Coinbase: Ethereum Classic Double Spending Involved More Than $1.1 Million in Crypto

Coinbase: Ethereum Classic Double Spending Involved More Than $1.1 Million in Crypto

A deep reorganization of the Ethereum Classic (ETC) blockchain, which reportedly included double spending, has involved more than $1.1 million worth of crypto, United States crypto exchange Coinbase revealed Monday, Jan. 7. According to the Coinbase blog, the team first detected eight reorganizations that included double spends, totaling 88,500 ETC (approximately $460,000). Later, the exchange informed the public in an update that there were 12 additional reorganizations, totaling 219,500 ETC (around $1.1 million). It was not immediately clear whether Coinbase has increased the number of previously detected attacks to 12, or whether there were 20 attacks in total. If they meant the latter, the amount of ETC that has been double spent could equal up to $1.5 million. As Cointelegraph previously wrote, Coinbase detected the ETC blockchain reorganization on Saturday, Jan. 5, and indicated that it was a 51 percent attack. The U.S. exchange then temporarily halted all interaction with the ETC blockchain. Coinbase states that its customers were not affected by the attack. The major exchange was soon joined by Japan’s bitFlyer, which also claimed that there was an ongoing 51 percent attack with mass reorganization involving more than 100 blocks. The exchange also suspended the deposits and withdrawals of ETC. Japanese exchange Coincheck has also temporarily suspended ETC deposits and withdrawals. ETC developers first denied the reports about a 51 percent attack, stating that double spends did not take place. However, they asked all exchanges and mining pools to significantly increase confirmation time on all withdrawals and deposits. Later, the Ethereum Classic team stated on Twitter that the increased hashrate might be attributed to the testing of new 1,400/Mh ethash machines by application-specific integrated circuit (ASIC) manufacturer Linzhi. However, they admitted that double spends also could take place: “Linzhi is testing ASICS. Coinbase reported double spends; both may be true.” Meanwhile, Wolfgang Spraul, Linzhi Shenzhen’s director of operations, denied these claims in a Tweet that has since been deleted, stating that they might be a part of the attack itself. As Cointelegraph has explained, a 51 percent attack, or majority attack, can happen when a user or a group of users that control the majority of mining power monopolize the control over the network. In this case, attackers get enough power to control…

Despite Reporting Revenue Losses, GMO Internet’s Crypto Mining Rewards Soar

Despite Reporting Revenue Losses, GMO Internet’s Crypto Mining Rewards Soar

Japanese IT giant GMO Internet Group has published the latest monthly disclosure on its in-house crypto mining operations, confirming that it took a steep hit in overall mining revenue. GMO released the disclosure in a publicly available document on Jan. 8, also revealing a steady increase in its monthly Bitcoin (BTC) mining rewards. As previously reported, GMO’s consolidated losses for Q4 2018 totalled 35.5 billion yen ($320 million), with its unconsolidated loss tallying at around 38 billion yen ($334.5 million). As a result, the firm announced it would be shutting down its hardware manufacturing business, but would nonetheless continue its in-house mining operations. These latter will be reportedly subject to restructuring, with plans to relocate GMO’s mining center to a region with lower-cost electricity supplies. As revealed in GMO’s latest monthly report, even as overall revenue from mining has tanked, the firm’s Bitcoin mining reward has consistently increased over time — from just 21 BTC in December 2017 to 528 BTC in June 2018, and then 960 BTC in December 2018. In its disclosure, the company explains that as “the market’s total hash rate decreased, so our mining share rose and our mining reward expanded.” GMO’s disclosure also give data for its hash rate, measured in PH/s — where one PH/s indicates the amount of computation is 1 peta (1,000 trillion) times per second. In December 2017, its hash rate was 22 PH/s, rising to 384 PH/s in June 2018 and 670 PH/s to BTC in December. This increase in hash rate has nonetheless stagnated over recent months, fluctuating between 674 PH/s in October, 668 PH/s in November and 670 PH/s in December. As GMO explains, increased hash rate does not necessarily lead to increased mining rewards, as “for each currency pair, profitability fluctuates and the allocation of hash rate is based on an algorithm.” The firm also gives full data on mining rewards and hash rate for the other cryptocurrency it mines, Bitcoin Cash (BCH) — which it notably apparently did not mine at all in December 2018. For BCH, mining rewards have fluctuated wildly, from 213 BCH in December 2017 to 62 BCH in June 2018, rising to 875 BCH in October before falling to 400 BCH in November. The BCH hash rate…

