Stellar Lumens (XLM) Forum with for newcomers and contributor's rewarded Check here

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The intention is for the microfinance institutions to use Stellar to cut costs and make it easier and cheaper to move money around and ultimately use a cryptocurrency based payments network. The move comes as Ripple has been establishing more banking relationships all over the world that plan to use the Ripple decentralized network to move value throughout the globe.
Microfinance Opportunity
Although controversial in many areas due to exorbitantly high interest rates, microfinance has made great in-roads into the developing world where established banking institutions find it difficult to originate loans at a much smaller scale. The microfinance institutes (MFIs), which are regulated as non-banking financial entities in most countries, work by lending small amounts of money to people in need and make profits by charging a much higher rate of interest than banks.
Cryptocurrencies provide a unique opportunity to make this market even more efficient by cutting transmission costs and matching lenders and creditors who are on different continents. There have been a few centralized solutions that resemble microfinance but none of them trustworthy enough for people to really use and really make a difference. The goals of microfinance and peer-to-peer lending are easy to combine with cryptocurrencies, since sending money to an address is almost free, irrespective of geographic location.Stellar, the cryptocurrency created to mirror the ideas behind Ripple but with an intention to make the initial distribution better, is entering the microfinance industry, with a partnership with Oradian, a core microfinance software company.
The major challenges facing the microfinance industry are more social and less technical, however. Some of the largest lenders, such as SKS Microfinance, have been linked to multiple suicides among the poor who took microfinance loans, after their inability to pay the company back.
There are many challenges facing the MFIs in the world today, and one of them is the quick and easy transfer of funds. Oradian’s software is meant as a means of communication among the global MFIs. With Stellar integration, it would be possible for all these institutions to communicate with each other and also send money to one another quickly. The aim, ultimately, is to get rid of physical cash transfers completely and digitize the industry to make it easier, faster and cheaper for the institutions and their borrowers.
The program is starting on a pilot basis, first in Nigeria.

Read More Read More, Posted by: Arryjunita
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“The unexpected tragedy of our financial system is that the less money you have, the more expensive it is to send money around.”
Those are the words of Joyce Kim, executive director of the Stellar Development Foundation, a small non-profit with a big goal: to provide a backend infrastructure for the global financial system that literally anyone, anywhere can patch into.
(Stellar also has some pretty big investors, too, including Khosla Ventures Senior Investment Partner Keith Rabois.)
“What we have to create is something that works seamlessly – and just as well in the developing markets as it does in developed markets – not siloed systems that work really well in the U.S. and Europe but have to connect to lots of different systems used in other parts of the world,” Kim told MPD CEO Karen Webster in a recent conversation about Stellar and how it hopes to connect the world’s financial systems.
Stellar is an open source protocol that lets users send and receive money between any pair of currencies – by using its own digital currency (conceptually similar to bitcoin) which happens to be called “stellar.” The use of stellar creates an IP layer between payment systems and currencies that serves as a common financial platform that can be used worldwide.
“What we’re trying to do is create a public protocol,” Kim explained. “The goal of that protocol is to make currencies and payments system with Stellar acting as the exchange medium – what Kim described as “the connective tissue between all these systems.
“[This has the potential] to fundamentally democratize access to these systems so that more people can build to them and more people can connect to them.”
The operative word here is “public.” And while they aren’t the only players with similar ambitions – Ripple and Circle spring to mind – Stellar is the only one doing it as a non-profit, because in their opinion this is not the kind of infrastructure that is the work of a single corporate entity. Kim believes that such a protocol has to be public – not owned by anyone or any entity. Only then, Kim believes, can it become economically efficient to move money around the world and encourage others to build applications on top of it that add additional value and utility – and that can also be monetized. Kim and her team believe that the big reason that the world’s financial systems remain so disconnected is because it is economically impractical for any individual entity to build the financial infrastructure that’s needed. The costs simply outstrip the gains, Kim said, particularly when one is talking about connecting the developing world where banking infrastructure is small to nonexistent there simply is not foundation to build on.
“What Stellar wants to do is to help bring the per transaction infrastructure costs globally down so low that people can create sustainable business models to serve these communicates,” Kim explained. “That means it actually has to be thought of as a public good that I like to say is owned by everyone and owned by nobody. I think of the Internet that way, can you imagine what the world would be like today if it were owned by a company? The way to move this forward can’t be a win lose, it has to be a win-win.”
Kim and the Stellar team believe that the 21st century offers the world a really new opportunity – the ability to render currency as data, and then move that data over the same digital rails that all data over the Web flows across. That is not only efficient, but changes the economics around the developing world and what it will take to give those people access to affordable financial services.
Last week, Stellar took another big step by announcing a partnership with Oradian – a cloud-based core banking software company whose target market is in Nigeria. Oradian will integrate Stellar into their core banking solution for enabling microfinance for people living in that country.
Nigeria is both Africa’s largest nation by population (174 million ), and it is also the continent’s largest economy. The population is also proportionally rather young and port city Lagos is increasingly becoming a middle class haven. The population however, is largely (80 percent) unbanked. Oradian aims to bridge the gap between Nigeria’s burgeoning economy and its unbanked citizens by enabling efficient and reliable financial transactions. With its new partnership with Stellar, this now connected financial software can link previously siloed or isolated markets, bringing services to people who previously couldn’t access them.
The initial pilot will focus on connecting MFIs in Northern Nigeria, a region where 68 percent of the population is financially excluded. The larger ambition is to bank the bottom billion.
“We’re in this amazing point in history where these microfinance units can be financially sustainable on their own,” noted Kim. Though she didn’t have an exact figure, she noted that around 150 million people worldwide are serviced in the developing world by microfinance schemes – but that minus a financial infrastructure that connects them, they are 150 million tiny units. Networked together it is a very different story.
“If we can actually connect them together, that extends the network to parts of the world that have not been fully serviced by traditional banking but can now be serviced by regulated entities,” she explained to Webster.
As of now, Kim explained to Webster, it takes 12 hours to move funds from one MFI in Lagos to an MFI in north Nigeria. Why does it take so long?
“You put cash in a bag and you put it on a bus. Twelve hours later it gets there.”
This is a first step, noted Kim, and the beginning of how Stellar hopes to connect MFIs worldwide – an idea that is gaining traction. A short time ago, money was moved the same way in Kenya – but now in the post M-Pesa world, that idea sounds as crazy in Kenya as it does in Boston. And this, notes Kim, is one of the true miracles that mobile makes possible – and this kind of influence is what drew her to the space.
“I’m from an immigrant family and grew up in New York,” Kim explained. “So everyone I knew growing up, including my family, had trouble sending money around. It’s really great to build tools to change how money works and to do it using phones. I think those innovations are remarkable. We’ve seen how M-Pesa can move an entire country.”
And moving entire countries is the business Stellar wants to be in. But unlike M-Pesa that started as a scheme to create interoperability in one country – Kenya – Stellar is trying to build and interoperable global solution. But it is a goal it thinks can be managed because they are leaving the local solutions to the local players, and instead are focused on building the digital infrastructure that can tie those solutions together.
“We’re the blank canvas that people can paint on to figure out what the local solution are but we give people that infrastructure head start. Baked into the protocol is the ability to be not only interoperable with folks in their own country, but also interoperable globally with anyone else who is tied into the protocol,” Kim told Webster.
Because anything, no matter how big, is really just a result of combing many smaller pieces.
The developing world is full of such financial units – to small individual to attract much attention, but perhaps, if Stellar succeeds, those small financial units will have the power to capture the interest of the entire world.

