Schlagwortarchiv für: Bitcoin

The legislation enables banks to sell and store cryptocurrencies from January 1, 2020. Other providers will now require a German license.

The German parliament today passed a bill allowing banks to sell and store cryptocurrencies from next year.

The new legislation will come into force on 1 January 2020, and will require current custody providers and crypto exchanges operating in the country to take steps, before the end of the year, to apply for a German license.

The law will not only put Germany, the world’s fourth biggest economy, at the forefront of regulation in cryptocurrencies, but heralds a milestone in the adoption of cryptocurrencies.

“Germany leads the way in crypto regulation, for sure. This leads to institutional investors coming to Germany, as they want security and regulation,” Sven Hildebrandt, partner at German crypto consultancy DLC, told Decrypt. „Germany is well on its way to becoming a crypto-heaven.”

The bill was passed by the Bundestag, the lower house of the German Parliament, earlier this month,  and approved by the upper house, the Bundesrat, today.

It amends a clause in the European Union’s Fourth Anti-Money Laundering Directive that currently prohibits banks from dealing directly in cryptocurrency. It  allows them to legally sell and store cryptocurrencies, just as they do stocks and bonds, to retail as well as institutional investors.

At the same time, exchanges such as Binance and Kraken, and other digital asset custodians, will need to obtain a license from the German regulator, Bafin, if they wish to continue operating in Germany, said Hildebrandt.

In order to apply for this, companies will need a German legal entity with two directors operating in the country by the end of 2019. They also need to signal their intention to apply to Bafin for a license before 31 March 2020, and submit the application prior to 31 November 2020.

Digital asset custodians who have not established a legal identity in Germany before the end of the year will be deemed illegal by 2 January 2020, said Hildebrandt.

He said this leaves companies wishing to continue provide services in Germany with three options: to set up a German company before the end of this year, and then apply for a licence; to work with a cryptocurrency custodian who is licensed in Germany, or to work with a licence provider, which can offer a “complex but clever“ solution.

Companies have already begun to act on the new German law. Crypto Storage, a subsidiary of Swiss financial services provider, Crypto Finance announced plans to open an office in Frankfurt today.

Hildebrandt said that the new law will be a major breakthrough. “If you can hold [cryptocurrencies] in your bank account, that is massive for adoption,” he said. “I believe that this will act as a role model for all the other laws that will be coming into force Europe wide. Germany is driving crypto adoption forward and wants to play a leading role in Europe as well. One of the key challenges is keeping private keys safe.”

“I believe the biggest impact will be on exchanges such as BitStamp, Kraken and Binance, who are looking deeply into this,” he added.

The proposals were also greeted with enthusiasm by Germany’s banking community.

But consumer protection watchdogs have warned that it could mean banks could aggressively pitching cryptocurrencies to uneducated customers, putting them at risk.

Source: https://decrypt.co/12603/new-law-makes-germany-crypto-heaven

“The stock-to-flow approach originating in commodity-market analysis serves to quantify the ‘hardness’ of an asset. Applied to Bitcoin, an unusually strong correlation emerges between the market value of this cryptocurrency and the ratio between existing stockpiles of Bitcoin (‘stock’) and new supply (‘flow’),” they say.

Source: https://www.bayernlb.com/

Es hat ein wenig gedauert, bis das Bundesfinanzministerium das Urteil des Europäischen Gerichtshofs zur bundesdeutschen Tatsache gemacht hat. Aber nun ist es soweit. Sorgen, dass es irgendwie doch noch zu einer Verumsatzsteuerung von Bitcoin-Verkäufen kommt, haben sich damit endgültig erledigt.

Nachdem wir vor etwa zwei Wochen die Meldung hatten, dass das Finanzamt Bonn-Innenstadt versucht, von einem Bitcoin-Unternehmer die Umsatzsteuer für den Verkauf von Bitcoin zu verlangen, hat dies für ein gewisses Entsetzen in der Szene gesorgt. Unbestätigten Berichten zufolge hat dies zu Schlaflosigkeit unter Bitcoin-Tradern geführt und in einem extremen Fall sogar eine Psychose ausgelös. Manch ein Trader begann, sich wegen der potenziell hohen Umsatzsteuernachforderung um seine wirtschaftsliche Existenz zu fürchten. Mit ausgelöst wurde die Unruhe etwa durch Berichte des Steuerberaters Rüdiger Quermann sowie des Rechtsanwalts István Cocron.

