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What UK Bitcoin Investors Should Know as Tax Deadline Approaches

January 16, 2019 |

The deadline for submitting tax returns in the UK is Jan. 31, 2019. If you hold investments in bitcoin or any other cryptocurrency it is important to be aware you may owe corporation tax, income tax, or capital gains tax depending on your activities. The U.K.’s HM Revenue and Customs (HMRC) has shared its most recent guidelines.

Also read: Cryptocurrency and Taxes: How to Use 2018’s Losses to Your Advantage

Get Ready, Set, File

What UK Bitcoin Investors Should Know as Tax Deadline ApproachesThe last 18 months have been quite a rollercoaster ride for cryptocurrency investors. There could be another dip ahead as the taxman will want his share of any profits made during the past tax year. Recently, there have been numerous reports emerging of tax authorities clamping down and going after cryptocurrency traders.  

In the U.K., self-assessment is a system the HMRC uses to collect tax. So if you’re a sole trader or in a business partnership based in Britain and have made any gains investing in cryptocurrencies or have been sold an investment giving you exposure to digital assets, you may owe tax. Failure to report crypto gains could amount to tax evasion.

HMRC’s Guidelines on Crypto

Calculating taxes can be a complex and stressful process.  Over the last couple of years, there has been a lack of clarity when it comes to bitcoin taxation. The latest taxation guidelines around cryptocurrencies from the HMRC aim to simplify the process of reporting taxable crypto assets.

A spokesperson from HMRC explained: “Where an asset including bitcoin is held as an investment as opposed to being working capital in a trading activity – the presumption is that any profit or gain on its disposal will be charged to capital gains tax.

According to HMRC, a calculation is made for each “disposal” or transaction to establish where the disposal gave rise to a gain or a loss. At the end of the tax year, which runs from April 5, 2017 to April 5, 2018, the taxpayer must add together all of their chargeable gains and then subtract any in-year allowable losses. Any losses will be looked at on a case-by-case basis. 

According to HMRC:

Whether any profit or gain is chargeable or any loss is allowable will be looked at on a case-by-case basis taking into account the specific facts. Each case will be considered on the basis of its own individual facts and circumstances.

Keep Records of Every Single Transaction

What UK Bitcoin Investors Should Know as Tax Deadline ApproachesHMRC has explained that “if the overall result is a gain then capital gains tax will be due on this, after deducting any allowable losses brought forward from previous tax years and deduction of the annual exempt amount. If the overall result is an allowable loss then this can be carried forward to future tax years to set against chargeable gains.”

Another issue which arises is what happens if an individual has sold from one cryptocurrency to another, say from BCH to ETH. Would they only be taxed once they convert this crypto into pounds?

A HMRC spokesperson explained: “The tax treatment would depend on the particular circumstances, but where capital gains tax is in point the chargeable gain or allowable loss will arise when a cryptocurrency is sold or otherwise disposed of (example by exchange) for money or money’s worth … swapping bitcoin for ethereum or indeed sterling will involve a disposal of the bitcoin and any gain or loss on the bitcoin will accrue.”

HMRC has published a guide aimed at bitcoin miners, traders, exchanges, payment processors and service providers, to help shed light on the crypto taxation process.

Disclaimer: This editorial is intended for informational purposes only. Bitcoin.com and the author are not experts on taxes and cannot be held responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by following the information in this article. 

What do you think of HMRC’s guidelines as detailed above? Let us know in the comments section below.


Images courtesy of Shutterstock.


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

The post What UK Bitcoin Investors Should Know as Tax Deadline Approaches appeared first on Bitcoin News.

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Clickbait Media Uses Bitcoin and Russia to Pump Headlines Again

January 16, 2019 |

Clickbaiting Telegraph Uses Bitcoin and Russia to Pump Headlines Again

In the past week or so, a number of publications, including cryptocurrency websites, but also “reputable” mainstream outlets, have given stage to a “Kremlin economist” with a bold prediction – Russia will invest billions in bitcoin to tackle U.S. sanctions, possibly triggering a new bull run as early as next month. The claim was quoted in multiple reports, although never double-checked or substantiated.

Also read: Russia Not Ready for the Petro, Proposes Plan to Aid Venezuela Without It

Moscow Said to Dump Billions Into Bitcoin

The statements came from Vladislav Ginko, a lecturer at the Russian Presidential Academy of National Economy and Public Administration (Ranepa). Last week he told the Australian online edition Micky that new U.S. sanctions will push Moscow to diversify its cash reserves and there are limited options by which they can do so. One of them is to replace part of the $ 466 billion saved by the Central Bank of Russia with cryptocurrency. He insisted that Russia’s elite is also being forced to dump U.S. assets and currency and “invest hugely into bitcoins.” The expert economist stated categorically:

U.S. sanctions may be mitigated only through Bitcoin use.

Ginko further suggested that the first wave of significant Russian government investment into bitcoin, “worth billions of dollars,” could come within the next few weeks. “I believe that Russia will start diversifying its reserves with bitcoin in February, when the U.S. Congress will introduce new sanctions,” he said. The economist also shared his opinion that the Russian government is not against cryptocurrencies and noted that President Putin has referred to fintech as a key driver of the country’s economy.

