Happy Groundhog’s Day and post Super Bowl withdrawal day!
Bunch of accumulated Tid Bits for you today, so I just wanted to write a quick endorsement of the WSJ guys’ The Age of Cryptocurrency, which I finished today. I just got back from moderating a Q&A with authors Mike Casey and Paul Vigna at the NY Bitcoin Center on the book and topic, and have to say this is the book I’d have aspired to write on the subject given the time, a better attention span and a more polished writing ability. This is a must-read for enthusiasts who want to polish their cocktail party pitches, and a must-give to any potential bitcoin convert.
Casey and Vigna stick to their WSJ style in the book, and what they lacks in flair, they more than make up for in substance. That’s not to say it is dull, but even if they won’t make an HBO series out of the book, each chapter is comprehensive, clear, concise and actually readable. The book is built for multiple editions, too. Even if a given chapter needs an update in the future, the way they walk the reader through the evolution of money, bitcoin’s “creation myth”, the complexities of mining, crypto economics and geopolitics, and the potential for blockchain 1.0 and 2.0 alike, is going to make The Age of Cryptocurrency the go-to book on bitcoin for a long time in most serious circles.
This is a rational, level-headed breakdown of why blockchain tech is so exciting, and Casey and Vigna make the case for the blockchain, the currency and its derivatives without sounding like shills or homers. In other words, it’s a compelling pitch for bitcoin from two experienced journos who aren’t easily excitable. Perhaps the best mainstream and objective pitch for bitcoin that we’re going to get. So enjoy it.
There might be a couple of other well-written, character-driven stories about bitcoin that come out in the coming months, but when it comes to a bitcoin reference book for executives and financiers, every other author is just playing for second. Go buy it.
(No, they aren’t paying me to pump the book.)
For Entrepreneurs
The MIT E-Lab is a well established (20+ year) program that helps startups by matching them with MIT & Harvard business school students for a semester. The E-Lab is now looking for cryptocurrency related startups at various stages, so apply if you think this could help your efforts. (You don’t need to be local, but a c-level exec has to be in Cambridge frequently.) To apply, or for more info on E-Lab visit http://elab.mit.edu/.
Events
Inside Bitcoins Conference and Expo - Singapore (Jan. 27-28), Berlin (Mar. 3-4), and New York (Apr. 15-17)
Inside Bitcoins is the largest bitcoin and blockchain technology focused event series worldwide. At each event you’ll hear about the latest challenges, trends, and opportunities in the industry from experts including Steve Beauregard of GoCoin.com, Marco Santori of Pillsbury Winthrop Shaw Pittman, Brian Kelly of CNBC’s Fast Money, Barry Silbert of Digital Currency Group, Marco Santori of Pillsbury Winthrop Shaw Pittman, and more. Plus, TBI Daily readers get 10% off the Singapore, Berlin, and New York events with code TBIDAILY.
Jobs, Jobs, Jobs
Bitnet, San Francisco, Belfast, London (VC-backed)
-Leading digital commerce platform & former Visa team.
-Open positions: Engineering (Customer Success, Lead UI, Product, DevOps), Sales Director (EMEA), Sales Engineer (San Francisco)
-Check out Bitnet (https://bitnet.io/careers.html) and email jobs@bitnet.io
Coinbase, San Francisco (VC-backed)
-Largest “universal services” bitcoin company.
-Open positions: Security Engineer, Software Engineer (2-3 years mobile product development), Regulatory Compliance Investigator, (1 year conducting SAR investigations)
-Check out Coinbase (https://www.coinbase.com/careers/)
BitGo, Palo Alto (VC-backed)
-The leading Bitcoin multi-sig security company
-Open positions: Back-end / Front-End / iOS / Security Engineers, UX Designer
-Check out BitGo (www.bitgoinc.com/jobs) and email jobs@bitgo.com
Bolt, San Francisco (VC-backed)
-Stealth startup focused on consumer applications of Bitcoin.
