Blockchain Bites: Bitcoin’s Rich List, Coinbase’s Latest Acquisition
Ripple tried to settle with the SEC before the watchdog’s XRP-related lawsuit. The “bitcoin rich list” has more names than ever. Grayscale reports an uptick in interest from pension funds and Coinbase makes an acquisition to beef up its institutional bitcoin offerings. It has been a huge news day, so buckle up.
Ripple tried to settle charges of conducting $1.3 billion worth of unregistered securities transactions when selling XRP to exchanges and the public, before the U.S. Securities and Exchange Commission (SEC) sued in December, CEO Brad Garlinghouse said Wednesday. In a Twitter thread, Garlinghouse addressed what he described as five “key questions” about the SEC’s argument, though he warned that he was limited in what he could say because the case is ongoing. Several exchanges have moved to delist or stop XRP trading.
First acquisition of the year
Coinbase has acquired trade execution startup Routefire to bolster the exchange’s suite of institutional products ahead of a planned IPO. The terms of the deal were not disclosed, though Routefire was a small, seven-employee firm based in San Francisco. Coinbase has experienced intermittent outages during the run-up in bitcoin’s price above $40,000.
Cryptocurrency exchange Bakkt, which is majority-owned by Intercontinental Exchange, is in advanced talks to go public via a merger with a special purpose acquisition company (SPAC), Bloomberg reported, citing people with knowledge of the matter. The deal, if it’s concluded, would value the combined company at more than $2 billion, the report said. A deal could be announced as soon as next week.
What Joe Biden’s $3 trillion stimulus package means for bitcoin
President-elect Joe Biden is reportedly considering a two-pronged stimulus effort in the form of $2,000 checks for Americans and a tax and infrastructure spending package worth $3 trillion, the first sign of what many market analysts predict will be a tide of fiscal stimulus under a new U.S. presidential administration. With increased spending, comes increased inflation projections – which many crypto insiders see as a boon for bitcoin’s programmatic, deflationary attributes.
Yesterday, Facebook made the unprecedented decision to ban a sitting president, Donald Trump, from its services for his role in inciting the revolt that damaged the U.S. Capitol. Facebook and other social media firms have had four years to discuss how to balance publishing information in the public interest (because President Trump said it) when much of it is not factual.
Streaming service Twitch, e-commerce platform Shopify and others also banned the president, at least until he leaves office on Jan. 20. The president’s Twitter feed, meanwhile, was suspended for 12 hours, Jan. 6-7.
Many opponents have long called for Trump to be booted from his online bully pulpits, where he often commands a large audience (88.7 million people follow @realDonaldTrump, his personal Twitter account). Explaining the decision, Facebook CEO Mark Zuckerberg said the “current context is now fundamentally different, involving use of our platform to incite violent insurrection against a democratically elected government.”
Some in the crypto world see it differently.
“I think what is happening right now is absolutely ridiculous. One big circus show setting us up for the last act – total control of our thoughts and actions. Twitter and Facebook are mass scams. No matter what your political view, the amount of heavy-handed censorship is, let’s say, suspicious,” Josh Petty, founder and CEO of the alternative social media site Twetch, told Blockchain Bites over email.
It’s old hat to call crypto a libertarian insurrectionary movement, though there are some key areas where the two ideologies align – primarily in championing individualism and all the “classically liberal” rights associated with that. This means freedom of ownership, freedom of speech and freedom to “exit” from the crowd.
Instead of erecting laws to protect these freedoms, blockchains create cryptographic proofs to ensure certain conditions are always met. These are monetary assurances – like Bitcoin’s hard-capped supply, Ethereum’s infinite programmability or Solana’s blitzkrieg settlement speed – as well as cultural, like the idea that finance and speech should be uncensorable.
“People really value censorship resistance, both for themselves and others, to the degree where it can seem irrational to bystanders,” pseudonymous crypto researcher Hasu wrote in November, in a blog post titled, “Exploring Bitcoin’s core values and why we defend them.”
Blockchains, by connecting people directly, can assure certain freedoms that are often occluded when intermediaries get involved. If you believe that everyone has the right to a platform online, then you’d probably disagree with Facebook’s decision to ban Trump – regardless of the circumstances.
“Social media companies have no direct role in a democracy,” Petty said. “Social media companies, despite using the word ‘social’ to describe them, are private enterprises serving customers and their self-interests.”
Indeed, these bans could be seen as fatuous branding exercises. Trump has less than two weeks in office before a new president is sworn in, and many prominent figures in Congress and elsewhere are calling for his immediate removal.
While the hardline, anti-censorship approach has neat answers for complicated questions, in practice it often runs into just as many sticky situations.
Today, following news reports and a Southern Poverty Law Center (SPLC) investigation that found “white supremacists and neo-fascists” are using the streaming platform DLive, owned by Justin Sun’s Tron, the blockchain-based platform will take steps to suspend and ban streamers found in violation of its community rules.
“The DLive team actively are taking actions regarding streamers who are found to be part of or participants in the incident at the Capitol Building in Washington, D.C., on [Jan. 6] including but not limited to account suspension, removal of past broadcasts, freezing their earnings and abilities to cash out. The donation and paid subscriptions will be refunded to the accounts from which they originated,” a DLive press release reads.
Then again, DLive’s primary selling point was not censorship resistance but its rewards program.