Clickbait Media Uses Bitcoin and Russia to Pump Headlines Again

Toward the end of the interview, Vladislav Ginko admitted that much of his work recently has been focused on persuading Russian officials that bitcoin is the best way to alleviate the effects of tough U.S. sanctions and prove to various stakeholders of Russian society the need for investing central bank money into the “heavily oversold bitcoin.”

Some ‘Exclusive’ Reports

The report was promoted by the Australian media outlet as exclusive, although Ginko has been actively spreading his views and forecasts on social media and in conversations with many journalists. A number of other crypto and mainstream media outlets, including Fortune, have quoted Micky’s report. However, Britain’s Daily Telegraph newspaper has published its own article, posting additional information – again, unconfirmed by an official government source from Russia.

The Russian expert is quoted as saying that Moscow is ready to invest as much as $ 10 billion in the world’s most popular cryptocurrency as part of its de-dollarization efforts and in order to prevent interruptions of U.S. dollar payments for Russian oil and gas. Another unverified claim by Ginko, which has been quoted by The Telegraph, is that the cryptocurrency industry now accounts for 8 percent of Russia’s GDP.

In the meantime, Micky has come out with another article on the same topic, claiming to have obtained documents from Australian crypto OTC brokerage Lupo Toro reportedly showing “large and unusual increase in the volume of OTC bitcoin purchases placed by Russian nationals.” The so-called “Moscow Files” have been published under a title starting with “The Putin Pump?”

Clickbaiting With Bitcoin

Crypto prices did not see much pumping during a bearish 2018, but this didn’t diminish the spate of hyperbole-laden headlines. The cryptocurrency is a very convenient target for alarmists, attention-seekers, and clickbaiters. Bitcoin does not have a CEO and can’t complain about fake news, so the mainstream media simply doesn’t care about the actual facts. In this particular example, Russia’s Billions, Shift to Bitcoin, Ditching the Dollar, and Putin’s Pump have been an irresistible choice of words for many online editors. A reply to Barry Silbert’s tweet linking The Telegraph’s article sums it all up very well:

This is what happens when journalism becomes shitposting. ANY PROOFS? What’s wrong with reporters these days?

Russia does seek ways to decrease its dependency on the U.S. dollar. It has increased its holdings of the euro, Chinese yuan, Japanese yen, and has discussed the introduction of a common digital currency within the Eurasian Economic Union (EAEU) and BRICS. But according to one real government official, Moscow is not looking at bitcoin. Elina Sidorenko, chair of the crypto working group in Russia’s parliament, recently noted that “there’s not a bit of common sense” in Ginko’s statements.

“The Russian Federation, like any other country in the world, is simply not ready today to somehow combine its traditional financial system with cryptocurrencies … The implementation of this idea in the next at least 30 years is unlikely to be possible,” she commented. Sidorenko believes the only way to use digital assets at the state level would be to create an international cryptocurrency as a unit of account between countries. A convertible “cryptoruble” has its supporters in the Moscow corridors of power as well – it fits in Russia’s “Sovereign Democracy” concept better than any decentralized crypto.

Clickbait Media Uses Bitcoin and Russia to Pump Headlines Again

Another telling statement recently came from the chairman of the parliamentary Financial Markets Committee, Anatoly Aksakov. No one is going to ban Bitcoin in Russia, he said. His main concern was that if crypto holders are pushed against the wall by the state, they will revert back to investing in the U.S. dollar. The legislation on digital financial assets the State Duma is about to adopt on second reading in February will simply not mention cryptocurrency at all – a decision that reflects Putin’s own admission that “cryptocurrency is something that goes beyond national borders.”

It seems that anyone who thinks Russia will fully embrace Bitcoin doesn’t know Russia very well, and anyone who thinks Russia will completely ban Bitcoin doesn’t know Russia enough. In the end, Russia may decide to treat Bitcoin like Snowden: we didn’t want you here but since you’ve come, you can stay and do your thing. And of course, we don’t want you to harm the interests of “our American partners.”

‘Misunderestimating’ Russia

Misunderstanding, underestimating, and most often misinterpreting Russia remains a common mistake, as the following video humorously conveys:

Sadly, the case of “Kremlin economist” Vladislav Ginko won’t be the last time that mainstream media is badly wrong about Russia – or about Bitcoin.

Do you think Russia will invest in bitcoin, and if so, do you expect Moscow to officially admit it? Share your thoughts on the subject in the comments section below.


Images courtesy of Shutterstock.


OP-ed disclaimer: This is an Op-ed article. The opinions expressed in this article are the author’s own. Bitcoin.com does not endorse nor support views, opinions or conclusions drawn in this post. Bitcoin.com is not responsible for or liable for any content, accuracy or quality within the Op-ed article. Readers should do their own due diligence before taking any actions related to the content. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any information in this Op-ed article.

The post Clickbait Media Uses Bitcoin and Russia to Pump Headlines Again appeared first on Bitcoin News.

