How Bitcoin Cash Can Avoid the Same Mistakes as Bitcoin Core

The bitcoin cash (BCH) community understands key principles: Bitcoin should be a peer to peer Electronic Cash system; most users can use SPV wallets instead of running their own node; "second layer" scaling solutions are often unnecessary and problematic. While important, and it places the BCH ahead of others, education isn't only about the scaling debate. It's important to understand all aspects of Bitcoin.

Bitcoin Cash Knowledge is Power

If I were to ask a question: "Why did Bitcoin (BTC) fail its mission to become Peer to Peer Electronic Cash?" — you would likely hear many answers.

Some would say "censorship". Others would point to "centralization of protocol development" or "apathetic, complacent miners"… or even "Nakamoto Consensus doesn't work".

Those answers may be correct to a certain degree. I'll address each of them throughout this series, but there's an overarching principle that connects all of these.

And that principle is this: Not enough people in the Bitcoin community actually understood how Bitcoin is supposed to work.

I say that humbly — it's not that I'm so smart that I can explain how it's all supposed to work, but here's the point: Bitcoin is like a school of fish. We all have to be swimming together. Maybe not in perfect unison, but at least in the same direction.

Isn't it amazing how a school of fish can move together with coordinated body positions and synchronized movements? Scientists do not fully understand it, but it's believed to be rooted in genetics.

So how can we, the BCH community, be like the school of fish, and move together toward our destination without getting chewed apart by predators? Ultimately it boils down to this: Knowledge is power. The most important tool for liberty has always been a well informed populace.

Another word that means the same thing, is: Education.

A Deeper Problem than the Blocksize Debate

Many in the BCH community understand key principles… like how Bitcoin should be a peer to peer Electronic Cash system. Or that most users can use SPV wallets instead of running their own node. Or that "second layer" scaling solutions are often unnecessary and problematic.

Those things are very important. By understanding those (and other) fundamental principles, the BCH community is already well ahead of other communities, and that understanding goes a long way toward the goal of all swimming in the same direction.

But education shouldn't stop with knowledge of the scaling debate. We should understand all aspects of Bitcoin. Technical, economic, social… everything. The more we know, the better prepared we'll be against whatever form a future spectre takes to try to destroy Bitcoin.

As individuals, we should first take the responsibility to educate ourselves, and then educate others. And, perhaps education about the importance of education is the widest-scope principle we can formulate. It's a meme-worthy idea.

In Part 2, we'll take a closer look at consensus, decision making, and the social aspect of Bitcoin.

Written by Jonald Fyookball

Jonald Fyookball (pseudonym) is a cryptocurrency enthusiast, best known as the project leader of the Electron Cash wallet, and for a series of hard hitting articles on the Bitcoin scaling debate. Jonald is a computer scientist, businessman, investor, libertarian, and Bitcoin advocate.

Nasdaq CEO Says Company ‘Open’ To Becoming Crypto Trading Platform When Market Matures

The CEO of Nasdaq said that the stock market could become a platform for trading cryptocurrencies in the future, if the market becomes more regulated, CNBC's Squawk Box  reports Wednesday, April 25.

Nasdaq CEO Adena Friedman said during an interview that "certainly Nasdaq would considering become a crypto exchange over time." Friedman believes that cryptocurrencies "will continue to persist," the only caveat being the amount of time it will take for the crypto sphere to mature. Once that kind of institutional regulations set in, according to Friedman, Nasdaq can say:

"'It's time, people are ready for a more regulated market, for something that provides a fair experience for investors."

Nasdaq has already entered the crypto sphere, as earlier today the stock exchange and the Gemini crypto exchange owned by tech investors the Winklevoss twins announced a partnership. Gemini will be able to use the Nasdaq's SMARTS Market Surveillance Technology to alert the exchange to suspicious trade behavior, potentially preventing market manipulation.

Friedman also told NBC that she considers Initial Coin Offerings (ICO) to be securities, a point much debated in the crypto world:

"ICOs need to be regulated. The SEC is right that those are securities and need to be regulated as such."

The US Securities and Exchange Commission (SEC) launched a cryptocurrency probe earlier this year. The SEC and the Commodity Futures Trading Commission (CFTC) had also held a cryptocurrency hearing that concluded that while ICOs needed stricter regulations, cryptocurrencies needed smart policies to promote innovation.

Indian Exchange Takes Central Bank to Court Over Bank Ban

The Indian bitcoin community keeps fighting for their rights to operate freely in the country like any other industry. The latest show of defiance is a petition to the court against the actions of the Reserve Bank of India by the operators of a local exchange.

