Bře 22

UK’s New Taskforce Means Cryptocurrency is Here to Stay

· March 22, 2018 · 12:30 pm

The United Kingdom is ready to release the hounds on the cryptocurrency market, with a task force set to investigate both the benefits and the risks of digital currencies.

Taking Cryptocurrency to Task

Britain’s department of finance, the Treasury, unveiled its task force readied to weigh the pros and cons of cryptocurrencies.

The United Kingdom’s interest in investigating cryptocurrency stems from the desire to not fall behind their geopolitical and economic rivals. UK Finance Minister Philip Hammond stated:

I am committed to helping the sector grow and flourish, and our ambitious sector strategy sets out how we will ensure the U.K. remains at the cutting edge of the digital revolution.

However, the no-longer-interested-in-being-European country hasn’t been particularly pro-cryptocurrency, and that’s not likely to change. Rather, it’s likely more interested in co-opting blockchain technology for its own traditional financial institutions. Said Hammond:

As part of that, a new task force will help the U.K. to manage the risks around crypto assets, as well as harnessing the potential benefits of the underlying technology.

The task force includes the Bank of England and the Financial Conduct Authority — neither of which has shown support to Bitcoin and cryptocurrencies in the past. Earlier this month, Bank of England Governor Mark Carney — who has a long history of anti-cryptocurrency rhetoric — stated:

The short answer is: [cryptocurrencies are] failing. Cryptocurrencies are poor stores of value. Over the past 5 years, the daily standard deviation of Bitcoin was 10x that of sterling […] This extreme volatility reflects that the cryptocurrencies have neither intrinsic value nor external backing.

Whether the task force’s conclusions match Carney’s sentiment remains to be seen.

Building Bridges

Australia coat of amrs

Britain’s new cryptocurrency task force is but one part of the sovereign state’s financial technology strategy, which also includes penning a deal with Australia. The two countries’ “fintech bridge” will afford British firms the ability to sell their products and services in Australia, while both countries work together on crafting policies and regulation on digital currencies, blockchain technology, and fintech.

After signing the deal, Britain’s Innovate Finance and Australia’s Fintech Australia will advise the governments of both countries in matters relating to financial technology. Innovate Finance’s Charlotte Croswell claimed the “fintech bridge” is an “excellent opportunity” for both countries.

What do you think of the UK’s new cryptocurrency task force? Do you expect more FUD, or perhaps a little bit of FOMO? Let us know in the comments below!

Images courtesy of Wikipedia Commons, Pixabay, Shutterstock

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Bře 21

Altcoin Bear Market ‘Over’, Bitcoin ‘Less Miserable,’ Tom Lee Declares

· March 21, 2018 · 1:30 pm

Fundstrat Global Advisors’ Tom Lee has declared the altcoin bear market “is over” and urged investors to buy Bitcoin.

Tom Lee: Investors ‘More Comfortable’ With Bitcoin

In a note to investors which he followed up live on CNBC’s Fast Money segment, the firm’s head of research said investors were becoming “more comfortable” with Bitcoin as an asset.

Cryptocurrencies began rallying this week after the ongoing G20 Summit produced positive regulatory noises from the outset.

Tom Lee

“I think the headlines were less draconian than many people were worried about, but that’s really been the case every time there’s been a regulatory event,” Lee told CNBC.

The reality is I think Bitcoin is starting sit away from the line[…] I think investors are comfortable that Bitcoin is likely to viewed as a commodity; whether regulations change around security tokens and registration, Bitcoin sits in its own sphere.

Bitcoin Misery Index Perks Up At $9k

Altcoins had felt the pressure from Bitcoin’s downward trend, showing a delayed response after BTC/USD began falling late December but with many assets subsequently falling more steeply.

According to observations from Lee and his team, this trend bottomed out around March 20, and could now point to new upside, subject to a similar delay to the initial descent.

“The altcoins don’t really rally until mid-August, mid-September,” he forecast, adding that ‘altcoin’ for Fundstrat meant cryptocurrencies outside the top 50 by market cap.

In terms of buying Bitcoin, however, Lee hinted now was the time. Using his Bitcoin Misery Index, which Bitcoinist previously reported on earlier this month, he told viewers that Bitcoin’s score was still within the ‘buy zone’ below 27 out of 100.

At the time Lee issued the index, that score was just 18. “It’s still in the zone of misery, but of course it’s less miserable,” he added.

