カテゴリーアーカイブ: Adoption & community

Video Interview: Ricardo Pérez-Marco on Lightning Network Routing and Bitcoin

In this exclusive video interview, mathematics professor and researcher Ricardo Pérez-Marco talks about his work on Lightning Network routing proposals and his journey in Bitcoin.

The post Video Interview: Ricardo Pérez-Marco on Lightning Network Routing and Bitcoin appeared first on Bitcoin Magazine.

Video Interview: Ricardo Pérez-Marco on Lightning Network Routing and Bitcoin

In this exclusive video interview, mathematics professor and researcher Ricardo Pérez-Marco talks about his work on Lightning Network routing proposals and his journey in Bitcoin.

The post Video Interview: Ricardo Pérez-Marco on Lightning Network Routing and Bitcoin appeared first on Bitcoin Magazine.

LocalBitcoins Denies Service to Iranian Users


The popular peer-to-peer bitcoin trading network LocalBitcoins has shut down all trading operations for Iranian users.

LocalBitcoins’ website offers a variety of pages for users of different nations and, as of May 24, 2019, the Iranian page displays a message that “LocalBitcoins is currently not available in your selected region,” in English only. In an official correspondence regarding the update, a representative of LocalBitcoins confirmed that Iranians can no longer access the service.

“If you have an account already, you will be able to withdraw your bitcoins, but you will not be able to use the platform for trading,” the representative said of Iranian users.

LocalBitcoins is not the first peer-to-peer trading network to block Iran in this fashion. Major companies such as Coinbase and Binance have also begun rejecting Iranian customers on the basis of their nationality within the past year. Ziya Sadr, an Iranian bitcoiner, told Bitcoin Magazine that the move “shouldn’t come as a surprise.”

The reason for these companies’ blocks seems clear: the new wave of sanctions that the United States is levying against Iran and companies that conduct business within the country. Since the Trump administration unilaterally violated an agreement with the Iranian government regarding the nonproliferation of nuclear weapons in 2018, relations between the two countries have been deteriorating.

Iranian citizens have shown interest in the borderless nature of Bitcoin for just this reason, among the other natural advantages of the technology. In April, the country’s first Bitcoin ATM made a splash at a Tehran technology exhibition. Camera crews interviewed several passersby and the topic of using Bitcoin to circumvent unjust sanctions came up repeatedly.

Bitcoin is fundamentally a platform designed to connect users worldwide, regardless of the restrictions imposed on free exchange by various nations. After receiving the Lightning Torch from Bitcoin Magazine via Welsh bitcoiner Bitgeiniog in March, Sadr called Bitcoin “a safe haven.”

“Laws and regulations may force a business to take decisions against their will,” Sadr told Bitcoin Magazine regarding the LocalBitcoins ban. “This will force a business like LocalBitcoins to lose users and revenue, but the market operates and there will always be different business that will serve us.”

Indeed, the space as a whole is not abandoning the country of some 80 million people. Also on May 24, Hodl Hodl announced that it was offering full support for operations in the country. More than just keeping the site open, Hodl Hodl also announced that it would provide Farsi language support (unlike LocalBitcoins’ English-only error message), a discounted exchange fee and a Telegram group specific for Iranian users to establish contact with each other. Bisq, another decentralized bitcoin exchange, has also added Farsi support and offers Iranian bitcoiners a viable alternative.

Ironically, even in the wake of LocalBitcoins’ exit from the country, Iranians “actually now have more and better options for p2p exchanges than before,” Sadr said.

This article originally appeared on Bitcoin Magazine.

Liquid Network Expands With New Memberships and Integrations


Blockstream’s Liquid Network has expanded to include 14 new members. With these additions, Liquid’s client base now boasts 35 institutions.

The company also announced that Liquid is now available on Bitfinex and RenrenBit, a crypto finance app. Essentially, it means that users of these platforms can now access Liquid Bitcoin withdrawals and deposits.

In addition, the news heralds some of the network’s future projects, including the launch of Tether (USDT) and Stably (USDS), two dollar-backed stablecoins on the network.

In a statement, Bitfinex Chief Technical Officer Paolo Ardoino claimed that the expansion “makes a lot of sense” so that institutions can issue digital assets under a single blockchain platform.

He added, “It reduces the integration burden for an exchange like ourselves, and traders can manage all their assets from a single wallet application. We’re excited to be finally active on the Liquid Network and looking forward to seeing how it develops.”

Samson Mow, Blockstream’s chief strategy officer, also commented on the move, adding that Liquid’s features, including quick settlements, will help speed up asset transfers for both safekeeping and trading purposes.

He added, “Transaction details on Liquid are hidden by default thanks to Liquid’s privacy technology, so traders no longer have to worry about front-running on large trades either.”

Developed by Blockstream, the Liquid Network is a federated sidechain on Bitcoin’s blockchain which functions as a settlement and payment processing network for investors and institutions across the global crypto market.

The network, which was launched in 2018, allows its users to transfer funds to various destination without having to establish channels ahead of time.

Liquid is Blockstream’s answer to the Lightning Network. However, while Lightning works for micropayments, Liquid is described by its creators as a tool for facilitating “fast and reliable high-value transfers.” The platform promises quick and secure asset transfers to members within the network, as well as the prospect of conducting transactions over a system that doesn’t fail.

This article originally appeared on Bitcoin Magazine.

Bitfinex Releases White Paper for LEO Token Sale

bitfinex (1).jpg

Bitfinex is forging forward despite its ongoing row with the authorities, and it’s looking for investors to support its efforts.

Today, May 8, 2019, iFinex, the operator and parent company of the popular cryptocurrency exchange, released a private token sale white paper, putting to rest rumors of its Initial Exchange Offering (IEO). Bitfinex is launching the token sale in a bid to compensate clients whose funds disappeared as part of the $850 million loss the exchange incurred at the hand of its payment processor Crypto Capital. Funds raised will also go toward refunding users affected by an August 2016 hack of 119,756 bitcoin.

