Daily Archives: November 4, 2018

Hilarious Lemoncoin Video Reveals Bitter Truths About the Crypto Space

A hilarious new cryptocurrency themed video has surfaced on YouTube. It starts with a man walking through the desert and being lucky enough to stumble upon a lemonade stand. He says “Perfect, I am dying out here, how much?”, and the man running the Lemonade stand responds “1 dollar worth of Lemoncoin, which is approximately 1,000 Lemoncoins”.

The man pulls out a US dollar bill, and the Lemonade stand operator aggressively responds “Get that centralized currency out of my face, this is 2018, I only accept cryptocurrency here, preferably Lemoncoin.” The man responds “I do not have whatever a Lemoncoin is.” The Lemonade stand operator explains “Lemoncoin is my utility token, it does not have a lot of utility yet, but we are working on it. One day it might go to a dollar.”

Although this video is certainly comedy oriented, it speaks the truth. Many dApps on the Ethereum network and other blockchain platforms force users to buy the native token of the platform. This is done in order to increase demand for the token and raise its price, with the tradeoff being a worse user experience. Further, initial coin offerings (ICOs) often make false promises of a cryptocurrency’s future price in order to get people to buy.

Another important point is that, while blockchain technology is highly useful and futuristic, it is not healthy to integrate blockchain technology into everything. Many platforms integrate blockchain technology into goods or services and try to hype it up, even if there is no benefit of using blockchain technology for that good or service.

The man trying to buy Lemonade says “Cool. I do not have Lemoncoin.” The man running the Lemonade stand says “Fine, I also take Bitcoin or Dogecoin.” The man tries to trade his Shiba Inu for a glass of lemonade at this point, but is refuted since the man running the Lemonade stand says it costs at least 200 Doge. This Siba Inu is obviously the man’s beloved pet, but clearly, he is so thirsty, due to being in the middle of the desert, that he needs the lemonade more than his pet.

The man who is now frustrated and desperate says “Ok fine, how do I get Lemoncoin, why is this so difficult?” The man running the Lemonade stand says “Think about it, it is the future of business, a trustless system without third parties. So to get Lemoncoin, I just need you to create an account on this third party exchange.”

A sketchy man in expensive furs then walks up and asks for bank information, passport, social security number, and a selfie. The man trying to buy lemonade says “I thought you said this was a trustless system.” This is the reality in the cryptocurrency space, converting from fiat to cryptocurrency is essential to enter the space, but exchanges and companies usually collect a full spectrum of know your customer (KYC) information before selling cryptocurrency due to government regulations. This is in drastic contrast to Satoshi Nakamoto’s vision of an anonymous and trustless form of money.

The man surrenders to this breach of privacy since he is so desperate for a cool drink, but then is informed it will take 3-5 days to process his application. This means the man, who is desperate for a drink, will not be able to get any lemonade when he actually needs it, even though it is sitting right in front of him and he has the cash to pay for it. He says “This is ridiculous, you are telling me if anyone wants to buy lemonade they have to go through this process?” The lemonade stand operator responds “This is the future of business, I already got like a dozen customers” when in fact there is no one else around and this frustrated customer is the only one there at the time.

That last part of the video really solidifies the point the video is making. Even if someone has money and desperately wants to buy a good or service with cryptocurrency, they have to wait days to get their cryptocurrency when using an exchange, making the process much more difficult than using regular cash. Cryptocurrency is designed to be secure and instant, but many of the centralized exchanges that exist are defeating that purpose.

Overall, although this video is hilarious, within 2 minutes it brings forth some bitter truths about why blockchain platforms will have a hard time gaining mainstream adoption. Indeed, many Ethereum dApps that have received tens of millions of USD of investment have far less than 1,000 users and a constantly declining user base.

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College Student Faces $400K IRS Debt After Crypto Bull Run

A student took to Reddit recently asking for advice on how to handle an IRS tax debt of $400K after his crypto investments had bumped and dived.