Canaan May Begin New York IPO by End of Q2 2019, Anonymous Sources Tell Bloomberg

Canaan May Begin New York IPO by End of Q2 2019, Anonymous Sources Tell Bloomberg

Chinese Bitcoin mining hardware manufacturer Canaan Creative is considering a new initial public offering (IPO) in New York, Bloomberg reported on Jan. 8, quoting anonymous sources. Canaan, China’s second-largest hardware player, could begin selling its shares in a private placement in the first half of this year, according to the people familiar with the matter who declined to reveal their identity. Canaan, like industry leader Bitmain Technologies, had originally planned to conduct an IPO in Hong Kong, but the $400 million plans lapsed in November. Without quoting the anonymous sources directly, Bloomberg added that “deliberations are at an early stage, and there’s no certainty they will lead to a transaction” for a NYC-based IPO. The rumors come following a tumultuous several months in the Bitcoin mining sector. Led by Bitmain, entities have seen considerable losses on the back of plummeting Bitcoin (BTC) prices and associated decreases in demand and activity. While Bitcoin’s network hashrate has since begun to recover, reports in December were widespread that Bitmain’s IPO plans, also scheduled for Hong Kong, were to go nowhere due to reluctance from Hong Kong’s stock market regulator. Bitmain is still set to lay off potentially huge numbers of employees in the short term.

Ethereum Miner Linzhi Calls Out Project Coders for Proposed ASIC Ban

Ethereum Miner Linzhi Calls Out Project Coders for Proposed ASIC Ban

Shenzhen-based miner manufacturer Linzhi has published a statement in response to a “tentative” decision, made by ethereum developers Friday, to block specialized hardware, or ASICs, from securing the platform in exchange for rewards. This would involve the implementation of “ProgPoW” in an upcoming upgrade, a code change that is optimized for graphic card, or GPU, hardware. In today’s statement, Linzhi said it was “shocked” by the move, stating, “We reject arbitrary enforcement of rules, and request clear and equal guidelines to be established for all hardware makers.” The statement continued: “Today we are calling upon the ethereum developers to publish rules and requirements for what constitutes a good ProgPoW ASIC maker.” Elaborating on the statement in an email to CoinDesk, director of operations Wolfgang Spraul said that such rules could include more transparency, or even monthly audits of hardware companies by ethereum developers. “The rules should probably include defining better relationships between hardware makers, miners, and developers,” Spraul said, “That’s up to the ethereum developers to define, we think.” Following the meeting on Friday at which the developer’s approved the proposal, discussion regarding ProgPoW has escalated, with several prominent community members coming forward to argue against the change. ASICs for ProgPoW? Linzhi is currently designing a chip for ethereum’s current mining algorithm, Ethash. Having expended $4 million on its production, the upcoming miner claims significant advantages over former ethereum ASIC designs. In conversation with CoinDesk, Spraul also said that pending its implementation into ethereum, the company will research the feasibility of building specialized ASIC hardware for ProgPoW. “I can publicly confirm today that we intend to study the feasibility, and then build, ProgPoW ASICs,” Spraul said. Because ProgPoW changes ethereum’s underlying mining algorithm, Ethash, to be more memory-heavy, the code switch is said to make GPU hardware competitive with ASICs. Proponents of ProgPoW say that if hardware designers try to build ProgPoW ASICs – which is to say a specialized chip with the sole function of computing ProgPoW – it would just end up resembling GPU hardware. Still, Spraul denied this, stating that “Hardware innovation is non-linear,” and “We can accelerate ProgPoW by a factor of 3x to 8x.” Yesterday, ethereum classic underwent a 51 percent attack – something that the cryptocurrency’s Twitter account claimed may…

