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Category: Markethive

Should Tax on Bitcoin Be Eliminated? The Case of South Africa

Should Tax on Bitcoin Be Eliminated? The Case of South Africa

    

One of the most widely utilized trading platforms

Bitcoin exchanges in South Africa including Luno, one of the most widely utilized trading platforms in the country, stated that Bitcoin earnings are taxable in South Africa. When trading, the exchange suggested users consult registered tax professionals to ensure that they are compliant with South African regulations.

Should the tax on Bitcoin be eliminated?

Most countries that have fully adopted and regulated Bitcoin such as Japan have eliminated the tax on Bitcoin trading. On April 1, Japan officially declared Bitcoin’s exemption from consumption tax and eliminated the possibility of double taxation on trading. Recently, the Australian government also exempted Bitcoin trading from goods and services tax (GST). “The Government has released a consultation paper on changing the GST treatment of digital currencies. This change will ensure that consumers are no longer ‘double taxed’ when using digital currencies to buy goods and services already subject to GST,” read the 2016 — 17 Budget Report of the Australian government.

In South Africa, however, Bitcoin trading is subjected to general principles of South African tax law. The South African Revenue Service stated that transactions or speculation in Bitcoin are subject to tax and should be taxed accordingly. The government institution further emphasized that it is the responsibility of both citizens and residents of South Africa to report relevant details to the South African Revenue Service. Former BitX Product Design Director and Blockchain investor Simon Dingle also stated that Bitcoin trading in South Africa could trigger a capital gains event and encouraged traders and investors to consult tax professionals before trading on South African exchanges.

“It may trigger a capital gains event, or could qualify as income for active traders. All assets are treated equally in terms of tax,” said Dingle. More to that, income received in Bitcoin and other digital currencies are taxed as conventional income tax. It is still unknown whether double taxation applies and, as a result, if users are subject to both income tax and capital gains tax. Additionally, Luno Head of Growth Werner van Rooyen stated that various factors could impact taxation on Bitcoin transactions and trading depending on the situation of users.

Rooyen stated:

”There are various factors that could impact taxes an individual owes to the tax authorities, The short answer is that all income is taxable in South Africa and it is the responsibility of individuals to remain tax compliant.”

Regulations and taxation policies

The Australian Treasury changed its regulations and taxation policies on Bitcoin after seeing a sharp decline in interest in Bitcoin and other digital currencies in the country. Exchanges that used to operate in the country have left Australia to other Bitcoin-friendly regions such as Singapore and Hong Kong. For that reason, the Australian Treasury removed the double taxation of Bitcoin.

As its report read:

“For digital currency, the current treatment under the GST means that consumers are ‘double taxed’ when using digital currency to purchase anything already subject to GST. The Government recognises that this treatment may be preventing the use of digital currencies and hindering their further development.”

Aggressive taxation policies on Bitcoin could also result in a delayed andlimited growth for the South African exchange market and Bitcoin industry. The South African government must consider the effect of double taxation and clarify the taxation policies that apply to Bitcoin and digital currencies.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk Markethive Founding Member

Cryptocurrency Trading Volume Hits $4.3 Bln, Nears Stock Exchange Volume

Cryptocurrency Trading Volume Hits $4.3 Bln, Nears Stock Exchange Volume

    

The cryptocurrency trading volume hit $4.3 bln. Bitcoin

On May 25, the cryptocurrency trading volume hit $4.3 bln. Bitcoin, Ethereum, Ripple, Ethereum Classic, Litecoin and NEM drove the cryptocurrency trading volume to new all-time highs. Bitcoin developer and entrepreneur Jimmy Song compared the cryptocurrency trading volume to the exchange volume of major stock exchanges such as NASDAQ. Although the cryptocurrency market’s trading volume is only a fraction of major stock exchanges such as NASDAQ, it is nearing the exchange volume of smaller stock exchanges such as Thailand and Australian stock exchanges.

In order for the cryptocurrency market to near the trading volumes of major stock exchanges, particularly the 16 stock exchanges in the $1 Trillion Dollar Club, the cryptocurrency market will need to achieve a multi-trillion dollar market cap. Currently, the market cap of the cryptocurrency market is $71 bln.

Cryptocurrency investments

Investors and traders are investing in the cryptocurrency market for a variety of reasons. Some have invested in Ethereum because of its successful partnership strategy demonstrated by the Enterprise Ethereum Alliance. Others have invested in Ripple, the third largest crypto asset in the cryptocurrency market, due to its partnerships with the Japan Bank Consortium and leading financial institutions.

