Top Crypto News – 05/10/2017

Former Bundesbank Chief: Bitcoin Doesn’t Meet Full Definition of a Currency

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The chairman of Swiss banking giant UBS doesn’t believe that bitcoin meets the full definition of a currency, according to new statements.

Axel Weber, who previously served as head of the Bundesbank, Germany’s central bank, made the remarks during an event in Zürich earlier today, according to Reuters.

After noting that his skepticism toward the cryptocurrency “probably comes from my background as a central banker,” Weber argued that in spite of arguments to the contrary, bitcoin only partially satisfies the common definition of a currency.

He told event attendees:

“The important function of a currency is, it’s a means of payment, it has to be generally accepted, it has to be a store of value and it’s a transaction currency. Bitcoin is only a transaction currency.”

Weber reportedly criticized the cryptocurrency market back in late 2015, according to a report at the time from City A.M. He is said to have remarked that the bitcoin model is set to fail “because there is no lender of last resort – there will always be boom and bust.”

The UBS chairman becomes the latest figure from a major financial institution to weigh in on the topic of cryptocurrencies. Just yesterday, Lloyd Blankfein, the CEO of Wall Street investment bank Goldman Sachs, took to Twitter to offer an open (if not neutral) perspective on bitcoin.

Image Credit: International Monetary Fund/Flickr

Written by CoinBase

Bitcoin may soon be a ‘rational, expected’ part of a portfolio, Bitstamp’s Dan Morehead says

 

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Dan Morehead, chairman of digital currency exchange Bitstamp, said bitcoin and other digital currencies will likely become assets serious investors will want in their portfolios.

“Bitcoin’s essentially going to revolutionize currency, or money,” Morehead said on Wednesday at the Sohn Investment Conference in San Francisco, which was attended by portfolio managers and asset allocators.

“If it does work, the upside is so high, it’s a rational, expected thing to have in your portfolio,” he said.

Bitcoin is “going to disrupt money just like voice-over IP” took away the dominance of giant telecommunications companies on communication, he said. VOIP, or voice over internet protocol, is the technology that allows real-time voice calls over the internet.

The blockchain technology behind bitcoin has led to the development of many other digital currencies, such as ethereum and litecoin.

Morehead said he considered those blockchain-based tokens to be protocols, a system of rules similar to HTTP and others that enable the internet to exist as it does today.

Right now, those protocols may run the internet, but most of the profits are going instead to the applications, such as Google’s Gmail, which are built on top of those protocols.

In contrast, Morehead said that in a blockchain-based world, the protocols such as bitcoin take 95 percent of the earnings, while the “application,” such as the digital currency exchanges, take a smaller share of the profits.

“Only a tiny bit is in the companies,” he said, pointing out that cryptocurrency exchange Coinbase only has a valuation of about $1.5 billion, compared with bitcoin’s more than $70 billion market capitalization.

That has a “very interesting implication for investing,” Morehead said.

About 13 percent of bitcoin-U.S. dollar trading volume took place on Bitstamp Wednesday, according to digital currency data website CryptoCompare.

Morehead also founded Pantera Capital, a blockchain investment firm and one of the largest institutional owners of bitcoin, according to its website.

Wednesday’s event is the West Coast version of a New York-style investment conference, which are best known for hedge fund managers making market-moving presentations.

The Sohn conferences benefit pediatric cancer and other causes for underserved youth. The conference was presented in partnership with CNBC.

 

Written by CNBC

 

Ripple’s CEO On Cryptocurrencies And The Future Of XRP

 

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These questions originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.

Answers by Brad Garlinghouse, CEO of Ripple:

Q: What will set XRP apart from other cryptocurrencies?

A: What sets XRP apart from the other major digital assets is that XRP is highly performant and optimized for institutional use in global payments. While I’m personally loving BTC and a believer that it’s solving a different use case, the reality is that today the average time to complete a BTC transaction is about four hours. In contrast, XRP is about four seconds. A couple of other similar comparisons important for payments and enabling an Internet of Value:

  • The XRP ledger can handle more than 1500 transactions/second. BTC is currently ~15 transactions/second.
  • XRP fees per transaction are measured as fractions of a penny. BTC fees per transaction are measured in dollars.

Q: What are some things about Blockchain that are just hype?

A: Blockchain is like the new big data or AI – too many people are using it as a buzzword and not focused solving a real problem. We like to call them Blockchain tourists! There are many applications that are nothing more than science experiments.

Some of the uses being implemented for blockchain could actually work better with a database. There are examples out there that blockchain is not most applicable for and that is why Ripple is focused on a real world use case, solving a real (and very large) customer problem, which has converted into commercial traction that is unmatched in the enterprise blockchain space.

Q: How close are we to XRP being adopted by the banks?

A: Some of our customers are already in the early stages of using xRapid, Ripple’s XRP liquidity solution. Payments into emerging markets can require multiple currency traders (added costs) and pre-funded local currency accounts in the destination (trapped, dormant capital). Instead, payment providers and banks can use XRP to fund these payments on demand, without intermediaries, at a cost that is less than half of the current cost.

But it’s safe to say that we have to crawl before we walk before we run. This is uncharted territory for banks and payment providers and it’s going to take time before you see broad adoption of digital assets solving this multi-trillion dollar opportunity. Suffice it to say, we are very pleased by the interest from various pilots our customers are already running.

