Bitcoin and the Banks (and other news)

News Roundup

Goldman-backed startup Circle buys major crypto exchange Poloniex

Poloniex was a mid-tier crypto exchange, having lost some of its prominence to new competitors like Binance and KuCoin. I take this as 1) a sign of Goldman’s hypocrisy — slandering crypto currencies while buying into the eco-system, and 2) an indication that infrastructure continues to move into place for mainstream adoption.

JP.Morgan finally declares cryptocurrencies are a threat to their business;

Despite JPMorgan Chase CEO Jamie Dimon having called Bitcoin a “fraud,” the big bank is now taking cryptocurrency very seriously—acknowledging the blockchain-based technology as a veritable threat to its future.

In JPMorgan Chase’s annual report, released Tuesday afternoon, the bank counted cryptocurrencies such as Bitcoin and Ethereum as “risk factors” to its business for the first time, recognizing the digital currencies as new forms of competition that could, quite literally, give the bank a run for its money.

“Both financial institutions and their non-banking competitors face the risk that payment processing and other services could be disrupted by technologies, such as cryptocurrencies, that require no intermediation,” the bank (jpm, -0.13%) wrote in the report.

Bitcoin fast and cheap again

Bitcoin transaction fees started 2017 at an average of $0.30 and peaked at over $40 in December.

The fees for sending a Bitcoin transaction are once again, pennies. Though improvement have come online — most notably the lightning network which certain types of transactions “off chain” and faster, and segwit transactions which make them smaller in terms of storage space — the overall reason for the disappearance of scalability issues seems to be that fewer transactions are happening. December saw a lot of speculation. After the January-February crash, there’s less traffic.

Since the beginning of February, Bitcoin’s dominance — ie its representation as percentage of the value of all crypto currencies — has risen from about 33% to 42%.

Reports: Venezuelan ‘Petro’ Cryptocurrency Fails to Raise Any Money

Venezuela has failed to provide evidence that its new national cryptocurrency, launched by Nicolás Maduro’s socialist regime, has raised any money at all, cryptoanalysts have claimed.

Last week, Maduro claimed to have raised $735 million for its “petro” pre-sale, a cryptocurrency supposedly backed by the country’s considerable oil reserves. . . .

As of today, the official website allows you to register — if you’re patient enough to endure a myriad of errors — maybe you’ll get a confirmation email hours later, which you’ll have to click before the timeout expires and only then you can tell the government how much you’re willing to donate to their cause of ruining Venezuela. And when you click the button to buy, nothing will happen.

You can register with a fake name and passport and say you’re going to buy a gazillion PTR. That’s what was launched. There’s no way to actually buy the damn thing or set up a petro wallet.

Even if they were less incompetent, they’d still face an enormous distrust of centrally controlled digital currencies. Goldman Sach’s and company keep talking about launching their own currency. They’ll face the same skepticism.

Vitalik Buterin’s New Idea – Controlling the Tap for a Better ICO

Ethereum creator Vitalik Buterin has criticized the corruption in the ICO space several times. He has proposed an ICO structure in which funds are locked in reserve, and investors can vote to unlock them only after the team completes certain milestones. I expect such decentralized governance to become increasingly prominent.