RBI Ban Unconstitutional

Indian Exchange Takes Central Bank to Court Over Bank BanKali Digital Eco-Systems, the company behind the upcoming cryptocurrency exchange Coin Recoil, has appealed to the High Court in Delhi against the recent crackdown on banks providing services to bitcoin related companies by the Reserve Bank of India (RBI).

According to the petitioner, the RBI directive is arbitrary and a violation of the Constitution of India and the court should therefore quash it. The document presented to the count, which news.bitcoin.com has obtained, explains that due to the RBI Circular the company will not be able to secure banking services that are imperative for the business' operations rendering it "stillborn." It argues that the ban is unconstitutional on two main grounds.

Freedom of Occupation

Indian Exchange Takes Central Bank to Court Over Bank BanArticle 19 of the Constitution of India guarantees citizens' rights to carry on any occupation, trade or business. But by preventing exchanges' access to baking services the government is in affect preventing people from engaging in the business of their choice.

Article 14 prohibits discrimination based on arbitrary and unreasonable classification. The petition explains that the RBI did not provide a clear definition of what constitutes 'virtual currency' and that this ambiguity dilutes any reasonability in what may be alleged as a classification. For instance, reward points such as airline miles may also be unreasonably construed as virtual currencies.

Two months ago the Supreme Court of Israel issued an injunction order forbidding one of the biggest banks in the country from halting the account activity of a local bitcoin exchange. This was a major victory for the Israeli cryptocurrency industry that set a precedent for other bitcoin businesses struggling to get banking services in the country. Hopefully the Indian high court will follow this example, even though there is a difference between the authority of a commercial bank and a central bank. Meanwhile, over 42,000 Indians have now signed an online petition that against the RBI directive.

Kraken Ends Trading Services in Japan

Kraken, one of the longest-operating cryptocurrency exchanges in the world, is pulling out of Japan. Kraken attributed the exit to the rising cost of doing business in the country, but said that it might return in the future. The exact dates for suspending trading and funding have not been determined yet, and the San Francisco-based exchange promised to contact its clients residing in Japan when this happens.

THE EXODUS FROM JAPAN

Japan has been a pioneer in the cryptocurrency industry, having been the first country to recognize Bitcoin as a legal mode of payment. However, the script has been gradually changing since the hacking of the Coincheck exchange, which saw over $500 million worth of crypto stolen. The nation's Financial Services Agency has since clamped down on many crypto exchanges, which has led to the closure of a couple of them including Mr. Exchange and Tokyo Gateway.

Perhaps the biggest exchange to come under scrutiny from the FSA has been Binance, the world's largest crypto exchange by daily trading volume. Binance had been operating in Japan ever since China outlawed crypto exchanges but was unable to secure a license with the FSA. This has led the exchange to seek alternative locations in which to set up operations, with Malta being the preferred option. According to Japanese media reports, the FSA feared that Binance did not have adequate control measures in place to prevent illegal activities, especially given its large anonymous crypto holdings.

SHIFTING FOCUS TO OTHER AREAS

According to Kraken's statement, which was leaked on Twitter, the suspension of services for Japanese residents will allow the company to shift its focus to other geographical areas and use its resources to improve its services in those areas.

The statement also expressed the company's regret at having to suspend its services for Japanese residents, having served them since October 2014, as well as its hope that in the future, it will reintroduce its services in Japan. However, the consideration of revenue against the costs required to maintain services made it impractical to continue offering them at this time.

While no official dates were offered, the statement indicated that the last day for deposits would be in mid-May, while the last day of trading would be in mid-June. The last day of withdrawals was indicated as being towards the end of June. The suspension of service only affects residents of Japan and will not affect Japanese residents or businesses that are domiciled outside Japan.

Bitcoin Cash Price Technical Analysis – BCH/USD Could Test $700

Bitcoin Cash Price Support

There was a decent start of an upside wave from the $625 swing low in bitcoin cash price against the US Dollar. The price traded above the $640 and $650 resistance levels to move back in a positive zone. More importantly, the price is now well above the $640 pivot level and the 100 hourly simple moving average. It recently traded as high as $676 before a minor downside correction.

Key Points

Bitcoin cash price is moving higher and is currently placed above $650 against the US Dollar.

Yesterday's highlighted connecting bullish trend line with support at $650 is intact on the hourly chart of the BCH/USD pair (data feed from Kraken).

The pair is showing bullish signs and it seems like it could break $680 to test the $700 handle.

Bitcoin cash price is gaining pace against the US Dollar. BCH/USD is likely to accelerate higher as long as it is above the $650 support level.

It tested the 23.6% Fib retracement level of the last wave from the $625 low to $676 high. However, the downside was limited and it seems like the price is about to resume its uptrend. A break above the $676 high could push the price towards the last swing high at $685. Above the mentioned $685 level, the price may even test the $700 resistance in the near term. On the other hand, if there is a downside correction, the $650 support may stop losses.

