WAX Token Sale Set to Disrupt the $50 Bln Virtual Asset Trading Industry

725_Ly9jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy8yYmJkMzdiNWNiYjRiNzkwM2JmODY5YjUxYWM4MzM0Mi5qcGc=.jpg

This article was originally printed in CoinTelegraph here. We've reprinted on our blog because WAX represents a very important investment in CAM's Crypto Asset Fund.

--

The Worldwide Asset eXchange Token Main Sale is opening today. Many experts agree that this could well be the last big sale of 2017. What makes WAX so special in today’s cluttered and noisy token sale market? A number of things, but most importantly -- the industry in which it operates. WAX is ready to disrupt one of the most lucrative markets in the world. Over 400 mln gamers worldwide currently trade “skins,” making up an industry that is currently worth over $50 bln dollars. These “skins” are virtual goods which customize the way certain in-game objects, such as characters and weapons, look. Although skins have been part of the gaming community for a long time, trading them has gained massive traction only in recent years, but many problems remained -- that is, until WAX came along.

Skin trading: a background

In-game skins have been around for a long time. In essence, a skin serves a single purpose: it makes items and characters within the world look unique. The value of an extensive collection of skins is very similar to the value of a collection of shoes or baseball cards in the offline world. They are a source of pride for the owner and a source of respect and envy for others within the community.

Up until 2011, gaming skins could not be traded -- they were only available through a random drop in the game. Steam changed everything that year by giving people the ability to trade skins with each other when they announced the Steam Trading Beta for Team Fortress 2 (then the game with one of the highest player bases on the platform). Once the popularity of the beta became apparent, the Steam market opened in 2012, associating skins with particular monetary values for the first time.

However, there was a significant limitation: any money earned in the Steam market was confined to the Steam market, meaning that you could not use this money anywhere else. This became a noticeable issue once various skins became highly sought-after items. Although a wide variety of skins are traded for a few cents or a couple of dollars a piece, a significant minority of them can trade for hundreds, thousands or even tens of thousands of dollars. Many online gamers saw this lock-up as a significant hindrance and took trading out of the Steam Marketplace and into the realm of peer-to-peer trading, only to be faced with a much bigger problem: fraud.

Gamers today rely on centralized online marketplaces to trade their items. This means that gamers rely on third-party service providers for these transactions. They consign their goods to a marketplace where the goods are kept safe until the transaction is processed. OPSkins is the largest of these virtual asset marketplaces in operation today and is growing at a rate of 200,000 new users register on it every month. OPSkins provides a space where gamers can trade items with the knowledge that sellers and buyers aren’t going to get scammed.

Ripe for Blockchain disruption

OPSkins has eliminated user risk through careful management of its platform, but some significant challenges to company and industry growth remain. The virtual asset trading industry, as constituted today, cannot unleash its true potential for growth. While platforms like OPSkins allow users to trade with incredible efficiency within a single platform, the centralized nature of the service does not allow virtual goods traders and gamers to transact outside the platform with the same level of efficiency and security.

There are several major reasons for this, including a lack of liquidity within smaller virtual goods trading sites, the lack of a common trading method for different games that prevents assets being traded on a directly exchangeable basis and the lack of sufficient variety within buyers and sellers to ensure a market for every potential virtual good. While centralized marketplaces work well, they only work to a point.

Decentralized marketplaces seem to be the solution to OPSkins’ scalability challenges. However, decentralization comes with its own set of obstacles. Decentralized marketplaces are difficult to launch. Without an Application Programming Interface (API), there’s no standardized way of trading between games, which makes things confusing and complicated. Additionally, setting up a trading interface is not a cheap venture, and high costs discourage many would-be entrepreneurs from selling their virtual items independently. Because of these barriers to creating a cohesive decentralized marketplace, it’s proved basically impossible to generate a large enough base of buyers and sellers which could ensure the level of supply and demand needed to have a functioning market.

WAX: the next big thing

To unleash this market’s full global potential, the team behind OPSkins is launching WAX – the Worldwide Asset eXchange. WAX is a peer-to-peer trading protocol for the virtual assets market. It innovates on a foundation of Blockchain technologies and smart contract tokens to allow buyers and sellers to trade efficiently without the need for middlemen. Importantly, it draws on its founding team’s experience to cater precisely to the market’s needs, resolving some of the industry’s most pressing problems.

WAX enables anyone to operate a fully functioning virtual marketplace, with zero investment in security, infrastructure or settlement. With the inclusion of WAX’s simple marketplace widget, video gamers will have access to a worldwide market, with Blockchain trust and transaction verification. The WAX widget can be integrated into any website so buyers and sellers won’t have to navigate away to a centralized marketplace. This opens up an opportunity for a wide array of websites to reap the benefits of an already exciting market. This means that users are brought out of silos and become free to reap the benefits of a global market.

What really sets WAX apart from other tokens is practically guaranteed large-scale adoption. Not only will WAX leverage the existing OPSkins user base, but they also announced their partnership with payment giant Xsolla, who will accept WAX as a form of payment. Xsolla is a global distributor and publisher of video games, providing clients including Twitch, Steam and Ubisoft advanced technical tools to optimize user acquisition and monetization efforts. By accepting WAX, Xsolla will help further advance cryptocurrency adoption by the 400+ mln strong gaming community.

The demand for WAX Token is apparent: the project has already raised over 139,000 ETH in its public Pre-Sale and Gamer Exclusive sale. Pantera Capital, HyperChain Capital, Galaxy Investment Partners, Fenbushi Capital, Kinetic Capital and Kyber Network, to name but a few, have all expressed interest in this project. Industry thought leaders, such as Ethereum Co-Founder Anthony Di Iorio and legendary game developers Dave Anthony and Brian Fargo are active supporters of this project.

The WAX Token Main Sale is opening today.

Bitcoin (BTC) SegWit Report by Digital Asset Research

XMule4xU_400x400.jpg

This article was originally published as a pdf on November 9th, 2017, and we wanted to bring it to the attention of our readers, investors, and all other cryptophites! ...

Bitcoin Is Dead! Long Live Bitcoin!

