They're using some variant of sharding to achieve scaling. That immediately throws into question how secure the system is, since the concept of "fully validating node" is basically upended.

It would take decades, if ever, for such technology to be proven secure. And then it'll need to contend with Bitcoin's first mover advantage.

It probably helps that the firm is backed by a billionaire (Michael Novogratz) whose optimism about the cryptocurrency market apparently knows no end.


This seems like an odd choice unless we're talking about very short term loans. Crypto-assets can be liquidated on a variety of exchanges and OTC markets when prices bring collateral near loan value. How easy is that to do with depreciating mining hardware?

Only temporarily, for about three weeks. If a permanent budget agreement isn't reached by then, the shutdown will continue.

This article is dumb, though -- unsurprising given that it's from Coinidol. If things like Bakkt or an ETF are held back, it's not a threat to the industry at all. Market demand for bitcoins has never been dependent on government rubber stamping or regulated markets. And on the bright side, a bare-bones SEC, CFTC, etc. means no enforcement actions coming down the pipeline either.

This comes back to the age-old question: What are "high fees?" Shouldn't we expect fees to rise over time, since they must replace the block subsidy? That was the original design, as I understand it.

Let's imagine a future decades from now, where speculation and block subsidy have much less influence on price. In the long run, shouldn't there be a strong relationship between transaction fees and the actual cost to mine transactions?

Right now, miners are effectively subsidizing that cost through speculation. They're willing to mine transactions for pennies on the dollar because they're in an arms race to mine the block subsidy. Many halvings out, that incentive will disappear. If we want similar or better security, we'll need to pay for it as users -- as fees.

It's like the alert system in early Bitcoin versions -- good intent, but introduces new opportunities for social engineering. Users need be cognizant of the fact that we're using Beta software and that critical bugs will happen. They need to stay informed.

I can't help but echo ETFbitcoin's sentiment that this would create a false sense of security for regular users.

He's not accounting for the transitional phase as we shift from inflation to fee market. It's possible that in these early years, speculation largely fuels mining security -- investors and miners are speculating on future transaction growth. He's not really allowing for the possibility that this transaction growth actually comes to fruition.

As long as scarcity of block space exists, transaction demand -- if sufficient to fill blocks -- should create a fee market. As fees rise, miner revenue increases. As fees fall, miner revenue decreases. Hopefully in the latter case, it would happen slowly enough that difficulty can adjust downward in an orderly fashion to allow continued mining profitability.

I'm guessing it's this. Roger Ver was an angel investor in Blockchain.info back in 2011. He probably owns a large stake in the company -- they didn't do any more fundraising until three years later. Judging by his actions with Bitcoin.com, I'm sure he'd use any influence he has to push Blockchain away from Segwit.

Private Internet Access's "no logging" claims were tested a couple years ago. The FBI tried to compel PIA to reveal location data about a suspected hoaxer. This is all they got:


That's why I use them. With most VPNs, you're just trusting their word. PIA also has a stellar reputation and a good UI as well.

Screw you up, how? Where do you live that this is actually an issue?

Money laundering pertains to illegally obtained money; tax evasion pertains to nonpayment of taxes. Not having trading history from Livecoin = neither. What exactly are you worried about?

Not only do you have deposit and withdrawal transactions on a public blockchain that match your holdings, but your government would never obtain that trading data from Livecoin anyway, so your whole question seems moot. Most people would just make up trading history that matches their deposit and withdrawal. Nobody would ever know the difference and there is no proof in the world that could refute your tax return.


Give some examples of how "you are risking big fines" if you pay the correct taxes due. In what countries are they "really strict with this" and do you actually live in one of those countries? You only need to worry about where you live.

In the US, you merely need to make a good faith effort.

I'm guessing most traders don't normally log in through the forums, or even visit them at all. That's probably why. Plus, it seems like LocalBitcoins shut the forums down within a couple hours.

I had read the compromise was via DNS spoofing the subdomain, but LocalBitcoins says it was "related to a feature powered by a third party software." Probably injection of malicious code into the forum software or something like that.

Are there any more details about this third party software and what the vulnerability was exactly?

