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Bitcoin investors hoping to make billions may end up with a sack of fool’s gold | Technology

 

Sifting the Yukon river for gold was a waste of time for most of the 100,000 prospectors seeking to make themselves rich in the 1890s. The same can be said of the bitcoin miners who dream of striking it rich by getting their hands on some of the extremely lucrative and painfully elusive electronic currency.

Relatively few people have managed to decipher the codes needed to extract bitcoins from the 21 million locked inside the mathematical problems set by its creator, the software engineer whose true identity is unknown but who goes by the name Satoshi Nakamoto.

Those who have employed enough computer power and code-cracking know-how can consider themselves rich now that the value of one bitcoin has soared from $753 last December to around $10,000. The rest have deployed huge amounts of energy and time for no return.

Should anyone be worried about this turn of events? Or will it go down as a moment in history when an asset was mined, some people got rich and … that was it?

The ambitions of the bitcoin community mean the creation of a new currency must be taken more seriously. Its stellar rise in the last 18 months is likely to have sucked in thousands of speculators, many of them ordinary investors.

And with mainstream financial exchanges looking to host bitcoin as a tradeable asset, or list derivatives of bitcoin on their trading boards, thousands more will be sucked in over the next 18 months.

Where ordinary investors, hunting in large numbers, seek a return on their savings in a high-risk environment, governments are usually minded to regulate.

The idea behind bitcoin was that it should be like any commodity that, once discovered, became increasingly difficult to extract. Like gold, it would become a store of value and make those clever enough to find it and believe in it very rich.

The distributed ledger designed to make each bitcoin account secure and accountable without the need for third parties, like banks, to be involved became for many participants a potential template for all future deposit saving and trading.

To that end, it was also viewed as a replacement currency to the dollar, euro or pound – one that could not be manipulated by central banks, which are only too keen to print extra notes, and thereby devalue the currency, in times of trouble. It is a seductive package that has led many in the banking industry – those most under threat – to call it a fraud.

Goldman Sachs boss Lloyd Blankfein said so last week, adding his voice to JP Morgan’s Jamie Dimon.

Dimon described it as fraud that would ultimately blow up and said the desire to hide funds from regulators and the police meant it was only fit for use by drug dealers, murderers and people living in places such as North Korea. Blankfein was more concerned that its volatile price, which dropped 20% in less than 24 hours after topping $11,000 last week, disqualified it from being a sensible currency.

Sir Jon Cunliffe, a deputy governor of the Bank of England, summed up the view of many in the City when he said calmly that bitcoin was a sideshow and too small to pose a systemic threat to the global economy.

To cover his flank against accusations that the Bank, which is the UK’s chief financial regulator, was too dismissive of the issue, he also cautioned that bitcoin investors needed “to do their homework”.

No doubt all bitcoin investors think they have done their homework. And regulators probably think they have enough work to do. But while it is easy to say that a fool and their money are soon parted, anyone who interacts with the financial services industry is a potential victim. And, with this in mind, regulators should be ready to impose all the usual tools of misselling rules and compensation schemes on this freshly minted industry.

At the moment, bitcoin is having a free ride. The tipping point is close. Regulators should be prepared.

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Onegold Customers Can Now Purchase Digital Bullion With Bitcoin

Online bullion marketplace Onegold announced on Tuesday that its customers can now purchase precious metals with bitcoin cash (BCH) and bitcoin core (BTC). Onegold’s digital silver and gold products are fully allocated physical metals stored at the Royal Canadian Mint and can be redeemed at any time through Apmex.

Onegold Now Accepts Cryptocurrencies

Onegold Customers Can Now Purchase Digital Bullion With Bitcoin Cryptocurrency proponents can now purchase digital gold and silver bullion products on the Onegold platform using BCH and BTC. Onegold is a blockchain-based platform that stores precious metals and allows customers to redeem their digital bullion holdings at any time. The concept was created by the precious metals e-retailer Apmex and alternative asset manager Sprott. Their recent decision to support BCH and BTC is due to a partnership with Bitpay which already has a prior relationship with Apmex.