Experten wie der Steuerberater Diplom-Kaufmann Christian Densch aus Essen, der als „Kryptotaxpert“ Gastgeber einer beliebten Facebook-Gruppe ist, haben von Anfang an energisch darauf hingewiesen, dass hier unnötig Panik verbreitet wird. Die Forderungen des Finanzamtes Bonn-Innenstadt seien in keinster Weise zu halten. Sie seien auch kein Ausfluss einer wie auch immer gearteten Verschwörung der Finanzämter, die nun versuchten, Bitcoin kaputt zu machen und die Bitcoin-Trader zu ruinieren, sondern lediglich das Ergebnis einer gewissen Trägheit der Behörden. Es sei weder notwendig, sich Sorgen zu machen, noch angebracht, Ängste zu schüren oder gar das persönliche Armageddon zu verkünden.

Wie sich bald darauf zeigte, hat der Steuerberater Christian Densch recht. Ihm gelang es im persönlichen Gespräch und einem darauf folgenden E-Mail-Verkehr, eine zur Veröffentlichung freigegebene Einschätzung von Dr. Christian Hufen zu bekommen. Dr. Hufen ist Persönlicher Referent des Parlamentarischen Staatssekretärs des Bundesministeriums für Finanzen, Dr. Michael Meister. Er schreibt, dass sich Kryptotaxperts „Vermutung, dass der Umtausch von Bitcoins in andere Währungen unter eine Umsatzsteuerbefreiung fällt, bestätigt“ hat. Es gilt die Entscheidung des Europäischen Gerichtshofes im Fall Hedqvist. „Danach handelt es sich bei dem Umtausch konventioneller (gesetzlicher) Währungen in Einheiten der virtuellen Währung ‚Bitcoin‘ und umgekehrt um eine Dienstleistung gegen Entgelt, die unter die Steuerbefreiung nach Art. 135 Abs. 1 Buchst. e der Richtlinie 2006/112/EG des Rates vom 28. November 2006 (sog. EU-Mehrwertsteuer-Systemrichtlinie, MwStSystRL) fällt.“

Der Steuerberater Densch hat noch einige weitere Fragen gestellt – etwa zum Mining oder zur steuerlichen Handhabung von Zahlungen mit Bitcoin – auf die der Persönliche Referent interessante, und im großen und ganzen auch erfreuliche Antworten gibt. Aber dazu ein andermal mehr. Hier sollte man feststellen, dass das Thema der Umsatzsteuer für den Verkauf von Bitcoins vom Tisch war.

Ein Schreiben des Bundesfinanzministeriums an die obersten Finanzbehörden der Länder vom 27. Februar, das auf der Webseite des Ministeriums veröffentlicht ist, bestätigt nun auch gegenüber den Behörden die Anwendung des Urteils des EuGH und bestätigt den Inhalt der E-Mail, die “Kryptotaxpert” bereits am 21.02.2018 auf seiner Seite veröffentlicht hat. Beim Umtausch von Bitcoin in Euro handelt es sich um eine „steuerbare sonstige Leistung, die im Rahmen einer richtlinienkonformen Gesetzesauslegung nach § 4 Nr. 8 Buchst. b UStG umsatzsteuerfrei ist.“ Die Grundsätze dieser Anordnung seien in allen offenen Fällen anzuwenden. Wer also sich noch irgendwie von der Umsatzsteuer bedroht fühlt, kann nun offiziell aufatmen.

Warum aber hat das Bonner Finanzamt nun trotz all dem einen Umsatzsteuerbescheid erlassen? Die Antwort darauf dürfte einen interessanten Einblick darin geben, wie deutsche Behörden zu arbeiten verpflichtet sind. Die Hauptsachgebietsleiterin Betriebsprüfung und Gewerbesteuer beim Finanzamt Bonn-Innenstadt verwies im Rahmen eines Telefonats mit Herrn Densch darauf, dass ohne Anwendungsschreiben der vorgesetzten Behörde ein EuGH Urteil nicht unmittelbar durch das Finanzamt umgesetzt werden darf. Unglücklicherweise orientierte sich die Verwaltungsmeinung noch an der Auffassung des BMF die Umsätze mit Bitcoin unterliegen der Umsatzsteuer. Das Finanzamt Bonn-Innenstadt hatte somit keine andere Wahl, als den mißliebigen Bescheid zu erlassen, auch wenn es sich selbst im klaren war, dass dieser nicht rechtens sein kann.

