Bitcoin Plaza

Saturday, March 14, 2015

Is China the Primary Driving Force in Bitcoin?

China, with its fast-growing economy, has definitely a big role in Bitcoin’s economy, but with the recently released Goldman Sachs report, china is not only considered as having a big role in the cryp

Friday, March 13, 2015

OKCoin Reveals Security Policy: Sets Standard for Operational Transparency

On Friday, Star Xu, CEO of trading platform OKCoin, published his company’s security policy in a Reddit thread.

“OKCoin has decided to openly share [its] cold wallet security information. Through this transparency, OKCoin aims to assure users of the security of their funds,” the post stated.

Xu then encouraged members of the community to contribute feedback.

He began by outlining the company’s security design philosophy, focusing on key vulnerabilities inherent in Internet connections, USB drives and reliance on centralized management.

He went on to explain how the company’s security design protocol addressed concerns surrounding private key generation and backup, depositing bitcoin from an online hot wallet to an offline cold wallet, and retrieving bitcoin from an offline cold wallet.

The cold wallet addresses can only hold a limited amount of bitcoin.

Private keys are stored on completely offline computers.

Certainty that the private key never had any contact with the Internet or USBs.

Encrypted private key paper document requires offsite backup, and is controlled by different people in different places.

AES private key password shall also be controlled by different people in different places, and shall not be the same person with the master of the private key.

Holders of the AES private key password and those with the ability to retrieve the encrypted private key are different people and in different places.

Once a private key has been used to transfer bitcoin out of the address, the address is no longer to be used again for deposits.

In an interview with Bitcoin Magazine, Michael Perklin, president of the CryptoCurrency Certification Consortium (C4) and president of Bitcoinsultants Inc., commended Xu.

“Having a strong security policy is one of five things that every cryptocurrency storage solution should have,” Perklin said, adding that the other four pillars include “procedures, trained personnel, secure hardware and secure software.”

According to C4’s Cryptocurrency Security Standard matrix, it appears that OKCoin’s manifesto covers many, though not all, of the points companies need to include in their security policies to earn Level II and Level III ratings.

Perklin added that by publishing its security policy, OKCoin doesn’t lose anything in terms of security. The move should, in fact, give their clients a degree of confidence.

“Kudos to OKCoin for doing this,” Perklin said.

CoinTelegraph India Launches

CoinTelegraph launches dedicated Indian site, as Bitcoin spreads around the world.

Sean’s Outpost feeds its 150,000th meal to the homeless

After just 2 years, the charity Sean's Outpost has fed its 150,000th meal to the homeless today using Bitcoin.

Proof-of-Importance: How NEM is Going to Add Reputations to the Blockchain

While we all live in societies where money is mostly considered as a mean to bring wealth and prosperity, there are other factors and aspects in life that all people appreciate. One of these elements

MAR 13 DIGEST: Garzik signs space deal, IBM working on Bitcoin rival

Bitcoin core developer Jeff Garzik has signed a deal to have his full-node satellites built, ready to be launched into orbit. IBM is rumored to be working on its own version of Bitcoin designed to int

Block Verify Uses Blockchains to End Counterfeiting and ‘Make World More Honest’

The team behind the “blockchain-based anti-counterfeit solution,” Block Verify, wants to have a global, positive social impact by using blockchain technology to “make the world more honest.”

Thursday, March 12, 2015

Wall Street Bitcoin Alliance Looking to Shape the New 'Finance 2.0' Era

The Wall Street Bitcoin Alliance (WSBA), a trade advocacy group composed of financial market professionals, is looking to "guide and promote comprehensive adoption of digital currency and blockchain t

Bter Teams with JUA.com to Upgrade Security, Repay Victims of Recent Hack

The newly rebuilt Bter.com, one of the world’s largest altcoin trading platforms, has announced that it has joined forces with JUA.com and is stepping up its security system. It has also set forth a plan for repaying all users who lost funds due to a recent theft.