• It appears that the contentious SegWit2x hard fork scheduled for November 16th is now off. Leaders of the SegWit2x implementation and signers of the New York Agreement (NYA) backed down from the proposed implementation.

• This avoids a dangerous network split, which would have likely caused long and erratic block creation times, high transaction fees, and slow transaction confirmation times.

• The current network still has the original SegWit implementation, activated this past August, which has increased transaction throughput.

• Our calculations show that SegWit can scale the network to a theoretical maximum of 20.3 tps, but a more realistic maximum throughput is 11.7 tps.

• Vertical scaling solutions, such as SegWit and even the failed SegWit2x, still leave Bitcoin orders of magnitude behind the scale of centralized networks such as PayPal and Visa.

• Horizontal scaling solutions, such as the proposed Lightning Network, will need to be created if centralized networks are to be threatened.

Overview

On November 16, Bitcoin was scheduled to be forked into two separate blockchains, creating two different cryptocurrencies, BTC and B2X. This split stems from a long-standing disagreement between key stakeholders, such as developers, miners, and client software providers, with regards to how to scale the Bitcoin Network to increase the number of transactions it could handle. The proposed fork is now officially dead, according to prominent supporters of the project. We think this resolution is healthy for the ecosystem overall as it avoids potentially erratic block creation times, high transaction fees, and slow and unpredictable transaction confirmation times.

While we may not have 2MB blocks from SegWit2x, we still have the original SegWit, which continues to be adopted across the network. Because SegWit was activated through a soft fork, it is backwards compatible, and both legacy transactions and SegWit transactions can exist within the same block. SegWit has not been fully embraced by the community and its supporters still represent a minority. Bitcoin therefore has additional headroom to grow transaction throughput as measured by transactions per second (tps). Even if SegWit becomes fully adopted, the Bitcoin Network will still be orders of magnitude behind the transaction throughput of centralized systems, but it is a step in the right direction until horizontal scaling solutions, such as the Lightning Network are adopted.

Background

As Bitcoin gained traction over the years, the network could not handle the number of transactions demanded by users, resulting in lengthy delays that could only be bypassed by paying higher fees. This became evident beginning in 2015 and led to the Block Size Debate, an ongoing discussion about the trade-offs related to increasing Bitcoin’s block size for more transactions to be allocated in each block. Since mining Bitcoin is capital-intensive, miners want to maximize the number of transactions on a per block basis to increase the amount of transaction fees. The easiest way to achieve this is by increasing Bitcoin’s block size, which had been 1MB since Bitcoin’s inception. Although the core development team understood the need for faster transactions, it feared that merely increasing block size would affect the underlying safety of the protocol. Another recurring argument against the block size increase was the possibility of further mining centralization, which was already a concern of the community, whose general philosophy revolves around decentralization.

Bitcoin Core developers preferred a different solution that increased transaction speed without increasing block size. This came to be known as SegWit or Segregated Witness — a change in Bitcoin’s code that optimizes block size by removing unnecessary information from each block, leaving more space for transaction data and ultimately reducing confirmation times. The update was welcomed by most of the community, but several prominent figures of the Bitcoin mining industry characterized SegWit as being an inefficient solution.

In February 2016, a group of miners and developers met in Hong Kong and reached a compromise where both SegWit and a block increase to 2MB would be implemented. This became known as the Hong Kong Agreement. However, the developers present in Hong Kong did not represent the entire core development team. In response, the core developers released on October 27, 2016, a new version of Bitcoin Core that contained SegWit, which would only be adopted if 95% of miners signaled that they would adopt it, but was not compatible with 2MB blocks. By May 2017, less than 30% of miners signaled their intention to adopt SegWit as many of them felt betrayed following the Hong Kong Agreement.

In May, Consensus, a major blockchain conference held in New York, was held by CoinDesk, a subsidiary of the Digital Currency Group. Until now, Bitcoin-related businesses had largely stayed out of the Block Size Debate, hoping that the miners and core developers could reach some resolution as they cared most that any safe scaling solution was implemented. It was clear that consensus was unlikely to be reached, but at Consensus, the Digital Currency Group brokered a deal where 58 Bitcoin-related companies and 83% of the hashing power of the Bitcoin Network supported the activation of SegWit at an 80% threshold and a 2MB block increase with a hard fork within six months. This became known as the New York Agreement. Although core developers were invited to this meeting, none attended, and the core developers decried the New York Agreement as “back room deal-making.” This led to Bitcoin Improvement Proposal 148 (BIP 148), which proposed a user activated soft fork (UASF) whereby any nodes running BIP 148 would reject any Bitcoin blocks that did not signal support for SegWit. The core developers implemented this mechanism in case a large percentage of Bitcoin miners refused to adopt SegWit and started mining on a new chain, thereby mitigating potential transaction delays.

Recognizing that the core developers did not support the New York Agreement and that between the activation of SegWit and the block size increase the core developers had their preferred SegWit solution that the miners would not otherwise allow, many in the Bitcoin Community Copyright© 2017 – DIGITAL ASSET RESEARCH 4 refused to support BIP 148 or the New York Agreement from the outset. In April, mining hardware manufacturer Bitmain was the first to suggest a hard fork and the idea for Bitcoin Cash began getting support. In the following month, the Bitcoin ABC Project (Adjustable Block Cap) announced it was developing a full node implementation of the Bitcoin protocol that is compatible with Bitcoin Cash. The project’s goal was to support a version of Bitcoin that rejected SegWit and increased the block limit to 8MB. The fork happened on August 1, and the first Bitcoin Cash block was mined 6 hours after Bitcoin Block 478558 by ViaBCT, a Chinese digital token exchange and mining pool.

