Bitcoin - Open source P2P money

I put all my savings into ETH at $16 in 2017

From rags to riches and back to rags.
I became aware of Bitcoin in 2012, but didn't invest until 2014 @ $440. A few years prior, it had hit $1k, dropped, and much of the public lost interest except for users of Silk Road. I sold all my BTC once it hit $1k for the second time.
The more I read about ETH, the more I was convinced that this shit was wild. I didn't get it at first, but given my background (product engineering) I started to recognize use cases that Ethereum could take on: Debt vehicles owned by communities (rather than..JP Morgan). Music platforms owned by users. Ethereum is/was a software engineer's economic API. Prior to Ethereum, we could write apps that fit into real-world government/economies, but now, we could write entire governments and economies -- and we all know the economy is mankind's most influential behavioral system.
Once that clicked, I put all my money into Ethereum. I told my friends and family to invest a bit too. I bought some in February of 2017 and continued to buy until my ether chest became my savings. Once ETH breached $100, I was extremely confident that the world was seeing Ethereum for what I saw (an economic/government-building toolset) -- wow was I wrong.
ETH grew and grew, as we all know, topping out around ~$1400. I vividly remember waking up one morning, checking how much $ my investment was worth -- almost a half million. "I'll sell some once my stake reaches $500k," I said to myself idiotically. The prior night, I had gotten into a debate with a friend (who also invested) who had doubts about how long the asset would increase. I argued that the utility of Ethereum had barely hit the market, he argued that had nothing to do with the rise -- he was right. The rise of price was fueled by people telling friends/family 'I JUST MADE THIS MUCH MONEY YOU HAVE TO INVEST!!!', and had absolutely nothing to do with Ethereum's true value to society.
My friend sold all of his investment around this time. I did not. I watched my investment dwindle from some ~$450k to just a few thousand. During this time, I was funding my business, so I would sell my ETH slowly as the price dropped. My stack of crypto is almost nothing today, but one thing I took away was the value of money.
When my stack had reached nearly half a million, I felt the same as I do today. I felt the same as I did before I earned the money. Nothing in my life changed -- my happiness was exactly the same, except for the fact that I didn't have any stress around money. What made me happy was using my money for good causes - I donated a decent amount to ocean relief funds and used my money to build a business which made people happy via convenience.
I'm sharing this because I don't know how many other people have made half a million dollars in under a year (after being broke), then lost it all, but I'm sure it's not common. This experience taught me the value of money and its limits to happiness contributions. That said -- when you're under the poverty line, the personal value of money is way higher. It's like a maslow's hierarchy of needs situation -- once you've satisfied your basic financial needs, your increase in happiness is fueled by further endeavors outside of 'earning money'.
submitted by MycologistMan to ethtrader [link] [comments]

Flatten the Curve. #18. The current cold war between China and America explained. And how China was behind the 2008 Wall Street financial Crash. World War 3 is coming.

China, the USA, and the Afghanistan war are linked. And in order to get here, we will start there.
9-11 happened. Most of the planet mistakenly understood terrorists had struck a blow against Freedom and Capitalism and Democracy. It was time to invade Afghanistan. Yet all of the terrorists were linked to Saudi Arabia and not Afghanistan, that didn't make sense either. Yet they invaded to find Bin Laden, an ex CIA asset against the Soviet Union and it's subjugation of Afghanistan. The land in the middle of nowhere in relation to North America and the West. It was barren. A backwater without any strategic importance or natural resources.
Or was there?
The survey for rare earth elements was only made possible by the 2001 U.S. invasion, with work beginning in 2004. Mirzad says the Russians had already done significant surveying work during their military occupation of the country in the 1980s. Mirzad also toes the line for U.S. corporations, arguing, “The Afghan government should not touch the mining business. We have to give enough information to potential investors.”
Rare Earth Elements. The elements that make the information age possible. People could understand the First Gulf War and the Geopolitical importance of oil. That was easy, but it still didn't sound morally just to have a war for oil. It was too imperialist and so they fell in line and supported a war for Kuwaiti freedom instead, despite the obvious and public manipulation at the UN by Nayirah.
This is some of her testimony to the Human Rights Council.
While I was there, I saw the Iraqi soldiers come into the hospital with guns. They took the babies out of the incubators, took the incubators and left the children to die on the cold floor. It was horrifying. I could not help but think of my nephew who was born premature and might have died that day as well. After I left the hospital, some of my friends and I distributed flyers condemning the Iraqi invasion until we were warned we might be killed if the Iraqis saw us.
The Iraqis have destroyed everything in Kuwait. They stripped the supermarkets of food, the pharmacies of medicine, the factories of medical supplies, ransacked their houses and tortured neighbors and friends.
There was only one problem. She was the daughter of Saud Al-Sabah, the Kuwaiti ambassador to the United States. Furthermore, it was revealed that her testimony was organized as part of the Citizens for a Free Kuwait public relations campaign, which was run by the American public relations firm Hill & Knowlton for the Kuwaiti government (fun fact, Hill & Knowlton also have extensive ties with Bill Gates).
So the public was aghast at her testimony and supported the war against the mainly Soviet backed, but also American supported and Soviet backed Saddam Hussein, in his war against Iran, after the Iranians refused to Ally with American interests after the Islamic Revolution.
But that was oil, this was Rare Earth Elements. There was a reason the war was called, Operation Enduring Freedom. This natural resource was far more important in the long run. You couldn't have a security surveillance apparatus without it. And what was supposed to be a war on terror was in actuality a territorial occupation for resources.
Sleeping Dragon China is next, and where there's smoke, there's fire.
Let's go point form for clarity.
• China entered the rare earth market in the mid-1980s, at a time when the US was the major producer. But China soon caught up and became the production leader for rare earths. Its heavily state-supported strategy was aimed at dominating the global rare earth industry.
• 1989 Beijing’s Tiananmen Square spring. The U.S. government suspends military sales to Beijing and freezes relations.
• 1997. Clinton secures the release of Wei and Tiananmen Square protester Wang Dan. Beijing deports both dissidents to the United States. (If you don't understand these two were CIA assets working in China, you need to accept that not everything will be published. America wouldn't care about two political activists, but why would care about two intelligence operatives).
• March 1996. Taiwan’s First Free Presidential Vote.
• May 1999. America "accidently" bombs the Belgrade Chinese Embassy.
• 2002 Price competitiveness was hard for the USA to achieve due to low to non-existent Chinese environmental standards; as a result, the US finally stopped its rare earth production.
• October 2000. U.S. President Bill Clinton signs the U.S.-China Relations Act. China's take over of the market share in rare earth elements starts to increase.
• October 2001. Afghanistan war Enduring Freedom started to secure rare earth elements (Haven't you ever wondered how they could mobilize and invade so quickly? The military was already prepared).
• 2005. China establishes a monopoly on global production by keeping mineral prices low and then panics markets by introducing export quotas to raise prices by limiting supply.
• Rare Earth Elements. Prices go into the stratosphere (for example, dysprosium prices do a bitcoin, rocketing from $118/kg to $2,262/kg between 2008 and 2011).
• In a September 2005. Deputy Secretary of State Robert B. Zoellick initiates a strategic dialogue with China. This was presented as dialog to acknowledge China's emergence as a Superpower (which China probably insisted on), but it was about rare earth elements market price.
• October 2006. China allows North Korea to conduct its first nuclear test, China serves as a mediator to bring Pyongyang back to the negotiating table with the USA.
• September 2006. American housing prices start to fall.
(At some point after this, secret negotiations must have become increasingly hostile).
• March 2007. China Increases Military Spending. U.S. Vice President Dick Cheney says China’s military buildup is “not consistent” with the country’s stated goal of a “peaceful rise.”
• Mid-2005 and mid-2006. China bought between $100b and $250 billion of US housing debt between mid-2005 and mid-2006. This debt was bought using the same financial instruments that caused the financial collapse.
• 2006. Housing prices started to fall for the first time in decades.
• Mid-2006 and mid-2007. China likely added another $390b to its reserves. "At the same time, if China stopped buying -- especially now, when the private market is clogged up -- US financial markets would really seize up." Council on Foreign Relations-2007 August
• February 27, 2007. Stock markets in China and the U.S. fell by the most since 2003. Investors leave the money market and flock to Government backed Treasury Bills.
I've never seen it like this before,'' said Jim Galluzzo, who began trading short-maturity Treasuries 20 years ago and now trades bills at RBS Greenwich Capital in Greenwich, Connecticut.Bills right now are trading like dot-coms.''
We had clients asking to be pulled out of money market funds and wanting to get into Treasuries,'' said Henley Smith, fixed-income manager in New York at Castleton Partners, which oversees about $150 million in bonds.People are buying T-bills because you know exactly what's in it.''
• February 13, 2008. The Economic Stimulus Act of 2008 was enacted, which included a tax rebate. The total cost of this bill was projected at $152 billion for 2008. A December 2009 study found that only about one-third of the tax rebate was spent, providing only a modest amount of stimulus.
• September 2008. China Becomes Largest U.S. Foreign Creditor at 600 billion dollars.
• 2010. China’s market power peaked in when it reached a market share of around 97% of all rare earth mineral production. Outside of China, there were almost no other producers left.
Outside of China, the US is the second largest consumer of rare earths in the world behind Japan.
About 60% of US rare earth imports are used as catalysts for petroleum refining, making it the country’s major consumer of rare earths.
The US military also depends on rare earths. Many of the most advanced US weapon systems, including smart bombs, unmanned drones, cruise missiles, laser targeting, radar systems and the Joint Strike Fighter programme rely on rare earths. Against this background, the US Department of Defense (DoD) stated that “reliable access to the necessary material is a bedrock requirement for DOD”
• 2010. A trade dispute arose when the Chinese government reduced its export quotas by 40% in 2010, sending the rare earths prices in the markets outside China soaring. The government argued that the quotas were necessary to protect the environment.
• August 2010. China Becomes World’s Second-Largest Economy.
• November 2011. U.S. Secretary of State Hillary Clinton outlines a U.S. “pivot” to Asia. Clinton’s call for “increased investment—diplomatic, economic, strategic, and otherwise—in the Asia-Pacific region” is seen as a move to counter China’s growing clout.
• December 2011. U.S. President Barack Obama announces the United States and eight other nations have reached an agreement on the Trans-Pacific Partnership later announces plans to deploy 2,500 marines in Australia, prompting criticism from Beijing.
• November 2012. China’s New Leadership. Xi Jinping replaces Hu Jintao as president, Communist Party general secretary, and chairman of the Central Military Commission. Xi delivers a series of speeches on the “rejuvenation” of China.
• June 2013. U.S. President Barack Obama hosts Chinese President Xi Jinping for a “shirt-sleeves summit”
• May 19, 2014. A U.S. court indicts five Chinese hackers, allegedly with ties to China’s People’s Liberation Army, on charges of stealing trade technology from U.S. companies.
• November 12, 2014. Joint Climate Announcement. Barack Obama and Chinese President Xi Jinping issue a joint statement on climate change, pledging to reduce carbon emissions. (which very conveniently allows the quotas to fall and save pride for Xi).
• 2015. China drops the export quotas because in 2014, the WTO ruled against China.
• May 30, 2015 U.S. Warns China Over South China Sea. (China is trying to expand it's buffer zone to build a defense for the coming war).
• January 2016. The government to abolish the one-child policy, now allowing all families to have two children.
• February 9, 2017. Trump Affirms One China Policy After Raising Doubts.
• April 6 – 7, 2017. Trump Hosts Xi at Mar-a-Lago. Beijing and Washington to expand trade of products and services like beef, poultry, and electronic payments, though the countries do not address more contentious trade issues including aluminum, car parts, and steel.
• November 2017. President Xi meets with President Trump in another high profile summit.
• March 22, 2018. Trump Tariffs Target China. The White House alleges Chinese theft of U.S. technology and intellectual property. Coming on the heels of tariffs on steel and aluminum imports, the measures target goods including clothing, shoes, and electronics and restrict some Chinese investment in the United States.
• July 6, 2018 U.S.-China Trade War Escalates.
• September 2018. Modifications led to the exclusion of rare earths from the final list of products and they consequently were not subject to import tariffs imposed by the US government in September 2018.
• October 4, 2018. Pence Speech Signals Hard-Line Approach. He condemns what he calls growing Chinese military aggression, especially in the South China Sea, criticizes increased censorship and religious persecution by the Chinese government, and accuses China of stealing American intellectual property and interfering in U.S. elections.
• December 1, 2018. Canada Arrests Huawei Executive.
• March 6, 2019. Huawei Sues the United States.
• March 27 2019. India and the US signed an agreement to "strengthen bilateral security and civil nuclear cooperation" including the construction of six American nuclear reactors in India
• May 10, 2019. Trade War Intensifies.
• August 5, 2019. U.S. Labels China a Currency Manipulator.
• November 27, 2019. Trump Signs Bill Supporting Hong Kong Protesters. Chinese officials condemn the move, impose sanctions on several U.S.-based organizations, and suspend U.S. warship visits to Hong Kong.
• January 15, 2020. ‘Phase One’ Trade Deal Signed. But the agreement maintains most tariffs and does not mention the Chinese government’s extensive subsidies. Days before the signing, the United States dropped its designation of China as a currency manipulator.
• January 31, 2020. Tensions Soar Amid Coronavirus Pandemic.
• March 18, 2020. China Expels American Journalists. The Chinese government announces it will expel at least thirteen journalists from three U.S. newspapers—the New York Times, Wall Street Journal, and Washington Post—whose press credentials are set to expire in 2020. Beijing also demands that those outlets, as well as TIME and Voice of America, share information with the government about their operations in China. The Chinese Foreign Ministry says the moves are in response to the U.S. government’s decision earlier in the year to limit the number of Chinese journalists from five state-run media outlets in the United States to 100, down from 160, and designate those outlets as foreign missions.
And here we are. You may have noticed the Rare Earth Elements and the inclusion of Environmental Standards. Yes these are key to understanding the Geopolitical reality and importance of these events. There's a reason the one child policy stopped. Troop additions.
I believe our current political reality started at Tiananmen square. The protests were an American sponsored attempt at regime change after the failure to convince them to leave totalitarian communism and join a greater political framework.
Do I have proof? Yes.
China, as far as I'm concerned, was responsible for the 2008 economic crisis. The Rare Earth Elements were an attempt to weaken the States and strengthen themselves simultaneously. This stranglehold either forced America to trade with China, or the trade was an American Trojan horse to eventually collapse their economy and cause a revolution after Tiananmen Square failed. Does my second proposal sound far fetched? Didn't the economy just shut down in response to the epidemic? Aren't both sides blaming the other? At this POINT, the epidemic seems to be overstated doesn’t it? Don't the casualties tend to the elder demographic and those already weakened by a primary disease?
Exactly the kinds who wouldn't fight in a war.
Does this change some of my views on the possibility of upcoming catastrophes and reasons for certain events? No. This is Chess, and there are obvious moves in chess, hidden moves in chess, but the best moves involve peices which can be utilized in different ways if the board calls for it.
Is all what it seems? No.
I definitely changed a few previously held beliefs prior to today, and I would caution you in advance that you will find some previously held convictions challenged.
After uncovering what I did today, I would also strongly suggest reading information cautiously. This is all merely a culmination of ending the cold war, and once I have events laid out, you will see it as well.
At this moment, the end analysis is a war will start in the near future. This will be mainly for a few reasons, preemptive resource control for water and crops, population reduction can be achieved since we have too many people, not enough jobs, and upcoming resource scarcity.
Did you notice my omission of rare earth elements? This is because of Afghanistan. I would wager China or Russia is somehow supporting the continued resistance through Iran. But events are now accelerating with China because the western collation has already begun to build up their mines and start production.
Do you remember when Trump made a "joke" about buying Greenland? Yeah. It turns out that Greenland has one of the largest rare earth mineral deposits on the planet.
Take care. Be safe. Stay aware and be prepared.
This message not brought to you by the Bill and Melinda Gates Foundation, Microsoft, Google, Facebook, Elon Musk, Blackrock, Vangaurd, the Rockefeller Foundation, Rand Corporation, DARPA, Rothschilds, Agenda 21, Agenda 30, and ID 2020.
submitted by biggreekgeek to conspiracy [link] [comments]