Es wäre interessant, wenn sich der Betroffene auch einmal zu Wort melden würde, bei der Aufregung, die um dieses Thema erzeugt wurde, dürfte ihm das ja nicht entgangen sein.

Source: https://bitcoinblog.de

On May 6, 2010, the stock market collapsed. The Dow Jones Industrial Average, Nasdaq Composite and S&P 500 all nose-dived, losing around 9% of their value. A trillion dollars was wiped off the value of companies. Within 20 minutes, most of the losses had been regained and within 36 minutes and the event was over. Whatever hit the economy that day had nothing to do with the true state of America’s finances.

An investigation into the Flash Crash focused on the algorithms used by high-frequency traders, companies that rapidly buy and sell stocks as their computer programs spot small price differences across the market. Five years later, police arrested Navinder Singh Sarao, a small trader who was believed to have made more than $40 million during the crash. Trading from his small house in London, he was alleged to have used a computer program to rapidly place sell orders to drive down prices, cancel the orders before the trades went through, then buy the stocks at the lower rate. He wasn’t the only one to make money that day, but his actions were enough to help move the market.

Weiterlesen

If invested 1k USD in the top five:

BTC: 10875 USD (not considering BCash)

ETH: 38900 USD

RIPPLE: 30959 USD

LTC: 18035 USD

DASH: 68439 USD

Total: 167.208 USD

Prior to Bitcoin, the process for maintaining the transaction ledger remained effectively unchanged since the Medici developed double entry accounting in the 14th century. The Medici process of accounting required banks…

Bitcoin is going to do to banks what email did the post office and Amazon did to retail. Understandably those at the center of the financial system are concerned.

The banker’s mantra of “blockchain not bitcoin” has caught fire on Wall Street – everybody loves blockchain, they may not know what it is, but they love it! Jamie Dimon, CEO of JPMorgan, hates Bitcoin, but loves blockchain, Goldman Sachs CEO, Lloyd Blankfein, has embraced blockchain while he is warming to Bitcoin. Admittedly, I suffered from the same love affair with blockchain. As an early adopter of Bitcoin I still had feelings for the currency, but for a period of time I was infatuated with blockchain.

Weiterlesen

Blockchains are beginning to turn green. This post describes some of the IC3 research in this direction.

The glorious view from our windows at Cornell Tech takes in 432 Park Avenue, the tallest residential building in the world. This tower is a monument to many things. Above all, for a student of Financial systems, it epitomizes ways to store wealth with breathtaking waste. (Fittingly, it was inspired by a wastepaper basket, shown to the right.) Buildings like it are sprouting up around NYC as investment vehicles for the ultra-wealthy, and their owners don’t actually live much in them. 432 Park and its ilk are essentially hollow vaults.

Something similar can be said for Bitcoin. As a concept and technological inspiration, Bitcoin is a marvelous thing. And unquestionably like 432 Park, it does see legitimate and valuable uses (and some shady ones). As a currency, though, Bitcoin serves in no small degree as a wasteful and ecologically damaging way for people to park their money.

There are a number of ways to substantiate this claim. One is in terms of its electricity consumption. Estimates vary, but it is likely that the Bitcoin network consumes roughly as much electricity as a nuclear reactor, about 1/3 of the entire electricity consumption of the entire country of Ireland. (See our back-of-the-envelope calculations in the blog notes.) To view this in another light, a recent IC3 paper estimated the cost-per-confirmed transaction at as much as $6.20 in capital costs and electricity. (Transaction rates have been rising, and today the figure is substantially lower, but still high.) That’s $6.20 in resources per transaction to move money between accounts in the same system.

Bitcoin proponents argue that this is simply the cost of decentralization. A credit-card network doesn’t provide the pseudonymity, freedom from government interference, portability, and other features of Bitcoin, so it isn’t comparable. This is true. But it isn’t a law of nature that a system like Bitcoin should be so resource-intensive. Researchers at IC3 believe that the many benefits of Bitcoin can be had without the waste. In a few papers released over the past month or so, we’ve outlined three different approaches to the development of greener alternatives:

  1. PieceWork is a tweak to standard cryptocurrency PoWs that enables recycling of mining effort.
  2. Resource-Efficient Mining (REM) repurposes innately useful workloads for mining effort. It relies on use of a trusted hardware technology called Intel SGX.
  3. Snow White is the Proof-of-Stake system with rigorous security guarantees.