The young Californian, preferring to remain anonymous, profited like many from investments made towards the end of 2017 when his $5K stake in altcoins brought him a massive return of $880K.

His laptop gamble with Coinbase certainly paid off, but then came the payback after his portfolio sunk to a $125k in the new year. “They really never do teach this stuff” he posted on Reddit when asked if he’d set something by for tax.

The student claimed he’d been trading crypto-to-crypto and that Coinbase didn’t, “ever cash out to fiat and transfer any USD into my bank accounts from these tradings.” Nonetheless, he appears to have convinced himself the IRS is coming calling after receiving a standard Coinbase 1099K form (https://i.imgur.com/1TZuh2B.jpg) warning him that the information regarding his transactions would be forwarded to the Inland Revenue.

It appears he received little sympathy from Reddit users from comments such as, get “a tax professional and stop wasting time trying to get free advice,” to, somewhat philosophical, advice from one user who suggested that his problem “not be a high point in your life, but you will get through it.”

More useful advice suggested that he stay clear of “questionable accounting methods” and get an accountant to work out a suitable tax repayment method -although re-payments to the IRS to the tune of $400k may just impact on his $12/h part-time-job whilst getting through college.

A recent Twitter poll which quizzed US cryptocurrency investors about their tax scenarios revealed that 9% of the 9,339 respondents claimed that they had “already filed and paid,” with 53% far more adventurous claiming, “they’ll never catch me.”

It looks like more clarification is needed regarding paying these kinds of taxes in the US. The IRS Advisory Committee has just requested help in dealing with cryptocurrency taxation in a bid to ease its current $25 billion tax liability. The request for more clarity has come after the IRS published its findings from a report which  highlights the current confusion surrounding how to address taxation on cryptocurrency assets in the United States

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Saudi University’s New Blockchain Lab To Examine Tokenized Services

New York-based blockchain tech company Blocktech is moving into academia, announcing a new partnership with a Saudi university.

Blockchain labs are becoming increasingly more prevalent in the industry for research, as a backbone to a sound strategy of strong blockchain development. Also, many academics with both a business and technology background based at American universities have been praising blockchain technology for its broad range of applications and future potential.

Blockchain labs seem to hold no boundaries at the moment with major educational institutions joining the space. The latest blockchain lab project in Taibah University in Madinah, Saudi Arabia will begin work on “bonding curves for tokenized services and curation markets for data integrity,” alongside Nick Spanos’ Zap Oracle Platform, under the direction of expert AI professional Professor Walaa Alharthi. Responding to the success of her recent trip to Blocktech in New York where she worked with Spanos, CEO and Founder of Blocktech and a known blockchain expert, she said:

“Mr. Spanos gave a keynote address at Taibah University earlier this year that opened our eyes to the immediate relevance and importance of blockchain. Our team was honored to be invited to New York to train with an original pioneer of this technology. We are excited to share what we learned with our students while using the vast applications of blockchain technologies to serve the entire region.”

The professor said that the lab will work alongside the University’s Faculties of Computer Science, Law and Business with a view to “catalyzing blockchain adoption in the Middle East.” The idea will be to eventually extend the use of blockchain solutions beyond key sectors such as finance, oil and gas, and supply chain management.”

Taibah University, founded in 2003, with an enrolment of 70,000 students across all different fields of study sees the inclusion of a blockchain lab in line with its aim of preparing its graduates for the needs of today’s market across a range of fields including emerging technologies.

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BitcoinNews.com Daily Podcast 3rd November 2018

Listen to the 3 November 2018 BitcoinNews.com Daily Podcast below.

On this edition of the BitcoinNews.com Daily Podcast, we discuss how Charlie Shrem is being sued by the Winklevoss Twins for 5,000 bitcoins, and how Coinsource has become the first Bitcoin ATM operator to receive the New York BitLicense. Hear about Coinbase listing Basic Attention Token (BAT). Learn about the EOS21 protocol for transferring tokens between the Ethereum and EOS blockchains.

