Dutch Bank Flustered Over the Amount of Electricity Bitcoin Consumes

Dutch bank ING is flustered over the fact bitcoin consumes so much energy. Recently, the bank released a report saying bitcoin transactions consume as much electricity as a house does in a month. They seem to believe this is problematic, since traditional electronic payment methods do not use near as much energy, according to the bank. They went on to say fiat cash will still be how people get paid and pay taxes.

An ING senior economist, Teunis Brosens, explained why power usage is so high. “By making sure that verifying transactions is a costly business, the integrity of the network can be preserved as long as benevolent nodes control a majority of computing power.”

The economist then went on to compare bitcoin energy consumption to his household appliances. A Business Insider article captured his thoughts:

This number needs some context. 200 kWh is enough to run over 200 washing cycles. In fact, it’s enough to run my entire home over four weeks, which consumes about 45 kWh per week costing €39 of electricity (at current Dutch consumer prices).

Trusted Third Parties Equals Less Energy Consumption

The ING banker went on to mention that bitcoin’s energy usage model stands in “stark contrast” with legacy financial systems’ energy consumption. He said bitcoin consumes an “exponentially larger” amount of energy. The banker made it seem as if Bitcoin were going to drain all the world of electricity if people do not continue to use the old, “trusted” payment gateways.

The Business Insider article provided the banker’s quote: “Bitcoin’s energy costs stand in stark contrast to payment systems that have the luxury of working with, trusted counterparties. E.g. Visa takes about 0.01kWh (10Wh) per transaction which is 20,000 times less energy.”

Fiat Money is Here to Stay, Say the Bankers

The ING banker concluded by saying that fiat money is here to stay. People will still continue getting their salaries paid in fiat, and they will continue paying tax in fiat. The banker seemed to imply that innovation was unnecessary and legacy financial systems were here to stay, because government and central banks said so. It will be interesting to see what people think about the energy consumption of bitcoin compared to legacy system electricity usage.

Do you agree with the bankers? Does bitcoin power consumption cause a problem? Should people rely on centralized, trusted third parties since energy consumption is so high? Let us know in the comments section below.

At Bitcoin.com there’s a bunch of free helpful services. For instance, have you seen our Tools page? You can even lookup the exchange rate for a transaction in the past. Or calculate the value of your current holdings. Or create a paper wallet. And much more.

Source : News Bitcoin

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Bank of America Report: Bitcoin's True Value 'Impossible to Assess'

A potential move by global brokerages to offer products around cryptocurrencies could have a big impact on the wider market, analysts at Bank of America Merrill Lynch wrote.

In an Oct. 16 research note entitled "Introducing cryptocurrencies – what are they good for?", the analysts tackle bitcoin as well as other cryptocurrencies such as ethereum and XRP. The note both covers the basics of the market and dives more specifically into the growing galaxy of open blockchain networks in operation today.

Notably, the report touches on the possible factors that could shape the cryptocurrency market's future progression – including financial products based on the tech.

On this point, the bank's analysts suggest that a move by brokerages to begin offering such services to their clients could affect both the overall liquidity of the market as well as the market capitalization for the relevant cryptocurrencies.

 "The coin universe is dynamic and innovative and volatile; while a true value for cryptocurrencies may be impossible to assess, one factor which we believe could affect their liquidity and market capitalisation would be if one or more global broker/dealers decided to offer institutional-like products," they wrote.

The past year has seen a number of high-profile efforts to build cryptocurrency-tied investment products, and firms like CBOE have described plans to take part in what is still a nascent ecosystem. Even so, regulators in the U.S. have reacted coolly to such proposals thus far.

And according to the Bank of America analysts, it remains far from certain how the market will develop in the months to come.

"At present, these impacts are too far off, and too unpredictable, to form part of an estimate or an investment recommendation," they wrote.

Source : Coindesk

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World Bank President: Everyone Is Excited About Blockchain, Not Bitcoin

The president of the World Bank, Jim Yong Kim, was bullish about Blockchaintechnology when he spoke with CNBC during an interview. However, while expressing his positive views of the technology, he was quick to point out that there are risks when it comes to Blockchain technology derivatives like Bitcoin. When asked if the Blockchain based currencies were viable, he said:

"Blockchain technology is something that everyone is excited about, but we have to remember that Bitcoin is one of the very few instances [of Blockchain’s use in currency]. And the other times when Blockchain was used they were basically Ponzi schemes, so it’s very important that if we go forward with it, we're sure that it’s not going to be used to exploit.”