Lightning Network Is Happening! First Physical Item Purchased on LN

Technical upgrades such as a Lightning Network production beta last week have contributed to broader positive sentiment on Bitcoin meanwhile, with Weiss upgrading its rating for the cryptocurrency from C+ to B-.

BTC/USD was holding support around $9000 on major exchanges as of press time March 21.

What do you think about Tom Lee’s altcoin forecast? Let us know in the comments below!

Images courtesy of Shutterstock, CNBC.com

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Bře 20

4 Ways Criminals Are Trying to Cash out Their Bitcoin

· March 20, 2018 · 2:30 pm

Due to the increased spotlight on cryptocurrency, criminals are finding it more difficult to cash out their Bitcoin for fiat, but they are finding ways to do so.

A common media portrayal is that of a criminal who plies their trade on the Dark Web and amassing a fortune in Bitcoin. It is true that the daddy of cryptocurrency can be used for all manner of illicit transactions, but an interesting phenomenon is now occurring. While some criminals have amassed a veritable fortune in bitcoins, they are finding it increasingly difficult to cash out the cryptocurrency to fiat. However, they are finding some ingenious ways to do so.


A Hard Knock Life

A recent report by Vice highlights this issue that criminals are having. People who conduct illicit business on the Dark Web, such as selling stolen information or malware, are making some serious money, but they are facing obstacles in converting that digital wealth into actual fiat currency.

The main reason for this problem is that cryptocurrency is the victim of its own success. The massive surge in value towards the end of 2017 shone a very bright spotlight upon the cryptocurrency sphere, catching the attention of law enforcement and regulatory bodies.

The increasing acceptance of cryptocurrency has led to more regulations being put into place, such as exchanges requiring verifiable information from its users. Law enforcement has also become more adept at infiltrating the seedy underbelly of the crypto sphere, not to mention keeping a sharp eye on large-scale transactions.

Some Savvy Criminals

This increased scrutiny has led criminals to try to cash out their Bitcoin. Swiss bankers have reported being contacted and offered a 10% payment if they could facilitate large-scale transfers; offers that they have, so far, rejected.


However, criminals can be an ingenious lot at times. A few methods for cashing out their bitcoins were revealed to Vice. One such method is using Western Union. An online drug dealer says he uses services that will automatically transfer cryptocurrency to accounts belonging to Western Union. Then he uses another person to pick up the fiat.

Probably the safest way to cash out is to sell the Bitcoin to a trusted person in the real world. A malware seller tells Vice that he regularly sells cryptocurrency to a local person a few times per week, who then leaves a bag of cash on their porch a few hours after the crypto is transferred. Another method is to work with a company that charges pre-paid debit cards with cryptocurrency. Criminals note that the card issuer does not know what is being used to charge the card as another company handles that. If the card requires some documents, fake ones can be procured on the Dark Web.

Law enforcement notes that another viable option for criminals is to use a bank in Eastern Europe. Regulations dealing with cryptocurrency are much more lax in that particular region. In fact, Europe is currently known as a weak link when it comes to money-laundering and cryptocurrency. Even now, such enforcement is not high on the EU list of priorities, which is something that cybercriminals are very aware of. In addition, criminals are now moving away from Bitcoin and into other cryptocurrencies that are far more private.

Do you think criminals will always find a way to cash out their cryptocurrencies? Let us know in the comments below.

Images courtesy of Pexels, Pixabay, and Bitcoinist archives.

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Bře 17

Despite Recent Volatility, Majority of Financial Experts Remain Bullish on Cryptocurrency

· March 17, 2018 · 2:00 pm

Despite recent market volatility and declining valuations, more than half of investors exposed to cryptocurrency plan on purchasing more over the next year.

Undeterred Optimism

Research conducted by international communications agency Citigate Dewe Rogerson has revealed that 56 percent of cryptocurrency investors are planning on purchasing more digital assets over the next 12 months.

Meanwhile, 31 percent of cryptocurrency investors are planning on holding all or selling some of their digital assets, while 8 percent plan on dumping it all.

Bitcoin volatility

Recent weeks have seen the prices of cryptocurrencies plummet. At press time, Bitcoin (BTC) is trading at $8,346.50, which is well off its all-time high of over $20K. Likewise, Ethereum (ETH) is trading at $608.65, Ripple (XRP) at $0.68, Litecoin (LTC) at $164.10, and Cardano (ADA) at $0.17 — all significantly lower than their peaks a few months ago.

