Bitcoin Plaza

Tuesday, May 5, 2015

CNET Founder to Launch BitReserve in India

On May 4, The Times of India reported that Halsey Minor, the multi-millionaire entrepreneur and founder/CEO of BitReserve, engaged a meeting with the local regulators for the company’s future plans to launch its services there.

“After the U.S., U.K. and China, we want to now set up operations in India, and we are talking to regulators and potential partners on a range of our Internet-based finance offerings,” Minor told Times of India.

The aim of the launch in India is to provide users with “direct control of their money,” as Minor plans to offer BitReserve as a “financial inclusion product which can be used for money transfers.”

Officially launched in May of 2014, BitReserve is a bitcoin and fiat currency platform founded by Minor, the technology entrepreneur who founded CNET in 1993. CNET is an American media website that publishes reviews, news, articles, blogs, podcasts and videos on technology which was acquired by CBS Corp. for $1.8 billion USD.

BitReserve is a Bitcoin service which was originally developed to protect merchants and users from bitcoin volatility.

“If you want to create something that is perceived as money, it’s going to have to represent the same value that people are using already,” Minor said at a news conference announcing BitReserve last May.

As a solution to the biggest problem for bitcoin merchants – price volatility – BitReserve allows users to hold bitcoin in stable currencies, such as the U.S. dollars, U.K. pounds, Chinese yuan, Japanese yen and Korean won.

Users can hold bitcoin in what BitReserve refers to as “currency cards,” and still send bitcoin around the network for free. Users can simply convert or transfer the BTCs to the preferred currency cards such as the dollar card, and avoid the price volatility of bitcoin. The fiat-to-fiat transfers are free of charge, and the users are charged only 0.45 percent for BTC to USD conversions.

Transactions on BitReserve are also processed faster, as the transactions are verified by the Bitcoin mining network after the primary verifications by BitReserve.

“Because we built a cloud-based service that’s debiting and crediting money, instead having a bunch of banks and processing companies in the middle, we can do this very quickly between accounts,” Minor explained.

Minor, the founder of CNET and technology entrepreneur, has invested in a variety of tech companies, including Salesforce, Open DNS, GrandCentral, Vignette and Rhapsody. Minor is currently the second-largest shareholder in salesforce.com, a company recognized as one of the most successful tech companies of the decade. Following the success of salesforce.com, Minor built Minor Ventures, and funded companies including Grand Central Communication and Open DNS.

AlphaPoint Partners With IdentityMind To Launch Exchanges At Speed

Bitcoin exchanges are a risky business to dive into. But they're growing easier to build. Companies AlphaPoint and IdentityMind just partnered up to help Bitcoin exchanges to get off the ground in day

MAY 5 DIGEST: GBTC Begins Trading on Public Markets, Credit Card Sized Bitcoin Wallet Launches at TechCrunch Disrupt NY

The publicly traded shares of the Bitcoin Investment Trust have officially started trading on the public markets, Bitcoin startup Case has launched its Bitcoin hardware wallet on-stage at TechCrunch D

US Govt Develops a Matrix-Like World Simulating the Virtual You

Picture a parallel virtual world that collects information on our virtual identities in real time, tracks our behavior, and is smart enough to interpret this data to simulate a virtual YOU on its own.

Bitcoin Price Analysis: The 50 Day Exponential Moving Average is Big Resistance (Week of May 4)

Bitcoin Price Analysis from CoinTelegraph, Week of May 4

Monday, May 4, 2015

The Bitcoin Investment Trust’s GBTC Begins Trading on Public Markets

It has been a long time coming, but as of this morning, the publicly traded shares of the Bitcoin Investment Trust have officially started trading under the ticker GBTC. For the first time in bitcoin’s history, bitcoin can now be bought and sold on the public markets.

For the past few weeks, there have been multiple bids placed for shares of GBTC, including one by Maxim Capital for 50,000 shares at $35.00/share. However, there hadn’t been any asks, or offers to sell shares. KGA Americas was the first to place a $44.00 ask for 298 shares of GBTC, which is the equivalent to 29.8 bitcoin at around $440.00 per coin.

I might have been first to purchase $GBTC, here’s my trade stub in case anyone is a securities detective http://pic.twitter.com/FsaPg0ZlPN

— Joe Colangelo (@Itsjoeco) May 4, 2015

But with a $6.00 spread between the top bid and the lowest ask, there was still some price movement that needed to take place for an order to execute. Right around 12:00PM EST, the first reported trade went through. Originally it was believed to have been 10 shares at $38, but according to Michael Sonnenshein, the Director of Sales & Business Development at Grayscale Investments, the first trade was for 2 shares at $44/share.

@alansilbert first trade was for 2 shares @ $44.00

— Michael Sonnenshein (@Sonnenshein) May 4, 2015

The price quickly dropped down to $38, where Joe Colanegelo revealed that he had purchased 10 shares of GBTC at $37.98 through his brokerage.