The World Bank functions as a lending house for national governments in order to provide needed capital. The institution has already been considering Blockchain technology solutions for some time, particularly in areas of financial transparency.

As the interview progressed, Kim’s views on Bitcoin became more clear, as he compared it with Chinese giant Alibaba, in terms of the speed and accuracy of transactions. He commented that with Alibaba, a transaction of $160,000 takes just ‘three seconds’ and that the company was able to assess the creditworthiness of the transaction in that amount of time. The implication being that Bitcoin is unnecessary when legacy models can do similar things.

Source: Cointelegraph

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State Bank of Mauritius Launches Lending Pilot With Blockchain Startup

A commercial bank in Mauritius has inked a deal with blockchain lending startup SALT to test the use of digital assets as collateral for loans.

The "exploratory" deal between the State Bank of Mauritius (SBM) and SALT, which offers a platform allowing users to borrow against their cryptocurrency holdings, will see the bank testing that specific application.

The development represents the latest step in a wider effort to make Mauritius – an island nation in the Indian Ocean with an estimated population of 1.2 million people – a hub for blockchain startups. That goal, advanced by local officials this past spring, was echoed in statements from the bank.

K.C. Li Kwong Wing, chairman of the SBM Group, said of the partnership:

"This relationship will go a long way toward achieving our nation's goal of becoming a hub for outstanding blockchain companies and fostering financial inclusion."

Notably, the chairman indicated that the bank was interested in potentially forming part of the startup's lending services, which could see SBM providing financing for the platform. That said, discussions on that particular point appear to be in the early stages.

"We are keen to explore providing banking services to this innovative company," he said.

As part of the Mauritian government's plans to develop the island as a blockchain center, representatives from ethereum startup ConsenSys visited the nation over the summer to meet with members of both the public and private sector. The ultimate aim of the exploratory talks was to create a so-called "Ethereum Island" to assist blockchain innovators seeking to branch out into Africa, Asia and elsewhere.

Source : CoinDesk

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Dimon Breaks Vow : "Bitcoin Buyers Will Pay the Price"

Jamie Dimon is back on the bitcoin commentary bandwagon.

Just a day after declaring on a third-quarter earnings call that he would refrain commenting on the cryptocurrency, the JPMorgan Chase CEO offered a critical take on those investing in bitcoin.

"If you're stupid enough to buy it, you'll pay the price for it one day," he said today at an event hosted by the Institute of International Finance, according to a report from CNBC. During the event, he reportedly voiced support for the cryptocurrency's underlying technology – an area in which the WallStreet bank has undertaken a number of notable efforts, including the Enterprise Ethereum Alliance.

Per CNBC, Dimon also reportedly said that he "could care less about what [price] bitcoin trades at."

A report from Bloomberg includes additional details about Dimon's latest comments. He reportedly said that bitcoin is "great" for criminals, and that – in a refrain from yesterday – that it would be the last time he would comment on the subject.

"Who cares about bitcoin?" he was quoted as saying.

The remarks are the latest from Dimon, whose now-infamous comment in September that bitcoin is a "fraud" sparked a wave of commentary about bitcoin itself as well as the wider cryptocurrency market. Other Wall Street figures, including Goldman Sachs CEO Lloyd Blankfein and ex-Fortress billionaire Mike Novogratz, have also weighed in on the topic.

His comments also come on the day that bitcoin's price rose above $5,800 to hit anew all-time high. At press time, the price of bitcoin is trading at about $5,689, according to the Bitcoin Price Index (BPI).

Source : CoinDesk

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Why Banks are so Nervous About Bitcoin

There was a time where Bitcoin was not even on the radar, it was a novel idea that was primarily used by thieves and drug dealers on the dark web. Nothing to be afraid of in terms of holding a monopoly on money.

However, that same little upstart is now disrupting the system of things; from Bitcoin and other cryptocurrencies, ICOs and the ever impressive Blockchain technology. This is now a legitimate threat on traditional banks.

