Cryptocurrency

FOR IMMEDIATE RELEASE: 12th July 2018

Cryptocurrencies are traditionally perceived as investment avenues for quick and high returns, and mostly been limited to trading purposes. However, as they continue to gain considerable ground in Asia-Pacific (APAC), several companies are now looking to leverage the high user base and explore the other possible use-cases, says leading data and analytics company GlobalData.

Reportedly, Japan and South Korea are among the top three markets globally, along with the US, for cryptocurrency trades. As of January 2018, nearly one third of global bitcoin transactions were made with Japanese Yen and South Korea accounted for around 35% of global Ethereum trading.

Sowmya Kulkarni, Payments Analyst at GlobalData, says: “The gradual rise in cryptocurrency acceptance at merchant locations can be seen as an upcoming trend in the region, with merchants increasingly opting for this method of payment due to benefits such as lower transaction fees, no chargebacks, and cheaper payment acceptance from foreign tourists.”

Large merchants such as Bic Camera and Yamada Denki in Japan and Goto Mall in South Korea are now accepting payments with cryptocurrencies, which is likely to push many more peers to look at accepting cryptocurrency payments.

Most recently in March 2018, Bithumb – a cryptocurrency exchange in South Korea – partnered with Korea Pay Services to enable 6,000 retail outlets across South Korea to accept cryptocurrency payments. Earlier in April 2017, Coincheck – a cryptocurrency exchange in Japan – partnered with Recruit Lifestyle to roll out its bitcoin-enabled POS app AirREGI across 260,000 merchant stores in Japan.

The continued development of the cryptocurrency market has attracted considerable interest from regulators in Japan, Australia and South Korea. The new regulatory initiatives are expected to provide a much-needed push to widen the use-case of cryptocurrencies.

“Cryptocurrency has traditionally been a topic of discussion for its volatility and authenticity, with several industry experts not reckoning it as an alternative to traditional payment tools. This perception is changing with a large number of merchants and consumers in the region now gradually embracing it as a payment tool. Lower transaction charges compared to traditional card-based payments could make cryptocurrencies a preferred choice among merchants.

“In addition, merchants can also avoid costly chargebacks as purchases through cryptocurrencies are one-way and irreversible in nature. Customers also stand to benefit from cryptocurrency transactions in the form of potential pricing benefits from merchants, higher security, and easy borderless payments. This form of payments is now becoming increasingly popular among tourists, as they don’t attract foreign exchange charges,” concludes Sowmya.

ENDS

For more information:

Analysts available for comment. Please contact the GlobalData Press Office:

Asia-Pacific: +91 40 6616 6809

EMEA & Americas: +44 (0)207 832 4399

Email: [email protected]

About GlobalData

4,000 of the world’s largest companies, including over 70% of FTSE 100 and 60% of Fortune 100 companies, make more timely and better business decisions thanks to GlobalData’s unique data, expert analysis and innovative solutions, all in one platform. GlobalData’s mission is to help our clients decode the future to be more successful and innovative across a range of industries, including the healthcare, consumer, retail, financial, technology and professional services sectors.

If you would rather not receive future communications from GlobalData, let us know by clicking here.
GlobalData, John Carpenter House 7 Carmelite Street, London, N/A EC4Y 0BS United Kingdom

Ethereum developers have launched an alpha test network (testnet) for Casper, paving the way for the cryptocurrency to eventually transition to a proof-of-stake (PoS) consensus algorithm.

Like bitcoin, ethereum currently operates on a proof-of-work (PoW) consensus algorithm, meaning that the network is secured and new currency units are issued through “mining,” whereby participants solve cryptographic puzzles to validate transactions and create new blocks.

However, PoW has attracted criticism over the years, both for its tendency to centralize mining hardware into a few pools and for the amount of electricity it consumes.

Ethereum to implement Proof-of-Stake

Ethereum aims to address these problems by transitioning to Casper, a proof-of-stake (PoS) consensus algorithm. Under Casper, participants can become validators by locking up or “staking” ether. Validators will take turns proposing and voting on blocks, and both the weight of their votes and the size of their rewards will hinge on the size of their stakes.

According to developers, moving to Casper will greatly reduce the amount of electricity “wasted” through PoW mining. In addition to limiting its environmental impact, PoS will allow ethereum to dramatically reduce its rate of currency inflation since validators will have much lower overhead and will thus require smaller rewards to incentivize them to continue to serve as validators.

Moreover, PoS will also reduce the incentive that validators have to centralize their influence. With decreased centralization comes increased security and, importantly, resistance to dreaded 51 percent attacks.

Ethereum is not the first project to attempt to integrate a PoS consensus algorithm. However, most previous PoS implementations have been criticized because, in the event of a blockchain split, validators are incentivized to try to make blocks on top of every chain rather than resolving the consensus back to a single blockchain.

casper
Source: Ethereum/Github

Casper aims to solve this problem by imposing economic penalties on malicious validators that violate the network’s rules. This ensures that validators are properly incentivized to achieve consensus on a single blockchain in the event of a network split.

Following three years of development, Casper has officially entered alpha testing, and the first full-featured testnet has launched. The software must still traverse several release checkpoints before it is ready to launch on the main network, but this alpha release nevertheless marks an important step toward its eventual activation on the main ethereum network.

Casper
Source: Vitalik Buterin/Twitter

Users can join the testnet by following the instructions in this guide, and once online they can send transactions and become validators, just as they would on a normal network, although the network’s performance is not indicative of how production clients will operate once the project receives an official release.