The Solution to the World’s Most Toughest Bitcoin Puzzle Is as Clever as Its Creator
Last week, an enigmatic and fiendishly tricky puzzle that had baffled bitcoiners for years was finally solved. In the process, it earned the individual who cracked it a 5 BTC jackpot and brought new acclaim to the team behind the project. After being launched in 2015, at the height of the bitcoin bear market, the puzzle attracted a flurry of interest. As the months passed and no one stepped forward to claim the prize, interest in the puzzle waned, until last week’s sudden news that its mysteries had been decoded.
Also read: A Look At Service Providers and Tools Supporting the New BCH Cashaddr Format
Satoshi, Shakespeare and the $50,000 Puzzle
1FLAMEN6 was the name assigned to a notorious bitcoin address created in 2015. The notoriety came on account of the 5 BTC locked inside it. The coins were anyone’s to claim, but to unlock them they would have to solve a visual puzzle that had baffled some of crypto’s greatest minds and finest armchair detectives. The Legend of Satoshi Nakamoto is a visually rich painting by @coin_artist, who devised the board game-inspired artwork in conjunction with fellow crypto creative Rob Myers. It was evident that the painting contained clues that would reveal the key to the bitcoin wallet, but those clues were so obscure and esoteric as to thwart all attempts to crack them.
That’s until a 30-year-old programmer operating under the pseudonym of Isaac stepped forward and helped himself to the prize. Motherboard spoke to the code-cracking genius, who confessed that holding bitcoin wasn’t safe in his country, hence the desire to preserve his anonymity. Isaac only learned of the puzzle a month ago, but in three weeks made more progress than the crypto community had made in the past three years. Encoded in the painting, Isaac discovered, was the key to the bitcoin wallet prefaced by the phrase “B34u7y, truth, and rarity”, put there to signal that its finder had been successful.
17th Century Wisdom Meets 21st Century Tech
Conveniently for
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New York Wants a Piece of the Ever Growing Bitcoin Mining Pie
Watch out Canada! New York wants a piece of the bitcoin mining market, securing for its residents revenues and jobs that come along with the electricity intensive process. Bitcoin mining might even help revive local economies that once relied on polluting industries.
Also Read: Senate of Nigeria Launches Probe of Bitcoin Trading in the Country
Mining Up North
The New York Power Authority has approved the allocation of 15,000 kilowatts of hydroelectric power to a new bitcoin mining venture by Coinmint, the North Country Data Center Corp (NCDC), pending the approval of a contract within a year. Coinmint, which currently operates a bitcoin mining facility in Plattsburgh, expects that the cryptocurrency market will continue to grow worldwide and thus seeks to expand its business to a second facility.
According to the proposal plan, the power allocation would support capital investment of at least $165 million and the creation of 150 new jobs in connection with the proposed project. The plan will involve renovating a former metal smelting facility in Massena, and the installation and operation of up to 180,000 specialized bitcoin mining systems within two years. Once complete and fully operational, the NCDC expects to handle 15 percent of the global cryptocurrency business.
Cheap Reliable Power
The new bitcoin mining facility is planned to operate around the clock, and NCDC indicates it would hire 75 full-time employees in 2018 and 75 in 2019 for a total minimum employment force of 150 employees. The jobs would include security personnel, IT technicians, electricians, installers and operational staff, with an average wage of $46,000.
The proposed location for the new mining complex is just south of Canada, whose cold climate and cheap hydroelectric power are a major attraction for Chinese bitcoin miners.
What locations are best suited to win the race to become new bitcoin mining hubs? Tell us what you think in the comments section below.
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Study Finds Little Correlation Between Tether Printing and Bitcoin’s Price
Over the past few months there’s been a lot of internet chatter concerning the digital currency tether (USDT) and whether or not it’s really backed by U.S. dollars. Further, there’s been skeptics, speculators, anonymous Twitter handles, and well-researched reports that claim tether printing moved the price of BTC considerably this past year. However, just recently a Ph.D. student at the University of Groningen analyzed the situation, and his findings reveal the theory of new tethers pumping the bitcoin price looks improbable.