Bitcoin News

Denmark’s Tax Agency to Collect Information About Bitcoin Traders

January 15, 2019 |

Denmark’s Tax Agency to Collect Information About Bitcoin Traders

Danish tax authorities will soon be going after cryptocurrency traders in the country and beyond. The plan is to collect data from local bitcoin exchanges in order to verify if citizens who have traded digital assets have paid the right taxes. Information about foreign citizens and entities will be shared with other countries.   

Also read: 5 Crypto Exchanges Have Been Licensed in Gibraltar Since Regulation

Tax Agency Authorized to Gather Data From Three Danish Exchanges

Skattestyrelsen, the Danish Tax Agency, announced it has been authorized by the country’s Tax Council, Skatterådet, to obtain information about cryptocurrency trade conducted on three Danish exchanges between Jan. 1, 2016 and Dec. 31, 2018. The authority noted that it’s the first time it will access this kind of data. Karin Bergen, the agency’s director responsible for personal income tax collection, said:

With the permission of the Danish Tax Council, we will for the first time gain access to the trades made via Danish exchanges. This gives us new opportunities with respect to exerting control in the field.

The three platforms must now provide information about all purchases and sales of cryptocurrency made by their customers during the two-year period. They will be obliged to include identification information such as names, addresses, and CPR numbers, the personal ID numbers issued by the Danish Civil Registration System.

Denmark’s Tax Agency to Collect Information About Bitcoin Traders

The decision to permit the Danish Tax Agency to collect the data was taken at the last meeting of the Tax Council in December. It followed news that the agency has been informed by Finland’s tax authorities about Danish citizens trading cryptocurrencies on a Finnish bitcoin exchange. The Danish tax body also plans to share information about crypto transactions made by foreign citizens and companies in Denmark with tax authorities in the respective countries.

Big Market That Needs to Be Looked Into

Skattestyrelsen is now contacting the Danish crypto exchanges in order to establish a procedure for the disclosure of the information. Once the data is received, the Tax Agency will ensure that citizens who have traded cryptocurrency have paid their taxes. Bergen further commented:

Without going too far, I think one can say this is a big market that we need to look into. When we recently received information from the Finnish bitcoin exchange, it gave us a small portion of the larger picture, which we now have the opportunity to uncover even more of. However, it’s still too early to tell how many traders are out there and how much money has been traded.

The Danish tax authority will adjust the tax base for each trader before the summer. Every case will be reviewed and treated individually to determine whether a cryptocurrency trade is part of the taxable income.

Denmark’s Tax Agency to Collect Information About Bitcoin Traders

In December, the Tax Agency was tipped off by Finnish tax authorities about around 2,700 Danes trading on a cryptocurrency exchange based in Finland. According to the official estimate, the Danish citizens have traded coins worth more than 100 million krones (~$ 15 million) between 2015 and 2017.

Last month, the authority quoted a survey conducted by the National Tax Board which found that 450,000 Danes are considering shopping with cryptocurrency. The agency launched a campaign to inform taxpayers about their obligations but also the deductions they are entitled to.

What do you think about Danish tax authorities collecting information from crypto exchanges? Share your thoughts on the subject of crypto taxation in the comments section below.


Images courtesy of Shutterstock.


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

The post Denmark’s Tax Agency to Collect Information About Bitcoin Traders appeared first on Bitcoin News.

Bitcoin News

How to Generate a Bitcoin Address With Your Own Name

January 14, 2019 |

You don’t have to be vain to want a vanity address. A bitcoin vanity address is the crypto equivalent of a personalized license plate, with a portion of its 26-35 alphanumeric characters closely mirroring the name of the wallet’s owner. For fundraising, collecting tips or soliciting donations, having a bitcoin address that’s synonymous with its owner can be advantageous, despite the privacy trade-off this entails.

Also read: Newspaper Ad Seeks Donations for Bitcoin Baby’s College Fund

Why You Might Want a Vanity Address

If you’ve been involved with Bitcoin for a while, you’ve likely encountered a vanity address at some stage. While perusing a blockchain explorer and inspecting the outputs for a particular transaction, for example, you may have spotted an address whose combination of characters looks to be more than just a coincidence. In a report on the U.S. government “blacklisting” bitcoin addresses, for example, news.Bitcoin.com noted some of the addresses that had been sending funds to one Iranian-controlled BTC account:

How to Generate a Bitcoin Vanity Address

A vanity address was also used by the couple who placed an ad in The Times seeking to raise college funds for their “bitcoin baby.” Week-old Izabella’s bitcoin address starts with the characters “1ZAB5Xe.” For anyone wishing to follow suit, there are a number of third-party solutions that will help create a personalized address including Vanitygen and, for BCH users, Vanitygen Cash. Caution should be exercised when using third party code, however, particularly with services whose Github repository hasn’t been updated in years.

How Vanity Addresses Are Created

Services such as Vanitygen are designed to search for exact prefixes or expression matches. The search initiated for a matching public key is probabilistic, and thus the longer the name desired, the longer it will take your computer to hash an address that meets the criteria. Vanitygen first appeared in 2011 in a Bitcointalk forum thread, and thus is almost as old as Bitcoin itself.

