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Jun 21
Facebook new project LibraCoin

Facebook Revealed Plans for New Project LibraCoin

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Facebook has revealed its plans for their new project, a stablecoin, which is now officially called LibraCoin. The public launch will reportedly happen in the first half of 2020. The media went frenzy and we are now witnessing the opposing views on LibraCoin’s future. But, first, let us explore LibraCoin.

What is LibraCoin

What is LibraCoin is the frequently asked question these days. As majority of other cryptocurrencies, LibraCoin is a digital currency that serves as a means of payment. As expected, the transaction fees that apply to LibraCoin are near to zero. Facebook reportedly announced that the users would be able to buy LibraCoin or get their cash from LibraCoin either online or at local exchange spots.

Facebook has also developed its Calibra wallet. Apparently, it will be governed by Facebook, as a subsidiary of its own. This wallet will be integral part of Messenger, WhatsApp, and other Facebook’s apps. However, it appears we will wait a few more months to be able to use Calibra.

The Libra currency is represented by a 3 wavy horizontal lines character ≋

Advantages of LibraCoin

We all expect LibraCoin to have some advantages over other cryptos. Facebook did not disappoint us in this respect. LibraCoin is fast and less expensive, especially if we use it for international transactions.

Apparently, the companies which accept LibraCoin as means of payment will have discounts or rewards.

This new stablecoin is powered by the Libra Blockchain. This ecosystem is announced as an open-source. It is developed in Facebook’s own Move programming language.

Libra Vs. Bitcoin

With Bitcoin being the leading crypto, we cannot avoid comparing the two . Bitcoin has proved itself as the master of decentralization. On the other hand, LibraCoin is controlled by Facebook and the Libra Association. Furthermore, Facebook declared that they would not have full control over LibraCoin. Other members of the Libra Association will participate in decision making. Among many companies, there are Visa, Uber, Andreessen Horowitz, etc. These members invested more than $10 million each in the project.

Bitcoin’s and Facebook’s blockchains also differ. Bitcoin runs on permissionless blockchain. This means that the miners do not have to ask for approval before they start their mining. LibraCoin’s block chain is permissioned.

Challenges LibraCoin Faces

When launching plans for the new financial ecosystem that has impacts worldwide, it is expected to face certain challenges. As stated above, LibraCoin is centralized and supported by government-backed currencies and securities. They claim that this should secure low risk and avoid fluctuations. Nevertheless, there are voices raising questions. Experts claim that LibraCoin is challenging banking systems, although they doubt this would be the end of the traditional institution. What we can predict at this stage is that LibraCoin will seek to exploit the weaknesses of banking transfers and offer more convenient solutions.

One of the main concerns mentioned in the media is over Facebook’s ability to secure the financial information of their clients. The concern is justified due to the previous breach of users’ personal information. With information about financial transactions, Facebook will now definitely have unrivaled advantage over all other companies in the industry.

Concerns from regulators include the ways LibraCoin will be regulated and in what way exactly Facebook and the Libra Association will be fighting money laundering.

Apparently, making LibraCoin the new leading crypto would take some time. As Facebook Inc. Chief Operating Officer Sheryl Sandberg said, this project is a “long way from launch.” She also added:

“Regulators have concerns. We’re already meeting with them. We know we have a lot of work to do, but this was an announcement of what we would like to do with a roadmap for people to jump in and help us do it.”

 

We would appreciate your thoughts on LibraCoin.

Jun 19
smart city functioning on blockchain

Nevada Introduces Blockchain and Builds a Smart City

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Nevada is the latest US State to recognize the importance of moving to blockchain and accepting it as one of the fastest-growing industries today. Furthermore, Nevada is getting ready to build its one of a kind smart city functioning on blockchain.

During the first half of this month, Nevada legislators passed and signed four bills enabling blockchain investment in the state of Nevada, as well as further development of financial technology, education, innovation and promoting of high-quality jobs. As a quick reminder, virtual currencies are regarded as intangible personal property in Nevada and are therefore exempt from personal property taxation.

Nevada company Blockchains LLC reportedly acquired the German firm Slock.it. The main reason for this acquisition was the project on which Slock.it was doing. Namely, they developed a system which connects devices such as appliances and vehicles to the Ethereum blockchain using minimal bandwidth and power. This was obviously, more than enough for Blockchains to get interested and engage in further development of this project. They bought a piece of land in the Nevada desert (67,000 acres) for reportedly US$155 million, right next to the Tesla Inc. We can hardly wait to see the final result of this project.

Blockchain-Based Energy Supply

While waiting, we cannot but wonder how a smart city looks like? This is the subject where we can all let our imagination run wild. A smart city would, most probably, be energy efficient. Recently, we wrote about the ways in which blockchain can provide the households with opportunity to be energy efficient and to trade with clean energy at lower costs. This pattern can be applied to greater areas.