"Bitcoin’s skyrocketing run in value, as well as adoption and mainstream acceptance, has led to banks - and regulators, getting very nervous and instigating a few knee jerk reactions. These reactions are, however, simply asserting the fact that Bitcoin is a legitimate disruptive threat."

• Bitcoin taking on the banks

Regulators are trying to play catch up with Bitcoin and other cryptocurrencies, realising now that it’s not going away. In fact, it is challenging their monetary system which is intrinsically linked to banks, and especially central, government-backed, banks.

China, especially, Russia, recently, Japan and the US have played their hands in varying degrees of harshness in efforts to try and control the decentralized monetary idea.

In fact, traditional centralised, powerful organisations like banks, governments, regulators and technology behemoths are all spending billions in figuring out how to use and control distributed trust technologies.

• A powershift

Banks have existed unchallenged for hundreds of years, and that is the key issue here; Bitcoin, backed by a solid platform such as Blockchain technology, is a ghost that is incredibly hard to control due to its decentralized nature.

"John McAfee has been brazen about regulators’ power plays to try and control Bitcoin, saying that they will never be able to ban it."

The power and control of money is being ripped away from traditional institutions, which can also be seen on Wall Street. Some of these traditional investors are siding with what could be the future, while others vehemently denounce it.

Individuals can now enter into direct peer-to-peer trusted exchanges with strangers. They no longer need a central institution to vouch for the other party.

Just like the fax machine, the library, even metered taxis, new technologies have come along and made others obsolete. Banks are now in the sights of Bitcoin and are in their death throws, as they lash out with the power of states behind them.

However, there’s no stopping progress, and even with state-backed regulations trying to wrestle the money of the people under control, banks have every reason to be nervous.

Source : Cointekegraph

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Coinbase Rolls Out Instant US Bitcoin Buys

Coinbasehas removed a major hurdle for US customers purchasing Bitcoin via bank transfer, cutting the waiting period from 3-5 days to “instantly.”

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Excited to announce instant digital currency purchases using a US bank accounthttps://blog.coinbase.com/announcing-instant-bitcoin-ethereum-and-litecoin-purchases-on-coinbase-c29d8a94e152 …

4:00 PM - Oct 12, 2017

Announcing instant bitcoin, ethereum and litecoin purchases on CoinbaseWe are excited to announce the ability for customers to instantly purchase digital currency using a US bank account. Previously, customers…blog.coinbase.com

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“Previously, customers who purchased using a bank account had to wait several days before receiving their digital currency,” the post clarifies.

“Customers can now buy up to $25,000[...] and receive access to their digital currency immediately.”

Under the previous setup, customers would agree an exchange rate and take the risk associated with fluctuating prices in the five-day period prior to receiving their coins. On social media, users frequently reported waiting up to double the time stated by Coinbase itself.

The stakes are now higher for Coinbase’s coffers, the company is also taking on exposure from coins cleared off its books prior to the equivalent fiat payment reaching its account.

Zach Abrams, head of product, was quoted by TechCrunch as saying:

“Coinbase uses proprietary fraud prevention systems it has developed over the last five years, to determine how this instant purchase feature is rolled out to groups of customers, and that the customers with access to this feature have sufficient balance in their bank account with good purchase history.”

Around 15,000 account holders will receive the instant buy function initially, with a wider rollout coming later.

Source : Cointekegraph

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India Central Bank ‘In Process’ of Making Bitcoin Regulation

India has refused to comment on its progress with cryptocurrency regulation, only appearing to confirm that official plans were “in progress.”

Reports by local news outlet Economic Times quote Reserve Bank of India Deputy Governor NS Vishwanathan as making comments to the press at an event in Calcutta today.

“I can’t comment on a policy that is still in the making,” he said.

Draft proposals of a recommendations on how to regulate cryptocurrency in India surfaced in August. These were the result of a government panel specifically tasked with researching the issue in April.

Cryptocurrency investment and trading have ballooned in the country ever since Prime Minister Narendra Modi’s highly contentious cash reforms began in November 2016.

