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The latest news on Facebook's Libra

Facebook's Libra

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Analysis and quick takes on Tether

A spotlight on Tether

Introducing: Tokenize all the Things

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Talking tokens with Adam B. Levine

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The world is built on a giant $256 trillion pile of assets. Everything from property to art, to stocks to oil. Blockchain wants to change all that. This collection explores the industries being disrupted, by whom, and what that means for both consumers and enterprises.

We've delved deep into the tokenized world to uncover the people, the projects and the potential of this technology to change capital forever.

Blockchain’s promise of a more liquid world

Tokenize all the Things

Telegram, one of the largest messaging platforms in the world—and used by many in the crypto industry—is launching its own blockchain platform. But it's up against a deadline: October 31. Will it deliver the GRAM cryptocurrency on time or will it be forced to backtrack on its ambitious plans?

Insights on Telegram's upcoming blockchain platform

Telegram's crypto play

Crypto Capital has worked with major exchanges, including Binance, Kraken, BitMEX and Bitfinex. But it was never really a bank, and two of its founders have been arrested by the FBI. We dig deep into it here.

Insights into the shady Panamanian bank that has been underpinning the crypto industry to this day.

The Crypto Capital Scandal

The Ethereum community gathered in Osaka, Japan, for its fifth developer-focused conference. Here are all the highlights and everything you need to know.

Breaking news and features live from Devcon's fifth conference.

Devcon 5

The largest crypto exchange in the world is expanding to the US. We track its major developments as it gears up for launch. Will the exchange survive or suffer in the harsher regulatory climate?

The latest on Binance's push into America

Binance in the USA

Decrypt's coverage of all the events taking place at Blockchain Week in and around New York City.

Decrypt's coverage of NYC Blockchain Week events

New York Blockchain Week: 2019

Adriana Hamacher

Veteran blockchain developer Zaki Manian has stepped down from his role as director at Tendermint, where he was head of all things related to the development of the Cosmos blockchain. In an exclusive interview with _Decrypt_, Manian revealed that he resigned last week, but would still continue to work on Cosmos. 

Internal struggles, which have consumed the startup, became public earlier this month when Manian accused founder Jae Kwon of mismanagement. Insiders told _Decrypt_ that Manian subsequently threatened to quit the project—and take the bulk of the engineering team with him—unless Kwon stepped down from his CEO role.  He also warned that the startup's new protocol would not ship unless he was given free rein. 

In an interview with _Decrypt_ today, Manian said that he was reluctant about his decision to resign.

“There are people inside the company that want to portray this as a power struggle between me and Jae, and this as an outcome and me threatening x, y and z,” he said. “But it was really me saying I don’t see a way in this arrangement to get the work done. And the best way to get the work done was for me to leave.”

Kwon declined to comment.

It’s unclear how many other developers have stepped down from the project; Manian declined to say how many have followed him out the door. At the beginning of this month the company had  60 employees. 

While Manian said that the community has always been “a multi-entity ecosystem and there’s ways of working together,” the project now enters uncharted waters, with repercussions for projects far beyond Cosmos—and its investors. 

THE INTERNET OF BLOCKCHAINS

Cosmos, one of the biggest, brightest projects in the cryptocurrency industry, is a  self-described “Internet of Blockchains.” The platform's ATOM token is ranked 21, with a market cap near $814 million. At the heart of this network of decentralized interoperable platforms is a unique protocol, developed by Kwon, a well-regarded open source developer. 

In 2014, he was the first to introduce byzantine-fault tolerant (BFT) algorithms into the blockchain space, and founded Tendermint to explore the ramifications of the new protocol. 

The project raised its funding target of $17 million in the first 29 minutes of a 2017 public token sale; its war chest was worth some $1 billion at the height of the crypto gold rush a few months later.

 The discovery that led Jae Kwon to build the Cosmos blockchain

Cosmos had no trouble getting high quality projects to build on top of its SDK (Software Development Kit.) Those jumping aboard included Binance, the biggest cryptocurrency exchange by volume. 

In March 2019, the first iteration of the Cosmos network successfully launched,  validators came on board, and the project raised $9 million in a funding round. The only thing missing was the final piece of Kwon’s grand jigsaw: the Inter-Blockchain Communication (IBC) protocol—the key to allowing any blockchain using the Cosmos SDK to easily connect to the Cosmos hub. 

COSMOS IN CHAOS

In April, Kwon told _Decrypt_ that the new protocol was expected to be ready “within a few months.” But, when, in October, a demo failed to materialize at San Fransisco Blockchain Week, rumors of trouble and strife at Tendermint began to leak. 

Insiders said that the problems started not long after the platform’s launch, in March, and the main reason was the lack of a clear strategy. But other reports suggest that this wasn’t the only issue. 

A few weeks ago, news broke that Kwon was supposedly stepping down as CEO of Tendermint, taking a backseat in the Cosmos project, and starting a new one called “Virgo.” 

 Cosmos founder Jae Kwon is stepping down

But Kwon immediately denied the report, and said that the goal was rather to “eliminate the role of CEO,” and “decentralize Tendermint,” by implementing checks and balances from within. 

Three days later Zaki Manian issued his broadsides on Twitter.

> Over the last 6 months, Jae has obsessively focused on Virgo while neglecting and under resourcing IBC. He threw a painstakingly planned hiring and resource improvement proposal out the window to become @BitcoinJaesus . His behavior has become an untenable distraction.
> 
> — Zaki Manian (@zmanian) February 3, 2020

COSMUHAMMAD BITCOIN JAESUSTEIN

Manian accused Kwon of “evading responsibility,” as well as neglect and negligence of the Cosmos project. He called Virgo, and Kwon’s plans to decentralize the company, “a huge lie.” And he added that his goal was to remove Kwon from work on the forthcoming IBC protocol, due to behavior that had become “an untenable distraction.” 

Some prominent industry members came out in support of his position: 

> 莫管闲事 搞好zcash😐
> 
> — Cyyy0 (@F77uEP0xdzq7f0q) February 4, 2020

Of the six staffers who spoke to _Decrypt_ on background, three expressed doubts that Kwon was still committed to Cosmos; they worried about his confusing Twitter personas, such as his new alias, Cosmuhammad Bitcoin Jaesustein; they complained about his behavior and  that he appeared to be obsessed by climate change, the coronavirus and other matters unrelated to Cosmos. 

They also said that Kwon was starving the project of the necessary resources needed to develop the protocol, and obstructing the hiring of engineers. 

But three others, who spoke to _Decrypt_ on background, painted a different picture, saying that other key personnel weren’t up to the job. We were also provided with a screenshot of a company memo that indicates that the hiring freeze was implemented by Manian, not Kwon, as many believed.

Manian declined to comment on those allegations.

CONFLICT OF INTEREST

Ironically, for a company which aims to serve as a platform for the world’s blockchains, conflict of interest has been at the heart of its issues, say critics.  

Another internal memo shown to _Decrypt_ demonstrates that shortly before Manian’s Twitter outburst, Kwon informed the team that no one with conflicting interests could serve on the board of directors of Tendermint.

Insiders loyal to Kwon alleged that this precipitated Manian’s reaction, because he and others are involved in other projects, and have their own validators, which would preclude them getting a seat on the board. 

> FYI I don’t have a validator, I don’t have significant stake in another company. I still have north of 98% of my net worth in atoms directly or in the form of AIB shares, and it will stay high for as long as I can help Cosmos stay true. In terms of staking I’m an ATOM maximalist.
> 
> — Cosmuhammad Bitcoin Jaesustein (@jaesustein) February 3, 2020

Those supporting Manian, were quick to defend their position: 

“We have long had a history of collaborators. It allows us to work with some of the most exciting new projects,” a team member told _Decrypt_. He also claimed that Kwon had been trying to make conflict of interest a core issue for a while.   

Manian insisted that rather than a conflict of interests the issue was really that nobody except Kwon was ever really in charge. “He is the central figure in the operations of the company, the image and the decision making,” said Manian.

 He claimed that the engineering team asked him to step in, and help bring some more order and improve the quality of execution on IBC.

“It was never really in my self interest,” Manian insisted. “It was a better alternative to what we’re doing right now which is this very painful attempt to reorganise the whole ecosystem, which is inevitable and needed to be done, but I would have preferred to have shipped IBC first.” 

He says that he is still supervising Cosmos, “in the sense that people value my opinion and insight.” An offical statement about his resignation is yet to be issued.

