bigstock-Gold-Bitcoin-Crypto-Currency--213810058

2018 was epic. It started with the madness of altcoins rally at the beginning of the year. Followed by massive steps towards bitcoin and crypto mass-adoption made by regulators, large enterprises, and institutional investors. 

And it ended with the blood and tears of traders on the streets (we can still hear some of them screaming). 

Block Explorer is willing to reflect on the most important events that brought the industry to its current state. So, here are the major crypto announcements that shaped 2018: 

1. January: The Perfect Month to Ban Something

Bitcoin price: $14,112 (on the first of the month)

The beginning of January was marked by the huge news splash made by the South Korean government. They unveiled plans to ban anonymous trading on cryptocurrency exchanges over tax avoidance. And sent the police and tax-collecting authorities to their offices. 

As a result, the bitcoin price decreased by $2,000.

At the end of the month, crypto was in trouble again, as Facebook decided to ban all ads related to digital currencies. Since Facebook marketing was a major driving force for many initial coin offerings (ICOs), it cut the source of easy promo for many blockchain startups. 

2. February: China and Bankers Join Forces Against Bitcoin

Bitcoin price: $10,264

It’s not easy living in China without the freedom of internet browsing, catching up with friends on Facebook or just googling. All of that is restricted by the “Great Firewall of China.”  At the beginning of February, the list of undesirable foreign websites was supplemented with bitcoin-related websites to eliminate the financial risks for Chinese citizens.

Next, the head of the Bank for International Settlements (BIS) called bitcoin “a bubble, a Ponzi scheme, and an environmental disaster”. The media went nuts over it, and the more they referred to it in the following articles the more the price of crypto was sliding down, falling as much as 14% in one day. 

3. March: SEC has a Crush on Crypto Exchanges. Google Doesn’t

Bitcoin price: $10,433

Some more heartbreaking and uncomfortable milestones for bitcoin and crypto included the U.S. Securities and Exchange Commission (SEC) announcement made in March. They obliged all cryptocurrency exchanges to go through the registration procedure through the agency. 

One week later, news from Google set an overall moody tone of the blockchain scene: the company joined Facebook to ban all cryptocurrency-related ads. 

google bans crypto ads

4. April: India Joins the Strike Against Bitcoin 

Bitcoin price: $7,030

In April, crypto’s misadventures continued. This time the Central Bank of India (The Reserve Bank of India) banned financial institutions from allowing transactions from people’s accounts to bitcoin wallets. 

5. May: Goldman Sachs is Going Crypto, “Rich Dudes” are Boiling Over

Bitcoin price: $9,037

A little happy bitcoin rally happened when it was uncovered that Goldman Sachs had its own team dedicated to entering the crypto market. 

Although some people were are not happy about it. Including some very “rich dudes” that were on a mission to come up with the most-quoted insult for bitcoin. For instance, well-known billionaire value investor Warren Buffett referred to bitcoin as “rat poison squared,” and Bill Gates, one of the kindest billionaires in the world, labeled it a “greater fool theory”. 

Later this month the U.S. Justice Department started an investigation into bitcoin price manipulation. Oh, boy, it’s getting tougher.

But even in spite of all those troubles, crypto was still on a good path to wider acceptance. Or how else could you explain the 25 million crypto wallets registered at blockchain.com?  

6. June: Facebook is Stricken by FOMO  

Bitcoin price: $7,519

In June it was time for more bad news. It’s never enough in the crypto world. A panic sell-off happened in the first half of the month after Coinrail’s hack announcement. Even though this South Korean exchange was relatively small it led to a rapid 10% drop in bitcoin price. 

A couple of weeks later, big news came from Facebook who decided to reconsider the crypto advertising ban. Promoting initial coin offerings was still off the table though. 

7. July: Winklevoss Twins Keep Being Stubborn With SEC

Bitcoin price: $6,366

July was relatively calm for cryptocurrencies. Probably because most of the troublemakers were on vacation. But some news was still in the air, including the fact that asset-management heavy-weight BlackRock was looking into crypto assets and another SEC rejection of exchange-traded fund (ETF) proposal filed by Winklevoss twins. 

