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Bitcoin
Wheels within wheels” – that’s what Gann called the fractal nature of markets.  That uniquely perplexing feature of market activity such that markets react to support and resistance at multiple time frames simultaneously.


Look at the daily Bitcoin chart we have been looking at for weeks now:



[Image: 1120a.png]


We can see that price broke through the 1st of the 3rd arc pair and is struggling as it is meandering its way toward the 2nd of the pair.  As I have suggested repeatedly here, when/if price closes above the 3rd arc pair, a fun rally will likely commence.
Now lets look at the exact same chart, but with a smaller bull setup beginning at the mid-May low:



As should be clear from the arrows which are highlighting just a few of the places wherein pricetime has respected the setup, this setup, like it’s much larger sibling above, is indicating why price has been moving sideways for a few days now.  On this setup, pricetime is working its way through the 4th arc pair.


The interesting this about this setup is that here we see pricetime will be at the end of the 3rdsquare as soon as the day after tomorrow.  It therefore will not be a surprise if an acceleration begins at that time.


To look at geometry from a different perspective, lets look at a pitchfork on an 8-hour chart:




Here we can that pricetime has been moving up a very steep angle, constrained by the 1.414, 1.618 and 1.732 extensions off a rather obvious pitchfork.  As of this writing, price is continuing to hug the 1.618 extension, as it has for the past few days.  I see no reason to believe that the 1.732 extension’s support will break any time soon.

Here, on the same chart, is a different, longer-term pitchfork illustrating a gentler sloping rate of ascent, with clear indications of where future support and resistance can be expected.  I have highlighted several places where that S/R has already been tested and held.  There are others I did not highlight.




Because these lines are not horizontal, one cannot easily say where the resistance is in terms of price, because the geometry is such that resistance determined by where in price and time ( pricetime), the line is touched.  If and when the 0 line (bold blue line) is touched, a selloff can be anticipated, though not necessarily a sell-off that a investor needs to worry about as much as a day-trader.  In other words, the longer term trend will likely remain upwards until at least the end of the year.

Ethereum
Here it 6 days after I was faked out by what looked like the beginning of a breakout on the ethereum daily chart, and the coin has still not been able to break free of the 3rd arc.




You can see how the 2nd arc thrashed ethereum price, which was later thrown to the ground exactly at the end of the 2nd square. It finally met the 3rd arc and began falling; price has not escaped the arc’s pull of gravity since then (all these market events are highlighted by blue arrows).  The good news is there is not much time before the arc loses its ability to hold the coin down. Time has passed such that pricetime will have soon moved passed the arc.  That could happen any time now, so ethereum traders should be alert to a trend change at any time.

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Like the recent US election, tensions within the Bitcoin Community have run high for the better parts of 2015 and 2016 as a rather-minor code change (known as the ‘block size debate’) has become a political race for competing factions, some of which have non-developers as spokespeople pushing an alternative to Bitcoin’s core client, Bitcoin Core.


In the past for the Bitcoin Core team, soft forks have not prevented much of an obstacle, but not the block size. It bewilders some among the Core team, how devs with such little experience have commanded such a share of dialogue despite questionable experience. What’s more, reputable businessmen have banded together to support and pump these groups.


Below, in January 2016, Brian Armstrong states “the number of people supporting BitcoinClassic keeps on growing.” Well, this may have been true during the initial marketing push, of which Bitcoiners like Brian Armstrong and Roger K. Ver partook, but once the honeymoon was over people sobered up and here we are nearly one year later and BitcoinClassic inspired suspicion and doubt in a great percentage of Bitcoin participants.


Quote:[/url]

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[Image: zpSaUO-F_normal.jpeg]Brian Armstrong @brian_armstrong
The number of people supporting BitcoinClassic keeps on growing https://bitcoinclassic.com/ 
12:43 AM - 16 Jan 2016

Bitcoin Classic
Bitcoin Classic
bitcoinclassic.com



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A good anecdote about BitcoinClassic is when one member of the  team came on the Slack channel for the project to talk about his ongoing acid trip.