I'm Mark Karpelès, ex-CEO of bankrupt MtGox. Ask me anything.

Dear community,
Many of you know or remember me, especially recently since the MtGox bankruptcy has been allegedly linked with Bitcoin price drops in December 2017 to February 2018. Since taking over the most active Bitcoin exchange in 2011, I ran MtGox until filing for civil rehabilitation on February 28th 2014 (which became bankruptcy less than 2 months later) because a large amount of Bitcoins went missing. Since then, four years have passed, and MtGox is still in bankruptcy today. I’ve been arrested, released under bail after a little less than one year, and am now trying to assist MtGox getting into civil rehabilitation.
I did my best trying to grow the ecosystem by running the biggest exchange at the time. It had big problems but still managed to hang in there. For a while. A quite long while, even, while the rest of the ecosystem caught up. At the end of the day, the methods I chose to try to get MtGox out of its trouble ended up being insufficient, insufficiently executed, or plain wrong.
I know I didn't handle the last, stressful days of the outdrawn and painful Gox collapse very well. I can only be humble about that in hindsight. Once again, I’m sorry.
Japanese bankruptcy law has a particularly nasty outcome here, and I want to address this up front. As creditors claims were registered, those claims were registered in the valuation of Japanese Yen on the bankruptcy date. That's the only way Japanese bankruptcy law can work (most bankruptcy laws around the world operate this way for that matter). This means that the claims can be paid back in full, and there will still be over 160,000 bitcoin and bitcoin cash in assets in the Gox estate. The way bankruptcy law works is that if there are any assets remaining after the creditors have been paid in full, then those assets are distributed to shareholders as part of the liquidation.
That's the only way any bankruptcy law can reasonably work. And yet, in this case, it produces an egregiously distasteful outcome in that the shareholders of MtGox would walk away with the value of over 160,000 bitcoin as a result of what happened.
I don't want this. I don't want this billion dollars. From day one I never expected to receive anything from this bankruptcy. The fact that today this is a possibility is an aberration and I believe it is my responsibility to make sure it doesn’t happen. One of the ways to do this would be civil rehabilitation, and as it seems most creditors agree with this, I am doing my best to help make it happen. I do not want to become instantly rich. I do not ask for forgiveness. I just want to see this end as soon as possible with everyone receiving their share of what they had on MtGox so everyone, myself included, can get some closure.
I’m an engineer at heart. I want to build things. I like seeing what I build being useful, and people being happy using what I build. My drive, from day one, has been to push the limits of what is technically possible, and this is the main reason I liked and have been involved with Bitcoin in the first place. When I took over MtGox, I never imagined things would end this way and I am forever sorry for everything that’s taken place and all the effect it had on everyone involved.
Hopefully, I can make what I’ve learned in this experience useful to the community as a whole, so there can at least be something positive in the end.
Ask me anything you like.
EDIT: With this coming to all there have been an overwhelming number of messages, questions etc. I will continue responding for a little while but probably won't be able to respond to new questions (it is starting to be late here and I've been spending the last few hours typing). Thank you very much to everyone.
submitted by MagicalTux to Bitcoin [link] [comments]

How the Bitcoin price was changing

Nowadays, the Bitcoin currency rate perhaps is the most unpredictable thing. All predictions about how BTC price will increase or drop are in some way similar to the weather forecasts. No one can tell what will happen to the coin tomorrow. One of the most important factors that experts rely on is the history of the currency rate over the whole period of BTC existence with its dynamics. It is essential to know what was happening to the coin as this allows you to understand what can happen to it in the future.

2009

The first digital currency – Bitcoin – came to the world on January 9, 2009. In the same month, the creator of Bitcoin mined the first block and he also made the first financial operation in the BTC system.

At the beginning of its history, the Bitcoin price was ridiculously low. The first exchange of BTC to US dollars was made in the summer of 2009 when Martti Malmi received 5.02 USD for his 5050 Bitcoins.

The first official Bitcoin exchange rate to the fiat dollar was established on October 9, 2009. At that time, for 1 dollar you could buy 1 309.03 BTC. Many people now regret that they missed the opportunity to buy Bitcoin for pennies.

2010

In 2010, events in the cryptocurrency market began to develop more intensively. The Bitcoin Market exchange was opened in February 2010, where it was possible to sell the digital coin. In May of this year, the most well-known deal with Bitcoin had happened. The programmer Laszlo Hanyecz bought 2 pizzas for 10,000 BTC. It was the first purchase using cryptocurrency in the real world. He posted a request on the crypto forum saying that he wanted to buy two pizzas. In exchange for that, he offered 10K Bitcoins that back then cost about 40 dollars. And there was a person who agreed to have this deal – it was the 19 years old Jeremy Sturdivant. Jeremy didn’t become a millionaire since then as he spent his coins to travel across the USA.

As for Laszlo, he doesn’t regret about the lost millions. He was mining coins for his pleasure at that time and spent them to different non-significant things.

In July of 2010, BTC price raised to 0.08 dollars. Then in November, the price went up for 50 percent. In general, 2010 was an excellent period for strengthening the position of Bitcoin. The digital currency was almost able to reach the point of one dollar.

2011

BTC overcame the point of 1 dollar only in February of 2011. By early June, the price had grown to 10 dollars. This was a small victory for Bitcoin. Another maximum was set at the point of $31.91. In the middle of June 2011, there was a sharp drop in price: from 31.91 again to 10 dollars.

The year 2011 was full of negative events. One of them happened on June 13, when a user’s electronic wallet was first hacked and 25 thousand coins were stolen from there. In a few days, some geeks hacked MtFox exchange where they got data of sixty thousand users. These events negatively affected the Bitcoin rate. It became clear that in the future the price of digital currency will be determined taking into consideration any events that occur in the market.

2012

In 2012, the exchange rate was ranging from 8 to 12 dollars per 1 BTC. This period was also rich in significant events. One of them is that Bitcoin Central bank began its work. This bank received a license and was even recognised by European regulators.

2013

February 22, 2013, was the day when Bitcoin began to grow again. The price reached the mark of $30. Another increase occurred at the end of January – $31.9. The upward trend continued. March 22 rate was 74.9 dollars per BTC.

On the first day of April, the price went up to $100 and within another nine days, the BTC price grew to 266 dollars. But the growth did not last long. By October it was $109. The possible reason for that is the arrest of an anonymous trading platform Silk Road.

Since November 2013, the price of Bitcoin began to grow anew. By the end of the month, the price exceeded all expectations and raised up to $1,200 per coin. The reason for overcoming the $1,000 point was the BTC support by Zynga game creator. Experts also noted another event that could affect the growth: one of the higher education institutions in Cyprus started accepting the Bitcoin as payment for tuition.

But by the end of the first week of December, the price was 1,000 dollars. In the middle of December 2013, the BTC price dropped to 600 dollars because the China Central Bank prohibited the country’s financial institutions to maintain operations with cryptocurrency.

2014

During the year 2014, there happened rather a significant amount of events that had an impact on the Bitcoin volatility. In the first days of January, 1 BTC was equal to 770 dollars. In February it was 700 dollars. Summer 2014 slightly strengthened the reputation of the cryptocurrency.

Many experts think that it was 2014 when BTC strengthened its position in the market, in spite of the fact that Bitcoin price was low – by the end of the year it settled in at around 310 dollars. In 2014 investors began to consider Bitcoin as a potential investment as Bitcoin price predictions seemed quite attractive.

2015

At the beginning of 2015, the BTC price started rising: with 177 dollars in January to 281 dollars to March. The number of people who were trading Bitcoin increased – there were about 160,000 people was buying and selling BTC on exchanges by August 2015. In one period of 2015 the Bitcoin price grew up to 500 dollars, but to the end of 2015, it dropped to about 350 USD.

2016

In 2016, Japan declared Bitcoin as a currency and allowed to use it to pay for goods and services. South Africa was the next who did the same. In April 2016, BTC rate went up and reached $454 per coin. By the end of May, 1 BTC was already worth $600. The reason for the price increase might be the growth of the number of transactions in the Chinese market. The highest price in 2016 was in December – $950 for one Bitcoin.

2017

The year of 2017 was an incredible period in respect of BTC price. It started with $1,000 for 1 coin. Already in June, it was $2,600. By the beginning of September, the price jumped to $5,000 per 1 BTC. On December 17, the Bitcoin price achieved a record and was over 20,000 US dollars.

How did this happen? Here are some reasons that experts point due to the growth of Bitcoin price:


However, later in December, the price plummeted from 20 000 dollars to 12 000 dollars. Experts had different reasons including that one of the first cryptocurrency creators sold out all his digital savings and called such investments too risky.

2018

During the first 4 months of 2018, the price of BTC dropped below 7,000 USD. These negative dynamics were quite logical because the rise is always followed by the fall. For the first time since October 2017, the Bitcoin price fell below 6,000 dollars. On November 25, the price of Bitcoin fell even lower – $3,676 per 1 BTC. By mid-December, the bitcoin rate fell by almost 80% to its yearly rate, the price was $3,200.

Nowadays

What can we expect in 2019? What Bitcoin price predictions do crypto experts have? People hope that 2019 will bring new opportunities for Bitcoin and also other cryptocurrencies. Some investors and crypto enthusiasts predict that the BTC price will grow to 40 – 50,000 USD by the end of 2019. One of them, John McAfee, is assured that the price will rise to 1 million dollars by the end of 2020. He even had a bet that he posted in his Twitter saying that he would eat his “love muscle” if his BTC price prediction will not come true.

There may be a number of factors that can influence the BTC price in 2019. They are:

As it was said before, Bitcoin price predictions are almost like the weather forecast – you never know what price it will have tomorrow. If you think about investing in BTC or any other cryptocurrency you should follow its rate at present time but never forget to compare it to the past. But please, don’t bet to eat any of your body parts 🙂

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The Decade in Blockchain — 2010 to 2020 in Review

2010

February — The first ever cryptocurrency exchange, Bitcoin Market, is established. The first trade takes place a month later.
April — The first public bitcoin trade takes place: 1000BTC traded for $30 at an exchange rate of 0.03USD/1BTC
May — The first real-world bitcoin transaction is undertaken by Laszlo Hanyecz, who paid 10000BTC for two Papa John’s pizzas (Approximately $25 USD)
June — Bitcoin developer Gavin Andreson creates a faucet offering 5 free BTC to the public
July — First notable usage of the word “blockchain” appears on BitcoinTalk forum. Prior to this, it was referred to as ‘Proof-of-Work chain’
July — Bitcoin exchange named Magic The Gathering Online eXchange—also known as Mt. Gox—established
August —Bitcoin protocol bug leads to emergency hard fork
December — Satoshi Nakamoto ceases communication with the world

2011

January — One-quarter of the eventual total of 21M bitcoins have been generated
February — Bitcoin reaches parity for the first time with USD
April — Bitcoin reaches parity with EUR and GBP
June — WikiLeaks begins accepting Bitcoin donations
June — Mt. Gox hacked, resulting in suspension of trading and a precipitous price drop for Bitcoin
August — First Bitcoin Improvement Proposal: BIP Purpose and Guidelines
October — Litecoin released
December — Bitcoin featured as a major plot element in an episode of ‘The Good Wife’ as 9.45 million viewers watch.