-Open positions: Security Engineer, Ruby Engineer, UI/UX Designer, Executive Assistant.
-Check out Bolt (bolt.com) and email jobs@bolt.com.
Elliptic, London (VC-backed)
-Vault and enterprise digital currency services.
-Open positions: Data Scientists and Front-end developers.
-Learn more and apply at elliptic.workable.com
Today’s Tid Bits
LinkedIn Founder Talks Bitcoin’s Future at San Francisco Conference
http://www.coindesk.com/linkedin-founder-talks-bitcoins-future-san-francisco-conference/
Reid Hoffman, LinkedIn founder and Greylock Partners investor, spoke about bitcoin with Xapo CEO Wences Casares at an event in San Francisco last week. Hoffman spoke about bitcoin’s network effects, framing bitcoin as one of the best currencies in the world, although cautioning, “we’re not giving investment advice.” Back in July, Hoffman’s Greylock Partners contributed in a $40m investment round for Casares’s Xapo.
Bonafide Raises $850k to Build Reputation System for Bitcoin
http://www.coindesk.com/bonafide-raises-850k-build-reputation-system-bitcoin/
Bonafide, a small startup, has raised $850,000 to build a reputation system for the bitcoin industry. Bonafide works by gathering information from social networks and the bitcoin network to provide bitcoin users a reputation score. The company plans to establish reputations for bitcoin companies, including wallets, exchanges and consumer-facing services. Bonafide wants to bring bitcoin to the mainstream by helping users overcome their fears of the digital currency’s pseudonymous nature.
BitPay Proposes Zero-Confirmation Instant Payments Solution
http://cointelegraph.com/news/113409/bitpay-proposes-zero-confirmation-instant-payments-solution
Bitpay is proposing a zero confirmation solution for faster Bitcoin transactions, which involves an open-standard “impulse” system based on multiple payment channels. The system is designed to be “as trustless as possible,” and is described as “Instant Payments using the Bitcoin protocol,” according to Bitpay. The impulse system is designed to make bitcoin transactions for over-the-counter as fast as credit card transactions.
Bank Suspends Polish Bitocin Exchange’s Accounts
http://www.coindesk.com/bank-suspends-polish-bitcoin-exchanges-accounts/
BitMarket.pl, a Polish bitcoin exchange, has had its bank accounts suspended by Bank BPH. BPH is stating the closure is due to outstanding debt and lack of credentials. Michael Pleban, founder of BitMarket.pl believes the real reason was because of a query filed by the local district attorney’s office regarding stolen funds. BitMarket.pl is actively seeking a new banking partner, after its accounts were suspended on January 26th.
Coinbase Support Added for Google Now
http://www.coindesk.com/google-now-coinbase-support/
Google Now, Google’s mobile on-demand information service, has added support for Coinbase. Coinbase will now notify Google Now users when there are fluctuations in the price of bitcoin. Google Now becomes the latest Google service that supports some bitcoin-related functionality.
Spondoolies-Tech and Genesis Team Up for Cloud Mining Service
http://www.coindesk.com/spondoolies-tech-genesis-team-new-cloud-mining-service/
Spondoolies-Tech, a bitcoin mining hardware firm, is partnering with Bermuda-based Genesis Mining on a new cloud-mining offering. Spondoolies plans on providing the hardware to back the virtual contracts sold, while Genesis will operate the machines. Given the current environment in the bitcoin mining space, a partnership is smart move to fulfill customer demand.
Bitcoins Are Easier To Track Than You Think
http://time.com/3689359/bitcoins-track-anonymous/
Sam Frizell of Time argues that despite bitcoin’s anonymous nature it is, in actuality, easy to track. His evidence? The Silk Road Trial. Federal agents were able to trace 3,760 bitcoin transactions over the course of year to the servers involved in the Silk Road investigation. FBI agent, Ilhwan Yum testified that he was able to track down the bitcoins through Ulbricht’s (a co-founder of Silk Road) computer. Yum found Ulbricht’s bitcoin address, which he then searched for on the blockchain, and was able to track down all of Ulbricht’s transactions.