Nevertheless, financial professionals reported optimism to Citigate. 54 percent noted that they expect the valuations of cryptocurrencies to rise over the next 12 months, citing increased regulation and adoption as positive drivers in price. On the other hand, 32 percent expect a drop. The same percentage of respondents also expect a “dramatic” increase in cryptocurrency valuation from now until 2021.

Citigate Dewe Rogerson executive director Phil Anderson told City A.M.:

At the start of the year, the market capitalisation for cryptocurrencies was around $800bn (£577bn), but by 2021 over half of the financial professionals (59 per cent) we interviewed expect it to be over $1 trillion, while 15 per cent anticipate it to be more than $2 trillion.

Tenfold Return in Bitcoin Over Three Years

This positive sentiment mirrors that of others in the financial industry — like Bitwise Asset Management Vice President of Research and Development Matt Hougan, who stated last month his belief that cryptocurrency is a multi-trillion dollar opportunity. Hougan explained:

The road between now and trillions of dollars will be extremely rocky … we could get there in a few months. We could get there in a few years. We could go down 50% before we get there … [but] I think the pathway to a trillion dollars eventually is fairly certain. How we get there is going to be volatile and uncomfortable. I think we’ll get there pretty soon, though. I wouldn’t be surprised if we ended the year with an accumulated market cap over a trillion dollars.

Are you planning on increasing your cryptocurrency portfolio, or are you looking to simply hold on to what you’ve got? Do you have plans to sell it all? Let us know in the comments below!

Images courtesy of AdobeStock, Bitcoinist archives, and Pixabay.

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Bře 13

European Central Bank: Bitcoin ‘Not The Answer To Cashless Society’

· March 13, 2018 · 1:30 pm

The European Central Bank (ECB) claimed Bitcoin is “not the answer to a cashless society” March 13 while also casting doubt on bank-issued digital currencies.

Bitcoin ‘Spotlights System Failures’

In an “opinion piece” co-authored by Benoît Cœuré, ECB board member and chair of the Bank for International Settlements’ (BIS) Committee on Payments and Market Infrastructures, as well as chair of the BIS Markets Committee Jacqueline Loh, the bank argues Bitcoin represents a “challenge” due to banks’ failure to provide suitable international remittance options for consumers.

“Despite its many faults, bitcoin has put the spotlight on an old failing of our current system: cross-border retail payments,” they write.

…These payment channels are generally much slower, less transparent and way more expensive than domestic ones. Improvements here are the best way of rising to the bitcoin challenge.

ECB: ‘Jury’s Out’ On Central Bank Cryptocurrencies

The ECB has signalled a conspicuously hands-off approach to digital currency beyond its control in 2018.

Last month, chair of its Supervisory Board Daniele Nouy told mainstream media regulation of the phenomenon was “not exactly very high on its to-do list” and that EU banks’ involvement with cryptocurrency was “very, very low.”

This came despite the institution presiding over member states in which the ‘War on Cash’ is highly advanced, notably Sweden, where consumers have even voiced concerns over inclusivity.

Cœuré had forecast increasing interaction at an international level, saying during January’s World Economic Forum 2018 that he expected lawmakers to “focus very much on” cryptocurrency going forward.

While Blockchain remains a sphere of major interest for the EU, the financial aspects of cryptocurrency – whether decentralized or so-called central bank digital currencies (CBDC) – appear to hold less promise for the ECB.

“Still, it is not yet clear whether CBDCs for consumers and businesses are necessary or desirable. In other words, the jury is still out, and the answer will clearly differ country by country,” Cœuré and Loh concluded.

Beyond the EU’s borders, other countries are indeed successfully issuing CBDCs, notably Venezuela and the Marshall Islands, with Turkey and Iran showing interest in following suit.

What do you think about the ECB’s opinion on Bitcoin? Let us know in the comments below!

Images courtesy of Shutterstock

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Bře 12

Controversial Monaco Debit Card Progresses After 2 Years Of Delays

· March 12, 2018 · 1:30 pm

Controversial Bitcoin debit card issuer Monaco has finally begun closed beta testing after almost two years of development.

MCO Token Spikes After Months Of Tracking Bitcoin

Originally founded in June 2016, Monaco promises cryptocurrency spending at “perfect interbank exchange rates” but faced controversy after failed deals and drastic reworking of its product offering late last year.

Now, the company’s MCO token has regained some of the ground it lost since the time of Bitcoin’s own all-time highs in December, reaching $9.10 on Coinmarketcap. It had previously reached almost $19, before dropping to lows of $4.75 February 6 – also in line with Bitcoin.