How to Generate a Bitcoin Vanity Address

For anyone interested in playing about with vanity address creation, there are various internet forums and threads dedicated to the topic. It’s possible, for example, to create a bitcoin address containing only numbers and uppercase characters. If you lack the computational power to generate your own vanity address, a service such as Vanity Pool will do the honors, with the fee starting at 0.01 BTC for 1-6 characters, but rising significantly after that due to the increased processing power required. As the Vanitygen wiki page explains, it would take approximately a week to compute a vanity address that began with the characters “1Bitcoin” whereas an address starting with the characters “1BitcoinEat” would take an estimated 3,500 years.

How to Generate a Bitcoin Vanity Address
Vante.me’s key generation service. Caution should be observed when using third party vanity address generators.

From a security perspective, the safest way to create a vanity address is to do it yourself on your own computer, though this may not be possible if you’re seeking a larger pattern that’s computationally intensive. The next safest option is probably to use a service such as Vante.me, which uses split-key address generation. The biggest drawback to creating and using a vanity address, of course, is that it’s a poor practice from a privacy perspective. If you do choose to use one, it’s wise to periodically send funds to a separate address that you control, for privacy and security reasons. Despite their drawbacks, a vanity address can prove a nice touch for anyone willing to publicize their bitcoin address and be permanently associated with it.

What are your thoughts on vanity addresses? Let us know in the comments section below.


Images courtesy of Shutterstock.


Disclaimer: Bitcoin.com does not endorse nor support these products/services.

Readers should do their own due diligence before taking any actions related to the mentioned companies or any of their affiliates or services. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

The post How to Generate a Bitcoin Address With Your Own Name appeared first on Bitcoin News.

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Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records

January 13, 2019 |

Latin American P2P Markets Defy Global Trend to Smash Volume Records

The Latin American peer-to-peer (P2P) cryptocurrency markets have a seen a significant spike heading into 2019, with the Colombian, Peruvian, and Venezuelan Localbitcoins markets posting record volume when measuring in both fiat and BTC. The Argentinian, Dominican, and Mexican markets also posted record volume for P2P trade in recent weeks.

Also Read: 9 Cryptocurrency Firms Sue Washington State Utility Over 50 Percent Rate Hike

Latin American P2P Markets Witness Record Trade Volume

Despite a steady decline in global Localbitcoins volume during recent weeks when measuring in fiat currency, several Latin America P2P markets consistently posted record trade activity heading into the new year.

The months of November and December 2018 saw the Colombian Localbitcoins post consecutive records for weekly trade activity.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins COP/BTC Volume – COP

The increased volume appears to have peaked during the end of December, with the current record of 759 BTC or 8.40 billion Colombian Pesos (COP) (approximately $ 2.66 million) worth of cryptocurrency changing hands during the week of Dec. 22, 2018.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins COP/BTC Volume – BTC

Since then, volume has significantly receded, with 346 BTC or approximately 4.26 billion COP (roughly $ 1.35 million) worth of bitcoin core trading hands during the week of Jan. 5th, 2019 – a drop in volume of between 50 and 55 percent over the course of just two weeks.

Peruvian and Argentinian Trade Activity Drops 50% Since December Surge

When measuring in fiat currency, the Peruvian Localbitcoins markets posted six consecutive records for weekly trade volume from the week of Nov. 14, 2018, until Dec. 29, 2018.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins PEN/BTC Volume – PEN

Peruvian P2P trade saw a new record posted for both fiat and cryptocurrency volume with 252 BTC or 3.46 million Peruvian Sol (PEN) (nearly $ 1.04 million) worth of trade during the final week of 2018. Since posting the current record, P2P trade between PEN and BTC has dropped by roughly 25 percent to 190 BTC or 2.59 million PEN (approximately $ 776,000).

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins PEN/BTC Volume – BTC

When measuring in fiat currency, the Argentinian Localbitcoins markets posted record volume of nearly 9.45 million Argentine Pesos (ARS) (roughly $ 256,000) during the week of Dec. 8, 2018. The same week saw 65 BTC traded on the platform, the most to change hands since April 2017.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins ARS/BTC Volume – ARS

Despite the significant burst in trade activity, Argentinian P2P trade appears to have since dropped off by between 40 and 50 percent in roughly one month, with 30 BTC or 5.64 million ARS (approximately $ 153,000) worth of crypto trading on Localbitcoins during the week of Jan. 5, 2019.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins ARS/BTC Volume – BTC

Dominican and Mexican P2P Trade Spikes During Week of Dec. 22, 2018

P2P trade between the Dominican Peso (DOP) and BTC broke records twice during December 2018, with volume more than doubling during the week of Dec. 22 to post the current record of 47 BTC worth of weekly trade when measuring in cryptocurrency.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins DOP/BTC Volume – BTC

When measuring in fiat, the 9.2 million DOP (roughly $ 182,000) worth of BTC traded during the same week comprises the third strongest weekly trade activity on record, and the strongest volume posted since the week of Jan. 13, 2018.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins DOP/BTC Volume – DOP

Mexico also saw a surge in P2P trade during the week of Dec. 22, 2018, with 9.34 million Mexican Pesos (MXN) (roughly $ 488,000), or 115 BTC, changing hands in a single week – the second strongest on record when measuring in MXN.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins MXN/BTC Volume – MXN

Venezuelan Cryptocurrency Trade Continues to Surge

Seven weeks during November and December of last year saw record volume posted for Venezuelan Locabitcoins trade when measuring BTC, six of which also comprised then-record volume when measuring in Venezuelan Bolivars (VES).