A large number of both casual and institutional investors have invested in Bitcoin as a safe haven asset to avoid potential economic uncertainty and financial instability. Some investment firms including Fidelity Investments are actively investigating the potential of Bitcoin and Ethereum by mining the two digital currencies and testing two-layer solutions such as Lightning and Bitcoin-based micropayments solution. If the demand toward cryptocurrencies continue to increase and investors begin to perceive cryptocurrencies as alternatives to existing financial systems, the cryptocurrency market could surpass the growth, market cap and trading volumes of major stock exchanges in the future.

A phenomenal method of raising funds

Furthermore, similar to the initial public offerings (IPOs) of public companies, Blockchain startups and commercial companies such as Kik have been launching initial coin offerings (ICOs) to sell tokens in a transparent and decentralized manner. Although analysts have raised concerns over the legality of ICOs and potential response from the US Securities and Exchange Commission, ICO, in theory, is a phenomenal method of raising funds for startups without intermediaries. More importantly, ICOs enable anyone within the community to participate in the investment, providing opportunities for small-scale investors.

Startups that raise or complete successful ICOs often have their tokens listed on cryptocurrency market data providers such as CoinMarketcap and on exchanges. Most recently, Gnosis, a Blockchain-based prediction market platform, raised a multi-million dollar funding round in an ICO at a $300 mln valuation. The Gnosis token was listed on major US-based Bitcoin exchange Kraken and within a month, it became the seventeenth largest crypto asset in the market. In a sense, the cryptocurrency market and the concept of ICO represents similar qualities and characteristics of stock exchanges — a decentralized, transparent and autonomous stock exchange.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk Markethive Founding Member

South Korea is Becoming Bitcoin and Ethereum Powerhouse

South Korea is Becoming Bitcoin and Ethereum Powerhouse

    

South Korea is becoming a Bitcoin and Ethereum powerhouse

in terms of trading volumes, liquidity and activity. Over the past few months, South Korea’s three largest digital currency exchanges Bithumb, Korbit and Coinone have added support for Ethereum traders by integrating Ether. In a relatively short period of time, South Korea has become the largest Ethereum exchange market with a $335 mln daily trading volume and 38 percent market share. In fact, the ETH/KRW pair processes more trades than the ETH/BTC pair, which used to account for over 50 percent of all Ethereum trading.

The largest Bitcoin exchange markets in the world

South Korea has also become one of the largest Bitcoin exchange markets in the world. Although South Korea is currently the fourth largest Bitcoin exchange market behind the US, China and Japan, a month ago, its trading volume and market share was larger than China and Japan and secured its spot as the second-largest Bitcoin exchange market for awhile. South Korean investors within the cryptocurrency market are very easily moved and influenced by the media. Ethereum’s recent Enterprise Ethereum Alliance deals with large conglomerates such as Toyota and JPMorgan have further validated the value of Ethereum to more local investors and have shifted the trend from Bitcoin to Ethereum.

Eyes set on altcoin

More importantly, because Bitcoin has become a conservative asset amongst other cryptocurrencies, investors in South Korea have started to look into altcoins such as Ethereum and Ripple that are supported by local exchanges. Most South Korean exchanges are funded by multi-billion dollar corporations within the country. Korbit, South Korea’s second-largest exchange, is invested by SK Telecom, the largest telecommunications company in the country. Therefore, when exchanges add support for cryptocurrencies such as Ethereum and Ripple, immediately, investors dive into altcoins. Particularly, investors that believe they missed Bitcoin’s rally invest in altcoins for large short and mid-term gains.

The demand toward Bitcoin has increased to the point where there always exists a huge arbitrage opportunity for overseas traders. Bitcoin is being traded in South Korea with a premium price of $2,800. That is a 21 percent premium over the global average price and other major markets such as the US. While it is still possible to purchase Bitcoin outside of South Korea with other options such as credit cards to avoid premium rates, it is difficult to trade large amounts of Bitcoin without being flagged by anti-money laundering systems. If the current growth rate of the South Korean Bitcoin and Ethereum exchange markets can be sustained over the next few months, South Korea could become a powerhouse for both the Bitcoin and Ethereum markets.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk Markethive Founding Member

Nevada Becomes First US State to Block Blockchain Taxes

On June 5, the Nevada State Legislature became the first US state to approve a bill which will block local government entities from taxing Blockchain transactions.

This is great news because Thomas Prendergast and I have a trading platform to double your Bitcoin every 40-50 days without recruiting anyone. CLICK HERE We are recruiting top industry leaders right now. Find out how we grew by 110 people in the first day.

Nevada is often recognized as the “silver state” due to its significant silver resources. It is also famous for being the home to Las Vegas, the city of entertainment. A big chunk of its revenue comes from casinos, and money is valuable in this location. For the first time, the state of Nevadahas taken a significant step in paving the way for the continued progress of Bitcoin.