Commenting on its sponsorship of the ongoing Money 20/20 event in Singapore, Monaco CEO Kris Marszalek described the unveiling of new products in light of the beta announcement as “revolutionary.”

“Together, they form a complete suite of revolutionary financial products and position Monaco as the first global financial institution built on blockchain, as well as, a destination platform for anyone interested in cryptocurrency,” he said.

A promotional video about the features will be seen by “100 million plus people in 2018,” Marszalek added on Twitter.

Dodgy Visa Partnerships And Price Crashes

Monaco’s path to release has been troublesome. In October 2017, Bloomberg ran a piece in which it debunked the company’s repeated claims it had a partnership with Visa.

While Visa finally approved Monaco’s offering to Singaporean residents in November, Monaco had said the partnership had been in place since May.

At the same time, a sudden change to the card’s roadmap saw a key feature in the form of smart asset contracts disappear, causing MCO to crash 40%.

The events led to a round of suspicion among cryptocurrency users, with accusations appearing online the product contained elements of a scam.

The cryptocurrency debit card industry as a whole remains a challenging environment this year. On and off-ramps into Bitcoin via exchanges are becoming increasingly cost-effective thanks to SegWit implementation, while cardholders continue to pay heavy premiums for the convenience of spending coins under the guise of legacy payment instruments.

What do you think about Monaco? Let us know in the comments below!

Images courtesy of Shuttesrtock, Monaco

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Bře 11

Older South Koreans Are Investing in Cryptocurrencies the Most

· March 11, 2018 · 1:00 pm

While most people associate cryptocurrency investment with the younger half of the generational spectrum, reports have shown that seniors in South Korea are going significantly harder in the digital paint than younger investors.

Respect your elders

According to a survey of 2,530 adults by the Korea Financial Investors Protection Foundation conducted last December, older investors are getting involved in cryptocurrency much more aggressively than younger investors — though the latter is more active when it comes to buying and selling.

People in their 60s invested larger amounts than any other age demographic, totaling 6.59 million Korean Won — or $6,194 USD. “The older the investor, the larger the investment,” Kwon Soon-chae, told Korea Joongang Daily.

However, senior analyst at the Korea Financial Investors Protection Foundation is worried that older investors don’t really understand what they’re getting themselves into. Said Soon-chae:

There’s a need for older investors to not lose their retirement savings on cryptocurrency investments.

South Korea Bans Bitcoin Futures As Authorities Consider Crypto Income Tax

The survey also revealed that roughly 23 percent of South Koreans in their 20s have experience in buying cryptocurrency, while people in their 30s aren’t far behind at 19 percent. The likelihood of a South Korean in his or her 40s investing in cryptocurrency, meanwhile, was 12 percent, while someone in their 50s was only 8 percent.

In regards to investment size, South Koreans in their 20s averaged 2.93 million Korean Won, versus people in their 30s and 40s who both invested less than 4 million won. Those in their 50s weren’t far behind those in their 60s, at 6.29 million won.

As noted by Korea Joongang Daily, 42 percent of participants in their 60s were investing more than 3 million won, while 21 percent invested more than 10 million won. Of those in their 50s, less than 10 percent invested a larger sum than 10 million won, as compared to participants in their 20s and 30s, of which 40 percent put less than 1 million won.

The hype is over

Perhaps most importantly, the survey indicates that the hype surrounding cryptocurrency — particularly during the unprecedented bull run which took place late last year — has cooled off.

According to the survey, respondents that continued to invest in cryptocurrency made up only 6.4 percent of the total pool, while 31.3 percent never even dipped their toes in digital currency’s waters.

A particularly concerning statistic for cryptocurrency enthusiasts is the fact that one 7 percent claimed they would continue to invest in digital currencies, while 23.1 percent admitted feelings of reluctance. Meanwhile, 70 percent claimed they had no plans to invest in cryptocurrency.

Respondents’ largest concern was the threat of hacks, while volatility came in as the second most popular reason for refraining from cryptocurrency investments.

Are you at all surprised to learn that older Koreans are more aggressive cryptocurrency investors? Do you think the downtrend to start 2018 is scaring investors away? Let us know in the comments below.

Images courtesy of Bitcoinist archives, Shutterstock

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Bře 10

Bitcoin Cash Propaganda Poll Backfires

· March 10, 2018 · 12:00 pm

The Twitter account @Bitcoin — an intentionally misleading account which only supports Bitcoin Cash (BCH) — recently tried to defame Bitcoin (BTC) in a poll on the popular social media website. Unfortunately for them, it didn’t work.


