Category Archives: Bitcoin
Forget Bitcoin. The Blockchain Could Reveal What’s True Today and Tomorrow – WIRED
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As far back as the 1880s, people stood on the curb outside the New York Stock Exchange taking bets on political elections, and newspapers would report the odds as a way of predicting the results at the polls. In the years since, economists refined the concept, and more recently, prediction markets have tapped into the wisdom of the crowds via the internet, forecasting everything from presidential races to sporting events to stock prices.
The concept took a hit in 2012 when a major site shut down amid financial irregularities and pressure from US regulators. But Silicon Valley hasnt given up on the idea. It now sees a new way of building markets that predict the future: the blockchain.
The blockchain is the global ledger that securely records transactions for the bitcoin digital currency, operating outside the control of any central authority. But so many startups and online communities are now applying the same concept to all sorts of other applications. For Joey Krug, the openness of a blockchain could deliver far more powerful prediction markets than ever before, spreading them to a much larger number of people, while keeping regulators at bay. Krug is one of the young technologists behind Augur, a San Francisco nonprofit working to build a service atop the Ethereum blockchain where anyone can launch or join these markets. It doesnt care where youre from, says Krug, a 21-year-old Thiel Fellow. All kinds of people can trade together that werent able to trade before.
Thanks to the counterintuitive dynamics that drive prediction markets, this could eventually create more specific and accurate predictionsan antidote to media pundits and pollsters who bear little cost for getting their forecasts wrong. You put your money where your mouth is, says Andrew Miller, a computer scientist at the University of Illinois Urbana-Champaign who specializes in cryptocurrencies. But like so many other technologists, financial traders, and other freethinkers working to create strangely fascinating new services atop the blockchain idea, Krug is looking even further ahead. He believes Augur, which is still under beta test, can eventually feed real-world truths into any other online application.
Though there are still many questions hovering over all these big ideasparticularly the bit about real-world truthstheyre gaining momentum. Krug and Augur built their operation with $5.3 million in crowdfunding, and others are exploring similar territory, including a service called Gnosis, another project called Bitcoin Hivemind, and even Microsoft, which now offers an Augur service that would allow businesses to run their own internal prediction markets, much as companies like Google already do.
A prediction market is like the stock market, except that youre not buying stock in companies. Youre buying stock in outcomes. Lets say Donald Trump is running for president. A prediction market lets you buy stock in a Trump win or loss. If your prediction comes true, you get paid. If your prediction proves wrong, you get nothing.
As in the stock market, you can also sell your shares. You aim to buy low and sell high. If enough people participate, the trading price of the stock should indicate the likelihood of an outcome. If a prediction pays out at $1 and Trumps stock is trading at 51 cents, that market predicts a 51 percent chance of a Trump victory. This odds-making reflects the efficient market hypothesis, an idea that won the Nobel Prize in economics in 2013. Prices capture information, says Erik Snowberg, an economist and political scientist at the California Institute of Technology. If you have information that says the price is too low, you buy and the price goes up. If you have information that the price is to high, you sell.
In theory, the better your information, the bigger the bet youll make. Using a blockchain, a service like Augur aims to enhance this dynamic by pushing markets across borders and removing all betting limits, roping in more people and more cash. Without such limits, people like Krug argue, the person with the best information can make their bets, which makes for a more accurate market. If you have bet limits, you cant have an informed trader come in and trade with enough capital to move the market and correct it, says Matt Liston, who helped create Augur and now works on Gnosis.
If enough people stake enough money on enough outcomes, betting their own digital currency that they know what will happen, these markets become a way of predicting the future. But thats only part of what Augur does. To pay out, prediction markets must know what happened. Did Donald Trump win or did he lose? In a more traditional prediction market, the house decides. But Augur takes a different path. Krug and his colleagues have also used their blockchain to create an engine for recording outcomes once they arrivea way of inscribing the truth in digital form.
Its not just about predicting what is in the future, Richard Craib, the founder of blockchain hedge fund Numerai, who has invested in Augur. Its about knowing what is happening in the present.