On March 30, Republican Senator Ben Kieckhefer introduced Senate Bill 398 intended to protect Blockchain transactions under the state’s Uniform Electronic Transactions Act.

The bill provides an accurate definition of the Blockchain, stating that it is:

“An electronic record of transactions or other data which is:

  1. Uniformly ordered;
  2. redundantly maintained or processed by one or more computers or machines to guarantee the consistency or non-repudiation of the recorded transactions or other data;
  3. Validated by using cryptography.”

Bitcoin transactions are tax-free

Senate Bill 398, the Blockchain-friendly bill, was introduced by Kieckhefer last March and was approved unanimously by the Senate in April. The move was made right before the moving of the Nevada Assembly in May, whereby it was amended, approved and then turned back to the Senate who confirmed the amendments.

It was then sent to Governor Brian Sandoval whereby it was approved. In regards to the approval, Kieckhefer states:

“The potential uses of Blockchain are limitless, and I’m confident Nevada’s entrepreneurs will find ways to use this technology to innovate and drive our economy forward.”

He added: “I can’t wait to see what comes next.”

Following in the steps of Arizona

This is the second Blockchain-friendly bill that has been enacted into law within the past few days. On May 29, Arizona Governor Doug Ducey signed a bill which recognized the legality of Blockchain’s signatures and smart contracts.

Domino effect

Bitcoin influences and has a domino effect upon every state and company, and this law aims to promote both Nevada and the Blockchain community.

Let us hope that Nevada continues to become a decentralized Blockchain-friendly stateso that the amendments may focus on promoting honesty, integrity, validity and immutability — all of which Blockchain is known for.

One by one, US states are gearing towards the direction of Bitcoin. The digital currency that started small is now instructing the world and providing a path for how the future will grow financially.

The world is adjusting to Bitcoin, something never experienced before in history, and a world centered around cryptocurrencies is the future that we should look forward to.

Transparency and a better economy await with this law validating the legality of Bitcoin.

Chris Corey

CMO 

Markethive Inc

Contributor: Joshua Althauser

https://cointelegraph.com/news/nevada-becomes-first-us-state-to-block-blockchain-taxes#

Alan Zibluk Markethive Founding Member

Is Bitcoin or Other CryptoCurrency a Good Investment

Is Bitcoin or Other CryptoCurrency a Good Investment

Is Bitcoin or Other CryptoCurrency a Good Investment

Despite all denials of the techies, the Bitcoin continues to fly under the pressure of marketing that makes it a form of Russian roulette that benefits those who know the manipulation. Since March 26, the Bitcoin has increased from $ 973 to $ 2,795. A real explosion of prices which can only be explained by fraudulent maneuvers. It went from $ 16 billion to $ 43 billion.

But behind this surge, there are formidable manipulators who have means that are the exchanges of bitcoins of which several leaders are in prison. The founder of the world’s largest depository based in Bitcoins, now based in Zug, Switzerland, predicts that the value of a Bitcoin will surpass the million dollar mark in 10 years, taking by surprise the whole assembly and even the most Optimists in the sector. Some see the replacement of gold. We are in full delirium.

On several occasions, these dramatic increases came from the conversion of dirty money into Bitcoin. We do not know what causes these mood swings that fall quickly. Do they pose a fundamental question: Beyond the technology behind the object, from where comes the value of $ 32 billion?

No regulation of false rumors or manipulations

There is a lot of talk about the Bitcoin right now, as well as a few other crypto-currencies, but are they really good investments? Recently I read research which describes why Bitcoin are a good investment for the future. They also provide detailed analysis and data to showcase their study. So I am exploring based on that and my personal opinion on crypto-currencies.

I will divide this question into three points:

1. Are crypto-currencies really an investment?

2. What currency crypto choose?

3.Are crypto-currencies really an investment?

Nowadays, virtually everything is called an “investment”. In the case of crypto-currencies, trading (trading) and investment are again confused, even by financial professionals.

 

An investment is when you buy an asset that produces something, and that by extension creates income.

For example, if you buy a tractor and lease it, it will allow someone to dig to then put the foundation of a house, pull farm machinery, and much more. In exchange for the productivity of your assets, you receive an income.

The question is, therefore: does the crypto-currency produce something?

The main added value of crypto-money is that it can make anonymous transactions, so it increases economic activity (albeit generally illegal).

That said, it produces nothing tangible for you because its overall productivity is drowned in the pool of all transactions.

Your only hope is therefore that its overall productivity in the form of a currency function is growing so that you can “freak out” your crypto-currency.