2012

May — Bitcoin Magazine, founded by Mihai Alisie and Vitalik Buterin, publishes first issue
July — Government of Estonia begins incorporating blockchain into digital ID efforts
September — Bitcoin Foundation created
October — BitPay reports having over 1,000 merchants accepting bitcoin under its payment processing service
November — First Bitcoin halving to 25 BTC per block

2013

February — Reddit begins accepting bitcoins for Gold memberships
March — Cyprus government bailout levies bank accounts with over $100k. Flight to Bitcoin results in major price spike.
May —Total Bitcoin value surpasses 1 billion USD with 11M Bitcoin in circulation
May — The first cryptocurrency market rally and crash takes place. Prices rise from $13 to $220, and then drop to $70
June — First major cryptocurrency theft. 25,000 BTC is stolen from Bitcoin forum founder
July — Mastercoin becomes the first project to conduct an ICO
August — U.S. Federal Court issues opinion that Bitcoin is a currency or form of money
October — The FBI shuts down dark web marketplace Silk Road, confiscating approximately 26,000 bitcoins
November — Vitalik Buterin releases the Ethereum White Paper: “A Next-Generation Smart Contract and Decentralized Application Platform
December — The first commit to the Ethereum codebase takes place

2014

January — Vitalik Buterin announces Ethereum at the North American Bitcoin Conference in Miami
February — HMRC in the UK classifies Bitcoin as private money
March — Newsweek claims Dorian Nakamoto is Bitcoin creator. He is not
April — Gavin Wood releases the Ethereum Yellow Paper: “Ethereum: A Secure Decentralised Generalised Transaction Ledger
June — Ethereum Foundation established in Zug, Switzerland
June — US Marshals Service auctions off 30,000 Bitcoin confiscated from Silk Road. All are purchased by venture capitalist Tim Draper
July — Ethereum token launch raises 31,591 BTC ($18,439,086) over 42 days
September — TeraExchange launches first U.S. Commodity Futures Trading Commission approved Bitcoin over-the-counter swap
October — ConsenSys is founded by Joe Lubin
December — By year’s end, Paypal, Zynga, u/, Expedia, Newegg, Dell, Dish Network, and Microsoft are all accepting Bitcoin for payments

2015

January — Coinbase opens up the first U.S-based cryptocurrency exchange
February — Stripe initiates bitcoin payment integration for merchants
April — NASDAQ initiates blockchain trial
June — NYDFS releases final version of its BitLicense virtual currency regulations
July — Ethereum’s first live mainnet release—Frontier—launched.
August — Augur, the first token launch on the Ethereum network takes place
September — R3 consortium formed with nine financial institutions, increases to over 40 members within six months
October — Gemini exchange launches, founded by Tyler and Cameron Winklevoss
November — Announcement of first zero knowledge proof, ZK-Snarks
December — Linux Foundation establishes Hyperledger project

2016

January — Zcash announced
February — HyperLedger project announced by Linux Foundation with thirty founding members
March — Second Ethereum mainnet release, Homestead, is rolled out.
April — The DAO (decentralized autonomous organization) launches a 28-day crowdsale. After one month, it raises an Ether value of more than US$150M
May — Chinese Financial Blockchain Shenzhen Consortium launches with 31 members
June — The DAO is attacked with 3.6M of the 11.5M Ether in The DAO redirected to the attacker’s Ethereum account
July — The DAO attack results in a hard fork of the Ethereum Blockchain to recover funds. A minority group rejecting the hard fork continues to use the original blockchain renamed Ethereum Classic
July — Second Bitcoin halving to 12.5BTC per block mined
November — CME Launches Bitcoin Price Index

2017

January — Bitcoin price breaks US$1,000 for the first time in three years
February — Enterprise Ethereum Alliance formed with 30 founding members, over 150 members six months later
March — Multiple applications for Bitcoin ETFs rejected by the SEC
April — Bitcoin is officially recognized as currency by Japan
June — EOS begins its year-long ICO, eventually raising $4 billion
July — Parity hack exposes weaknesses in multisig wallets
August — Bitcoin Cash forks from the Bitcoin Network
October — Ethereum releases Byzantium soft fork network upgrade, part one of Metropolis
September — China bans ICOs
October — Bitcoin price surpasses $5,000 USD for the first time
November — Bitcoin price surpasses $10,000 USD for the first time
December — Ethereum Dapp Cryptokitties goes viral, pushing the Ethereum network to its limits

2018


January — Ethereum price peaks near $1400 USD
March — Google bans all ads pertaining to cryptocurrency
March — Twitter bans all ads pertaining to cryptocurrency
April — 2018 outpaces 2017 with $6.3 billion raised in token launches in the first four months of the year
April — EU government commits $300 million to developing blockchain projects
June — The U.S. Securities and Exchange Commission states that Ether is not a security.
July — Over 100,000 ERC20 tokens created
August — New York Stock Exchange owner announces Bakkt, a federally regulated digital asset exchange
October — Bitcoin’s 10th birthday
November — VC investment in blockchain tech surpasses $1 billion
December — 90% of banks in the US and Europe report exploration of blockchain tech

2019

January — Coinstar machines begin selling cryptocurrency at grocery stores across the US
February — Ethereum’s Constantinople hard fork is released, part two of Metropolis
April — Bitcoin surpasses 400 million total transactions
June — Facebook announces Libra
July — United States senate holds hearings titled ‘Examining Regulatory Frameworks for Digital Currencies and Blockchain”
August — Ethereum developer dominance reaches 4x that of any other blockchain
October — Over 80 million distinct Ethereum addresses have been created
September — Santander bank settles both sides of a $20 million bond on Ethereum
November — Over 3000 Dapps created. Of them, 2700 are built on Ethereum
submitted by blockstasy to CryptoTechnology [link] [comments]

I'm Mark Karpelès, ex-CEO of bankrupt MtGox. Ask me anything.

Dear community,
Many of you know or remember me, especially recently since the MtGox bankruptcy has been allegedly linked with Bitcoin price drops in December 2017 to February 2018. Since taking over the most active Bitcoin exchange in 2011, I ran MtGox until filing for civil rehabilitation on February 28th 2014 (which became bankruptcy less than 2 months later) because a large amount of Bitcoins went missing. Since then, four years have passed, and MtGox is still in bankruptcy today. I’ve been arrested, released under bail after a little less than one year, and am now trying to assist MtGox getting into civil rehabilitation.
I did my best trying to grow the ecosystem by running the biggest exchange at the time. It had big problems but still managed to hang in there. For a while. A quite long while, even, while the rest of the ecosystem caught up. At the end of the day, the methods I chose to try to get MtGox out of its trouble ended up being insufficient, insufficiently executed, or plain wrong.
I know I didn't handle the last, stressful days of the outdrawn and painful Gox collapse very well. I can only be humble about that in hindsight. Once again, I’m sorry.
Japanese bankruptcy law has a particularly nasty outcome here, and I want to address this up front. As creditors claims were registered, those claims were registered in the valuation of Japanese Yen on the bankruptcy date. That's the only way Japanese bankruptcy law can work (most bankruptcy laws around the world operate this way for that matter). This means that the claims can be paid back in full, and there will still be over 160,000 bitcoin and bitcoin cash in assets in the Gox estate. The way bankruptcy law works is that if there are any assets remaining after the creditors have been paid in full, then those assets are distributed to shareholders as part of the liquidation.
That's the only way any bankruptcy law can reasonably work. And yet, in this case, it produces an egregiously distasteful outcome in that the shareholders of MtGox would walk away with the value of over 160,000 bitcoin as a result of what happened.
I don't want this. I don't want this billion dollars. From day one I never expected to receive anything from this bankruptcy. The fact that today this is a possibility is an aberration and I believe it is my responsibility to make sure it doesn’t happen. One of the ways to do this would be civil rehabilitation, and as it seems most creditors agree with this, I am doing my best to help make it happen. I do not want to become instantly rich. I do not ask for forgiveness. I just want to see this end as soon as possible with everyone receiving their share of what they had on MtGox so everyone, myself included, can get some closure.
I’m an engineer at heart. I want to build things. I like seeing what I build being useful, and people being happy using what I build. My drive, from day one, has been to push the limits of what is technically possible, and this is the main reason I liked and have been involved with Bitcoin in the first place. When I took over MtGox, I never imagined things would end this way and I am forever sorry for everything that’s taken place and all the effect it had on everyone involved.
Hopefully, I can make what I’ve learned in this experience useful to the community as a whole, so there can at least be something positive in the end.
Ask me anything you like.
EDIT: With this coming to all there have been an overwhelming number of messages, questions etc. I will continue responding for a little while but probably won't be able to respond to new questions (it is starting to be late here and I've been spending the last few hours typing). Thank you very much to everyone.
submitted by MagicalTux to btc [link] [comments]

Beginner’s Guide to BitMEX

Beginner’s Guide to BitMEX

https://preview.redd.it/fl5e0q7i3cc41.jpg?width=1024&format=pjpg&auto=webp&s=445485d722839a9adc1ae13db4c965b0ae3e67b7
Founded by HDR Global Trading Limited (which in turn was founded by former bankers Arthur Hayes, Samuel Reed and Ben Delo) in 2014, BitMEX is a trading platform operating around the world and registered in the Seychelles.
Meaning Bitcoin Mercantile Exchange, BitMEX is one of the largest Bitcoin trading platforms currently operating, with a daily trading volume of over 35,000 BTC and over 540,000 accesses monthly and a trading history of over $34 billion worth of Bitcoin since its inception.

https://preview.redd.it/coenpm4k3cc41.jpg?width=808&format=pjpg&auto=webp&s=8832dcafa5bd615b511bbeb6118ef43d73ed785e
Unlike many other trading exchanges, BitMEX only accepts deposits through Bitcoin, which can then be used to purchase a variety of other cryptocurrencies. BitMEX specialises in sophisticated financial operations such as margin trading, which is trading with leverage. Like many of the exchanges that operate through cryptocurrencies, BitMEX is currently unregulated in any jurisdiction.
Visit BitMEX

How to Sign Up to BitMEX

In order to create an account on BitMEX, users first have to register with the website. Registration only requires an email address, the email address must be a genuine address as users will receive an email to confirm registration in order to verify the account. Once users are registered, there are no trading limits. Traders must be at least 18 years of age to sign up.
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However, it should be noted that BitMEX does not accept any US-based traders and will use IP checks to verify that users are not in the US. While some US users have bypassed this with the use of a VPN, it is not recommended that US individuals sign up to the BitMEX service, especially given the fact that alternative exchanges are available to service US customers that function within the US legal framework.
How to Use BitMEX
BitMEX allows users to trade cryptocurrencies against a number of fiat currencies, namely the US Dollar, the Japanese Yen and the Chinese Yuan. BitMEX allows users to trade a number of different cryptocurrencies, namely Bitcoin, Bitcoin Cash, Dash, Ethereum, Ethereum Classic, Litecoin, Monero, Ripple, Tezos and Zcash.
The trading platform on BitMEX is very intuitive and easy to use for those familiar with similar markets. However, it is not for the beginner. The interface does look a little dated when compared to newer exchanges like Binance and Kucoin’s.
Once users have signed up to the platform, they should click on Trade, and all the trading instruments will be displayed beneath.
Clicking on the particular instrument opens the orderbook, recent trades, and the order slip on the left. The order book shows three columns – the bid value for the underlying asset, the quantity of the order, and the total USD value of all orders, both short and long.
The widgets on the trading platform can be changed according to the user’s viewing preferences, allowing users to have full control on what is displayed. It also has a built in feature that provides for TradingView charting. This offers a wide range of charting tool and is considered to be an improvement on many of the offering available from many of its competitors.
https://preview.redd.it/fabg1nxo3cc41.jpg?width=808&format=pjpg&auto=webp&s=6d939889c3eac15ab1e78ec37a8ccd13fc5e0573
Once trades are made, all orders can be easily viewed in the trading platform interface. There are tabs where users can select their Active Orders, see the Stops that are in place, check the Orders Filled (total or partially) and the trade history. On the Active Orders and Stops tabs, traders can cancel any order, by clicking the “Cancel” button. Users also see all currently open positions, with an analysis if it is in the black or red.
BitMEX uses a method called auto-deleveraging which BitMEX uses to ensure that liquidated positions are able to be closed even in a volatile market. Auto-deleveraging means that if a position bankrupts without available liquidity, the positive side of the position deleverages, in order of profitability and leverage, the highest leveraged position first in queue. Traders are always shown where they sit in the auto-deleveraging queue, if such is needed.
Although the BitMEX platform is optimized for mobile, it only has an Android app (which is not official). There is no iOS app available at present. However, it is recommended that users use it on the desktop if possible.
BitMEX offers a variety of order types for users:
  • Limit Order (the order is fulfilled if the given price is achieved);
  • Market Order (the order is executed at current market price);
  • Stop Limit Order (like a stop order, but allows users to set the price of the Order once the Stop Price is triggered);
  • Stop Market Order (this is a stop order that does not enter the order book, remain unseen until the market reaches the trigger);
  • Trailing Stop Order (it is similar to a Stop Market order, but here users set a trailing value that is used to place the market order);
  • Take Profit Limit Order (this can be used, similarly to a Stop Order, to set a target price on a position. In this case, it is in respect of making gains, rather than cutting losses);
  • Take Profit Market Order (same as the previous type, but in this case, the order triggered will be a market order, and not a limit one)
The exchange offers margin trading in all of the cryptocurrencies displayed on the website. It also offers to trade with futures and derivatives – swaps.

Futures and Swaps

A futures contract is an agreement to buy or sell a given asset in the future at a predetermined price. On BitMEX, users can leverage up to 100x on certain contracts.
Perpetual swaps are similar to futures, except that there is no expiry date for them and no settlement. Additionally, they trade close to the underlying reference Index Price, unlike futures, which may diverge substantially from the Index Price.
BitMEX also offers Binary series contracts, which are prediction-based contracts which can only settle at either 0 or 100. In essence, the Binary series contracts are a more complicated way of making a bet on a given event.
The only Binary series betting instrument currently available is related to the next 1mb block on the Bitcoin blockchain. Binary series contracts are traded with no leverage, a 0% maker fee, a 0.25% taker fee and 0.25% settlement fee.