Dash Core CEO Ryan Taylor said earlier this week:

“Measures of economic freedom are strongly correlated with economic success throughout the world. In India, a great deal of friction was introduced with the immediate banning of the vast majority of the country’s circulating currency. In contrast, digital currencies are freely transferred person-to-person anywhere in the world instantly. This can have a dramatic positive impact on an economy suffering from onerous financial restrictions like India.”

Indians have overwhelmingly used cash as the basic means of exchange, and aggressive government plans to make payments digital and link transactions to participants biometrically have received considerable criticism.

Taylor added:

“I doubt digital currency will overtake the rupee anytime soon, but dysfunction certainly creates the right environment to motivate consumers and businesses to seek an alternative like digital currency to address their needs.”

Source : Cointekegraph 

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Vladimir Putin: Cryptocurrency Poses 'Serious Risks'

Russian president Vladimir Putin said in a meeting today that cryptocurrencies pose significant risks related fraud and money laundering.

Quoted by Russian state news service TASS, Putin was speaking during a meeting that was focused on the subject of cryptocurrencies and financial tech more broadly. In the meeting, he formally voiced his support for new rules around cryptocurrency trading, stating that Russia should look to international examples as a guide when developing those regulations.

Indeed, the meeting represents some of Putin's most comprehensive comments on the subject to date. He first spoke about cryptocurrencies in the summer of 2015, remarking at the time that there were "serious, really fundamental issues related to its wider usage." In his new statements, Putin highlighted the rising profile of the technology, while also echoing those 2015 comments.

Putin was quoted as saying:

"Virtual [currencies] or cryptocurrencies are becoming and have already become more popular. They have already become or are turning into a full-fledged payment instrument and an investment asset in certain countries. At the same time, use of cryptocurrencies also carries serious risks."

On the subject of the rules themselves, Putin threw his support behind regulations that would protect consumers and facilitate the development of new financial products.

"We should develop such a regulatory system on the basis of international experience that will make possible to make relations in this sphere systemic, definitely protect interests of citizens, business and the government, and provide legal guarantees for work with innovative financial instruments," he said.

His comments come after a senior official for Russia's central bank stated publicly that his institution will support efforts to block access to external websites that offer cryptocurrency brokering services in the country. Representatives from the Bank of Russia were also present at the Putin meeting, according to sources.

Source : CoinDesk

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PBoC Digital Currency Director Calls for Centralized State Cryptocurrency

China may not recognize bitcoin as a legal currency, but it seems to have a clear vision for a state-issued alternative.

At a meeting hosted by the International Telecommunication Union this week, Yao Qian, the Director of the Digital Currency Research Institute under the People's Bank of China, reportedly boasted about the potential of a state-owned digital currency, while suggesting that there is an inherent lack of value anchoring public cryptocurrencies like bitcoin.

According to a report by Yicai, Yao also framed a state-issued digital currency as a way to stabilize domestic fiat currency, while better securing country's financial status.

Although the publication made clear Yao's comments reflected his own opinions, the remarks nonetheless reveal how the country may choose to direct the future development of digital currency.

Yao told attendees:

"The value of cryptocurrencies such as bitcoin primarily comes from the market speculation. It will be a disaster to recoganize it as a real currency. And the lack of a value anchroing inherently determines that bitcoin can never be a real one."

Launched by China's central bank in June this year, the Digital Currency Research Institute focuses on R&D related to blockchain-based digital currency. Currently head of the institute, Yao also served as the deputy director of PBoC's technology department.

Pointed barbs

Elsewhere, Qian had more criticism for public cryptocurrencies.

In yet another statement, he was quoted as saying that the deflationary nature of economic systems utilizing the technology could be a hinderance to their success. "A total cap of 21 million like bitcoin whose current supply also halves every four years is actually driving backward along the currency evolution," he said.

Yao went on to argue that a state-owned digital currency, however, creates tangible economic values and helps stabilize the market position of fiat currencies.

"The nature of a state-owned digital currency is a government liability issued to the public," he said. "And it's backed by the sovereign credibility."

Yet, Yao takes a different approach from current trials of other central banks' cryptocurrency projects that focus on the distributed ledger technology.

Citing the RSCoin design concept by the Bank of England as a promising example, Yao argued that such state-owned digital currency should not be confined by the ideology of the blockchain and DLT.