Imagine entire city running on “green” renewable resources. We can only assume that the next step in this direction would be development of artificial intelligence able to monitor and control the usage of energy in facilities. The purpose of such technology would be to manage the resources properly and to conserve energy as much as possible. Furthermore, if the energy is derived from renewable resources, we will be saving our planet. Regardless of Blockchains LLC, there are already companies who are pioneers in this way of thinking. We may not be aware of this fact because we take many gadgets for granted. Just think about the fact that we are using washers from manufacturers like Whirlpool, Samsung, and LG. These appliances can schedule certain activities in order to allow more efficient management of the power grid.

Blockchain-Based Water Supply

Speaking of water, there are predictions that blockchain-based water management would solve many problems in areas where this resource is in short supply. We can not overlook the fact that shortage of clean water makes it extremely valuable. In times to come, those with a good and developed water supply system would have nothing to worry about when it comes to survival.  Smart systems should be able to analyze the quality of water and detect leaks, for example. The next step is to regulate the steady flow and inform the consumers about the data gathered.

Moving entire industry to blockchain sounds like a science fiction today. However, just two decades ago, the world did not know anything about smart phones, drones, 3D printers, or social media. Herewith, we have mentioned the functioning of only two resources that we can not live without: water and electricity. Imagine what blockchain can do in the fields of safety, education, health care.

We are looking forward to seeing how things will unfold with Nevada’s Smart City. Meanwhile, we would love to hear your thoughts.

 

Jun 12
cryptocurrency regulation

Cryptocurrency Regulation and G20 Summit

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The G20 Summit is over, and we can now recap on the most important issues, cryptocurrency included, addressed by the global leaders and financial experts who are shaping the societies we live in today. This year’s G20 Summit has been held in Fukuoka, Japan. Apart from the G20 leaders, it hosted some of the most prominent financial experts as representatives of central banks, the IMF, the World Bank, the World Trade Organization and the UN.  They discussed various subjects, but what interests us the most is cryptocurrency regulation.

But, first, we should look back at some of the topics that no one could have overseen such as the ongoing trade war led by the US government and its Eastern counterpart – China. The impact such wars could have globally was another topic discussed at the Summit. The conclusion was that tensions of this kind pose a threat to global economy, and predictions were made that, if prolonged by 2020, the global GDP could be decreased by 0.5 percent or approximately US$455 billion, which would push the world into another economic crisis.

Interestingly, among the threats of the same importance an aging population has been listed.

Special attention was paid to the need to make a serious reform of international tax policies, as they relate to the giants such as Facebook, Amazon and Google. Namely, the proposed regulation should increase the taxes for large multinational companies. Simultaneously, the same regulation should prevent redirecting the sales to so-called European “tax heavens”. Apparently, some of the mentioned companies pay little tax in Europe, as they direct their sales through Ireland and Luxembourg, known as low-tax countries.

The most important news coming from the Summit was addressed by Ms. Christine Lagard, the head of IMF, who stressed the importance of cryptocurrency assets and the need to have a standardized approach when it comes to regulations:

” It is critical to continue the international dialogue on fintech. Integrating different national approaches to crypto-assets, non-bank fintech intermediaries, and the governance of data is crucial.”

Naturally, there are already bodies working on developing what should be considered – standards. As for the members of G20, they recognize the so-called FATF (Financial Action Task Force) as the entity in charge of setting the standards for international handling of crypto assets, as well as for fighting money laundering, respectively. There have also been some suggestions to form the registry of crypto exchanges on the G20 level.

The experts claim that in case decisions of the G20 Summit are actually put into force, cryptocurrencies and its pertaining markets would be on a good way of becoming one of the mainstream ways of handling and transferring funds.

The final opinion expressed at the end of the Summit as the official statement is as follows:

“…cryptocurrencies can deliver significant benefits to the financial system and the broader economy, as crypto-assets do not pose a threat to global financial stability at this point.”

Do you think that cryptocurrencies can and should be controlled globally?

Jun 04
monero crypto cryptocurrency

Monero – The King of Anonymity Among Cryptos

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Monero is most probably the king of anonymity among cryptos. When handling payments online, apart from fast transactions, the highest demand is always for mechanisms that can provide full anonymity. And this is the field where Monero rules – both features combined in one crypto.

It is a secure, private and untraceable currency system. The ability to stay “below the radar” so to speak, is of high importance if you ask crypto enthusiasts. This is also the character that has put this currency in the spotlight of the latest May review of Monero published by Reuters. The  Monero Outreach, a workgroup of the decentralized Monero, defended the Monero feature which intrigues many, in this post.