Following the Bitcoin Cash hard fork, the concerns about the delay between the activation of SegWit and the block size increase came to fruition. People on both sides of the debate were maliciously attacked online and some signatories to the New York Agreement who supported SegWit but not the block size increase withdrew their support of the agreement. Although SegWit2x was scheduled to be activated at Bitcoin Block 494784 on November 16, on November 8, it was announced that the project had been suspended. In an email from Mike Belshe (CEO of BitGo), he, on behalf of Wences Casares (Xapo), Jihan Wu (Bitmain), Jeff Garzik (Bloq), Peter Smith (Blockchain.com) and Erik Voorhees (Shapeshift.io) announced that “we have not built sufficient consensus for a clean block size upgrade at this time. Continuing the current path could divide the community and be a setback to Bitcoin’s growth. This was never the goal of SegWit2x.”

Scaling Crypto Scaling open, decentralized networks such as Bitcoin is probably the first, second, and third most talked about issue in the industry. The heart of the discussion centers on how to increase transaction throughput from a pedestrian 4 tps for Bitcoin, to the levels of permissioned, centralized networks such as PayPal and Visa. This is an issue for other cryptocurrencies, like Ethereum, which although confirms transactions more quickly than Bitcoin (1.5 minutes vs 60 Copyright© 2017 – DIGITAL ASSET RESEARCH 5 minutes), still tops out at a theoretical maximum of ~23 tps. For comparison, PayPal handles nearly 200 tps and Visa regularly handles nearly 2,000 tps.

The heart of the debate for decentralized networks is the scalability trilemma, the balancing of the three vectors of a network: decentralization, security, and throughput. Said simply, a push in one direction of these vectors sacrifices one or more of the other vectors. For example, it is simple to have a high throughput system if you sacrifice decentralization. Most existing or implemented solutions for scaling blockchains have been vertical solutions, meaning that they aim to increase the number of transactions in each block. This is true of the initial implementation of SegWit, which made more room in each block for transactions by optimizing how data is stored. There are other, upcoming solutions that are classified as horizontal scaling solutions, such as state channels and blockchain sharding. State channels is a technology that involves opening direct off-chain payment paths between one or more parties. These promise instant transaction verifications and tps that can reach the millions. The Bitcoin and Litecoin Lightning Networks, as well at the Raiden Network on Ethereum, are examples of state channels. We will get a glimpse of Raiden’s potential when µRaiden launches on Ethereum’s main network, expected by the end of November. Database sharding is still a relatively new concept, but involves transaction verification by only a portion of the network, but still retains the security and transaction verifiability of full node validation. Ethereum’s Plasma proposal is an example of this technology. Developer Joseph Poon is a driving force behind Bitcoin’s Lightning Network, Ethereum’s Plasma proposal, and the ERC-20 token OmiseGO.

The implementation of SegWit was a step in the right direction for improving Bitcoin transaction scalability. Prior to the initial implementation of SegWit, the block size of Bitcoin had a hard cap of 1MB. After the implementation of SegWit, the notion of a 1MB fixed memory size was replaced by something called block weight. Block weight is a different accounting metric for block size where 1 byte of transaction data is counted as 4 bytes of block weight and the SegWit data (i.e. the scriptSig) is only counted as 1 byte of block weight. New blocks, which can have a mixture of both SegWit and non-SegWit transactions, have a maximum block weight of 4MB.

The Arguments Against Block Size Increases

Users that run full node Bitcoin clients are required to store a full copy of the blockchain and incur the storage costs of running the software. The current directory size of the Bitcoin blockchain is 160GB, which enables most personal computers to run the software. However, if blocks double in size, Bitcoin’s directory size will grow at a proportional rate, increasing users’ storage costs. Consequently, less users will be able to run full nodes thereby potentially increasing miner centralization, contradicting Bitcoin’s ethos of decentralization. Proponents of a block size increase often cite Moore’s Law to explain how users will be able to afford a larger directory size, but considering the growth rate seen in the 1MB legacy chain, there is an argument that a 2MB chain will outpace future reductions in storage costs.

While an increase in block size may temporarily relieve network transaction congestion, it is not a long-term solution and blocks will eventually fill in the future, assuming Bitcoin continues to grow and be adopted. There is also an argument that negative externalities resulting from a block size increase would disadvantage the network over the long term, as bigger blocks increase storage costs and make it costlier to operate full nodes. Larger blocks also require significant amounts of hashing power to be completed, which has also been a factor impacting centralization. Other negative externalities include an increase in the frequency of orphan blocks due to the broadcast latency of larger blocks.

Given these concerns, in 2015, Bitcoin’s core development team began researching scalability solutions that did not involve a block size increase. Since the assumption was that there will always be a constituency that denies changes that involve hard forking the protocol, research on these solutions focused on backwards compatible upgrades, or soft forks. Soft forks give users the option, but not the obligation, to adopt the proposed improvements and do not split the network when consensus cannot be reached. Many improvements can be implemented through soft forks. The Segregated Witness project was the first attempt to optimize the data structure of a transaction to increase the number of transactions that can be allocated into a block without increasing the block size.

Concluding Remarks

Even though the short-term threat of a contentious hard fork has been avoided for now, the Block Size Debate is far from over. In the email announcing the suspension of SegWit2x, it seemed clear that the project was being suspended, but not necessarily abandoned, due to a lack of consensus. According to the same email, the leaders of the project “believe it will eventually become obvious that on-chain capacity increases are necessary” and “when that happens, [they] hope the community will come together and find a solution, possibly with a block size increase.”

Forking Bitcoin has become to the fastest way to get a cryptocurrency listed on an exchange, and contentious forks such as Bitcoin Cash are likely to reoccur. We will continue our research on scalability solutions that, like SegWit, increase transaction throughput without sacrificing decentralization and security. For the past two years, vertical scalability solutions, such as block size increases, have been suggested by prominent members of the community, and most have failed. Our analyses indicate that vertical scalability solutions will not sufficiently scale tokenized networks, and such proposals will always carry a risk of dividing the ecosystem. For these networks to achieve sufficient throughput to compete with their centralized counterparts, there needs to be more focus on horizontal scalability solutions that benefit from parallel computation. SegWit lays the foundation for such solutions, and we will continue to closely monitor future developments.