Read More Read More, Posted by: Grimm
A woman in Nigeria is buying a SIM card and top-up credits from an agent; increasingly, such agents are also collecting money on behalf of microfinance institutions.

Stellar, the cryptocurrency-based payments system launched last year by Jed McCaleb, announced a partnership with banking-software company Oradian to use Stellar platform in its core banking software for microfinance institutions (MFI), with an eye toward using digital-currency based payments networks to improve the ability of financiers to work with each other.

Since launching Stellar in July 2014, the team behind it – led by Mr. McCaleb, who previously founded both Mt. Gox and Ripple – has been busy managing its growth and looking for different uses of its protocol. In looking at the world of the unbanked and the microfinance industry, they think they found a good use.
Microfinance is a field pioneered by Dr. Mohammad Yunus in Bangladesh in the 1970s. The idea behind it is to extend banking services on a very small level to people in emerging markets who don’t have the resources to tap the traditional banking services. The industry has grown to the point where about 190 million families are currently served by microfinance, according to the World Bank. But it’s not exactly a modernized industry. Physical security is an issue, and the growth of the industry itself has stretched its ability to operate efficiently.
“There’s no way for microfinance companies to communicate with each other,” said Joyce Kim, executive director at the Stellar Development Foundation. The combined Oradian/Stellar product would allow microfinance companies to quickly send money to each other. “There’s something like 100,000 microfinance institutions, how do we connect them? How do they get the kinds of efficiencies that will change their lives?”
The partnership is going to move slowly, beginning with a pilot program in Nigeria, where moving money often physically carrying cash on a 12-hour bus ride. Stellar could, obviously, change that dynamic. (Paul Vigna)
- Nathan Lands thinks that he’s come up with bitcoin’s proverbial killer app. Mr. Lands, just 30, and his business partner William Cotton have come up with what they hope will be a user-friendly product that will give people an easy way to access and utilize the blockchain.
It’s called Blockai (“The idea is it’s an ‘eye’ into the blockchain,” he said) and the duo hopes it does for bitcoin among the general public what Netscape did for the Internet, which is to be the first product that was broadly accessible to the general public.
Becoming the Netscape of the blockchain is a lofty goal, and plenty of competitors are aiming at the same target, but it’s one upon which Mr. Lands’ has been fixated. This is his second stab at the killer app. He launched QuickCoin in 2014, which was a program that nestled inside Facebook’s platform, and allowed users to send small amounts of bitcoin to their friends.
The app got a flurry of attention at the outset, but it never really took off. Mr. Lands gleaned something from that failure, though. “Cash works fine,” he said. “There’s got to be other, unique reasons to use bitcoin.”
In capitalizing on the promise of the blockchain, he thinks that he’s found that unique reason. “Really, the blockchain at its core is the world’s first reliable public database.” That gives users an opportunity to upload anything from a simple message to a friend to a work of art or a legal document, and use bitcoin’s currency to monetize that asset. What Blockai seeks to do is become the easy-to-use platform that facilitates that.
The team is working on the beta version now – perfecting the desktop version, building a mobile app – and doing the rounds on the fund-raising circuit. Mr. Lands expects to launch the product broadly in the next two or three months.
“Netscape took regular people into the Internet,” he said. “We want to do the same thing for the blockchain.”


Read More Read More, Posted by: Grimm
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Praekelt Foundation, an Africa-based nonprofit that aims to leverage mobile technology to help those living in poverty, plans on using Stellar to help the unbanked gain access to financial services.