THE INVESTORS ARE NOT AMUSED

In March 2019, Tendermint received backing from investors Bain Capital, Paradigm, and 1confirmation.

"Who says Netflix has the best dramas? Open source and crypto have the best dramas," Salil Deshpande, who was Managing Director of Bain Capital at the time the investment, told _Decrypt_. 

A well respected VC, Deshpande has chronicled other such dramas. He also made the Forbes Midas List of 100 best-performing venture investors seven years in a row, and has since started his own fund, Bain-backed Uncorrelated Ventures. He’s been watching the antics at Tendermint at a  respectful distance, and has high hopes that the matter will be resolved amicably.

"Blockchain interoperability is one of only a handful of decentralized infrastructure use cases I have high conviction about, and Cosmos is by far the best technology for that use case. If they figured that out, they'll figure this out,” he said. 

The wider Cosmos community, famous for its high level of involvement in the project, has also been supportive.

“I think we’ll eventually come together as a Cosmos community that is a really exciting structure,” said Manian. “Every ecosystem, if they’re successful enough is going to eventually have to grapple with some of these issues,” he added. “If we can keep the Cosmos project on track through this period of turmoil, we will be more resilient and more decentralized and better off for it.”


Blockchain

business

Cosmos

cryptocurrency

finance

Startups

Technology

Cosmos aims to become the “Internet of Blockchains,” where any blockchain is able to communicate, share data, and transact with any other.

Zaki Manian resigned as director of Tendermint on February 7. (Image source: Zaki Manian)

<ul>
<li>Veteran developer Zaki Manian has stepped down from his role at Tendermint.</li>
<li>Manian claimed that founder Jae Kwon was mismanaging the Cosmos team. Others allegedly joined him in quitting.</li>
<li>Manian said he’ll continue working on the project.</li>
</ul>

In brief

Insights into the biggest events shaping the crypto industry.

News

“The best way to get the work done was for me to leave,” said Manian. His departure comes after months of bitter infighting at Tendermint, developer of the $800m Cosmos blockchain. 

Frank Cardona

Another day, another Bitcoin ransom scam. This time, website owners who use Google’s advertising service “AdSense” say they have received emails with demands for Bitcoin, according to a report by cybersecurity researcher Brian Krebs.

Fraudster’s are apparently attempting to scam website owners by threatening to flood their banner ads with bot-fueled junk traffic until Google’s automated anti-fraud system suspends their account. 

Last year, Google had announced it was stepping up its efforts to stop fraudulent traffic. It appears fraudsters are using this to attempt to scare website owners into forking over Bitcoin. 

“AdSense traffic assessment algorithms will detect very fast such a web traffic pattern as fraudulent,” a scam email read, which a website owner provided to Krebs. The email subsequently demands $5,000 worth of Bitcoin to avoid the attack. 

The website owner who shared the latest scam told Krebs that while he thought it was a “baseless threat,” he did notice an uptick in his AdSense invalid traffic report.

 Bitcoin extortion scheme linked to string of Dutch bombings

Google declined to address the user’s specific account, but told Krebs in a statement that it was aware of this “classic threat of sabotage.”

“We hear a lot about the potential for sabotage, it’s extremely rare in practice, and we have built some safeguards in place to prevent sabotage from succeeding,” Google’s statement read. “For example, we have detection mechanisms in place to proactively detect potential sabotage and take it into account in our enforcement systems,” the statement added.

Bitcoin is a popular payment option for internet fraudsters. A recent report by blockchain forensics firm CipherTrace said “97% of ransomware uses BTC (Bitcoin) as the payment rail.”

While this case did not feature “ransomware,” software that infects a user’s computer and immobilizes functions and files until a ransom is paid, it shows that fraudsters are finding other ingenious ways to extract Bitcoin from potential victims. 

Just last week, a series of Dutch bombings similarly demanded Bitcoin to prevent future attacks. These and other recent cases show that Bitcoin-fueled fraud and extortion schemes aren’t going away anytime soon. 


advertising

bitcoin

google

money

Bitcoin is the world's first peer-to-peer cryptocurrency. It was invented by a mysterious inventor Satoshi Nakamoto in 2009 and is regarded as the first digital currency to fix the double spend problem.

Bitcoin

A new email-based ransom scam is targeting Google Adsense users with demands for Bitcoin, threatening to flood their websites with junk traffic.

Robert Stevens

Preparing for Bitcoin’s next bull run? Choose your exchange carefully: this week, the crypto exchange giant Binance failed to handle the influx of users piling on Bitcoin’s rising price, suffering from “a number of performance issues,” according to CEO Changpeng Zhao in a Performance Incident Report today. 

Over the past couple of weeks, Bitcoin’s price has hovered at around $10,000, its highest price since September. The result? An influx of activity: Over the weekend, when the performance issues occurred, daily trading volume hit a peak of $50 billion, according to data metrics site CoinMarketCap. In comparison, on January 26, Bitcoin’s daily trading volume was less than half that, at $21 billion. 

And Binance’s daily trading volume was the highest it's been since July, peaking at around $4 billion toward the end of last week, according to CoinGecko, another metrics site. (In July, trading volume hit highs of around $5.6 billion).

Though Zhao said that the exchange was “stress-tested...like crazy in our test environments,” Binance obviously wasn’t prepared for this past week’s influx of users. The exchange overshot things since July, adding computationally intensive features, “thinking we still have 10-100x performance headroom, while in reality, we may be down to 3-5x,” Zhao wrote.

> If you want to know more about what happened. #transparency https://t.co/RxN0wtvlBb
> 
> — CZ Binance 🔶🔶🔶 (@cz_binance) February 17, 2020

The exchange hit a breaking point over the weekend, when users saw intermittent UI errors of “too many requests,” “5xx internal error,” and API timeout errors. Users who saw such errors would likely try to place their trades again, increasing the burden on the system. Work was in place to remedy these problems, but Binance “didn’t finish before the massive traffic hit us just a few days ago,” wrote Zhao.

In addition, its software clogged up: A piece of software that usually pushes out more than 2.5gb of data per second dropped in throughput by a hundred times. The result was that some accounts showed incorrect balances (some indicated that entire portfolios had been wiped out), and processed trades sometimes didn’t appear. Binance also suffered from a shortage of the US dollar-pegged stablecoin, Tether (USDT), as reported by _BeInCrypto_.

To Binance’s credit, Zhao published the report in the name of “#transparency.” But it came at a bad time.

For some users, Binance’s failings might suggest that Zhao’s platform isn’t capable of handling the next Bitcoin bull run. The supply of Bitcoin issued as mining rewards is expected to halve in mid-May—the event is called “The Halvening”—which has historically been associated with a price rise. 

Some believe that the price will rise this time around, too, which could lead to increased volume on exchanges as people try to make the most of the price boom. But following this week’s report, some crypto aficionados might think twice about trading on Binance as the market heats up.

What’s more, Zhao published his report on the same day that Binance launched its white-label crypto exchange solution, Binance Cloud. Customers of the new service can use Binance’s tech, like its matching engine, trading risk controls, and big data security system, while letting Binance “take care of the boring stuff (tech, product, liquidity) for you,” according to Zhao. 

 The $800 million Bitcoin wallet no one wants to touch

But following recent performance problems, potential customers of this service might also think twice. If Binance’s infrastructure has shown difficultly handling an influx of trading activity, could this dissuade customers from renting its system?

On Sunday, Zhao tweeted that the performance problems could be solved “with a combination of short, mid and long term solutions. Not everything can be implemented right away, but they will get done.” With the mid-May 2020 halving looming, Binance has its deadline. 


Binance

<ul>
<li>Binance ran into performance issues over the weekend</li>
<li>This happened after daily transactions volumes more than doubled over the past few weeks</li>
<li>Around the same time, Binance announced Binance Cloud. Will the performance problems dissuade potential customers?</li>
</ul>

The crypto exchange giant Binance failed to handle the influx of users piling on Bitcoin’s rising price, suffering from “a number of performance issues,”

The Stellar Development Foundation, the non-profit behind the Stellar network and eponymous cryptocurrency (XML), announced late last week that it is now a member of the Blockchain Association, an industry trade and lobbying group that’s made up some of the biggest players in crypto, such as Coinbase, Ripple, Kraken, among many more.

The Blockchain Association is a group devoted to preaching the crypto gospel, particularly to Congress and US regulators, in an effort to see the blockchain industry thrive within the United States (as opposed to more lax jurisdictions overseas).