Bitmex Leverage

BitMEX allows its traders to leverage their position on the platform. Leverage is the ability to place orders that are bigger than the users’ existing balance. This could lead to a higher profit in comparison when placing an order with only the wallet balance. Trading in such conditions is called “Margin Trading.”
There are two types of Margin Trading: Isolated and Cross-Margin. The former allows the user to select the amount of money in their wallet that should be used to hold their position after an order is placed. However, the latter provides that all of the money in the users’ wallet can be used to hold their position, and therefore should be treated with extreme caution.
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The BitMEX platform allows users to set their leverage level by using the leverage slider. A maximum leverage of 1:100 is available (on Bitcoin and Bitcoin Cash). This is quite a high level of leverage for cryptocurrencies, with the average offered by other exchanges rarely exceeding 1:20.

BitMEX Fees

For traditional futures trading, BitMEX has a straightforward fee schedule. As noted, in terms of leverage offered, BitMEX offers up to 100% leverage, with the amount off leverage varying from product to product.
However, it should be noted that trading at the highest leverages is sophisticated and is intended for professional investors that are familiar with speculative trading. The fees and leverage are as follows:
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However, there are additional fees for hidden / iceberg orders. A hidden order pays the taker fee until the entire hidden quantity is completely executed. Then, the order will become normal, and the user will receive the maker rebate for the non-hidden amount.

Deposits and Withdrawals

BitMEX does not charge fees on deposits or withdrawals. However, when withdrawing Bitcoin, the minimum Network fee is based on blockchain load. The only costs therefore are those of the banks or the cryptocurrency networks.
As noted previously, BitMEX only accepts deposits in Bitcoin and therefore Bitcoin serves as collateral on trading contracts, regardless of whether or not the trade involves Bitcoin.
The minimum deposit is 0.001 BTC. There are no limits on withdrawals, but withdrawals can also be in Bitcoin only. To make a withdrawal, all that users need to do is insert the amount to withdraw and the wallet address to complete the transfer.
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Deposits can be made 24/7 but withdrawals are processed by hand at a recurring time once per day. The hand processed withdrawals are intended to increase the security levels of users’ funds by providing extra time (and email notice) to cancel any fraudulent withdrawal requests, as well as bypassing the use of automated systems & hot wallets which may be more prone to compromise.

Supported Currencies

BitMEX operates as a crypto to crypto exchange and makes use of a Bitcoin-in/Bitcoin-out structure. Therefore, platform users are currently unable to use fiat currencies for any payments or transfers, however, a plus side of this is that there are no limits for trading and the exchange incorporates trading pairs linked to the US Dollar (XBT), Japanese Yen (XBJ), and Chinese Yuan (XBC).
BitMEX supports the following cryptocurrencies:
  • Bitcoin (XBT)
  • Bitcoin Cash (BCH)
  • Ethereum (ETH)
  • Ethereum Classic (ETC)
  • Litecoin (LTC)
  • Ripple Token (XRP)
  • Monero (XMR)
  • Dash (DASH)
  • Zcash (ZEC)
  • Cardano (ADA)
  • Tron (TRX)
  • EOS Token (EOS)
BitMEX also offers leverage options on the following coins:
  • 5x: Zcash (ZEC)
  • 20x : Ripple (XRP),Bitcoin Cash (BCH), Cardano (ADA), EOS Token (EOS), Tron (TRX)
  • 25x: Monero (XMR)
  • 33x: Litecoin (LTC)
  • 50x: Ethereum (ETH)
  • 100x: Bitcoin (XBT), Bitcoin / Yen (XBJ), Bitcoin / Yuan (XBC)

Trading Technologies International Partnership

HDR Global Trading, the company which owns BitMEX, has recently announced a partnership with Trading Technologies International, Inc. (TT), a leading international high-performance trading software provider.
The TT platform is designed specifically for professional traders, brokers, and market-access providers, and incorporates a wide variety of trading tools and analytical indicators that allow even the most advanced traders to customize the software to suit their unique trading styles. The TT platform also provides traders with global market access and trade execution through its privately managed infrastructure and the partnership will see BitMEX users gaining access to the trading tools on all BitMEX products, including the popular XBT/USD Perpetual Swap pairing.
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The BitMEX Insurance Fund

The ability to trade on leverage is one of the exchange’s main selling points and offering leverage and providing the opportunity for traders to trade against each other may result in a situation where the winners do not receive all of their expected profits. As a result of the amounts of leverage involved, it’s possible that the losers may not have enough margin in their positions to pay the winners.
Traditional exchanges like the Chicago Mercantile Exchange (CME) offset this problem by utilizing multiple layers of protection and cryptocurrency trading platforms offering leverage cannot currently match the levels of protection provided to winning traders.
In addition, cryptocurrency exchanges offering leveraged trades propose a capped downside and unlimited upside on a highly volatile asset with the caveat being that on occasion, there may not be enough funds in the system to pay out the winners.
To help solve this problem, BitMEX has developed an insurance fund system, and when a trader has an open leveraged position, their position is forcefully closed or liquidated when their maintenance margin is too low.
Here, a trader’s profit and loss does not reflect the actual price their position was closed on the market, and with BitMEX when a trader is liquidated, their equity associated with the position drops down to zero.
In the following example, the trader has taken a 100x long position. In the event that the mark price of Bitcoin falls to $3,980 (by 0.5%), then the position gets liquidated with the 100 Bitcoin position needing to be sold on the market.
This means that it does not matter what price this trade executes at, namely if it’s $3,995 or $3,000, as from the view of the liquidated trader, regardless of the price, they lose all the equity they had in their position, and lose the entire one Bitcoin.
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Assuming there is a fully liquid market, the bid/ask spread should be tighter than the maintenance margin. Here, liquidations manifest as contributions to the insurance fund (e.g. if the maintenance margin is 50bps, but the market is 1bp wide), and the insurance fund should rise by close to the same amount as the maintenance margin when a position is liquidated. In this scenario, as long as healthy liquid markets persist, the insurance fund should continue its steady growth.
The following graphs further illustrate the example, and in the first chart, market conditions are healthy with a narrow bid/ask spread (just $2) at the time of liquidation. Here, the closing trade occurs at a higher price than the bankruptcy price (the price where the margin balance is zero) and the insurance fund benefits.
Illustrative example of an insurance contribution – Long 100x with 1 BTC collateral
https://preview.redd.it/is89ep924cc41.png?width=699&format=png&auto=webp&s=f0419c68fe88703e594c121b5b742c963c7e2229
(Note: The above illustration is based on opening a 100x long position at $4,000 per BTC and 1 Bitcoin of collateral. The illustration is an oversimplification and ignores factors such as fees and other adjustments.
The bid and offer prices represent the state of the order book at the time of liquidation. The closing trade price is $3,978, representing $1 of slippage compared to the $3,979 bid price at the time of liquidation.)
The second chart shows a wide bid/ask spread at the time of liquidation, here, the closing trade takes place at a lower price than the bankruptcy price, and the insurance fund is used to make sure that winning traders receive their expected profits.
This works to stabilize the potential for returns as there is no guarantee that healthy market conditions can continue, especially during periods of heightened price volatility. During these periods, it’s actually possible that the insurance fund can be used up than it is built up.
Illustrative example of an insurance depletion – Long 100x with 1 BTC collateral
https://preview.redd.it/vb4mj3n54cc41.png?width=707&format=png&auto=webp&s=0c63b7c99ae1c114d8e3b947fb490e9144dfe61b
(Notes: The above illustration is based on opening a 100x long position at $4,000 per BTC and 1 Bitcoin of collateral. The illustration is an oversimplification and ignores factors such as fees and other adjustments.
The bid and offer prices represent the state of the order book at the time of liquidation. The closing trade price is $3,800, representing $20 of slippage compared to the $3,820 bid price at the time of liquidation.)
The exchange declared in February 2019, that the BitMEX insurance fund retained close to 21,000 Bitcoin (around $70 million based on Bitcoin spot prices at the time).
This figure represents just 0.007% of BitMEX’s notional annual trading volume, which has been quoted as being approximately $1 trillion. This is higher than the insurance funds as a proportion of trading volume of the CME, and therefore, winning traders on BitMEX are exposed to much larger risks than CME traders as:
  • BitMEX does not have clearing members with large balance sheets and traders are directly exposed to each other.
  • BitMEX does not demand payments from traders with negative account balances.
  • The underlying instruments on BitMEX are more volatile than the more traditional instruments available on CME.
Therefore, with the insurance fund remaining capitalized, the system effectively with participants who get liquidated paying for liquidations, or a losers pay for losers mechanism.
This system may appear controversial as first, though some may argue that there is a degree of uniformity to it. It’s also worth noting that the exchange also makes use of Auto Deleveraging which means that on occasion, leveraged positions in profit can still be reduced during certain time periods if a liquidated order cannot be executed in the market.
More adventurous traders should note that while the insurance fund holds 21,000 Bitcoin, worth approximately 0.1% of the total Bitcoin supply, BitMEX still doesn’t offer the same level of guarantees to winning traders that are provided by more traditional leveraged trading platforms.
Given the inherent volatility of the cryptocurrency market, there remains some possibility that the fund gets drained down to zero despite its current size. This may result in more successful traders lacking confidence in the platform and choosing to limit their exposure in the event of BitMEX being unable to compensate winning traders.

How suitable is BitMEX for Beginners?

BitMEX generates high Bitcoin trading levels, and also attracts good levels of volume across other crypto-to-crypto transfers. This helps to maintain a buzz around the exchange, and BitMEX also employs relatively low trading fees, and is available round the world (except to US inhabitants).
This helps to attract the attention of people new to the process of trading on leverage and when getting started on the platform there are 5 main navigation Tabs to get used to:
  • **Trade:**The trading dashboard of BitMEX. This tab allows you to select your preferred trading instrument, and choose leverage, as well as place and cancel orders. You can also see your position information and view key information in the contract details.
  • **Account:**Here, all your account information is displayed including available Bitcoin margin balances, deposits and withdrawals, and trade history.
  • **Contracts:**This tab covers further instrument information including funding history, contract sizes; leverage offered expiry, underlying reference Price Index data, and other key features.
  • **References:**This resource centre allows you to learn about futures, perpetual contracts, position marking, and liquidation.
  • **API:**From here you can set up an API connection with BitMEX, and utilize the REST API and WebSocket API.
BitMEX also employs 24/7 customer support and the team can also be contacted on their Twitter and Reddit accounts.
In addition, BitMEX provides a variety of educational resources including an FAQ section, Futures guides, Perpetual Contracts guides, and further resources in the “References” account tab.
For users looking for more in depth analysis, the BitMEX blog produces high level descriptions of a number of subjects and has garnered a good reputation among the cryptocurrency community.
Most importantly, the exchange also maintains a testnet platform, built on top of testnet Bitcoin, which allows anyone to try out programs and strategies before moving on to the live exchange.
This is crucial as despite the wealth of resources available, BitMEX is not really suitable for beginners, and margin trading, futures contracts and swaps are best left to experienced, professional or institutional traders.
Margin trading and choosing to engage in leveraged activity are risky processes and even more advanced traders can describe the process as a high risk and high reward “game”. New entrants to the sector should spend a considerable amount of time learning about margin trading and testing out strategies before considering whether to open a live account.

Is BitMEX Safe?

BitMEX is widely considered to have strong levels of security. The platform uses multi-signature deposits and withdrawal schemes which can only be used by BitMEX partners. BitMEX also utilises Amazon Web Services to protect the servers with text messages and two-factor authentication, as well as hardware tokens.
BitMEX also has a system for risk checks, which requires that the sum of all account holdings on the website must be zero. If it’s not, all trading is immediately halted. As noted previously, withdrawals are all individually hand-checked by employees, and private keys are never stored in the cloud. Deposit addresses are externally verified to make sure that they contain matching keys. If they do not, there is an immediate system shutdown.
https://preview.redd.it/t04qs3484cc41.jpg?width=808&format=pjpg&auto=webp&s=a3b106cbc9116713dcdd5e908c00b555fd704ee6
In addition, the BitMEX trading platform is written in kdb+, a database and toolset popular amongst major banks in high frequency trading applications. The BitMEX engine appears to be faster and more reliable than some of its competitors, such as Poloniex and Bittrex.
They have email notifications, and PGP encryption is used for all communication.
The exchange hasn’t been hacked in the past.

How Secure is the platform?

As previously mentioned, BitMEX is considered to be a safe exchange and incorporates a number of security protocols that are becoming standard among the sector’s leading exchanges. In addition to making use of Amazon Web Services’ cloud security, all the exchange’s systems can only be accessed after passing through multiple forms of authentication, and individual systems are only able to communicate with each other across approved and monitored channels.
Communication is also further secured as the exchange provides optional PGP encryption for all automated emails, and users can insert their PGP public key into the form inside their accounts.
Once set up, BitMEX will encrypt and sign all the automated emails sent by you or to your account by the [[email protected]](mailto:[email protected]) email address. Users can also initiate secure conversations with the support team by using the email address and public key on the Technical Contact, and the team have made their automated system’s PGP key available for verification in their Security Section.
The platform’s trading engine is written in kdb+, a database and toolset used by leading financial institutions in high-frequency trading applications, and the speed and reliability of the engine is also used to perform a full risk check after every order placement, trade, settlement, deposit, and withdrawal.
All accounts in the system must consistently sum to zero, and if this does not happen then trading on the platform is immediately halted for all users.
With regards to wallet security, BitMEX makes use of a multisignature deposit and withdrawal scheme, and all exchange addresses are multisignature by default with all storage being kept offline. Private keys are not stored on any cloud servers and deep cold storage is used for the majority of funds.
Furthermore, all deposit addresses sent by the BitMEX system are verified by an external service that works to ensure that they contain the keys controlled by the founders, and in the event that the public keys differ, the system is immediately shut down and trading halted. The exchange’s security practices also see that every withdrawal is audited by hand by a minimum of two employees before being sent out.