Basically, crypto-currency does not produce income for you, and your only option to make money is that its demand increases.

When a profit is generated not by production but by the difference between the purchase price and the selling price, it is called trading and not an investment.

What does it actually mean that it is trading and not an investment?

Trading is speculation and it’s not complicated, 95% of people lose at this activity.

Investing is a much safer way to get rich. You simply need to be aware of what you are doing with your money, and not speculate in thinking that you are investing.

Which crypto-currency to choose?

Bitcoin? Zcash and Zcoin? SafeCoin? Syscoin?

Admitting that you understand that you are speculating, the only crypto-currency I would negotiate personally is the Bitcoin, for two reasons:

 

Reason # 1: Everyone knows the Bitcoin

This point seems banal and simplistic. However, it should not be forgotten that the value of crypto-currencies is based on people’s trust. Indeed they are “fiat currencies”, like the Canadian dollar, the US dollar, and virtually all currencies in the world.

People have a tremendous confidence in the Canadian dollar and particularly the US dollar, which is the world’s reserve currency. What about crypto-currencies?

How do people trust you, the Bitcoin, the Zcoin, or the Syscoin? Obviously, people have more confidence in the Bitcoin, and one can easily assume that it will only go by increasing over time.

However, there is always resistance, and people do not have enough confidence in the Bitcoin to move away from the Canadian dollar or the US dollar.

In particular, the critical point or the Bitcoin could explode in price is when people will have enough confidence to use another function of the currency: the reservoir of value.

When people have confidence in Bitcoin to use it as saving, as an entity where they can retain the value of their work, then everything will change.

But how could the Bitcoin reach this level? How to develop this trust? These questions lead me to the second reason.

 

Reason # 2: The Bitcoin is the only crypto-currency that has a real chance

The Bitcoin is the only crypto-currency that has a real chance of what? To become an official currency, endorsed by the government and the financial system.

A strong and unshakeable confidence in the Bitcoin can only exist if governments and the financial system give it their approval.

In fact, it seems that in Canada the government is increasingly ready to incorporate the Bitcoin into daily transactions. This is not cast in concrete, and the future is still vague at the legislative level.

One of the barriers to official currency status for Bitcoin is that the government cannot legalize a private currency, which would limit its ability to tax transactions.

Can another crypto-currency based on the blockchain possibly be adopted rather than the Bitcoin? Yes, but precisely, there lies the whole aspect of speculation: we must try to predict the future.

In summary, invest in crypto-currencies or not?

Honestly, the majority of people do not even have $ 2,000 in an emergency, according to an article I read, so I do not see myself buying Bitcoins.

In this situation, I would buy stocks, bonds, gold, and real estate well before buying Bitcoins.

So unless I have a full RRSP and a TFSA, stuffed with income-producing assets, I cannot justify buying crypto-currencies.

I understand the desire to hit a home run with the Bitcoin, the desire to make 10 times his initial bet. This may be suitable for some people, but I cannot endorse this strategy because it makes a lot more losers than winners.

The strategy to get rich that works for me and in general is to get rich in the long run, walking by walk, so surely find myself at the top of the stairs.

 

Aashish Sharma

 

The article above is quite interesting but many people do not realise you do not need to to purchase a wholw bitcoin, there are ways and means to earn bits for free completing surveys, or by investing in Trade Coin Club

David Ogden
Entrepreneur

 

Alan Zibluk Markethive Founding Member

Billy Draper’s Investment Tips — Cryptocurrencies, ICOs, Bubbles: CT Exclusive

Billy Draper’s Investment Tips — Cryptocurrencies, ICOs,
Bubbles: CT Exclusive

    

The Draper family is well-known to the Bitcoin community.

Tim Draper is one of the most active investors in the Bitcoin ecosystem: back in 2014, he bought 30,000 BTC as part of the government auction and up until now he is said to keep purchasing Bitcoin and to own Ether. Besides, he used his reserve of Bitcoin to fund the startups of Boost VC (with 300 BTC each), his son Adam Draper’s Virtual Reality, Blockchain and Bitcoin venture capital firm.

However, Tim has recently announced his readiness to take one step further in his relationship with the crypto world and participate in ICO — of a company called Tezos, a “new Blockchain platform launched by a husband and wife team with extensive Wall Street and in hedge fund backgrounds.” Not so long ago Boost VC also followed into his footsteps and wrote in a blog post that they were willing to invest directly in ICOs. In an exclusive interview to the Cointelegraph at Arctic15 in Helsinki, Billy notes that for the Drapers ICO is a new opportunity. “In the last month and a half, we have seen a lot of ICOs,” explains Billy Draper, Tim’s son and currently a Partner at Draper Associates. “Since Gnosis, in the last month we have seen six or seven opportunities either asking us to participate, or to market, or do something, but we’ve been still sorting it out.”

