reach potential users that are sports fans. Dash sponsors investigative journalists to reach potential users that are news junkies. Dash partners with other businesses to bring simple and useful services to consumers right away.

Dash has the ability to reach large scale adoption with Evolution because it is an attempt to identify and solve consumer desires of simplicity. Evolution attempts to make sending and receiving Dash easy by pushing long cryptographic addresses to the backend. Evolution will also bring merchants straight to the Dash wallet eliminating the need for consumers to spend time and resources to find crypto-accepting merchants. In addition to Evolution, the DAO of Dash allows for evolving consumer needs to be continually identified and satisfied, which is key to achieve and maintain large scale adoption.


Written By: Justin Szilard

Reality Check: Is Crypto Backed by “Radical Transparency”?

Unless you have been hiding under a rock, you’ve been hearing about cryptocurrency, Bitcoin and dozens of coins as being either the future of currency, or causing the biggest bubble ever.

One of the biggest criticisms of cryptocurrency is that it’s just made up money, that it’s not backed by anything.

But is that true?

What if I told you that crypto, unlike dollars or even gold and silver, has the greatest backing of all: radical transparency.

Let’s give it a Reality Check you won’t get anywhere else.

Radical transparency. In the spirit of radical transparency I should mention once again that Reality Check and Truth in Media are exclusively sponsored by Dash Digital Cash, which is of course, a cryptocurrency.

Cryptocurrencies are in the news every day, from Bitcoin’s meteoric rise in December to over $19,000 a coin, to the drop in February to below $7,000. You’ve heard everything from how crypto is the future, to crypto is a scam. The biggest bubble since the Dutch tulip bubble which burst in the year 1637. Yes, it happened. And yes, that comparison is being made in media.

One of the biggest complaints in media about crypto is that it is simply made up money. It’s not backed by anything.

Not like dollars and gold. But is that true?

The U.S. dollar came off the gold standard in 1933 and then fully abandoned it in 1971 under President Nixon.

By 1973, the U.S. had entered into agreements with Saudi Arabia to create the petrodollar. they agreed to use American dollars for paying against oil contracts.

Oh yes, oil. The “fuel of the future” is what backs the U.S. dollar?

Maybe not. Maybe it’s something completely different. Peter Thiel puts it this way:

“You will not be able to pay your taxes in bitcoin. You have to pay them in dollars. If you don’t pay them with dollars, there will be people who will show up with guns to make you pay them.”

From the Daily Reckoning: “Coercion is what holds the u.s. dollar system together. ‘tax-driven money’ is the phrase that economists use to describe the theory. it applies to all sovereign currencies.”

Though, as we have reported at TruthInMedia.com, three states are now considering state taxes to be paid in crypto.

So what about commodity-backed currency, like gold or silver? At least there is a physical asset there, right?

The use of precious metals as money goes back nearly 3000 years.

According to Ross Ashcroft’s Renegade Inc., the founder and chairman of Goldmoney “James Turk argues for a return to the gold standard because ‘only gold is outside the control of politicians’. That may be true, but it’s not outside the control of mining corporations, whose interests are unlikely to coincide with those of the wider population.”

And while gold has a fixed supply that can’t be inflated, it also hasn’t been easy to audit.
And that brings us to cryptocurrency.

With crypto, you know exactly how much is out there, where it all is, and how often it moves.

Forbes Magazine writes:

“…Vanguard founder Jack Bogle and Nobel Prize winner Professor Joseph E. Stiglitz from Columbia University. They have both attacked bitcoin saying that it’s a “bubble,” comparing it to many dotcom companies that were really shell companies offering little value and not ‘backed by anything.’ Stiglitz actually went so far to say bitcoin should be outlawed and said it doesn’t serve any useful social function.”

No useful social function? That argument is really not true.

Cryptocurrencies like Bitcoin, Dash, Ethereum, Litecoin, Ripple, Bitcoin cash, and many others are backed by blockchain technology. And blockchain creates radical transparency through antifragile decentralization.

In other words, blockchain is a secure digital ledger and a distributed database, tracking transactions anonymously and replicating them to prevent data loss. It’s nothing like the trust we instill in our current financial system, which explains its useful social function.

Joel Valenzuela from Dash Force News explains:

“The whole point of a secure public ledger for financial transactions was to remove the need for trusting an institution like a bank to not only hold your money, but also maintain an accurate copy of all transactions and not engage in financial trickery.”

Now let that sink in. The power of blockchain, upon which most crypocurrency is built, is to actually be able to securely remove the financial middleman.