In addition, “[p]roceeds may be used for working capital and general business purposes, including capital expenditures, operating expenses,” as well as “repayment of indebtedness and other recapitalization activities.”

According to the white paper, iFinex will issue up to 1 billion LEO tokens, with each token pegged to controversial stablecoin tether (USDT), a currency which shares personnel and ownership structures with iFinex.

The exchange will kick off with a private token sale, while a public sale might come after, if it fails to sell off the total amount of available tokens. These tokens will give holders discounts and rebates on trading, deposit and withdrawal fees and other benefits based on the portion of LEO owned; for example, Bitfinex will permit anyone holding greater than 50 million LEO to withdraw $2 million without any added fees.

iFinex will purchase and burn LEO from holders each month at a minimum rate of 27 percent of its gross revenue (consisting most notably of Bitfinex and Tether, this includes revenue from all of iFinex’s subsidiaries excluding Ethfinex).

“iFinex and its subsidiaries will use an amount equal to 95% of the recovered net funds from Crypto Capital (described above) to redeem and burn a corresponding amount of outstanding LEO tokens. Net recoveries will be calculated by iFinex in good faith and will be net of legal costs, operational and recovery costs, governmental charges, and reserves for contingent costs,” the white paper states.

The exchange also revealed that it is working toward the launch of a derivatives trading in the coming months, and it will be using tether as collateral as well.

“From its expected June 2019 launch, qualified Bitfinex account holders will be able to trade a new hedging product through a derivatives wallet. The product will have USDT-based collateral (unavailable in the rest of the market), up to 100x leverage and isolated margin for individualized risk level,” the document confirms.

Bitfinex is in the middle of a legal battle, after it was accused of fraud by the New York Attorney General for tapping into Tether’s reserves to cover up $850 million in losses in customer funds to its primary payment processor Crypto Capital. The New York Attorney General has requested that the Supreme Court of New York freeze the $900 million line of revolving credit Bitfinex established with Tether to cover the lost funds, while Bitfinex continues to rebut the legal action and move for the court to dismiss the attorney general’s requests.

This article originally appeared on Bitcoin Magazine.

BlueWallet Brings Lightning Network to Apple Smartwatch With New App


Popular Bitcoin and Lightning Network wallet BlueWallet has released a smartwatch-compatible version of their wallet app, the first attempt to bring Lightning support to the Apple hardware.

The developers announced this new app on Twitter, briefly describing some of its functionality. Giving users the same utility as BlueWallet’s mobile iteration, the new app packs plenty of use on such a small device.

I’m living in the Future 😎

Takes 5-10 seconds to prepare a lightning invoice on my watch

Immensely cool work from @bluewalletio @nvcoelho pic.twitter.com/4ftOVL7dKD

— JP [ ₿ ⚡️] (@jpthor__) May 6, 2019

Originally only a wallet for bitcoin itself, BlueWallet expanded into full functionality for the Lightning Network in late December 2018. Since then, it has been a popular option for mobile wallet access, with versions for both Android and iOS. Seeing as Android does not currently manufacture a smartwatch, however, this Lightning app is currently only available on the Apple Watch.

In addition to also clarifying that the watch app can be noncustodial, the team from BlueWallet has also described a more in-depth list of features that the app currently provides. Alongside features such as full encryption, the ability to use multiple wallets, support for 20 languages and more, BlueWallet’s app seems to have many of the same features that any other conventional wallet platform would hold. Ideally, this will serve as a litmus test for the possibility of greater smartwatch adoption in the crypto space.

In a bid to improve transaction speed and mitigate on-chain fees, the Lightning Network has been heralded as a game changer for Bitcoin’s technical development. Allowing users to send microtransactions over channels funded by both senders and receivers, it has the potential to greatly alleviate the problems of scalability and latency issues that have plagued the world of bitcoin.

Already a variety of prominent companies have begun adopting the Lightning Network in addition to new companies springing up to fill niches in the space. Bitrefill, for example, launched functionality for Lightning in January 2019 and made further improvements in April. Zap released a point-of-ale smartphone app to enable vendors to accept payments using the Lightning Network, and Twitter wallet and miscrotipping service Tippin.me has seen substantial growth since its launch in December 2018. Lightning Network development company, Lightning Labs, released the alpha of its own long-awaited desktop app in April as well.

This article originally appeared on Bitcoin Magazine.

U.S. Citizens Can Now Accept Their Federal or State Tax Refund in Bitcoin


Federal tax season just passed in the United States, but if you’re one to leave responsibility to the wayside and had to apply for an extension, that might just pay off.

It’ll give you the opportunity to become one of the inaugural users of a new joint-endeavor by crypto payment processor BitPay and tax services company Refundo. The new program called CoinRT gives Refundo users the opportunity to take their federal and state income tax refunds in bitcoin.

“We believe that as more and more people understand the benefits of Bitcoin, they’ll gravitate to it. With the option to set aside all or part of their refund in a seamless manner, it allows those on the sidelines to jump right in,” Refundo CEO Roger Chinchilla told Bitcoin Magazine.

Tax filers using Refundo’s system who opt into the program will include a routing and account number linked to BitPay’s Payouts. Once the refund hits this account, BitPay converts the cash to sats and sends it to whatever wallet address the user provided upon sign-up (this sign-up, as one would expect, includes KYC).

A press release shared with Bitcoin Magazine highlights that the move is in line with Refundo’s wider focus on lower income and poorly banked populations. For this purpose, bitcoin offers a low friction refund option for those who don’t have access to reliable banking, Refundo CEO Roger Chinchilla claims.

“We’re always looking at low-cost and convenient methods to disburse our clients’ refunds. As bitcoin adoption steadily grows, Refundo believes we can serve as an innovative payout process for our clients. Refundo’s focus has been on serving the underbanked, which is at the core of bitcoin’s rise, so it’s a natural fit. More than that, it gives taxpayers an incentive to save. Instead of splurging when your refund arrives (this is typically the case in low-income communities), CoinRT can act as a saving mechanism and ensure taxpayers are more fiscally responsible,” he told Bitcoin Magazine.