The foundation, launched in 2007, has spearheaded a number of projects leveraging mobile communications to improve their everyday lives, among them: promotion of HIV/AIDS awareness, promotion of youth literacy using short stories on a mobile device and an appointment reminder system for those on chronic medication.
Teenagers in poorer areas of South Africa will be reportedly given the chance to test out what has been termed as a “digital savings account” operated via text messages. As an extension of a mobile social network already used, the savings feature is slated to allow them to earn mobile airtime credits in exchange for activity on the social network.
Stellar would serve as the currency in the system. Gustav Praekelt, the organization’s head, envisions that the digital currency will eventually be expanded for use in a full-fledged savings account scheme. The aim would be to leverage Stellar’s ability to transfer funds, without the need for an intermediary, to help educate the youths on the art of saving money.
The foundation reportedly develops a software called Vumi that powers interactive functionality on mobile phones without the need for data plans for internet. Humanitarian organizations including UNICEF, USAID and the Gates Foundation reportedly use the software to deliver health and education programs.
DC Magnates has reaches out to Stellar for comment, but has not received a response as of publishing time.

Read More Read More, Posted by: Risa
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Bitcoin cheerleaders have maintained, that digital currency technology can help lift the world out of poverty and revolutionized money, all at the same time. A very lofty goal, but how are the poor going to join the cryptocurrency revolution, when most don’t have access to computers and internet? Most of the bitcoin innovation and development is aimed at smartphone applications. In poor African countries, very few people have smartphones, a large majority of the population own mobiles that are equipped with text messaging capabilities.
A South African nonprofit, Stellar Development Foundation, backed by payment processorStripe,  is attempting to give cryptocurrency functionality on a text messaging based mobile platform. The stellar cryptocurrency is based on bitcoin’s blockchain technology, the idea behind stellar, is to form an intermediary between traditional currencies. Stripe will attempt to build a digital wallet functionality that is compatible with the existing mobile social networks that are being used in South Africa. Stellar will allow users to earn mobile airtime credits. In some countries mobile credits are used as a currency.
Stellar will be offered as a plugin to users who already use social networks build on the Vumiplatform. Vumi is a freeware platform developed by the Praekelt Foundation to allow text messaging services to run on mobile phones which do not have data plans. Vumi is utilized by UNICEF and the Gates Foundation to disseminate educational programs in Africa.
Stellar will initially be aimed at educating teenage girls living in poverty about money and savings accounts. Teenagers will be rewarded with airtime credits by sending messages and other activities on the social network. According to Praekelt, the experiments savings account program will initially be launched in South Africa, but there are plans for Indonesia as well.
The Praekelt Foundation hopes that, stellar, someday will become a base platform on which more sophisticated financial application can be deployed. Stellar could one day become the channel through which government aid programs can be more easily implemented. Stellar is currently only used by the Praekelt Foundation, but the hope is that other charitable and nonprofit organizations will see the value and join in.
Digital currency technology is still in its infancy and governments are still grappling with regulatory approaches. Stellar is a great idea with a very noble goal, but its success will be hampered should governments take an aggressive stance towards cryptocurrencies. Kenya’s M-Pesa, a mobile money service was only allowed to proceed after wireless carries received regulatory approval. Whether stellar receives the same treatment remains to be seen.

 Traderman  February 20, 2015

Read More Read More, Posted by: amega
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The Praekelt Foundation, a non-profit that seeks to use technology to help millions in Africa, is using the open source protocol developed by cryptocurrency organizationStellar to develop a mobile wallet.

The wallet will allow people to save cash or airtime using Praekelt’s own messaging platform, Vumi, with a focus on helping the economic situation of girls in South Africa. Vumi is similar to Whatsapp but is open source and designed for the developing world.
Joyce Kim, Executive Director of Stellar, blogged this about the project:
Quote:When Stellar began digging into this issue, we met the team at Praekelt Foundation, an amazing nonprofit based in South Africa that has been using open-source technologies to deliver essential information and inclusive services to millions of people living in poverty.
Vumi is alreadly the core of South Africa’s national maternal healthcare program, MomConnect, which messages expectant mothers prenatal health information during their pregnancies. After being launched in South Africa last year, Praekelt is introducing the service in Nigeria, Africa’s most populous country. Since its establishment, Praekelt’s programs have apparently helped over 50 million people across 15 countries in sub-Saharan Africa.

Vumi’s financial infrastructure permits anyone to open a personal savings account, deposit airtime, an alternative currency, and withdraw it later.
The savings program is currently a pilot project in South Africa which promotes early financial encourages early financial literacy. For many in the program, Vumi is their first formal savings account. There are plans to expand Vumi to Kenya and Nigeria,
Kim added:
Quote:Vumi’s pilot program and its focus on girls closely aligns with our core mission at Stellar—financial access for all. Through careful research and measurement, Vumi aims to demonstrate that accepting airtime while also offering incentives and education will result in increased savings and improved financial security for girls.
Girls who are saving small amounts for school fees today could be contributing monetarily in their homes and communities in a few years. We want to start investing in that future now.

Hans Lombardo  February 5, 2015
Quote:About The Author
Hans Lombardo
Journalist, policy analyst, and evangelist of new, disruptive technologies including big data analytics, Internet of Things, and cryptocurrencies. Internet industry veteran with regional c-suite experience, and journalist credentials earned at, Internet World magazine, and Mecklermedia Corporation.

Read More Read More, Posted by: prime
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Blockchain, the bitcoin company best known for its popular consumer wallet and block chain explorer, is on the hunt for a group of beta testers to help it develop new tools and features.

The Blockchain Beta Group will include developers and customers of the site, according to an official blog post. The notice also reached out to members of the community who may want to participate.

The need for the a beta group rose out of Blockchain’s fast-paced development, CEO Nic Cary told CoinDesk.
Cary said:

Quote:"Blockchain has a very aggressive release schedule and we've decided to solicit the bitcoin community to help give us early feedback. We're not trying to do things the old-fashioned way here."

Blockchain believes beta testers will help improve the overall user experience it offers, while providing those involved with a first look at Blockchain products.

