Crypto-digest 05.02 — Up 33%: Bitcoin’s price just had its best month of 2018; Google co-founder highlights crypto mining impact,; Not just Bitcoin: OpenBazaar is gearing up for a radical redesign; Ripple’s enterprise blockchain network adds a new bank; Ripple put on defensive at UK parliament blockchain hearing; Crypto data site CoinMarketCap releases iOS mobile app.
Up 33%: Bitcoin’s price just had its best month of 2018
Bitcoin’s price rose 33 percent against the U.S. dollar in April, making it the best month of 2018 for the world’s largest cryptocurrency.
Data from CoinDesk’s Bitcoin Price Index (BPI) shows that May began with bitcoin’s price at the $9,244.32 mark – a 33 percent jump from its April 1 start of $6,926.02. This marks the greatest rise in bitcoin’s price this year, and one of only two months where it rose at all within the period.
Bitcoin’s price fell overall in January and March, and only rose 1.4 percent in February, according to BPI data.
Indeed, bitcoin fell by nearly a third in each of the negative months, dropping from $13,860 on January 1 to $10,166 on February 1, and even more drastically – from $10,309 to just below $7,000 – in March. While bitcoin has rallied this past month, it has yet to recover to the $10,000 mark, which it last fell below in mid-March.
That being said, these numbers hide the fact that bitcoin actually rose to past $17,000 in January before falling by nearly half to its February 1 level.
Similarly, bitcoin reached a low below $6,000 before recovering, as shown by the BPI. In other words, while it may have begun spending periods of time trading sideways, it remains volatile year-to-date.
Notably, bitcoin’s transaction volume jumped by 93 percent month-over-month, while the number of off-chain transactions through exchanges jumped by a similar 95 percent. However, fees saw a similar jump, rising 90 percent in April, according to data collected by CoinDesk.
Bitcoin derivatives had a similarly positive month. Both the CBOE and CME saw their futures contracts trading volume spike this month, with CBOE in particular seeing more than 18,000 contracts traded in a single day on April 25, as previously reported.
Similarly, CME saw more than 11,000 contracts traded that day, roughly double its daily average.
Google co-founder highlights crypto mining impact
In a letter to investors, Google co-founder Sergey Brin said that demand for the powerful computers used to mine ether and other cryptocurrencies has contributed to a “boom of computing.”
Brin wrote Saturday that several factors have led to a surge in computing power that has seen search giant Google’s own processors speed up by a factor of 200,000 over a period of 20 years. The first factor is the “steady hum of Moore’s Law,” referring to the observation that computing power per square inch of a chip tends to double every other year.
The second factor is increased demand for processing heft, partly from gamers and their graphics-hungry rigs but also “surprisingly, from the GPU-friendly proof-of-work algorithms found in some of today’s leading cryptocurrencies, such as Ethereum.”
GPUs, or graphics processing units, are used to “mine” ether: to update the cryptocurrency’s blockchain through a process known as proof of work, which involves rapidly crunching through cryptographic functions. (Ethereum miners may not use GPUs for much longer, however, given that a specialized piece of hardware has been developed by Bitmain)
Brin did not feel either of these factors was the biggest contributor to the computing “boom,” however. That factor, he wrote, is machine learning, a data-intensive technique used to develop artificial intelligence systems that can drive cars, recognize faces or translate texts without human input.
Google has explored uses for blockchain technology, the cryptographic structures that underpin cryptocurrencies such as bitcoin and ethereum, but has made very little mention of cryptocurrencies themselves – except to ban browser extensions for mining and ads for initial coin offerings.
Not just Bitcoin: OpenBazaar is gearing up for a radical redesign
OpenBazaar is gearing up for an overhaul.
Since startup OB1 launched in 2014 to develop a “bitcoin-powered” online market, the founders have focused almost exclusively on the world’s largest cryptocurrency. But with the scaling debate still raging in some ways, OB1 co-founder Washington Sanchez took to Twitter recently to vent his frustrations about that course of action.
“I personally wasted so much time in the bitcoin scaling civil war that I could have used designing [and] building dapps (decentralized applications) and opening up OpenBazaar to multiple currencies,” Sanchez wrote. “Instead, we had to wait for fees in bitcoin to cripple any consumer usage before we woke up.”
Strong words – especially in light of a number of developers working diligently on layer-two technologies, such as lightning network, which push transactions off-chain in an effort to scale for an ever-growing user base.
Still, it’s also become clear to OB1 that its user base not only wants to be able to use bitcoin, it wants to use other crypto assets on OpenBazaar’s peer-to-peer (P2P) network.
While bitcoin remains the most widely used – with 11,000 listings of items to purchase with the cryptocurrency – other coins are making a mark for OpenBazaar’s 5,000 weekly users. There are around 1,122 listings for items to buy with bitcoin cash, the cryptocurrency that forked off bitcoin in August 2017, plus a few dozen products being sold for privacy-oriented cryptocurrency zcash.