The Bootstrapper’s Guide to Bitcoin Remittances
http://techcrunch.com/2015/01/30/the-bootstrappers-guide-to-bitcoin-remittances/
Luis Buenaventura, a co-founder at Rebit.ph, a bitcoin remittance startup operated in the Philippines, takes a look at the numbers, the context, the recipe, the mechanics, the law, and ultimately the dream of bitcoin remittances. He highlights the international $430 billion international remittance industry and the potential bitcoin could realistically change the industry. He admits, that at their core, all bitcoin remittance startups are brokerages, operating as on-ramps for exchanges. Ultimately, the dream is to accumulate $42 billion in global savings through cheaper, more efficient, remittance services.
What is Bitcoin, Exactly?
http://www.smithsonianmag.com/innovation/what-is-bitcoin-exactly-180954033/?no-ist
Smithsonian.com takes a look at Paul Vigna and Michael Casey’s new book, The Age of Cruptocurrency. The two financial reporters the WSJ recently published the book, which explains how the digital currency came to be, what it is, and the potential it has to transform the world of finance. In an interview the two explain bitcoin it basic terms, how one would acquire bitcoin; it’s potential, and ultimately, their book.
Bitcoin Libertarians Now Desperately Need the Government’s Help
http://qz.com/335539/bitcoin-is-saved-from-irrelevance-by-good-old-fashioned-regulation/
“Bitcoin’s ideological foe is becoming its saving grace.” Shelly Banjo of Quartz discusses the government’s role in legitimatizing bitcoin. Bitcoin Libertarians praise the currency because of its lack of attachment to any centralized system, but as the currency seeks institutional investors, legitimate banking partners, and drifts towards the mainstream, some sort of government regulation is appearing to be necessary. As Banjo points outs when creating a new currency, sometimes it pays to play by the rules.
Why Apple Pay and Dollars Are Killing Bitcoin
http://www.forbes.com/sites/greatspeculations/2015/01/29/why-apple-pay-and-dollars-are-killing-bitcoin/
Ross Gerber of Forbes takes a rather uninformed jab at bitcoin, labeling it as a failing, speculative commodity comparing it to the tulip bulb speculations. He claims that bitcoin peaked, and its price will more than likely not recover. Gerber also argues that bitcoin’s lax regulation, no centralized banking control, and no transaction fees are the aspects of the currency that will lead to its demise. He goes on to mention that bitcoin’s merchant utility is not effective, and systems such as Apple Pay will quickly trump bitcoin, convenience wise.
Research: Over $11 Million Lost in Bitcoin Scams Since 2011
http://www.coindesk.com/research-11-million-lost-bitcoin-scams-since-2009/
Over the last four years, bitcoin scams have netted swindlers at least $11m. 13,000 uninformed victims handed over their money unknowingly in 42 different scams. Marie Casek, who researches computer security at Southern Methodist University (SMU), and Tyler Moore, an assistant professor in computer science at SMU wrote a paper titled There’s No Free Lunch, Even Using Bitcoin: Tracking the Popularity and Profits of Virtual Currency Scam revealing these figures.
Reddit Lets Go Cryptocurrency Engineer Ryan X Charles
http://www.coindesk.com/reddit-lets-go-cryptocurrency-engineer-ryan-x-charles/
Ryan X Charles has been let go by Reddit as the social platform’s cryptocurrency engineer. Charles, who this week demonstrated his proof of concept for peer-to-peer bitcoin payments on the site, announced the news in a Reddit post, saying “I have complete confidence in the new leadership, but cryptocurrency is no longer in their plans.” Charled added that he was, “fairly confident cryptocurrency will return to Reddit in the coming years.”
Princeton Announces Bitcoin Course
http://newsbtc.com/2015/01/30/princeton-announces-bitcoin-course/
Starting in April 2015, Princeton University will start a teaching of a course called “TC-Tech: Bitcoin and Cryptocurrency Technologies.” The class will be taught online, via webinars, and is not listed as being an official Princeton course.