Tapping the power of the community
Blockchain listed a series of questions for those seeking entry into its pool of beta testers, asking applicants how often they use bitcoin, whether they had taken part in previous beta pools and what they do with their BTC.
The only requirements for the beta pool are that interested parties fill out the questionnaire and, if contacted by the company for participation, sign a non-disclosure agreement.

Cary added that Blockchain is seeking a varied group of participants from across the bitcoin community.

Cary said:

Quote:"Bitcoin users come from a hugely diverse and distributed background - it's our hope to tap into their enthusiasm and experiences to improve and refine Blockchain apps."

A busy year for Blockchain
Earlier this month, Blockchain announced that it had signed a five-year deal to manage ‘’, as part of a move aimed at expanding the company’s public outreach efforts.

Blockchain has also partnered with the Bitcoin Foundation on the first-ever Blockchain Awards, though not all its news has been positive. For instance, it suffered a severe outage in mid-March caused by a database glitch. 

Read More Read More, Posted by: sync19

Bitcoin wallet and block explorer provider Blockchain has unveiled its latest Android wallet update, announcing the news at The North American Bitcoin Conference (NABC), an ongoing two-day industry event taking place in downtown Chicago.
The official launch follows the release of early previews provided by the company in June, a leak that coincided with Blockchain's debut of its new customer onboarding tool,

Blockchain CEO Nicolas Cary framed the announcement as part of a broader update to the company's wallet service that will find it issuing more news through the summer. Combined, this initiative will help the company better meet the scale that it excepts as more consumers join the bitcoin ecosystem.

Cary said:

Quote:"We're completely focused on creating simple and engaging experiences so we can go to web scale – supporting hundreds of millions of users."

Notably, the updated Android wallet integrates with user address books and includes an in-app merchant map that can be leveraged to find bitcoin businesses.

Click below to view a gallery of app images:

Merchant mapping
One of the more novel aspects of the new app is its inclusion of a merchant directory that the company says uses a "fully verified database" to let users discover local businesses that accept bitcoin in a similar way as traditional merchant directories such as Yelp.
Images provided by Blockchain show that in-app business directory pages include the phone number, address and website of bitcoin companies, as well as a description of their services.

Users can also search an interactive map that includes five unique, color-coded pins to specify the nature of the business and its services.


Reimagining interaction
Keonne Rodriguez, Blockchain's product lead, said that the goal with the app redesign was to focus on user experience, and images show that personal finance management services may have influenced the final release.

For example, the wallet dashboard allows Android users to see their balance and divide their funds into categories such as "Vacation", "Car" or "Savings" to better manage their finances.

Additionally, the wallet will enable peer-to-peer transactions without the recipient needing an existing bitcoin wallet, providing bitcoin users with a way to bring more interested individuals into the ecosystem.

Conference update
The announcement followed a Saturday speech by Blockchain COO Peter Smith, who spoke opposite [url=]CoinSetter
 CEO Jaron Lukasiewicz at the NABC.
The event also featured speeches from notable industry leaders such as BitPay senior software engineer Jeff Garzik, OKCoin CTO Changpeng Zhao and Bitcoin Shop CEO Charles Allen.

For more news and breaking announcements, follow CoinDesk's live Twitter coverage of the event.

Read More Read More, Posted by: sync19

Users have reported a bug in the denomination functionality on Blockchain's iOS app whereby orders are being billed in 'bits’ – also known as 'uBTC' – rather than 'BTC'. For example, a user buying an item would click the 'Pay with Bitcoin' link, but their wallet (configured to display in 'bits') would send .0843 bits instead of .0843 BTC. CEO Nic Cary says a fix will be implemented in the app's next update "imminently".

Following Apple's controversial removal of iOS bitcoin apps in January, the first of the big-name wallets relaunches on the App Store today.
Blockchain, which already provides hugely popular wallets for both desktop computers and Android devices, has unveiled its new-from-the-ground-up iOS wallet, which it hopes will bring bitcoin to users across the globe.


Prior to Apple’s removal of all apps offering cryptocurrency transactions in January 2014, Blockchain was the most downloaded bitcoin wallet for iOS devices.

Controversial ban
Blockchain's announcement will likely come as welcome news for the bitcoin community, which protested loudly at Apple's ban – with some users even shooting their iPhones in an unlikely show of support.

However, for reasons known only to Apple insiders, a new, more open policy was announced at the Worldwide Developer’s Conference in early June, paving the way once more for bitcoin wallets and other apps that transact using cryptocurrencies.

In the weeks since then, the App Store has seen the addition of several bitcoin apps, including an unofficial wallet for Coinbase users and Gliph, a messaging service that lets connected users send each other bitcoin. However, Blockchain is the first of the major players to offer wallet services on iOS since early 2014.

Nicolas Cary, CEO of Blockchain, told CoinDesk:

Quote:“The moment Apple signalled a shift in their policy toward digital currency apps, we pulled the iOS project off the shelf and got to work. We wanted to use this as an opportunity to improve the wallet, but we were still apprehensive about dedicating huge amounts of engineering time because it wasn't clear what types of apps would get through the submission and approval process.”  

He added: “Working with Apple has been quick and easy, and we really appreciate their thoughtful guidance – it's a partnership we really value.”

The new app
As well as exchanging bitcoin between wallets, Blockchain's app also allows iPhone and iPad users to make purchases from the fast-growing number of merchants that accept bitcoin – both online and in physical outlets.

That list has this year expanded to include major retailers such as OverstockDISHExpedia and, most recently, Dell (for more, see our guide to bitcoin-accepting merchants).