Written by Forbes

 

Hijacking Computers to Mine Cryptocurrency Is All the Rage

 

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Have you visited Showtime’s website recently? If so, you may be a cryptocurrency miner. An observant Twitter user was the first to sound an alarm last month that the source code for the Showtime Anytime website contained a tool that was secretly hijacking visitors’ computers to mine Monero, a Bitcoin–like digital currency focused on anonymity.

It’s still not clear how the tool got there, and Showtime quickly removed it after it was pointed out. But if it was the work of hackers, the episode is actually part of a larger trend: security experts have seen a spike in cyberattacks this year that are aimed at stealing computer power for mining operations. Mining is a computationally intensive process that computers comprising a cryptocurrency network complete to verify the transaction record, called the blockchain, and receive digital coins in return (see “What Bitcoin Is, and Why It Matters”).

Lately the same mining tool that appeared on Showtime’s website has been showing up all over the Internet. Released just last month by a company called Coinhive, the tool is supposed to give website owners a way to make money without displaying ads. But malware authors seem to be among its most voracious early adopters. In the past few weeks, researchers have discovered the software hiding in Chrome extensions, hacked WordPress sites, and even in the arsenal of a notorious “malvertising” hacker group.

Coinhive’s miner isn’t the only one out there, and hackers are using a variety of approaches to hijack computers. Kaspersky Lab recently reported finding cryptocurrency mining tools on 1.65 million of its clients’ computers so far this year—well above last year’s pace.

The researchers also recently detected several large botnets set up to profit from cryptocurrency mining, making a “conservative” estimate that such operations could generate up to $30,000 a month. Beyond that, they’ve seen “growing numbers” of attempts to install mining tools on servers owned by organizations. According to IBM’s X-Force security team, cryptocurrency mining attacks aimed at enterprise networks jumped sixfold between January and August.

The researchers say that hackers are especially attracted to relatively new alternatives to Bitcoin, particularly Monero and zCash. That’s probably in part because these currencies have cryptographic features that make transactions untraceable by law enforcement (see “Criminals Thought Bitcoin Was the Perfect Hiding Place, but They Thought Wrong”). It’s also because hackers can generate more profits mining these newer currencies than they can with Bitcoin. Bitcoin-mining malware was extremely popular two or three years ago, but the currency’s popularity has, by design, made it more difficult to mine, warding off this kind of attack. Hackers are now embracing newer, easier-to-mine currencies

Malware containing cryptocurrency mining tools can be relatively straightforward to detect using antivirus software, says Justin Fier, cyber intelligence lead for the security firm Darktrace. But illegal mining operations set up by insiders, which can be much more difficult to detect, are also on the rise, he says—often carried out by employees with high-level network privileges and the technical skills needed to turn their company’s computing infrastructure into a currency mint.

In one instance, Fier’s team, which relies on machine learning to detect anomalous activity inside networks, noticed an employee at a major telecom company using a company computer in an unauthorized way to communicate with his home machine. Further investigation revealed that he had planned to turn his company’s server room into a mining pool.

So long as there is a potential payday involved, such inside jobs are likely to remain high on the list of cybersecurity challenges that companies face. As for keeping hacked websites from hijacking your personal computer? In an ironic twist, some ad blockers are now banning Coinhive.

Written by MIT.

 

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Ghostface Killah to Launch Cryptocurrency Company

 

Ghostface Killah has cofounded a cryptocurrency company called Cream Capital, CNBC reports. The company is looking to raise $30 million during its initial coin offering (ICO).

Cream Capital takes its name from Wu-Tang Clan’s 1993 classic song “C.R.E.A.M.,” which stands for “Cash rules everything around me.” In the case of the company, Cream Capital Chief Executive Brett Westwood told CNBC it has been granted the trademark for Crypto Rules Everything Around Me.

The ICO “Cream Dividend” tokens will be sold in November, which can then be exchanged for Ether. Ether is the value token of the Ethereum blockchain. Essentially, blockchains are the digital ledger for economic transactions that serve as the backbone for the digital currency. Cryptocurrency, such as bitcoin, is digital currency that uses cryptography for security.

“Ghostface Killah is a longtime business partner of ours,” Westbrook told Pigeons & Planes of the rapper’s involvement in the venture. Westbrook said that they met during a Reddit AMA and added that Ghostface Killah will serve as the company’s Chief Branding Officer.

“Ghostface Killah is a longtime business partner of ours,” Westbrook told Pigeons & Planes of the rapper’s involvement in the venture. Westbrook said that they met during a Reddit AMA and added that Ghostface Killah will serve as the company’s Chief Branding Officer.

“His work capacity will be laying out a framework for which cryptocurrencies are more familiar to everyday people,” Westbrook explained of the rapper’s role in the company.

A rep for Ghostface Killah did not immediately respond to a request for comment.

ICOs are a way of crowdfunding, but they’ve recently come under scrutiny. As TechCrunch points out, the Securities and Exchange Commission charged two companies – REcoin and DRC World – for allegedly defrauding investors by selling unregistered securities and coins that don’t exist. These appear to be the first ICOs to come under scrutiny for fraud.

Cream Capital told CNBC that its ICO participants would be protected via a digital coin standard to prevent investors from monetary losses. The company said that their virtual coins can also be added to debit cards that can be used at stores and places that take card payments.

The company is holding its token sale on November 11th.

Written by the Rolling Stone

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