New Bitcoin Quest Contest Gives People a Chance to Locate Crypto Seeds Hidden in Pictures
There’s an online-sleuthing contest starting on January 21st called “Bitcoin Quest,” where individuals can leverage their crypto-analytical skills to hunt for mnemonic bitcoin seed phrases hidden in artwork. Winners who drain the artwork’s crypto holdings will be able to win a Bitcoin Quest analyst certificate, 13 prizes worth $150 each, and three Satochip hardware wallets.
The teams behind the crypto industry organizations Hotmine, Its Business Baby, School Bitcoin, Satochip, and the Ed Khan Crypto Gallery have started a contest called Bitcoin Quest. The interesting event allows people to find bitcoin seeds hidden in unique artwork. People looking to join the online treasure hunt can check out the rules and guidelines here.
So far, there are two Telegram groups people can join the Bitcoin Quest hunt for mnemonic bitcoin seeds in both Russian and English languages. One of the organizers behind the Bitcoin Quest art contest told news.Bitcoin.com, the event will officially begin on January 21, 2021, and Telegram users should leverage the @helpmyquestbot to get a bunch of info regarding the quest.
“The crypto analyst contest where bitcoin is hidden in the art is an adventure journey,” the Bitcoin Quest announcement details. “Participants show their analytical skills by burning through the details of a large picture. The target for participants is to find the words and compile a bitcoin seed. It is 14 words in length and grants access to bitcoins kept on the winning addresses (13 of them + 3 Satochip ones) within Electrum Bitcoin Wallet (PC version),” the organizers add.
Contest winners will be able to attempt to win 13 bitcoin prizes in the artwork worth $150 each and three Satochip hardware wallets. The Satochip wallets will also feature a unique print from the 2021 Bitcoin Quest contest. Participants will also get a “Bitcoin Quest Analyst Certificate,” and with such a document, “nobody will dare to doubt your skills,” the contest creators emphasized.
Additionally, winners will be recorded in an immutable fashion and etched into a blockchain. “We will write a list of all winners into the Ethereum blockchain,” the Bitcoin Quest announcement notes. “It will be available via Eternal Note service msgeth.com, or via Etherscan.io. A transaction ID will be added to the individual certificate.”
The contest was created to get people to refine their knowledge about bitcoin and mnemonic seed phrases. Crypto skills are important and they will be needed, alongside hardware and software to participate in the latest quest. Users will need a Telegram account, knowledge about Electrum wallets, a computer, a large monitor, and more. Then in order to begin the quest hunting process, the user needs to obtain the picture from the Bitcoin Quest Telegram channels on January 21 and thereafter.
Simply find the seeds following the official quest rules and hints, and drain one or two of the winning seeds in the artwork. “You need to do all of the above faster than all the other crypto analysts,” the Bitcoin Quest creators told news.Bitcoin.com. Bitcoin Quest is a pet project from Jeff Fawkes aka ‘Bitpainter,’ an artist who has been creating art with bitcoin mnemonic seeds inside large drawings since 2017.
“I want to unite two of my great passions: art and crypto,” Fawkes said. “That’s where the idea of ‘Bitcoin Quest’ appeared. It’s a competition where I draw pictures with hidden bitcoin wallet seeds in them, and you keep whatever BTC you find,” the artist concluded.
What do you think about the Bitcoin Quest contest? Let us know what you think about this subject in the comments section below.
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Bitcoin rally may be the ‘mother of all bubbles’ says BofA
Bitcoin prices have doubled in less than a month to more than $40,000. And while cryptocurrency bulls argue this stunning surge is justified, some on Wall Street are warning that this won’t end well.
The recent rally may be another case of speculative mania. bitcoin looks like “the mother of all bubbles” according to Michael Hartnett, chief investment strategist at Bank of America Securities.
Hartnett points out in a recent report that the dramatic rise in bitcoin during the past two years — a surge of roughly 1,000% since the beginning of 2019 — is far greater than the gains for other assets that have enjoyed massive runups in the past few decades.
That includes a surge in gold prices of more than 400% in the late 1970s, as well as other notable investing manias: Japanese stocks in the late 1980s, Thailand’s stock market in the mid-1990s, dot-coms in the late 1990s and housing prices in the mid-2000s. Those sectors all enjoyed triple-digit percentage gains before crashing down to earth.
More recently, Chinese stocks, biotechs and the FAANGs of Big Tech have also posted gigantic gains.
Hartnett didn’t predict bitcoin prices will plunge per se. Instead, he cited the froth in cryptocurrency prices as yet another example of “increasingly speculative” investing behavior. He also warned of the increased interest in IPOs and SPACs for big unicorn startups.
Hartnett’s not the only one sounding bitcoin alarm bells. Given that the US dollar has stabilized somewhat recently, some warn that one of the bulls’ big cases for owning bitcoin — as a hedge against currency declines — no longer exists.
“The bitcoin chasers here are not protecting themselves versus a dollar meltdown, they are simply paying twice as much for an ‘asset’ than they were at Thanksgiving,” Mike O’Rourke, chief market strategist with JonesTrading, said in a report Thursday.
Still, the bitcoin faithful remain convinced that prices can keep climbing, citing the mainstream adoption of the cryptocurrency by the likes of PayPal and Square as well as increased interest from major investors including Paul Tudor Jones and Stanley Druckenmiller.
Investors mostly shrugged off the BofA warning Friday. Bitcoin rose slightly. It has surged more than 20% in just the past five days.
Author: By CNN