“Bitpay and Apmex have worked together for years, making it easy for Apmex to accept cryptocurrency — When they started Onegold, we were ready to help them accept bitcoin and bitcoin cash through Bitpay,” explained the chief commercial officer at Bitpay, Sonny Singh.

Singh continued:

Cryptocurrency is an ideal payment method for e-commerce and precious metals where the risk of chargebacks, fraud and identity theft with traditional credit cards is high.

International Bullion Buyers Are Interested in Alternative Payment Methods

Onegold Customers Can Now Purchase Digital Bullion With Bitcoin Ken Lewis, chief executive officer at Onegold, explained that credit card chargebacks were one of the big reasons the company chose to accept BCH and BTC. Because the digital assets act like cash and are a “push transaction” system, users need to pay for products up front, making traditional fraud cases much harder to accomplish. Lewis also detailed that blockchain payments provide greater accountability and some international buyers are more apt to purchase Onegold’s collateralized assets using cryptocurrencies.

“We anticipate a large number of cryptocurrency buyers from international markets, where accepting credit cards is not always practical,” Lewis explained during the announcement. “In addition to helping protect our own interests, adding bitcoin and bitcoin cash to the payment options for Onegold also increases our payment transparency and efficiency.”

Onegold Believes Cryptographically Secured Metals Are Better Than Exchange-Traded Funds

Onegold believes that its digital bullion is far superior to gold-backed paper like exchange-traded funds (ETF), such as the gold trust Comex and LBMA Gold. Both products are similar because they can be electronically traded, but Onegold is cryptographically secured by a distributed ledger and has 100 percent physical metal backing.

Onegold Customers Can Now Purchase Digital Bullion With Bitcoin
The Onegold system.

Onegold customers can redeem their stored assets with the click of a button, and have physical metals shipped to their door by Apmex. Quite a few gold and silver ETFs cannot be redeemed so quickly and some cannot be traded for physical assets at all, making customers settle for fiat. Onegold believes adding the ability to purchase digital metals with cryptocurrencies was the company’s next logical step.

What do you think about Onegold adding BCH and BTC support for digital bullion purchases? Let us know in the comments section below.


Images via Shutterstock, Onegold, and Pixabay.


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The post Onegold Customers Can Now Purchase Digital Bullion With Bitcoin appeared first on Bitcoin News.

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Xsolla Adds MobileGO (MGO) as New Payment Method for Developers and Gamers Globally

OCTOBER 22, 2018 — LOS ANGELES — Xsolla, which provides game developers with a comprehensive suite of flexible tools and services to help launch, monetize and scale their games globally, today started accepting made-for-gaming cryptocurrency — MobileGO (MGO) — for its PC and mobile games partners.

For the first time ever, developers are able to receive royalty payouts in a cryptocurrency, MGO, on a sliding scale percentage of their choice. As more and more digital entrepreneurs move their savings and retirement investments to the blockchain, Xsolla is there to help its clients cash out in whatever currency is most convenient for them.

“Xsolla’s mission is to always be at the forefront of innovative technology, continuously adding tools and services that enable developers to grow and monetize their games globally,” said Aleksandr Agapitov, founder and CEO of Xsolla. “MGO will accelerate transformative opportunities for our community. Game developers will now receive their royalty payouts much faster, and owners of MGO will soon be able to engage in peer-to-peer match play and organize decentralized gaming tournaments in a way never before possible. MGO is essentially the Bitcoin of the gaming industry, the most trusted cryptocurrency that Xsolla is making available to more than half a billion gamers today.”

Gamers now have more choice to pay for games and in-game transactions with the addition of MGO to Xsolla’s over 700 payment methods. With a current roster of over 500 games — and more added daily — that can accept the tokens, the audience continues to grow. Xsolla’s tools and services operate in over 200 countries and territories, more than 20 languages, and 130 currencies. It is the only payment platform and end-to-end product suite focusing solely on the game development community worldwide.

In addition to gaining popularity with gamers, preparing for this massive adoption MGO tokens have managed to secure their position on major exchanges such as Bitfinex, DigiFinex, BitForex, HitBtc and GateCoin.