PieceWork: Recycling PoWs

PatchWork

If we can’t reduce waste at the source, why not recycle? That’s the premise of the first, and simplest idea, called PieceWork. Piecework involves a slight modification to the standard Proof-of-Work (PoW) construction, decomposing it into two layers. One layer produces small PoWs called puzzlets that play a critical role in the mining process and can also, as we shall show, serve useful non-mining purposes.

Consider a standard cryptocurrency, abstracting away into a single value X the details of what gets hashed into a PoW (transactions, the previous block, etc.). A miner’s task then is is simply to search for an input (“nonce”) n∈N for which

H(X, n) ≤ Z,

where Z is a threshold representing the difficulty of the PoW.

To decompose a PoW into two layers, we instead construct it as follows:

H(X, n) = Fout (X, Fin (X, n; rin ), rout ),

where rin = H0(r) and rout = H1(r) for distinct hash functions H0, H1 and a secret value r. (These two values are a technical requirement to prevent what are called block withholding attacks. See the blog notes.)

A valid solution is a value n such that

Fin (∙, n, ∙) < Zin and Fout (∙, n, ∙) < Zout.

To solve this puzzle or PoW, a miner must first find an n such that Fin (∙, n, ∙) < Zin. This inner-puzzle is what we call a puzzlet. To solve the whole PoW, a miner must find a puzzlet solution. The puzzlet solution must additionally satisfy Fout (… n…) < Zout, meaning that a miner must in general come up with many puzzlet solutions to solve the PoW as a whole. By setting Zin + Zout = Z, one obtains a PoW with the same difficulty as that in (1).

What’s the benefit of this two-layered structure? A puzzlet, i.e., the task of finding a solution n to Fin (∙, n ,∙) < Zin, can be outsourced by a miner or mining pool operator to a worker, and put to any of several non-cryptocurrency goals. DoS prevention for TLS is one example. TLS requires computationally intensive crypto operations from a server to set up connections. Thus it’s a natural target for DoS attacks, prompting the idea of requiring clients to solve PoWs if a server comes under attack, an idea now floated in an IETF proposal. These PoWs used for DoS mitigation can themselves be puzzlets. The effect is that the server becomes a mining pool operator, and its clients become workers. And a DoS attacker effectively showers the victim HTTPS server with cryptocurrency. (Of course, a server can also dispense puzzlets and make money even when it’s not under attack…) Other examples of puzzlet uses are spam prevention (the original PoW goal proposed by Dwork and Naor), MicroMint, and Tor relay payments.

In summary, PieceWork requires only a small modification to standard cryptocurrency PoWs. It turns them into dual-use computational problems and recycle wasted mining effort. How much recycling it can feasibly accomplish is an open research question. PieceWork benefits from a number of previous, related ideas. Our short paper on it can be found here. PieceWork will be presented in April at BITCOIN 2017.

Resource-Efficient Mining (REM): Using Innately Useful Work as Mining Effort

Efficient Miner

A very different approach to minimizing waste is embraced in our second project, a system called REM. Rather than relying on hash-based PoWs, it makes use of an entirely different type of PoW, in which the W, i.e., the work, is useful. We call this concept Proof of Useful Work (PoUW).

Of course, traditional PoWs have several useful properties, prime among them the ease with which solutions can be verified. Most workloads don’t have this property. To enable verification of work on arbitrary useful workloads, REM relies on a new technology: Intel SGX.

Intel’s new SGX (Software Guard eXtensions) trusted execution environment technology. In a nutshell, SGX enables the execution of an application in a hardware-protected environment, called an enclave, that is isolated from the operating system and other applications. It thus protects the application against tampering by even the owner of the machine on which it’s running. SGX also enables generation of an attestation that proves to a remote party that a particular application was running in an enclave. SGX is already supported in many recent-model Intel CPUs.