Head of Business Solutions at BitPay Rolf Haag told us that the partnership answers “customer demand in multiple verticals for Bitcoin Payouts. It also signals that the “global marketplace” for payouts in bitcoin is growing.

“Recipients want choice, especially for high cost alternatives like bank wire receipts or pre-loaded debit cards. Recipients are tired of paying to receive, and senders want to make their recipients happier without incurring additional costs,” he concluded.

At any rate, the partnership adds bulk to a growing trend of bitcoin’s burgeoning role in taxation. Canadian town Innisfil made history early this year as the first North American municipality to permit its citizens to pay local taxes in bitcoin. For Canada’s southern neighbor, Ohio opened up a bitcoin payment option to its corporations at the tail end 2018, and, in May of the same year, Seminole County Florida enabled the option for things like property tax.

This article originally appeared on Bitcoin Magazine.

Vidi, Vici, Satoshi: The Lightning Torch Has Reached Its Final Destination

Lightning Torch Finish

The Lightning Torch, a Lightning Network payment that has been forwarded to bitcoiners around the world via Twitter, has run its course and reached its end in the charitable hands of Bitcoin Venezuela.

It’s grown a lot since we last covered it in February. In fact, the term “Torch” doesn’t seem to do it justice anymore. At this point, it could rightly be called a bonfire.

Admittedly, it’d be impossible to pass a bonfire around the world (a Torch sounds much more feasible), but the Lightning Torch doesn’t care much for the impossible or implausible. Ten years ago, the prospect of passing a digital payment to every continent shy of Antarctica would have been unthinkable. Even less thinkable: this payment chain would be passed uninterrupted (well, mostly uninterrupted, save two kinks) over 275 times with hardly anyone’s own opportunism getting the better of it.

It’s intersected with economically sanctioned countries like Iran, fallen into the hands of a Finnish model, been highly publicized after Twitter CEO Jack Dorsey took part and become a gleaming example of bitcoin’s resilience as a currency that has no regard for borders, edicts or politics.

As the Torch enters its final stretch, it has cleared a series of significant hurdles; from escaping greedy hands to transcending economic sanctions, the Torch has more than lived up to the hopes of its Prometheus.

“I never expected it to go anywhere,” Hodlonaut, the Torch’s creator, told Bitcoin Magazine. “It was just a fun little thing that I did; it’s not like I sat and planned this out.”

Igniting the Flame

Like any Twitter trend that goes viral within a niche community, the Lightning Torch began as a bit of “fun.” Hodlonaut, whom I have described as an astronautical tomcat before (and will again and again), wanted to spread excitement for and awareness of the Lightning Network, so he decided to send 100,000 satoshis to the first person in his tweet thread that he trusted.

It came with a catch — or at least an expectation. The recipient would have to add 10,000 sats and then pass it on to someone else, then that person would add more, and so on.

Some LN fun..

– I send 100k sats with https://t.co/va7XSnFii0 to the first person I choose to trust that replies to this.
– That person adds 10k sats and sends 110k to someone (Either from reply to a new tweet, or this thread)

.. and so on

How many sats before it breaks?

— hodlonaut🌮⚡🔑 (@hodlonaut) January 19, 2019

“If somebody asked me on the first day, ‘How far do you think it would go?’ I would have said, ‘10 or 20 hops,’” Hodlnaut recalled. Turns out, he was lowballing it. After 292 passes, it would reach the 4.29 million satoshi limit Hodlonaut set for it.

The seminal passes were mainly lowkey Bitcoin enthusiasts and/or professionals just looking to get in on the fun. They included a couple of duplicate passings, as interest wasn’t fully fledged. Everything ran pretty smoothly during the Torch’s first days and (nearly) everyone played nice. I say “nearly” because, on the 14th pass, the Torch ran into a problem.

What if I Decide it to keep it? 😂what will happen to me ?

— sirLordBTC (@SerWisdom69) January 20, 2019

sirLordBTC (who, with an EPIC name like that, we’re not surprised tried to screw the system), absconded with the Torch when it was worth under $10. So, all in all, it’s not like he profited much from his sophomoric trick — he likely just wanted to be a contrarian little edgelord.

Hodlonaut actually predicted that, after those first 10 to 20 successful hops, at some point the Torch would be stolen. Technically, his foresight was accurate but, thankfully, the sender, Ruben Johansen, refueled the Torch with 250,000 satoshi and passed it along to someone else. Cracking on, the only other trouble the Torch had would come at 2.51 million satoshis, when pseudonymous user eduard_btc decided to “seize” it because he could.

So I’m currently proudly holding the Lightning Torch.

I’ll seize it because i can, and no one can stop me. This is bitcoin,

Lightning Network is unfairly cheap and fast #LNTrustChain #bitcoin #reckless

— Eduard ⚡️ (@eduard_btc) January 31, 2019

He received a lot of heat in the ensuing Twitter thread, wherein he justified his decision with the whole “don’t trust, verify” schtick. Still, he eventually buckled under the communal pressure as the general consensus was that he was acting like a jerk, so he sent it back to sender Klaus Lovegreen, who had already pledged to reup the balance and pass it on to a more trustworthy individual.

Building Heat

Barring those two outlying users, the Torch’s movement has been largely uninterrupted. And it eventually made its way to plenty of big name bitcoiners.

An early one of these was Pierre Rochard. A staunch Bitcoin maximalist, Rochard’s popular Lightning node launcher has garnered him a reputation for being one of the space’s premier Lightning Network enthusiasts and educators, so it made sense that he’d hop on so early, and it’s fitting that he’d get to take part.