Blockchain Water Purifier? New China Mobile Appliance Earns You Tokens

Blockchain Water Purifier? New China Mobile Appliance Earns You Tokens

Telecommunications giant China Mobile is trying to show everyday consumers the value of blockchain by incorporating the technology into an ordinary household product. The company’s internet of things (IoT) unit has developed a water purifier with a built-in computing chip and an IoT module. Like other IoT-connected devices, it will collect data on user behavior, which will be valuable to manufacturers and suppliers. But according to Xiao Yi, a product market director at China Mobile IoT, this smart appliance will stand apart from most by giving consumers something in return for their data – and that’s where blockchain comes in. Depending on how long and how frequently consumers use the product, they will earn a blockchain token called PWMC, which they can then redeem for replacement filters, or to purchase other goods. This rewards system will provide an incentive for usage that’s lacking in other IoT products, Xiao said, while at the same time make blockchain relatable for the average person who doesn’t spend all day trading cryptocurrency. “Our goal is to also attract those who are not in the cryptocurrency or blockchain community, who may have heard of this technology but not necessarily understand it,” Xiao told CoinDesk, adding: “To embrace a more mainstream adoption, we need to turn something that appears professional into something that’s very ordinary.” To be sure, the water purifier is far from a mass-market product. Right now, it is available only through a one-month crowdfunding campaign on Chinese e-commerce giant JD.com, with a goal to raise 200,000 yuan or $30,000 by Jan. 21. (Buyers will receive only the device; the tokens must be earned by using it.) The sale is being conducted by Chain Infinity, a company based in Guangzhou that was jointly created by China Mobile’s IoT division, as well as Jingtum and MOAC, two China-based blockchain startups. The project was initiated around the end of 2017. Aside from incentivizing user participation with tokens, Xiao said a key purpose for China Mobile IoT to move into blockchain is the technology’s unique feature of recording data in a tamper-proof fashion. The devices feature both computing chips and IoT modules so that they’re connected to the internet without relying on wi-fi, and can run as individual nodes so that consumers’…

The Daily: Binance Adds Stablecoin Pairs, Tzero Patents Integration Platform

The Daily: Binance Adds Stablecoin Pairs, Tzero Patents Integration Platform

The Daily Cryptocurrency exchange Binance is opening trading for three stablecoin pairs. Also in Tuesday’s Daily, Overstock’s Tzero has patented a solution to integrate traditional and cryptocurrency trading systems, Morgan Creek founder Jason Williams offers his Lamborghini for bitcoin, and in Brazil, crypto investors are looking to buy vaults to safely store their digital assets. Also read: Epic Founder Addresses Fortnite Crypto Rumors, Robinhood Recruiting in London Binance Launches Trading for Three Stablecoin Pairs Binance, currently the largest crypto exchange by daily trading volume, has announced it’s adding new trading pairs that will allow users to trade stablecoins against one other. Starting from Tuesday, Jan. 8, the following pairs will be available to traders: PAX/TUSD, USDC/TUSD and USDC/PAX. In November, the digital asset trading platform rebranded its USDT market as a combined stablecoin market, introducing the symbol USDⓈ. The exchange explained this was done to support more trading pairs with different stablecoins offered as a base pair. Later Binance added to the new market pairs with the stablecoins paxos standard (PAX) and USD coin (USDC). Last year saw the arrival of several stablecoins that are now competing with the dollar-pegged tether (USDT). These include the two tokens that were approved by the New York State Department of Financial Services in September, gemini dollar (GUSD), and paxos standard (PAX), also backed one-to-one with U.S. fiat currency. Tzero to Integrate Traditional Trading Systems and Crypto Exchanges Security token trading platform Tzero, a subsidiary of Overstock, has secured a patent for a platform that allows integration between traditional trading systems and digital asset exchanges. Tzero’s Crypto Integration Platform is designed to serve as an interface between the two types of systems. According to the filing, the platform can host initial public offerings (IPOs) and offerings of securities registered with the U.S. Securities and Exchange Commission (SEC). It is also intended to be used to trade these securities in secondary market transactions. The “digital transactional items” mentioned in the patent represent tokens, securities, digital assets, digital shares, and cash equivalents. When receiving an order, the platform is expected to verify the availability and determine the best market price of the digital asset before a transaction is made. Online retail giant Overstock is a crypto-friendly company. Recently it announced it will…