Also Read: Senate of Nigeria Launches Probe of Bitcoin Trading in the Country
A Statistical Point of View Doesn’t Support the Tether Printing and BTC Pump Theories
“I approached this question from a statistical point of view — If the alleged Tether strategy is true, we should see a positive correlation between the change of the amount of tethers and the change of bitcoin price at some time frames,” explains Ivanov’s analysis.
A Negative Correlation Between the Number of Tethers and the Change of Bitcoin Price
Ivanov used the historical data from BTC prices using Coinmarketcap and the number of tethers in 2017. Following this, he calculated the daily percentage change of bitcoin price and the daily change of the number of tethers in existence.
“Next, I plot the bitcoin daily percentage change in price versus the amount of tethers daily percentage change, and most of the points center around zero — Some points on the far right corner of the plot correspond to large percentage changes in the amount of tethers. These are the outliers. Interestingly, they mostly lie below zero in the bitcoin price percentage change axis,” Ivanov’s research details.
Pearson correlation coefficient for bitcoin daily price percentage change and the amount of tethers daily percentage change is -0.17168 (p-value is 0.001, which is statistically significant). So there is a negative correlation between the change of the amount of tethers and the change of bitcoin price.
The researcher then looks into whether or not tethers are used to pump BTC prices over a longer period of time. The “correlation in all cases is still close to zero” says Ivanov, and his testing does not support the claims that BTC prices are moved by USDT printing — although, Ivanov explains, his statistical analysis doesn’t necessarily fully disprove tether manipulations.
“A transparent public audit of Tether will shed light on this issue,” Ivanov concludes.
What do you think about Ivanov’s research? Do you think tethers pumped BTC? Let us know in the comments below.
Images via Pixabay, U.S. Treasury, Tether, Oleksandr Ivanov, and Forklog.
Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’s Wiki page for an in-depth look at Bitcoin’s innovative technology and interesting history.
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Major British Credit Card Issuers Ban Customers From Buying Cryptocurrencies
Britain’s largest banking group is banning its credit card customers from buying cryptocurrencies including bitcoin. Credit card issuers that are banning crypto transactions include the UK’s largest retail bank, Lloyds Bank, Bank of Scotland, Halifax, and MBNA.
Also read: Japan’s DMM Bitcoin Exchange Opens for Business With 7 Cryptocurrencies
Largest British Banking Group Banning Crypto
Lloyds Banking Group operates the UK’s largest retail bank, Lloyds Bank, as well as other well-known brands: Bank of Scotland, Halifax, MBNA, Black Horse, LDC, AMC, Colleys, Scottish Widows, Lex Autolease, and Birmingham Midshires.
From Monday credit card customers of Lloyds, which includes Halifax, Bank of Scotland and MBNA, will be blocked from buying the cryptocurrency online via a blacklist which will flag up sellers.
A spokeswoman for Lloyds confirmed to Reuters in an email that ”Across Lloyds Bank, Bank of Scotland, Halifax and MBNA, we do not accept credit card transactions involving the purchase of cryptocurrencies.”
Fear of Huge Losses
The company’s announcement came “amid fears they [credit card customers] could run up huge losses,” the publication conveyed, adding that:
The bank fears it could end up footing the bill for unpaid debt should the price fall any lower.
In addition, “Concerns are also growing that bitcoin and other cryptocurrencies are being used for drug dealing and money laundering,” the publication expressed, adding that “It is thought that other banks will shortly follow suit.”
A Global Epidemic
Several US banks have also announced a ban on cryptocurrency credit card payments. On Friday, Bank of America, JP Morgan, and Citigroup said that they would block attempts to buy cryptocurrencies using credit cards.