BitMEX Customer Support

The trading platform has a 24/7 support on multiple channels, including email, ticket systems and social media. The typical response time from the customer support team is about one hour, and feedback on the customer support generally suggest that the customer service responses are helpful and are not restricted to automated responses.
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The BitMEX also offers a knowledge base and FAQs which, although they are not necessarily always helpful, may assist and direct users towards the necessary channels to obtain assistance.
BitMEX also offers trading guides which can be accessed here

Conclusion

There would appear to be few complaints online about BitMEX, with most issues relating to technical matters or about the complexities of using the website. Older complaints also appeared to include issues relating to low liquidity, but this no longer appears to be an issue.
BitMEX is clearly not a platform that is not intended for the amateur investor. The interface is complex and therefore it can be very difficult for users to get used to the platform and to even navigate the website.
However, the platform does provide a wide range of tools and once users have experience of the platform they will appreciate the wide range of information that the platform provides.
Visit BitMEX
submitted by bitmex_register to u/bitmex_register [link] [comments]

Crypto Investing Guide: Useful resources and tools, and how to create an investment strategy

Lots of people have PM'd me asking me the same questions on where to find information and how to put together their portfolio so I decided to put a guide for crypto investors, especially those who have only been in a few months and are still confused.
Many people entered recently at a time when the market was rewarding the very worst type of investment behavior. Unfortunately there aren't many guides and a lot of people end up looking at things like Twitter or the trending Youtube crypto videos, which is dominated by "How to make $1,00,000 by daytrading crypto" and influencers like CryptoNick.
So I'll try to put together a guide from what I've learned and some tips, on how to invest in this asset class. This is going to be Part 1, in another post later I'll post a systematic approach to valuation and picking individual assets.

Getting started: Tools and resources

You don't have to be a programmer or techie to invest in crypto, but you should first learn the basics of how it functions. I find that this video by 3Blue1Brown is the best introduction to what a blockchain actually is and how it functions, because it explains it clearly and simply with visuals while not dumbing it down too much. If you want a more ELI5 version with cute cartoons, then Upfolio has a nice beginner's intro to the blockchain concept and quick descriptions of top 100 cryptocurrencies. I also recommend simply going to Wikipedia and reading the blockchain and cryptocurrency page and clicking onto a few links in, read about POS vs POW...etc. Later on you'll need this information to understand why a specific use case may or may not benefit from a blockchain structure. Here is a quick summary of the common terms you should know.
Next you should arm yourself with some informational resources. I compiled a convenient list of useful tools and sites that I've used and find to be worthy of bookmarking:
Market information
Analysis tools
Portfolio Tracking
Youtube
I generally don't follow much on Youtube because it's dominated by idiocy like Trevon James and CryptoNick, but there are some that I think are worthy of following:

Constructing a Investment Strategy

I can't stress enough how important it is to construct an actual investment strategy. Organize what your goals are, what your risk tolerance is and how you plan to construct a portfolio to achieve those goals rather than just chasing the flavor of the week.
Why? Because it will force you to slow down and make decisions based on rational thinking rather than emotion, and will also inevitably lead you to think long term.

Setting ROI targets

Bluntly put, a lot of young investors who are in crypto have really unrealistic expectations about returns and risk.
A lot of them have never invested in any other type of financial asset, and hence many seem to consider a 10% ROI in a month to be unexciting, even though that is roughly what they should be aiming for.
I see a ton of people now on this sub and on other sites making their decisions with the expectation to double their money every month. This has lead a worrying amount of newbies putting in way too much money way too quickly into anything on the front page of CoinMarketCap with a low dollar value per coin hoping that crypto get them out of their debt or a life of drudgery in a cubicle. And all in the next year or two!
But its important to temper your hype about returns and realize why we had this exponential growth in the last year. The only reason we saw so much upward price action is because of fiat monetary base expansion from people FOMO-ing in due to media coverage. People are hoping to ride the bubble and sell to a greater fool in a few months, it is classic Greater Fool Theory. That's it. Its not because we are seeing any mass increase in adoption or actual widespread utility with cryptocurrency. We passed the $1,000 psychological marker again for Bitcoin which we hadn't seen since right before the Mt.Gox disaster, and it just snowballed the positivity as headline after headline came out about the price growth. However those unexciting returns of 10% a month are not only the norm, but much more healthy for an alternative investment class. Here are the annual returns for Bitcoin for the last few years:
Year BTC Return
2017 1,300%
2016 120%
2015 35%
2014 -60%
2013 5300%
2012 150 %
Keep in mind that a 10% monthly increase when compounded equals a 313% annual return, or over 3x your money. That may not sound exciting to those who entered recently and saw their money go 20x in a month on something like Tron before it crashed back down, but that 3X annual return is better than Bitcoin's return every year except the year right before the last market meltdown and 2017. I have been saying for a while now that we are due for a major correction and every investor now should be planning for that possibility through proper allocation and setting return expectations that are reasonable.
How to set a realistic ROI target
How do I set my own personal return target?
Basically I aim to achieve a portfolio return of roughly 385% annually (3.85X increase per year) or about 11.89% monthly return when compounded. How did I come up with that target? I base it on the average compounded annual growth return (CAGR) over the last 3 years on the entire market:
Year Total Crypto Market Cap
Jan 1, 2014: $10.73 billion
Jan 1, 2017: $615 billion
Compounded annual growth return (CAGR): (615/10.73)1/3 = 385%
My personal strategy is to sell my portfolio every December then buy back into the market at around the beginning of February and I intend to hold on average for 3 years, so this works for me but you may choose to do it a different way for your own reasons. I think this is a good average to aim for as a general guideline because it includes both the good years (2017) and the bad (2014). Once you have a target you can construct your risk profile (low risk vs. high risk category coins) in your portfolio. If you want to try for a higher CAGR than about 385% then you will likely need to go into more highly speculative picks. I can't tell you what return target you should set for yourself, but just make sure its not depended on you needing to achieve continual near vertical parabolic price action in small cap shillcoins because that isn't sustainable.
As the recent January dip showed while the core cryptos like Bitcoin and Ethereum would dip an X percentage, the altcoins would often drop double or triple that amount. Its a very fragile market, and the type of dumb behavior that people were engaging in that was profitable in a bull market (chasing pumps, going all in on a microcap shillcoin, having an attention span of a squirrel...etc) will lead to consequences. Just like they jumped on the crypto bandwagon without thinking about risk adjusted returns, they will just as quickly jump on whatever bandwagon will be used to blame for the deflation of the bubble, whether the blame is assigned to Wall Steet and Bitcoin futures or Asians or some government.
Nobody who pumped money into garbage without any use case or utility will accept that they themselves and their own unreasonable expectations for returns were the reason for the gross mispricing of most cryptocurrencies.

Risk Management

Quanitifying risk in crypto is surprisingly difficult because the historical returns aren't normally distributed, meaning that tools like Sharpe Ratio and other risk metrics can't really be used as intended. Instead you'll have to think of your own risk tolerance and qualitatively evaluate how risky each crypto is based on the team, the use case prospects, the amount of competition and the general market risk.
You can think of each crypto having a risk factor that is the summation of the general crypto market risk (Rm) as ultimately everything is tied to how Bitcoin does, but also its own inherent risk specific to its own goals (Ri).
Rt = Rm +Ri
The market risk is something you cannot avoid, if some China FUD comes out about regulations on Bitcoin then your investment in solid altcoin picks will go down too along with Bitcoin. This (Rm) return is essentially what risk you undertake to have a market ROI of 385% I talked about above. What you can minimize though is the Ri, the aset specific risks with the team, the likelihood they will actually deliver, the likelihood that their solution will be adopted. Unfortunately there is no one way to do this, you simply have to take the time to research and form your own opinion on how risky it really is before allocating a certain percentage to it. Consider the individual risk of each crypto and start looking for red flags:
  • guaranteed promises of large returns (protip: that's a Ponzi)
  • float allocations that give way too much to the founder
  • vague whitepapers
  • vague timelines
  • no clear use case
  • Github with no useful code and sparse activity
  • a team that is difficult to find information on or even worse anonymous
While all cryptocurrencies are a risky investments but generally you can break down cryptos into "low" risk core, medium risk speculative and high risk speculative
  • Low Risk Core - This is the exchange pairing cryptos and those that are well established. These are almost sure to be around in 5 years, and will recover after any bear market. Bitcoin, Litecoin and Ethereum are in this class of risk, and I would also argue Monero.
  • Medium Risk Speculative - These would be cryptos which generally have at least some product and are reasonably established, but higher risk than Core. Things like ZCash, Ripple, NEO..etc.
  • High Risk Speculative - This is anything created within the last few months, low caps, shillcoins, ICOs...etc. Most cryptos are in this category, most of them will be essentially worthless in 5 years.
How much risk should you take on? That depends on your own life situation but also it should be proportional to how much expertise you have in both financial analysis and technology. If you're a newbie who doesn't understand the tech and has no idea how to value assets, your risk tolerance should be lower than a programmer who understand the tech or a financial analyst who is experienced in valuation metrics.
Right now the trio of BTC-ETH-LTC account for 55% of the market cap, so between 50-70% of your portfolio in low Risk Core for newbies is a great starting point. Then you can go down to 25-30% as you gain confidence and experience. But always try to keep about 1/3rd in safe core positions. Don't go all in on speculative picks.
Core principles to minimize risk
  • Have the majority of your holdings in things you feel good holding for at least 2 years. Don't use the majority of your investment for day trading or short term investing.
  • Consider using dollar cost averaging to enter a position. This generally means investing a X amount over several periods, instead of at once. You can also use downward biased dollar cost averaging to mitigate against downward risk. For example instead of investing $1000 at once in a position at market price, you can buy $500 at the market price today then set several limit orders at slightly lower intervals (for example $250 at 5% lower than market price, $250 at 10% lower than market price). This way your average cost of acquisition will be lower if the crypto happens to decline over the short term.
  • Never chase a pump. Its simply too risky as its such an inefficient and unregulated market. If you continue to do it, most of your money losing decisions will be because you emotionally FOMO-ed into gambling on a symbol.
  • Invest what you can afford to lose. Don't have more than 5-10% of your net worth in crypto.
  • Consider what level of loss you can't accept in a position with a high risk factor, and use stop-limit orders to hedge against sudden crashes. Set you stop price at about 5-10% above your lowest limit. Stop-limit orders aren't perfect but they're better than having no hedging strategy for a risky microcap in case of some meltdown. Only you can determine what bags you are unwilling to hold.
  • Diversify across sectors and rebalance your allocations periodically. Keep about 1/3rd in low risk core holdings.
  • Have some fiat in reserve at a FDIC-insured exchange (ex. Gemini), and be ready to add to your winning positions on a pullback.
  • Remember you didn't actually make any money until you take some profits, so take do some profits when everyone else is at peak FOMO-ing bubble mode. You will also sleep much more comfortably once you take out the equivalent of your principal.

Portfolio Allocation

Along with thinking about your portfolio in terms of risk categories described above, I really find it helpful to think about the segments you are in. OnChainFX has some segment categorization but I generally like to bring it down to:
  • Core holdings - essentially the Low Risk Core segment
  • Platform segment
  • Privacy segment
  • Finance/Bank settlement segment
  • Enterprise Blockchain solutions segment
  • Promising/Innovative Tech segment
This is merely what I use, but I'm sure you can think of your own. The key point I have is to try to invest your medium and high risk picks in a segment you understand well, and in which you can relatively accurately judge risk. If you don't understand anything about how banking works or SWIFT or international settlement layers, don't invest in Stellar. If you have no idea how a supply chain functions, avoid investing in VeChain (even if it's being shilled to death on Reddit at the moment just like XRB was last month).
What's interesting is that often we see like-coin movement, for example when a coin from one segment pumps we will frequently see another similar coin in the same segment go up (think Stellar following after Ripple).
Consider the historic correlations between your holdings. Generally when Bitcoin pumps, altcoins dump but at what rate depends on the coin. When Bitcoin goes sideways we tend to see pumping in altcoins, while when Bitcoin goes down, everything goes down.
You should set price targets for each of your holdings, which is a whole separate discussion I'll go in Part 2 of the guide.