For those who aren’t aware, the Twitter account @Bitcoin actually has nothing to do with Bitcoin (BTC). Rather, the account uses Bitcoin’s name while pumping out anti-Bitcoin propaganda and shilling the dominant cryptocurrency’s largely-unwanted step-brother, Bitcoin Cash (BCH). As noted by Badbitcoin.org:

The Bitcoin account on Twitter @Bitcoin has been hijacked or bought by those scoundrels promoting the Bcash (Bitcoin Cash) Scam. Mail Order Explosives, Bitcoin, Scams – They do the lot! 1/8/18.

The borderline-scam account posted a poll on Thursday, asking which ‘Bitcoin’ Twitter users prefer. Of course, in doing so, the Twitter handle explicitly made biased and incorrect statements in an attempt to prove that Bitcoin Cash is the superior cryptocurrency. It backfired:

When all was said and done, Bitcoin (BTC) proved to be the overwhelming favorite, despite the Bcash scammers best efforts to undermine the dominant cryptocurrency. Out of 17,437 votes — a sizeable sample — 74% of users preferred the real Bitcoin (BTC) to Bitcoin Cash (BCH).

Additionally, the @Bitcoin Twitter handle was recently restricted on the popular social media site, though the reasons behind both the account’s restriction and restoration of permissions aren’t clear.


Bitcoin Cash — a hard fork of Bitcoin — largely markets itself as being ‘Satoshi Nakamoto’s real vision’ for Bitcoin and, in doing so, claims to be ‘the true Bitcoin.’ Meanwhile, misleading accounts like @Bitcoin on Twitter spew intentionally misleading information in desperate attempts to gain support.

As evidenced by the Bcash shill account’s own Twitter poll, however, many cryptocurrency investors view Bitcoin Cash as little more than an attempted hijacking of the Bitcoin brand by Roger Ver, Calvin Ayre, and others, to capitalize on the confusion of new investors.

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Bitcoin Cash, however, is making headway in one particular field. Recently, reports surfaced that, for the first time, Bcash is being accepted as a form of ransom payment by ransomware — intrusive software, which encrypts victims files and demands payment in return.

In other news, Ayre himself is launching his own Bcash-only vacation resort in Antigua, where he has primarily resided since being indicted by the US Attorney for Maryland on charges of illegal gambling and money laundering.

[Full disclosure: the author is a holder of Bitcoin (BTC)]

Which do you prefer: Bitcoin (BTC) or Bitcoin Cash (BCH)? Let us know in the comments below!

Images courtesy of Twitter/@Bitcoin, Bitcoinist archives

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Úno 28

So Why Did Goldman Sachs-Backed Circle Really Buy Poloniex?

· February 28, 2018 · 10:00 am

Goldman Sachs-backed startup Circle made waves earlier this week when it acquired cryptocurrency exchange Poloniex. A couple of experts share their thoughts on the implications for the soon-to-be first compliant US crypto exchange and its customers.

Most Crypto Exchanges ‘Over-Regulate Themselves’

As the dust settles on Circle’s acquisition of Poloniex, U.S. regulators are keeping a close eye on KYC/AML compliance of cryptocurrency exchanges.

Joseph Weinberg

Joseph Weinberg, OECD Think Tank Special Advisor and Chairman of Shyft, a blockchain protocol that will create a new standard for the KYC/AML mandates, shared his comments with Bitcoinist. He states:

Most crypto exchanges that are processing fiat to crypto transactions are very compliant and, in some cases, even more so than banks. It all really depends on jurisdictions and the compliance policies given by countries to crypto exchanges.

He continued:

For crypto exchanges, the challenge lies in how little formal guidelines there are from regulators. As a result, most of the industry has been doing self-compliance in absence of clear procedures. To err on the safe side, crypto exchanges over-regulate themselves. For example, most exchanges ask for passport verification in order to confirm users’ identities, whereas most banks only require government-issued IDs, such as drivers licenses.

Interestingly, Circle acquired the crypto exchange over a year after announcing it was shifting focus from Bitcoin to blockchain-based services. At the time, the company informed its Bitcoin customers that they can can cash out or transfer their balances to Coinbase, if they wished to continue to use the cryptocurrency.

So why did Circle decide to jump back into the crypto game?

It appears that Poloniex was struggling to keep up with the unexpected surge in new users as prices skyrocketed in the second half of 2017. Additionally, being based in the United States, the company also had to keep up with rising compliance costs as it rolled out its new KYC policies late last year.