On the security side, JUA.com will provide 100 percent cold wallet escrow storage of users’ funds, and will gradually take on hot wallet security for deposits and withdrawals as well. Bter has already worked with JUA.com since the hack to review all security-related code, and has completely rebuilt the trading platform’s back end.

JUA.com will also front a 1,000 bitcoin interest-free loan to Bter in exchange for shares, for the purpose of repaying losses to clients. In turn, Bter also has pledged to seek further financing from other sources to help speed up the repayment timeline.

Bter and JUA.com have indicated that they will be working together in the coming months to bring a “new profit model and more services to Bter’s users.”

Bter said that “all Bter’s future profit shall be used to pay [back] the BTC loss [to] users first until all the lost BTC is paid up.” At the same time, it is offering users one month of free trading on the site “as our thanks for your trust and support.”

The History of the Hack

On February 14, 2015, 7,170 bitcoin was reported stolen from Bter in one of the largest hacks in cryptocurrency history. Bter claims to have traced the stolen funds to the bitcoin mixer Bitcoin Fog, thanks to the efforts of security teams and the crypto community. It has been unable to do anything substantial with this information to date.

Since the first days of the breach, Bter has accepted full responsibility for the loss and has pledged to repay all missing funds; at one point, it even considered selling all its assets to fulfill that commitment. The new partnership with JUA.com is designed to ensure that Bter can move forward with some hope of future growth.

Besides being a specialist in digital currency financial services, security and storage, JUA.com also is also affiliated with BW.com, one of the largest mining farms and mining pools in the world, accounting for 20 percent of global hashing power.

Ulbricht’s Lawyer Files for Retrial

Ross Ulbricht has not even been sentenced yet for his conviction as leader of Silk Road, the Amazon for drugs, and he’s already requesting a new trial.

Joshua Dratel, Ulbricht’s attorney, filed a motion that includes evidence that suggests the federal government gained access to the server that Silk Road was on without a warrant. Further, the defense argues that the government may have tried to hack into the site.

On February 4, after only 3 ½ hours of deliberation, a New York federal jury found Ulbricht guilty on all seven charges, including drug trafficking, computer hacking, money laundering, running a criminal enterprise and fraud with identification documents. Should the seven felonies stand, Ulbricht would be sentenced to a minimum of 20 years in prison.

According to a memo filed Friday evening, Dratel is looking for a new trial for Ulbricht. The defense is also looking to re-visit a motion that would have suppressed all evidence gained from the Silk Road servers. The defense argues that the evidence was obtained without a warrant, violating Ulbricht’s Fourth Amendment rights.

Further, Dratel is arguing that Ulbricht’s Fifth Amendment rights have been violated.

“Mr. Ulbricht should be granted a new trial because the government failed to provide exculpatory material and information in a timely manner, thereby denying him his Fifth Amendment right to due process and a fair trial,” Dratel wrote in his memo.

Dratel argued that 5,000 pages of material related to the testimony of Department of Homeland Security agent Jared Der-Yeghiayan were not provided in a timely manner. During cross-examination, Der-Yeghiayan revealed that his group had been looking at Mark Karpeles, the owner of Mt. Gox, as the true “Dread Pirate Roberts,” the pseudonym used by the site’s founder.

Dratel has argued that this evidence was provided only two weeks before the trial started, thus making it nearly impossible for the defense to pull together a proper argument in time for the start date.

With respect to the Fourth Amendment violations, Dratel wrote: “Mr. Ulbricht’s motion to suppress evidence should be reopened based on information produced by the government in connection with trial, and should be granted in its entirety.”

The memo went on to say that: “In the context of Mr. Ulbricht’s suppression motion, this surveillance raises some novel Fourth Amendment issues, and also provides further evidence that the government discovered the Internet Protocol (hereinafter “IP”) address for the Iceland server ending in “.49” through warrantless TOR network surveillance.”

