China destroy bitcoin

Welcome to the weekend, folks. Grab a coffee and let’s recap the biggest news stories of the week in cryptocurrency and blockchain.

China Has “Capability” and “Motive” to Destroy Bitcoin, According to Report

A new report this week claims China could destroy Bitcoin. The report, authored by researchers at Princeton University and Florida International University outlines 19 different ways China could attack the Bitcoin network.

Is it based in truth?

Theoretically, yes. The report points to the fact that 74% of Bitcoin mining hash power comes from China. And five of the six largest Bitcoin mining pools are located in the country.

bitcoin mining pools

If those mining pools collectively orchestrated a 51% attack, they would control the network, and bring it down if they wish.

However, it’s important to point out that the Chinese government doesn’t own these mining pools. And the mining pools themselves have little incentive to execute a 51% attack (it would kill the value of bitcoin, making their efforts worthless).

What is concerning is the level of Bitcoin centralization in China.

The report goes on to explain how China’s “Great Firewall” appears to give Chinese miners an advantage. It slows down miners outside China and incentivizes those within the firewall to generate “empty blocks” (the blocks contain no transactions, but the miner receives a bitcoin reward anyway).

This, coupled with cheap electricity in China, is centralizing mining power in one country. And that’s a problem.

Note: the report in question has not yet been peer-reviewed.

Venezuela Is Forcing Citizens to Use Its Controversial Cryptocurrency to Buy Passports

As Venezuela’s fiat currency, the bolivar, soars towards 1,000,000% inflation, the government is putting its faith in a state cryptocurrency, petro.

Venezuela petro cryptocurrency

The petro was created by the Venezuelan government and its value is backed by the country’s oil price to keep it stable. Citizens are now required to pay for passports and renewals using only the petro cryptocurrency.

But the petro isn’t without controversy. Its creators have been accused of ripping off the Dash whitepaper. The US government has also accused Venezuela of using the petro to defraud investors, and critics say the petro pre-sale didn’t generate nearly as much as the Venezuelan government claims.

Cryptocurrencies Pose No Risk to Global Financial Stability

In somewhat brighter news, a report this week concluded that cryptocurrencies are not a risk to the global financial system.

The report carries some weight. It was released by the Financial Stability Board and is backed by the Bank for International Settlements, the world’s oldest financial institution.

However, it does go on to say there may be a tipping point in the future.

If they continue to grow, the report claims, cryptocurrencies may one day pose a threat to the reputation of current banks and financial systems. There may be a risk of exposure if traditional banks adopt crypto on a wider scale.

And there may be risky consequences if bitcoin or other cryptocurrencies become a common payment method.

Price News

The cryptocurrency market suffered an epic $16 billion wipeout on Thursday. It took place in just a few hours, dragging bitcoin down 4%.

bitcoin price
Chart: Coinmarketcap.com

As usual, altcoins bore the worst of the fall. Ethereum, XRP, and others fell in the region of 10%.

That’s all for this week. We’ll be back bright and early on Monday.

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bitcoin-whale

A mysterious Chinese investor has been ‘buying the dip’ so to speak, again and again, amassing one of the largest bitcoin wallets in the entire world.

The bitcoin ‘whale’ – as the cryptocurrency community calls investors with enough of an asset to make a big splash in moving market prices – has been slowly and steadily accumulating the leading cryptocurrency by market cap since March 25, 2018. In total, 93,947 BTC have been transferred to the whale’s wallet, or roughly $722.5 million dollars at bitcoin’s current price at the time of this writing.

The wallet address 1KAt6STtisWMMVo5XGdos9P7DBNNsFfjx7 currently has 85,947 BTC, or nearly $661 million, indicating an 8,000 BTC sale or trade has occurred.

The China-based, award-winning blockchain media firm BABI Finance has been following the whale’s movements for some time. BABI notes that the account in question has mostly been buying bitcoin when the price falls, but rarely sells.

BABI followed 20,000 of the bitcoins back to their sources: popular Chinese cryptocurrency exchanges Huobi and Haobtc. Another 67,000 BABI says are from “wholesale transfer[s] of fourteen ‘single accounts.’” BABI also notes that some of the ‘single accounts’ can also be traced back to Huobi and Haobtc. The remaining 7,800 bitcoins are “small transfers” from “multiple accounts.”

BABI concludes that the whale is likely “a long-term investment institution”, while other speculation points to a potential exchange setting up a cold wallet.

Due to bitcoin’s pseudo-anonymous design, tracing the bitcoins back to the investor has proven too difficult for BABI. BABI claims “an unnamed people (sic) in wholesale digital currency industry” states that its a large agent in Dubai buying the bitcoin for an unknown client.

What is known, though, is that this client – or Chinese bitcoin whale – now owns the sixth largest stack of BTC, with the top five wallets belonging to top cryptocurrency exchanges Bitfinex, Binance, Bittrex, Huobi, and Bitstamp, respectively.

Blockchain

A joint survey by PwC and VeChain has found that most enterprises prefer to setup their own in-house research and development (R&D) teams to investigate the blockchain.

The survey, 2018 Market Survey Report for (Non-Financial) Application of Blockchain in Chain, was conducted between November and December 2017, taking the form of online questionnaires and focus group discussions.

The research found that among the companies that have already introduced the blockchain, 53.3 percent have setup in-house blockchain technology R&D teams. Those who corporate with blockchain startups was at 30 percent; corporation with well-known large businesses was at 13.3 percent; and investing in or acquiring external blockchain startups was at 3.3 percent.