8. August: Too Many Rejections of ETF Proposals

Bitcoin price: $7,634

August was all about ETF proposals, their postponing and rejections. The bitcoin exchange rates struggled at first, but at the end of the month, after the U.S. Security Exchange Commission declined nine bitcoin ETFs, the price of the major crypto remained stable. How resilient is it? 

9. September: The First Crypto-Related Company Files for IPO

Bitcoin price: $7,192

Most of September’s announcements were quite positive. First, there was more news about Goldman Sachs jumping into crypto. The company’s chief financial officer Martin Chavez confirmed that the Wall Street giant was working on the development of bitcoin-based derivatives that will be accessible to the bank’s clients. 

At the end of the month, one of the leading bitcoin miners, Bitmain, spilled out their intention to run an initial public offering (IPO). And the application for the process was already filed. Bitcoin Cash prices (one of the assets Bitmain is mining) surged up to 20% rapidly. 

10. October: Happy birthday, Bitcoin. Here’s Your Mass-Adoption

Bitcoin price: $6,619

More happy news to celebrate the ten-year anniversary of Bitcoin’s whitepaper. Big steps from institutional investors happened in the middle of October when Fidelity Investments announced the launch of a spin-off company, dedicated to crypto assets exclusively. The new firm named Fidelity Digital Assets was onboarding its first clients and still preparing for the grand opening for the general public in 2019. 

Also, the launch of the first blockchain phone, made by HTC, stole the headlines in October. 

11. November: Blood, Sweat, and Tears of Bitcoin Cash Fork 

Bitcoin price: $6,427

Fights over the Bitcoin Cash fork got completely out of control. The battle between BCHSV (Satoshi Vision), lead by Craig Wright, aka Fake Satoshi and BCHABC (Adjustable Blocksize Cap), driven by Roger Ver, previously labeled as Bitcoin Jesus was observed by the entire industry. It triggered huge crypto volatility, increased trading volume and, as some experts might say, a bitcoin nosedive to a new bottom. And we are still in the middle of that roller coaster.

On the other hand, we had some good news too. Like the announcement about the first state in the U.S. will be accepting bitcoin as a tax payment. Way to go, Ohio! 

This year is not over yet, and we don’t know exactly what the future holds. As you know in crypto, “one day you are in, and another day you are out”.  But we promise to keep you posted. 

And what was your favorite news break of the year? Go ahead and share it in the comment section below.

Learned something new in this article? Subscribe to the Block Explorer newsletter to get exclusive crypto insights before they appear on the site.

vitalik buterin

In a bizarre series of tweets, Ethereum’s founder Vitalik Buterin has granted more than $300,000 worth of ether to three Ethereum startups.

Buterin, whose Twitter name “Vitalik Non-giver of ether” pokes fun at those asking him for free cryptocurrency, granted the money in 1,000 ETH installments. The three startups in question include:

  • Prysmatic Labs – a startup building a sharding client for Ethereum 2.0.
  • Chainsafe Systems – a company building blockchain platforms and smart contracts for other startups.
  • Sigma Prime – a cybersecurity startup working on the lighthouse project for Ethereum.

Buterin handed out the grants in a Twitter thread discussing Ethereum’s lack of focus and urgency regarding scalability. Preston Van Loon of Prysmatic Labs joined the conversation to lament that his team didn’t have the resources to focus on Ethereum full time:

To which Vitalik Buterin replied:

Buterin went on to donate 1,000 ETH to ChainSafe after one contributor claimed he would drop out of university for a grant. The final 1,000 ETH donation went to Sigma Prime after one developer promised to hire new team members.

Buterin confirmed all transactions with a link to the Etherscan block explorer and followed up with a tongue-in-cheek warning: 

Further reading: What is Ethereum? Absolutely Everything You Need To Know

Tim May cypherpunks

Cypherpunk Tim May has reportedly died at his home in California. May was a co-founder of the Cypherpunk mailing list and author of The Crypto Anarchist Manifesto. His influence lay the groundwork for bitcoin, cryptocurrencies, and a new movement of privacy advocates.