From here, the flame would pass between the hoi polloi and high profiles alike. Jack Mallers, Brooke Mallers, Nicolas Dorier, D. Dickerson, John Carvalho and the Bitrefill team, Armin Van Bitcoin, Zack Voel, Anthony Pompliano and even Andreas Antonopoulos would all hold the Torch before it hit the 150 passes mark. Halfway to 300 passes, the Torch’s popularity definitely reached a tipping point.

At this juncture, Matt Odell reached out to Twitter Co-Founder and CEO Jack Dorsey, who responded by sending Odell an invoice. Crypto Twitter freaked out, the news made industry (and mainstream) media headlines and the Torch’s prominence blazed forth, putting it in the hands of even more bitcoin (and other cultural) leaders.

From Dorsey, it would go to Lightning Labs Co-Founder Elizabeth Stark. The next 85 passes would be populated by industry heavyweights like Samson Mow, Riccardo Spagni, Alena Satoshi, Whale Panda, Giacomo Zucco, Changpeng Zhao (who took the opportunity to shill BNB), Justin Sun (who took the opportunity to shill TRON), Erik Voorhees, Meltem Demoirs, the BitMEX Research team, Ben Davenport, Randy Brito, the CoinGecko team, Boxmining, Mia Tam, Andy Cheung, Charlie Shrem, Vijay Boyapati, Adam Back, Reid Hoffman — and even the team here at Bitcoin Magazine.

Later on in its lifespan, it would also pass through the hands of the team at Slush Pool, Peter Wuille, Jill Carlson, Laura Shin, Peter McCormack, the “Free Ross Ulbricht” campaign and our own Aaron van Wirdum.

With names like these partaking, the Torch’s popularity was hotter than ever. What started as a fun experiment had grown into a cultural movement of sorts with multiple components. This memetic metamorphosis (both the cultural evolution of the Torch and its meme value) has even been chronicled in the artistic renderings of CryptoScamHub. In short, the Torch became immensely popular and graduated to full meme status; the tracking of it has become a sort of pastime in the bear market and big names fanned its popularity.

But this popularity also had the unintended consequence of shutting common bitcoiners out. Some on Twitter complained that the surplus of elites vying for the Torch meant that they had become overrepresented in the pool of passers. Tweeting his opinion, Hodlonaut agreed and suggested that it would be wise to keep the process from devolving into exclusivity.

“It looked at some point like it would turn into something that was unavailable to the common guy,” he told Bitcoin Magazine. “I think fortunately we ended up with a good balance overall. There have been periods of only high-profile people, but pretty organically, it ended up in the hands of lower-profile people.”

Circumventing Sanctions, Reaching Disadvantaged Populations

Following a particularly long strand of high-flying passers which ended with Bitcoin Magazine, the Torch not only landed in the hands of under-the-radar bitcoiners, but it would blaze on in some of the areas that need bitcoin the most.

“Bitcoin is a safe-haven,” Ziya Sadr, an Iranian Bitcoin enthusiast and technology writer who took the Torch, told Bitcoin Magazine.

Around the time we took the Torch, a groundswell of community sentiment was pushing for Sadr to accept the Torch on behalf of Iran. The symbolic move would speak volumes to the power of permissionless, censorship-resistant currency, given the international sanctions that have economically annexed the country from the bulk of the world and its government’s repressive stance against technology and financial tools (bitcoin being no exception here).

There was a general fear that, as a financial instrument, bitcoin is prone to the financial sanctions that the U.S. government has levied against Iran. As a U.S.-based company, Bitcoin Magazine’s owner, BTC Inc, didn’t want to take the risk. We even asked the U.S. Treasury on Twitter if sending bitcoin to Iran this way would be permissible (and didn’t get a reply).

So we sent it to Welsh bitcoiner Bitgeiniog instead, who (as promised) passed it on to Sadr in what they called a “cypherpunk, authoritarian-busting move.” For Sadr, who believes that the fretting over sanctions “triggered people to think that bitcoin isn’t what it’s meant to be: a tool to defy censorship which will not conform to governments and sanctions,” the historic moment was incredibly moving and had a significant impact on the Iranian Bitcoin community.

“It was a very bold and public experiment, getting in touch with sanctioned people, people who are exiled from the rest of the world,” he said. “This carried a lot of optimism for the Iran Bitcoin community, and this community represents the rest of people in Iran: the Bitcoin community has people from every category; there are businessmen, investors, entrepreneurs, teachers. It gave us promise; it proved to us that Bitcoin is borderless.”

Hodlonaut said something similar about the Iranian pass in our conversation, namely that the “main takeaway [is that the Torch] connects people directly.”

Sadr said that this gesture of goodwill shows that the Iranian Bitcoin community, which some of us in the West may ignore, “is on equal ground” with the rest of the world.

I’d venture to say they’re even on higher ground. In a country where MasterCard and PayPal are banned (and your bank account can be frozen if you’re caught transacting with either), bitcoin offers a tenable alternative to an unstable economic climate.

It even opens up access to the web at large, said Sadr. He purchased a virtual private network using bitcoin from NordVPN, something he couldn’t dream of doing with the rial, given international sanctions. Telegram, YouTube, Twitter, you name it — all of these are blocked in Iran, but they’re accessible with a VPN.

Sadr, who freelances in exchange for bitcoin to make ends meet, said that bitcoin is increasing in popularity as the rial’s value plummets. People are attracted to earning their wages in foreign currency and bitcoin is more attractive still, given its ability to circumvent the government’s vice grip on personal finances.

“There’s a very active black market — everything is a black market in Iran. Foreign currency markets are black market, so it’s actually the norm,” Sadr said.

LocalBitcoins and Telegram chats are part of this black market and have become common watering holes, and there are two Iran-specific exchanges that people will use to trade, despite the government’s best efforts to block the URLs to these sites.

For the Iranian Bitcoin community and its online hubs, Sadr said that “the number has been growing, even though it’s a bear market — we still see, regardless of all the FUD that’s being spread in the media and the space, the numbers are growing in the communities that I’m active in.”