Worldwide Asset eXchange Oversubscribed in $21 Million Invitation Only Private Pre-Sale for WAX Token

maxresdefault (25).jpg

[press release]

OPSkins Founders to Introduce 400 Million Gamers to Cryptocurrency

Menlo Park -- NOVEMBER TBD, 2017 -- Worldwide Asset eXchange (WAX), a decentralized platform allowing anyone to operate an in-game virtual marketplace, today announced it was oversubscribed in $21 million WAX Token invitation only private pre-sale. Participants included Pantera Capital, Alphabit Fund, HyperChain Capital, and Crypto Asset Management. The WAX Token public pre-sale is now open until November 15, 2017, at which time the General Audience Main Sale will commence.

Developed by the founders of OPSkins, the world’s leading marketplace for online video game assets, WAX is designed to serve the 400 million online players who already collect, buy and sell in-game items. With the inclusion of WAX’s simple exchange widget, gamers will have access to a worldwide market with blockchain trust and transaction verification.

“We saw an outstanding response from partners during our invitation only private pre-sale, and we’re now working closely with the OPSkins community to educate first-time cryptocurrency users on how to create wallets and participate,” William Quigley, CEO of WAX and CEO of OPSkins.

“Based on current contribution rates, we anticipate over 10,000 gamers will participate in the pre-sale through a gamer exclusive. This supports fundamental that WAX is the onramp for mass-market cryptocurrency adoption and we remain eager to share the benefits of blockchain with millions of gamers,” Malcolm CasSelle, President of WAX and CIO of OPSkins.

The virtual item trading industry is currently fragmented across hundreds of competing marketplaces, each utilizing different business practices tailored to their region. WAX’s solution is a global virtual item repository that provides a complete catalog of all items available. By leveraging blockchain technology, WAX unites gamers and marketplaces enabling instant

payments, security, and trust services. WAX Tokens allow gamers to quickly and easily harness the power of fully developed, highly complex virtual goods exchanges.

WAX industry advisors include ‘Call of Duty’ creator and developer Dave Anthony, Interplay Entertainment and inXile Entertainment Founder Brian Fargo, Ken Cron, former CEO of Vivendi Universal Games and Ethereum Co-Founder Anthony Di Iorio.

ABOUT WAX

WAX is a decentralized platform that enables anyone to operate a fully functioning virtual marketplace with zero investment in security, infrastructure, or payment processing. Developed by the founders of OPSkins, the world’s leading marketplace for online video game assets, WAX is designed to serve the 400+ million online players who already collect, buy, and sell. With the inclusion of WAX’s simple exchange widget, gamers will have access to a worldwide market with blockchain trust and transaction verification. For more information, please visit https://www.waxtoken.com/.

MEDIA CONTACT: Transform Group, wax@transform.pr

Bitcoin Doubters Not Stopping Managers from Taking Plunge

FundFire-logo-2c-FT-tag-hi.jpg

[originally published By Lydia Tomkiw October 4th, 2017 in FundFire, here. Paywall requires password. Features Crypto Asset Management's Managing Director, Tim Enneking.]

More hedge funds continue to launch or dip into the cryptocurrency sector, even as debate and skepticism is growing about its investment prospects, with big industry names staking out their views and new questions about regulatory issues surrounding the space.

Bridgewater Associates founder Ray Dalio described Bitcoin last month as a “highly speculative market” and a “bubble." JPMorgan Chase CEO Jamie Dimon called Bitcoin “a fraud” and compared it to a boom and bust that will be “worse than tulip bulbs.” And a common refrain from critics has been that cryptocurrencies offer a haven for illicit activities.

Others are signaling caution but not full reproach, such as Goldman Sachs CEO Lloyd Blankfein, who tweeted yesterday that he has not yet reached a conclusion regarding Bitcoin.

Yet more managers continue to launch cryptocurrency hedge funds, as reported. Former Fortress Investment Group macro manager Mike Novogratz is the latest example, setting a $500 million target for his new hedge fund, Galaxy Digital Assets Fund, including $150 million of his own money, as reported.

The hedge fund cryptocurrency landscape is a complicated and still emerging one, said Olaf Carlson-Wee, founder and CEO of Polychain Capital, a hedge fund with over $250 million in assets under management, speaking at the Seward & Kissel and Bloomberg BNA Private Funds Forum last week. “This space is very noisy and esoteric… For your average person it can often feel impenetrable,” he said.

But the tone of the wider debate strikes some as overheated. Dimon’s attacks are “ignorant,” says Timothy Enneking, managing director of Crypto Asset Management, a cryptocurrency trading fund with over $10 million in assets under management that launched in July and trades in 50 different types of currencies.

“He didn’t blindly attack everything in the cryptocurrency space,” Enneking says. “He didn’t attack blockchain or cryptocurrency in general. What he attacked was Bitcoin.”

Enneking himself was skeptical of the cryptocurrency space nearly five years ago, before studying the area and determining “there’s a niche that could be filled by crypto.” There are fair criticisms to be made of Bitcoin, including its stability, he says.

Enneking spends a lot of time explaining the space and advises, “You’re an idiot not to invest in the crypto space but you’re also an idiot to invest too much.”

To grow the market, cryptocurrency managers also should welcome more regulatory guidance, Carlson-Wee said. “When it’s a little unclear, it hurts the good actors more than the bad actors,” he said.

3 Things You Should Know Before Investing In Cryptocurrencies

U5dr7n3K5Pw1a1jzNzdMeyeHgPoMzer_1680x8400.jpg

The biggest fear facing investors is fear of loss. Stocks are richly valued, bonds are still offer terrible yields, and commodities are losing their unique movements as correlation to other assets increases over time.

Cryptocurrencies are being heralded as the solution to the retirement crisis facing the global 99%.

But are they? The market is still VERY small and volatile, and governments certainly don’t appreciate the competition to their fiat currencies.

In the case of cryptocurrencies, the biggest fear facing investors is STILL fear of loss: both fear of investing in something they don’t understand, putting a nest egg at risk, and fear of NOT investing in the crypto space and taking part in the life-changing gains digital assets have seen over the last couple years.

Facing a lack of information, many investors have chosen to stay on the sidelines. Therefore, the purpose of this post is to lift the veil of obfuscation surrounding the crypto space.