BIS: 70% of Central Banks Involved in CBDC Research, Only Several Have Concrete Plans

BIS: 70% of Central Banks Involved in CBDC Research, Only Several Have Concrete Plans

A new report published on Jan. 8 by the Bank for International Settlements (BIS) has found that seventy percent of central banks worldwide are conducting research into central bank digital currency (CBDC) issuance. However, concrete plans for implementation and motivations vary considerably across contexts. The BIS is an organization based in Switzerland made up of 60 of the world’s central banks, and has to date devoted a number of major reports to both decentralized cryptocurrencies and CBDCs. The latter are distinct from the former in that they are digital currencies issued by a central bank, whose legal tender status depends on government regulation or law. As the BIS outlines, CBDCs are classed as either “wholesale” — i.e. restricted-access digital tokens for wholesale settlements such as interbank payments and securities settlements — or “retail.” The latter category is further subdivided by BIS into “general purpose” and “account-based” — i.e. those extensively available and aimed at retail transactions — or “general purpose” and “token- or value-based.” These are a form of central bank-issued digital cash available for the general public, which has similar availability to an account-based retail CBDC, but is distributed and transferred in a different way. The BIS’ survey studied 63 central banks worldwide, 41 of which are based in emerging market economies (EMEs), and 22 of which are in advanced economies — together representing almost 80% of the world’s population and more than 90% of its economic output. Of these, 70 percent were found to be already engaged — or soon to be — in theoretical CBDC research, a slight increase over 2017. Among banks engaged in CBDC research, around half have reportedly moved to experiments and hands-on proof-of-concept work — a 15 percent increase over 2017 — although many of these PoCs are notably analytical in nature and do not indicate concrete CBDC issuance plans. Only five central banks have actually progressed to running CBDC pilot projects. The BIS’ report isolates Sweden and Uruguay as two exceptional jurisdictions in which active consideration of issuing a general purpose CBDC as a complement to cash is at an advanced stage. In Sweden’s case, the country’s Riksbank has been working on an e-Krona project as of early 2017. Sweden is reportedly now ahead of its next…

Brazil: Government Suspends Indigenous Crypto Plans, New President Criticizes Project

Brazil: Government Suspends Indigenous Crypto Plans, New President Criticizes Project

Jair Bolsonaro, the new Brazilian president who has officially taken office a week ago, has criticized a project offering to create a cryptocurrency for indigenous people in a Jan. 7 tweet. Bolsonaro claimed that the new government will soon open “a black box” — a reference to an airplane’s flight recorder — of contracts and projects by state-owned economic development bank BNDES and other institutions. He mentioned that the recent project aiming to create a digital currency for the native population of Brazil has already been cancelled by the government. According to local daily newspaper Estadao, just a few days before previous president Michel Temer left office, the National Indian Foundation of Brazil had signed a crypto-related contract with public higher education institution the Fluminense Federal University. The project required the solicitation of R$44 million ($11.7 million) from the federal budget. As per local crypto outlet Portal do Bitcoin, the contract, among other things, offered to create a cryptocurrency that could circulate among the indigenous population of the country. The budget thus included articles on a feasibility study and development of the platform for the cryptocurrency. However, on Jan. 3,  the government suspended the project, as the contract was issued improperly and lacked technical analysis, such as a detailed description of the project, Brazilian newspaper O Globo reports. The contract for the project was allegedly signed directly between FUNAI and UFF, instead of legal bidding process. Moreover, the government considered that the contract had been approved too quickly and entailed considerable expenditure. BNDES, a bank associated with Brazil’s Ministry of Development, Industry and Trade, is responsible for long-term projects aimed at developing the country. As Cointelegraph Brazil reported in mid-December, the institution also considered launching a stablecoin tied to the Brazilian real to track public money transactions and enable greater transparency for the country, which has long been combating public corruption. The so-dubbed BNDES token, based on Ethereum blockchain, was scheduled to launch in 2019. As of press time, it was not immediately clear whether the stablecoin project has also been suspended by the government.