One of the major issues that the Association focused on last year was advancing the “The Token Taxonomy Act,” which aimed to exclude cryptocurrencies “from the definition of a security.” And the Blockchain Association is just one of around 40 groups currently lobbying on behalf of blockchain and cryptocurrency initiatives, according to _CQ_ _Roll Call_, a website that reports on Congress. They spent a combined $42 million lobbying congress in Q1 2019 alone.

“Much of the world's financial system is outdated and unresponsive to the needs of today's consumers,” Kristin Smith, executive director of the Blockchain Association, told Decrypt. “We believe that open blockchain technology will help bring a more inclusive and accessible system, helping build a new system of global trust to meet the expectations of today's savvy digital citizens,” she said.

 Coinbase Custody, Bison Trails join new blockchain lobbying group POSA

“By bringing Stellar on board, we'll be able to leverage their expertise to highlight open blockchain technology's potential in our conversations with policymakers,” said Smith.

Stellar’s general counsel, Candace Kelly, echoed the sentiment in a blog post accompanying the announcement. Kelly said she believes that the Blockchain Association, presenting a unified voice, is fostering an important conversation “by educating policymakers on the benefits of blockchain.”

> We've joined @BlockchainAssn to ensure that the vision for Stellar and its ecosystem has a central place in the public dialogue. SDF's General Counsel, Candace Kelly, shares more about this exciting partnership 👉 https://t.co/yM3MiuxCy7
> 
> — Stellar (@StellarOrg) February 13, 2020

Lobbying groups such as the Blockchain Association are trying to push the US Congress to act fast on blockchain and cryptocurrency and relax certain restrictions, lest rival economies like China take the lead on crypto. China is reportedly moving fast to develop its own state-backed digital currency, and its government has publicly expressed support for the booming blockchain tech industry.

Many players in the American industry are fighting for the US to not be left behind. 

In recent days, the US government has signaled its fear of crypto disrupting the dominance of US dollar, and the Trump Administration is set to release new crypto laws soon. 

While Washington’s conversations around blockchain have “matured,” Smith thinks that many “continue to focus on the technology's well-publicized but overblown negative use cases.” 

Whether Congress is ready to listen might determine whether the United States can catch up to its international competitors in the blockchain race.


politics

stellar

U.S. Congress

Stellar is a cryptocurrency designed to help the world’s unbanked have access to financial services.

Stellar

The organization behind the Stellar network and cryptocurrency has joined forces with a major blockchain trade group, alongside Coinbase, Ripple and others.

Andrew Hayward

Upcoming blockchain-based virtual metaverse game The Sandbox has completely sold out of its second LAND presale, with thousands of additional parcels claimed by buyers who are eagerly awaiting the game’s release.

TSB Gaming’s second presale offered up 6,192 pieces of LAND, the virtual in-game spaces built on Ethereum where owners can eventually create interactive and social experiences in the 3D voxel environment. That’s about 5% of the total amount of LAND parcels in the entire game world.

Publisher Animoca Brands announced late last week that the presale had brought in 800 ETH (worth roughly $206,000 at the moment) within hours of opening up, although it had not sold out at that point. On Sunday, TSB Gaming COO and co-founder Sebastien Borget tweeted that the LAND presale had completely sold through. The company still has limited-edition in-game assets up for sale.

> The Round 2 (5% of our total Map LANDs supply) of @TheSandboxGame Metaverse is💯SOLD OUT‼️
> 💖 A BIG thank you to everyone for your support. Let's build together an AMAZING Blockchain Virtual World! 🚀 pic.twitter.com/6CyglDINgV
> 
> — Sebastien (@borgetsebastien) February 16, 2020

“The success of the first two presales of The Sandbox strongly validates our approach to building a gaming metaverse, showing the growing interest from creators and gamers in the benefits of true digital ownership that will allow them to monetize their future creations within an open economy,” Borget said in a release late last week. “We can see without any doubt that users are ready to jump into our vision of the Metaverse.”

The Sandbox held its first presale in December, selling through more than 3,000 LAND parcels in about four hours. The game features 166,464 total pieces of LAND, each an ERC-721 non-fungible token (NFT), which can be grouped together into ESTATEs for larger-scale in-game creations. Owners can monetize their creations when the game goes live, as well as rent land to other users as desired.

 Nine of the most anticipated blockchain video games

Early LAND buyers have included the Shaun the Sheep brand, Old Skull Games, Dapp.com, CryptoKitties, and My Crypto Heroes, with some partners set to create their own virtual experiences in The Sandbox. A third LAND presale will be announced in the near future, according to Amonica.

The Sandbox began life as a mobile creation game with more than 40 million downloads, according to its publisher, and this new blockchain-driven creation experience is expected to launch later in 2020. It is one of _Decrypt_’s most anticipated blockchain games on the horizon.


Ethereum

Gaming

Ethereum is a cryptocurrency that allows smart contracts and Dapps to operate on its network. It was created by Vitalik Buterin, a Russian/Canadian software developer and is regarded as an evolution of Bitcoin.

The blockchain creation game The Sandbox has already sold about 7.5% of its total property, with brands such as CryptoKitties snatching up parcels.

The IOTA Foundation today released an updated desktop version of its wallet, Trinity, following a hack last week that caused its operators to temporarily shut down the project. Trading activity on the IOTA mainnet remains suspended, but IOTA doesn’t think that its mobile app was affected, and said that hardware wallet users aren’t affected.

In an update on its website, IOTA said that upgrading the desktop Trinity wallet “renders the hacker incapable of accessing your wallet if s/he has not already done so.”

IOTA HACK INVOLVED THEFT OF SEED PHRASES

IOTA determined that the hack, which has affected at least ten people, likely involved the theft of seed phrases. Around $1.6 million was stolen in the hack, according to _BTCManager_.  The hacker got access to the funds by exploiting a bug in the desktop wallet, which has been fixed in the new update.

Law enforcement and cybersecurity experts are currently working with IOTA to identify the hacker. Anyone who has had funds stolen can reclaim them.

IOTA urges users to change their passwords and store them in a password manager. Within the next few days, IOTA will release a tool that lets users transfer all of their tokens to a safe seed. It recommends that anyone who has opened Trinity since December 17, 2019, transfer the tokens. 

> Update: After successfully finding the exploit, the team is currently working on a strategy to mitigate any further risk for token holders and resume complete network operations. More information will be published soon: https://t.co/ME3Cvki3k9
> 
> — IOTA (@iotatoken) February 14, 2020

“By migrating your tokens to new, safe seeds prior to the re-start of the coordinator, you will render the attacker incapable of making unauthorized transfers of your tokens if s/he has not already done so,” wrote IOTA.


crypto

hack

IOTA

IOTA is a distributed ledger technology connecting the Internet of Things (Image: Shutterstock)

<ul>
<li>IOTA has updated its Trinity desktop wallet following a hack last week that saw $1.6 million stolen.</li>
<li>The hacker exploited a vulnerability in the old desktop app that let it access its victims' seed phrases. </li>
<li>The project's mainnet remains offline.</li>
</ul>

Hackers stole $1.6 million by exploiting a vulnerability in the cryptocurrency project IOTA. It has updated its wallet, but the mainnet remains offline.

Mathew Di Salvo

The charity sector is notoriously slow to react to transformative technologies—in the Charity Digital Skills Report 2019, only 12% of UK charities are considering how technological innovations like AI could change their charity. And in the 2019 Global NGO Technology Report, only 34% of NGOs worldwide admitted to understanding blockchain—the lowest stat relating to emerging technologies like the Internet of Things and augmented reality.

Among small charities, though, a revolution is brewing. Spurred on by challenges around infrastructure and dealing with authoritarian states, some forward-thinking organisations are already using cryptocurrency to receive donations. They’re hoping that big charities will catch on, too. 

FEEDING VENEZUELA WITH BITCOIN CASH

With the highest rate of inflation in the world, soaring crime and a shortage of basic goods, Venezuela is an extremely difficult country to live in. It’s also extremely difficult to get money into.

In February 2018, Venezuelan brothers Jose and Gabriel—both longtime users of crypto—discovered Bitcoin Cash (BCH), a fork of Bitcoin. After Jose was quizzed online by friends about the situation in Venezuela, the brothers decided to set up EatBCH, a nonprofit food drive using Bitcoin Cash.
[EatBCH in Venezuela]EatBCH in Venezuela (Image: EatBCH)
Jose, who doesn’t like to reveal his identity due to a fear of reprisals in the increasingly authoritarian state, told _Decrypt_ that, “We were receiving questions from people on Reddit about Venezuela, such as: ‘Is it really that bad?’, ‘Are people really starving’ or ‘How do you manage?’”