Coinbase’s Bitcoin Exchange Is Operating Without Licenses So Far
http://dealbook.nytimes.com/2015/01/28/coinbase-a-bitcoin-exchange-is-operating-without-licenses-so-far/
Benjamin M. Lawsky, the superintendent of New York’s Department of Financial Services, said that Coinbase does not have the licenses necessary to operate as a bitcoin exchange in the state. Matthew Anderson, a spokesman for Mr. Lawsky, said they would be working with companies to approve licensing, but, “we have not yet issued any licenses to virtual currency firms.” In addition, California’s top financial regulators said, “California consumers should be aware Coinbase Exchange is not regulated or licensed by the state.”
Bill Gates: Digital Currency Can Help the Poor, But Not Bitcoin
http://gizmodo.com/bill-gates-digital-currency-can-help-the-poor-but-not-1682346647
Yesterday, Bill Gates participated in a Reddit AMA, where he mentioned his high hopes for digital currency as an important banking tool for the poor. However, he believes that Bitcoin specifically, isn’t one of those currencies, at least not in its current form. Gates believes that bitcoin is “an exciting new technology,” but not a very good tool to make banking easier in emerging markets because of it’s volatility and it’s anonymity.
Huobi Doubles Down on International Market With Fee Cuts
https://www.coindesk.com/huobi-doubles-down-international-market-fee-cuts/
Huobi, one of China’s largest bitcoin exchanges, is prioritizing international growth in 2015. BitYes, Huobi’s USD trading platform, will have free USD deposits until March 31st. BitYes will also implement a temporary “market-taker” trading fee structure, rewarding those who set limit orders. In addition, the company has removed fees all together on litecoin trading until June 30th.
LocalBitcoins User Funds Stolen After Chat Client Hack
https://www.coindesk.com/localbitcoins-user-funds-stolen-chat-client-hack/
LocalBitcoins, a peer-to-peer bitcoin marketplace, suffered a hack this week that resulted in a loss of customer funds and a distribution of malware. An estimated 17 BTC was taken from customer wallets. Affected users will be granted refunds after taking steps to address security vulnerabilities, according to LocalBitcoins.
Tembusy Raises $887,000; TRUST a Step Closer
http://newsbtc.com/2015/01/29/tembusu-raises-s1-2mm-trust-step-closer/
Tembusu Systems, known for developing bitcoin ATMs, has announced a refocusing of the company on “next-generation block chain technology.” The terminology is vague, but many suspect the company will focus on organizational authorities that are trying to enter the digital currency space, but are concerned about the dangers of hacking. Regardless, the company raises 1.2 million Singapore dollars ($887,000) in a closed financing round for their pivot.
Venture Capitalist Draper Bets $400,000 More on Bitcoin Revival
http://www.bloomberg.com/news/articles/2015-01-27/venture-capitalist-draper-bets-400-000-more-on-bitcoin-revival
Tim Draper, a billionaire venture capitalist, recently bet about $400,000 that the digital currency’s price will rebound from around $200. Bitcoin’s price dipped by more than 30 percent in two days this month to below $200, but has since then recovered to around $250. Draper also bought about 32,000 bitcoins at a government auction last year (when bitcoin was worth around $600), which he has since used to invest in various bitcoin startups.
Ex-Goldman Trader Readies New Bitcoin Exchange
http://www.tradersmagazine.com/news/ecns_and_exchanges/ex-goldman-trader-readies-new-bitcoin-exchange-113397-1.html
Paul Choi, a former Goldman Sachs trader is readying LedgerX, a new federally regulated exchanged designed to trade virtual currency. LedgerX will be a fully regulated Bitcoin derivatives exchange and clearinghouse. If approved by the CFTC, LedgerX would be the first federally regulated Bitcoin options platform and clearinghouse to list and clear fully collateralized, physically settled Bitcoin options for the institutional market. LedgerX is backed by Google Ventures and LightSpeed Ventures.