Cary said that Blockchain has rebuilt its wallet app from scratch to improve security, enhance performance, and introduce a new user experience. He explained:

Quote:“The app strikes a strong balance between functionality and security. At Blockchain, we always believe in putting users firmly in control of their funds and that hasn't changed with the new iOS wallet. You'll also find a new security PIN screen and we have updated the default miners' fee when sending transactions.

New features coming
Cary told CoinDesk that the new wallet for iOS will be available for users to download from the App Store today, adding:

Quote:“We invite bitcoin enthusiasts everywhere to give it a try. We're looking forward to adding exciting new functionality going forward, including the very popular Merchant Map from our Android Wallet. Stay tuned for lots of updates.”

He further explained that the return to Apple iOS is “hugely important for bitcoin in general and very exciting for Blockchain”. The release of the app means that the millions of iOS users around the world will now have the opportunity to experience bitcoin first-hand, Cary indicated, adding:

Quote:“Furthermore, this confirms that Apple is welcoming back the development community to invest, build, and create bitcoin apps again.”

Blockchain is currently the most popular bitcoin wallet in the world with over 1.9 million users. Its website,, also hosts bitcoin charts, currency statistics, and a block-chain explorer.

Disclaimer: This article should not be viewed as an endorsement of any of the companies mentioned. Please do your own extensive research before considering investing any funds in these products.

Read More Read More, Posted by: sync19

Blockchain now has over two million bitcoin wallets in the wild, having added roughly one million over the last six months alone.
The company tweeted the latest milestone late Sunday night, cementing its position as the world’s most popular bitcoin wallet provider.


[Image: rMuSXKi6_normal.png]Blockchain 

Here's to Two Million #Blockchain wallets, millions more, & putting #bitcoin in everyone's hands! …
1:56 AM - 11 Aug 2014

Peter Smith, Blockchain's COO, said:

Quote:"Being the first bitcoin company to reach two million wallets is an exceptional honour [...] The endorsement of the now millions of bitcoiners who have chosen to use our wallet is a distinction that truly humbles us as a team."

Smith added that strong growth coupled with price stability is an indicator that the industry is moving towards a "transactions paradigm."
Indeed, the company has witnessed rapid expansion in recent months.

Back in January 2013, Blockchain boasted more than 100,000 wallet users. The 500,000th wallet was created in late October and the company [url=]rewarded the lucky user of its 500,000th wallet with 10 BTC.

Blockchain passed the one million mark in January 2014 and by April it had about 1.5 million wallets. In other words, the organisation has doubled its wallet downloads in roughly six months.

Smith pointed out that downloads "exploded" in July, after its iOS wallet was re-launched and made available on the Apple App Store. Earlier this summer, the company also updated its Android wallet with a number of merchant-friendly features.

The competition
Blockchain is not the only bitcoin company to boast such figures. Back in February, San Francisco-based wallet provider and payments processor Coinbase entered six-digit territory and announced that it had more than a million wallets. The company had started with just 13,000 wallets in early 2013.

Bitcoin wallet provider MultiBit also passed the one million mark in March 2014. However, MultiBit cautioned that the statistics were not complete, as data on early adopter downloads dating back to 2011 was lost.

There is, however, an important caveat. A significant number of downloaded and installed wallets does not necessarily translate into active bitcoin users.

Wallets are frequently downloaded by people with a casual interest in bitcoin, which means a large number are inactive or abandoned. charts shed more light on bitcoin user statistics, but it is still difficult to say how many truly active wallets are out there and how many have been abandoned.

Blockchain told CoinDesk that it is currently handling tens of thousands of transactions every day. An estimated $22bn in bitcoin transactions were made using Blockchain software so far.

Read More Read More, Posted by: sync19
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Blockchain announced today that it has secured a record $30.5m Series A funding deal, co-led by Lightspeed Venture Partners and Wicklow Capital.

The figure is one of the largest ever single investments in a bitcoin company, after BitPayannounced a new record with its $30m Series A round in May and Xapo achieved the gold standard for total funding with $40m over two rounds in Marchand July.

Blockchain is the world's most popular bitcoin wallet provider, search and technical information source with 2.3 million wallet accounts and a total $26bn in transaction volume.

Today's news marks its first funding round from external investors. It was previously bootstrapped by founders including Roger Ver, who remains with the company.

Blockchain president Peter Smith said:

Quote:"The company has grown exponentially in every way over the last 18 months. We are honoured to add investors and partners to the team with deep expertise in financial services and consumer technology."

Future Plans
According to a report in the New York TimesLightspeed partner Jeremy Liew will take a seat on Blockchain's board.
Blockchain will use the extra funding to grow its product and engineering teams, and expand and invest in developing markets. Wallet services would be the "central nexus of value creation" in the digital currency industry, said Liew.

Founder and CEO Nicolas Cary told CoinDesk he was looking forward to the opportunities such an investment would bring. He said:

Quote:"This is the first outside capital in Blockchain. We've accomplished a lot with a little. So now we're even more excited about what we can do. We have a very compelling product roadmap and we're eager to share it with our users over the coming months."

Blockchain produces software tools for merchants to accept bitcoin, and acquired bitcoin price and data provider ZeroBlock last December. It also manages the premium domain name, which it uses to introduce bitcoin to total newcomers.

Key bitcoin player
The announcement from one of bitcoin's oldest and more respected service providers is bound to warm hearts in the bitcoin world, amid news dominated recently by price drops and market anomalies.

Blockchain is notable for practicing the cryptocurrency ethos it preaches. Its mission is equal parts growth of its own business and building an international bitcoin ecosystem.

Fervently decentralized and traditionally bitcoin only, Blockchain's international staff have received salaries in bitcoin and the company has until now done its deals, including acquisitions, in bitcoin.