I read a couple articles about the attack and I was led to believe this was a DNS spoofing attack on the forum subdomain. It sounds like that's not actually the case?


Glad to hear it. If the losses were really limited to 8 BTC, they should just compensate the victims out of goodwill.

What a misleading headline. They make it sound like people can just get up and buy bitcoins through existing ATMs, right now. That's not the case at all.

LibertyX got a BitLicense to potentially offer a debit-card-to-bitcoin service, that's all. It doesn't mean that traditional ATMs can sell you bitcoins yet, and there's no indication of how many Genmega machines will ever be Bitcoin-enabled. Genmega caters to the independent ATM deployers market -- enabling the bitcoin-buying feature at ATMs would be dependent on whether independent operators want to offer it.

A more accurate headline: "New Yorkers may be able to buy bitcoins at some Genmega ATMs at some point in the future, not clear how many"

It seems farfetched to me that large CME accounts would expose themselves to so much counterparty risk at various dodgy spot exchanges just to short the CME more effectively. That's something bitcoiners do on wild west exchanges (including Bitmex), but probably not serious institutional traders. Last I checked, the regulated markets didn't have very high volume to justify that either.

I'm less talking about manipulation in general anyway, and more to the idea that "CME futures launching = Wall Street shorting Bitcoin to the ground." If anything, Bakkt -- especially if it ends up allowing leverage -- would be a much more effective vehicle for that. Between leverage and conventional Wall Street accounting practices, Bakkt could dilute supply and the spot market will follow, if it has high enough volume.

My heart jumped a bit when I saw the words "LocalBitcoins compromised".... I expected the worst.

This is like when attackers were DNS spoofing the MyEtherWallet domain. This is a really old hacking technique that has little to with LocalBitcoins' security and everything to do with the crappy, centralized DNS. They hijacked the domain registry for the LocalBitcoins forums and a handful of people fell for it by logging in before administrators could shut down the forums. I'm glad the losses were limited to only 8 BTC.

Do you mean regulated futures, because they were launched when the market topped? That seems unlikely since they're cash-settled. They can short all they want on the CME market but that doesn't equate to bitcoins being dumped on exchanges. Unlike an open-ended ETF or physically settled contracts, there's no mechanism for cash-settled markets to lead the spot market.

If the big blockers had their way, that might have been true. Scarcity of block space is the only thing that guarantees any revenue for miners once inflation winds down. As long as a robust fee market exists, I think we should be okay though.

I think Russia has flip-flopped more than any other government on cryptocurrency issues. In 2014, the Prosecutor General said Bitcoin was illegal because it was a "money substitute." In 2016, the Federal Tax Service declared bitcoins were "not illegal." The same year, a bill was proposed that would have sent Bitcoin users to jail if passed. Statements from the Finance Minister and his deputy have literally contradicted each other.

There's obviously a huge amount of internal dissent, which is why we've never seen an actual law passed.

The way I see it, they tried to corner the market much like the Hunt Brothers did with the silver market. It sounds great on paper: Use obsolete hardware to mine Bitcoin Cash, withhold mined coins from the market and buy at spot to drive up the price.

I just think it would have worked out much better for Bitmain if there wasn't a gigantic supply of coins perpetually waiting to be dumped on them -- coins everyone got for free when the fork launched.

If it's not worth mining, I suppose difficulty will probably drop, eh?


That's about what I'd expect. Downward difficulty adjustment should lag behind price drops. Miners won't necessarily shut down immediately if price dips below their costs. They can also hedge their mining operations by shorting. There's also always going to be miners with access to free/cheap electricity or more efficient mining hardware than average, and also those with load balancing agreements with power generators. This is even acknowledged by one of their analysts, so their initial conclusion -- and the headline -- are really dumb:

This last time around, I don't blame Bakkt. They got stonewalled because of the government shutdown. I don't think anyone could have known we were about to see the longest government shutdown in history with 95% of the CFTC not working. They obviously seem to think approval is somewhat of a formality, and maybe it is, considering they aren't the first physically settled derivatives market anyway. Either way, until the CFTC opens the public comment period, we should assume nothing is moving forward.