Heres how it works: After one group of people joins a prediction market and bets on an outcome, Augur pays others to identify that outcometo verify what happened. But it doesnt just pay them a flat fee. On its blockchain, Augur houses its own cryptocurrency, a digital token that encourages people to get things right. If youre not telling the truth, you stand to lose a bunch of money, Krug says.
Augur calls its digital token the Rep. This cryptocurrency doesnt let you buy and sell stuff. It tracks your reputationthat is, how often you tell the truth. People bet their Rep tokens that they are indeed telling the truthreporting the facts as they actually are. If most others agree, the system returns their tokens and pays them in cash. Its a way of aligning everyones aims in the same direction, the sort of arrangement that so often characterizes the new breed of business built atop a blockchain. Because its tied to real money, the Rep token ensures that everyone is pulling in the same directiontoward the truth.
Its not just about predicting what is in the future. Its about knowing what is happening in the present. Richard Craib
Theres always the risk that the majority will deny the facts, somehow overriding the monetary incentive. Enormous bribes could be a problem, for instance. There may be cases where you benefit by cheating, says Miller. If everyone goes toward the truth, you have an incentive to go along with the truth. But if everyone deviates from the truth, there is incentive to deviate. Still, many people seem to have faith in the idea. The Rep now enjoys a $89 million market cap, up from $50 million at the end of February.
Ultimately, Krug hopes to create a service that feeds more than just prediction markets. Augurs reporting engine, he believes, could serve as the foundation for other applications that rely on real-world data. As he explains, it could help automate any financial contract, from options and derivatives to insurance contracts and credit default swaps. Should you be paid because a company defaulted on its debt? Check the Augur blockchain to see if the company really did.
If Augur gains true scale, other possibilities arise. If, say, Trumps national security adviser steps down and Augurs Rep-funded reporters verify his resignation, that fact gets burned into a blockchain. Any application can then make use of this digital fact, from Wikipedia to Facebook to Google search results. In an age when fake news bounces around Facebooks echo chambers and presidential tweets see no difference between online hoaxes and the careful reporting of the New York Times, the possibility of creating a digital market for facts becomes a powerful idea.
Like so many ideas that bubble up from the world of bitcoin, the concepts behind Augur are both strange and perhaps overly optimistic. The instability of the Ethereum tokens that people use to make bets on these markets could undermine their accuracy, says David Rothchild, a researcher at Microsoft. And the Augur reporting engine, lacking a critical mass of participants, remains unproven. But in an age when so many people feel so unsure about not just the future but the facts in the present, such big ideas are at least worth a try.
Update: This story has been updated to show that Gnosis is not technically a spinoff of Augur.
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Forget Bitcoin. The Blockchain Could Reveal What's True Today and Tomorrow - WIRED
4 Ways To Tell If Bitcoin Is In A Bubble – Forbes
Forbes | 4 Ways To Tell If Bitcoin Is In A Bubble Forbes No one wants to be on the wrong side of a bubble. If you invested in dot.com stocks the end of 1999 or bought a house with an adjustable-rate mortgage in 2008, you know exactly what I mean. When it comes to the cryptocurrency Bitcoin, there's every ... |
With Bitcoin, the Smart Money Is Staying Put – CryptoCoinsNews
The Bitcoin community is abuzz with talk of an impending fork, with wildly divergent opinions as to whether or not this is bearish or bullish for the asset. One well-known pundit in the community was quoted as saying that the smart money left a few days ago.
Of course, it goes without saying that I dont have a crystal ball and cant say for a certainty that this is just plain wrong, but I believe that it is.
Lets look at a long-term Gann setup on a 4-hour chart:
I note that price fell hard off the 1st arc (blue) and then worked its way back all the way to the 1st arc pair (red), where it faltered again. BUT, the fall, as harsh it was to those leveraged long, still made a higher low. Now, of course, it could fall again, making a lower low, but there is no reason that I can see to expect that to happen. This arc pair has been difficult. Pricetime is making its 3rd effort to get through the pair. It may falter yet again. But it is making higher highs and higher lows as it works its way through. This is a bullish indicator.