No One Can Track Your Transactions

Monero gives you the chance to have complete control over the crypto transaction. This means that no one is able to see where your assets go, and you can basically hide all of your tracks. All transactions with this crypto are private. Apart from securing total privacy, this is an important advantage of Monero because the assets you use always appear to be “clean”. Even if at any point in the past, the Monero which is now in your possession, had been used in any kind of shady business, the network will not show the details, and the value of your Monero will not depend on it. Other cryptocurrencies, allowing for transparency while protecting anonymity, are subject to visible previous transactions. This is the point where the distinction is made between so-called “clean” and “tainted” cryptos.

Monero Is Fungible

Many experts accentuate the fact that this crypto is fungible. An odd word, don’t you think so? To tell you the truth, I had to look it up as well to grasp the exact meaning. What it comes down to is the fact that Monero is compatible or convertible, if you wish. Furthermore, since it does not succumb to the concept of “clean” or “tainted”, it is considered to be fungible.

Public and Private Keys

Monero has multiple keys. So far, we have all got acquainted with bitcoin or ether, for example, that have one public and one private key. Again, “multiple keys” is the feature which should secure that the senders’ and users’ identities are kept well hidden. The public view key, as the word says, is used for generating public address. The private view key is used by the receiver for scanning the blockchain and finding the funds sent to him.

Signatures and Full Protection of Identity and Transactions

In order to fully protect your privacy of a sender, Monero has “Ring Signatures”. There is an interesting explanation of this term which I came across and it says that when you are sending the check you need to sign it and everyone will recognize your signature, because the handwriting is unique for each person. However, if you were to combine your own handwriting with a few more people, you would create a unique, but unrecognizable signature. This is what Ring Signatures do. They make a unique reference to the sender without any lead toward his identity.

Monero developers also pride themselves with what they refer to as “stealth addresses”. This means that the transactions between addresses are not traceable, i.e. only the sender of funds would know who the receiver is.  Furthermore, the transaction amount can also be fully hidden, depending on your preferred settings.

Looking forward to hearing your experience with Monero.

Editor’s Note: Check out all you need to know about Ethereum & ETH, or Dogecoin – crypto with most passionate fans.

May 28
BitPay crypto

How Does BitPay Fit Into Crypto Tax Law

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“…In this world nothing can be said to be certain, except death and taxes”. Throughout time, there have been many references to this phrase by Benjamin Franklin. And it still stands today. However, we are witnessing a tremendous moment in time, when boundaries are pushed, new currencies evolve and the law is trying to keep up with reality. So, what is the story about cryptos and taxes, and how does BitPay fit into this?

Most people are aware of the importance of filing taxes, and they do it regularly. With cryptos, things got a bit challenging. The IRS has reportedly received complaints from its citizens and officials asking for clarifications regarding the way cryptocurrencies are treated, and claiming that they are in constant risk of being marked as individuals who try to evade taxes, all due to the volatile nature of the existing law.

At the moment, the law states that a taxpayer should file each transaction executed when using a cryptocurrency because each transaction is considered to be a taxable event. At the same time, in the US, cryptocurrencies are also taxed under capital gains law that applies to property investments. The current regulations issued back in 2014 state that cryptocurrencies should be treated as property, meaning that they fall under statutes that apply to property transactions. However, the IRS appears to be reconsidering the nature of cryptos, as the IRS Commissioner has reportedly claimed that the situation has changed since 2014 and that cryptos are developing both as “a medium of exchange and as an investment vehicle”. Now, I am not an expert, but this sounds to me like the lawmakers are about to officially characterize cryptos as currencies.  Furthermore, the IRS has announced the issuing of clearer guidelines on how to treat cryptos and how to properly file taxes.

On another note, what we found a bit more interesting, and equally important is the news coming from BitPay. It is about the option given to income tax payers, allowing them to receive the federal and state refunds in bitcoin. This very fact could be seen as getting a foot in the door on a way to officially accepting cryptos as currencies, instead of just property. Blockchain payment processor, BitPay has reportedly announced that the firm had partnered with Refundo – which is a US based taxation services provider, in order to secure this option for tax payers. The users of Refundo will be able to receive either a fraction, or entire tax refund in BTC, using its CoinRT. All they need to do is open an account, following instructions and to provide the required background info and a bitcoin wallet address. Then, when the IRS (or state) deposits the refund, BitPay will process it and transfer the bitcoin to the taxpayer’s wallet. The CoinRT service is said to cost app. $34.95, regardless of the amount which is being transferred. Above all, this should be the only fee paid by the user.

As a quick reminder, BitPay was founded in 2011, and this is not the first time they are dealing with cryptos. Previously, they co-operated with Florida county tax collector, as well as with Ohio State, when Ohio needed some input into accepting taxes in cryptocurrency. They claim to have processed over $1 billion worth of transactions last year.

Do you think that the tax law would change significantly in favor of crypto lovers?