As part of the Persian New Year custom, Sadr and his bitcoin buddies have been giving people money. But for this year’s holiday, they’re not passing out rials — they’re sending sats through the Lightning Network or through mainnet. He thinks that the token of gratitude will help to educate his countrymen and help ease their access to a financial system that they otherwise might not be able to leverage.

“I meet a lot of people who know that they can use bitcoin to transfer money easily, but they just haven’t tried it yet,” Sadr said.

The Torch’s Legacy

The situation in Iran calls to memory Venezuela’s own political and economic hardship. The Torch has made it there, too — multiple times in fact. The Torch ultimately reached Bitcoin Venezuela, a charity organization which has fed thousands of economically dispossessed citizens thanks to cryptocurrency donations. As its final bearer, Bitcoin Venezuela will blow the Torch out and transmute its altruistic embers into food, necessities and medicine for Venezuelans in need. A number of community members have pledged to match this donation.

We had to do a second take (big TXs are a challenge with LN right now!), but here’s documentation from the receiving node. @AaronvanW @BitcoinMagazine @TheBlock__ @pierre_rochard @francispouliot_ @adam3us @Chris_Stewart_5 @starkness @jack @BitcoinErrorLog @Excellion @johanth pic.twitter.com/agAjqj96na

— torkel (@torkelrogstad) April 11, 2019

The Lightning Torch may have begun as fun, but its intersection with economically and politically destabilized areas is anything but trivial. Its ability to transcend borders, nationalities and ideologies is testament to the fact that Satoshi’s gift to the world (and its grassroots community) is resilient and, by and large, chock-full of goodwill.

“I think that says a lot about this community,” Hodlonaut mused. “People are good in this space. I’ve seen so much positive stuff coming out of this.”

The “random” and “organic” trajectory of the Torch, he continued, “tells volumes about the global nature of bitcoin.” Sure as Satoshi, the proof is in the numbers.

In total, 278 unique participants from 56 countries have sent the Torch to every continent except for Antarctica (though one passer did place their phone on a rock from Antarctica while receiving it, but that really only counts in spirit). Just over 7 BTC has been transacted (roughly 700 million satoshis!) over a period of 83 days.

So inspiring is this experiment-turned-movement that it has spawned offshoots. Obscure altcoin Ravencoin had an on-chain version, and there’s one called the Tiny Torch that has taken off on Bitcoin’s Lightning Network, too. While he had it, Litecoin creator Charlie Lee intimated that he would fork the Torch to Litecoin’s Lightning Network. This didn’t go over too well, though, and Lee eventually removed the tweet with this claim (some saw it as self-promotion and Hodlonaut wanted to make sure there was no confusion between offshoots and the #LNTrustChain hashtag that has demarcated the Torch’s movement).

Hodlonaut doesn’t want the original to fork either, less it get “stale.” He said that a finish line is necessary and that, without it, the Torch loses its significance.

He also told Bitcoin Magazine that keeping track of the Torch’s movement and documenting the phenomenon on its website has been a taxing, “around the clock” job. Given how much impact the Torch has had, we asked him what would be next when this was all over.

“I think I need a vacation,” he chuckled in response.

Well, he’s more than earned one, and thanks to the number of ancillary torches that have proliferated under the light of the original, he can take his rest while the influence of his creativity shines forth in multiple iterations. Much like Satoshi passing the Torch of his creation to a decentralized community of developers and enthusiasts, Hodlonaut’s ingenuity has been passed to a community eager to continue this exercise of trust.

So, the Lightning Torch’s creator can take his vacation; Bitcoin doesn’t take vacations.

To see all of the places the Torch has been, you can track its movements here. If you would like to join others in donating to Bitcoin Venezuela, please visit the charity’s website.

This article originally appeared on Bitcoin Magazine.

Cartoon: Snakes and Ladders

Startup life is full of snakes and ladders, but in the blockchain market there are currently more snakes.To play the game, roll the dice to advance … if you land on a snake’s head, go to its tail. If you land on …

U.K. Brexit Deal Beamed Into Space Through Blockstream’s Satellite Messaging App

Blockstream Sattelite

Earlier this month, blockchain startup Blockstream announced that its satellite messaging application programming interface (API) was launching on Bitcoin’s mainnet. Now, one enterprising bitcoiner has used this platform to beam the U.K.’s proposed Brexit deal into space.

The application allows users to beam data into space, which can be downloaded by anyone with the appropriate receiver. Users can pay for the service using the Lightning Network.

In a post published on crypto review platform How to Buy Crypto, crypto researcher Richard Gargan provided a description of his experience with Blockstream’s satellite application and how he used it to beam the full text of British Prime Minister Theresa May’s proposed EU withdrawal agreement into space. He followed the manual process (detailed here) of transmitting data to the blockchain.

In the post, Gargan explained that he first converted May’s proposed agreement into a .txt file. From there, he split the file (which had a size of roughly 820 kb) into 82 separate pieces of 10 kb each. (He had to divide the file this way because the satellite’s transmission limit is 10 kb.)

Gargan then uploaded the files one at a time. He reported having to pay 0.00000604800 BTC for a single file — the fees for sending the file plus an additional fee for using the Lightning Network.

Gargan ended up spending a total of 0.000495936 BTC (worth about £1.49 or $1.96) to transmit the full document to the blockchain. Long story short, Theresa May’s Brexit Withdrawal Agreement is now in space and since it’s not encrypted, anyone with the right equipment or setup can download it. It took him 1.5 hours to upload the whole document.

His method, while simple and straightforward enough, shows that there’s still a fairly constrained limitation on file sizes that Blockstream could improve on.

“It was a very laborious and tedious process, as clearly it’s designed to send short messages,” Gargan told Bitcoin Magazine via email.

Gargan reached out to Blockstream through Internet Relay Chat to inquire about the reasoning behind the 10 kb file size limit. Blockstream responded that the file size is “currently limited so that other transmissions do not become backlogged.”