Bitcoin Cash Price Technical Analysis BCH USD

Moreover, yesterday's highlighted connecting bullish trend line with support at $650 is intact on the hourly chart of the BCH/USD pair. Therefore, the pair remains supported on the downside above the $650 level and it could continue to move higher towards $700.

Looking at the technical indicators:

Hourly MACD – The MACD for BCH/USD is moving nicely in the bullish zone.

Hourly RSI (Relative Strength Index) – The RSI for BCH/USD is currently near the overbought levels.

Major Support Level – $650

Major Resistance Level – $685

Bitcoin in Brief Thursday: Crypto Winter Is Almost Ove

Could this year's crypto winter be nearing an end? That's the opinion of some experts, and while bullish predictions are easy to come by, there are signs that a thaw could be underway. In today's Bitcoin in Brief, we examine the market forecast for the weeks ahead.

Bears Abate While Bulls Congregate

While market uncertainty has persisted for weeks, a few experts have felt bold enough to pop their heads above the parapet and predict the worst is over. On Monday, Crypto Asset Management's Timothy Enneking asserted that the bull market has largely run its course. On crypto Twitter, many traders are also cautiously optimistic. For the first time in a long time, they've actually begun sharing calls with their followers, something they'd hitherto been hesitant to do.

Bitcoin has scarcely moved in days, but altcoins, including ethereum and NEO, have started to show green shoots, and EOS is positively blossoming, up 27% in 24 hours. That being said, it's too early for celebrations. As one trader sagely put it, "The markets will bounce when everybody stops celebrating every single green candle and random shitcoin spike."

Bitfinex Dispels Money Laundering Rumors

Bitcoin in Brief Thursday: Crypto Winter Is Almost OverNo crypto exchange wants to be mentioned in the same breath as "money laundering", and even if those rumors are false, they need to be addressed. Bitfinex has asserted that there is no connection between it and the shell companies alleged to have been involved in laundering money in South America. Polish media had reported how Polish authorities seized $371 million linked to companies associated with Colombian cartels, and alleged a Bitfinex link, something the exchange has strenuously denied.

Litecoin Is Getting a Debit Card

Crypto debit card Tenx recently integrated litecoin into its wallet, and Charlie Lee now claims a dedicated litecoin debit card will be next, also coming courtesy of Tenx. If so, LTC will be following in the footsteps of BTC and BCH in getting its own crypto card. The news will help atone for the collapse of Litepay, a litecoin payment processor that folded due to impropriety on the part of its CEO.

Asicboost Adoption Receives a Boost

ASIC miners are controversial for a number of reasons, and so is the patented Asicboost technology that a number of mining pools have now adopted. Asicboost can improve mining performance by up to 20%, and there's now an easy way to track its prevalence among newly mined bitcoin blocks. Asicboost.dance is a block explorer that records instances of the overt "version-rolling" Asicboost in action. In related news, Samsung is reported to be developing 10nm chips for Halong Mining to use in its ASICs. Big if true.

Gavin Andresen and Craig Wright Part Ways

Bitcoin in Brief Thursday: Crypto Winter Is Almost Over

Gavin Andresen

The act of one bitcoiner unfollowing another on Twitter ought not to be news, and yet Gavin Andresen's decision to unfollow Craig Wright has got people talking. It was Andresen who first met with Wright in 2016 and "confirmed" that the Australian was Satoshi Nakamoto – a decision Andresen later rescinded and expressed regret over. Andresen's simple act of unfollowing may indicate their already strained relationship is over.

Bitcoin Is Not a Bubble

December's insane price run aside, bitcoin has been going steady for some time now. Or at least it has if you remembered to zoom out. Tetras Capital's Brendan Bernstein just went on a tweetstorm to explain his reasoning why bitcoin is not in a bubble – unlike the government-controlled fiat markets. The entire thread is worth a read, but we'll leave you with this tweet to ponder:

Bitcoin vs Oil and Gold: There Is a Difference

It's an easy comparison to make: Bitcoin mining versus gold and oil extraction. All – in the abstract sense for bitcoin – involve unearthing resources, all have had bumpy price histories, and all have been labeled as disruptive in their time.

Gold vs Oil vs Bitcoin

There are crucial differences between the three assets, especially when it comes to tracking what happens to supply after an increase in price. Twitter user @WallSt_Dropout produced a series of fascinating charts that help illustrate those differences perfectly.

First, oil. As the price of oil starts to climb, there's a marked response in oil production. Why? Because now there's extra incentive to invest in infrastructure/extraction capabilities.