"RSCoin pictures a system that is controlled by the central bank," he said. "The role of central banks may not just be deciding how much to supply but also designing the rule of the supplying algorithm."

Source : CoinDesk

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Real Blockchain Estate Initiative Launches By Dubai Land Department

Dubai's land registrar has revealed it is developing a system that would seek to record all local real estate contracts on a blockchain.

The project, part of a sweeping plan to secure all government documents on a blockchain by 2020, was announced this week by Dubai Land Department, the government agency tasked with overseeing land purchases and approving real estate trades.

In statements, the agency framed blockchain technology as a way to gain the confidence of global real estate investors, and as a convenience for tenants, whose leases would be recorded by the system.

Sultan Butti bin Mejren, the land department's director general, said in a statement:

"Our aim is to unite all real estate and department services on a single platform. We hope to complete our project in the year 2019–2020."

In a press release issued Saturday, the agency said, "The technology will allow investors residing in Dubai and around the world to verify property data that is backed by timestamp signatures, enhancing the accuracy of data, the credibility of investment transactions and the transparency and clarity of the market."

On the leasing side, the department said, the platform will connect renters not only to landlords, but also to other property-related billers, such as electrical, water and telecommunications utilities.

The latter will allow tenants "to make payments electronically without the need to write cheques or print any paper … within a few minutes at any time and from anywhere in the world."

Partnering with the Dubai Land Department on the initiative are Asset Management Group, one of the largest real estate developers in Dubai; Emirates NBD, one of the region's largest banks; the furniture chain IKEA; and the Emirates Identity Authority.

Dubai has also explored the technology for airport security, trade finance and immigration controls, working with IBM and rolling out the red carpet for startups in a notable effort to become a blockchain innovation hub.


Source: Coindesk

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A Real Competition Between Companies to Disrupt Apps Market Using Blockchain

Accusations of “bubble” abound even as Bitcoin price surges back toward its record high of $5,000. There are also suggestions that Bitcoin’s price should be viewed in terms of the S-curve of rapid adoption.

Others say that Bitcoin will reach $50,000, or even $1 mln, in due course. Hardcore skeptics such as Chase CEO Jamie Dimon believe that the government will ultimately shut down Bitcoin and bring this grand experiment to an end.

User “dashfriend” on the Dash Nation Slack comments:

“Isn’t ease of use one of the main catalysts for a bubble? I don’t see ease of buying yet for non-tech people.”

User “foxtrot” agreed:

“In order for a bubble to exist there needs to be saturation of the market...and with the crypto market still [in] its infancy, that seems highly unlikely...Hasn’t Bitcoin supposedly been in a bubble since it was $2?”

A powerful disconnect

Many digital currency investors and traders are focusing on the presence of institutional investors: banks, pension funds, mutual funds and the like. While such mega investors would certainly help push the price up, it seems that retail investors and users are always forgotten in such discussions.

With so many working on creating ETFs, regulated futures markets and so on, who is focusing on the little guy? Who is working to make sure that digital currency gets in the hands of as many ordinary people as possible?

It’s the apps

According to TechCrunch, the apps market is expected to reach $6.3 tln by 2021. By the end of this year, there will have been a total of 268 bln apps downloaded, with revenue exceeding $77 bln.

This is a staggeringly huge market, and with Google and Apple taking over a 30 percent cut of the profits, it’s a market ripe for disruption.

While many startups are trying to find ways to profit from this enormous market, to date they have been hampered by the Blockchains they build upon. Both Bitcoin and Ethereum are capable of about seven transactions per second, which is clearly not enough capacity to support a transformation of the apps market.

Competition is stiff

Among companies that aim at using Blockchain to disrupt the app market are Mobius, ChainLink and IOTA.

Cyrus Khajvandi, co-founder of Mobius, is anticipating the creation of “Smart Markets” where data from connected devices can be traded freely between other devices. According to Khajvandi, Mobius gives the example of connected appliances which contract with decentralized electricity generators to provide machine-to-machine payments. Such a system would use “smart contracts” and “smart auctions” to run appliances, using as little energy as possible at the lowest possible prices.