Of course, we wont really have a confirmed buy signal until we get a close on the sunny side of the pair. I cant say whether or not the asset will rally strong to the top of the pair tomorrow, or if it will move sideways through the pair for the next week. But it seems that it wants to get to the other side. What will the terrain look like when it gets to the sunny side of the pair? It looks quite lovely 🙂
This is the same chart we were looking at above, only this time we are seeing where the long-term 2nd arc pair is (dark green arc). We also see the shorter-term bull setup . The 5th arc pair on the short-term setup intersects the long-term 2nd pair at a new ATH in the neighborhood of $1900.
Do I know for a certainty this will happen? Of course not. But it is an eminently reasonable target based upon the geometry. However, I must stress again that it is a wise decision to wait until a buy signal is given before leveraging long. It is hard to be patient, but until we get the signal we cant know for sure if the market agrees with us, or not
Happy trading!
Remember: The author is a trader who is subject to all manner of error in judgement. Do your own research, and be prepared to take full responsibility for your own trades.
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With Bitcoin, the Smart Money Is Staying Put - CryptoCoinsNews
Jackson pastor convicted in Bitcoin scheme – Asbury Park Press
SCOTUS nomination hearing day 2; Man sentenced to 40 years for murdering Rutgers student; Sesame Street's newest neighbor APP NewsBreak
In this file photo, Pastor Trevon Gross of Hope Cathedral Church in Jackson prays during a Sandy grief relief seminar at the cathedral. Gross has been found guilty of accepting bribes and other crimes.(Photo: Robert Ward / Staff Photographer)Buy Photo
A popular Jackson Township pastor has been convicted of illegally allowing Bitcoin scammers to launder dirty money through the pastor's credit union in exchange for kickbacks.
The federal jury in New York City found Trevn Gross, 52, pastor at Hope Cathedral in Jackson and former chairman of the now-defunct Helping Other People ExcelFederal Credit Union (HOPE FCU), guilty of one count eachof receipt of corrupt payments as an officer of a financial institution, conspiring to make or receive corrupt payments, obstructing a regulatory investigation andmaking false statements to regulators, according to the U.S. Attorney's Office for the Southern District of New York. The verdict was returned Friday following the pastor's trial. He was accused of accepting $150,000 in bribes but pleaded not guilty to the charges.
The scheme began in Florida, where Anthony R. Murgio ran Coin.mx, a bitcoin exchange service, with help from Yuri Lebedev, prosecutors said. Investigators charged Murgio and Lebedev with using a bogus antiques exchange as a front for the bitcoin service, skirting registration and reporting requirements on $10 million worth of bitcoin transactions. A bitcoin is a computer-generated digital currency that is used worldwide and is untraceable in most cases.
The owner of Coin.mx, Israeli national Gery Shalon, was also tied to a 2014cyber attack against JPMorgan Chase bank, which federal investigators called the largest-ever theft of customer data from an American financial institution.
Murgio, Lebedev "and their co-conspirators engaged in substantial efforts to evade detection of their unlawful Bitcoinexchange scheme by operating through a phony front company called 'Collectibles Club,' and by maintaining a corresponding phony'Collectibles Club' website," according to a criminal complaint against all three. They "sought to trick the major financial institutions through which they operated into believing their unlawful Bitcoin exchange business was simply a members-only association of individuals who discussed, bought, and sold collectible items, such as stamps and sports memorabilia."
Q & A:Bitcoin explained
Murgio and his associates opened bank accounts in the name of the dummy organization one of them in New York and told their customers to lie to banks about what they were buying through Coin.mx, according to the complaint.
Murgio and Lebedev roped in Gross in 2014, according to the complaint. Lebedev offered up $41,000 of his own money to help convince Gross to let him, Murgio and their associates take over HOPE FCU, a federal credit union based alternately in Lakewood and Jackson thatcatered to "primarily low-income members."