“One person told me to send him a [Bitcoin Cash] address so he could send $5 that I could either keep, or use to buy food for kids on the streets.”

PolloPollo: The crypto project putting chicken back on the table in Venezuela
Jose and Gabriel used that $5 to buy a meal for a family – and then some 40 more people. 

They then started asking for charitable donations on Twitter and provided a BCH address to receive the money. The BCH was then sold, used to buy food from local food vendors. The two then posted photos – mainly of children they’d given food to – as proof the cash was being used to feed starving Venezuelans. 

> Working for our communities💪 pic.twitter.com/QqI78TTqUB
> 
> — eatBCH Venezuela (@eatBCH_VE) January 24, 2020

In a country where it is thought a generation of young people will never meet their full physical or mental potential due to malnutrition, the result of a crippling economic crisis, the donations continued to come flooding in. 

To date, EatBCH has received thousands of donations and bought hundreds of meals. They operate in 23 locations around Venezuela and have just launched in South Sudan. Last year they were invited to Washington DC to talk about their strategy with a think tank. 

The initiative is also being noticed by businesses who wish to donate to charity. US-based food startup Crazy Calm, which sells CBD instant coffee, has been donating $5 per order to EatBCH. “It is transparent, efficient charity,” said co-founder Matt Aaron. “We love that EatBCH is using the power of cryptocurrency, borderless cash to feed people in need.” “Our customers love the fact that they can see via the block explorer a link to the donation made on their behalf.”

> 2/9 Update: Mission complete! $500 worth of BCH donated to @eatBCH_SS and @eatBCH_VE.
> 
> Thanks to everyone for participating and most of all @eatbch for their amazing work.https://t.co/g5Tl0EMNtj
> 
> — CrazyCalm CBD Coffee (@CrazyCalmCo) February 9, 2020

Jose added: “When we started this project we said maybe we can accept regular donations in fiat with bank accounts as an alternative. But we simply couldn’t, and cryptocurrency was the only solution.” 

Because of international sanctions, Venezuealans are locked out of traditional payment methods and providers like Western Union and PayPal, he explained. “There is no chance of opening a US bank account so I can receive payments from outside,” Jose told _Decrypt_. “We are simply locked out of the international world. So our only solution is cryptocurrency.”

He added: “I think cryptocurrencies are a better choice than regular financial methods for donating to charity.”

And Jose is not the only one who thinks that. 

CHANGING THE CHARITY SECTOR WITH CRYPTO

Other projects looking to shake up the charity sector by using cryptocurrency are starting to pick up momentum. 

One such project is Giveth, which aims to re-engineer charitable giving, by creating an entirely free, open-source platform built on the Ethereum blockchain. Giveth claims that their system cuts out bureaucracy and provides donors with a high level of transparency and accountability.

“Unlike most things, with crypto you can get financial privacy, but you also get transparency—and you get that by default,” said Giveth founder Griff Green. 

 Griff Green">THERE IS NO REAL USE FOR CRYPTO IN JUST TRANSFERRING MONEY AROUND

“Just being able to transfer money around is not the be all and end all,” he added. “There is no real use for crypto in just transferring money around.” What’s more interesting, he said, is the ability to create economies. 

> “If you’re using #DAOs to do good work in society, people will believe that decentralized governance might actually have some other impact besides just making investors rich.”
> 
> Watch Griff’s full interview on Giveth’s origin story and future roadmap herehttps://t.co/vDmD9TdMQm https://t.co/vdxBBfAht6
> 
> — Giveth (@Givethio) April 26, 2019

Still, there is one challenge for crypto projects looking to overhaul the charity sector, Green said: “The biggest problem that people run into is that no one in the charity space uses crypto; only nerds use crypto.”

GRASSROOTS FUNDING FOR KENYA

One organisation busily engaged in creating economies with crypto is Grassroots Economics, a non-profit foundation based in Kenya. Grassroots Economics works to provide vulnerable communities with alternative currencies, via the blockchain and mobile payments, so that they can take an active role in their own economies. 

> Are #blockchain powered community currencies the 2.0 of cash transfer? #rethinkingaid https://t.co/rdARzTaPL5
> 
> — Grassroots Economics (@grassEcon) May 28, 2019

Grassroots Economics founder, physicist and economist Will Ruddick, moved to Kenya over a decade ago from California. He told _Decrypt _that the charity sector in Africa currently wastes a lot of money with little effect. “The charity sector has a huge impact problem, which has led toward cash transfer or Cash and Voucher Assistance as an emerging modality—essentially dumping cash on vulnerable communities,” he said. “This has opened up the charity sector to faster and more efficient forms of digital vouchers using crypto.”

Grassroots Economics has most recently partnered with the Red Cross and digital wallet provider Sempo to create Community Inclusion Currencies (CICs). CICs enable communities to develop their own media of exchange that can connect to other communities in regional markets and provide a gateway to national currencies via a push button feature phone. As many as 1,000 businesses adopted them in a single week in Kenya. 

“Blockchain gives communities the ability to define and manage a shared financial commons which fundamentally strikes at the heart of poverty,” said Ruddick. 

Though it seems big charity may take a while to fully latch onto using crypto – be it for donations or for creating informal economies – things are moving in the right direction.  

“For me, for the nonprofit sector and for public goods funding in general, cryptocurrency is the bee’s knees,” said Green.


bitcoin cash

charity

Venezuela

Bitcoin Cash was a hard fork of Bitcoin. The split took place in 2017 and since then, Bitcoin Cash has become one of the largest cryptocurrencies to emerge from Bitcoin.

Bitcoin Cash

Deep dives into Web 3.0, future and present.

Features

Among small charities, a revolution is brewing. From South America to Africa, charity projects are revolutionising aid donations and impact using crypto.

Ben Munster

If you support the cryptocurrency Bitcoin SV, there is a land far beyond the blood-soaked trenches of Twitter where you can come to no harm. Where enthusiasts of the Bitcoin fork graze unmolested in fields of plenty; where money flows like spring water from a deep geyser, sparkling and true; where men and women join hands in celebration of a singular investment thesis. The name given to this land, nay, this _paradise,_ is “Twetch.” 

Twetch is a Twitter clone built on the BSV blockchain, founded by developer Randy Moish. Moish originally tried to build a similar platform on Ethereum, among other competitive protocols, but preferred Bitcoin SV. That’s the Bitcoin fork helmed by Craig Wright, the widely maligned Australian computer scientist who claims to be the inventor of Bitcoin.

He would not say how many people are in its community; the number of users is likely miniscule. Still, there is something to it.

Tweets are preserved immutably, they can only be viewed by approved members (there’s a waiting list—get in line!) and you must pay, in BSV, to like, share or comment on another’s post. The app comes with some Twetchy jargon: tweeting is “twetching,” retweeting is “branching,” and, well, that’s pretty much it. (“Twetch” itself is a portmanteau of “Tweet” and “Etch”).

[a typical twetch]

It’s the curious, even sci-fi-esque philosophical undertones guiding Twetch that make it more intriguing. 

TWETCH IS A HOME FOR AN EXILED PEOPLE 

BSV is the dark horse of the cryptocurrency world, which is saying something. A contentious Bitcoin fork that purports to align with “Satoshi’s Vision” (hence the name), BSV has been ostracized from the mainstream Bitcoin “community” ever since its birth-by-hard-fork in late 2018 (it’s actually a fork of a fork, splitting off from first generation Bitcoin fork Bitcoin Cash, rather acrimoniously). Last year, its outcast status was further cemented after a cabal of major exchanges delisted the token from their platforms, in response to Wright’s perceived libel trolling. 

And BSV supporters recently got into a bizarre argument with the Wikipedia founder Jimmy Wales. After Wales agreed to attend a BSV conference, supporters hailed it as approval of the network, to which Wales clarified on Twitter, “I’m coming to speak my mind, which includes that BSV offers nothing for Wikipedia and that there is zero chance we would ever use it.”

Twetch has become a sort of port-in-a-storm for BSV-ers,  and their culture is endemic on the platform: “giveaways” of the BSV coins (whose value recently skyrocketed) proliferate; BSV citizen journalists, embedded in US district courts, report live updates from Wright’s various ongoing legal proceedings; users spell Bitcoin, “BitCoin,” a winking reference to Satoshi’s early writings, as a “signal” to those who believe in BSV’s supposed return to the roots of the protocol; others post screeds on how BSV “won the protocol war,” despite its minimal usage, in BSV’s foremost billionaire-funded propaganda vehicle, CoinGeek. 