Bitcoin Miner Maker Canaan Considering New York IPO: Report

Bitcoin Miner Maker Canaan Considering New York IPO: Report

China-based Canaan, one of the biggest manufacturers of bitcoin mining chips and devices, is reportedly considering an initial public offering (IPO) in the U.S. A Bloomberg report on Tuesday, citing people with “knowledge of the matter,” said that Canaan’s IPO could be launched in the first half of this year in New York, although the process is still in its early stages. Canaan had been seeking to go public in Hong Kong to apparently raise about $1 billion, filing for an IPO in March of last year. That plan, though, has been abandoned, Bloomberg said. The firm’s Hong Kong Stock Exchange (HKEX) application lapsed in November. Major mining firms Bitmain and Ebang also filed IPO applications with the HKEX in September and June of last year, respectively. Neither has received any approval to date. The HKEX is apparently reluctant to approve Bitmain’s IPO. Last month, a person involved in the talks told CoinDesk that the exchange is “very hesitant to actually approve these bitcoin mining companies because the industry is so volatile.” Ebang, on the other hand, refiled its draft IPO prospectus last month, but stated it has seen “significant decreases” in revenue and gross profit in Q3 2018. New York image via Shutterstock 

Africa Needs Open Currency Competition. It Needs Cryptocurrency

Africa Needs Open Currency Competition. It Needs Cryptocurrency

Terence Zimwara is a cryptocurrency enthusiast and economic analyst from Zimbabwe, with firsthand experience of his country’s record hyperinflation. Terence also likes to share his views via his blog. The following is an exclusive contribution to CoinDesk’s 2018 Year in Review. As digital currencies gradually gain traction, a counter narrative emerged as the year progressed: central banks that belatedly acknowledged the value of cryptocurrencies now want to launch their own. However, some want the prerogative to issue this currency assigned to them and only them, because central banks ‘enjoy the confidence’ of the public. Speaking at a Brookings Institute organized discussion event, Agustin Carstens, General Manager of the Bank of International Settlements, boldly declared earlier this year that technology cannot substitute for all what central banks do to make trustworthy currencies. This kind of pushback against cryptocurrencies has long characterized the debate on bitcoin, blockchain and digital currencies. At the core are two fundamental issues, control and freedom to choose. Central Banks naturally want to perpetuate the status quo because of the obvious advantages this comes with that status. Yet, cryptocurrency’s popularity stems from the ease with which it enhances commerce, and the insulation it offers to investors’ value when financial markets hit turbulence. Perhaps banks would not gripe as much as they are doing now, if bitcoin did not threaten to shred the currency-issuing monopoly they presently enjoy. The power that comes with monopoly over creation of money is unmatched and that is why virtually all central banks insist on having the sole rights to print money. On the other hand, blockchain technology is a natural reaction to years of this unjust state of affairs. Blockchain technology is an attempt to force sweeping reforms to the global financial system. Therefore, it is also important to keep the latter perspective when discussing the pros and cons of cryptocurrencies. When central banks say they want to issue their own digital currencies, we have to invoke the context we have just explained above. In fairness, central banks in advanced economies across the EU, the U.S. Federal Reserve, Bank of Japan etc, sometimes do genuinely try to protect their respective citizens from hackers, fraudsters or from any other undesirable elements that may want to do harm. Central banks also claim…