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins VES/BTC Volume – BTC

After posting a new record of 1,974 BTC or 5.29 billion VES (nearly $ 6.66 million) worth of trade during the week of Dec. 22, the Venezuelan Localbitcoins markets have since failed to post a new record for two consecutive weeks when measuring in cryptocurrency for the first time since September 2018.

Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records
Localbitcoins VES/BTC Volume – VES

Why do you think Latin American trade activity flourished in spite of declining global volume during the final months of 2018? Share your thoughts in the comments section below!


Images courtesy of Shutterstock, Coin.dance


At Bitcoin.com there’s a bunch of free helpful services. For instance, have you seen our Tools page? You can even lookup the exchange rate for a transaction in the past. Or calculate the value of your current holdings. Or create a paper wallet. And much more.

The post Latin American P2P Bitcoin Markets Defy Global Trend to Set New Records appeared first on Bitcoin News.

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No, IBM’s Quantum Computer Won’t Break Bitcoin

January 13, 2019 |

IBM recently unveiled its Q System One at the Consumer Electronics Show (CES) 2019, with the company describing the quantum computer as being developed for “commercial use.” Despite numerous media outlets again decrying the imminent death of Bitcoin, IBM’s quantum system is not the game-changer that many are heralding it to be.

Also Read: Japanese Regulator Clarifies Stance on Bitcoin ETFs and Derivatives

IBM Unveils Quantum Computing System

No, IBM’s Quantum Computer Won’t Break BitcoinIBM’s commercial launch of its new quantum computing system has fueled reports claiming that the technology may spell doom for bitcoin and cryptocurrency.

The reports are based on a long-standing fear that the advent of quantum computing could break contemporary encryption practices, undermining the security of distributed ledger technologies.

The Q System One uses IBM’s 20-qubit chip, with the company claiming that the unit is “designed for commercial use.” At launch, Arvind Krishna, director of IBM Research, described the system as “critical in expanding quantum computing beyond the walls of the research lab as we work to develop practical quantum applications for business and science.”

Despite IMB implying that the computer can be physically purchased, the device is only accessible via the cloud due to the extreme delicacy and climate required to operate quantum chips. According to Gizmodo, IBM also “already offers cloud-based access to its [quantum] experience, which includes the 20-qubit chip.”

Experts Doubt Practical Uses for IBM’s 20-Qubit System

No, IBM’s Quantum Computer Won’t Break BitcoinWhile a number of analysts have noted the commercial significance of IBM’s Q System One, many onlookers are skeptical of the capabilities of the system, instead suggesting that 50-qubit chips are likely to have a greater array of practical applications.

Helmut Katzgraber, principal researcher at Microsoft Quantum, similarly described IBM’s announcement as a “historical milestone to be able to commercially acquire a digital device, even though the technology is at its infancy,” but anticipates that the system will be of little use beyond research and PR.

IBM Q System One Comprises Commercial Rather Than Computational Milestone

No, IBM’s Quantum Computer Won’t Break BitcoinDespite describing the increasing accessibility of quantum computing as “significant,” Andrew Childs, the co-director of the Joint Center for Quantum Information and Computer Science at the University of Maryland, expressed skepticism regarding IBM’s device, stating: “Ultimately though, I think figuring out how to make a lot of low-noise qubits is a lot more important than figuring out how to put them in a beautiful package.”

“It’s more like a stepping stone than a practical quantum computer,” stated Winfried Hensinger, professor of quantum technologies at the University of Sussex. “Don’t think of this as a quantum computer that can solve all of the problems quantum computing is known for. Think of it as a prototype machine that allows you to test and further develop some of the programming that might be useful in the future,” he added.

What do you think of IBM’s Q System One and the purported threat quantum computing poses to cryptcurrency? Share your thoughts in the comments section below!


Images courtesy of Shutterstock, IBM Research


At Bitcoin.com there’s a bunch of free helpful services. For instance, have you seen our Tools page? You can even lookup the exchange rate for a transaction in the past. Or calculate the value of your current holdings. Or create a paper wallet. And much more.

The post No, IBM’s Quantum Computer Won’t Break Bitcoin appeared first on Bitcoin News.

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Newspaper Ad Seeks Donations for Bitcoin Baby’s College Fund

January 13, 2019 |

Newspaper Ad Seeks Donations for Bitcoin Baby’s College Fund

Despite being just one week old, Izabella Bowles carries great expectations upon her tiny shoulders. The baby, born on Jan. 6, will go to college when she’s older, if parents Wioletta and Peter can help it. What’s more, her future tuition fees will be paid for using what many believe to be the future of money – bitcoin.