We asked our Managing Director, Tim Enneking, his thoughts on the crypto investing...

3 Things You Should Know Before Investing In Cryptocurrencies:

1. What is a cryptocurrency?

“Well, to start, alternative currencies are NOT a new idea, and parallel currencies have existed for millennia: Armies issued scrip throughout history, Sperry & Hutchinson distributed S&H Green Stamps from the 30’s to the 80’s, and Frequent Flyer Miles have been around for decades. Further, communities for years have tried with varying levels of success to launch their own local currencies. For example, following a 1974 coup, the Cypriots created their own currency, the Cypriot Pound, issued at a rate of USD $2 = 1 Cypriot Pound. And let’s not forget that the first real attempt at launching a crypto currency occurred in the Netherlands in the late 1980’s! Are cryptocurrencies cool? Yes. Are they revolutionary? No.”

2. How is a cryptocurrency different from a fiat currency?

“This is a great question, because less than 4% of the USD, and most other currencies for that matter, are actually represented by physical money. Sadly, in this day and age, fiat currencies aren’t backed by ANY assets. In the case of crypto, or purely electronic, currencies, we’re talking about currencies not issued or regulated by a central authority. The peer-to-peer nature of cryptocurrencies is an essential differentiator from fiat.”

3. How do cryptocurrencies work?

“Cryptocurrencies represent a TRUE 24/7/365 market where viability and price are determined purely by supply and demand, rather than government manipulation. Occurring on open and public ledgers called Blockchains, Crypto transactions avoid third-party intermediation creating a nearly-instantaneous, low-cost, global payment infrastructure.”

Thanks for reading!

Look forward to our next posts as we dig for more answers to the above questions. Can’t wait ‘til then? See our proprietary and first-of-its-kind Cryptocurrency Index here: CAM Crypto30 Index

"Bitcoin Millionaires": Who are they?

Gavin Andersen

BTCGavin.jpg

Although Satoshi Nakamoto is often credited as the main developer of Bitcoin, Gavin Andersen made it what it is today. Andersen has been rumored to be Satoshi himself, a claim which he denies. Instead, he states that he was closely corresponded with the developer for many years. He was chosen as Nakamoto’s “successor” of sorts in 2010 and maintains the source code of Bitcoin to this day.

As time passes, Gavin Andersen speculates that Bitcoin will require less maintenance and that Bitcoin’s value will continually rise.

Yifu Guo

Yifu-Guo-Bitcoins.png

In order for Bitcoin transactions to be processed and added to the transaction record (known the blockchain), they must be solved with computing power. Since Bitcoin is peer-to-peer, users are responsible for mining. They are rewarded with Bitcoins for mining. Users previously used their GPU’s computing power to add to the blockchain, until NYU student Yifu Guo engineered the first purpose built Bitcoin miner.

Yifu Guo founded Avalon in 2012. The company’s miners became so popular they were sold out as soon as they were produced. Miners retailing for several hundred dollars were selling for many times more. Guo left the Avalon project after a year. Several other companies began selling bitcoin miners after Avalon, but Guo was the first to become a Bitcoin millionaire selling such miners.

Winklevoss Twins

103730610-3ED3-ESB-Winklevoss-0621.1910x1000.jpg

Tyler and Cameron Winklevoss rose to prominence after their legal battle with Facebook founder Mark Zuckerberg. The pair have launched numerous successful business ventures, and their investments in Bitcoin alone have earned them 11 million. The twin’s combined net worth is 400 million.

The Winklevoss twins have funded several Bitcoin related ventures. They invested $1.5 million in fellow Bitcoin entrepreneur Charlie Shrem’s company BitInstant in 2013. In 2014, they created the Winkdex, a financial index that tracks the average price of Bitcoin. The Winklevoss twins even created their own Bitcoin exchange, Gemini in 2015.

Tony Gallippi

Topy-Gallippi-Bitcoins.png

Entrepreneur Tony Gallippi was one of the first people to found a Bitcoin payment processor. The company, Bitpay, is one of the most popular of its kind. It processes one million dollars worth of payments every day, and was also one of the first companies to have agreements with major retailers.

Prolific investors and business tycoons such as Richard Branson, Jerry Yang, and Li Ka-Shing have invested in Bitcoin.

Jered Kenna

jared-kenna-interview.jpg

Former United States Marine Jered Kenna got his start when Bitcoins were only 20 cents per coin. Intrigued, he invested a large amount of money in the currency, which paid off after several years. His first Investment venture provided him with enough funds to launch several business ventures. His first company was Tradehill, a Bitcoin dark (anonymous) mining pool, making Kenna was the first to pioneer dark mining pools.

Kenna now runs a craft brewery in Colombia (the brewery accepts Bitcoins of course). He has also opened 20mission in San Francisco, a collaborative workspace for startups and entrepreneurs.

Dave Carlson

040414TB_BitcoinMine.jpg

With enough hardware, Bitcoin mining can be an extremely profitable venture. Dave Carlson is likely the first Bitcoin millionaire to have mined their way to riches. After founding company MegaBigPower from his basement, he began to mine on an industrial scale. Carlson reported that he made over 8 million per month in 2016 from his 2,000 square foot warehouse.

Charlie Shrem

1200px-Charlie_Shrem_2013.jpg

Charlie Shrem is possibly the most influential Bitcoin millionaire. He went all-in on Bitcoin when it was trading cheaply, and at only 22 years old founded BitInstant. The company was extremely successful at first. But in December 2014, Shrem was accused and found guilty of laundering money to infamous deep web black market The Silk Road. Shrem states he did not knowingly handle any money for illicit purposes.

After his release from prison in 2016, Shrem got right back to business and launched Intellisys Capital. The firm sells investment portfolios in blockchain companies. Charlie Shrem is close friends with fellow bitcoin innovator and investor Roger Ver.

Roger Ver

roger-ver-headshot.jpg

Some people love Bitcoin so much they can’t help but spread the joy. Bitcoin millionaire Roger Ver has generously shared his wealth to spread the word of Bitcoin. For his outspoken advocacy and generosity, Roger Ver was given the moniker “Bitcoin Jesus”. Roger Ver’s passion for Bitcoin stems from his desire for it to rival fiat currencies. His first investment was in his friend Charlie Shrem’s company BitInstant.