I just purchased 10 shares of $GBTC at $37.98 through USAA http://pic.twitter.com/trHbpm80Wx

— Joe Colangelo (@Itsjoeco) May 4, 2015

Adam Silbert, the founder of BitPremier, also revealed that he bought shares of GBTC through his Fidelity account.

James Russell shared on Twitter that he had success selling shares of GBTC on the open market, selling 7 shares for $133.70/share. That would have meant that someone had purchased a bitcoin for about $1,337.00. He went on to share that he had sold an additional 27 throughout the rest of the day, but none of the prices showed on the GBTC asks. He did share a screenshot of his asks.

@barrysilbert @GrayscaleInvest @BitcoinTrust 7 of my 100 market-bought GBTC just sold at $133.7. Thanks for helping Bitcoin set a new ATH!

— James Russell (@Schmame) May 4, 2015

All told, it was a light day for trading of GBTC. Only 765 shares changed hands, which is the equivalent of about 76.5 bitcoin. However, this ensures that the average individual can now purchase shares of bitcoin without having to own the physical asset; further, it gives them an easy outlet for adding bitcoin to their retirement account.

Israel Is at the ‘Leading Edge’ for Bitcoin Startups

According to mathematician Meni Rosenfeld, Israel is a Bitcoin “forerunner.” With large numbers of users in the country, the number of startups and merchants continues to grow.

New Mining Chip Developed by SFARDS Becomes Most Efficient Chip Produced

A new digital currency mining chip is being released next week that the manufacturer believes will severely decrease the amount of electricity needed to mine bitcoin, an important factor for miners.

According to Marshall Long, the CTO of FinalHash, a mining consulting firm, “these new chips will allow hobbyists to get back in the game. Power to the miners.”

The new chip is being manufactured by SFARDS, a new company formed from the merger of two other Bitcoin mining companies, Gridseed and WiiBox. Gridseed was a mining chip and hardware manufacturer, while WiiBox developed software and hardware for controlling mining rigs. According to Long, Frank Li is leading the team that is bringing this chip to market.

“This chip outperforms everything on the market by about 40 percent, give or take, on the bitcoin side, and about 130 percent on the litecoin side. Plus, you can mine both at the same time,” Long said.

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The chip requires only 0.331 watts/GH, which is a measure of the electricity required to perform hashing operations. According to Long, this makes the new chip the most efficient ever produced. At the same time it mines bitcoin, the new chip will mine litecoin using 2.9 watts/MH.

Many companies have attempted to make more advanced, efficient chips, but SFARDS used an experimental technology to reach these levels. According to Long, the company used a process called Fully Depleted Silicon on Insulator, otherwise known as FDSOI.

While most chips are made entirely on silicon, this process allows for alternating layers of silicon and silicon dioxide. Long explained that this “allows you to take a design and, with no alterations in the design ,use this manufacturing process to keep the power consumption to a minimum.”

While it works in theory, no manufacturer has been able to do this method at scale, a fact Long admitted was a concern for SFARDS. “However, the 100 sample chips I saw were flawless,” he said. Long visited the SFARDS production facility in Beijing to test the chip in person and pick up some development boards.

SFARDS aims to release two production units. The first is a single chip USB miner for the average consumer who wants to experiment with mining. The second is a 16- or 24-chip full miner that is meant for enthusiasts and large-scale mining operations. Further, SFARDS plans to ship 50 development boards next week to developers who will be able to tweak the hardware to try to create an even more efficient chip.

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According to Long, the optimal setting to run the chip is at 0.062V, which allows each chip to reach the capacity of 100GH/s, coming out to the 0.331 watts/GH. Long explained that he tested the chip in an open environment which enabled the chip to remain around 49.2 degrees Celsius; however, he admitted that in an enclosed environment the heat might be much greater.

Because this chip can mine both bitcoin and litecoin simultaneously, there are two sides to it. On the bitcoin side, it has 160 processing cores, while on the litecoin side, it has 125 processing cores. It also has on-chip RAM.

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Is There Demand?

The mining industry has shrunken dramatically over the past six months due to the low price of bitcoin. On January 1, 2015, cloud mining company and GHash.IO mining pool operator CEX.IO announced that it was temporarily suspending cloud mining operations due to the bitcoin price drop. As the price has fallen lower, electricity costs and mining efficiency has become an even more important factor for miners. However, a new generation of high-efficiency chips, including this one from SFARDS, is in development.

“I have personally already talked to many major farms, and many are excited,” Long said. “SFARDS is being cautious, and batch one will be produced only in a quantity of around three petahash. And they will limit each customer to a small amount so everyone can try it out. However, big farms will be allowed towards mid-summer to order in bulk.”