Summing it up

This was meant to get you think about what return targets you should set for your portfolio and how much risk you are willing to take and what strategies you can follow to mitigate that risk.
Returns around 385% (average crypto market CAGR over the last 3 years) would be a good target to aim for while remaining realistic, you can tweak it a bit based on your own risk tolerance. What category of risk your individual crypto picks should be will be determined by how much more greed you have for above average market return. A portfolio of 50% core holdings, 30% medium risk in a sector you understand well and 20% in high risk speculative is probably what the average portfolio should look like, with newbies going more towards 70% core and only 5% high risk speculative.
Just by thinking about these things you'll likely do better than most crypto investors, because most don't think about this stuff, to their own detriment.
submitted by arsonbunny to CryptoMarkets [link] [comments]

CRYPTOCURRENCY BITCOIN

CRYPTOCURRENCY BITCOIN
Bitcoin Table of contents expand: 1. What is Bitcoin? 2. Understanding Bitcoin 3. How Bitcoin Works 4. What's a Bitcoin Worth? 5. How Bitcoin Began 6. Who Invented Bitcoin? 7. Before Satoshi 8. Why Is Satoshi Anonymous? 9. The Suspects 10. Can Satoshi's Identity Be Proven? 11. Receiving Bitcoins As Payment 12. Working For Bitcoins 13. Bitcoin From Interest Payments 14. Bitcoins From Gambling 15. Investing in Bitcoins 16. Risks of Bitcoin Investing 17. Bitcoin Regulatory Risk 18. Security Risk of Bitcoins 19. Insurance Risk 20. Risk of Bitcoin Fraud 21. Market Risk 22. Bitcoin's Tax Risk What is Bitcoin?
Bitcoin is a digital currency created in January 2009. It follows the ideas set out in a white paper by the mysterious Satoshi Nakamoto, whose true identity is yet to be verified. Bitcoin offers the promise of lower transaction fees than traditional online payment mechanisms and is operated by a decentralized authority, unlike government-issued currencies.
There are no physical bitcoins, only balances kept on a public ledger in the cloud, that – along with all Bitcoin transactions – is verified by a massive amount of computing power. Bitcoins are not issued or backed by any banks or governments, nor are individual bitcoins valuable as a commodity. Despite it not being legal tender, Bitcoin charts high on popularity, and has triggered the launch of other virtual currencies collectively referred to as Altcoins.
Understanding Bitcoin Bitcoin is a type of cryptocurrency: Balances are kept using public and private "keys," which are long strings of numbers and letters linked through the mathematical encryption algorithm that was used to create them. The public key (comparable to a bank account number) serves as the address which is published to the world and to which others may send bitcoins. The private key (comparable to an ATM PIN) is meant to be a guarded secret and only used to authorize Bitcoin transmissions. Style notes: According to the official Bitcoin Foundation, the word "Bitcoin" is capitalized in the context of referring to the entity or concept, whereas "bitcoin" is written in the lower case when referring to a quantity of the currency (e.g. "I traded 20 bitcoin") or the units themselves. The plural form can be either "bitcoin" or "bitcoins."
How Bitcoin Works Bitcoin is one of the first digital currencies to use peer-to-peer technology to facilitate instant payments. The independent individuals and companies who own the governing computing power and participate in the Bitcoin network, also known as "miners," are motivated by rewards (the release of new bitcoin) and transaction fees paid in bitcoin. These miners can be thought of as the decentralized authority enforcing the credibility of the Bitcoin network. New bitcoin is being released to the miners at a fixed, but periodically declining rate, such that the total supply of bitcoins approaches 21 million. One bitcoin is divisible to eight decimal places (100 millionths of one bitcoin), and this smallest unit is referred to as a Satoshi. If necessary, and if the participating miners accept the change, Bitcoin could eventually be made divisible to even more decimal places. Bitcoin mining is the process through which bitcoins are released to come into circulation. Basically, it involves solving a computationally difficult puzzle to discover a new block, which is added to the blockchain and receiving a reward in the form of a few bitcoins. The block reward was 50 new bitcoins in 2009; it decreases every four years. As more and more bitcoins are created, the difficulty of the mining process – that is, the amount of computing power involved – increases. The mining difficulty began at 1.0 with Bitcoin's debut back in 2009; at the end of the year, it was only 1.18. As of February 2019, the mining difficulty is over 6.06 billion. Once, an ordinary desktop computer sufficed for the mining process; now, to combat the difficulty level, miners must use faster hardware like Application-Specific Integrated Circuits (ASIC), more advanced processing units like Graphic Processing Units (GPUs), etc.
What's a Bitcoin Worth? In 2017 alone, the price of Bitcoin rose from a little under $1,000 at the beginning of the year to close to $19,000, ending the year more than 1,400% higher. Bitcoin's price is also quite dependent on the size of its mining network since the larger the network is, the more difficult – and thus more costly – it is to produce new bitcoins. As a result, the price of bitcoin has to increase as its cost of production also rises. The Bitcoin mining network's aggregate power has more than tripled over the past twelve months.
How Bitcoin Began
Aug. 18, 2008: The domain name bitcoin.org is registered. Today, at least, this domain is "WhoisGuard Protected," meaning the identity of the person who registered it is not public information.
Oct. 31, 2008: Someone using the name Satoshi Nakamoto makes an announcement on The Cryptography Mailing list at metzdowd.com: "I've been working on a new electronic cash system that's fully peer-to-peer, with no trusted third party. The paper is available at http://www.bitcoin.org/bitcoin.pdf." This link leads to the now-famous white paper published on bitcoin.org entitled "Bitcoin: A Peer-to-Peer Electronic Cash System." This paper would become the Magna Carta for how Bitcoin operates today.
Jan. 3, 2009: The first Bitcoin block is mined, Block 0. This is also known as the "genesis block" and contains the text: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks," perhaps as proof that the block was mined on or after that date, and perhaps also as relevant political commentary.
Jan. 8, 2009: The first version of the Bitcoin software is announced on The Cryptography Mailing list.
Jan. 9, 2009: Block 1 is mined, and Bitcoin mining commences in earnest.
Who Invented Bitcoin?
No one knows. Not conclusively, at any rate. Satoshi Nakamoto is the name associated with the person or group of people who released the original Bitcoin white paper in 2008 and worked on the original Bitcoin software that was released in 2009. The Bitcoin protocol requires users to enter a birthday upon signup, and we know that an individual named Satoshi Nakamoto registered and put down April 5 as a birth date. And that's about it.
Before Satoshi
Though it is tempting to believe the media's spin that Satoshi Nakamoto is a solitary, quixotic genius who created Bitcoin out of thin air, such innovations do not happen in a vacuum. All major scientific discoveries, no matter how original-seeming, were built on previously existing research. There are precursors to Bitcoin: Adam Back’s Hashcash, invented in 1997, and subsequently Wei Dai’s b-money, Nick Szabo’s bit gold and Hal Finney’s Reusable Proof of Work. The Bitcoin white paper itself cites Hashcash and b-money, as well as various other works spanning several research fields.
Why Is Satoshi Anonymous?
There are two primary motivations for keeping Bitcoin's inventor keeping his or her or their identity secret. One is privacy. As Bitcoin has gained in popularity – becoming something of a worldwide phenomenon – Satoshi Nakamoto would likely garner a lot of attention from the media and from governments.
The other reason is safety. Looking at 2009 alone, 32,489 blocks were mined; at the then-reward rate of 50 BTC per block, the total payout in 2009 was 1,624,500 BTC, which at today’s prices is over $900 million. One may conclude that only Satoshi and perhaps a few other people were mining through 2009 and that they possess a majority of that $900 million worth of BTC. Someone in possession of that much BTC could become a target of criminals, especially since bitcoins are less like stocks and more like cash, where the private keys needed to authorize spending could be printed out and literally kept under a mattress. While it's likely the inventor of Bitcoin would take precautions to make any extortion-induced transfers traceable, remaining anonymous is a good way for Satoshi to limit exposure.
The Suspects
Numerous people have been suggested as possible Satoshi Nakamoto by major media outlets. Oct. 10, 2011, The New Yorker published an article speculating that Nakamoto might be Irish cryptography student Michael Clear or economic sociologist Vili Lehdonvirta. A day later, Fast Company suggested that Nakamoto could be a group of three people – Neal King, Vladimir Oksman and Charles Bry – who together appear on a patent related to secure communications that were filed two months before bitcoin.org was registered. A Vice article published in May 2013 added more suspects to the list, including Gavin Andresen, the Bitcoin project’s lead developer; Jed McCaleb, co-founder of now-defunct Bitcoin exchange Mt. Gox; and famed Japanese mathematician Shinichi Mochizuki.
In December 2013, Techcrunch published an interview with researcher Skye Grey who claimed textual analysis of published writings shows a link between Satoshi and bit-gold creator Nick Szabo. And perhaps most famously, in March 2014, Newsweek ran a cover article claiming that Satoshi is actually an individual named Satoshi Nakamoto – a 64-year-old Japanese-American engineer living in California. The list of suspects is long, and all the individuals deny being Satoshi.
Can Satoshi's Identity Be Proven?
It would seem even early collaborators on the project don’t have verifiable proof of Satoshi’s identity. To reveal conclusively who Satoshi Nakamoto is, a definitive link would need to be made between his/her activity with Bitcoin and his/her identity. That could come in the form of linking the party behind the domain registration of bitcoin.org, email and forum accounts used by Satoshi Nakamoto, or ownership of some portion of the earliest mined bitcoins. Even though the bitcoins Satoshi likely possesses are traceable on the blockchain, it seems he/she has yet to cash them out in a way that reveals his/her identity. If Satoshi were to move his/her bitcoins to an exchange today, this might attract attention, but it seems unlikely that a well-funded and successful exchange would betray a customer's privacy.
Receiving Bitcoins As Payment
Bitcoins can be accepted as a means of payment for products sold or services provided. If you have a brick and mortar store, just display a sign saying “Bitcoin Accepted Here” and many of your customers may well take you up on it; the transactions can be handled with the requisite hardware terminal or wallet address through QR codes and touch screen apps. An online business can easily accept bitcoins by just adding this payment option to the others it offers, like credit cards, PayPal, etc. Online payments will require a Bitcoin merchant tool (an external processor like Coinbase or BitPay).
Working For Bitcoins
Those who are self-employed can get paid for a job in bitcoins. There are several websites/job boards which are dedicated to the digital currency:
Work For Bitcoin brings together work seekers and prospective employers through its websiteCoinality features jobs – freelance, part-time and full-time – that offer payment in bitcoins, as well as Dogecoin and LitecoinJobs4Bitcoins, part of reddit.comBitGigs
Bitcoin From Interest Payments
Another interesting way (literally) to earn bitcoins is by lending them out and being repaid in the currency. Lending can take three forms – direct lending to someone you know; through a website which facilitates peer-to-peer transactions, pairing borrowers and lenders; or depositing bitcoins in a virtual bank that offers a certain interest rate for Bitcoin accounts. Some such sites are Bitbond, BitLendingClub, and BTCjam. Obviously, you should do due diligence on any third-party site.
Bitcoins From Gambling
It’s possible to play at casinos that cater to Bitcoin aficionados, with options like online lotteries, jackpots, spread betting, and other games. Of course, the pros and cons and risks that apply to any sort of gambling and betting endeavors are in force here too.
Investing in Bitcoins
There are many Bitcoin supporters who believe that digital currency is the future. Those who endorse it are of the view that it facilitates a much faster, no-fee payment system for transactions across the globe. Although it is not itself any backed by any government or central bank, bitcoin can be exchanged for traditional currencies; in fact, its exchange rate against the dollar attracts potential investors and traders interested in currency plays. Indeed, one of the primary reasons for the growth of digital currencies like Bitcoin is that they can act as an alternative to national fiat money and traditional commodities like gold.
In March 2014, the IRS stated that all virtual currencies, including bitcoins, would be taxed as property rather than currency. Gains or losses from bitcoins held as capital will be realized as capital gains or losses, while bitcoins held as inventory will incur ordinary gains or losses.
Like any other asset, the principle of buying low and selling high applies to bitcoins. The most popular way of amassing the currency is through buying on a Bitcoin exchange, but there are many other ways to earn and own bitcoins. Here are a few options which Bitcoin enthusiasts can explore.
Risks of Bitcoin Investing
Though Bitcoin was not designed as a normal equity investment (no shares have been issued), some speculative investors were drawn to the digital money after it appreciated rapidly in May 2011 and again in November 2013. Thus, many people purchase bitcoin for its investment value rather than as a medium of exchange.
However, their lack of guaranteed value and digital nature means the purchase and use of bitcoins carries several inherent risks. Many investor alerts have been issued by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), the Consumer Financial Protection Bureau (CFPB), and other agencies.
The concept of a virtual currency is still novel and, compared to traditional investments, Bitcoin doesn't have much of a long-term track record or history of credibility to back it. With their increasing use, bitcoins are becoming less experimental every day, of course; still, after eight years, they (like all digital currencies) remain in a development phase, still evolving. "It is pretty much the highest-risk, highest-return investment that you can possibly make,” says Barry Silbert, CEO of Digital Currency Group, which builds and invests in Bitcoin and blockchain companies.
Bitcoin Regulatory Risk
Investing money into Bitcoin in any of its many guises is not for the risk-averse. Bitcoins are a rival to government currency and may be used for black market transactions, money laundering, illegal activities or tax evasion. As a result, governments may seek to regulate, restrict or ban the use and sale of bitcoins, and some already have. Others are coming up with various rules. For example, in 2015, the New York State Department of Financial Services finalized regulations that would require companies dealing with the buy, sell, transfer or storage of bitcoins to record the identity of customers, have a compliance officer and maintain capital reserves. The transactions worth $10,000 or more will have to be recorded and reported.
Although more agencies will follow suit, issuing rules and guidelines, the lack of uniform regulations about bitcoins (and other virtual currency) raises questions over their longevity, liquidity, and universality.
Security Risk of Bitcoins
Bitcoin exchanges are entirely digital and, as with any virtual system, are at risk from hackers, malware and operational glitches. If a thief gains access to a Bitcoin owner's computer hard drive and steals his private encryption key, he could transfer the stolen Bitcoins to another account. (Users can prevent this only if bitcoins are stored on a computer which is not connected to the internet, or else by choosing to use a paper wallet – printing out the Bitcoin private keys and addresses, and not keeping them on a computer at all.) Hackers can also target Bitcoin exchanges, gaining access to thousands of accounts and digital wallets where bitcoins are stored. One especially notorious hacking incident took place in 2014, when Mt. Gox, a Bitcoin exchange in Japan, was forced to close down after millions of dollars worth of bitcoins were stolen.
This is particularly problematic once you remember that all Bitcoin transactions are permanent and irreversible. It's like dealing with cash: Any transaction carried out with bitcoins can only be reversed if the person who has received them refunds them. There is no third party or a payment processor, as in the case of a debit or credit card – hence, no source of protection or appeal if there is a problem.
Insurance Risk
Some investments are insured through the Securities Investor Protection Corporation. Normal bank accounts are insured through the Federal Deposit Insurance Corporation (FDIC) up to a certain amount depending on the jurisdiction. Bitcoin exchanges and Bitcoin accounts are not insured by any type of federal or government program.
Risk of Bitcoin Fraud
While Bitcoin uses private key encryption to verify owners and register transactions, fraudsters and scammers may attempt to sell false bitcoins. For instance, in July 2013, the SEC brought legal action against an operator of a Bitcoin-related Ponzi scheme.
Market Risk
Like with any investment, Bitcoin values can fluctuate. Indeed, the value of the currency has seen wild swings in price over its short existence. Subject to high volume buying and selling on exchanges, it has a high sensitivity to “news." According to the CFPB, the price of bitcoins fell by 61% in a single day in 2013, while the one-day price drop in 2014 has been as big as 80%.
If fewer people begin to accept Bitcoin as a currency, these digital units may lose value and could become worthless. There is already plenty of competition, and though Bitcoin has a huge lead over the other 100-odd digital currencies that have sprung up, thanks to its brand recognition and venture capital money, a technological break-through in the form of a better virtual coin is always a threat.
Bitcoin's Tax Risk
As bitcoin is ineligible to be included in any tax-advantaged retirement accounts, there are no good, legal options to shield investments from taxation.
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Related Terms
Satoshi
The satoshi is the smallest unit of the bitcoin cryptocurrency. It is named after Satoshi Nakamoto, the creator of the protocol used in block chains and the bitcoin cryptocurrency.
Chartalism Chartalism is a non-mainstream theory of money that emphasizes the impact of government policies and activities on the value of money.
Satoshi Nakamoto The name used by the unknown creator of the protocol used in the bitcoin cryptocurrency. Satoshi Nakamoto is closely-associated with blockchain technology.
Bitcoin Mining, Explained Breaking down everything you need to know about Bitcoin Mining, from Blockchain and Block Rewards to Proof-of-Work and Mining Pools.
Understanding Bitcoin Unlimited Bitcoin Unlimited is a proposed upgrade to Bitcoin Core that allows larger block sizes. The upgrade is designed to improve transaction speed through scale.
Blockchain Explained
A guide to help you understand what blockchain is and how it can be used by industries. You've probably encountered a definition like this: “blockchain is a distributed, decentralized, public ledger." But blockchain is easier to understand than it sounds.
Top 6 Books to Learn About Bitcoin About UsAdvertiseContactPrivacy PolicyTerms of UseCareers Investopedia is part of the Dotdash publishing family.The Balance Lifewire TripSavvy The Spruceand more
By Satoshi Nakamoto
Read it once, go read other crypto stuff, read it again… keep doing this until the whole document makes sense. It’ll take a while, but you’ll get there. This is the original whitepaper introducing and explaining Bitcoin, and there’s really nothing better out there to understand on the subject.
“What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party