Also read: Thai Startup Atomicpay Launches Non-Custodial Crypto Payment Platform

Wanted: Donors to Support Bitcoin Baby’s College Fund

The listing in The Times looks a little different from those adjacent to it on the births, marriages and deaths page. Aside from the prominent black box delineating it, there’s the unusual title – “Bitcoin Baby” – and the string of 33 multi-case letters and numbers running across the bottom. Appearing in the same newspaper from which Satoshi famously derived his encoded genesis block headline (“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks”), the ad’s placement appears to have been a knowing nod from Izabella’s parents. Just three days earlier, Bitmex used the same British newspaper to take out a double-page ad marking Bitcoin’s 10th anniversary.

Newspaper Ad Seeks Donations for Bitcoin Baby’s College Fund
Izabella’s BTC college fund address

While the Bowles family are not the first to attempt to solicit donations for their child’s education, their methodology is certainly novel. There are signs that their college campaign has been successful so far, with little Izabella’s BTC address having amassed 0.84 BTC from 75 transactions in the past few days. Interestingly, the address in question, 1ZAB5XeKMdvax2S8eZT7GQ6Nj4xjbsw1Y, bears more than a passing resemblance to the name of the child who will one day inherit it.

Mixed Opinions About the Bitcoin Baby’s Fund

With the average cost of a four-year British university education priced at $ 52,000, Izabella’s fund is already 7 percent of the way there. Given the difficulty associated with manually typing in a bitcoin address, the donations that have arrived so far are likely to have come from the address being shared online rather than extracted from the print edition of The Times.

Newspaper Ad Seeks Donations for Bitcoin Baby’s College Fund

On Reddit, opinion has been divided about the bitcoin baby’s college fund, with one describing the parent’s initiative as a “disguised way to beg.” Others applauded the parents’ ingenuity, but took issue with the fact that the baby’s real-world identity will be forever tied with a BTC address. Predicting how much bitcoin will be worth 18 years from now is all but impossible. If past performance is anything to go by, however, Izabella’s 0.84 BTC might already be enough to fund her college tuition in 2037.

What are your thoughts on the bitcoin baby’s college fund? Should her parents be applauded or criticized for their actions? Let us know in the comments section below.


Images courtesy of Shutterstock and Reddit.


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

The post Newspaper Ad Seeks Donations for Bitcoin Baby’s College Fund appeared first on Bitcoin News.

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Japanese Regulator Clarifies Stance on Bitcoin ETFs and Derivatives

January 13, 2019 |

Japanese Regulator Clarifies Stance on Bitcoin ETFs and Derivatives

Japan’s top financial regulator has clarified to news.Bitcoin.com its stance on bitcoin exchange-traded funds (ETFs), cryptocurrency derivatives, and upcoming regulatory changes. This follows reports that the agency may be considering approving an ETF that tracks cryptocurrencies.

Also read: Indian Supreme Court Moves Crypto Hearing, Community Calls for Positive Regulations

Bitcoin ETFs and Derivatives

Following recent reports claiming that Japan’s Financial Services Agency (FSA) may be considering approving one or more bitcoin ETFs, news.Bitcoin.com asked the country’s top financial regulator to confirm its plan regarding this type of investment instrument.

Japanese Regulator Clarifies Stance on Bitcoin ETFs and Derivatives

A spokesperson for the agency clarified on Friday:

There is no such fact that we are considering approving ETFs which track crypto-assets at present … we are not currently considering approving them.

The FSA also confirmed its position on cryptocurrency derivatives. Regarding “the listing of bitcoin futures on the financial instruments market,” the regulator said, “We are not considering that at present.”

The agency explained its reasoning to news.Bitcoin.com, stating that based on findings of the Study Group on the Virtual Currency Exchange Services:

Taken it into consideration that it is difficult for us to find constructive and social significance of trading crypto-assets derivatives at present, we think that there is no need for trading crypto-assets derivatives at financial instruments exchanges where many market participants are able to trade.

New Regulatory Direction

The FSA has recently published newly-proposed rules for crypto operators based on discussions and conclusions from 11 study group meetings. Self-regulation will play a major part in the ecosystem. In October, the agency approved the Japan Virtual Currency Exchange Association (Jvcea) as a self-regulatory organization (SRO).

The association is expected to “perform self-regulatory functions in a flexible manner, considering issues we have identified so far,” the agency told news.Bitcoin.com.

The FSA proceeded to outline the issues it expects the SRO to focus on. They are “insufficient risk assessment of crypto assets to be handled, inappropriate sales of crypto assets issued by providers themselves, excessive advertisement, over-emphasis on profit generation, no check and balance by directors and auditors, no internal audit, insufficient internal management control, insufficient AML/CFT measures and segregation of customer asset, and reluctance to disclose corporate information.”

Japanese Regulator Clarifies Stance on Bitcoin ETFs and Derivatives

ICO Regulation Coming Soon

When Japan legalized cryptocurrencies as a means of payment in April 2017, initial coin offerings (ICOs) and their tokens were not included. However, with the growing interest in token sales as a fundraising method, the FSA has turned its attention to the matter. The agency recently published a document outlining key areas which will be addressed in upcoming regulations.

The FSA will focus on “investment-type ICOs” and will “clarify that soliciting investments by funding virtual currency is subject to financial regulations,” the document reads.