Roger Ver is the first Bitcoin startup investor. Although Ver was already a successful entrepreneur before getting into Bitcoin, doing so greatly multiplied his riches. He has also donated millions to charity.

Ross Ulbricht / The FBI 

Screen-Shot-2014-09-05-at-5.40.24-PM.jpg

Bitcoin has undeniable potential to change the world. However, Bitcoin also has a sinister side. Its anonymous nature makes transactions nearly impossible track. Numerous black markets have appeared on the deep web selling drugs, contraband, and illegal services. The first of these markets was the Silk Road, created by Dread Pirate Roberts (Ross Ulbricht). Even before bitcoin was worth $1000, Dread Pirate Roberts was a Bitcoin millionaire several times over.

In September 2013, the FBI tracked Dread Pirate Roberts down. Their investigation led to American Ross Ulbricht, who was sentenced to life in prison for money laundering, hacking, and conspiracy to traffic narcotics. The FBI shut down The Silk Road, and seized over 144,000 Bitcoins then being held as escrow. As a result, the largest Bitcoin wallet in the world now belongs to the FBI.

bitcoin (2).jpg

Satoshi Nakamoto

Becoming a Bitcoin millionaire is possible, but what does it take to become a bitcoin billionaire? Doing so would be incredibly difficult unless one was involved from the beginning – or if they created the currency themselves.

The name Satoshi Nakamoto is likely not the real name of Bitcoin’s creator, simply a pseudonym. Numerous attempts have been made to uncover the enigmatic creator of Bitcoin’s true identity, to no avail. Few records of Nakamoto exist other than e-mail correspondence records between him and Bitcoin developers. What is known about him however, is that he currently holds 1.1 million Bitcoins... do the math.

guy-fawkes-mask.jpg

Finding information on Bitcoin millionaires can be difficult, though. Sometimes they don't want to be found, preferring to remain anonymous... and Bitcoin is cool with that. Listed below, instead of more Winklevoss', is a list of the Top 50 Richest Bitcoin Addresses, last updated at block 482558. Enjoy!

  1. 3D2oetdNuZUqQHPJmcMDDHYoqkyNVsFk9r 117,014 BTC
  2. 3Nxwenay9Z8Lc9JBiywExpnEFiLp6Afp8v 93,843 BTC
  3. 16rCmCmbuWDhPjWTrpQGaU3EPdZF7MTdUk 86,203 BTC
  4. 1FeexV6bAHb8ybZjqQMjJrcCrHGW9sb6uF 79,957 BTC
  5. 1HQ3Go3ggs8pFnXuHVHRytPCq5fGG8Hbhx 69,370 BTC
  6. 1PnMfRF2enSZnR6JSexxBHuQnxG8Vo5FVK 66,452 BTC
  7. 1AhTjUMztCihiTyA4K6E3QEpobjWLwKhkR 66,378 BTC
  8. 1DiHDQMPFu4p84rkLn6Majj2LCZZZRQUaa 66,235 BTC
  9. 1EBHA1ckUWzNKN7BMfDwGTx6GKEbADUozX 66,233 BTC
  10. 18rnfoQgGo1HqvVQaAN4QnxjYE7Sez9eca 59,000 BTC
  11. 1LdRcdxfbSnmCYYNdeYpUnztiYzVfBEQeC 53,880 BTC
  12. 1JCe8z4jJVNXSjohjM4i9Hh813dLCNx2Sy 53,000 BTC
  13. 1EfBMK9q6rGFZazeF7jyNdTgqGYgcDgRE5 48,260 BTC
  14. 16cou7Ht6WjTzuFyDBnht9hmvXytg6XdVT 44,998 BTC
  15. 1MuYkciQTfRsU94ReAe5MiAfUpCrbLBcFR 44,864 BTC
  16. 15CVfJUC1LKn1GKZx6RM5UMbFfnTd8vTT4 44,009 BTC
  17. 336xGpGweq1wtY4kRTuA4w6d7yDkBU9czU 42,603 BTC
  18. 1PzGnXGvoGGtCcGpqzkJHebZVgM48VL2x4 40,000 BTC
  19. 323ENWgPNZdzsm2d6CzEaPTFrvavn1giv5 36,558 BTC
  20. 17hf5H8D6Yc4B7zHEg3orAtKn7Jhme7Adx 36,000 BTC
  21. 3CqBquEFMYY548fNBz8u2MBw3HKprS3Xft 35,293 BTC
  22. 19Rd2Z4ckdPEs34KEmKpbddpK7ngp1sR6g 35,228 BTC
  23. 3Kzh9qAqVWQhEsfQz7zEQL1EuSx5tyNLNS 34,097 BTC
  24. 33VMRgxXZWgZGmGnGRZ9AEW8bZs8scMiY1 33,809 BTC
  25. 37x6JnDNhbsBw95bvEreB7WHWA74gGR17y 33,635 BTC
  26. 3Ap6mixhHLmVtH41YHH94Ut4jBfmqRpzgQ 33,602 BTC
  27. 32GxivQN3VKtVEtgsH5uTWfXd5b2LkXyUZ 32,489 BTC
  28. 14eQD1QQb8QFVG8YFwGz7skyzsvBLWLwJS 32,071 BTC
  29. 12ib7dApVFvg82TXKycWBNpN8kFyiAN1dr 31,000 BTC
  30. 1FrKNGFCqZAV3y3n9HSswoSDX8ExKb2paD 30,108 BTC
  31. 32ixB1aXiwgpHGHo27SMRSULajCdc7jq9Q 30,000 BTC
  32. 1GqaihzhS33G4kt7VKJ7UEL1ENaHazRS2k 29,772 BTC
  33. 33VukC9ReF5bkDvPNUTy5j6VEbzMc9JFt3 28,477 BTC
  34. 12tkqA9xSoowkzoERHMWNKsTey55YEBqkv 28,151 BTC
  35. 1N8emyFpMob6hDVhLiV1kTPiHBB8DQHWpp 26,343 BTC
  36. 198mmEcqMgmjmi4pXi48hRaZyK5GaPDmJt 26,215 BTC
  37. 3R1hBCHURkquAjFUv1eH5u2gXqooJkjg4B 25,899 BTC
  38. 1J7fmT3Wv62u4p6FuwbVJQXhQE3HiH4AQs 25,489 BTC
  39. 1G1AndHMczVQYLGfYJzqkDjXrFifpMsTaZ 25,408 BTC
  40. 1A4WLCaR11ARbib283pnH8jy8s4TJEjjPz 25,403 BTC
  41. 1JfoBz3smLAFxCMHXw155b4UE9FeYNBvCv 25,377 BTC
  42. 13cKZYW75zBPuW6xp8Pt5QTWFHQpXosP56 25,301 BTC
  43. 153yuheqMotbbAxxXc8Ztwx73oSMyAB1wq 25,272 BTC
  44. 36png4nUpGkCrYnRXNR4PMSRFEgGadmh8S 24,998 BTC
  45. 3J5KeQSVBUEs3v2vEEkZDBtPLWqLTuZPuD 24,655 BTC
  46. 3HZUwxZbYRef9oEuvSvjgVMyZ227Hur7ng 24,000 BTC
  47. 19tB13y9eDCD238rxCMNs3dKQ8RA9EVgop 23,999 BTC
  48. 1JTseLw3XXPYDEM2PDnYt1n3iMqNEpc8qd 23,362 BTC
  49. 13beT45wEmqWwcTnAPDsUrHqHDnwS1xrjf 23,278 BTC
  50. 3Cg3oypyypMBz1bY8kWyYifwXqnTj5iuCo 22,969 BTC