Dratel argued before that the government had hacked into the server. But the government argued that if the FBI had hacked the Silk Road server it would be legal because the server was based in Iceland and Ulbricht had not made clear that he was the owner. In other words, there can’t be a violation of constitutional rights if no one comes forward to say that their rights were violated.

Unfortunately for Ulbricht, there were five requests for a mistrial put forth by Dratel during the trial and none were allowed by the judge. It is highly unlikely that these requests will be granted, especially since Ulbricht already has been convicted and he’s requesting the retrial from the same judge who refused a mistrial repeatedly.

And Dratel may not be truly looking for a retrial. Instead, the motion might all be part of a larger plan to file an appeal.

Ulbricht and his defense team have until April 4 to file their formal appeal.

Bitreserve Clarifies Comparison to Netscape: 'Bitcoin Could be Integral but Invisible'

When Bitreserve's CEO Halsey Minor made a blog post comparing Bitcoin to Netscape, it made a lot of people upset. Why, many thought, would the CEO of a Bitcoin company compare Bitcoin to the long defu

Wall Street Bitcoin Alliance Launches to Reflect Growing Institutional Interest

The Wall Street Bitcoin Alliance (WSBA) is a new organization formed by business and technology executives and leaders within the financial industry, including banks, broker-dealers, institutional investors and hedge funds.

The announcement states that the mission of the WSBA is to guide and promote comprehensive adoption of digital currency and blockchain technology across financial markets. The member-driven WSBA will interface with national and international government agencies and regulators, as well as technology innovators.

“Bitcoin and blockchain technology and protocols represent a seismic shift in how financial markets, and all aspects of the global economy, will operate in the future,” said Ron Quaranta, executive director of WSBA.

“As we work to incorporate and adapt these powerful technological advances to the world of ‘Finance 2.0′, having an organized, strategic approach will aid all participants understand and embrace the Bitcoin ecosystem,” he said. “We believe that the long-term result will be more efficient markets, more cost-effective solutions for equity ownership, investment and trading and, ultimately, greater value and wealth creation for all participants in the world of finance and trading.”

Quaranta is the CEO of Digital Currency Labs, a financial technology and strategic advisory company whose mission is to bridge the gap between the emerging world of digital currencies and Wall Street.

The executive committee of WSBA also includes James Jalil, senior partner and head of the cryptocurrency practice at the law firm of Thompson Hine; Gil Luria, managing director at Wedbush Securities’ and Christian Martin, chief executive officer of TeraExchange, which operates the first regulated U.S. Bitcoin derivatives exchange.

By reverse-merging with publicly traded company MGT Capital Investments, TeraExchange recently created the first publicly traded U.S. Bitcoin derivatives exchange.

Full WSBA membership is limited to existing financial market-based firms, including U.S.-registered broker dealers, banks, institutional investment firms and hedge funds.

While full membership criteria are quite strict, an associate membership option is open to individuals and companies providing services and capabilities within the Bitcoin and blockchain ecosystem. Bitcoin technology developers, vendors and consultants will be able to participate in the WSBA as associate members.

“Bitcoin and the blockchain represent a seismic shift in how financial markets, and all aspects of the global economy, operate. In the same way that the Internet gave us a powerful way to share and access information, Bitcoin and blockchain technology now gives us a powerful way to share and access value,” notes the WSBA website. “The long-term result will be more efficient markets, more cost-effective solutions for equity ownership, investment and trading and, ultimately, greater value and wealth creation for all participants in the world of finance and trading.”

Initially, the WSBA will focus on Bitcoin regulatory frameworks such as BitLicense, tax-related aspects of digital currencies, and technological innovation in the Bitcoin ecosystem. The last category is very wide, but it seems likely that the WSBA intends to investigate interfaces and bridges between the emerging digital economy and the mainstream financial system.

The WSBA will have a strategic partnership with the Digital Currency Council (DCC), a Bitcoin consultancy and education center that offers training, certification, referrals and networking opportunities to fintech professionals.