Texas Bitcoin Mining Company CoinTerra Files Bankruptcy
http://newsbtc.com/2015/01/27/cointerra-files-bankruptcy/
CoinTerra, a struggling bitcoin mining company, has filed chapter 7 bankruptcy in a likely move to avoid any additional payouts. CoinTerra has amassed massive debts following a $5 million lawsuit from C7 Data Centers and an inability to pay customers. The bankruptcy was filed on January 24th, and the company stated that it would be unable to pay several unsecured investors. A creditor meeting is scheduled for February 27th.
Citi Digital Chief: Bitcoin’s Economics Are Flawed
http://www.coindesk.com/citi-strategy-chief-bitcoins-economics-flawed/
Greg Baxter, Citi’s head of digital strategy, believes Bitcoin isn’t mature enough for mass adoption and its economics are inherently flawed. Baxter pointed to bitcoin miners dropping out of the network as evidence that the digital currency’s economics failed to “stack up,” Baxter was building on a earlier point that technology innovators should focus their efforts on the “core” of existing financial systems, rather than revolutionizing it.
Japanese Bitcoin Exchange BitFlyer Draws a Further $1.1M Led By Silbert
http://newsbtc.com/2015/01/28/bitflyer-draws-1-1m-led-silbert-total-investment-now-2-93m/
BitFlyer, a Japanese based bitcoin marketplace, has secured $1.6 million in funding from domestic venture capitalists led by Barry Silbert’s Bitcoin Opportunity Corp, but with the majority of the investment coming from Japanese investors. BitFlyer will be attempting to fill the void left by the collapse of Mt. Gox. To date the company has raised $2.93M.
Over 70 Bitcoin Scams Shut Down By New York Law Enforcement
http://www.coindesk.com/70-bitcoin-scams-shut-new-york-law-enforcement/
73 sites promising unrealistically high returns on bitcoin investments were taken offline on January 16th by the New York County District Attorney’s office. Charges on the site range from securities fraud, intent to commit fraud, as well as larceny charges. All of the sites originated in Southeast Asia.
Manhattan DA: We’re Watching Regulated Exchanges With ‘Immense Interest’
http://www.coindesk.com/manhattan-da-watching-regulated-exchanges-immense-interest/
Cyrus R Vance Jr., Manhattan’s district attorney, has indicated that his department intends to watch developments in the bitcoin exchange sector with “immense interest.” Vance is a long-time advocate for more stringent regulations in the bitcoin space, as he believes the digital currency makes criminal conduct “too easy and too untraceable.” Vance’s remarks came during his keynote address at the Association of Certified Anti-Money Laundering Specialists’ (ACAMS) AML Risk Management Conference on Monday.
Bitcoin 2.0 Startup Colu Attracts $2.5 Million Seed Round
http://blogs.wsj.com/venturecapital/2015/01/27/bitcoin-2-0-startup-colu-attracts-2-5-million-seed-round/
Colu a Tel Aviv based bitcoin 2.0 startup is building out software that would allow consumers to securely buy and store digital tokens, which could serve as tickets to events, or act as digital keys unlocking physical objects, such as hotel doors. Colu has raised $2.5 million in a seed round led by Aleph, an Israeli venture firm, and Spark Capital. Bitcoin Opportunity Corp and BoxGroup also participated in the funding round. Colu’s tokens are based on the Colored Coins protocol, which was developed by Colu’s co-founder Amos Meiri. Colu’s app is currently in beta and the team is soon opening up its API to be used by other apps.
British Money Exchange Startup Worth $1 billion
http://news.sky.com/story/1415207/british-money-exchange-startup-worth-1bn
TransferWise, a peer-to-peer money transfer service, has secured $58m (€39m) of investment led by venture capital firm Andreessen Horowitz. The British based startup uses peer-to-peer technology, created by Skype and Paypal’s developers, to eliminate bank fees. As of now, TransferWise has raised a total of $91m (£61m) and is currently valued at $1bn.