“Bank of America started declining credit card transactions with known crypto exchanges on Friday,” according to Bloomberg, adding that the policy applies to all personal and business credit cards but does not apply to debit cards.
In South Korea, card companies are also voluntarily blocking transactions to overseas cryptocurrency exchanges. According to Business Korea, “Card companies have adopted the system in line with the government’s efforts to tackle speculative investment in virtual currencies.”
What do you think of these credit card issuers declining crypto transactions? Let us know in the comments section below.
Images courtesy of Shutterstock and Lloyds Banking Group.
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Cryptocurrencies Are Pushing Semiconductor Innovation and Profits
Bitcoin and cryptocurrency mining has become a growing industry, and mining operations continue to compete by making faster chips and purchasing large quantities of land to host data facilities all over the world. Data recorded from around the globe shows the mining economy is booming and the venture has become very profitable for many mining operations and chip manufacturers. For instance, this week it was revealed by regional reports that the Chinese firm, Bitmain Technologies, raked in 14.3 billion yuan ($2.3billion USD) in revenue last year from sales.
Also read: Dead again? In Reality Bitcoin Is Up 729% Since Last February
Mining Proves to Be One of Cryptocurrency’s Most Profitable Sectors
Mining cryptocurrencies like bitcoin has become very profitable for those who know how to obtain cheap electricity and operate a sound business. The ecosystem has spread as Graphics processing unit (GPU), and Application-specific integrated circuit (ASIC) chip manufacturers are making lots of money from the mining industry.
Public shares from companies like AMD, the Taiwan Semiconductor Manufacturing Co (TSMC), and many others have spiked considerably this past year. It turns out, that still to this day, churning out complicated math problems to find blocks is one of the hottest sectors in the cryptocurrency space, and this phenomenon will likely continue. One example is the 16-nanometer mining chip that has been an industry standard for quite some time, but now 12nm, 10nm, and 7nm chips are coming in the near future.
China’s Two Dominant Mining Manufacturing Businesses
One firm, Bitmain Technologies, has been a top mining chip manufacturer for a very long time delivering mass-produced ASIC rigs featuring 28nm, 16nm semiconductors. A recent disclosure from China’s Digitimes details that Bitmain had reportedly ordered 100,000 12nm chips from TSMC and the order was marked “urgent.” Alongside the order, according to the publications 8BTC and Applancer, the Chinese mining firm Bitmain Technologies revenue in 2017 was 14.3 billion yuan ($2.3billion USD). The report says that “Bitmain has become China’s second largest IC design company, ranked only second to Hisilicon.” With many companies entering the industry, Bitmain is relentlessly holding its top position in the cryptocurrency mining economy.
Bitfury Is Still Dabbling In the Mining Industry
The blockchain firm Bitfury created in 2011 has said it has been making a lot of money this year as the company claims to be generating $100Mn USD annually. Although, it’s also been reported that the company doesn’t like to be referred to as a ‘mining company’ anymore, but still seems to dabble in the industry.
Nevertheless, the company still has a mining pool, but it doesn’t command the hashrate it used to years ago, capturing only 1.7 percent of the network’s processing power. Further, the company’s website sells a mobile bitcoin mining unit called the ‘Blockbox,’ and it still sells custom 16nm semiconductor chips. The company hasn’t shown any signs of designing a new semiconductor smaller than the 16nm. Bitfury has also pivoted its business in many different directions with ideas like lightbulbs that mine bitcoin, and blockchain surveillance services. At the same time, the firm has recently claimed to be building the biggest mining operation in North America.
New Fish or Sharks Will Swim Among the Whales
All of these current mining conglomerates have some competition coming soon as there are a few companies aiming to join the mining industry with superior technology. For instance, the Japanese firm, GMO Internet Inc, just recently announced the successful completion of 12nm Fin FET Compact (FFC) semiconductor chips. After completing this task, GMO says the feat has brought them closer “towards realizing a […] 7 NM process technology for mining chips.”