It is also one of the only major bitcoin companies to not have a bitcoin trading or even a buying platform, preferring to focus on making bitcoin accessible and useful to everyone.

Rapid expansion
Blockchain's growth reflects the rise of bitcoin's own popularity and awareness levels. The company, which was a one-man operation from its August 2011 beginning until the spring of 2013, and operated with only a handful of employees as recently as seven months ago, now has a total 21 employees in various locations around the world.

It recently announced its two millionth wallet account (there are now 2.3 million), more than half of which are from sign-ups made this year. At the beginning of 2013, it had just 110,000 accounts and by the end of October that year it had 500,000.

The Blockchain mobile app's relaunch on both Android and iOS, together with its re-admission to Apple's iOS App Store in July, are in part responsible for those numbers.

Other investors in this funding round included Mosaic Ventures, Prudence Holdings, Future Perfect Ventures, and a number of angels including Rafael Corrales of CRV, Amit Jhawar of Braintree and Nat Brown, among others.

Read More Read More, Posted by: sync19
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The Bitcoin Foundation has issued a fraud alert over fake websites that are attempting to steal innocent visitors' bitcoin.
The bitcoin advocacy organisation said in a statement that it knows of two cloned websites, and, which are cloning the legitimate Bitcoin Foundation site and spoofing web addresses and domains.

"Neither of these domains have anything to do with the Bitcoin Foundation," the foundation stressed.

How the scam works
Bitcoiners are directed to a fake page that looks like the legitimate Bitcoin Foundation website, where they are asked to submit their bitcoin address in order to receive a "gift" or compensation for losses incurred by the bitcoin price slump.

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CoinDesk used a dummy bitcoin address to find out what happens next.
Firstly, the site brings up a notification that the user has won a certain amount of bitcoin, in our case 17.4439042675 BTC. They are then asked to "login with Blockchain"

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The site then forwards visitors to a site ( that mimics that of bitcoin wallet and data provider Blockchain. Users attempting to log in and redeem their 'free' bitcoin will actually be giving their password to the scammers.

It is worth noting, however, that the text on the fake Bitcoin foundation site is poorly written and likely not the work of a native English speaker. This makes it simpler for visitors to identify the site as a scam.

Appeal for vigilance
The Bitcoin Foundation urges users to report other similar sites they may come across to, with the subject line "SCAM SITE" and also suggests there may be fake sites in languages other than English.

The foundation said:

Quote:"We are taking steps available to us to help remove these offending websites from the Internet. While we only know of the two, we are continuing to monitor any other additional scam sites."

This is merely one in a long list of bitcoin scams, but what makes these sites notable is the sheer audacity of the perpetrators, who are trying to pass themselves off as some of the biggest names in bitcoin.

Read More Read More, Posted by: sync19
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It has been a terrible couple of weeks for bitcoin wallet provider Blockchain.

First, the firm’s product lead got into an online spat with a Coinbase engineer on Reddit. Then, Blockchain's wallet was pulled from, an informational website managed by bitcoin core developers and community members, for poor security.

The company found itself publicly promising to reimburse customers after a random number generator flaw that led to hundreds of addresses being compromised. Further, unsubstantiated online reports suggested that bitcoins had been stolen as a result of the issue.
So, what went wrong, and what’s going to happen next?

Let’s take the most recent issue first. The firm was forced to make a security disclosure on its blog and on Reddit, admitting that a development error had led to a problem with the generation of private keys. Private keys (effectively the private addresses used to hold bitcoin) were generated with a low degree of entropy, making them easy for attackers to retrieve.

Online blowback
Blockchain offered to reimburse all customers for lost funds, but the online blowback was still huge, with commenters accusing the company of bad development work and managerial problems.

Commenters on Bitcoin Talk criticised Blockchain for several things, including letting developers push code to a production environment.

One Reddit commentator said:

Quote:“This is seriously simple stuff. Web business 101. A developer should literally not have the ability to put anything near production, because if they do they will eventually do something stupid.”

“I don’t think that’s accurate to say that this is a real criticism on Reddit,” Blockchain CEO Nicolas Cary told CoinDesk, about accusations of poor development processes.

He added:

Quote:“I think a few outspoken community members that have a lot of their own personal brand at stake are making some accusations. We’re listening to those. We know that we have to do better. We have a very strong development team."

"We have built a huge amount of software," he continued. "We have released safely all the time, we have quality assurance leads. We have a security team. The real message to the community is that we are going to get better. We know we need to do a better job. At the same time, we have the humility to do what's right and take care of our users when there are issues."

Core bitcoin developer Peter Todd also criticised the company for only having a manual testing repository in its GitHub repository, rather than a fully automated test suite.

Blockchain’s senior executives did not offer a formal response to Todd’s tweet. Neither did they confirm that there was an automated test suite in the company, discuss their development process or comment about the $30.5m Series A funding deal Blockchain completed in October.
Redditors had criticised the firm for failing to tighten security issues with the money. Sources close to the company privately pointed out that it takes time for a freshly funded company to use that money and make the necessary internal changes.

The delisting
All of this happened just days after the organisers of took Blockchain off the list of wallets that it provides for bitcoin users, with commenters suggesting that "it should be revisited with reasonable criteria at least as demanding as other wallets".
In the discussion within the GitHub pull request concerning the wallet’s listing on, site maintainer Saïvann Carignan highlighted several factors. The first was bugs and losses, of which there have been several, he said.

The second was backup and password security. "[Blockchain] hasn't adopted security features which are slowly becoming standard in other wallets (e.g. BIP32, random passphrases, backup on setup, rotating addresses, 2FA by default),” he said.