Addressing to the crypto community, Billy notes:

“You have changed the whole dynamic of funding. You have taken the best parts of Kickstarter, the best parts of Venture Capital, the best parts of tech community, and you said: Hey, we are going to release a new token, this token is going to be used specifically for making predictions, and all the engineers who are interested in that come buy those tokens, and then you can increase the value of those tokens by building applications on our token.”

Billy Draper is the one responsible for seed-stage investments in companies such as Robinhood, Laurel & Wolf, Tempo Automation and LawTrades. He is in charge of sourcing and driving investments across all sectors, with some slant towards financial technologies, marketplaces and logistics. Prior to DA, he worked in Operations at Facebook and Product Design at ApartmentList. He was named to the 2016 Forbes '30 Under 30' List for Venture Capital. “And because you bought that application, the price or the value of that currency goes up,” he continues. “And there is something so beautiful about that — that is why we are excited about crypto in general and now we are actually starting to think about ICOs.”

Is it going to be Bitcoin and Ethereum forever?

Billy admits that cryptocurrencies are probably relatively small and it’s not the focal point of the fund yet even though they do look for deals in crypto — Bitcoin, Blockchain and ‘whatever the next token is’. “We know that there will be a sort of cryptocurrency revolution, it has already started, this is no longer a science project,” he says. “This is now huge multibillion dollar industry if you take a look at the the market cap of Bitcoin, Ethereum, and now Ethereum is worth a few billion dollars, and people are building token on top of Ethereum.” However, the question that comes — Is this going to be driven, is this sort of the revolution in crypto going to be driven by 25 different cryptocurrencies or a hundred different currencies? Or is it going to be the winner takes it all?

“The reasons why new tokens pop up is because they find problems with the old ones or perhaps not problems, but opportunities to build a currency more focused on solving one problem — governance, or smart contracts, or anonymity,” Billy continues. “Another thing I like about other currencies popping up is that now Bitcoin is the gold standard to buy into the other cryptocurrencies.” The Drapers do believe that there is something behind Bitcoin and Blockchain tech in general. On the one hand, they have inherited connections and wealth from their father and grandfather. But on the other hand, they have been raised with “anything-is-possible” mentality, the Silicon Valley’s spirit of individualism and relentless optimism.

Billy shares his optimism about cryptocurrencies:

“It is not because cryptocurrency is a cool new thing — it is because of there is an incentive structure, it’s because you are taking some of the smartest engineers in the world. The coins that fail are going to be those that don’t have real world applications, the ones that are going to be successful are the ones that fulfill the promise.”

For venture funds, it would be better if cryptocurrencies and ICOs were regulated because that would make investors feel safer. Right now there is no legal ground, so you can’t ask for your money back. “We would definitely be worried about the bubble, but there is also a fear of missing out, and you have to believe in the promise,” Billy notes. “Not necessarily in the whole market of crypto but you have to believe in the promise just like people now believe in the promise of Bitcoin and Ethereum. So yes we would be worried about the bubble but just like everyone. But I don’t think we could live our lives worrying about that.”

How to invest in ICOs and cryptocurrencies, what to consider

In the early 1980s, Tim Draper was exploring the opportunities of Silicon Valley — he had an engineering degree from Stanford and a diploma from Harvard Business School and so he was trying to figure out what to do next. He started his own firm, which later became the founding investor in Baidu and Tesla Motors and backed the likes of Hotmail and Skype. They say it is the ‘Draper luck’.

“If you talk to all the great venture capitalists in the history, all of their failures have been failures to act,” explains Billy. “It is not like I invested into something and It went to zero. Because you can invest in something that goes to zero, but then you can invest in something that goes to thousands, so one X downside, thousand X upside.” He points out that we could always talk ourselves out the investment, just like we are going to talk ourselves out of an ICO, or investing money directly into cryptocurrency, or a platform built around the cryptocurrency, but the potential opportunity we would miss is what would drive us crazy.

Right now ICOs are small projects with sometimes not very experienced teams who are doing mostly marketing, raising up millions of dollars without having a product. You can get the interest really high in the ICO: you do the offering, you limit the number of tokens, you create a supply on the marketplace and then you could drive up the price because of who is involved and who is building but eventually the apps have to be built. What is important is that the promise has to be fulfilled.

“When it comes to ICOs, the criteria would be if you are an investor interested it is not hard to reach out to these people, if they have a white paper, they usually have contact, if they want questions, they want to be challenged,” says Billy. “You need to believe in the team and the team should be aware of that and the team shouldn’t try to hide behind wherever and more people do that. This is very encouraging, they publish a whitepaper saying hey contact us, this is how we are going to do this, how we are going to implement this, this is the background that we have.”

