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Wednesday, November 15, 2017

Where did Bitcoin come from?

Where did Bitcoin come from?

Where did Bitcoin come from?

Bitcoin was ‘invented’ by a person or group of people using the name ‘Satoshi Nakamoto’. Does anyone know who this really is? Despite many articles and investigation to unmask the person(s), there is still no conclusive evidence of who they are. Does it matter? Not at all. Satoshi designed the entire Bitcoin system in an ‘open source’ manner - this means the code is available for everyone to inspect and see, so there are no hidden secrets, and no influence on it from the creator. Over time many others have also worked on this code so it’s already very different from the initial outline Satoshi proposed.
It’s also worth mentioning that there is a common misconception that Satoshi invented Bitcoin all by himself. Like many big breakthroughs in the sciences, Satoshi’s invention was built on the shoulders of giants. For the past few decades many top scientists, engineers and mathematicians were involved in research around cryptography, systems and so on. Satoshi managed to pull all of this work together into one coherent plan and then helped to start implement it. If you read the Satoshi whitepaper you’ll even notice that he references all the other work on which he relied to complete his invention.

Bitcoin was invented by Satoshi, standing on the shoulders of giants.


What is Ethereum?

What is Ethereum?

In many ways, Ethereum is similar to Bitcoin. It’s a public, peer-to-peer network or blockchain with its own digital currency called Ether. Ethereum was created by Vitalik Buterin in 2014 and the purpose of Ethereum is to be a platform on which smart contracts can be built and run.
Put very simply, Ethereum is intended to be a world computer.
Where Bitcoin stores a list of balances and transactions on its blockchain, the Ethereum blockchain is designed to store different types of data. This data can be accessed and used by computer programs running on the Ethereum blockchain. These programs are called decentralized apps, or dapps.
Developers around the world can build and run decentralized applications on the Ethereum blockchain. The purpose of these is to improve the industries of finance, personal information storage, governance and more by using the transparent nature of a blockchain.
Ethereum is intended to be a world computer.

Digital currency exchange

From Wikipedia, the free encyclopedia
Digital currency exchanges (DCEs) or bitcoin exchanges are businesses that allow customers to trade digital currencies for other assets, such as conventional fiat money, or different digital currencies.[1] They can be market makers that typically take the bid/ask spreads as transaction commissions for their services or simply charge fees as a matching platform.[1]
DCEs may be brick-and-mortar businesses, exchanging traditional payment methods and digital currencies, or strictly online businesses, exchanging electronically transferred money and digital currencies.[2] Most digital currency exchanges operate outside of Western countries,[3] avoiding regulatory oversight and complicating prosecutions, but DCEs often handle Western fiat currencies, sometimes maintaining bank accounts in several countries to facilitate deposits in various national currencies.[4][5] They may accept credit card payments, wire transfers, postal money orders, cryptocurrency or other forms of payment in exchange for digital currencies. They can send cryptocurrency to your personal cryptocurrency wallet. Many can convert digital currency balances into anonymous prepaid cards which can be used to withdraw funds from ATMs worldwide.[4][5]
Some digital currencies are backed by real-world commodities such as gold.[6]
Creators of digital currencies are often independent of the DCEs that trade the currency.[5] In one type of system, digital currency providers, or DCPs, are businesses that keep and administer accounts for their customers, but generally do not issue digital currency to those customers directly.[2][7] Customers buy or sell digital currency from DCEs, who transfer the digital currency into or out of the customer's DCP account.[7] Some DCEs are subsidiaries of DCP, but many are legally independent businesses.[2] The denomination of funds kept in DCP accounts may be of a real or fictitious currency.[7]

Contents

Regulatory issues

In 2004 three Australian–based digital currency exchange businesses voluntarily shut down following an investigation by the Australian Securities and Investments Commission (ASIC). The ASIC viewed the services offered as legally requiring an Australian Financial Services License, which the companies lacked.[8]
In 2006, US-based digital currency exchange business GoldAge Inc., a New York state business, was shut down by the US Secret Service after operating since 2002.[9] Business operators Arthur Budovsky and Vladimir Kats were indicted "on charges of operating an illegal digital currency exchange and money transmittal business" from their apartments, transmitting more than $30 million to digital currency accounts.[7] Customers provided limited identity documentation, and could transfer funds to anyone worldwide, with fees sometimes exceeding $100,000.[7] Budovsky and Kats were sentenced in 2007 to five years in prison "for engaging in the business of transmitting money without a license, a felony violation of state banking law", ultimately receiving sentences of five years probation.[10]
In April 2007, the US government ordered E-gold administration to lock/block approximately 58 E-Gold accounts owned and used by The Bullion Exchange, AnyGoldNow, IceGold, GitGold, The Denver Gold Exchange, GoldPouch Express, 1MDC (a Digital Gold Currency, based on e-gold) and others, forcing G&SR (owner of OmniPay) to liquidate the seized assets.[11] A few weeks later, E-Gold faced four indictments. Here is the DoJ release [12] and here is the rebuttal by Douglas Jackson, CEO.[13]
In July 2008, Webmoney changed its rules, affecting many exchanges. Since that time it became prohibited[by whom?] to exchange Webmoney to most popular e-currencies like E-gold, Liberty Reserve and others.[14]
Also in July 2008 E-gold's three directors accepted a bargain with the prosecutors and plead guilty to one count of "conspiracy to engage in money laundering" and one count of the "operation of an unlicensed money transmitting business".[15] E-gold ceased operations in 2009.
In 2013, Jean-Loup Richet, a research fellow at ESSEC ISIS, surveyed new money laundering techniques that cybercriminals were using in a report written for the United Nations Office on Drugs and Crime.[16] A common approach to cyber money laundering was to use a digital currency exchanger service which converted dollars into Liberty Reserve and could be sent and received anonymously. The receiver could convert the Liberty Reserve currency back into cash for a small fee. In May 2013, digital currency exchanger Liberty Reserve was shut down after the alleged founder, Arthur Budovsky Belanchuk, and four others were arrested in Costa Rica, Spain, and New York "under charges for conspiracy to commit money laundering and conspiracy and operation of an unlicensed money transmitting business."[17] Budovsky, a former U.S. citizen and naturalized Costa Rican, was convicted in connection with the 2006 Gold Age raid.[10][18] A U.S. indictment said the case "is believed to be the largest international money laundering prosecution in history."[18] More than $40 million in assets were placed under restraint pending forfeiture, and more than 30 Liberty Reserve exchanger domain names were seized.[17][19] The company was estimated to have laundered $6 billion in criminal proceeds.[17]