Blockstream CTO Adam Back told Bitcoin Magazine that the current file size limit exists because “the current implementation is serialised and only streams one message at a time, so in order to provide [a] timely message service to many users, we currently implement that with a message limit. (Otherwise one person could pay to send a very large message and then other users would not be able to send for some time.)”

The team at Blockstream has reason to believe that there may be some backlog on its service.

“We have received quite a bit of interest in using the satellite APIs for various application and Bitcoin-related use cases,” Back added. “We plan to increase the available bandwidth based on demand by reinvesting the revenue to provide faster service.”

While this use case is revolutionary for the industry, it demonstrates an area in which more work could be done, particularly in the process of encoding data and breaking it into smaller chunks before transmitting it. This process will invariably make it difficult to send content that loses its quality when broken into smaller chunks.

Back said that Blockstream is continuing to improve the flexibility of its satellite data APIs and is expecting to have more flexible stream capability in future upgrades.

“It would also be possible with the existing satellite messaging API for application programmers to make a utility to fragment and reassemble [the content], or even stream low- to medium-bandwidth content,” he said.

Part of the motivation behind Blockstream’s satellite service was to provide a means of reducing the Bitcoin network’s dependency on conventional internet connectivity. It works by allowing users to broadcast data all over the world via the Bitcoin network, while ensuring security and accessibility.

Blockstream launched its satellite service in 2017 with a focus on transmitting messages to receivers in Europe, Africa and the Americas. It later expanded to Asia and added support for Lightning payments.

This article originally appeared on Bitcoin Magazine.

This Crypto Art Auction Lets Venezuelans Dismantle Maduro Bolivar by Bolivar

cryptograf venezuela.jpg

To donate to causes aiding those in Venezuela, please visit #AirdropVenezuela’s website or Bitcoin Venezuela’s website. To partake in cryptograffiti’s charity auction, please visit the donation page and tune in to the live stream here.

“Literally and figuratively, the Venezuelan people are bringing down Maduro.”

This is how cryptograffiti described his latest work, a charity piece that he will be auctioning off online through a live stream in Colombia. The mural, constructed entirely of 1,000 bolivars, is painted over with a portrait of Nicolas Maduro, the autocratic leader of Venezuela whose power has been constitutionally challenged by opposition leader Juan Guaido since January of this year. In the painting, Maduro’s mouth is censored with a blue bar bearing the hashtag #AirdropVenezuela, an ironic nod to the political and economic repressions the Venezuelan people have endured while also applauding their ability to persevere through this hardship.

As usual with the crypto artist’s symbolic and subversive work, the auction comes with a twist — a deconstructive one.

With each donation, a bolivar from the mural will be torn off by a Venezuelan citizen. Broadcasted from Cúcuta, Colombia, a city bordering Venezuela, the cross-border protest will allow the Venezuelans to vent political frustrations and simultaneously attract donations for aid.

“The piece-by-piece dismantling of the bolivars by those choosing to donate crypto is meant to represent a new beginning made possible by a new form of money not controlled by any one authority. There is also symbolism in how these donations have the ability to come from outside of a region known for heavily regulated currency controls,” cryptograffiti told Bitcoin Magazine.

The auction will also accompany a live art session where Venezuelan children will create pieces to be sold at a later date.

Since the death of Hugo Chavez in 2013, the policies of Venezuelan president Nicolas Maduro have thrown the country into economic and social turmoil. With an economy ravaged by hyperinflation, rampant poverty and crime have furnished a worsening humanitarian crisis. The crisis reached a bloody impasse on February 21, 2019, as Venezuelan forces opened fire on protesters at the Brazilian border after the government refused to accept humanitarian aid.

It’s proven difficult for aid to penetrate the country’s borders. But bitcoin and other cryptocurrencies have become a vestige of monetary hope for Venezuelan expats who want to send money back home, and cryptograffiti’s auction will leverage crypto’s borderless nature to buy aid from within the country.

In a partnership with AirTM as part of their #AirdropVenezuela campaign, cryptograffiti is directing all donations, which can come by way of cash deposits on AirTM, bitcoin and a host of altcoins, to the philanthropic campaign. As a wider effort, AirdropVenezuela’s goal is to send $1,000,000 worth of cryptocurrencies to 100,000 families in Venezuela. Even just $10 worth of cryptocurrencies “can help a family purchase food, medicine, and scarce imported goods. Access to digital money can help introduce Venezuelans to cryptocurrencies, online freelancer platforms, ecommerce, investments, donations and other income generating web-based opportunities,” the campaign states.

For the art auction in particular, the charity collective has set its fundraising goal at $10,000. Fifty percent of these funds will go to rebuilding the auction venue, the Fundación Renacer, a daycare that provides support for families affected by the financial crisis, while the remaining 50 percent will be distributed with the rest of the funds raised by AirdropVenezuela at the end of April.

I’m in Cúcuta where Venezuelan refugees are arriving by the thousands for food, medical aid & to live free from oppressive rule. @theAirtm & I have teamed up as part of their #AirdropVenezuela campaign to raise funds for those in need via an interactive mural live-streaming now pic.twitter.com/NDVlHCAgId

— cryptograffiti (@cryptograffiti) February 26, 2019

Crypto education company Cripto Conserje will oversee the reconstruction of the daycare, and during the auction, it will host information sessions on how to access, use and store cryptocurrencies, including teaching attendees how to use coins distributed at the event to purchase food kits from one of the auction’s partners.

This education will hopefully unlock crypto’s potential for an economically disenfranchised population that needs it most. For Venezuelans, bitcoin and the like can provide a censorship-resistant method to store and transfer value, something AirTM’s services are trying to make more accessible for Latin American and, more urgently, Venezuelan citizens who lack access to robust banking and a sound currency. The application accommodates more than 200 deposit and withdrawal methods, including crypto, to convert currencies to USD in order to store value and protect it “from possible devaluations.”

When bitcoin is used in Venezuela, it is often as a go-between for a foreign currency and the bolivar or some other, stronger one like the dollar.