Follow the Bitcoin News Daily Podcast on AnchoriTunesSpotifyGoogle PodcastsStitcherRadio PublicPocket CastsOvercastCastbox, and Breaker. We broadcast a new episode every day, covering the most important topics in the crypto, Bitcoin, and blockchain world!

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New Pan-African Framework Launched to Boost Crypto Trade Across Diaspora

This week saw the launch of the African Digital Asset Framework (ADAF), a pan-African organization aimed at promoting cryptocurrency-based trade across the continent and amongst the African diaspora.

The new body will support another important programme, the Single African Digital Market initiative, which also promotes the use of new technology in the digitized economy. The ADAF has some strong backing on the continent of Africa, backed by ambassadors of the African Union and its member states and the African Development Bank (AfDB).

With African countries accounting for only 11 percent of the continent’s collective gross domestic product, the initial move of the new body was to examine a research paper which outlines the significance of digital currencies such as Bitcoin becoming the backbone of a borderless digital economy across the continent and around the globe. Co-founder Felix Macharia said ADAF explains the framework’s raison d’etre:

“ADAF was formed by organizations in the digital asset space who looked to harmonize standards and regulation in the space… Digital assets know no borders. If Africa is to benefit from the full potential of distributed ledger technologies and even from agreements around free trade, we must start drafting standards, legislation and regulations that are in line with this new reality.”

The ADAF certainly doesn’t come from humble beginnings as it originated as an idea on Nelson Mandela International Day at the United Nations in July. The pan-African initiative now carries significant weight including amongst other heavyweights, the former president of Mauritius Dr. Ameenah Gurib-Fakim and Queen Diambi Kabatusuila Tshiyoyo Muata of DRC’s Kasai Kingdom.

The platform will display policy proposals for different commercial sectors, data on sustainable development objectives which will include input from community members. Also, there will be a multi-lingual interface for all contributors to put forward suggestions for changes to current self -regulation, and solutions to current problems in the African cryptocurrency space.

In an online statement the ADAF suggested:

“Digital assets create a secure way for people to trade, peer-to-peer, across borders, enabling people to securely access and transfer items like currency, identities, land titles and votes over the internet,” adding that the platform had been implemented for the purpose of “encouraging digital asset ownership and value exchange in digital economies between Africans and its diaspora.”

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Electric Bike Integrates Bitcoin Lightning Network

Matthias Steinig, a programmer who focuses on Bitcoin Lightning Network technology, has developed the Lightning Payable e-bike, which can perhaps be called the Lightning Bike. Users send micropayments via the Bitcoin Lightning Network to turn on the bike’s electric motor, with 1 minute costing 250 satoshis, which is USD 0.01-0.02 depending on market fluctuations.

This is made possible with a Raspberry Pi, a network card which provides an internet connection, and an e-paper display. Users select how many minutes they want the electric bike to drive for, and are presented with a QR code on the e-paper display. The e-paper display uses very little energy, which is important since any energy used is drained from the electric bike’s battery.

The user scans the QR code with the Lightning Mobile App, a Bitcoin wallet that is Lightning Network enabled, and sends the payment. The electric bike then starts driving and shuts off once the period of time that was paid for has expired. The user of the bike can keep peddling under their own power, which makes this bike a good option for someone who wants to work out, but then gets tired and can have the electric motor drive them home.

Micropayments for the Lightning Bike could be done with normal Bitcoin payments, but since Bitcoin transaction fees are around USD 0.10 on good days, and can sometimes approach USD 1, it would be nonsensical. Users can send micropayments via the Lightning Network with transaction fees of practically zero, so users can buy a minute of riding time on the Lightning Bike without burning up far more Bitcoin in transaction fees.

Steinig has made the code for this project open source on GitHub, allowing anyone in the world to use this technology. Perhaps, bike rental companies will start using Lightning Bikes. Beyond that, with simple modifications, this code can be used to sell any goods or service with the Bitcoin Lightning Network. Vending machines and laundromats could perhaps use this technology in the future to facilitate instant and secure micropayments, ending the problem of needing to find quarters to do laundry.