“It’s very much a BSV echo chamber at the moment,” said “Mike in Space,” a popular and pseudonymous cryptocurrency pundit, sketch writer and Twetch fan, whose cryptocurrency allegiances fall across the aisles. “For it to succeed it will have to become far more broad in its appeal. That’s very tough as most people in crypto outside BSV will not even touch it. You’re treated like a pariah if you do. I think for it to grow it will need to attract non-crypto communities.”

[a twetch meme, in the wild]

TWETCHIES ADMIRE CRAIG WRIGHT, AMONG OTHER THINGS 

Despite the long-running, is-he-is or is-he-ain’t Satoshi circus, many in the community apparently love Craig Wright. Nevertheless, Moish insists that his use of the BSV chain is motivated purely by technicals: it’s simply the most effective protocol for him. 

“We never really cared if CSW was Satoshi, but he often pointed to things Satoshi said and explained them in a way that made sense to early bitcoiners,” said Moish. “He certainly understands how to scale a blockchain in a way no other individual has succeeded.”

And Wright’s vitriolic public persona?  “No comment,” said Moish. “I am interested solely in building Twetch at the moment.”

It’s a solid plan. If it succeeds, Twetch could demonstrate the potential of the BSV network to regular people, who haven’t yet got much to go on. (Currently, BSV’s most used app aggregates weather data.) Still, to take flight,  Twetch needs users. An ahrefs analysis suggests the site only gets around 62 organic Google searches a month, which isn’t many. 

But its small, like-minded community is highly engaged, and awaiting the second coming, as rapt as a cargo cult. 

“I think that since Twetch is a BSV project, obviously BSV users are the low-hanging fruit for Twetch to pursue as early adopters,” said Kurt Wuckert Jr, an entrepreneur adrift in the BSV space, and an enthusiastic Twetcher. (He was the author of the “protocol war” op-ed). 

Yet Wuckert insists that Twetch is more than a mere echo chamber, and that “there are even a surprising number of people from outside the general cryptosphere that have joined simply to do some reconnaissance—but who are from the non-crypto social media industry.”

Mike in Space is one of these, as is Joshua Davis, alias “Karbonbased,” a former provocative tweeter who was ousted from that platform after an imbroglio involving a DCMA takedown. Although Twetch isn’t censorship-resistant, and Davis is certainly no BSV fluffer, he nevertheless sees value in the experiment.

“The biggest hurdle they have to tackle is attracting and maintaining more active users,” Davis said. “At times it feels slow on the platform as far as engagement but I’ve always said that Twitter’s only moat is it’s users.”

Davis said he has more followers on Twetch than on Gab, the far better known alt-Twitter known for nurturing antisemtic killers. “I post more on Twetch than I ever have on Gab,” he said.

Similarly, Ryan X. Charles, who runs Money Button, the BSV-powered online payments app that handles Twetch transactions, says that many people turn up simply to escape the awfulness of Twitter. 

“Crypto Twitter is a shit hole,” he said. “I recommend everyone quit using it. It makes you dumber.”

“Twetch,” he added, “is a place to communicate unmolested. The fact that the cryptocurrency industry relies so deeply on Twitter is an indictment of the fact that it is mostly a scam industry—scammers and criminals are great at populism. Twitter encourages this. Twitter is a part of the problem.”

[A Twetch user]

On Twetch, trolling doesn’t pay—it costs. “Twetch forces you to be more thoughtful with each reply as it literally costs you money,” said Mike in Space. “That friction, even though small, does have an impact and I think raises the level of discourse. If you want to troll someone, for instance, _you need to pay them for the privilege._”
[Twetch’s incentive model doesn’t always motivate thoughtful posting.]Twetch’s incentive model doesn’t always motivate thoughtful posting. 

TWETCHIES PONDER IMMORTALITY AND IMMUTABILITY

But Twetch’s founder, Moish, believes that Twetch’s appeal lies in what it offers in the way of achieving immortality. 

It comes down to Twetch’s central feature, the immutability of users’ posts. “Twetch is an oasis because people think twice about what they post—because their words will live on chain,” said Moish. And this seems to cause the community to spend a lot of time thinking about the future and the Great Hereafter...

Twetch users, indeed, post a _lot _of stuff about eternal life on the platform, more than you’d expect on a social network. “Twetch is the on-ramp for consciousness immortalized,” writes one user. It's an “unalterable ledger on which we can securely upload consciousness,” wrote Moish himself, in a recent-ish post. 

“The blockchain will ultimately store all data that has value—your Twetch profile will be a way to remember you after you're gone.”

[twetch users like immutability.]

He’s not kidding with the sci-fi stuff. BSV supporters want everything you do, say and feel to be uploaded to the blockchain, logged and filed like numbers in a bookkeeper’s ledger. This philosophy, deeply at odds with the mainstream Bitcoiners’ pro-privacy ethos, is also the philosophy behind Wright’s ambitious “Metanet,” announced early last year, which proposes to uproot the internet and rebuild it from scratch on BSV. Twetch, in the grand scheme of things, would be the first, tentative step toward that lofty goal. 

“The idea is that everything you do, both online and in real life, will be a transaction on the blockchain,” explained Moish. “When everything you do is accounted for you are incentivized to act in a way that is honest and good for the network as a whole.”

The payments aspect plays into this, too. “Basically it becomes an economic incentive to act in a way that benefits the network (in this case the entire world),” he said, likening the possibilities afforded by Twetch to the realities presented in recent sci-fi fantasy such as Ready Player One, and Altered Carbon, a show where “consciousness can be transferred to different bodies,” according to Moish. “Things like walking an old lady across a busy street will be rewarded financially, so people will be more likely to act in that manner.”

There’s almost a surveillance capitalist flavor to all of this, albeit tempered by software engineer optimism. It’s a Panopticon for the digital age, built by and for those who would typically advocate for privacy. A life immutably surveilled, the BSV supporters say, is a life well lived. And now you know where to find them. 


cryptocurrencies

twetch

Bitcoin SV stands for Satoshi Vision.

Stemming from Bitcoin Cash and claiming to be the "original Bitcoin," BSV is a hard fork from BCH after the network upgrade scheduled for November 15th, 2018 resulted in a hash war determining the chains would be split. According to their website, the Bitcoin SV project is primarily backed by CoinGeek Mining with development work by nChain.

Bitcoin SV

Where Bitcoin SV fans go to escape online harassment  - Decrypt

Twetch is an online oasis for BSV enthusiasts, but there's more to it than that. Ben's Bugger Bin ponders the meaning of it all.

Where Bitcoin SV fans go to escape online harassment

Thomas Newman liked the idea of customers at his graffiti gallery in Asker, Norway, paying for things in Bitcoin. So, nearly a year ago, he purchased an XPOS, a mobile point-of-sale device that would allow his clientele to easily use Bitcoin to buy cans of spray paint, or murals.

But now the thing is gathering dust. “Norwegians are not really ready to embrace blockchain technology,” said Newman, who runs an online storefront and showroom, Montana Cans. “It works magnificently, it’s a great machine, it has amazing potential ... But if the customers are not willing to actually use crypto to pay for stuff, what’s the point?”

It's not just Norwegians. Hardly any consumers, anywhere in the world, are ready to use crypto as a payment scheme, if the experience of Pundi X—which manufactures the XPOS—is anything to go by.

PUNDI X'S DREAM

The company, known as a fintech innovator, was an ICO high flyer after it raised $34 million in January, 2018, and an “emerging star” in KPMG’s FinTech 100 report. It had ambitious plans to sell more than 100,000 of its crypto POS terminals by 2021. But so far, large-scale retail adoption hasn’t taken hold and lucrative deals that the company has announced, for upwards of $17 million worth of devices, haven’t yet materialized. Indeed, of the 100,000 terminals it expected to ship, only a few thousand have moved. A scant 1,000 are “activated” today, the company told _Decrypt. _

Among the largest and best-publicized point-of-sale companies, Pundi’s strategic misfires make it a bellwether for an industry which has struggled to find users. But although the company acknowledged its lackluster performance, it remains optimistic that “if you build it, they will come,” as co-founder and CEO Zac Cheah said in late 2018.
Pundi X co-founder and CEO Zak Cheah
“As of today, over 1,000 XPOS [have] been activated,” Judie Liu, a Pundi X spokeswoman, told _Decrypt_. She said that despite the modest number of machines in use, “in 2019, we have handled 22.6 million USD worth of crypto transactions across XWallet, XPOS and XPASS cards.”