74 Great Quotes On Bitcoin, Cryptocurrencies and Cryptography: From Milton Friedman to William Shatner

shutterstock_141354994-650x360.jpg

Are you a lover as we are of all things crypto? Check out these quotes below! From Milton Friedman to William Shatner.

  1. “I think the internet is going to be one of the major forces for reducing the role of government. The one thing that’s missing but that will soon be developed, is a reliable e-cash.” - Professor Milton Friedman

  2. “But all those who used their knowledge in a bid to enact social change saw cryptography as a tool to enhance individual privacy and to shift power from big, central institutions to the human beings who live in their orbit.” - Paul Vigna

  3. “Stay away from it. It’s a mirage, basically” - Warren Buffet

  4. “If you care about liberty, the nonaggression principle, or economic freedom in general you should do everything you can to use Bitcoin as often as possible in your daily life.” - Roger Ver aka “Bitcoin Jesus” Voluntaryist

  5. “Bitcoin is evil.” - Paul Krugman

  6. “Bitcoin is a very exciting development, it might lead to a world currency. I think over the next decade it will grow to become one of the most important ways to pay for things and transfer assets.” - Kim Dotcom

  7. “Cryptography is typically bypassed, not penetrated.” - Adi Shamir

  8. “Bitcoin seems to be a very promising idea. I like the idea of basing security on the assumption that the CPU power of honest participants outweighs that of the attacker. It is a very modern notion that exploits the power of the long tail.” - Hal Finney

  9. “We don’t really know how this coin is created. You can’t have a functional money without a basic transparency. Unless you are addicted to volatile trading for the sake of trading, stay away from the Bitcoin. Thankfully its plunge will be a salutary caution to most folks.” - Steve Forbes

  10. “Bitcoin is the beginning of something great: a currency without a government, something necessary and imperative.” - Nassim Taleb

  11. “The crypto currency community hasn’t decided whether they want to be anarchist rebels or to replace the establishment.” -Adi Shamir

  12. “So my view’s quite clear. I believe cryptocurrencies, Bitcoin is the first example, I believe they’re going to change the world.” - Richard Brown

  13. “Bitcoin gives us, for the first time, a way for one Internet user to transfer a unique piece of digital property to another Internet user, such that the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer. The consequences of this breakthrough are hard to overstate.” - Marc Andreesen

  14. ”Virtual Currencies may hold long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system.” - Ben Bernanke

  15. “It's money 2.0, a huge huge huge deal.” - Chamath Palihapitiya

  16. “Bitcoin is just one example of something that uses a blockchain. Cryptocurrencies are just one example of decentralized technologies. And now that the Internet is big enough and diverse enough, I think we will see different flavors of decentralized technologies and blockchains. I think decentralized networks will be the next huge wave in technology. The blockchain allows our smart devices to speak to each other better and faster.” - Melanie Swan

  17. “Cryptography has generated number theory, algebraic geometry over finite fields, algebra, combinatorics and computers.” - Vladimir Arnold

  18. “If you guys want proof Bitcoin is real, send them to me, I’ll cash them out and feed homeless people.” - Jason King

  19. “Bitcoin promises to take at least some of that power away from governments and hand it to people. That alone augurs significant political, cultural, and economic clashes.” - Paul Vigna

  20. “Not afraid of heights - afraid of widths.” - Thomas St Germain

  21. “Cryptography is the essential building block of independence for organisations on the Internet, just like armies are the essential building blocks of states, because otherwise one state just takes over another.” - Julian Assange

  22. “Blockchain is the tech. Bitcoin is merely the first mainstream manifestation of its potential.” - Marc Kenigsberg

  23. “Bitcoin is unstoppable.” - Roger Ver aka “Bitcoin Jesus” Voluntaryist

  24. “The blockchain keeps everyone honest, and a whole layer of banking bureaucracy is removed, lowering costs.” - Paul Vigna

  25. “Bitcoin was created to serve a highly political intent, a free and uncensored network where all can participate with equal access.” - Amir Taaki

  26. “This may be the purest form of democracy the world has ever known, and I — for one — am thrilled to be here to watch it unfold.” - Paco Ahlgren

  27. “Bitcoin is the currency of resistance.” - Max Keiser

  28. “It was the amateurs of cryptology who created the species. The professionals, who almost certainly surpassed them in cryptanalytic expertise, concentrated on down-to-earth problems of the systems that were then in use but are now outdated. The amateurs, unfettered to those realities, soared into the empyrean of theory.” - David Kahn