Japanese Regulator Clarifies Stance on Bitcoin ETFs and Derivatives Specifically, “When soliciting 50 or more investors,” the agency plans to “require the issuer to provide public disclosure initially and subsequently.”

Brokers and dealers of investment-type ICOs will be regulated “on the same level as securities firms.” They will be required to “examine the business and financial conditions of the issuer.” Furthermore, both the current “unfair trading regulations” and rules to prevent insider trading will apply. There will also be restrictions on “solicitation to retail investors in the same manner as the restriction on unlisted stocks.” For other types of ICOs, the FSA plans to require crypto exchanges that deal with them “to provide information including the feasibility of the project.”

What do you think of Japan’s approach to cryptocurrency regulation? Let us know in the comments section below.


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Acquiring Crypto: Simple Steps to Buying Your First Bitcoin

January 12, 2019 |

Acquiring Crypto: A Few Easy Steps to Get Some Bitcoins

There’s a good chance you’ve talked to a friend about Bitcoin. Or maybe heard about this “crazy digital currency” in the news, but haven’t tried to obtain any because you think it might be difficult. These days, acquiring cryptocurrency is actually very easy, with various avenues you can take to purchase your first coins.

Also read: A Look at Some of the ‘Next Generation’ Mining Rigs Available Today

The Most Straightforward Methods to Buy Cryptocurrencies

In the early days, acquiring bitcoins wasn’t so easy and people jumped through all kinds of hoops in order to get some. Nowadays, the crypto ecosystem is vast, with multiple exchanges and various digital assets sold for fiat currencies. People can purchase cryptocurrency using methods like credit and debit cards, cash, Paypal, money orders, and even basic barter arrangements. If you’ve been looking for ways to buy a cryptocurrency like bitcoin cash (BCH) – or any other digital asset – then this article is for you.

The Non-Custodial Wallet

Acquiring Crypto: Simple Steps to Buying Your First Bitcoin
The noncustodial Bitcoin.com Wallet.

The first thing you should do is study the digital currency you want to buy so you can understand what you are purchasing. After choosing a cryptocurrency to invest in, like BCH or ETH, you should get a noncustodial wallet so you can store the assets in a safe place. An ethereum (ETH) wallet will not work with BCH and vice versa. The reason for getting a noncustodial wallet prior to buying coins is because you probably don’t want to leave your assets with a central exchange. Storing cryptocurrencies on an exchange, unless you are trading them, leaves your coins vulnerable to the risk of theft.

Bitcoin.com has a dedicated list of wallets that you can review. There’s also the noncustodial Bitcoin.com Wallet, which allows users to store, send, and receive both bitcoin cash and bitcoin core (BTC). After obtaining a wallet on your mobile phone or desktop, you can choose how to purchase some digital currency. There are three primary ways of doing so —  via an exchange, a cryptocurrency ATM, or a peer-to-peer service.

Exchanges

Exchanges are trading platforms that let you buy and sell cryptocurrencies for other digital assets or fiat. An exchange is a pretty quick way to obtain bitcoins as long as you are comfortable with the process. For instance, you will need a means of payment, because you are online and can’t use cash. Trading platforms allow customers to purchase cryptocurrencies in their local currency and you can usually pay using a credit card, Paypal, and bank wire depending on the exchange in question.

Acquiring Crypto: Simple Steps to Buying Your First Bitcoin
Bitcoin.com keeps a comprehensive list of the most popular cryptocurrency exchanges today.

Exchanges will also require identification and will want to verify your identity in some fashion. The trading platform may require a picture ID or some proof of residence. Two things you will typically have to wait for before actually purchasing coins on an exchange is a verified identity and a validated payment system. Once those are in order, the platform will let you purchase cryptocurrencies and from there you can send them to your noncustodial wallet. Check out Bitcoin.com’s extensive list of cryptocurrency exchanges.

Acquiring Crypto: Simple Steps to Buying Your First Bitcoin
Some of the most popular cryptocurrency exchanges allow users to purchase and sell digital currencies quickly.

The Automated Teller Machine (ATM)

Yes, even cryptocurrencies use automated teller machines (ATMs) and you might be able to find one in your local area. At the moment there are more than 4,100 digital asset dispensing devices across the globe and more being installed every day. In order to locate a machine in your local area, Coinatmradar.com is a great resource. There are a ton of bitcoin core (BTC) ATMs (sometimes called BTMs) that sell the coin for a fee of between 6-10 percent per transaction.

Acquiring Crypto: Simple Steps to Buying Your First Bitcoin
There are all types of cryptocurrency ATMs these days. Check out Bitcoin.com’s map of bitcoin cash (BCH) ATMs and find a local machine in your area.

There’s also a growing amount of bitcoin cash (BCH), dash (DASH), and ethereum (ETH) teller machines. Crypto ATMs are not like bank ATMs because instead of getting cash, you give the machine some paper bills and the device will send digital assets to your wallet, after you’ve given the ATM a valid public address. Some cryptocurrency ATMs don’t require identification, but there are some providers that do oblige the ATM user to supply picture ID.