About MGO
MGO is Etherium based ERC223 token created to foster a new era in the gaming industry. Its ultimate goal is massive adoption becoming a universal currency for 2.6 billion gamers worldwide, and help both large and small game developers to grow their business as well as to provide gamers with benefits of smart contracts and transparency. For more information, visit https://www.mobilego.io or watch this video.

About Xsolla
Xsolla gives video game developers, publishers, and platform partners access to the flexible tools, services, and collaboration needed to launch, monetize, and scale their games and products globally. Serving only the video game industry, the Xsolla product suite caters to businesses from indie to enterprise, with: Pay Station and its #1 Anti-fraud solution, Partner Network, Site Builder, Store, Login, and Launcher. Headquartered in Los Angeles, with offices worldwide, Xsolla operates as a merchant and seller of record for major gaming entities like Valve, Twitch, Ubisoft, Epic Games, and PUBG Corporation. For more information, visit www.xsolla.com.

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Japanese Regulated Exchange Zaif Hacked – Nearly 6000 BTC Stolen

Japanese government-approved cryptocurrency exchange Zaif has confirmed that it has been hacked. After a preliminary investigation, the exchange says at least 5,966 BTC have been stolen, with an estimated total damage of $60 million. Some of the stolen coins belong to the exchange but the majority belong to customers.

Also read: 160 Crypto Exchanges Seek to Enter Japanese Market, Regulator Reveals

Zaif Hacked

Japanese Regulated Exchange Zaif Hacked – Nearly 6000 BTC StolenJapanese crypto exchange Zaif has been hacked, its operator announced on Wednesday, Sept. 19. Tech Bureau Inc., which operates Zaif, explained that the exchange “detected server abnormality” on Monday and immediately suspended several services, including deposit, withdrawal, and merchant payment services.

The company revealed that unauthorized access to its hot wallet was detected between 17:00 and 19:00 on Sept. 14, elaborating:

Some of the deposit and withdrawal hot wallets were hacked by unauthorized access from the outside, and part of the virtual currencies managed by us was illegally discharged to the outside.

Japanese Regulated Exchange Zaif Hacked – Nearly 6000 BTC StolenThe exchange believes that three cryptocurrencies may have been stolen: BTC, BCH, and MONA. While it has confirmed that 5,966 BTC were stolen, the theft of the other two cryptocurrencies is still being investigated. Tech Bureau explained that the extent of the damage is currently unknown because the exchange’s server will not be restarted until it is confirmed to be secured in order to prevent further damage. Nonetheless, the company clarified:

It is estimated that the total loss due to the damage…is equivalent to about 6.7 billion yen [~US$60 million] (including MONA and BCH) in Japanese yen.

Out of the total damage, the company says 2.2 billion yen (~$19.6 million) belong to the exchange and 4.5 billion yen (~$40 million) belong to customers. Tech Bureau said it has asked for 5 billion yen (~$44.6 million) in assistance from a subsidiary of Fisco Ltd. to help repay affected customers, Kyodo News described.

Investigating and Rebuilding

In its announcement, Tech Bureau stated that it reported the breach to the Treasury Department on Sept. 18. “This case is a criminal case,” the company wrote, adding that it has requested an investigation into the breach. The company detailed:

Currently, we are checking and strengthening security, rebuilding the server, etc., in order to restart the system of depositing / withdrawing virtual currency.

The Osaka-based exchange, established in 2014, is one of the 16 government-approved crypto exchanges in Japan. The country’s Financial Services Agency (FSA) issued the company two business improvement orders: the first was on March 8 and the second on June 22. The agency ramped up its oversight of crypto exchanges after hackers stole 58 billion yen (~$534 million) worth of the cryptocurrency NEM from Coincheck in January.

What do you think of Zaif’s hack? Let us know in the comments section below.


Images courtesy of Shutterstock and Zaif.


Need to calculate your bitcoin holdings? Check our tools section.

The post Japanese Regulated Exchange Zaif Hacked – Nearly 6000 BTC Stolen appeared first on Bitcoin News.



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