As oil production begins to outstrip demand, there's a drop in the price of oil. It's now not as profitable to remove quite as much oil as before, so production eases off. As oil prices start to recover – thanks to restrictions in supply from the last cycle – the drillers turn their machines back on and produce more of the black stuff.

The same applies to gold. Beginning in 2008, monthly gold ore production is low, thanks to consistently low prices in the previous decade. As market forces begin to push the price of gold up – remember that financial crash? – production ramps up to keep track of prices. As gold prices take a dip in 2012, ore production levels off.

In bitcoin's case, the opposite is true. In 2010, when the block reward for production was higher, prices were low. As prices have climbed, the rewards for mining have dropped off. There isn't the same cyclical relationship between supply and demand found in oil and gold.

Bitcoin Is different

This is a key function of how bitcoin works. The bitcoin block mining reward halves every 210,000 blocks. At present the coin reward is 12.5 coins. According to Bitcoinblockhalf.com, by May 2020, the reward will drop to 6.25 coins.

How will miners make money after the block rewards end in 2140? Transaction fees. Gold miners don't control the buying and selling of the product, whereas bitcoin miners charge transaction fees for the confirmation work they complete. It would be the equivalent of an oil platform charging individuals a small fee for the oil they use in their cars.

It's a necessary part of the system. Think of it as miners creating a fixed amount of land every 10 minutes. People who want to make a transaction bid for a slice of that land. The sale of that tiny portion of land is what keeps miners mining.

As the Bitcoin inflation rate steadily trends downwards, the necessity of transaction fees to incentivize miners to keep mining will go up – in the far future.

Oil and gold are commodities that have no 'real' end date, i.e. there are still resources lying beneath the ground. Despite fears of peak oil and peak gold, companies keep finding more of the stuff as technology allows them to pinpoint their location and extract it with greater accuracy.

We already know how much bitcoin is left to be mined. Which makes bitcoin mining a very different proposition than mining other real world commodities.

New Local Crypto Street Exchange Shop Trades Bitcoin for Cash in Central Moscow

A change bureau trading bitcoin has been opened in the Russian capital. According to local media, this is the only currency exchange in Moscow buying and selling cryptos for cash. Lawyers say nothing in the law prohibits this kind of service, and the business is legal. 

Bitcoin Sold for Cash

Russian authorities have not regulated cryptocurrencies yet, but Russians are already adopting them. A new bitcoin change has been opened recently, not far from one of Moscow's main railroad stations, Kursky Vokzal. According to media reports, the bureau is the first of its kind in the Russian capital.

Sbercoin

The exchange is trading only bitcoins for Russian rubles in cash. Customers can buy and sell the cryptocurrency if they present an ID. The management claims that their business complies with current Russian laws. The bureau is located on the "Verhniy Susalniy" street. Other offices will be opened at two other locations, the business centers "Moscow City" and "Rumyantsevo", Bitfin reports.

Cryptocurrencies are not considered legal tender in Russia. A draft law to legalize crypto-related activities, like initial coin offerings and mining, has been introduced in the Duma by the Ministry of Finance. Another bill, co-sponsored by the parliament speaker Vyacheslav Volodin, aims to regulate the use of "digital money" and protect "digital rights" of investors. The new legislation should be adopted by July.

The circulation of cryptocurrencies and their use for payments have divided government institutions. The Finance Ministry wants to legalize their trade on registered exchanges but the Central Bank has opposed the idea. There have been calls for an outright ban on cryptocurrencies by officials who consider them illegal money surrogates. On the other hand, the current legislation does not explicitly prohibit cryptocurrency operations like exchange services.

Well, If It Isn't Banned…

"In any democratic society, including Russia, if something isn't banned, it should be legal," said Vladimir Yurasov, managing partner at a Moscow-based law firm. "The federal legislation has no provisions prohibiting the use of bitcoin in financial transactions. The purchase and sale of bitcoin do not violate the Civil Code", he told BFM. If there is no criminal offense, these activities are legal, the lawyer added. Russians can buy bitcoin, both on the internet and on the street, Yurasov said.

Sberbank

The branding of the new crypto exchange, however, is a bit misleading. The office of "Sbercoin" resembles that of a Sberbank branch – similar name, the same green colors. The state-owned Russian "Savings bank" is among the biggest in Europe. Despite its interest in cryptocurrencies, it certainly has nothing to do with the small change tucked between a grill and a tobacco shop.

According to Vivalacloud, Sbercoin also offers its customers a contract for some of its services. It comes with a plastic card showing a public key to a new crypto wallet. A private key is provided in an envelope – only you will know it… and Sbercoin, of course. Remember, Bitcoin has its "dos" and "don'ts"!