He also criticised the company for not being transparent enough, and not resetting the app’s source code, adding:

Quote:“To be fair, each of these issues would have blocked or delayed listing Blockchain if the wallet was submitted today. Accordingly, I think the logical next step to incentivize security and reduce risks for the user is to raise the bar for Blockchain like other wallets”.

Ben Reeves, Blockchain’s CTO, posted a response in that GitHub discussion addressing the complaints and promising several changes. This was praised by the other participants, on the basis that the initial criticisms concerned the track record of the Blockchain service. So, the consensus remained to delist the wallet for at least 60 days, and to let Blockchain resubmit it after that.

Carignan acknowledged complaints that there was no set policy for listing or delisting wallets from, and opened another discussion to develop a standard process.

"We are eager to resubmit there. We respect their decision, but ultimately we have made a lengthy defense for our position. We are still the only open-source company," said Cary, who added that the company is making changes to its software, and that people should expect "exciting things coming to market in 2015".

A wider FinTech problem
Blockchain has made its mistakes, but Emin Gün Sirer, an associate professor of computer science at Cornell University and an expert in bitcoin security issues, warned against a witch hunt.

He said:

Quote:"To their credit they have realised that their processes were broken when they made some personnel changes internally to bring different people in charge of security. I have had private conversations with them and it sounds like this is a bunch of people trying very hard to patch the flaws as they appear."

These security issues are a sign of a wider problem in the cryptocurrency space, warned Sirer.
"There is no room for the smallest screwup, and we’re finding out that standard practices that are normal in Silicon Valley are unacceptable in the bitcoin world because there’s so much at stake," he said, arguing that the rate of security failures is high across the bitcoin industry.

Online spat
Cary also called the timing for this whole affair "suboptimal". That seems accurate, given an online spat that broke out between Coinbase and Blockchain executives earlier this month over bitcoin wallet security, in which Blockchain staff criticised Coinbase’s operating model.
It all started with a Reddit post by Charlie Lee, the creator of litecoin, who took a job at Coinbase18 months ago. Lee, now engineer manager at the company, wanted to set the record straight about security at the centralised wallet service.

Lee described what the service has done for the security of its users. Among those he listed were default requests for two-factor authentication (using something you have, such as a phone, in addition to something you know, like a password) if making transactions above $100. The service also included a bitcoin vault for its users, and stores 97% of its own coins in cold storage, said Lee (CoinDesk has covered some of Coinbase’s security before).

All this information is part of the public record. The interesting part came in one part of Lee’s post, in which he compared CoinBase’s security to that of Blockchain. One part of the post (later removed) read:

Quote:“Over the past year though, Coinbase kept introducing new security features while Blockchain wallet's security has stayed exactly the same, and arguably became worse.”

This led to an angry riposte by Keonne Rodriguez, product lead at Blockchain, who criticised Lee for chasing his own agenda, and likened him to “a shady lawyer chasing an ambulance”.

A serious approach
Name calling and criticising doesn’t help anyone, suggested Michael Perklin president of Bitcoinsultants, and a specialist in bitcoin security. Perklin, also a director at the Bitcoin Alliance of Canada, has a background in security within other industries.
“I enjoy accurate discussions based on the merits of the argument,” concluded Perklin. “But whenever anyone throws mud at someone else, they have to get themselves dirty first.“

Those comments all occurred before Blockchain’s latest security debacle. What does Cary have to say about it now? He is still eager to draw distinctions between the two models.

Cary said:

Quote:“We have a lot of respect for what Coinbase are doing. We’re not here to start a mud-throwing contest with anyone. We want to have a company that basically has a long-term vision for the success of bitcoin, and takes consumer protection very seriously, and takes care of consumers where there are problems, but also continues to take a non-custodial approach to managing risk.”

Cary said that the company was eager to actively engage and listen. “We take all of these things super-seriously. We are here for the long term,” he concluded.

Read More Read More, Posted by: sync19
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A white-hat hacker who was able to take 255 BTC from Blockchain wallets following a security flaw earlier this week has returned the funds.
Bitcoin Talk member 'johoe', an account 1.5 years old but with only 21 posts, had always stated that he or she was taking the funds for safekeeping and would return them, writing on the forum:

Quote:"There were a large bunch of new broken addresses today (several 100s in one day). I took the liberty of saving some funds before they got swiped by others. If you can convince me that they belong to you (signing a message with the address is obviously not enough; the private key is already known), I will send the funds back."

Johoe then posted a page of 1,019 addresses said to be compromised, and invited users to check if theirs was one of them. Blockchain CEO Nicolas Cary confirmed to CoinDesk that the funds had been received.

Even before the funds were returned, Blockchain had admitted it was at fault and promised to reimburse any users who had lost money.

Random number flaw
The problem that led to the vulnerability was reportedly wallets generated with previously used 'R-values' in formulas that generate random numbers, meaning a hacker could use the public address to calculate its private keys. If R-values are unique, this should be impossible.
For the technically-inclined, Blockchain CTO Ben Reeves has pointed out the mistake in code on Blockchain's GitHub page here.

Blockchain posted in a statement that the issue affected web wallet users who had created a new wallet address or sent funds from an existing address during the period the vulnerability was live.

According to johoe, Reeves sent an email asking him to send the funds to this address, which johoe duly did, posting a photo of a Trezor wallet sending the transaction.

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Still solving the problem
Customers on Bitcoin Talk and Reddit, while relieved their funds were swept by someone with good intentions, are now contacting Blockchain to prove their losses and have them returned.

At this stage, however, it is not 100% confirmed that all funds removed from Blockchain wallets were under johoe's control. At least one user has claimed that nearly 100 BTC missing from his wallet have gone elsewhere.

Blockchain is in the process of examining "thousands" of customer claims and support tickets for authenticity before reimbursing.