Word of his death was announced by fellow cypherpunk Lucky Green: 

“My dear friend, co-conspirator in many things and for many years, fellow Freedom Fighter Tim May passed away earlier this week at his home in Corralitos, California… Tim May co-founded the Cypherpunks, perhaps the single most effective pro-cryptography grassroots organization in history.”

Founded in 1992, Tim May’s Cypherpunk mailing list was home to some of the most groundbreaking ideas in cryptographic and cryptocurrency history. Wei Dei shared his vision for a digital currency called b-money on the mailing list, many years before bitcoin was envisioned. Nick Szabo shared his concept for “smart contracts,” a decade before Ethereum came along to popularize the technology. And Adam Back outlined an early version of “proof of work,” which became the algorithm behind bitcoin.

The Cypherpunk mailing list was a melting pot of concepts and ideas that eventually came to the mainstream via Satoshi Nakamoto’s famous bitcoin whitepaper.

Without Tim May and the cypherpunk movement, there would be no bitcoin.

The Eerily Accurate Predictions of The Crypto Anarchist Manifesto

May’s lasting contribution to the world, however, is The Crypto Anarchist Manifesto. A short, passionate piece of writing published in 1988 that predicted the future with eerie accuracy. 

May outlined how computer technology would provide “the ability for individuals and groups to communicate and interact with each other in a totally anonymous manner.”

However, he explained how governments would react negatively to the movement. 

“The State will of course try to slow or halt the spread of this technology, citing national security concerns, use of the technology by drug dealers and tax evaders, and fears of societal disintegration.”

May even predicted how the technology would lead to an internet black market: 

“[Cryptography] will allow illicit and stolen materials to be traded. An anonymous computerized market will even make possible abhorrent markets for assassinations and extortion.”

The prediction is not a million miles away from the infamous Silk Road marketplace which harnessed bitcoin as a payment method.

But May was right in predicting that these events would not bring down the wider movement:

“This will not halt the spread of crypto anarchy.”

“Satoshi would barf”

As bitcoin infiltrated the mainstream, May became somewhat disillusioned with the trajectory. In his last published interview with CoinDesk, he lamented the direction of cryptocurrency:

“I can’t speak for what Satoshi intended, but I sure don’t think it involved bitcoin exchanges that have draconian rules about KYC, AML, passports, freezes on accounts and laws about reporting “suspicious activity” to the local secret police… I think Satoshi would barf.”

The Crypto Anarchist Manifesto, in Full

For those that are interested in Bitcoin and its history, take some time to read through The Crypto Anarchist Manifesto in full. This is how cryptocurrency took shape. It’s how the early pioneers envisioned the technology and what it could do. RIP, Tim May. 

The Crypto Anarchist Manifesto – Timothy C. May

A specter is haunting the modern world, the specter of crypto anarchy.

Computer technology is on the verge of providing the ability for individuals and groups to communicate and interact with each other in a totally anonymous manner. Two persons may exchange messages, conduct business, and negotiate electronic contracts without ever knowing the True Name, or legal identity, of the other. Interactions over networks will be untraceable, via extensive re- routing of encrypted packets and tamper-proof boxes which implement cryptographic protocols with nearly perfect assurance against any tampering. Reputations will be of central importance, far more important in dealings than even the credit ratings of today. These developments will alter completely the nature of government regulation, the ability to tax and control economic interactions, the ability to keep information secret, and will even alter the nature of trust and reputation.

The technology for this revolution–and it surely will be both a social and economic revolution–has existed in theory for the past decade. The methods are based upon public-key encryption, zero-knowledge interactive proof systems, and various software protocols for interaction, authentication, and verification. The focus has until now been on academic conferences in Europe and the U.S., conferences monitored closely by the National Security Agency. But only recently have computer networks and personal computers attained sufficient speed to make the ideas practically realizable. And the next ten years will bring enough additional speed to make the ideas economically feasible and essentially unstoppable. High-speed networks, ISDN, tamper-proof boxes, smart cards, satellites, Ku-band transmitters, multi-MIPS personal computers, and encryption chips now under development will be some of the enabling technologies.