Gross had chaired the credit union's board. With Gross' help, Murgio "installed his co-conspirators, including Lebedev, on HOPE FCU's board of directors and transferred Coin.mx's banking operations to HOPE FCU," according to the complaint.
MIAMI JUDGE:Bitcoin is not money
The Florida-based crew used HOPE FCU "as a captive bank" into 2015, according to a March 2016 statement from then-U.S. Attorney Preet Bharara, but the National Credit Union Administration which charters and supervises federal credit unions eventually caught on to the "substantial payment processing activity" that was going on there. The regulators "forced HOPE FCU to cease engaging in such activity."
Murgio moved his exchange offshore and the regulators put HOPE FCU into conservatorship before killing it altogether, Bharara announced at the time.
According to a November2015 statement from the regulatory agency, HOPE FCU had 110 members and $626,529 in assets just before it was liquidated.
Murgio, 34, of Tampa, Florida,pleaded guilty in January to one count of conspiracy to operate an unlicensed money transmitting business, prosecutors said. The same jury that found Gross guilty also convicted Lebedev, 39, of St. Johns, Florida, of one count of making corrupt payments to an officer of a financial institution, participation in a conspiracy to make and receive corrupt payments, obstructing the regulators' examination, making false statements to regulators, wire fraud, bank fraud and conspiracy to commit wire and bank fraud.
JACKSON: Council bans dorms amid accusations of bias
Gross is scheduled for sentencing on July 20. He faces up to
Hope Cathedral's website still named Gross as pastor on March 21, as well as his wife, D. Qwynn Gross.
Gross "accepted his call to preach at a very young age. He was licensed to preach at the age of 14. Since that time, he has actively prepared for pastoral ministry," according to his biography on the church's website. "With degrees from the University of Virginia, Duke University and further graduate work at Harvard University, Pastor Trevn has a passion for teaching the Word of God. His desire is to see people added to the family of God and growing in their faith so that they will see God's purposes for their lives unfold."
Gross could not be reached for comment. He faces 30 years in prison.
Henry Klingeman, Gross' defense attorney, said in an email to Newsweek magazine that, On behalf of Pastor Gross, we will now seek a judgment of acquittal from the court and if and when the time comes a fair and lenient sentence.
Alex N. Gecan: 732-643-4043; agecan@gannettnj.com
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Jackson pastor convicted in Bitcoin scheme - Asbury Park Press
Is This Massive Power Struggle About To Blow Up Bitcoin? – Forbes
Forbes | Is This Massive Power Struggle About To Blow Up Bitcoin? Forbes Bitcoin's price plunged 25% over the weekend on rumors of a conspiracy theory to take over the network. Long-simmering tensions between two factions hardened, with each side threatening the other with everything ranging from lawsuits to software ... Bitcoin Scaling: Voorhees Says Algo Change Absurd And Reckless Top 6 Companies and Projects Supporting Both SegWit and Bitcoin Unlimited Bitcoin Prepares For an Ugly Breakup |
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Is This Massive Power Struggle About To Blow Up Bitcoin? - Forbes
BTCC CEO Bobby Lee On Why The Chinese Probably Aren’t Using Bitcoin To Evade Capital Controls – Forbes
Forbes | BTCC CEO Bobby Lee On Why The Chinese Probably Aren't Using Bitcoin To Evade Capital Controls Forbes Bobby Lee is chief executive of BTCC, one of the world's longest-running cryptocurrency exchanges. He got into bitcoin early through his brother, Charlie Lee, the creator of Litecoin, the cryptocurrency often called digital silver, as opposed to ... |
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BTCC CEO Bobby Lee On Why The Chinese Probably Aren't Using Bitcoin To Evade Capital Controls - Forbes
Bitcoin’s fake news problem – FT Alphaville (registration)
FT Alphaville (registration) | Bitcoin's fake news problem FT Alphaville (registration) Bitcoin was designed to be self limiting and scarce so as to endow it with value. But the limitation wasn't just applied to the number of coins in circulation, it was also applied to the number of transactions/data that can be processed in any given ... FIRST BITCOIN CAPITAL Corp. Subsidiary COINQX.com is First ... Bitcoin Unlimited at Almost 40%, Chandler Guo to Join |
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Bitcoin's fake news problem - FT Alphaville (registration)
Bitcoin Is Finally Starting to Settle Down – Fortune
Bitcoin regained its footing on Monday, having suffered its heftiest falls since early 2015 between Thursday and Saturday as investors sold the digital currency on worries about its future.