The Cryptocurrency That Dare Not Speak Its Name
http://www.americanbanker.com/bankthink/the-cryptocurrency-that-dare-not-speak-its-name-1072352-1.html
On Monday the Federal Reserve released a white paper on improving the payments systems, where the Fed referred to cryptocurrencies as “Digital Value Transfer Vehicles,” which were defined as “decentralized digital stores of value than can be exchanged.” The report never defined these “transfer vehicles” as bitcoins, but it’s hard to imagine the paper referring to anything else. When Fed staffers were asked why the paper made no official mention of Bitcoin, they responded by saying they were planning on monitoring development within the digital currency, and as the technology matures develop a regulation strategy.
Winklevoss twins: Bitcoin Will Explode Beyond $1 trillion
http://money.cnn.com/2015/01/27/investing/bitcoin-winklevoss-twins-gold/
Following a presentation at ETF.com’s Inside ETFs Conference, where the Winklevoss twins presented their proposed bitcoin ETF, the two sat down with CNNMoney to talk bitcoin. The Winklevoss twins believe the bitcoin market’s cap could easily skyrocket to $1 trillion, despite it currently sitting at less than $4 billion. Currently, the Winklevoss twins are awaiting regulatory approval for their Bitcoin ETF, which would trade securities based off of bitcoin. The twins believe the fund would appeal to gold bugs because Bitcoin, like gold, can be used as a hedge against inflation.
UK Bank Closes Safello Accounts 6 Weeks After Entering Partnership
http://www.coindesk.com/uk-bank-closes-safello-accounts-6-weeks-entering-partnership/
Six weeks ago Safello, a Swedish-based bitcoin exchange, announced “Faster Payments” deposits for UK customers due to a strong partnership with is banking partner. Today, the banking partner withdrew its services and is planning on closing Safello’s accounts. The company said, “there was no base for the decision to shut our accounts down.” Safello plans to continue to support international wire transfers for British pounds, and will reactivate its “Faster Payments” once a new banking partner has been established.
ANX Acquires CoinMKT
http://newsbtc.com/2015/01/27/hong-kong-based-bitcoin-exchange-anx-goes-us-markets-coinmkt-acquisition/
ANX, a Hong Kong based bitcoin exchange, has partnered with CoinMKT, a California based bitcoin exchange. ANX’s COO said the acquisition would strengthen their presence in the Americas, where there are also looking to secure local banking partners.
Free Bitcoin Airdrop Drive by McGill University Cryptocurrency Club
http://newsbtc.com/2015/01/27/free-bitcoin-airdrop-drive-mcgill-university-cryptocurrency-club/
The Bitcoin Embassy and the McGill Cryptocurrency Club from Montreal are collaborating to form “The McGill University Bitcoin Airdrop,” a project that is aimed to promote Bitcoin adoption and usage on campus. The McGill Cryptocurrency Club is planning to give 30mBTC each to 600 students, which is worth around $10 per wallet, in the form of a paper wallet sealed with bitcoin inside and a public key printed on the outside.
Old Pirate Bay to Reward Contributors with $100,000 in Bitcoin
http://www.coindesk.com/old-pirate-bay-reward-contributors-100000-bitcoin/
Old Pirate Bay, a popular file-sharing site, is set to hand out $100,000 worth of rewards in bitcoin to people who assist with the site’s development. The digital currency will be divided amongst developers, moderators and contributors based upon their performance. Old Pirate Bay was launched following the takedown of the original Pirate Bay in early December.
Colorado Bitcoin Trader Arrested, Could Face 5 Years in Prison
http://cointelegraph.com/news/113372/colorado-bitcoin-trader-arrested-could-face-5-years-in-prison
Burton Wagner, bitcoin trader has been arrested and may face up to 5 five years in prison for his money transmitting activities dating back to 2012. Wagner is being accused by US Federal Prosecutors of operating without a money-transmitting license. Wagner is also being accused of participating in the Pirate Pass-Through scam operated by the now-infamous Bitcoin Savings and Trust.
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