Billy also recommends investors to diversify and participate in several ICOs to make sure their crypto portfolio has some exposure to some other currencies. They should understand how the market is going to function, that this crypto could go to zero, it could fail, it could be dead, or there is a bigger risk, which we don’t typically have to deal with which is it could be stolen. “What I would do is probably work with the crypto expert, who I trust and ask him if he would consult me and make sure I do it in the right way,” he says. “You look at what applications could be developed for it, so why does this exist, what is the specific use for this that can’t be done elsewhere and if those applications were to be built, what is the market size of that, based on the market cap, then you would approach it the way we approach startups.”

Billy concludes by saying that team and real world application are the two criteria for a success, the real world applications that people need to connect. Previously, in the Cointelegraph we have covered several examples of how real world economy can benefit from the crypto economy. The latest case of such type of a project is Primalbase, which claims to transform traditional office rental into a new-generation community-based ecosystem where one can share, sell or rent out high-quality office spaces using Ethereum and Waves-based digital tokens. In other words, it’s distributed workspace for the tech community in the manner of WeWork but in crypto tokens.

Billy Draper says about it:

“That’s cool, they found a real world application, and that’s what we want to see — we don’t want to see more coins in the world. That is a game-changing thinking, the same with real estate. Renting out these tokens? That is how you start the real revolution, that’s how things will go from Bitcoin sort of still crypto community which is getting bigger.”

We end our conversation with Billy with asking for a general advice about cryptocurrency investment. And he tells us that the best way to start with is to learn about cryptocurrencies that you think are the most interesting, the specific ones. Then you should start trading them, in some small way — you don’t have to start with a huge million dollar investment in a cryptocurrency. You should start to feel and understand the volatility of the market, to understand what drives the market and how you can play into that.

He concludes:

“I would suggest just like with anything — make sure you know what you are getting into, so there are no surprises, and if the token goes to zero, that’s the risk to take. And on the upside make sure you are investing in a token you believe in. If you are trying to pick winners, make sure you pick winners that you feel very comfortable about what they are going to develop.The key is user education, just make sure you understand what you get into, there is a certain risk.”

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk Markethive Founding Member

Altcoin Gulden Set To Implement PoW² In July: Leading Developer

 

Altcoin Gulden Set To Implement
PoW² In July:
Leading Developer

    

Gulden is set to implement Proof of Work 2.0

also known as PoW² latest by July this year. The digital cryptocurrency that has tagged itself as user-driven insists this new technology will tremendously enhance its security and provide economic incentives for holders. In a chat with Cointelegraph, Gulden Lead Dev, Malcolm Macleod who is the mastermind of PoW², says what the technology is going to do to advance it to the crypto space.

Limitations

He intimated that his outfit has taken a long hard look at various usability issues that stand in the way of their current goals. He also identified several limitations of current Blockchain systems that repeatedly stick out as key usability issues that need to be solved. According to Macleod, they include issues like erratic block times, slow transaction confirmations, and the risk of double spends among others.

He says:

"After looking at these problems holistically, we have come up with a solution that not only solves them but also drastically improves our overall Blockchain security and has other positive effects as well, and this is the system we call PoW²."

Malcolm disclosed that the system works not only by building on top of the existing PoW system but adding onto it a concept we call 'witnessing' which involves a deterministic random winner signing each block as it comes in. "In order to participate as a witness users must lock coins in a special address for a period of time (of their choosing) between one month and three years," he added.

Solution

Macleod, the Southern African Based Blockchain Developer, explained that PoW² brings a massive increase in Blockchain security. It is immune to a standard greater than 50 percent attack that would be possible on PoW, with the equivalent attack on PoW² requiring not only 61 percent of hash power but also 61 percent of all coins and still has a lower chance of success.

He explains:

"At the same time, PoW² remains immune to attacks like grinding that regular PoS coins would suffer from. There are less confirms required by users for their transactions. Instead of the standard seven confirms required for Bitcoin (or more for other coins) the security properties of PoW² allow for users to be sure of consensus much faster, and they need to wait only for one or two confirmations.”

Dichotomy

When Cointelegraph inquires about the difference between PoW² and the previous version, Malcolm steered out that it solves the 'empty block' issue which is very important for scalability, and the transaction backlogs with Bitcoin network for instance with miners mining empty blocks, which is really bad for overall transaction capacity. He is of the opinion that PoW² solves this issue for 99.9 percent of cases.