Peer-to-Peer Services

Acquiring Crypto: Simple Steps to Buying Your First BitcoinThe last method for acquiring cryptocurrency is in a peer-to-peer fashion. In other words, you can buy coins from a friend who already has digital currencies or you can opt to use a service like Openbazaar.org, Localbitcoincash.org, Bitquick, Paxful, or Localbitcoins.com. These services allow anyone to buy from a person selling coins either in person or online by using an escrow system to keep the trades fair. Each peer-to-peer marketplace operates a little differently and depending on the service you can pay for your digital currency with things like cash, Paypal, Moneygram, Vanilla, gift cards, or a cashiers check.

Acquiring Crypto: Simple Steps to Buying Your First Bitcoin
Openbazaar lets users buy and sell an assortment of digital currencies.

After conducting trade with a seller you, can receive coins in relatively little time, but it’s a good idea to research the platform you are using and make sure the vendor has a trustworthy reputation. Typically, these traders have conducted a lot of trades and most platforms, like Localbitcoins, have a reputation system.

Learning the Basic Steps and Getting Comfortable

Buying a digital currency is pretty straightforward, and after doing it once you’ll get an understanding of some of the concepts involved like sending and receiving coins. It’s a good idea to read up on how to send bitcoins from one wallet to another and the basic foundations of the digital currency you decide to buy. Lastly, one last thing to remember is that you don’t have to buy a whole coin when purchasing currencies like ETH, BCH, or BTC. People can buy a fraction of the digital currency they want and can even set up recurring purchases of very small amounts of crypto. After doing it a few times, you’ll quickly get the hang of buying and using digital assets.

Do you think purchasing cryptocurrencies is easy? How would you recommend people buy their first digital coins? Let us know what you think about this subject in the comments section below.

Disclaimer: Readers should do their own due diligence before taking any actions related to the mentioned companies or any of its affiliates or services. Bitcoin.com and the author are not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. This editorial is for informational purposes only.


Image credits: Shutterstock, Bitcoin.com, Openbazaar, and Localbitcoincash.org. 


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Bitcoin History Part 8: When 1,500 BTC Cost Less Than $1

January 12, 2019 |

Bitcoin History Part 8: When 1,500 BTC Cost Less Than $  1

How much is one bitcoin worth? In fiat currency terms, that’s a constantly shifting answer, but ever since the beginning, the following has held true: one bitcoin is worth as much as the buyer is willing to pay. Today, that’s likely to be a few thousand dollars, but back in the day, the reverse was more likely to be true: for one dollar, you could buy several thousand bitcoins.

Also read: Bitcoin History Part 7: The First Major Hack

Calculating Bitcoin’s Exchange Rate

Bitcoin History Part 8: When 1,500 BTC Cost Less Than $  1Once an asset has a universally agreed exchange rate, tracking its rising and falling price thereafter is a simple matter. But when no one’s really sure what the market is willing to pay for an emerging asset, it can be hard to reach consensus on valuation – especially when there are no exchanges to facilitate price discovery. This was the dilemma that early Bitcoin adopters faced in early 2010.

‘We are in a sort of “chicken and egg” situation at the moment,” noted Bitcointalk forum member The Madhatter. “In order for an exchanger to sell bitcoins … to someone, they need customers who have dollars and want coins … I mean, why would an exchanger sit around and accept bitcoins that are generated on your computers? They are going to just blow out their float of dollars and fold.” A couple of months prior, the first rudimentary exchange rate for BTC had been calculated by influential forum user “NewLibertyStandard” (aka NLS). Their pricing system was based on the amount of energy required to mine BTC – or “BC” as it was still often referred to at the time.

A Simple Model to Get the Ball Rolling

“New Liberty Standard is doing fantastic and logical work to help ‘set the ball rolling’,” praised forum user “BitcoinFX” on Feb. 5, 2010, adding: “I’m currently compiling a Neural Network model that takes into account other factors such as the finite number of Bitcoins, daily Gold and Silver fixings, other currency pairs and daily exchange rates and the average number of Bitcoin users etc. I’m of course factoring in the New Liberty Standard. This will be a very adaptable model to help calculate and predict future exchange rates and I will share it with our growing community.”

Today, the pricing models used to predict future bitcoin prices have become infinitely more sophisticated, but even in 2010, it’s evident that some adopters were thinking beyond mere extraction costs, and trying to envisage a world in which Bitcoin broke away from its power pegged price and attained a value determined by an array of external forces.

Bitcoin History Part 8: When 1,500 BTC Cost Less Than $  1
Bitcoin prices, as quoted on the New Liberty Standard website in 2009

While NLS’s methodology has long since been retired, an archived web page reveals the BTC prices their system set back in 2009, explaining:

Our exchange rate is calculated by dividing $ 1.00 by the average amount of electricity required to run a computer with high CPU for a year, 1331.5 kWh, multiplied by the the average residential cost of electricity in the United States for the previous year, $ 0.1136, divided by 12 months divided by the number of bitcoins generated by my computer over the past 30 days.

In Dec. 28, 2009, according to NLS, $ 1 would have gotten you 1,578.77 BTC. Not bad.

Bitcoin History is a multipart series from news.Bitcoin.com charting pivotal moments in the evolution of the world’s first and finest cryptocurrency. Read part seven here.


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