submitted by adrian_morrison to BlockchainNews [link] [comments]

batching in Bitcoin

On May 6th, 2017, Bitcoin hit an all-time high in transactions processed on the network in a single day: it moved 375,000 transactions which accounted for a nominal output of about $2.5b. Average fees on the Bitcoin network had climbed over a dollar for the first time a couple days prior. And they kept climbing: by early June average fees hit an eye-watering $5.66. This was quite unprecedented. In the three-year period from Jan. 1 2014 to Jan. 1 2017, per-transaction fees had never exceeded 31 cents on a weekly average. And the hits kept coming. Before 2017 was over, average fees would top out at $48 on a weekly basis. When the crypto-recession set in, transaction count collapsed and fees crept back below $1.
During the most feverish days of the Bitcoin run-up, when normal users found themselves with balances that would cost more to send than they were worth, cries for batching — the aggregation of many outputs into a single transaction — grew louder than ever. David Harding had written a blog post on the cost-savings of batching at the end of August and it was reposted to the Bitcoin subreddit on a daily basis.
The idea was simple: for entities sending many transactions at once, clustering outputs into a single transaction was more space- (and cost-) efficient, because each transaction has a fixed data overhead. David found that if you combined 10 payments into one transaction, rather than sending them individually, you could save 75% of the block space. Essentially, batching is one way to pack as many transactions as possible into the finite block space available on Bitcoin.
When fees started climbing in mid-2017, users began to scrutinize the behavior of heavy users of the Bitcoin blockchain, to determine whether they were using block space efficiently. By and large, they were not — and an informal lobbying campaign began, in which these major users — principally exchanges — were asked to start batching transactions and be good stewards of the scarce block space at their disposal. Some exchanges had been batching for years, others relented and implemented it. The question faded from view after Bitcoin’s price collapsed in Q1 2018 from roughly $19,000 to $6000, and transaction load — and hence average fee — dropped off.
But we remained curious. A common refrain, during the collapse in on-chain usage, was that transaction count was an obfuscated method of apprehending actual usage. The idea was that transactions could encode an arbitrarily large (within reason) number of payments, and so if batching had become more and more prevalent, those payments were still occurring, just under a regime of fewer transactions.

“hmmm”
Some sites popped up to report outputs and payments per day rather than transactions, seemingly bristling at the coverage of declining transaction count. However, no one conducted an analysis of the changing relationship between transaction count and outputs or payments. We took it upon ourselves to find out.
Table Of Contents:
Introduction to batching
A timeline
Analysis
Conclusion
Bonus content: UTXO consolidation
  1. Introduction to batching
Bitcoin uses a UTXO model, which stands for Unspent Transaction Output. In comparison, Ripple and Ethereum use an account/balance model. In bitcoin, a user has no balances, only UTXOs that they control. If they want to transfer money to someone else, their wallet selects one or more UTXOs as inputs that in sum need to add up to the amount they want to transfer. The desired amount then goes to the recipient, which is called the output, and the difference goes back to the sender, which is called change output. Each output can carry a virtually unlimited amount of value in the form of satoshis. A satoshi is a unit representing a one-hundred-millionth of a Bitcoin. This is very similar to a physical wallet full of different denominations of bills. If you’re buying a snack for $2.50 and only have a $5, you don’t hand the cashier half of your 5 dollar bill — you give him the 5 and receive some change instead.
Unknown to some, there is no hardcoded limit to the number of transactions that can fit in a block. Instead, each transaction has a certain size in megabytes and constitutes an economic incentive for miners to include it in their block. Because miners have limited space of 2 MB to sell to transactors, larger transactions (in size, not bitcoin!) will need to pay higher fees to be included. Additionally, each transaction can have a virtually unlimited number of inputs or outputs — the record stands at transactions with 20,000 inputs and 13,107 outputs.
So each transaction has at least one input and at one output, but often more, as well as some additional boilerplate stuff. Most of that space is taken up by the input (often 60% or more, because of the signature that proves they really belong to the sender), while the output(s) account for 15–30%. In order to keep transactions as small as possible and save fees, Bitcoin users have two major choices:
Use as few inputs as possible. In order to minimize inputs, you can periodically send your smaller UTXOs to yourself in times when fees are very low, getting one large UTXO back. That is called UTXO consolidation or consolidating your inputs.
Users who frequently make transfers (especially within the same block) can include an almost unlimited amount of outputs (to different people!) in the same transaction. That is called transaction batching. A typical single output transaction takes up 230 bytes, while a two output transaction only takes up 260 bytes, instead of 460 if you were to send them individually.
This is something that many casual commentators overlook when comparing Bitcoin with other payment systems — a Bitcoin transaction can aggregate thousands of individual economic transfers! It’s important to recognize this, as it is the source of a great deal of misunderstanding and mistaken analysis.
We’ve never encountered a common definition of a batched transaction — so for the purposes of this study we define it in the loosest possible sense: a transaction with three or more outputs. Commonly, batching is understood as an activity undertaken primarily by mining pools or exchanges who can trade off immediacy for efficiency. It is rare that a normal bitcoin user would have cause to batch, and indeed most wallets make it difficult to impossible to construct batched transactions. For everyday purposes, normal bitcoiners will likely not go to the additional effort of batching transactions.
We set the threshold at three for simplicity’s sake — a normal unbatched transaction will have one transactional output and one change output — but the typical major batched transaction from an exchange will have dozens if not hundreds of outputs. For this reason we are careful to provide data on various different batch sizes, so we could determine the prevalence of three-output transactions and colossal, 100-output ones.
We find it helpful to think of a Bitcoin transaction as a mail truck full of boxes. Each truck (transaction) contains boxes (outputs), each of contains some number of letters (satoshis). So when you’re looking at transaction count as a measure of the performance and economic throughput of the Bitcoin network, it’s a bit like counting mail trucks to discern how many letters are being sent on a given day, even though the number of letters can vary wildly. The truck analogy also makes it clear why many see Bitcoin as a settlement layer in the future — just as mail trucks aren’t dispatched until they’re full, some envision that the same will ultimately be the case for Bitcoin.

Batching
  1. A timeline
So what actually happened in the last six months? Let’s look at some data. Daily transactions on the Bitcoin network rose steadily until about May 2017, when average fees hit about $4. This precipitated the first collapse in usage. Then began a series of feedback loops over the next six months in which transaction load grew, fees grew to match, and transactions dropped off. This cycle repeated itself five times over the latter half of 2017.

more like this on coinmetrics.io
The solid red line in the above chart is fees in BTC terms (not USD) and the shaded red area is daily transaction count. You can see the cycle of transaction load precipitating higher fees which in turn cause a reduction in usage. It repeats itself five or six times before the detente in spring 2018. The most notable period was the December-January fee crisis, but fees were actually fairly typical in BTC terms — the rising BTC price in USD however meant that USD fees hit extreme figures.
In mid-November when fees hit double digits in USD terms, users began a concerted campaign to convince exchanges to be better stewards of block space. Both Segwit and batching were held up as meaningful approaches to maximize the compression of Bitcoin transactions into the finite block space available. Data on when exchanges began batching is sparse, but we collected information where it was available into a chart summarizing when exchanges began batching.

Batching adoption at selected exchanges
We’re ignoring Segwit adoption by exchanges in this analysis; as far as batching is concerned, the campaign to get exchanges to batch appears to have persuaded Bitfinex, Binance, and Shapeshift to batch. Coinbase/GDAX have stated their intention to begin batching, although they haven’t managed to integrate it yet. As far as we can tell, Gemini hasn’t mentioned batching, although we have some mixed evidence that they may have begun recently. If you know about the status of batching on Gemini or other major exchanges please get in touch.
So some exchanges have been batching all along, and some have never bothered at all. Did the subset of exchanges who flipped the switch materially affect the prevalence of batched transactions? Let’s find out.
  1. Analysis
3.1 How common is batching?
We measured the prevalence of batching in three different ways, by transaction count, by output value and by output count.

The tl;dr.
Batching accounts for roughly 12% of all transactions, 40% of all outputs, and 30–60% of all raw BTC output value. Not bad.
3.2 Have batched transactions become more common over time?
From the chart in 3.1, we can already see a small, but steady uptrend in all three metrics, but we want to dig a little deeper. So we first looked at the relationship of payments (all outputs that actually pay someone, so total outputs minus change outputs) and transactions.

More at transactionfee.info/charts
The first thing that becomes obvious is that the popular narrative — that the drop in transactions was caused by an increase in batching — is not the case; payments dropped by roughly the same proportion as well.
Dividing payment count by transaction count gives us some insight into the relationship between the two.

In our analysis we want to zoom into the time frame between November 2017 and today, and we can see that payments per transactions have actually been rallying, from 1.5 payments per transaction in early 2017 to almost two today.
3.3 What are popular batch sizes?
In this next part, we will look at batch sizes to see which are most popular. To determine which transactions were batched, we downloaded a dataset of all transactions on the Bitcoin network between November 2017 and May 2018from Blockchair.
We picked that period because the fee crisis really got started in mid-November, and with it, the demands for exchanges to batch. So we wanted to capture the effect of exchanges starting to batch. Naturally a bigger sample would have been more instructive, but we were constrained in our resources, so we began with the six month sample.
We grouped transactions into “batched” and “unbatched” groups with batched transactions being those with three or more outputs.

We then divided batched transactions into roughly equal groups on the basis of how much total output in BTC they had accounted for in the six-month period. We didn’t select the batch sizes manually — we picked batch sizes that would split the sample into equal parts on the basis of transaction value. Here’s what we ended up with:

All of the batch buckets have just about the same fraction of total BTC output over the period, but they account for radically different transaction and output counts over the period. Notice that there were only 183,108 “extra large” batches (with 41 or more outputs) in the six-month period, but between them there were 23m outputs and 30m BTC worth of value transmitted.
Note that output value in this context refers to the raw or unadjusted figure — it would have been prohibitively difficult for us to adjust output for change or mixers, so we’re using the “naive” estimate.
Let’s look at how many transactions various batch sizes accounted for in the sample period:


Batched transactions steadily increased relative to unbatched ones, although the biggest fraction is the small batch with between 3 and 5 outputs. The story for output counts is a bit more illuminating. Even though batched transactions are a relatively small fraction of overall transaction count, they contain a meaningful number of overall outputs. Let’s see how it breaks down:


Lastly, let’s look at output value. Here we see that batched transactions represent a significant fraction of value transmitted on Bitcoin.


As we can see, even though batched transactions make up an average of only 12% of all transactions, they move between 30%-60% of all Bitcoins, at peak times even 70%. We think this is quite remarkable. Keep in mind, however that the ‘total output’ figure has not been altered to account for change outputs, mixers, or self-churn; that is, it is the raw and unadjusted figure. The total output value is therefore not an ideal approximation of economic volume on the Bitcoin network.
3.4 Has transaction count become an unreliable measure of Bitcoin’s usage because of batching?
Yes. We strongly encourage any analysts, investors, journalists, and developers to look past mere transaction count from now on. The default measure of Bitcoin’s performance should be “payments per day” rather than transaction count. This also makes Bitcoin more comparable with other UTXO chains. They generally have significantly variable payments-per-transaction ratios, so just using payments standardizes that. (Stay tuned: Coinmetrics will be rolling out tools to facilitate this very soon.)
More generally, we think that the economic value transmitted on the network is its most fundamental characteristic. Both the naive and the adjusted figures deserve to be considered. Adjusting raw output value is still more art than science, and best practices are still being developed. Again, Coinmetrics is actively developing open-source tools to make these adjustments available.
  1. Conclusion
We started by revisiting the past year in Bitcoin and showed that while the mempool was congested, the community started looking for ways to use the blockspace more efficiently. Attention quickly fell on batching, the practice of combining multiple outputs into a single transaction, for heavy users. We showed how batching works on a technical level and when different exchanges started implementing the technique.
Today, around 12% of all transactions on the Bitcoin network are batched, and these account for about 40% of all outputs and between 30–60% of all transactional value. The fact such that a small set of transactions carries so much economic weight makes us hopeful that Bitcoin still has a lot of room to scale on the base layer, especially if usage trends continue.
Lastly, it’s worth noting that the increase in batching on the Bitcoin network may not be entirely due to deliberate action by exchanges, but rather a function of its recessionary behavior in the last few months. Since batching is generally done by large industrial players like exchanges, mixers, payment processors, and mining pools, and unbatched transactions are generally made by normal individuals, the batched/unbatched ratio is also a strong proxy for how much average users are using Bitcoin. Since the collapse in price, it is quite possible that individual usage of Bitcoin decreased while “industrial” usage remained strong. This is speculation, but one explanation for what happened.
Alternatively, the industrial players appear to be taking their role as stewards of the scarce block space more seriously. This is a significant boon to the network, and a nontrivial development in its history. If a culture of parsimony can be encouraged, Bitcoin will be able to compress more data into its block space and everyday users will continue to be able to run nodes for the foreseeable future. We view this as a very positive development. Members of the Bitcoin community that lobbied exchanges to add support for Segwit and batching should be proud of themselves.
  1. Bonus content: UTXO consolidation
Remember that we said that a second way to systematically save transaction fees in the Bitcoin network was to consolidate your UTXOs when fees were low? Looking at the relationship between input count and output count allows us to spot such consolidation phases quite well.