Due to the chip being in the final PCB design phase, Long wasn’t yet sure what the price for the chip would be. He did say, however, that the price would be competitive and that, “I personally expect the first miners to be finished and ready to be shipped in under one month’s time from today.”

When it does launch, FinalHash, Dual Miner, and a few other distributors will be allowed to sell both units.

Bitcoin Job Fair Highlights Payroll Trends in Fintech

Accenture’s recent report projects investment in the financial tech sector to more than double in five years, from $3 billion in 2013 to more than $8 billion in 2018.

With the rise of investments comes the rise of demands for employees. The first quarter of 2015 shows a 54 percent increase of venture capital funding for Bitcoin companies, with the total sum growing from $133 million to $229 million with notable investments in both Coinbase and 21inc.

At the Bitcoin Job Fair last week hosted by the Plug and Play Tech Center, the 30 companies represented were focused on attracting and keeping the best talent. The 350 attendees were passionate about Bitcoin, and many of the job seekers were interested in being at least partially compensated in the digital currency. Many of the startups present at the job fair, including BitPay, have international employees and are seeking both domestic and international talent.

Although choices abound for human resources and payroll solutions, the biggest payroll companies with automated services in Silicon Valley such as Zenpayroll and Zenefits have not integrated bitcoin for international payments. Instead, new entrants such as full-enterprise HR solution Zuman and simple payroll services such as Incoin are integrating bitcoin payments to solve central challenges for established and growing businesses.

They seek to offer flexible choices, automation and frictionless solutions for companies of all sizes. In addition to addressing common business pain points, they hope to give additional options to savvy tech employees across the world.

Zuman, like Zenefits, is a full-on HR solution providing enterprise services taking care of compliance, tax and legal issues with prices starting per employee. On the other end of the spectrum is Incoin, a lower-cost solution providing automated bitcoin and USD payouts to companies with a U.S. bank account. Bitcoin processing for both companies is accomplished through an API provided by BitPay, an international payment processor.

“If Bitcoin companies want to retain top talent, taking measures to ensure employee satisfaction is vital,” says BitPay Marketing Manager Emily Vaughn. “Receiving all or a portion of your paycheck in bitcoin is a major benefit for tech talent, and BitPay has partnered with payroll providers to make this easy and affordable for employers.”

“Through our partnership with BitPay, we are be able to better help companies that are moving beyond their startup phase attract and retain high-value employees,” says Doug Devlin, CEO of Zuman.

Companies such as Incoin and Zuman allow companies to pay domestic and international employees in USD and bitcoin, saving real time and money for startups. They are also helping lead bitcoin adoption by allowing employees to earn bitcoin rather than forcing locals to tap into exchanges.

“Offers like this are increasingly attractive to people in countries that have a volatile local currency where binding Forex market restrictions are in place and black markets charge unheard of prices, like Argentina” says Tony Holdstock-Brown of Incoin.

According to the New York Times, the official exchange rate for the Argentinian peso can be as much as 40 percent less than the effective, black market rate (the dolar blue). Increasingly, talented and educated Argentinians are trying to buy bitcoin and even trying to earn it.

Bitcoin companies BitPay, BitPagos and Bitex all have opened headquarters in Argentina to take advantage of this demand.

Being able to earn in bitcoin lowers the barrier to obtaining bitcoin and also provides opportunities for what 21 Inc.’s Balaji Srivinasan calls “closed-loop” companies and systems that accept bitcoin as payment for goods and services. Closed-loop systems are growing extremely important in the developing world as venture capital firms incubate companies that allow locals to spend bitcoin for goods and services, such as Zapgo.co and Bankymoon.

Srivinasan highlighted a few potential issues in a presentation at the job fair. For example, closed-loop systems may push forward adoption, but adoption could also lead to a depression in the bitcoin price if individuals are forced to go to exchanges to convert bitcoin to spend fiat currency for goods and services.

The solution, according to Srivinasan, is to encourage a less volatile and valued bitcoin currency by giving individuals choice to purchase goods and services with digital currencies – especially in emerging markets such as the developing world.

Photo by Dave Dugdale / CC BY-SA 2.0

Join the #ProofOfWork 30-day Health and Fitness Challenge Powered by Bitcoin

Bitcoin is mined based on the concept of proof of work. The difficulty of proof of work and the computing power required make bitcoin special and very rare and therefore very valuable.

This concept of proof of work is integral not only to bitcoin but also applies to many facets of life. Anything worth having or accomplishing takes work, as the old saying goes. Health and fitness is no exception to this rule. Consistent habits can create an amazing body and health.

The proof of your workout is clear when you have great biceps. The only way you get those biceps is through a dedication to your goal and by holding yourself accountable.