The State will of course try to slow or halt the spread of this technology, citing national security concerns, use of the technology by drug dealers and tax evaders, and fears of societal disintegration. Many of these concerns will be valid; crypto anarchy will allow national secrets to be trade freely and will allow illicit and stolen materials to be traded. An anonymous computerized market will even make possible abhorrent markets for assassinations and extortion. Various criminal and foreign elements will be active users of CryptoNet. But this will not halt the spread of crypto anarchy.

Just as the technology of printing altered and reduced the power of medieval guilds and the social power structure, so too will cryptologic methods fundamentally alter the nature of corporations and of government interference in economic transactions. Combined with emerging information markets, crypto anarchy will create a liquid market for any and all material which can be put into words and pictures. And just as a seemingly minor invention like barbed wire made possible the fencing-off of vast ranches and farms, thus altering forever the concepts of land and property rights in the frontier West, so too will the seemingly minor discovery out of an arcane branch of mathematics come to be the wire clippers which dismantle the barbed wire around intellectual property.

Arise, you have nothing to lose but your barbed wire fences!

boerse

Börse Stuttgart Group, Germany’s second-largest stock exchange, will launch a cryptocurrency trading platform in 2019.

The launch is another milestone in a flurry of institutional activity around bitcoin and cryptocurrencies. Nasdaq is currently preparing a bitcoin futures trading platform for early 2019 and the long-awaited Bakkt platform is set to launch in January.

The German stock exchange has partnered with solarisBank, a fintech company, to facilitate the trading platform.

Bitcoin and ether will be available to trade at the launch, but other tokens will follow shortly after. Boerse is targeting both individual and institutional investors, and the platform will look familiar to those who have traded stocks on the Boerse exchange.

As the accompanying press release explains: “The crypto trading venue is open to both private and institutional investors and facilitates order opportunities comparable to securities trading.”

A fee-free trading app and custody services are set to follow shortly after.

(Source: CoinDesk)

Crypto Curious? Subscribe to the Block Explorer newsletter to get exclusive crypto insights before they appear on the site.

cryptocurrency active users

A new report by the University of Cambridge concludes that millions of new cryptocurrency users entered the space in 2018. However, only 38% are considered active.

The study collected data from 180 blockchain companies including exchanges, wallets, payment providers, and miners.

There are now 139 million cryptocurrency user accounts across the various service providers, with at least 35 million identity-verified users, double the number from 2017. This is likely due to the rapid implementation of KYC (know your customer) checks which require selfie identification before registering.

Cryptocurrency users

“Most remain passive”

Although the growth of cryptocurrency users is impressive, especially in the prolonged market downturn, most are not active users.

The study points to just 38% of active accounts. It implies that most cryptocurrency users are either holding for the long term or have become disengaged with the platform. 

However, user activity is difficult to pinpoint because “the criteria for determining the level of user activity vary significantly from one service provider to another.” Some platforms record weekly logins while others track monthly logins.

Slower Growth in 2018

As you might expect in a year where cryptocurrencies have lost 85% of their value, firms saw slower user growth in 2018. 

The average firm saw a 535% user growth rate in 2017 compared to 161% in 2018 so far. We should also point out that the vast majority of users are individuals, not businesses. 

“Individuals can be hobbyists, retail investors, consumers, or users seeking a better investment or payment alternative.”

Conservative estimates

The authors also point out that its figures are on the conservative side: “we believe that the figures represent the lower-bound of the global cryptoasset unique user base.”

The study goes on to conclude that cryptocurrency mining is less centralized than initially thought, citing rapid growth in the USA and Canada, and that firms are increasingly self-regulating, adopting regulations even when they are not necessarily required to do so.

Crypto Curious? Subscribe to the Block Explorer newsletter to get exclusive crypto insights before they appear on the site.