As a good way to see how SGX can facilitate mining, it’s worth discussing an elegant mining scheme proposed by Intel called PoET (Proof of Elapsed Time). The idea behind PoET is simple. If miners use SGX, then they can be forced to use only a sanctioned piece of mining software that simulates PoWs. Standard PoWs have solution times that are exponentially distributed. A PoET client can thus sample a solution time from an exponential distribution, simply sit idle until this time elapses, and then wake up with a block in hand. The first client to awake gets to publish its block. An SGX attestation proves to others in the system that the client idled as it should have.

PoET has several nice features. Foremost among them is the fact that (at first glance) it’s virtually energy-waste-free. Clients idle instead of hashing. Block solution times can be tuned to mimic those of a standard mining regime, like Bitcoin or Ethereum mining. Thus PoET can effectively be plugged into such schemes. It is also relatively egalitarian in that it achieves precisely one vote per CPU. PoET, though, has two technical challenges. We call these the broken chips and stale chips problems.

First, the broken chips problem. SGX security is imperfect and, as with any trusted hardware, it’s to be expected that a well-resourced adversary can break it. Thus, it’s to be expected that some SGX CPUs will be broken. In the basic PoET scheme, a broken chip has devastating effect, as it enables a miner to simulate a zero mining times and win every consensus round, i.e., publish all blocks. Intel has proposed a statistical testing regime to detect breaks, but details aren’t published and formal foundations are needed for a good analysis.

REM faces the same challenge. In REM, we have developed a rigorous statistical testing regime with formal foundations and shown analytically and empirically that it is highly effective: It can strictly limit the gains of adversaries that have broken chips while minimizing incorrect rejection of blocks from honest miners.

The stale chips problem is more subtle. Our economic analysis shows that in many practical settings in PoET and related systems, it will be advantageous for a miner to buy old (“stale”) SGX CPUs and cobble them together into “farms” that mine cheaply. Such farms reinstate a fraction of the waste that PoET is trying to avoid to begin with. This is where REM’s Proof of Useful Work (PoUW) approach comes into play. In a nutshell, with PoUW, miners run whatever workloads they consider to be useful—protein-folding computations and ML classification algorithms are a couple of examples considered in our work. Miners can prove that they did work on these problems using SGX. The probability of a miner mining a block is proportional to the amount of work she does. Thus, REM turns otherwise useful work into mining effort. Making PoUW work is technically challenging. It requires that workloads be themselves compiled and instrumented using SGX to prove correctness, an innovation of independent interest introduced in REM.

The biggest objection lodged against SGX-based mining is the fact that it places Intel in charge, undermining the decentralization at the heart of permissionless ledgers. Of course, Intel is already a trust anchor. But we’d view this another way, and characterize REM and PoET as partially decentralized. You can read about REM here, in a paper under submission.

Snow White: Proof of Stake with Rigorous Security Guarantees

PatchWork

Our final approach to reducing cryptocurrency waste is one both proposed and studied by many projects in the cryptocurrency community since the inception of Bitcoin. This idea is called proof of stake, and revolves around the basic premise that rather than mining simulating a lottery where your chance of finding a block is proportional to computing power, mining simulates a lottery where your chance of finding a block is proportional to the number of coins (or “stake”) you have in the system.

A key roadblock to the adoption and deployment of proof of stake systems involves questions around the security guarantees that they provide. This continues to be an ongoing source of controversy and debate in the community, with sources like the Bitcoin Wiki claiming that “Proof of Stake alone is considered to an unworkable consensus mechanism” and efforts like Ethereum’s Casper project studying questions of how to design a maximally useful and relevant proof of stake protocol for the next generation of cryptocurrencies.

Despite its potential shortfalls, we believe proof of stake represents a critical new development and direction in both the blockchain and distributed consensus fields. With this in mind, we set out to apply previous work by Rafael Pass (an IC3 member) and others, in which a model for analyzing and proving consistency, chain growth, and restrictions on adversarial chain impact for proof of work blockchains was developed.

To more accurately model the nature of blockchain distributed consensus, and the implication of network delays, we propose a new model for consensus called the sleepy model. This model more accurately mimics the operation and naturally captures the design of permissionless blockchains. In the sleepy model, a user (node or miner) can leave or join the protocol at will. This is modeled by (non-crashed) users in the protocol being given the ability to “sleep”, or go offline and rejoin the network at some unspecified later date with unmodified original state. The key question then becomes how can we design a useful consensus protocol in the sleepy model, when at least half of all online nodes (or stake) is honestly following the protocol?