The mysterious Satoshi Nakamoto, in his whitepaper, writes:

“The traditional banking model achieves a level of privacy by limiting access to information to the parties involved and the trusted third party. The necessity to announce all transactions publicly precludes this method, but privacy can still be maintained by breaking the flow of information in another place: by keeping public keys anonymous. The public can see that someone is sending an amount to someone else, but without information linking the transaction to anyone. This is similar to the level of information released by stock exchanges, where the time and size of individual trades, the ‘tape,’ is made public, but without telling who the parties were.”

The goal of true financial privacy is to break the link between an open and auditable network and true identities of the users.

Blockchain technology is facilitating this, allowing even silver currency transactions to be stored as is done by lodecoin.

It’s the power of blockchain that creates what Valenzuela calls “trustlessness.” For instance, Dash Digital Cash does this by “trustlessly mixing funds with a few other parties so that an anonymized transaction can’t be linked back to you, all the while keeping everything publicly visible. There’s incredible value to being able to maintain privacy while keeping the main advantage of cryptocurrency: trustlessness.”

What you need to know is that word, trustlessness, is a powerful one.

So I’ll say it again… trustlessness. Valenzuela says it better than I can, so I will quote him here.

“You don’t have to trust that the network is being used in a certain way. You don’t have to trust that it’s well-distributed, and no one party (or small group of parties) controls a very small portion of the supply. You don’t have to trust any developers or administrators to tell you that the network is running fine. You can see for yourself.”

Radical transparency.

That’s Reality Check. Let’s talk about that right now on Twitter and Facebook.

Venezuela’s Government-Backed Petro Faces Obstacles, Scrutiny

For years, Venezuela has been on a path of increasing economic turmoil. Suffering from one of the most notable economic collapses in modern times, the country faces mounting debt and hyperinflation, rigged elections, and weakened opposition to those in power while citizens are suffering from hunger and violence.

President Nicolás Maduro’s solution is launching the first government-backed cryptocurrency, the petro, which claims to be backed by oil and reportedly raised $735 million in its pre-sale last week. Each token is said to be backed by one barrel of oil. According to Fortune, the petro appears to be a ploy to raise money to get around sanctions placed on Venezuela, which prevent the country from issuing bonds and securities in the U.S. financial market. The Treasury Department noted that “U.S. persons that deal in the prospective Venezuelan digital currency may be exposed to U.S. sanctions risk.”

Controversy has ensued around the petro cryptocurrency from inside and outside Venezuela, with critics claiming that the petro isn’t actually a cryptocurrency. Opposition leaders have described the petro as an “illegal debt issuance that circumvents Venezuela’s majority-opposition legislature,” according to Reuters.

The Guardian reported that lawmaker Jorge Millan said that the petro “is not a cryptocurrency” but rather a “forward sale of Venezuelan oil.”

One standout issue is the discrepancies within the white papers released by the government regarding which blockchain the petro will rely on.

Leading up to the pre-sale that launched on February 20th, the pre-sale was said to “consist of the creation and sale of an ERC20 token on the [blockchain] of the ethereum platform. This process will promote and guarantee demand for the petro Initial Offer, which will be made later.” Ars Technica reported that by February 21st, “all mentions of ERC20 had been scrubbed from the white paper. A new version of the paper stated that the presale will ‘consist of the creation and sale of smart-asset on the NEM blockchain platform.'”

Another issue focuses on the reported $735 million in initial coin offering raised, which would put them in the top three valuations for Initial Coin Offerings, or ICOs. Reports indicate that all of the petros held are on three addresses and all transfers have been to one address.

“You have to be really naive to believe the government has in fact sold any petros because the blockchain shows all 100 million petros are still controlled by one address,” software designer Alejandro Machado told Florida’s WLRN Public Radio. WLRN noted that this address belongs to the Venezuelan government.

This suggests that the initial coin offering figure has been manipulated and that the petro hasn’t actually raised any funds.

It’s been noted that the petro also contradicts the very core of cryptocurrencies— decentralization— due to its attachment to the Venezuelan government; instead, it’s more of a digital token under government control that claims to be backed by oil.

As Ars Technica reported:

The Venezuelan government has portrayed petro tokens as backed by Venezuela’s vast oil reserves, but they’re not. The government is merely promising to accept tax payments in petros at a government-determined exchange rate linked to oil prices. Given the Venezuelan government’s history of manipulating exchange rates, experts say investors should be wary of this arrangement.

Chris Burniske of venture capital firm Placeholder told Bloomberg that “the petro is really a top-down hierarchically controlled asset, and it’s much more akin to a new way to tokenize oil.” Burniske added that “with the petro, we really have a new wrapper around oil.”