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Coinbase Listings Continue to Accelerate, Basic Attention Token (BAT) About to Go Live

Coinbase, the largest cryptocurrency exchange headquartered in the United States with a valuation of USD 8 billion, continues to list new cryptocurrencies at an increasing pace. Deposits for Basic Attention Token (BAT) began on 2 November 2018 on Coinbase Pro, and once sufficient liquidity is achieved trading will go live. In general, once a cryptocurrency is listed on Coinbase Pro it soon becomes available on regular Coinbase, since Coinbase and Coinbase Pro have the same cryptocurrencies listed.

BAT is the official cryptocurrency of the blockchain-based Brave browser and is used to fuel a built-in advertising platform. Advertisers on the Brave browser give publishers BAT based on the performance of ads, and users receive a share of BAT too. Users can then choose to donate BAT to publishers or use the tokens to buy things on the Brave browser. The Brave advertising platform is designed to be transparent, reduce fraud, and cut out the middle-men.

Previously, only 5 cryptocurrencies were available on Coinbase: Bitcoin, Litecoin, Ethereum, Bitcoin Cash, and Ethereum Classic. Coinbase is the most prominent exchange in the United States, and there is a thirst among Coinbase traders and investors for more options. This caused Coinbase to launch a new listing process, with the goal of adding all legal and popular cryptocurrencies.

In the past month, Coinbase has listed the popular Ethereum ERC-20 token 0x, as well as USD Coin, which is an ERC-20 stablecoin that is managed by Circle and Coinbase. All ERC-20 tokens use the same backbone wallet technology, so it is straightforward for Coinbase to add any other ERC-20 tokens. Therefore, it is no surprise that Coinbase is adding the BAT, a popular ERC-20 token. BAT has a market cap near USD 300 million, placing it at #30 on CoinMarketCap.

Whenever a cryptocurrency is added to Coinbase it experiences a rally in price, and this is called the Coinbase Effect. BAT has already rallied 15% since the Coinbase listing was announced, and it is likely this rally will accelerate once trading goes live. Generally, the Coinbase Effect is sustained long-term, unlike the Binance Bump which is a short term pump and dump on average.

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Google CEO’s 11-Year-Old Mines Ether at Home

It seems like Google’s boss has a son with secret designs on the crypto world after telling his dad that he was mining Ether at home.

It appears that Google’s CEO Sundar Pichai’s 11-year-old son has his father’s entrepreneurial gene. Speaking at the New York Times DealBook conference last week he let slip that his son used the family computer to mine crypto. He commented:

“Last week I was at dinner with my son, and I was talking about something about Bitcoin, and my son clarified what I was talking about was Ethereum, which is slightly different,” Pichai said. “He’s 11 years old. And he told me he’s mining it.”

It seems that Google top brass have the mining bug after company co-founder Sergey Brin’s admission earlier this year that he was also mining Ethereum with his son at home. It seems that the kids are pretty up to date on the latest cryptocurrency tech details too, as Pichai admitted he had been corrected by his son when they were chatting about Bitcoin recently. Brin revealed:

“A year or two ago, my son insisted that we needed to get a gaming PC…I told him, ‘OK, if we get a gaming PC, we have to mine cryptocurrency.’ So we set up an Ethereum miner on there, and we’ve made a few pennies, a few dollars since.”

The Google boss was discussing his views on screen time for children in relation to a recent New York Times article about Silicon Valley technicians’ families and tech addiction among children. It appears that the computer his son was mining on was actually built by his dad.

“I’m like every other parent I guess,” Pichai said. “I do test a lot of gadgets at home, so I have vulnerabilities in terms of how my kids get access to stuff.”

Pichai said that he had to teach his son some important details about how the financial system worked, “I realized he understood Ethereum better than how paper money works …I had to talk to him about the banking system, the importance of it. It was a good conversation.”

The interview came on the same day that thousands of Google employees around the globe protested against Google’s handling of allegations of sexual misconduct against female employees with a simultaneous walk out. Pichai admitted ‘We didn’t always get it right.’

 

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