Having soared to an all-time high of $1,350 on the Bitstamp exchange on March 10, on speculation that regulators could approve the first U.S. bitcoin exchange traded fund the following day, the digital currency then slipped back.
Its falls began accelerating on Thursday and it hit a five-week low of $944.36 on Saturday. But bitcoin recovered a little on Sunday and built on those gains on Monday, climbing around 2.5% to roughly $1,050 by 18:15 GMT.
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Bitcoin experts said its steep losses were driven by a longstanding, and intensifying, row over whether - and how - to increase the capacity of the "blocks" that bitcoin transactions are processed in, so as to make sure there are no delays in transactions being finalized.
"The bitcoin scaling debate is a risk for the network and highlights core issues in terms of governance and this is where more nimble crypto competitors see advantages in fleshing out their capabilities sooner," said Charles Hayter, CEO of digital currency analysis website Crytocompare, in London.
Related: This New Tactic Might Finally Lure Big Investors to Bitcoin
At the same time that bitcoin was plunging, a newer, rival "cryptocurrency" was soaring: ether. The digital currency behind Ethereum - a project that some experts say holds more potential than bitcoin - has almost tripled in value this month, jumping to record highs of around $45.
Some experts said traders were selling bitcoin and buying ether, which was exacerbating the falls in the original cryptocurrency.
"Traders in the space are looking for better returns in the more risky and nascent cryptos such as Dash, Monero and Ethereum (and are) looking to replicate the extraordinary returns that bitcoin saw in its early days," added Hayter.
U.S. regulators dashed Cameron and Tyler Winklevoss's bitcoin ambitions earlier in the month by rejecting their application to list an exchange-traded fund linked to the digital currency.
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Bitcoin Is Finally Starting to Settle Down - Fortune
Bitcoin takes a beating while rivals soar to all-time highs – MarketWatch
Call it the schadenfreude trade.
Bitcoins price is taking a beating, having shed about one-fifth of its value over the weekend. At the same time, its biggest rivals in the cryptocurrency space are ascendent: The price of a single ethereum token, the second-largest cryptocurrency by market capitalization, touched an all-time high above $50 over the weekend just as bitcoins losses were beginning to accelerate.
Bitcoiners have widely attributed the drop to fears that the bitcoin network might split in two, which is ironic: Ethereum suffered that exact fate over the summer when a contingent of its users refused to accept a mandatory software update that wouldve, among other things, amended the ethereum blockchain to return some of the $50 million worth of tokens stolen during the DAO hack.
Read: Price of bitcoin plummets over threat that virtual currency will split
Bitcoin US:BTCUSD traded as low as $947 a coin on Saturday, down from around $1,260 a coin on Thursday. That was its highest level since March 10, when the Securities and Exchange Commission rejected a proposed rule change that wouldve allowed for the creation of the first bitcoin exchange-traded fund, sparking a brief selloff.
The two moves are likely interrelated: Data provided by CryptoCompare, a company that supplies data and analytics about the cryptocurrency market, suggest that ethereum has largely benefited from bitcoins decline: The bulk of trading in ethereum has been conducted in bitcoin, trading volumes show, suggesting that worried investors are swapping their bitcoins for ethereum.
Ethereum isnt the only cryptocurrency benefiting from bitcoins selloff: Dash, the third-largest cryptocurrency by market cap, broke to an all-time high above $100 a coin on Monday. Monero, the fourth-largest digital currency, touched an all-time high above $20.