That dude even thought to go on his computer while tripping is terrifying enough. If you’re trying to lead Bitcoin as a member of your dreamt up vision of the future core development team, tripping on the job (unless you’re some whizz microdoser) is amateur hour status straight up.


Patience is a virtue. Bitcoin’s historical status quo has led to enormous gains for a largely a speculative technology. If Bitcoin doesn’t function as a transactional currency, that’s basically because it wasn’t designed as such in the first place (at a certain scale) and rushing to change it epitome of ego. If increasing the block size is the technologically sound thing to do, which makes sense, then that time will come. If it’s forced in a political shouting match, some dangerous eventualities become more possible, such as a coup. But, that will only be a problem for those that didn’t diversify their crypto-holdings.

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Blockchain development is seeing plenty of investment.

Blockchain technology continues to command a fair share of venture funding for fintech, one of the hottest venture capital (VC) targets worldwide. While the number of deals and the total value of fintech VC investment ebbed in Q3 2016, activity is expected to rebound in the fourth quarter and in 2017, according to a global analysis of venture fintech funding by KPMG and CB Insights.
The Q3 slowdown in VC fintech funding was due to the lack of $1 billion-plus mega-deals. The total dollars invested this quarter was also less than half of that in Q3 2015.


But despite the recent quarterly decreases, total fintech funding is on track to exceed 2015 totals.
Both the U.S. and the U.K. had weaker activity due to continued market uncertainty from the Brexit vote and the U.S. presidential election cycle.


Out of the three main global regions covered, only Asia saw an increase in VC fintech funding quarter-over-quarter, from $800 million in Q2 2016 to $1.2 billion in Q3 2016.


Blockchain Shows Strength
The blockchain fintech subsegment continues to show strength.
Bitcoin and blockchain investment activity peaked in the first quarter of 2016 with a total $153 million in 22 deals, then falling to $119 million and $87 million in the next two quarters. All but one of the first three 2016 quarters surpassed the $94 million in the 2015 third quarter.


The top Q3 2016 VC blockchain deals were Ripple with $55 million Series B, Coinbase with $10.5 million Series C-11, and Brave software with $4.5 million seed VC.

Payment technology VC investment activity fell sharply in 2016 from 2015 Q3’s $1.14 billion. In 2016, Q3 posted $475 million, the highest quarter for the year.


Ripple’s $55 million Series C investment was the fourth largest Q3 2016 payment technology investment and the only blockchain-related company to rank in the top four.


Among the top five payment technology deals in 2016, two were blockchain related: Ripple and Blockstream each received $55 million, making them the fourth and fifth largest fintech deals worldwide.


Payment Solutions Show Promise
The future remains bright for payment solutions.
Digital wallets and point-of-sale solutions continue to draw interest from tech giants, with ApplePay and Google’s Android Pay disintermediating banks for market share. Key concerns are maintaining good customer experience, rapid transactions and payment assurance, in addition to reducing merchant costs.


B2B and cross-border payments have not seen significant fintech investment, but change is coming. Fintech companies can insert themselves into existing processes to reduce friction across the value chain.


Emerging trends include cloud-based open API platforms for accepting digital payments and payment systems with richer customer data to automate processes.


Regulatory Initiatives Vary
Regulatory initiatives impacting fintech vary among regions.
European and Australian regulators are pushing a regulatory standard, while those in the U.S. have been encouraging change without pushing a specific mandate.


In Europe, the revised Directive on Payment Services (PSD2) offers benefits for fintech companies and consumers alike and opens the payments area to new competitors who use aggregated data to create ancillary payment services.


The U.S. has seen a recent push to modernize the payment system that includes the development of a real-time system that leverages the ISO 20022 global message standard.