Read More Read More, Posted by: sync19

Bitcoin's Wild West days may be numbered, or so the headlines would have us believe.

This week saw the release of the final version of the BitLicense, New York's long-awaited, and still heavily debated, state-specific regulation for bitcoin businesses. Unsurprisingly, the news was extensively covered in the media, and often heralded as a milestone in the evolution of the emerging technology.

Many stories used legitimizing language and headlines that foreshadowed that bitcoin had taken yet another step toward inclusion in the wider financial world.

However, the technology's growing pains were still on display this week, as it continued to be associated with illicit Deep Web-based activities and development issues dogged one of its most well-funded startups.

Milestone legislation
The victory lap for the BitLicense came swiftly following its 3rd June release, with the mainstream narrative all but arranged to trumpet the government's stamp of approval.

The Wall Street Journal's Michael J Casey wrote a piece, which noted:

Quote: "Outgoing New York Superintendent of Financial Services Benjamin Lawsky released sweeping new rules for licensing digital-currency businesses in the state Wednesday, staking part of his legacy on launching a specialised regulatory regime for an industry that many experts believe could play a significant role in the financial system."

In the article, Casey quoted Lawsky's statements in which he voiced his belief that the legislation struck the appropriate balance between protecting customers and rooting out illicit activity, while showing commitment to not "doom promising new technologies before they get out of the cradle".
"Whereas some have questioned why existing money transmission regulations can't be used for virtual currency businesses, Mr Lawsky said those Civil War-era laws simply wouldn't work for digital currency, a technology unlike anything we had ever seen before," said Casey.

More marginalized were the many dissenting voices who occasionally appeared in such content, arguing that the BitLicense would discourage the same spirit of innovation that propelled the early Internet.

Extensively covered by Western mainstream media, the news 
was also picked up by less likely outlets around the world, showcasing the technology's growing appeal abroad.

Kommersant, a Russian Daily, ran a headline which implied bitcoin had been legitimised as a digital currency; a loosely translated version read: "Cryptocurrency Recognised A Full Part of The Financial Market".

The article said:

Quote:"The key provision of the new rules is that now all the companies that work with cryptocurrency, you must have a special license from the Department, which should improve the safety of customers and transparency of operations cryptocurrency."

Such articles could no doubt have an influence on coming conversations regarding regulation that is seeking to ban the technology in Russia under rules for monetary surrogates.

Nail in the bitcoin coffin
It wasn't all good news for bitcoin.

Following Silk Road creator Ross Ulbricht's life sentence last week, it was not surprising to see how the debate around bitcoin's use in illicit activities was reignited.

Forbes published a piece by Jason Bloomberg in which the author outlined the digital currency's link to the Deep Web.

He wrote:

Quote:"Silk Road kingpin Ross Ulbricht's recent conviction and life sentence was more than simply a crackdown on a massive online black market for illegal drugs. It was a nail in the coffin for the radical new cryptocurrency bitcoin, as bitcoin was the glue that held Silk Road together."

Backtracking slightly, Bloomberg asked how significant the demise of Silk Road was for bitcoin, noting that this was part of an ongoing debate.
"Controversy, however, is nothing new for bitcoin. In fact, it seems the story of this digital currency consists of nothing but controversy," he wrote, adding: "In fact, perhaps the greatest challenge for bitcoin is divining the technology's true purpose. Early innovators often espoused radical Libertarian goals for revolutionising the banking system and with it, the world economy".

Quote:"By disintermediating third parties, bitcoin promised to usher in a new world order free of market commerce," noted Bloomberg.

Despite this, the author proves seemingly negative about bitcoin's performance.
"Bitcoin soon became a haven for criminals – not just Silk Road, but any number of money launderers and other shady types who gravitated toward an anonymous, relatively safe method for conducting financial transactions, in particular across national borders," he said.

'Total crypto breakdown'
Elsewhere, Blockchain struggled to right its news narrative, which has been marked by the kinds of security issues that may be alarming given that it closed $30.5m in funding late last year.

The Guardian ran a piece with an alarmist headline given the small number of users apparently affected, writing:

Quote:"Blockchain has issued an update for the Android version of its bitcoin wallet after discovering a critical failure which breaks the cryptocurrency's security."

Whether intentional or not, the latter seems to imply that Blockchain's bug could potentially affect bitcoin as a whole, as opposed to just users who store their holdings on Blockchain's wallets.

Writer Alex Hern explained:

Quote:"Bitcoin wallet application Blockchain has rushed to release an update after a critical bug left multiple users unaware that they were sharing a bitcoin wallet, leaving their cryptocurrency completely unsecured."

He continued: "The bug affected users running Blockchain’s app on Android version 4.1 or older [...] it resulted in one specific address being generated multiple times, leading to a loss of funds for a handful of users.”

According to Hern, the bug was due to a series of questionable development choices:

Quote:"Bitcoin wallets are typically created by randomly generating a public address and a related private key. As a result, it is important for address and key to be truly random, or else it may be possible to guess the private key by looking at the public address."

It seems that Blockchain used two sources to create the random numbers, pulling a random number from Android's built-in generator, and then connecting to online service to obtain the second combination.

Hern noted that on some Android devices, the built-in random number generator failed to connect and report back Blockchain's app.
Then, the battering continued.

Michael Mimoso wrote a piece for Threat Post with "Crypto Calamity For Blockchain Android App" as its headline.
Describing Blockchain as one of the busiest bitcoin wallets, the article said: "Shoddy crypto is being blamed for the loss of bitcoin for an unnamed number of Blockchain users."

It seems that New York's plans to regulate digital currency companies, at least for now, will do little to help solve the pain points for companies still struggling to gain wider adoption.

Read More Read More, Posted by: sync19


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