The guarantees of consistency and availability are rigorously defined in this new model, more accurately capturing the guarantees users expect from blockchain protocols. The analogues of proof-of-work style guarantees like chain growth (availability) and chain quality (integrity) are also discussed. We believe this new class of consensus protocols in the “sleepy” model represents one of the fundamental contributions of blockchains to the distributed consensus space. Neither the asynchronous, partially synchronous, or synchronous models, in either a permissioned or permissionless setting, prove sufficient to model or reason about these new consensus protocols or the probabilistic and often economic guarantees they provide.

To that end, we are working on two protocols proven in the Sleepy model: Sleepy and Snow White.

Sleepy is a simple protocol intended to achieve the guarantees of chain quality, chain growth, and consistency/agreement with 51% of online nodes being honest. This protocol is intended for deployment in a permissioned context, and assumes stake assigned or instantiated by some trusted source. This makes Sleepy ideal for bankchains or other permissioned deployments, in which the set of stakeholders is known a priori but the blockchain guarantees of robust, auditable distributed consensus remain desirable. Every second, every member of the committee is eligible to “mine” a new block in the system, which involves a standard block mining solution with a public source of entropy as the nonce. Standard difficulty adjustments retarget the block interval to a desired target, as in Bitcoin and Ethereum today. The challenges of choosing an appropriate, ungameable mining function and source of entropy are tackled in the work, and proof is given that no committee member can manipulate the protocol to their advantage.

Snow White, on the other hand, is an extension of Sleepy intended to provide the same rigorous blockchain-derived guarantees in a permissionless setting, such as in the deployment of a public cryptocurrency. Obviously, this is substantially more difficult: choosing appropriate committee members for the block lottery, as well as ensuring that no coalition of these committee members (of bounded size) can game the protocol for more than a negligible advantage, are highly nontrivial. The resulting protocol is actually quite simple: each step, a committee mines as in Sleepy, with a shared source of entropy h0. With sufficiently many bits of entropy in h0 and an appropriately selected committee weighted on stake, it is possible to prove the desired result of chain quality, growth, and consistency in the Sleepy model. Choosing both the committee and h0 such that no adversary or non-majority coalition of adversaries gain substantial advantage by deviating from the protocol is the key to the construction and concrete parameters of the protocol, which are discussed further in our full publication.

Sleepy and Snow White represent the first rigorously justified and proven blockchain consensus protocols in both the permissioned and permissionless proof of stake space. It is our belief that the rigorous proofs of security are valuable as both theoretical efforts and to guide protocol development and deployment. Both the proof and concrete parameterization of these protocols are highly non obvious, and while heuristic protocols designed elsewhere in the community (with only informal justification) may operate in a similar manner to Sleepy, there is no guarantee that subtle network-level, timing, committee / stake poisoning, and other attacks are not present in these protocols. In our work, we assume an optimal adversary with ability to delay network messages up to some arbitrary time, a very strong notion of attacker that makes our protocols the most rigorous conceived in the space thusfar.

You can read about the papers in prepublication manuscripts we have uploaded for release on ePrint: Snow White, Sleepy. Further conference or journal publications with implementation details of these systems, full proofs, simulation results, and experimental comparisons to existing cryptocurrencies are currently in development. We hope to share more exciting news about these new protocols soon.

[It is worth noting that our willingness to assume that the majority of online coins are honestly following the protocol is an assumption that `has been challenged <https://blog.ethereum.org/2016/12/06/history-casper-chapter-1/>`_ by the Ethereum foundation. We do not necessarily agree with these criticisms or model; we believe that the ε-Nash equilibrium achievable in *Snow White is sufficient for the design of a robust, decentralized coin. Nonetheless, we believe developing and proving protocols secure in this context is valuable: both as the most natural model for private blockchain deployments, and to illuminate common pitfalls in proof of stake protocol design that may lead to attacks in naive protocols. We look forward to a full specification of Ethereum’s Casper, and to comparing both its assumptions and attack surface with that of Snow White.

Notes

Back-of-the-envelope Bitcoin electricity consumption calculation

There are many estimates of the electricity consumption of the Bitcoin network, but we don’t find them convincing. For example, this widely cited one derives an upper bound of 10 GW (in 2014!). As we’ll see from a simple calculation below, that would imply that miners were losing huge amounts of money. So here’s our crack at a crude estimate.