Blockchain Strongest In North America
Blockchain technology has received the most VC investor attention in North America, where large financial institutions have invested in blockchain-related companies, announced partnerships to explore blockchain’s potential, or executed proof-of-concept activities.
Other large U.S. corporations are also taking an interest in blockchain technology, which is expected to grow over the next quarter.
The ability to move blockchain from proof-of-concept to adoption and production has been minimal, however. While the market continues to give blockchain companies opportunity to prove themselves, investors are becoming more concerned about results.
Over the next year, investors will assess the main fintech use cases and how long they will take to deploy.


Investor sentiment in fintech overall in North America remains positive. Enthusiasm for M&A, IPOs and liquidity may be lackluster in the fourth quarter, but 2017 should see momentum gaining.


M&A activity will be stronger as large financial institutions acquire startups and bigger startups merge with or acquire others.


Blockchain Rises In Asia
Blockchain is also playing a role in Asia, the market with the most VC Q3 2016 fintech backing.
Blockchain and other fintech areas are gaining more attention from VC investors in Asia because of their potential to traverse different markets. One blockchain company, Juzhen Financials, a blockchain post-trade solution, was among the top 10 Asian fintech deals of Q3 2016 at $23 million.


[Image: Singapore-Boosts-Its-Blockchain-and-FinTech-Sectors.jpg]
Singapore is a leading Fintech hub in Asia.

“Blockchain is becoming very hot as banks and financial institutions examine best practices and look closely at what international companies are doing in the space,” said Raymond Cheong, a fintech and innovation partner at KPMG China. “VC investors are putting a lot of money into small blockchain technology companies in Asia. Some very new companies are already into their second or third round of funding.”

Ian Pollari, global fintech leader of KPMG International, noted a lot of fintech diversification is taking place in Asia.
Fintech areas other than blockchain include data, analytics and RegTech. RegTech is gaining attention in jurisdictions with more mature fintech ecosystems, such as Hong Kong, Singapore and Australia.


Fintech companies include the following verticals: lending, payments/billing, personal finance/wealth management, money transfer/remittance, blockchain/bitcoin, institutional/capital markets, equity crowdfunding and insurance.

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FinTech solutions like bitcoin could bring significant respite to the unbanked in developing nations.

The Deputy Governor of the Bank of Japan, Hiroshi Nakaso, has revealed that there is no plan to issue digital currencies as a substitute for banknotes at the present time. Still, the official added the bank would “make utmost efforts” to understand and research blockchain technology, an innovation “born” with bitcoin in 2008, as stated by Nakaso.


The Deputy Governor was speaking [PDF] at the University of Tokyo – Bank of Japan Joint Conference in Tokyo late last week. He opined that blockchain or distributed ledger technology (DLT) presents significant potential to affect “money” and “ledgers”, the basic pillars for financial activities.


Financial Inclusion in Developing Countries via FinTech
Fintech models simulate positive feedback between finance and the economy, Nakaso stated, due to financial inclusion bought on by FinTech innovation.


He stated:
Quote:If people in developing countries gain new access to financial services through FinTech, they will gain opportunities to expand business such as e-commerce and e-learning, which are currently hampered by constrained access to payment services. In this manner, FinTech is expected to contribute to economic development.

 
Furthermore, the senior central bank official categorized financial technology into three separate types, namely blockchain, AI and big data, and smartphone innovation through massive adoption of devices in the past decade.


“In my view,” the official said, categorizing Fintech, “the first category includes ‘blockchain’ and LDT, which were invented in 2008 with the concept of “bitcoin.”

The cumulative use of these innovations could help establish a “virtual bank” without the need for any tangible infrastructure, the official added.


Pointing to blockchain, “born in 2008” with bitcoin as the “flagship technology” in Fintech, the official further opined that a majority of the efforts to implement the technology into real-world scenarios are still at an experimental stage.


Fintech advances could lead to a number of issues, the official added, particularly with regulation and taxation.