Weinberg explains:

In the past, Poloniex had a lot of issues with onboarding new users and properly building out its KYC process, mainly due to the large amounts of time it takes to verify users. Given the level of KYC that exchanges force themselves to go through, scaling compliance is almost a separate product that the exchange has to build out.

According to him, this is where Circle comes in with their KYC/AML expertise. He says:

Through this acquisition, Circle will deploy more people to help handle compliance—more employees to build and process KYC due diligence faster. This is the same type of issue traditional banks have when it comes to scaling. Compliance costs keep multiplying, and yet, they aren’t always found to be effective.

The SEC Is Watching

Meanwhile, another takeaway has been put forth by Nathaniel Popper, author of Digital Gold: Bitcoin and the Inside Story of the Misfits and Millionaires Trying to Reinvent Money.

Popper noted on Twitter that the SEC informally suggested to Circle that no enforcement action will occur if the Boston-based startup “cleans up Poloniex and turns it into a regulated exchange.” He adds:

The SEC seems to be saying here that it’s okay if you broke the rules, as long as you get acquired by a legitimate player before we crack down on you.

The question now seems to be whether the SEC will apply this same thinking to other virtual currency exchanges if they are acquired by large players.

In addition to facilitating compliance, Circle also announced that it will add fiat bridges and expand operation to other markets. Namely, the company promised to explore “USD, EUR, and GBP connectivity that Circle already brings to its compliant Pay, Trade, and Invest products.”

This would imply that the exchange must also become compliant and answer to regulators from across the pond, who are currently scratching their heads on how to approach cryptocurrencies without stifling innovation in the process.

Therefore, regulators in the U.S. and abroad could be playing the carrot and stick strategy by providing an incentive for crypto exchanges to get acquired by the large players, such as Goldman Sachs, before a potential crackdown. Admittedly, this could also be a clever way for traditional finance to not only appear innovative through association but also assimilate would-be future competitors.

If true, the strategy may be futile and usher in the Streisand effect to boot. As technology advances, so do new methods of exchanging cryptocurrency. Therefore, assimilating centralized exchanges like Poloniex could force users to migrate en masse to decentralized exchanges and further bolster their development.

Why do you believe Circle acquired Poloniex? Share your comments below!

Images courtesy of Shutterstock, Twitter/@nathanielpopper.

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Úno 27

Crashes And Failed Payments: Peter Todd Urges Caution Over Lightning Network

· February 27, 2018 · 11:30 am

Bitcoin Core developer Peter Todd has delivered a frank appraisal of the Lightning Network, suggesting it is technically insufficient in its current form.

Lightning’s Growing Pains

Writing about his “initial impressions” of Lightning’s testnet implementation on Twitter Monday, Todd questioned aspects including operational resilience and programming language.

“Initial impressions of Lightning on testnet: c-lightning segfaults a lot, and when it’s not crashing payments fail more often than not. Writing it in C – a notoriously dangerous language – doesn’t strike me as a good idea,” he wrote.

Since its mainnet debut at the start of the year, the Lightning Network has grown rapidly, but cryptocurrency experts and developers remain divided over whether the technology is ready for use at all.

Future Vulnerability Today

The most hotly awaited of the so-called ‘Layer 2’ Bitcoin network improvements, Lightning promises near-zero transaction fees and confirmation times.

This month, Microsoft threw its weight behind the project, pledging support for it as an off-chain Bitcoin scaling solution while pouring cold water over on-chain solutions such as block size increases.

On a technical level, however, the experimental state of Lightning remains evident. Figures including Bitcoin.org creator Cobra preceded Todd in voicing doubts about a consumer rollout given the untested nature of many of its features. The result, both say, could be lost funds.

“As for the Lightning protocol, I’m willing to predict it’ll prove to be vulnerable to DoS attacks in it’s (sic) current incarnation, both at the P2P and blockchain level,” Todd meanwhile predicted.

“While bad politics, focusing on centralized hub-and-spoke payment channels first would have been much simpler.”

Lightning has also faced caution from Andreas Antonopoulos, who despite championing its technological promise saw regulatory woes forcing major cryptocurrency exchanges to avoid offering it.

This week meanwhile also saw Bitcoin Core release version 0.16.0, a major milestone incorporating full support for SegWit scaling improvements, itself a useful foundation for allowing Layer 2 solutions to spread.

What do you think about Peter Todd’s angle on the Lightning Network? Let us know in the comments below!

Images courtesy of Shutterstock, Twitter

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