  29. “I am very intrigued by Bitcoin. It has all the signs. Paradigm shift, hackers love it, yet it’s derided as a toy. Just like microcomputers.” - Paul Graham

  30. “With e-currency based on cryptographic proof, without the need to trust a third party middleman, money can be secure and transactions effortless.” - Satoshi Nakamoto

  31. “Bitcoin may be the TCP/IP of money.” - Paul Buchheit

  32. “Cryptographical solutions might with great propriety be introduced into academies as the means of giving tone to the most important of the powers of the mind.” - Edgar Allan Poe

  33. “Bitcoin, and the ideas behind it, will be a disruptor to the traditional notions of currency. In the end, currency will be better for it.” - Edmund C. Moy

  34. “Bitcoin is Money Over Internet Protocol.” -Tony Gallippi

  35. “One must acknowledge with cryptography no amount of violence will ever solve a math problem.” - Jacob Appelbaum

  36. “You can’t stop things like Bitcoin. It will be everywhere and the world will have to readjust. World governments will have to readjust” - John McAfee

  37. “There are 3 eras of currency: Commodity based, politically based, and now, math based.” - Chris Dixon

  38. “The governments of the world have spent hundreds and hundreds of trillions of dollars bailing out a decaying, dickensian, outmoded system called banking, when the solution to the future of finance is peer-to-peer. It’s going to be alternative currencies like Bitcoin and it’s not actually going to be a banking system as we had before 2008.” - Patrick Young

  39. “The relative success of the Bitcoin proves that money first and foremost depends on trust. Neither gold nor bonds are needed to back up a currency.” - Arnon Grunberg

  40. “Cryptocurrency Protocols Are Like Onions.” - Vitalik Buterin

  41. “Right now Bitcoin feels like the Internet before the browser.” - Wences Casares

  42. “A cryptanalyst is a person who doesn’t like being called a hacker.” - Josh Zepps

  43. “Every informed person needs to know about Bitcoin because it might be one of the world’s most important developments.” - Leon Luow

  44. “We have elected to put our money and faith in a mathematical framework that is free of politics and human error.” - Tyler Winklevoss

  45. “Bitcoin is a technological tour de force.” - Bill Gates

  46. “When cryptography is outlawed, bayl bhgynjf jvyy unir cevinpl.” - John Perry Barlow

  47. “The bitcoin world is this new ecosystem where it doesn’t cost that much to start a new Bitcoin company, it doesn’t cost much to start owning Bitcoin either, and it is a much more efficient way of moving money around the world.” - Tim Draper

  48. “Bitcoin is Cash with Wings” - Charlie Shrem

  49. “What can’t kill Bitcoin, makes it stronger.” - Mark Wittkowski

  50. “What affected me most profoundly was the realization that the sciences of cryptography and mathematics are very elegant, pure sciences. I found that the ends for which these pure sciences are used are less elegant.” - Jim Sanborn

  51. “The future of money is digital currency.” - Bill Gates

  52. “Cryptocurrency is such a powerful concept that it can almost overturn governments.” - Charles Lee

  53. “The reason we're all here is that the current financial system is outdated.” - Charlie Shrem

  54. “Bitcoin totally strips away the State’s control over money.” - Roger Ver aka “Bitcoin Jesus” Voluntaryist

  55. “There are two kinds of cryptography in this world: cryptography that will stop your kid sister from reading your files, and cryptography that will stop major governments from reading your files.” - Bruce Schneier

  56. “It’s gold for nerds.” - Stephen Colbert

  57. “Cryptography shifts the balance of power from those with a monopoly on violence to those who comprehend mathematics and security design.” - Jacob Appelbaum

  58. “Economists and journalists often get caught up in this question: Why does Bitcoin have value? And the answer is very easy. Because it is useful and scarce.” - Erik Voorhees

  59. “If you think cryptography is the answer to your problem, then you don't know what your problem is.” - Peter G. Neumann

  60. “Cryptography began in mathematics.” - James Sanborn

  61. “A cryptanalyst who cannot crack a monoalphabetic cipher is incompetent even if s/he knows quantum cryptography.” ‘insecure’ on ‘The Crypto Forum’ hosted by ZetaBoards

  62. “Gold is a great way to preserve wealth, but it is hard to move around. You do need some kind of alternative and Bitcoin fits the bill. I’m not surprised to see that happening.” - Jim Rickards

  63. “Bitcoin will do to banks what email did to the postal industry.” - Rick Falkvinge

  64. “Someday consumers and businesses won’t hold Bitcoins for their account but will unknowingly access the Bitcoin network whenever payments are made.” - Paul Vigna

  65. “I think the fact that within the Bitcoin universe an algorithm replaces the functions of the government is actually pretty cool. I am a big fan of Bitcoin.”- Al Gore

  66. “Lots of people working in cryptography have no deep concern with real application issues. They are trying to discover things clever enough to write papers about.” – Whitfield Diffie

  67. “At their core, cryptocurrencies are built around the principle of a universal, inviolable ledger, one that is made fully public and is constantly being verified by these high-powered computers, each essentially acting independently of the others.” - Paul Vigna

  68. “I do think Bitcoin is the first encrypted money that has the potential to do something like change the world.” - Peter Thiel

  69. “Bitcoin is a remarkable cryptographic achievement and the ability to create something that is not duplicable in the digital world has enormous value” - Eric Schmidt

  70. “If privacy is outlawed, only outlaws will have privacy.” – Phil Zimmermann

  71. “Bitcoin is the most important invention in the history of the world since the Internet.” - Roger Ver

  72. “The entire human populace is now taking charge of the means of production and changing the rules of the game. They’re making their own freaking currencies, for God’s sake!” - Paul Vigna

  73. “I understand the political ramifications of [cryptocurrencies] and I think that government should stay out of them and they should be perfectly legal.” - Ron Paul

  74. “So Bitcoin is cyber snob currency…” - William Shatner