“We do believe that all the currencies will eventually move to the blockchain,” she added. “The XPOS platform plays an important part in facilitating speedy blockchain-based transactions in physical retail outlets.”
[Screen Shot 2020 02 10 at 5.38.27 PM]Pundi X's XPOS and smart card. 

A SHORT HISTORY OF PUNDI X

Pundi X was co-founded by Cheah, a former staffer at Opera Software, among other places. It started in Jakarta, where it pioneered the use of QR code-based cashless payments, via an app called Pundi-Pundi. In November, 2017, as the crypto bubble was burgeoning, Pundi “unveiled” the XPOS system, which was reportedly based on the Pundi Pundi app. A company press release said the XPOS aimed to be in 700,000 stores across Asia, and could one day reach a global market of 100 million people.

The company relocated to Singapore a year later, due to Indonesian’s tough regulations around using crypto for payments, to work full bore on the XPOS network. Its work drew coverage in cryptocurrency trade publications, as well as glossy, mainstream papers.

It subsequently published a white paper outlining its ambitious plan: Building an open-source network on a proprietary blockchain, Function X, that would facilitate crypto-to-fiat transactions, via a mobile application, a contactless smart card and point-of-sale (POS) terminals. 

At the heart of the network was the XPOS, a roughly $300 hand-held device that can easily handle the transactions in stores. The company hoped to manufacture and distribute 100,000 XPOS units to over 25 countries by 2021. It said the product would help bring about the “rapid mainstream adoption of cryptocurrencies and the merging of the crypto-economy ... with the much larger mainstream economy.”
The Pundi X white paper.
Newman, of Norway, was among thousands of crypto diehards worldwide who bellied up to buy Pundi’s “NPXS” tokens—175 million sold at Pundi’s January 21, 2018 ICO.

Early demand for the network appeared to be brisk: The company announced a number of high-profile deals, including a plan to build and ship 20,000 customized terminals—paid for with $17 million worth of privately raised cash—in April, 2018.

But Pundi X never built the devices. 

BAD TIMING FOR PUNDI

Pundi’s timing couldn’t have been worse. Token prices imploded soon after its launch, posing a challenge for its new business. The $17 million "private placement" committed Pundi to manufacturing 20,000 bespoke “NEM XPOS” devices, payment terminals wired to exclusively support NEM’s token, XEM. Though Pundi announced in a report that it had “fielded orders” for the units, the plan was scrapped when Pundi X decided to stick with the standard XPOS unit, which would support XEM regardless.

“The distributors and merchants [only] want one blockchain-based point-of-sale terminal,” said Liu.

NEM Foundation CEO Alex Tinsman declined to comment, saying the deal had been negotiated by her predecessor, Lon Wong. Wong said that he did indeed push for the collaboration but, “there was no formal partnership per se then.” Wong added that after he left “I don’t think there was any follow up” by the Foundation.

Likewise, in June 2018 Pundi X announced that another payments company, the Switzerland-based UTrust, had committed to acquiring 1,000 devices. “Today’s deal with UTrust takes the number of units of Pundi X technology that have been ordered for use by clients in global retail to over 25,000, or over one-quarter of the company’s three-year sales target of 100,000 devices,” the company said at the time.

But UTrust’s CEO, Nuno Correia, told _Decrypt_ that ultimately, no units were shipped, and no money changed hands, “due to legal constraints in the jurisdictions we are headquartered [in].” He added that in the end, UTrust “decided to work on our own POS application that does not require a native hardware device."

Liu nevertheless maintains that, "for UTRUST, they’ve committed to acquiring 1,000 units of Pundi’s XPOS in [a memorandum of understanding]."
[Screen Shot 2020 02 10 at 11.15.00 AM]Pundi's planned but never delivered NEM XPOS
Add to these disappointments Pundi’s announcement in October 2018 that the government of Dubai would use XPOS devices in “hundreds, ... if not thousands” of Dubai stores for “Emcash,” a large-scale digital payments infrastructure that would allow residents “to make digital payments for school fees, bills and retail purchases with a stable, digital currency.”

That plan involved a partnership with Ebooc, a payments company, and Emcredit, a state-backed subsidiary of the Dubai Department of Economic Development. Dubai even appeared to grant Pundi X regulatory approval.

 “Zero progress has been observed or communicated to the Pundi community about this.” .

“I bought NPXS [Pundi’s token] after this happened,” said Jason Rouse, a Dubai-based investor. “I viewed the Pundi Dubai deal as one of the biggest deals in the crypto world. The possibility was there for crypto to be spent in retail outlets in Dubai.”

Yet Rouse is disappointed. A year and a half on, there's nothing to show for it, he said. “Zero progress has been observed or communicated to the Pundi community about this.” Ebooc, meanwhile, is listed as "inactive" in records; its website is now defunct.

Liu however said that the deal “remains unchanged,” and that Pundi X is continuing its work under the aegis of a different government agency, the Department of Digital Force Pro Information Technologies. Pundi X still displays the deal on its website.

Unmoved, Rouse said: “It’s a lot of hype with zero follow through, so far.”

Neither Ebooc, Emcredit, nor the Dubai Department of Economic Development could be reached for comment.

XPOS IS A WORK IN PROGRESS

Pundi’s spokeswoman, Liu, admitted that, when it came to the NEM and UTrust partnerships, it had been a mistake to characterize the large orders as done deals, as it still does on its website—when in reality they often took between one and three years to process. The company has resolved not to announce large shipment orders anymore: “We learn[ed] that it takes time.”

The upshot is that Pundi X appears to be far from its 100,000 target. Promotional materials still say that more than 5,000 devices have shipped to more than 25 countries. When questioned, however, Liu qualified that, saying the figure actually refers to the number of units “pending shipping”—that is, in stock, but not shipped.

So how many _have_ shipped? Liu would only reiterate that “one thousand are live.”
[Screen Shot 2020 02 10 at 2.39.12 PM]Pundi's website says it's shipped more than 5,000 units 

XPOS SALES INFO THUS FAR

As for the units that were shipped, some wholesalers have found them difficult to shift, while retailers have reported mixed results. In late 2018, Pundi X unveiled the “World’s First Crypto Street”—it said it distributed devices to nine shops in a shopping district in Singapore. Today, five of the businesses are marked as “permanently closed” on Google Maps, and only one vendor, Yixing Xuan Teahouse, claims to still own an XPOS.

It “works well,” the vendor said, before hanging up.

Two vendors, meanwhile, didn’t respond, and Ronald Lim Chun Loong, the restaurant manager at another, Sen of Japan, said that “management had decided to stop [using the machine] entirely.”

Wholesalers, meanwhile, are selling devices, albeit slowly.  Crypto news site Bitcobie says it purchased 200 last June, but has sold only 40, while Ethereum startup MakerDAO claims to have given away 70 out of the 750 that it subsidized, having agreed to split the bill with Pundi on the order. (Although Liu disputes this figure, saying none have yet been dispatched.)

Both companies maintain, however, that they still believe in Pundi X’s technology. “Pundi X is doing a great job in Latin America,” said Mariano Di Petrantonio, MakerDAO’s community lead there. “They have a very clear understanding of what’s going on in each country.”

A LACKLUSTER CONSUMER REACTION

Pundi X says that it has already sold XPOS units in more than 25 countries. Liu, the spokeswoman, referred to an online map of 121 retailers that have “self-reported” their presence online.

But some of those retailers told _Decrypt_ that the devices are hardly being used. And others say they ditched their units outright.

“We were very excited to get the unit and to have it advertised on our site and in our physical store,” said Christiaan Boshoff of Filtershop, in South Africa. “Unfortunately in the last 6 months, we have only had people come in and ask if it is a good idea to buy Pundi’s coin and not a single customer wanting to pay using crypto.”

“So overall it is a nice platform but in our case, it has had zero use.”

The phone numbers for 45 of the businesses were no longer functioning. Of the 18 that responded, 11 said they had owned a device but abandoned it. Five denied ever having received one, and two said that, at best, roughly two or three customers used the device each month.

THE REGULATORY CHALLENGE

A rep at Dirty Bar, a nightclub in Malaysia, told _Decrypt _that it received a device but had to return it immediately, because it lacked the certification required to transact crypto in the region.

Liu said that difficulties with compliance had made distributing the machines slower than expected. “In Malaysia, crypto has been recognized as security by the government, despite the fact that tokens listed on XPOS are utility tokens,” she said. “Nonetheless, we have decided to withdraw XPOS operation from this market to avoid potential legal complications.”