Eduardo Gomez, head of support at Purse.io, for example, told Bitcoin Magazine that when Venezuelan expats send money back home with bitcoin, they will typically sell it through LocalBitcoins to a Venezuelan trader, who will then deposit bolivars into the bank account of the expat’s relative. As the economic situation has only degraded further in 2018-2019, LocalBitcoins has seen rapidly increasing trading volumes in Venezuela.

Occasionally, your technically minded Venezuelans will sell the bitcoin themselves for USD (or another foreign currency) and deposit that money into a foreign bank account as savings. Either way, cryptocurrencies typically serve just as an intermediary for value transfer, one that circumvents the tight remittance controls and fee gouging that the Venezuelan government effects with its monopoly over currency conversion and international money transfers.

The AirdropVenezuela campaign wants to take the extra step in getting beneficiaries to use crypto instead of relying on Venezuela’s failing fiat currency. The campaign will donate and educate these citizens on crypto’s significance in their situation, as well as alerting them to online economies that may allow them to receive crypto as payment, such as freelancing.

This is how Gomez, who has been living on bitcoin since 2012, is pulling his family out of poverty. He began receiving bitcoin for freelance translation work online, and after leaving Venezuela, he trades bitcoin for bolivars on LocalBitcoins to send his family funds.

Cryptograffiti hopes his latest work will expose a grim situation which has continued to experience much deserved attention under the international spotlight as of late. But as much as it exposes the severity of the situation, he hopes that the part-performance art, part-visual art will reveal (and convince people of) the solution to these economic woes.

“After reciting the tired ‘maybe it doesn’t apply as directly to you, but Bitcoin is important in authoritarian regimes’ line one too many times, I wanted to do something to contribute to Venezuela and experience the situation first-hand,” he said.

“I’ve been thinking a lot about collaborative art as of late and how it helps spread the message and engage viewers. This led me down the path of a mural that was made up of many different parts that would be interactive in some fashion.”

After the auction is over, two pieces — Maduro’s left and right eyes — will be signed by cryptograffiti and one will be sent to the highest bidder based on his or her preference. The other will go to another donor chosen at random.

Cryptograffiti’s auction is the latest in artist-led philanthropy efforts. Billionaire business mogul Richard Branson hosted a charity concert in Cúcuta last Friday. Branson hoped the concert would raise awareness and some £100 million for the people of Venezuela, and it attracted an appearance by opposition leader Guaido.

In the realm of crypto philanthropy, Bitcoin Venezuela, a charity organization founded by Randy Brito, also exports bitcoin funding for aid inside the country. Subsisting on donations in the ballpark of $100, the organization sends funds into the country to workers on the ground who provide food, clothes, medical supplies and other provisions to struggling Venezuelans. Once the Lightning Torch, a Lightning network payment experiment that has been making global rounds, reaches the network’s channel limit, its creator, hodolnaut, intends to have the final sum donated to the charity.

Image courtesy of cryptografitti.

This article originally appeared on Bitcoin Magazine.

So Far, Only Two Businesses in Ohio Have Used Bitcoin to Pay Taxes


According to a recent statement made by Ohio’s state treasurer, so far, only two businesses have filed their taxes in crypto using the state’s crypto tax payment scheme.

Speaking at a forum organized by the Ohio State Associated Press on February 19, 2019,Robert Sprague fielded questions about the department’s experiences with the newly launched bitcoin payment option for taxes, which was set up by his predecessor Josh Mandel in December 2018. Sprague, who assumed his position a little over a month ago, states that the country has received only two tax payments so far on the state’s official crypto payment platform, OhioCrypto.com

In addition, he said, “We’re reviewing how [the program] might be either curtailed or might be expanded, and what our counter-party risk is with that vendor.”

However, a spokesperson declined to offer specific details concerning the exact value the state has received in bitcoin-paid taxes, claiming that such tax-related information is covered by financial confidentiality.

Still, the slow rate of usage won’t deter the state, whose lawmakers are hoping to become a major hub for the blockchain industry.

As stated earlier, the new tax payment system was established by Josh Mandel, who viewed cryptocurrencies as a legitimate form of money.

At the time, Mendel said:

“Our biggest motive here was to give taxpayers more options in paying their taxes,” going further to tell Bloomberg that the state was “proud to do our small part and take this small step to make Ohio the first state in America to enable taxpayers to be able to pay via cryptocurrency.”

According to reports, the filing process for making these payments includes three steps.

The first step is registration. Businesses have to register with the Office of the Ohio Treasurer and set up their accounts on the state’s tax payment platform. From there, they would enter their tax details (including tax period and the payment amount) on the platform, after which time they can pay their taxes with bitcoin from a “compatible” wallet (these include the BRD, Mycelium and the Bitcoin Core client, as well as others “compatible with the Bitcoin Payment Protocol”).

Once made, the payments are processed by BitPay, the Atlanta-based bitcoin payment processing firm. From BitPay, the digital assets are converted into dollars and sent back to the state treasurer’s office as the final step of the process.

This article originally appeared on Bitcoin Magazine.

Wrap Your Head Around This: BTC Is Now Featured as a Token on Ethereum


It happened: Bitcoin is now an Ethereum token.

Wrapped Bitcoin (WBTC), an ERC-20 token with a 1-1 peg to bitcoin, went live on the Ethereum network on the final day of January, “the first token that makes Bitcoin compatible with the Ethereum chain,” its architects say.

Kyber Network, Bitgo and Ren spearheaded the “community led” initiative, which has spread its reach to AirSwap, BitGo, Blockfolio, Compound, DDEX / Hydro, Dharma, Gnosis, GOPAX, Kyber Network, Loopring Protocol, MakerDAO, OmiseGO, Prycto, Ren, Set Protocol, and TheOcean. These members of the WBTC DAO are a mixture of liquidity, infrastructure and custodial partners. The token’s network will rely on some of them to facilitate BTC to WBTC swaps for its users.