And it seems today, the founders of OB1 are ready to open their minds and platform to a whole new world of cryptocurrencies.
Speaking to that new outlook, OB1 co-founder Brian Hoffman told CoinDesk the vision for OpenBazaar is to be “the easiest and fastest way to start a business that accepts cryptocurrency and to buy or sell anything you want with cryptocurrency.”
And on Twitter, Sanchez seconded that sentiment, saying, “OpenBazaar is supposed to be a free and open protocol for trade using cryptocurrency, a way for currencies and tokens to gain meaningful economic utility to acquire goods and service, and an entry point for people to earn and onboard.”
“This vision cannot be limited to a single coin.”
But that shouldn’t exactly come as a surprise. The ambitious redesign and the move to a multi-cryptocurrency mission was at least hinted at previously.
For one, Hoffman announced plans to launch OpenBazaar Token (OBT) during crypto conference Token Summit in December, and the team laid out some of its other plans in January after raising $5 million (bringing its total to $10.5 million) from investors like China-based crypto mining hardware giant Bitmain.
During that time, OB1 mentioned a web and mobile app and a service to allow users to trade cryptocurrencies with each other.
But that goal isn’t just about making a pretty penny monetizing its services (currently it only makes money off affiliate links), but about facilitating broader engagement to encourage the types of communities seen on social media.
“We’re trying to drive more adoption as a network, as a protocol,” Hoffman said. “It’s kind of a longer-term play.”
A crypto Pinterest
And the start of that play, according to Hoffman, will happen later this month with the debut of a new section for swapping several types of cryptocurrencies, including litecoin and zcash.
“Ultimately, the platform can be used with any cryptocurrency that supports a few key things like multi-signature [wallets] and if it can be used as a transactional currency,” Hoffman told CoinDesk.
Albeit, OpenBazaar won’t be able to support every coin right away. Currently, its aim is to facilitate P2P transactions (without trading fees) among the top-ranking cryptocurrencies.
On top of that, once OpenBazaar’a native crypto token OBT launches, users will be able to earn and use those.
The launch of that isn’t slated till after Q4 2018, though, since the company must build the features necessary for earning. Those features take from several social media giants’ playbooks, allowing users to set up and post statuses to feeds similar to Twitter and Facebook and create curation boards a la Pinterest.
Creating sought-out curation boards or having popular posts will earn you OBT. In this way, OpenBazaar is “using the token to incentivize activity on the platform,” Hoffman said, adding:
“You don’t need the token to operate OpenBazaar, necessarily, but you can earn crypto by helping make the network better.”
After OBT launches, OpenBazaar plans on taking its multi-currency outlook one step further next year, offering support for ethereum and ethereum tokens, even crypto-collectibles such as CryptoKitties and other digital pets.
“One of my biggest regrets is not realising the awesomeness of ethereum and other projects and dapps, because I was blinded by my bitcoin maximalism,” Sanchez tweeted.
And with this, the team hopes to attract more people across a variety of cryptocurrency communities.
“There’s no reason to block those people out,” Hoffman said.
Beyond the node
Yet, what remains one of the startup’s highest barriers to mass adoption is the complexity of accessing the market.
Currently, it requires users run a full node and interact only through a clunky desktop app.
As such, OpenBazaar is looking to revamp its desktop website and launch mobile apps (one from iOS and one for Android), which will start being beta-tested in June.
At first, these interfaces will feature read-only versions of the desktop app where newbies can merely browse through listings and profiles, but later, OpenBazaar will create a browser-ready site like any other site (no full node needed). And then by the end of 2018, those interfaces will allow for purchases too.
And on top of putting a significant amount of its developer power towards making the marketplace more accessible and open, OpenBazaar also plans to make ideation and development more accessible to those outside its ranks.
To that end, OB1 co-founder Sam Patterson will soon split off to launch a separate non-profit, The OpenBazaar Foundation, which will focus on giving the community a conduit for influencing what features make it into OpenBazaar’s open-source protocol.
And that should give the hundreds of people interested in attending the company’s developer meetings (500 people RSVP’ed for the next one so far) a better way to connect.
“We’ve spent the past few years making sure the protocol is stable. Now building apps on top is a much easier process.”
Ripple’s enterprise blockchain network adds a new bank
Ripple’s global network of banks and payment providers has a new member.
Announced Monday, BankDhofar, an Oman-based financial investment management company, has joined RippleNet, a move the bank says enables it to provide global cross-border payments using Ripple’s blockchain technology, a press release states.
As such, the move is the latest that finds BankDhofar among an early set of blockchain movers in the Middle East. Earlier this year, BankDhofar joined Bankchain, a consortium of over 27 banks that was launched in February 2017 to explore blockchain solutions for the banking sector.
Dr. Tariq Taha, chief information officer at BankDhofar, commented:
“With this, we can provide instant, frictionless and secure cross border money transfers within seconds, with end-to-end visibility over the journey of the payment.”