Another Japanese firm that is making waves in the mining industry is the e-commerce and internet conglomerate DMM Group. The firm has started its own mining operations and a “crypto mining lab” that plans to research and develop “the highest per unit hash power” in custom DMM machines.
According to reports last week, the well known Korean electronics manufacturer Samsung is entering the bitcoin hardware and semiconductor market. Allegedly Samsung’s foundry is manufacturing 10-nanometer chips for both GPU and ASIC devices.
It’s safe to say the mining industry will continue to be a very lucrative business, but there have been many failed operations along the way like Butterfly Labs, Black Arrow Software, Hashfast, Vmc, and Cointerra. Some of the older companies like Canaan and Bitmain still have to keep their guard up as new entrants come into the market with faster processors. However, the revenues and funding these existing companies received this year continues to give them a competitive edge until the newcomers prove their devices and semiconductors are what they claim.
What do you think about the competitive mining industry and how lucrative these businesses are? Do you think the new companies claiming to have faster chips will change the mining industry? Let us know what you think in the comments below.
Images via Pixabay, DMM, GMO, Atlas data, PwC, McLean Reports, Bitfury, Canaan Creative, and Bitmain Technologies.
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Most Korean Crypto Exchanges Unable to Use Government-Mandated System
The majority of cryptocurrency exchanges in South Korea are unable to use the new government-mandated system which was recently implemented. Six major banks have installed the real-name system, but only three have decided to offer the service to crypto exchanges. In addition, only the country’s top four exchanges receive this service from banks.
Also read: Japan’s DMM Bitcoin Exchange Opens for Business With 7 Cryptocurrencies
Four Exchanges Able to Use Real-Name System
It has been less than a week since the new real-name account system for South Korean cryptocurrency exchanges went into effect. From January 30, existing virtual accounts issued by banks for crypto exchanges must be converted into real-name accounts to deposit money to trade cryptocurrencies.
According to the Korean Blockchain Association, there are at least 25 cryptocurrency exchanges operating in the country. However, only Bithumb, Upbit, Coinone, and Korbit have had their virtual accounts converted into real-name ones, according to local media.
Citing that the rest of the exchanges “continue to ignore the guidelines of the real-name system,” Hankyung wrote:
The government encourages monopoly.
Service Optional For Banks
Yonhap quoted a bank official saying, “Issuing new accounts confirmed to a virtual currency exchange is a voluntary decision by the bank.” The official further explained, “banks that have legal obligations related to the prevention of money laundering only check the internal control procedures such as customer confirmation of the virtual currency exchange and the system stability, customer protection device, and anti-money laundering procedures.” The news outlet elaborated:
The new account issuance is limited to exchanges with systems that are above the specified requirements, which means that if the conditions are not met, the new real-name verification account can be rejected.
Shinhan Bank, which services Bithumb, also made a decision to temporarily exclude the exchange from its real-name account issuance process, Asia Economic reported. A Shinhan Bank official explained that the bank “temporarily suspends the issuance of [Bithumb] accounts in consideration of the fact that they [Bithumb] are being investigated by the police.” On Friday, the police conducted an on-site investigation of Bithumb to find out who hacked the exchange last year.
787,600 Users Affected
The Korean Blockchain Association estimates that there are about 787,600 customers using small and medium-sized exchanges that do not have virtual accounts, Yonhap detailed. These exchanges use corporate accounts to keep customers funds, a practice that the regulators want to eliminate, citing the high risks of money laundering. The news outlet noted:
Currently, some exchanges that have not received their new accounts have confirmed that they will suspend transactions if the same situation persists after a certain period of time.
However, the publication pointed out that the regulators said it is possible to keep using corporate accounts, providing the exchanges can properly fulfill their anti-money laundering obligations as well as confirm the identity of customers. In addition, they will be “subject to intensive checks by banks and financial authorities.”
What do you think will happen to small crypto exchanges in South Korea? Let us know in the comments section below.
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