BitPay, Bitcoin Magazine, ChangeTip and the Chamber of Digital Commerce have teamed up to sponsor a 30-day challenge to encourage fitness and health. These organizations want to mobilize their decentralized community to take up a positive challenge, hold accountability and inspire via social media tools such as ChangeTip. Getting to your goals will be made even sweeter with prizes.

Psychologists say it takes 5 days to create a habit and 21 days to cement one. Emily Vaughn of BitPay has experience joining social fitness campaigns, which encourage members to share their progress and health and fitness tips daily. When discussing parody April Fools Day Bitcoin projects with the marketing team at BitPay, the moniker “proof of workout” was born, and thus the idea of a social fitness campaign that encourages participants to prove their work and get results.

After starting the paleo diet and joining a Facebook group for local paleo dieters, she realized that sharing the ups-and-downs of a health and fitness challenge created social accountability and resulted a true lifestyle change, a success that is difficult to achieve when you go it alone. So she dreamed up #ProofOfWorkout, a 30-day health and fitness challenge. The goals of the challenge are to use fitness to educate about the social and transformative properties of Bitcoin technology, and to mobilize the Bitcoin community towards a common goal – getting fit. She designed the challenge to make it accessible to anyone. She plans to use the proof-of-work concept herself, to hack her way to better habit and eventually great fitness and inspire others to do so as well.

Join the Challenge!

Simply sign up on the #ProofOfWorkout website with your email, tell us your goal, and then start posting to social media with #ProofOfWorkout so we can track your goals and connect you with like-minded people. Signups begin today and the challenge starts on Monday, May 11^th. After 30 days, the contest concludes on June 9^th. Winners will be announced on Friday, June 12^th. #ProofOfWorkout hopes to award five $100 Nike Gyft cards to the most engaged and enthusiastic participants.

Join the #ProofOfWorkout challenge and prove your work with a strong body and a healthy mind. And maybe score some Nike gear, too!

SpectroCoin Integrates WoraPay’s Payment Network for Merchants in Eastern Europe

Through an integration of the European payment network, WoraPay, users of the London-based Bitcoin mobile wallet SpectroCoin now can spend bitcoin at numerous Eastern European merchants.

Paying merchants with bitcoin is done indirectly, however. Users’ fund their WoraPay accounts with bitcoin sent from their SpectroCoin wallets, and then pay the merchant with euros through their phone.

Though WoraPay has its own mobile wallet, the company also opened its payment network to third-party wallets. This gives other mobile wallets access to a growing number of merchants across Europe that accept WoraPay. The payment network is especially popular in Eastern Europe and only recently has got traction in Western Europe.

“[The] key requirement for currency is its liquidity. And, differently from most financial assets, liquidity of currencies is perceived not as an ability to sell or buy it, but to use it as a means of payment,” said SpectroCoin co-founder and CEO Vytautas Karalevicius. “Having more places to pay with bitcoins makes it more like a currency or method of payment and less than as a tradable asset. Furthermore, having more places to pay with bitcoin reduces the number of transactions involved as there is no need to exchange bitcoin before payment, which leads to lower cost and quicker processing.”

A Universal Bitcoin Company for Eastern Europe

SpectroCoin offers many consumer services. The company operates a bitcoin-to-cash service in Asia and Europe, a Bitcoin exchange and a merchant payment processing service. But at the core of the company’s offering is its Bitcoin mobile wallet.

According to Karalevicius, the increased number of businesses SpectroCoin users can spend their bitcoin at is crucial for convincing consumers to pay with bitcoin and the long-term viability of the digital currency.

“We have always perceived Bitcoin as a payment protocol, not as an asset class. Therefore, we position ourselves as providers of Bitcoin services to reduce bitcoin price risk rather than to sell bitcoin as an asset,” Karalevicius said. “By having more merchants accepting bitcoin without asking them to take bitcoin price, security or other risks, we make bitcoin payments much easier. SpectroCoin’s key goal is to use Bitcoin to separate three fundamental properties of money: method of account, store of value and means of payment.”

SpectroCoin mobile wallets have moved to this direction not only by WoraPay integration, but also by being the first Bitcoin company to offer the ability for its clients to pay with euros via the Bitcoin network, which means users can buy and exact amount of bitcoin when initiating a transaction and do not have to hold any bitcoin, only euros.

Though SpectroCoin offers many services, the company is focused on Eastern Europe. Among the new bitcoin-accepting merchants SpectroCoin users will be able to spend their bitcoin with are Lukoil gas stations in Estonia, Latvia and Lithuania. Other businesses include a Lithuanian taxi service, two sports areas, numerous restaurants around Europe and four e-commerce websites.

Adopting the Chain: How Tesla Could Protect Its Website and Its Cars (Op-Ed)

The domain name belonging to Tesla Motors was hijacked this past week, and visitors to the website were treated to a juvenile display of fake photos on the homepage.