Typically, inputs and outputs move together. When the network is stressed, they decouple. If you look at the above chart carefully, you’ll notice that when transactions are elevated (and block space is at a premium), outputs outpace inputs — look at the gaps in May and December 2017. However, prolonged activity always results in fragmented UTXO sets and wallets full of dust, which need to be consolidated. For this, users often wait until pressure on the network has decreased and fees are lower. Thus, after transactions decrease, inputs become more common than outputs. You can see this clearly in February/March 2017.

Here we’ve taken the ratio of inputs to outputs (which have been smoothed on a trailing 7 day basis). When the ratio is higher, there are more inputs than outputs on that day, and vice versa. You can clearly see the spam attack in summer 2015 in which thousands (possibly millions) of outputs were created and then consolidated. Once the ratio spikes upwards, that’s consolidation. The spike in February 2018 after the six weeks of high fees in December 2017 was the most pronounced sigh of relief in Bitcoin’s history; the largest ever departure from the in/out ratio norm. There were a huge number of UTXOs to be consolidated.
It’s also interesting to note where inputs and outputs cluster. Here we have histograms of transactions with large numbers of inputs or outputs. Unsurprisingly, round numbers are common which shows that exchanges don’t publish a transaction every, say, two minutes, but instead wait for 100 or 200 outputs to queue up and then publish their transaction. Curiously, 200-input transactions were more popular than 100-input transactions in the period.


We ran into more curiosities when researching this piece, but we’ll leave those for another time.
Future work on batching might focus on:
Determining batched transactions as a portion of (adjusted) economic rather than raw volume
Looking at the behavior of specific exchanges with regards to batching
Investigating how much space and fees could be saved if major exchanges were batching transactions
Lastly, we encourage everyone to run their transactions through the service at transactionfee.info to assess the efficiency of their transactions and determine whether exchanges are being good stewards of the block space.
Update 31.05.2018
Antoine Le Calvez has created a series of live-updated charts to track batching and batch sizes, which you can find here.
We’d like to thank 0xB10C for their generous assistance with datasets and advice, the people at Blockchair for providing the core datasets, and David A. Harding for writing the initial piece and answering our questions.
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How the Bitcoin price was changing

How the Bitcoin price was changing
Nowadays, the Bitcoin currency rate perhaps is the most unpredictable thing. All predictions about how BTC price will increase or drop are in some way similar to the weather forecasts. No one can tell what will happen to the coin tomorrow. One of the most important factors that experts rely on is the history of the currency rate over the whole period of BTC existence with its dynamics. It is essential to know what was happening to the coin as this allows you to understand what can happen to it in the future.

2009

The first digital currency – Bitcoin – came to the world on January 9, 2009. In the same month, the creator of Bitcoin mined the first block and he also made the first financial operation in the BTC system.
At the beginning of its history, the Bitcoin price was ridiculously low. The first exchange of BTC to US dollars was made in the summer of 2009 when Martti Malmi received 5.02 USD for his 5050 Bitcoins.
The first official Bitcoin exchange rate to the fiat dollar was established on October 9, 2009. At that time, for 1 dollar you could buy 1 309.03 BTC. Many people now regret that they missed the opportunity to buy Bitcoin for pennies.

2010

In 2010, events in the cryptocurrency market began to develop more intensively. The Bitcoin Market exchange was opened in February 2010, where it was possible to sell the digital coin. In May of this year, the most well-known deal with Bitcoin had happened. The programmer Laszlo Hanyecz bought 2 pizzas for 10,000 BTC. It was the first purchase using cryptocurrency in the real world. He posted a request on the crypto forum saying that he wanted to buy two pizzas. In exchange for that, he offered 10K Bitcoins that back then cost about 40 dollars. And there was a person who agreed to have this deal – it was the 19 years old Jeremy Sturdivant. Jeremy didn’t become a millionaire since then as he spent his coins to travel across the USA.

As for Laszlo, he doesn’t regret about the lost millions. He was mining coins for his pleasure at that time and spent them to different non-significant things.

The two pizzas bought by Laszlo
In July of 2010, BTC price raised to 0.08 dollars. Then in November, the price went up for 50 percent. In general, 2010 was an excellent period for strengthening the position of Bitcoin. The digital currency was almost able to reach the point of one dollar.

2011

BTC overcame the point of 1 dollar only in February of 2011. By early June, the price had grown to 10 dollars. This was a small victory for Bitcoin. Another maximum was set at the point of $31.91. In the middle of June 2011, there was a sharp drop in price: from 31.91 again to 10 dollars.

The year 2011 was full of negative events. One of them happened on June 13, when a user’s electronic wallet was first hacked and 25 thousand coins were stolen from there. In a few days, some geeks hacked MtFox exchange where they got data of sixty thousand users. These events negatively affected the Bitcoin rate. It became clear that in the future the price of digital currency will be determined taking into consideration any events that occur in the market.

2012

In 2012, the exchange rate was ranging from 8 to 12 dollars per 1 BTC. This period was also rich in significant events. One of them is that Bitcoin Central bank began its work. This bank received a license and was even recognized by European regulators.

2013

February 22, 2013, was the day when Bitcoin began to grow again. The price reached the mark of $30. Another increase occurred at the end of January – $31.9. The upward trend continued. March 22 rate was 74.9 dollars per BTC.

On the first day of April, the price went up to $100 and within another nine days, the BTC price grew to 266 dollars. But the growth did not last long. By October it was $109. The possible reason for that is the arrest of an anonymous trading platform Silk Road.

Since November 2013, the price of Bitcoin began to grow anew. By the end of the month, the price exceeded all expectations and raised up to $1,200 per coin. The reason for overcoming the $1,000 point was the BTC support by Zynga game creator. Experts also noted another event that could affect the growth: one of the higher education institutions in Cyprus started accepting the Bitcoin as payment for tuition.

But by the end of the first week of December, the price was 1,000 dollars. In the middle of December 2013, the BTC price dropped to 600 dollars because the China Central Bank prohibited the country’s financial institutions to maintain operations with cryptocurrency.

The Bitcoin price chart in November, 2013

2014

During the year 2014, there happened rather a significant amount of events that had an impact on the Bitcoin volatility. In the first days of January, 1 BTC was equal to 770 dollars. In February it was 700 dollars. Summer 2014 slightly strengthened the reputation of the cryptocurrency.

Many experts think that it was 2014 when BTC strengthened its position in the market, in spite of the fact that Bitcoin price was low – by the end of the year it settled in at around 310 dollars. In 2014 investors began to consider Bitcoin as a potential investment as Bitcoin price predictions seemed quite attractive.

2015

At the beginning of 2015, the BTC price started rising: with 177 dollars in January to 281 dollars to March. The number of people who were trading Bitcoin increased – there were about 160,000 people was buying and selling BTC on exchanges by August 2015. In one period of 2015 the Bitcoin price grew up to 500 dollars, but to the end of 2015, it dropped to about 350 USD.

2016

In 2016, Japan declared Bitcoin as a currency and allowed to use it to pay for goods and services. South Africa was the next who did the same. In April 2016, BTC rate went up and reached $454 per coin. By the end of May, 1 BTC was already worth $600. The reason for the price increase might be the growth of the number of transactions in the Chinese market. The highest price in 2016 was in December – $950 for one Bitcoin.

2017

The year of 2017 was an incredible period in respect of BTC price. It started with $1,000 for 1 coin. Already in June, it was $2,600. By the beginning of September, the price jumped to $5,000 per 1 BTC. On December 17, the Bitcoin price achieved a record and was over 20,000 US dollars.

How did this happen? Here are some reasons that experts point due to the growth of Bitcoin price:

  • In 2017 social media broadcasted a lot of information about Bitcoin and the blockchain system;
  • China resumed cashout of bitcoins from the Chinese cryptocurrency exchanges;
  • In December 2017, the United States officially allowed trading futures for Bitcoin;
  • The number of companies and people who were buying BTC increased as they considered Bitcoin the profitable investment and etc.

However, later in December, the price plummeted from 20 000 dollars to 12 000 dollars. Experts had different reasons including that one of the first cryptocurrency creators sold out all his digital savings and called such investments too risky.

2018

During the first 4 months of 2018, the price of BTC dropped below 7,000 USD. These negative dynamics were quite logical because the rise is always followed by the fall. For the first time since October 2017, the Bitcoin price fell below 6,000 dollars. On November 25, the price of Bitcoin fell even lower – $3,676 per 1 BTC. By mid-December, the bitcoin rate fell by almost 80% to its yearly rate, the price was $3,200.

Nowadays

What can we expect in 2019? What Bitcoin price predictions do crypto experts have? People hope that 2019 will bring new opportunities for Bitcoin and also other cryptocurrencies. Some investors and crypto enthusiasts predict that the BTC price will grow to 40 – 50,000 USD by the end of 2019. One of them, John McAfee, is assured that the price will rise to 1 million dollars by the end of 2020. He even had a bet that he posted in his Twitter saying that he would eat his “love muscle” if his BTC price prediction will not come true.

There may be a number of factors that can influence the BTC price in 2019. They are:

  • Nasdaq, the world’s second largest exchange plans to launch futures for Bitcoin;
  • Coming out of the first crypto-ETP in the world;
  • and many other unpredictable factors that can change the price of Bitcoin.

As it was said before, Bitcoin price predictions are almost like the weather forecast – you never know what price it will have tomorrow. If you think about investing in BTC or any other cryptocurrency you should follow its rate at present time but never forget to compare it to the past. But please, don’t bet to eat any of your body parts 🙂

Feel free to follow our updates and news on Twitter, Facebook, Reddit, Telegram and BitcoinTalk. Read what the customers say about SimpleSwap on Trustpilot. Don’t hesitate to contact us with any questions you may have via [[email protected]](mailto:[email protected]).
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Bitcoin Timelapse MtGox Drop 06.02.2014 to 08.02.2014 Bitcoin CRITICAL (Clickbait) Price Levels Revealed ... A BITCOIN PRICE DROP YOU SHOULD BE READY FOR BITCOIN PRICE COULD HIT $50K ON JUST 1% INSTITUTIONAL ALLOCATION: MESSARI  Buy BTC On Every Block BITCOIN PRICE PREDICTION EXTREMELY BULLISH 2014 Chart STILL Perfect!!!

February 2014: Closing Mt.Gox. In February 2014, Bitcoin was waiting for several troubles at once. It all started on the 7th, when the price of cryptocurrency fell immediately to $100 after several large exchanges were subjected to DDoS attacks. Then, after a heated debate between miners and developers, the subject of which was the block size, the price of cryptocurrency fell again, this time ... Bitcoin has been taking a beating with lawsuits, arrests, regulators, apps taken away and now a withdrawal glitch that sent the price tumbling. Bitcoin’s Horror Story: A BTC Price Drop to $1,000 USD Before Bull Run Starts. by AnTy. March 30, 2019. Home Bitcoin News Bitcoin (BTC) Price. Facebook. Twitter. Telegram. ReddIt. Linkedin . Email. Entrepreneur and cryptocurrency investor Nebraska Gooner recently shared a thread on Twitter where he details Bitcoin’s journey to $1k in the coming days or weeks, that’s yet to be known. The ... Bitcoin has printed gains in February in six out of the last eight years. The 31.5 percent slide seen in 2014 is the biggest February drop on record. Meanwhile, the biggest February gain of 63.9 ... Bitcoin's volatile history in pictures The fall of MtGox. The world's biggest bitcoin exchange, MtGox, filed for bankruptcy in February 2014 after losing almost 750,000 of its customers bitcoins ...

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Bitcoin Timelapse MtGox Drop 06.02.2014 to 08.02.2014

This Bitcoin Price Prediction from December 19, 2014 is EXTREMELY BULLISH and almost 5 year later has been perfect at predicting bitcoin's price. In this video, I will discuss Tuur Demeester's ... #Bitcoin #BTC #Crypto The possibility of a bitcoin dip of another 20% is very real. Do you think it will happen? Comment below and let me know what you think BTC price will do next. Donate: 1piwo7t59rr4SR78CWpYJpt5WM6iCy11Y Bitcoin Timelapse MtGox Drop 06.02.2014 to 08.02.2014 - Bitstamp Price from bitcoinity.org Original files available... According to the announcement, Libertyx, which launched its first Bitcoin ATM in 2014, enables people to buy “Bitcoin on every block” at big chains and smaller merchants. Consumers who ... Donate: 1piwo7t59rr4SR78CWpYJpt5WM6iCy11Y Bitcoin Timelapse Again 29.01.2014 to 03.02.2014 - Bitstamp Price from bitcoinity.org Original files available on r...

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