"PoW² helps to keep the PoW miners on the network less centralized, and completely removes from them the ability to censor transactions, something that is quite possibly going to be a big issue for PoW coins going forward," he said. “With Bitcoin, we now see a situation where miners get a disproportionate say in decisions (like SegWit activation). With PoW² those who actually hold currency for the long term get more say in forks and therefore the control is placed in the hands of people who actually have a vested interest in the currencies long term health and not just short-term profits."

Challenges

In response to what limitations and Challenges PoW² has, Jason van Heerden, a Gulden Team member, emphasized it is when it comes to making it possible for secure one-confirmation transactions which will lead to zero-confirmation transactions in the future but the solution to it will also be out soon. "No real limitations besides the code base becoming more complex to manage," Jason stressed. Curiously, on whether you need to permanently keep your wallet open to act as a Witness, Jason said yes. The wallet can remain locked/encrypted during the process so it remains secure. It is likely that cloud and/or dedicated hardware based solutions will become available to assist people with this," he revealed.

Jason also disclosed the concept has been worked on for over a year now already, with the whitepaper and internal feasibility tests ongoing. Moreover, he explained the release will include many other bug fixes and codebase improvements besides PoW² so it is important that proper testing is done. However, it is their believe it is going to be out and operating on the Gulden network by July.

Expert opinion on PoW²

JuicyG of Coinchat.Club thinks Gulden seems to be using a hybrid PoW/PoS and calling it PoW² isn't really accurate. In his evaluation, other projects like Ethereum or Ethereum Classic are working towards adding a hybrid PoW/PoS solution.

He argues:

"As a matter of truth, 80 percent of their block reward seems to be going to miners, while 20 percent is reserved for wallet staking. People have to run the wallets on their computers for it to work. They didn't set up a system yet that would allow one to use a VPS to host the node, which is not ideal if you care about 24/7 uptime. Few people will let their computers on 27/4. This is something they've admitted themselves in their FAQ." Cointelegraph asked JuicyG it appears that is some of the solutions PoW² provides, but he was adamant. "It doesn't strike me as very innovative, to be honest, and also, they mention zero confirmation transactions but this is something that doesn't exist yet and will come in Version 2.0.," he differed.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk Markethive Founding Member

Top Altcoins Surge As Bitcoin Price Crosses $2400 in Sign of Recovery

Top Altcoins Surge As Bitcoin Price Crosses $2400 in Sign of Recovery

    

The pioneer cryptocurrency Bitcoin crossed the $2,400 line

At 11:00 GMT+2 on Thursday, the pioneer cryptocurrency Bitcoin crossed the $2,400 line by appreciating 10.22 percent and recording a market price of $2,419. The aftermath of last weekend's panic has seen the price going up and down like a pendulum. But this morning robust growth has returned to the cryptocurrency ecosystem. There are talks of Chinese exchanges resuming withdrawals and if that is the case then it is a good omen for the industry. For almost four months now, Chinese exchanges have suspended Bitcoin and Litecoin withdrawals. This was supposed to last for just a month when the directive came from the People's Bank of China (PBoC) in February.

Top achievers

Moreover, the top 10 on CoinMarketCap is green with the only exception of Stratis, with the Blockchain application going down 9.14 percent. Ripple seems to be making amends with a grand 39.45 percent hike, being the biggest achiever at the elite altcoins club for the day. New Economic Movement (NEM) is not dim-witty either by attaining 20.93 percent. Dash is not relaxing after losing some points and it is up to an admirable 18.17 percentage score. Moreso, Monero and Litecoin appreciated more than 11 percent. Bytecoin brightens the bottom of the top 10 with a 10.97 percent growth rate. It is amiable to see Ethereum and his younger brother, Ethereum Classic managing the least gains of the day. They went up modest 1.78 and 0.07 percent respectively.

A bountiful weekend ahead?

There are talks about back to the winning ways in the community. For instance, there is a lot of optimism on various platforms especially Bitcoin Powpow. Are we heading for a weekend of bounty harvest with prices going up and cryptos bloating their market capitalization? Friday will tell if the current gains are sustained and improved upon. For now, the news is refreshing and just the opposite of what we went through last week. Let us hope the industry will end the week on a very good note.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk Markethive Founding Member

Tax Authorities In Pakistan Zero In At Bitcoin Traders

Tax Authorities In Pakistan Zero
In At Bitcoin Traders

    

Tax authorities across the globe have set their sights on Bitcoin traders.

The latest to join the set is the FBR (Federal Board of Revenue) in Pakistan.