The bitcoin selloff started around the time that AntPool, the largest collective of bitcoin miners, on Friday adopted a controversial software update known as bitcoin unlimited. The proposed update is what's known as a hard fork, meaning that, once it receives a certain baseline of support, everyone running the bitcoin software will either need to accept bitcoin unlimited, or risk being shut out of the bitcoin network.
As of Monday, bitcoin unlimited has the highest level of support among any of the proposed solutions to whats known as the scalability problem: The fact that the bitcoin network is extremely limited in terms of the transaction volume that it can handle.
Critics of bitcoin unlimited feel it would strengthen the control that a small group of miners have over the network.
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Bitcoin takes a beating while rivals soar to all-time highs - MarketWatch
New Jersey Pastor Accepted Bribes of $150000 in Bitcoin Scheme – Newsweek
A New Jersey pastor was found guilty of pocketing $150,000 from shady bitcoin traders in exchange for giving them control of a credit union he headed so they could run it as a front for their bitcoin exchange.
The pastor, Trevn Gross, was found guilty along with programmer Yuri Lebedev by a Manhattan federal court jury on Friday. Anthony Murgio, the founder of the exchange, Coin.mx, pleaded guilty in January.
Related: Bitcoin just became more valuable than gold. Why does the price keep rising?
In 2013, Murgio founded Coin.mx and Lebedev helped run it. The exchange operated through a phony front company called Collectables Club in order to fool banks into thinking illegal bitcoin transactions were legitimate sales of stamps and sports memorabilia. By posing as a site for philatelists and sports nerds and by miscoding credit and debit card transactions, the pair tricked banks into processing more than $10 million in bitcoin-related deals, according to prosecutors.
The pair also sold bitcoins to victims of ransomwarecyberattacks that involve hackers electronically blocking access to victims computers until bitcoin ransoms are paid. In doing so, Murgio, and his co-conspirators knowingly enabled the criminals responsible for those attacks to receive the proceeds of their crimes, an FBI press releasesays.
Gross joined the scheme in 2014, when Murgio and Lebedev bribed him so they could take control of the Helping Other People Excel Federal Credit Union in Jackson, New Jersey, of which he was chairman. That allowed them to transfer the illegal bitcoin transfers they were running through Coin.mx to the credit union, which enabled them to avoid scrutiny from banks about what they were really doing, prosecutors said in a press release. Trevn Gross, a pastor and former chairman of the Helping Other People Excel Federal Credit Union, arrives for a hearing at the Manhattan federal courthouse on March 4, 2016. REUTERS/Brendan McDermid
When the banks caught on to their scheme, acting Manhattan U.S. Attorney JoonKim said in a statement, Lebedev and others bribed Trevn Gross so they could have a captive credit union to process those transactions, undermining the credit unions safety and solvency. The credit union, which had 110 members and assets of about $626,000, was shut down by the National Credit Union Administration in 2015.
The website for Jacksons Hope Cathedral lists Gross as its lead pastorand says he was licensed to preach at the age of 14 and founded the ministry in 2002. With degrees from the University of Virginia, Duke University and further graduate work at Harvard University, Pastor Trevn has a passion for teaching the Word of God, the site states, adding that his wife is also a pastor at the church.
Prosecutors have also said Coin.mx was owned by Gery Shalon, an Israeli who has been charged with overseeing an enormous hacking scheme that stole the personal information of about 83 million JPMorgan Chase customers, Reuters reported. Shalon was extradited to the U.S. last year and has pleaded not guilty.
Defense attorneys for Lebedev did not respond to an email seeking comment. Grosss defense attorney, Henry Klingeman, said in an email, On behalf of Pastor Gross, we will now seek a judgment of acquittal from the court andif and when the time comesa fair and lenient sentence.
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New Jersey Pastor Accepted Bribes of $150000 in Bitcoin Scheme - Newsweek