She added that, broadly, “crypto adoption” is still in its infancy. “Compared with fiat, crypto transactions are still not common today,” she said. “In some countries, the bear market and tightening regulations have hindered the crypto adoption.”

She did, however, echo MakerDAO’s assertion that there is far more uptake in Latin America, where the need for alt-currencies is apparently more urgent.

STILL BUILDING AND WAITING FOR THE CROWDS

For now, the company, which employs around 100 people according to Liu, is working to keep merchants engaged.  A major upturn in crypto ought to help the market for POS devices. In the meantime, Liu told _Decrypt_ that Pundi is currently allowing vendors who use the XPOS terminals to keep the transaction fees, as a goodwill gesture.

Though sales might be in the doldrums, the company itself acknowledged on Telegram last year that it sells off tranches of its circulating token supply, currently capitalized at $42 million, to finance itself.

“You think businesses run on air?” replied Markus LeBlanc, a group administrator who represents Pundi.
[Screen Shot 2020 02 11 at 15.04.37]Some investors want to see more revenue from sales.
Liu said that the company was also generating revenue from transactions on both XPOS devices and the adjacent XWallet, hardware sales, decentralized applications (DApps), enterprise solutions, and “open platform operations.”

“We know that the industry is at its early stage; therefore, we've been very cautious about spending since day one,” she said. “Yes, we are confident in our finances.”

So, Pundi soldiers on. Indeed, if anything, the company is doubling down, and recently showed off its new blockchain-based mobile phone, at CES in January. The so-called BOB, which Cheah says will run on Pundi’s own proprietary blockchain (it currently supports multiple blockchains), was a massive hit. It even won a CES Innovation Award.

It has a way to go. On January 10, the company reached another, sadder milestone: its proprietary crypto-token, NPXS, hit its all time low price of one millionth of a Bitcoin, roughly $0.0001.


Editors' Picks

pundi x

Inside Pundi X's troubled plan to take Bitcoin mainstream - Decrypt

The innovative fintech company launched two years ago with a $34 million ICO and an ambitious plan to equip thousands of retailers with crypto POS terminals for Main Street users. So far, it hasn't turned out that way.

Inside Pundi X's troubled plan to take Bitcoin mainstream

Melanie Kramer

Cryptocurrencies, utility tokens, security tokens and more…digital assets and their classifications are evolving right alongside cryptographic and blockchain technology. Non-fungible tokens, or NFTs are another example of the fast-paced change in the industry. In this guide we explore what they, how they work, and how they're being used. 

WHAT ARE NON-FUNGIBLE TOKENS?

Non-fungible tokens contain identifying information recorded in their smart contracts. It’s this information that makes each different and as such, they cannot be directly replaced by another token. They cannot be swapped like for like, as no two are alike. Banknotes, in contrast, can be simply exchanged one for another, if they are the same value, there is no difference to the holder.

Bitcoin meanwhile, is a fungible token. You can send someone one Bitcoin and they can send one back, it would still be one Bitcoin. The value might change depending on the time between exchanging Bitcoin, but it's essentially the same. You can also send or receive any part of a Bitcoin, measured in Satoshi, as fungible tokens are divisible.

Non-fungible tokens are not divisible, in the same way as you cannot send someone part of a concert ticket. Part of a concert ticket wouldn’t be worth anything on its own and would not be redeemable.

CryptoKitties collectibles were some of the first non-fungible tokens. Each blockchain-based cat is unique, if you sent someone a CryptoKitty it would be a completely different one if you were sent one in return, unless they returned the exact same one.

The unique information of a non-fungible token, like a CryptoKitty, is stored in its smart contract and immutably recorded on the token’s blockchain. CryptoKitties are Ethereum ERC-721 tokens, they use Ethereum’s protocols and the Ethereum blockchain.

In late 2018, one player was so desperate to move to a "better location" in the virtual game Decentraland that they were ready to say goodbye to 2,800,000 MANA in order to purchase a land piece in-game. At the time of the deal, that was equivalent to over Ξ1000 or $215,200. 

WHAT MAKES NFTS SO SPECIAL?

Non-fungible tokens have unique attributes, they are usually linked to a specific asset. They can be used to prove the ownership of digital items like game skins right through to the ownership of physical assets.

Other tokens are fungible, in the same way as coins or banknotes. Fungible tokens are identical, they have the same attributes and value when exchanged.

HOW ARE NON-FUNGIBLE TOKENS USED?

As well as for crypto-collectibles like CryptoKitties, non-fungible tokens can be used for digital assets that need to be differentiated from each other in order to prove their value, or scarcity.

Another example of a non-fungible token is Decentraland’s LAND token. Decentraland is a blockchain-based virtual world, similar to Second Life. Each LAND token represents a parcel of virtual land in Decentraland identified by its virtual world coordinates.

SuperRare is another blockchain project creating non-fungible tokens that allow digital artists to link a token to an image or GIF they have created. A token represents ownership of the digital art and allows the creator to also retain and record their copyright and IP. The tokens, and hence the art, can be bought and sold just like physical artwork.

Non-fungible tokens are not traded on standard cryptocurrency exchanges, instead they are bought or sold on digital marketplaces like Openbazaar or Decentraland’s LAND marketplace.

HOW DO NFTS WORK? 

Tokens like Bitcoin and Ethereum-based ERC-20 tokens are fungible. Ethereum’s non-fungible token standard, as used by CryptoKitties and Decentraland, is ERC-721. Non-fungible tokens can also be created on other smart-contract enabled blockchains with non-fungible token tools and support. Though Ethereum was the first to be widely used, NEO, EOS, and TRON, now have NFT standards.

Non-fungible tokens and their smart contracts allow for detailed attributes to be added, like the identity of the owner, rich metadata or secure file links. The potent of non-fungible tokens to immutably prove digital ownership is an important progression for an increasingly digital world. They could see blockchain’s promise of trustless security applied to the ownership or exchange of almost any asset.

As is the challenge of blockchain to date, non-fungible tokens, their protocols and smart contract technology is still being developed. Creating decentralized applications and platforms for the management and creation of non-fungible tokens is still relatively complicated. There is also the challenge of creating a standard. Blockchain development is fragmented, many developers are working on their own projects. To be successful there may need to be unified protocols and interoperability.

THE FUTURE

Predominantly, non-fungible tokens are being implemented in gaming and crypto collectibles. For gaming, non-fungible tokens could be used to represent in-game items like skins, potentially allowing them to be ported to new games or traded with other players.

Their potential however is much wider with possible application to copyright and intellectual property rights, ticketing and the sales and trading of video games.

Non-fungible tokens add potential to the creation of security tokens, the tokenization of both digital and real-world assets. Physical assets like property could be tokenized for fractional, or shared, ownership. If these security tokens are non-fungible the assets ownership is completely traceable and clear, even if only tokens representing part ownership are sold.

Further application of non-fungible tokens could be certification such as for qualifications, software licensing, warranties, and even birth and death certificates. The smart contract of a non-fungible token immutably proves the identity of the recipient or owner and could be stored in a digital wallet for ease of access and representation. One day, our digital wallets could contain proof of every certificate, license, and asset, we own.


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Non-fungible tokens, or NFTs, contain identifying information recorded in their smart contracts. It’s this information that makes each different.

Many new stablecoins have emerged over the past 18 months in the cryptocurrency space. Their development has partly been inspired by the need to fill a potential stablecoin void, as the first and most commonly utilized stablecoin Tether faces concerns. There is, of course, also ongoing impetus in the cryptocurrency space to develop less-volatile tokens which will be used more widely. Below we take a closer look at Maker, the governance token at the heart of MakerDAO. 

WHAT IS MAKER?

The Maker (MKR) token was created by MakerDAO and its primary purpose is to support the stability of MakerDAO’s DAI token and enable governance for the Dai Credit System. Holders of MKR make key decisions on the operation and future of the system.

MakerDAO has two tokens, MKR and DAI. The DAI is a stablecoin designed to provide an alternative to more volatile cryptocurrencies, as well as a new type of financial system. The MKR meanwhile, is used to keep the DAI stable. Traditional stablecoins use reserves of fiat currencies or even gold to peg a cryptocurrency to the value of these real-world assets to keep it stable. But that has proved problematic. MakerDAO uses the MKR token to act as a counterweight to price fluctuations. 