To exchange their BTC for WBTC or vice versa, users must enter into a request with a WBTC merchant, someone who basically “sells” (or more accurately, distributes) WBTC to users in exchange for bitcoin (or bitcoin in exchange for WBTC) and go through KYC. These merchants act as a go-between for the user and the network’s liquidity pool, the custodians.

That merchant takes this request to a custodian, who will either deny or honor the request and mint or burn WBTC for the user. Minting and burning takes place directly between the merchant and the custodian through an atomic swap, a protocol that allows users to trustlessly trade assets cross-chain —in this case, BTC and WBTC.

To trigger the process, a merchant would submit a minting request to an Ethereum smart contract while simultaneously sending bitcoin to the custodian.

“The custodian then waits for 6 confirmations on the bitcoin chain, and approves the minting request on the Ethereum network, and the approval triggers the mint operation in which the merchant gets the WBTC,” Yaron Velner, the CTO of Kyber Network, told Bitcoin Magazine.

The user is not involved in this swap in this first swap in any way. To claim their tokens/bitcoin, the user then has to enter in either an atomic swap or a trusted exchange with the merchant.

Kyber Network and Republic Protocol will kickstart the network as its first merchants, and

Eight Wrapped Bitcoin community members(AirSwap, Dharma, ETHfinex, GOPAX, Kyber Network, Prycto, Ren and Set Protocol) will kickstart the network’s WBTC and BTC liquidity vehicle as merchants, while BitGo will be the sole custodian to start.

Members of the WBTC DAO will oversee a multisignature wallet that will handle the permissions and keys necessary for assigning or retracting merchant and custodian roles.

The (Peg) Ins and Outs

The project promises to bring Ethereum smart contract utility to bitcoin and the benefit of bitcoin’s liquidity to ether’s token market.

Currently, Ethereum dominates the decentralized exchange (DEX) landscape, and there’s no way for traders to directly trade their bitcoin for tokens (they have to go through centralized exchanges for that). Giving traders the option to import bitcoin to Ethereum to trade its value as an ERC-20 token, WBTC could unleash a sea of bitcoin liquidity into Ethereum’s Decentralized Exchanges — this is likely why IDEX, the largest DEX on Ethereum, is involved, along with Airswap, DDEX, ETHfinex and others).

As an ERC-20 token, WBTC can also execute smart contracts, meaning dApps could use the token (like WBTC community partners Compound, Dharma, dYdX, bZx, Gnosis, Maker and Set protocol), and developers can start building new applications on WBTC. Wholesale, the project sells itself as “[combing] the benefits of Ethereum and Bitcoin, making it simple to handle the wrapped currency with only the Ethereum node.”

It’s an ambitious project, bringing together crypto’s two most valued networks, one that wants to utilize the best of both cipher worlds. It’s one, though, that Wrapped Bitcoin is backing up with immediate utility and liquidity at launch, but it’s also one that comes with tradeoffs.

“Kyber Network and Ren have procured an initial amount of WBTC tokens from their own Bitcoin inventory to provide initial liquidity and make WBTC immediately available for swaps with users. BitGo will be the initial custodian,” a press release states.

“Eight initial merchants will be facilitating conversion between WBTC and BTC: AirSwap, Dharma, ETHfinex, GOPAX, Kyber Network, Prycto, Ren, and Set Protocol.”

The token service is starting centralized, and you have to go through KYC to be verified with merchants to submit token minting or burning requests. BitGo will be the sole custodian from the beginning, meaning that all swaps will be conducted by the blockchain and wallet services company.

“Various decentralized and centralized exchanges have also procured WBTC inventory to support liquidity for the token with the live supply of WBTC observable on the WBTC dashboard,” the press release also states.” WBTC will also have usage on a handful of dApps out the gate, including “bZx, Compound, Dharma, dYdX, and DApps and wallets integrated with Kyber Network.” CoinGecko, the project’s market data partner, will be covering WBTC data.

Cautions and Clarifications

The service is fairly centralized out of the gate, something the project recognizes in its whitepaper, describing its structure as a “federated governance model.” Even if the merchants are distributed (and sparsely at that for the time being), BitGo’s custody of pegged-in bitcoin is both a counterparty risk and single point of failure. Of course, BitGo has multisignature and cold wallet services to mitigate these risks.

But for a project that brands itself as giving users an out from centralized services like exchanges, it offers a similar degree of centralization with just a few more steps (instead of submitting your coins to the custody of a centralized exchange, you’re putting them in custody with a separate company and then using the tokens of credit this company gives you (instead of the credit you’d use on the centralized exchange) to trade them elsewhere.

Still a functional bitcoin-to-ethereum bridge is a novel addition to the industry’s architecture, something that RSK is working on and Blockstream could theoretically build with Liquid. And, as Vitalik Buterin said on Twitter, Liquid’s federated sidechain is semi-subject to the same centralization as Wrapped Bitcoin, but Liquid’s liquidity partners are more evenly distributed (and don’t require a third party for custody).

WBTC, like Liquid, could sufficiently decentralize in the future given enough adoption, Buterin concludes.

Sidechains like Liquid work in exactly the same way. Granted Liquid currently has more participants, but I hope WBTC can decentralize somewhat over time too.

— Vitalik Non-giver of Ether (@VitalikButerin) January 30, 2019

Wrapped Bitcoin lists BitGo as its “initial” custodian, leaving a vague sense that more will come in the future, but they will have to be regulated to hold the bitcoin, the project’s whitepaper makes clear If its influence fans out, more merchants and custodians could provide some risk mitigation and help the project decentralize. Its website has open applications for partnerships, keeping with the initiative’s claim to be a community-driven effort.

“The fundamental design of WBTC and the continuing commitment of all members to openness will form the essential building blocks for a transparent process framework and governance structure. Relying on these foundational principles, WBTC will remain a firmly community-led initiative into the future, focused on driving continued innovation for the enhancement of the entire ecosystem.”

This article originally appeared on Bitcoin Magazine.