Mobius boasts Jed McCaleb as an early investor and advisor. McCaleb is the founder of Ripple and Stellar, and, somewhat unfortunately, the founder of doomed Bitcoin exchange Mt. Gox.

Mobius intends to be a leader in the Internet of Things (IOT), but to do so, they will face stiff competition.

IOTA has a significant head start in this area, seeking to “[make] every technological resource a potential service to be traded on an open market.”

Even in terms of their current product for app payments, Mobius has competitors such as ChainLink. In fact, ChainLink’s services sound similar to Mobius’ product. ChainLink’s website says:

“ChainLink is Blockchain middleware that allows smart contracts to access key off-chain resources like data feeds, various web APIs, and traditional bank account payments.”

Nothing is certain

BlockTower Capital cofounder Matthew Goetz probably said it best when he compared the digital currency and Blockchain boom to the Internet boom of the late-1990s. Goetz warns:

“You could be right on the thesis that cryptocurrencies are transformative, and you could make what you think is the right bet at the time, but remember one time you had Yahoo and then this thing called Google came along.”

Mobius, IOTA, ChainLink and others all sound interesting, but the market will ultimately decide on the winners and losers. Even if you can predict the general trend, it’s much more difficult to bet on exactly the right horse.


Source: Cointelegraph

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Wall Street May Fall in Love With Blockchain Following The Recent Ethereum Upgrade

Wall Street continues to have a tenuous relationship with Blockchain technology. Large banks have recently made statements both for and against the new technology, with some companies like Bank of America already pursuing patents.

• Problem with privacy:

Part of the struggle these financial platforms are having with Blockchain technology is the issue of privacy. The key issue for traders is to keep their positions a secret in order to keep other traders and competitors out of the loop. While Blockchain technology provides immutability, it does not provide complete security or anonymity - keys for enterprise level financial adoption.

However, the ZK-Snark, or Zero Knowledge proofs recently being enabled on the Ethereumblockchain following the network’s Byzantium upgrade, represent a new way to have both anonymity and immutability on a single chain. According to Bloomberg:

“Its ability to reshape vital financial market functions like clearing and settlement has always hinged on whether banks can keep customer and proprietary data secret. Zero-knowledge proofs, a theoretical possibility for decades, are now a reality, letting transactions be verified without the need to share any of the underlying data.”

Source: Cointelegraph

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7 International Banks Join Forces To Develop Syndicated Loan Market Based On Blockchain

Seven major global banks have partnered with financial technology (fintech) firms R3 and Finastra for the development of the Blockchain technology-based marketplace for syndicated loans, called Fusion LenderComm. Among the banks are BNP Paribas, BNY Mellon, State Street, and ING.

According to Finastra head of product management, corporate and syndicated lending, Ian Morris, they already successfully concluded the first set of pilot runs on the prototype system in August 2017, and plan to conduct more in the coming months.

“More pilots are planned in the coming month. Development sprints continue towards the final objective of go-live next year.”

• To improve data sharing between banks :

The Fusion LenderComm platform is designed to improve the data sharing activities between agents and lenders, with the ultimate goal of bolstering efficiency and transparency in the syndicated loan market. The system will show real-time credit agreements, position information, accrual balances, and detailed transaction data directly to lenders from agent bank loan servicing platforms like Finastra’s Fusion Banking Loan IQ.

The unalterable system will maintain all transaction history to provide each lender a personal view of deals participated in, and a time-stamped audit record. Among the benefits of the system are reduced operational cost and burden of agent-to-lender administration, and access to accurate information to lenders on demand, to maximize loan portfolios.

The platform will be underpinned by R3’s Blockchain-inspired Corda system and is scheduled to be commercially launched in 2018.

Finastra deputy chief executive officer (CEO), Simon Paris, said that the project has already attracted around 10 percent of the global syndicated lending market, with other players expected to join in the near future.

 “As more participants join, we will quickly gain the critical mass to develop this into the leading marketplace for syndicated lending and loan trading. No more will lenders find themselves an underserved part of the syndicated loan value chain. Where they have struggled with a lack of transparency and speed in accessing critical deal positions, Fusion LenderComm opens up new data plains beyond position reconciliation.”

Source: Cointelegraph

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