List of some notable digital currency exchanges

Title Country Fiat money Bitcoin Altcoins Commodity Trade Fee Decentralized
Btc.sx  UK No Yes No No 0.5% No
CEX.IO  UK Yes Yes Yes Yes 0% - 0.2% No
BTCChina  China Yes Yes Yes No 0% No
bx.in.th  Thailand Yes Yes Yes No 0.25% No
Coincheck  Japan Yes Yes Yes No -0.05% - 0.15% No
Coinfloor  UK Yes Yes No No 0.08 - 0.55% No
Coinbase  USA Yes Yes Yes No 1% No
Gatecoin  Hong Kong Yes Yes Yes Yes 0.02 - 0.35% No
GDAX  US Yes Yes Yes No 0.1% to 0.25%[20] No
Gemini  US Yes Yes No No -0.15% (rebate) to 0.25%[21] No
Kraken  United States Yes Yes Yes No 0.05 - 0.50% No
LocalBitcoins  Finland Yes Yes No No 1% Yes
Luno  South Africa Yes Yes No No 0% - 1% No
ANX  Hong Kong Yes Yes Yes No 0.3%-0.6% No

Over the counter trading (OTC)

Over-the-counter or off-the-exchange trading of bitcoins is a more flexible and convenient way of trading bitcoins comparing to traditional exchanges.
OTC trading has kept growing since 2014 in various financial markets as more institutions taking the trades off the exchange.[22] Today, many corporations or institutions employ individual traders or bitcoin-OTC trading desks to perform this task at moderate expenses.[23] Some representatives bitcoin-OTC trading desks could be Bitfinex.com, itBit, Coinfloor, Octagon Strategy Limited, LocalBitcoins, Bitstamp, BitX etc.

Quote

The quotes given by OTC trading desks are generally in line with the main bitcoin trading desks, such as coindesk, localbitcoins, bitstamp, btcxindia, zebpay.[24]

Preserve Market Stability[22]

Experienced OTC traders would fill large orders with multiple smaller orders outstanding in the public order book thus to avoid predatory pricing behaviours[25] in the bitcoin markets.

List of some notable bitcoin OTC desks


Title Country Fiat money Bitcoin Altcoins Trade fee Settlement Min. Limit (no. of btc)
Bitfinex.com[26]  Hong Kong Yes Yes Yes 0.1 - 0.2% NA NA
itBit[27]  Singapore Yes Yes No 0.1% per transaction T+0 100
Coinfloor[28]  UK Yes Yes No 0.1 - 0.38% T+0 NA
Octagon Strategy[29]  Hong Kong Yes Yes Yes[30] 0.1-0.5% T+0 NA
LocalBitcoins Worldwide Yes Yes No 0.0001 - 0.0010 BTC per outgoing transfer[31] NA NA
Bitstamp  UK Yes Yes No 0.1 - 0.35% NA NA
BitX[32] SingaporeYesYesNo0.1%NA250


Bitcoin Exchanges

Bitcoin

Places to buy bitcoin in exchange for other currencies.

Bitcoin Exchanges

Note: Exchanges provide highly varying degrees of safety, security, privacy, and control over your funds and information. Perform your own due diligence and choose a wallet where you will keep your bitcoin before selecting an exchange.

Costa Rican flagCosta Rica

BitMae

Colombia flagColombia

SurBTC

Indonesian flagIndonesia

Bitcoin Indonesia

Italian flagItaly

Postebit

Malaysian flagMalaysia

Luno

Mexican flagMexico

Volabit

Nepalese flagNepal

Bitsewa

New Zealand FlagNew Zealand

Kiwi-coin

Nigerian flagNigeria

Luno

Peruvian flagPeru

SurBTC

Polish flagPoland

BitBay

Singaporean flagSingapore

Luno

South African flagSouth Africa

iceCUBED
Luno

South Korean flagSouth Korea

Bithumb
Coinone
Korbit

Ukraine flagUkraine

Kuna

United Arab Emirates flagUnited Arab Emirates

BitOasis

United States flagUnited States

Gemini
itBit

Venezuelan flagVenezuela

Cryptobuyer


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