Using the technique in this paper, to obtain a lower bound on electricity consumption, let’s take the Antminer S9 to represent the state of the art in mining rigs. It consumes 0.098 W/GH. The current mining rate of the Bitcoin network is about 3,330,000 TH/s. Thus, were all miners using Antminer S9s, the electricity consumption of the network would be about 326 MW. (Of course, many miners are probably using less efficient rigs, so this is a loose lower bound.)

To obtain an upper bound on electricity consumption, assume that miners are rational, i.e., won’t mine if it causes them to lose money. At the current price of about $1000 / BTC, given a 12.5 BTC mining reward and block production rate of about 6 blocks per hour, the global mining reward per hour is about $72,500. A common, extremely cheap form of electricity used by miners is Chinese hydroelectric power; the very low end of the levelized cost of such electricity is $0.02 / kWh. Thus rational miners will consume no more than 3.625 GW of electricity. (Of course, this estimate disregards the capital costs of mining, and is therefore probably a quite loose upper bound.)

Taking the log-average of these two bounds yields an estimate of 1.075 GW, about the output of a single unit in a nuclear power station. Ireland’s average electricity consumption is about 3.25 GW (as derived from this 2013 figure).

Again, this is a crude estimate, but we believe it’s probably within a factor of 2 of the real one.

Why use rin and rout in PieceWork?

It is possible to outsource mining with the standard cryptocurrency PoW H(X,n) ≤ Z, simply by declaring a puzzlet to be the problem of finding an n such that H(X,n) ≤ Z_{easy}, for some Z_{easy} > Z. In other words, a worker can be asked to find a solution to a PoW easier than the target. But with some probability, a solution to H(X,n) ≤ Z_{easy} will also be a solution to H(X,n) ≤ Z, i.e., will solve the outsourcing miner’s PoW.

The problem with this approach is that a malicious worker can mount a block withholding attack. If it happens to find a solution to H(X,n) ≤ Z, it can simply not submit it. Or it can demand a bribe from the outsourcer. Use of rin and rout conceals from a worker whether or not a puzzlet solution is also a solution to the global PoW, preventing such attacks.

Quelle: The Greening of Blockchains

Ripple users can make payments to Bitcoin addresses directly from Ripple Trade.

Here’s how it works:

It’s that simple.

We call it a “Bitcoin Bridge” and it gives Ripple users access to the entire Bitcoin economy. Please note that payments through the Bitcoin Bridge may take a significant amount of time to be processed.

What Is The Bitcoin Bridge?

Ripple users can make a payment in any currency — dollars, euros, etc. — and the Bitcoin merchant will receive the payment in Bitcoins.

That’s good for Ripple users and it’s also good for Bitcoin merchants.

Thanks to the Bitcoin Bridge, all Bitcoin merchants now accept payments from Ripple users. More than 8,500 merchants are now available on the Ripple network:

And thousands more…

How Does It Work?

The Bitcoin Bridge is a simple protocol that connects the Ripple and Bitcoin networks. When you send money from Ripple to a Bitcoin address, an organization running the bridge protocol facilitates the transactions.

The Bitcoin Bridge is operated by SnapSwap. Please reach out to SnapSwap for Bitcoin transaction details.

Currency Inclusive

Ripple was designed to be currency inclusive. Instead of promoting one currency or another, Ripple makes it easy to send payments in any currency and acts as a “universal translator” for money. The Bitcoin Bridge is one more step in Ripple’s mission to connect the disparate Internet payment systems into a single, shared, unified payment network, freely available and accessible to all.

To learn more, read the official press release.

To use Ripple in your business, contact us at .

 

Ripple

One thought on “The Bitcoin Group #40 – New York Regulation Week 2 – Ethereum Pre-Sale – Coinye – Ecuador”. thebitcoingroup. 10/08/2014 at 04:20 · Antworten. Hinterlasse eine Antwort Antworten abbrechen.
ethereum – Google Blogsuche

Presented by Stephan Tual, CCO. Companion Document: https://medium.com/@ethereumproject/4790bf5f7743 Ethereum is a platform that makes it possible for any de… Categories : Kryptowährungen. Bookmark the …
ethereum – Google Blogsuche