Bitcoin in Pakistan

While Asian countries like Japan, China and South Korea have been in the news for people taking a fancy to Bitcoin, adoption in Pakistan has been low key. The first Bitcoin exchange in Pakistan, Urdubit, was established in 2014. There is tremendous potential for Bitcoin in Pakistan, with the country receiving remittances of $20 bln every year. Pakistan also has a vibrant freelance economy, with estimated revenue of $1 bln. Wider adoption of Bitcoin can bring efficiencies in both remittances and payment for online freelancing.

Windfall profits

The recent rapid increase in Bitcoin price has meant that Bitcoin investors were able to reap windfall profits. Not all of them declare this income, resulting in scrutiny from tax authorities. In the US, the IRS served a John Doe summons to Coinbase, asking it to hand over details of US customer transactions. The IRS had sought details of customer transactions between 2013 to 2015, much before the current bull rally.

In Pakistan, the volume of Bitcoin transactions has recently increased, leading to the intelligence department of the FBR launching an investigation. The objectives of the FBR are two-fold — detect cases of tax evasion as well as money laundering. According to tax officials, major traders of Bitcoin have not reported their business profits to tax authorities and hence a summons has been issued.

Cracking down

The State Bank of Pakistan does not recognize cryptocurrencies, including Bitcoin. Cryptocurrencies are traded as commodities and the government has not shown any indication that it would either regulate or impede cryptocurrency transactions. The focus of the current government action seems to be restricted to cracking down on cases of money laundering and tax evasion. The government will find it tough to restrict its people from purchasing a deflationary currency when the average rate of inflation in Pakistan during the last 60 years is 7.8 percent.

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk Markethive Founding Member

Top Altcoins Bounce Back, Ethereum Price Gains Big Time

Top Altcoins Bounce Back, Ethereum Price Gains Big Time

    

The despair that gripped the crypto market

last week appears to be over. Now the markets are bouncing back with tokens making impressive gains.

Altcoin rollercoaster

Since Saturday ctryptocurrency markets have been in scarlet red with almost every altcoin taking a whack. Sunday seems to be the most horrible day with all top 20 dipping at an outrageous manner.

Occupying the bottom of the top 10 altcoins, Microfinance Blockchain, Stellar Lumen was smitten so hard by the brief depression it tripped down with an unimaginable 44.24 percent. NEM who was one of the major beneficiaries of the rollercoaster wasn't spared as it also took a dip of 40.87 percentage points. The least depreciation was 24.20 percent which was accounted for by the market leader — Bitcoin. On Monday morning the story was no different. Earlier on it was only Golem that was in green at the top 10 but it also somersaulted along the line. The market, however, started showing some recovering late afternoon.

Green is back

Now the markets are bouncing back with tokens making impressive gains. As early as 8:00 GMT+2 on Tuesday, all top 10 altcoins were appreciating with remarkable speed. Generally, it is leafy with a few downs here and there on CoinMarketcap. Ether is having a field day with an accumulation of a 25.48 percent skyward increase. Its market price is close to the $200 mark once again. At the moment it is the biggest swell on top 10. Well, magnificently, Stratis vaulted 22.73 percent over Stellar Lumen and Golem to be countered among the elites of cryptocurrencies. As a matter of fact, this crypto has been knocking on the doors of top 10 for more than a month now.

Deserving a mention here is ETC which also grew by 19.87 percent. The Decentralized Smart Contract platform cannot be left out if we are talking about some of the entities who kept most of their gains during last week's ride.

Prior to the price rally, Monero was tanking gradually, however, it up its game and managed a 70 percent bulge during the price harvest. On Tuesday morning as cryptos are resurrecting from the brief scare, it is the fourth most appreciated currency with 17.03 percent. Bitcoin went up by 7.22 percentage points and the least increase was 8.05. The trend looks more heartwarming than the previous days. The other digital currencies in the elites standing scored between six and 12 percent.

It wasn't a bubble

On many interactive crypto platforms, the popular question that has been floating around is whether the bubble is over or not. But engrossingly, JuicyG of Coinchat.Club beg to differ. The crypto expert is of the opinion that what happened was not a bubble and as an element of fact, there is nothing like that in the recent circumstance.

He says:

"I think it was just a weekend break and there was a banking holiday on Friday so you could call it an extended weekend. No fiat hit the exchanges on the weekend and there was another banking holiday on Monday in the US and other places."

Intriguingly enough, he indicated that there will be much more money flowing into the cryptocurrency market. When Cointelegraph asked of his conviction, he accentuated that cryptocurrencies are gaining traction in the mainstream.

"Take ETC for example — there was that recent New York conference and ETC was the star of the show. Lots of big money guys got acquainted with ETC for the first time and they didn't even get the chance to buy yet."

Chuck Reynolds
Contributor
Please click either Link to Learn more about – Bitcoin.

Alan Zibluk Markethive Founding Member