 Some stablecoins gain their lower volatility by being backed by fiat currencies and physical assets. Other stablecoins can be controlled through blockchain-based mechanisms or algorithms to maintain a required value.

WHAT MAKES IT SO SPECIAL? 

The MKR token helps to keep its partner stablecoin DAI at the same value as $1. MKR can be created and destroyed in response to DAI price fluctuations in order to maintain DAI’s dollar-equivalent value. DAI uses a system of collateralization (essentially insurance), whereby holders act as part of the controlling mechanism to help manage the network.

DAI is issued when buyers purchase a smart contract based collateralized debt position (CDP) which behaves much like a loan. CDPs are bought with Ether (ETH) and DAI is given in return. ETH acts as the collateral to the loan, in much the same way as a house acts as collateral for a mortgage loan.  The system means that individuals can, in essence, obtain a loan against their ETH holdings. When the loan is repaid the DAI is “burned” or destroyed. Fees occur in MKR along the way.

The MKR token is a solution for a scenario where the price of ETH falls too quickly for the DAI system to handle. If the collateral system is not enough to cover the value of DAI then MKR is created and sold to the market to raise additional collateral.

The Maker Platform, formerly known as MakerDAO is the protocol and governance framework for DAI and also MKR. The platform is a decentralized autonomous organization (DAO) on the Ethereumblockchain.

 Smart contracts are simply computerized code which contains, and can perform, a set of instructions.

WHAT CAN YOU DO WITH MAKER?

Holders of MKR gain voting rights in the Maker platform’s continuous approval voting system. MKR holders vote on things like the collateralization rate of CDPs. For participating they gain MKR fees as a reward. These holders are incentivized to vote in a way that benefits the system. If the system works well MKR’s value is maintained or increases. Poor governance would devalue MKR.

MKR is an ERC-20 token, constructed using Ethereum’s protocols. It can be stored in ERC-20 wallets and is tradeable on a number of exchanges.

WHO CREATED MAKERDAO?

MakerDAO was founded in 2014, in California, by developer and entrepreneur Rune Christensen. Its core management and development team is 20 strong. After three years in development, MakerDAO finally launched the stablecoin DAI.

MakerDAO hope to create both a reliable stablecoin in DAI and a system of fair credit for everyone. Opening a collateralized debt position (CDP) using Ether means DAI can provide liquidity against crypto-assets.

A BRIEF HISTORY

 	* 2014 – Maker DAO founded
 	* August 2015 – MKR token launched
 	* December 2017 – DAI stablecoin launched on the Ethereum mainnet
 	* October 2018 – DAI becomes the first cross-chain ERC-20 token on Wanchain
 	* September 2018 – Kraken lists MakerDAO's Dai.
 	* October 2019 – Ledn uses MakerDAO to disburse loans to the unbanked.
 	* December 2019 – Maker Foundation transfers control of MKR to Maker Governance.

THE FUTURE

MakerDAO’s efforts to create a stablecoin without concerns over reserve-backing are credible. With the collateralization mechanisms and the further failsafe of MKR, MakerDAO has a system to protect the value of its stablecoin DAI which could lead to its wider use.

As a further failsafe, MakerDAO has an emergency process called “global settlement.” Should something go wrong with MakerDAO’s system, a group of individuals holds settlement keys. These can be used to trigger a settlement where collateral held in CDPs is released to DAI owners in the equating value of Ether.

MakerDAO also works hard on transparency, it shares its regular meeting recordings online. As DeFi or decentralized finance became one of the biggest success stories in 2019, MakerDAO, and its MKR token are in the front line of this growing industry. 


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A 3-minute guide to the governance token - Decrypt

The Maker (MKR) token was created to support the stability of MakerDAO’s DAI token and enable governance for the Dai Credit System.

Ki Chong Tran

There’s only one Mona Lisa, only so many Picassos, a limited supply of gold on Earth. The inventor of Bitcoin believed scarcity could create value where there was none before. The Halving also known as the Halvening is due to occur sometime in May 2020. To understand it, we must understand the theory behind Bitcoin’s supply. Below we explore more. 

A BIT ABOUT BITCOIN

Bitcoin is revolutionary because it proved–for the first time–how something that was completely digital could be scarce. This limited supply is one of the primary reasons the price of Bitcoin has gone from being worth nothing 10 years ago to being priced at $20,000 per coin at its peak. 

PROBLEM

Fiat currencies such as the U.S. dollar were initially created with firm rules–to create one U.S. dollar, the U.S. government needed to have a certain amount of gold in their reserves. This was known as the GOLD STANDARD. Over time, these rules eroded as modernizing economies, during bouts of extreme financial certainty–like the Great Depression and World War II–printed more money to help stimulate struggling economies. This change in tac is precisely the kind of thing Satoshi Nakamoto wanted to avoid. He/she/they had seen that this devaluation of fiat money could have disastrous effects, and so, with code, prevented any single party to be able to print more Bitcoin. 

WHAT IS THE HALVING?

The Bitcoin code is embedded with a hard supply limit of 21 million coins. New Bitcoin is created through mining as block rewards. Miners do the work of maintaining and securing the Bitcoin ledger and as a reward; the system sends them new Bitcoin.

However, about every four years, the mining reward is halved–hence “the Halving.” Each halving reduces the rate of new Bitcoin entering into the supply until no more new Bitcoins are created at all in the year 2140.

WHO INVENTED THE HALVING?

The Halving was programmed into Bitcoin’s code by Satoshi Nakamoto. This extremely simple mechanism of reducing the total supply over time is one of the main reasons why Bitcoin is the world’s most valuable crypto asset. As Nakamoto wrote in the Bitcoin whitepaper: “the network is robust in its unstructured simplicity.” 

 The first million Bitcoins were mined by Satoshi Nakamoto 10 years ago. Since then, about 85% of the total supply has been mined and only about 3 million more Bitcoins will ever be created.

A BRIEF HISTORY

 	* 2009 – Bitcoin mining rewards start at 50 BTC per block
 	* 2012 – The first Bitcoin Halving reduces mining rewards to 25 BTC
 	* 2016 – In the second Halving, mining rewards go down to 12.5 BTC
 	* 2140 – The 64th and last Halving occurs and no new Bitcoin will ever be created

WHAT’S SO SPECIAL ABOUT IT?

If a person, group, or government is trusted to set up the money supply, they must also be trusted to not mess with it. Bitcoin is supposed to be decentralized and trustless–no one in control and no one to trust. Since Bitcoin is not controlled by any one person or group, there must be hard-set rules about how many Bitcoin gets created and how they are released. 

By writing a total supply and Halving event into the Bitcoin code, the monetary system of Bitcoin is essentially set in stone and practically impossible to change. This “hard cap” means Bitcoin is a kind of “hard money” like gold, which has a total supply that is also practically impossible to change. 

WHAT HAPPENS TO MINERS?

Miners must use precious resources to maintain the Bitcoin network, but what happens when their rewards are halved? Since the Halving reduces mining rewards, the incentive for miners to work on the Bitcoin network would also be reduced over time, which would mean fewer miners and less security for the network. In order to compensate miners properly into the future, the price of Bitcoin or the transaction fees must go up to meet miner’s demands.

HOW DO YOU TAKE ADVANTAGE OF THE HALVING?

According to the laws of supply and demand, the dwindling Bitcoin supply will inevitably lead to increasing Bitcoin demand, leading to a rise in prices. The best way to take advantage of this is of course by buying Bitcoin. As the leading and most popular crypto asset, Bitcoin can be easily purchased on nearly any crypto exchange as well as mainstream products such as the Cash App. Historically, after previous halving events, the price of Bitcoin did go up, but not necessarily straight away. Many Bitcoin watchers are hoping the same happens again.

THE FUTURE

The Halving may have a huge impact on Bitcoin’s price according to some “experts.” Cryptocurrency-focused research company, Digital Asset Research created a prediction model setting Bitcoin at over $60,000 after the next Halving in May 2020. A German bank went even further and predicted a price of $90,000 per Bitcoin after May 2020. But the truth is, no one knows for sure. 

It has been argued that since the Halving is well-known and highly predictable, the event has already been calculated into Bitcoin’s price by most investors. 

_DISCLAIMER: THIS IS DEFINITELY NOT INVESTMENT ADVICE. PLEASE DO YOUR OWN RESEARCH AND DON’T BELIEVE EVERYTHING YOU READ ON THE INTERNET. _


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A 3-minute guide to the event - Decrypt

The Halving also known as the Halvening is a slashing of the rewards miners receive while processing transactions on bitcoin.

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