The authors of the study, Chun Yin Cheung from PwC and Kevin Feng from VeChain, wrote:

When it comes to technologies that have impact on the underlying architecture of the business model, an enterprise usually prefers to build a R&D of its own. On the one hand, in-house R&D team can facilitate system maintenance, information security and cost reduction. On the other hand, enterprises prefer to keep the underlying architecture of the business model under their control.

According to the findings, it also found that management plays a significant role in driving the technology to maturity. This accounted for 35.1 percent, followed by a lack of industry standards at 18.9 percent of the findings. Notably, 10.1 percent indicated that it was down to having no budget that was preventing them from implementing the technology.

Yet, when it comes to the application that best applies to the distributed ledger, security traceability was the most recognized at 85.70 percent.

Most respondents believe the core features of blockchain technology are tamper-resistance and distributed system. Obviously, security traceability becomes one of the fields most demonstrating the features of blockchain technology, the authors wrote.

Second and third to that were distributed data storage and identity authentication, which came in at 68.40 percent and 63.90 percent, respectively. Out of the 10 listed applications that best apply to the technology, market forecasting was last at 15.80 percent.

With the distributed ledger now being used across a wide range of industries it is showing its potential to change the way systems work. The findings show the fields were it has a promising future are logistics, government, and the medical field at 63.3 percent, 47 percent, and 44.4 percent.

With respondents mainly clients from PwC and VeChain, they received more than 130 questionnaires while two focus groups engaged over 40 respondents. Respondents were from around 20 industries, involving more than 10 functional departments.

Featured image from Shutterstock.

coin renders

Use our news to inform cryptocurrency trading decisions, stay up-to-date on happenings in the industry, and more!

The SEC Launches Phony ICO Site to Promote Scam Awareness
In a bid to raise awareness of potential investment scams in the cryptocurrency space, the U.S. Securities and Exchange Commission’s (SEC) Office of Investor Education and Advocacy have launched a fake website posing as a luxury travel firm kicking off the pre-sale portion of their initial coin offering (ICO).

Cryptocurrency Mining Malware Crashes Your PC When Discovered
Please beware: a new form of cryptominer, dubbed WinstarNssMiner, crashes your system the moment anti-virus software attempts to remove the malware. ZDNet warns “The cryptominer launches the svchost.exe process — used to manage system services — and injects malicious code into the file. One injected process begins mining cryptocurrency while the other runs in the background to avoid detection and scan for antivirus protection.”

Steve Wozniak: Bitcoin And Blockchain Will Achieve Full Potential In a Decade
Tech leaders everywhere are beginning to sing the praises of blockchain. Apple’s co-founder Steve Wozniak was the latest, saying blockchain was “a great idea” and that it “is the next major IT revolution that is about to happen” according to Cointelegraph auf Deutsch. Woz was giving the opening speech at WeAreDevelopers World Congress 2018 in Vienna, Austria.

China Ranks Ethereum as the World’s Best Blockchain Network
The Chinese government ranked Ethereum as the world’s best blockchain network. CCN reports “On May 17, China’s Ministry of Industry and Information Technology released its public blockchain ratings, ranking various blockchain projects like Ethereum in the global cryptocurrency sector based on three criteria: technology, application, and innovation.” Bitcoin came in at number 13.

Entirely Crypto-Focused LedgerX Announces the First Regulated Bitcoin Savings Account
“Bitcoin bulls now have a new opportunity to put their money where their sentiment is. On Tuesday, CFTC regulated derivatives exchange, LedgerX, launched a Bitcoin savings account, the latest in a slew of traditional banking products made available for the digital currency” as reported by CryptoSlate.

New Coinbase Prime Geared Towards Wall Street Investors
This week Coinbase announced Coinbase Prime, a set of tools and services for institutions, tailored for high-end investing in cryptocurrency.

Image courtesy of Carty Sewill, http://cartyisme.com/

coin renders

Use our news to inform cryptocurrency trading decisions, stay up-to-date on happenings in the industry, and more!

New Head Of South Korean Financial Regulator Considers Relaxing Cryptocurrency Regulations

The Korea Times is reporting new Financial Supervisory Service Governor Yoon Suk-heun said the country will consider relaxing cryptocurrency regulations. An official from one of South Korea’s four major cryptocurrency exchange operators, Upbit, said, “We don’t oppose regulations. But you can’t entirely kill the markets by simply imposing regulations. What the new FSS chief should think about is how the regulators should provide remedies to help crypto trading and blockchain technology get better.”

Monero Cryptojacker Using NSA exploit EternalBlue

BlockExplorer’s Armin Davis reports that following the use of the NSA developed EternalBlue exploit in the now infamous ransomware WannaCry, a new malware known as WannaMine has surfaced.

Iceland’s 600 Missing Bitcoin Mining Machines Reported To Be in China

Earlier this year 600 Bitcoin mining machines were stolen from Iceland, a case generally chalked up to unsolvable until a few days ago when Icelandic media outlet RUV reported the machines are likely in Tianjin, China. Cointelegraph reports, “In Tianjin, it was precisely a pattern of highly irregular electricity usage that is reported to have attracted the attention of a local grid operator, leading to the authorities’ confiscation of the suspect mining hardware.”

Bitmain to Begin Shipping Equihash ASIC Miners in June

Chinese mining rig manufacturer Bitmain has unveiled the first Equihash ASIC miners, BlockExplorer’s David Murray reports, “making it likely that it will soon be unprofitable to mine Zcash using GPU-powered devices.”

BlockShow Europe 2018 Coming Up May 27-28

BlockExplorer’s Isaac Rocket reports, “After an eventful two months of hosting blockchain meetups across Europe, Blockshow is bringing their journey to a close with the featured conference, BlockShow Europe 2018.” This will be a big event with over 80 blockchain experts presenting, on the most pressing issues of today’s blockchain community.