BankDhofar notably did not say which Ripple products it is seeking to use to tap those benefits, nor if it was open to using XRP Ledger, the open-source codebase that utilizes the XRP cryptocurrency.
Still, the recent entrance into RippleNet blockchain network is a part of BankDhofar’s larger effort “Together 2020,” which aims in positioning the bank in the lead in the Gulf region.
“This initiative is part of BankDhofar’s continuous transformation plan, which is putting digital technology and innovation at the core of its strategy to improve the experience of its customers,” the release concluded.
Ripple’s enterprise blockchain network adds a new bank
Skepticism dominated a Tuesday hearing on cryptocurrencies and blockchain at the U.K. parliament, but it was not the members of parliament (MPs) who set the negative tone.
Rather, it was interbank payments startup Ripple’s XRP cryptocurrency and blockchain platforms that came under fire as Martin Walker, director of the non-profit Centre for Evidence Based Management and a former product developer at blockchain consortium R3, claimed that the technologies are unlikely to solve inefficiencies in the financial sector, specifically criticizing Ripple’s current products.
Defending Ripple’s record was director of regulatory relations Ryan Zagone. Dr. Grammateia Kotsialou, a postdoctoral researcher at King’s College London and Chris Taylor, chief operating officer at asset tracking blockchain startup Everledger, filled out the panel, which answered questions from the British Parliament’s Treasury Select Committee.
During his testimony, Zagone cited the ability to track money transfers as a core benefit of the company’s technology. However, Walker argued that the company’s model offers little more than the existing SWIFT messaging system, saying “the hard thing about tracking payments is actually getting the people involved in the payments to actually upload the status.”
“So simply having a blockchain doesn’t actually get people to update the status of where the payment is,” he continued.
Likewise, he criticized Ripple pilot projects that propose to use XRP as a means of bridging two currencies in an international transaction – a role that the U.S. dollar commonly occupies.
“You have the concept of a crossing currency to deal with that scenario where there’s a lack of liquidity,” Walker explained, remarking further:
“You need someone to provide the liquidity to be able to change into and out of Ripple. And holding Ripple, a currency which has seen its price drop 80 percent and then back up 100 percent in the course of the last two months is just not credible. So, putting cryptocurrencies into the financial sector is a huge source of risk.”
The ministers at the hearing also turned their attention to Ripple, specifically expressing confusion regarding XRP’s relationship to Ripple Labs.
MP Stewart Hosie commented that “if people buy XRP, a financial asset from Ripple Laboratories, it doesn’t entitle them to an ownership stake, there’s no right to be converted back into conventional currencies, and it doesn’t pay any return. It also seemingly has no purpose.”
However, Zagone pushed back against this statement, saying “that’s a common misperception.”
He told the panel:
“XRP is open source and it was not created by our company, so that existed as an open source technology. We created a company that was interested in modernizing payments and then began using that open-source tech to do so … We didn’t create XRP … What we do have is we do own a significant amount of XRP, it was gifted to us by some of the open-source developers that created it. But there’s not a direct connection between Ripple the company and XRP.”
Asked whether XRP was designed to avoid regulations, Zagone reiterated his statements from earlier in the hearing that Ripple only sells XRP to institutional investors and not retail consumers, and likewise that the company merely makes use of XRP, but is not directly connected to it.
With the conclusion of the hearing, Walker advised the Committee to think critically about blockchain technology and cryptocurrencies, concluding
“I would just urge the committee that we do not repeat the mistakes that have been made over and again of getting blinded by the word innovation, particularly relating to financial products.”
The full hearing is now available online.
UPDATE: This article has been updated to indicate Walker was previously employed by R3.
Crypto data site CoinMarketCap releases iOS mobile app
CoinMarketCap, the popular cryptocurrency market data site, has released its first mobile app.
The Tuesday release – which is currently only available for iOS users – comes as the site marks its fifth anniversary since launching in 2013. CoinMarketCap lists prices for hundreds of coins and tokens as well as trading volume data for exchanges. The site has become one of the most-visited in the world, ranking 174th in Alexa’s global rankings.
According to a post by the company published alongside the app’s release, CoinmarketCap has received 60 million unique visits thus far in 2018.
“The space has really evolved in the past five years and so have we,” CEO Brandon Chez said in a statement. “So we thought for this anniversary, it would be nice to do something big for our users.”
CoinMarketCap’s app is available from the iTunes Store free of charge and includes ads. It has earned 12 ratings at the time of writing, all of them five stars. The company also unveiled a new logo Tuesday.
Amidst growing interest in digital assets, CoinMarketCap faces increasing competition. Thomson Reuters, an established data provider, has added bitcoin, ether, litecoin, bitcoin cash and Ripple’s XRP to its data offerings. The company is also offering indices based on data from CryptoCompare, CoinMarketCap’s less-trafficked rival.