Quote:Moreover, if FinTech stimulates economic transactions through the internet and smartphones as well as business applications of DLT, it might become increasingly difficult to identify the physical “location” where transactions take place and the relevant ledgers are kept. This could lead to a variety of issues including those related to regulation and taxation.

The Mt. Gox Debacle
Nakaso highlighted the overlap that occurs when decentralized ecosystems like bitcoin see centralized trust, as in the case of users’ bitcoins stored among now-defunct bitcoin exchange Mt. Gox’s wallets.


“People tried to avoid the cost of managing keys accompanying decentralized-type information processing by entrusting their keys to a third party, Mt. Gox”, the official stated.


The eventual failure of bitcoin’s most-notable implosion is not the fault of bitcoin itself, but that of Mt. Gox, he said.

Quote:[T]heir (users’) trust was destroyed by the misconduct of the third party. In this regard, the problem of the Mt. Gox case did not stem from DLT itself but was similar to classic cases of misconduct in the financial industry.

No Timeline for Digital Currencies
The narrative of FinTech disruption and the ensuing financial inclusion that would boost economies and finance had the official address the obvious notion – would or perhaps when would central banks adopt digital currencies as a means to keep up with technological innovation.

Pro-digital currency advocates arguing for the Japanese central bank to issue its own digital currency claim reduced processing and storing costs, when compared to paper banknotes, Nakaso said.


While the Bank of Japan will “make the utmost efforts to deeply understand new technologies including blockchain and DLT,” the official added:

Quote:The Bank of Japan has no specific plan to issue digital currencies as a substitute of banknotes.

Despite the lack of a specific rollout plan, Nakaso’s revelations hint at a measured, specific effort by the central bank in a technology-forward nation like Japan, to consider digital currencies in the future. The bank will be cooperating with academics, he noted, to ponder and come up with solutions for important and significant questions in the face of a central-bank issued digital currency.
Such as:

Quote:For example, to whom should the central bank provide its account, as technological innovation changes the financial structure and the list of financial service providers? To what extent should the central bank provide “finality” to economic society? How should the information linked to payment transactions be handled?

The BOJ official’s comments come during a time when other central banks around the world are talking and even recruiting talent to help develop bank-issued digital currencies. The most notable endeavor of the kind is that of the People’s Bank of China, which has been researching the possibility of issuing its own digital currency since 2014, although the effort only became public knowledge earlier this year. Earlier this month, the PBOC, China’s central bank, issued a recruitment notice seeking applicants with expertise in blockchain technology development, cryptography and big data, a telling sign of the bank’s interest in fast-tracking its own digital currency, which it intends to do “as soon as possible.”

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The Krona could soon see its digital counterpart issued by the central bank.

Sweden’s central bank is reportedly considering the issuance of its own digital currency, ekrona, in an effort to address the significant decline of the use of cash in the country.


First revealed in a Financial Times report, Sweden’s Riksbank could introduce and issue its own digital currency before the turn of the decade. As the report reveals, Sweden has seen a rapid decline of the use of physical cash – both coins and notes – in recent times. Circulation has dropped by 40% since 2009, leaving Riksbank little choice but to come up with an alternative solution. A large number of Swedes have abandoned cash for cards and other forms of digital payments – apps, e-transfers etc – making it a notable candidate as a prominent cash-free society.


In a public release, deputy governor at Riksbank Cecilia Skingsley addressed the dire cash-adoption situation. Furthermore, the lack of a template or an example of a central bank-issued digital currency could make the endeavor a tricky effort.
 
She stated:

Quote:The declining use of cash in Sweden means that this is more of a burning issue for us than for most other central banks. Although it may appear simple at first glance to issue e-krona, this is something entirely new for a central bank and there is no precedent to follow.

 
Skingsley further revealed her personal preference to design the digital currency – similar to that of traditional currency in its properties. The ekrona would not earn any interest and would be designed in a way to not enable illegal activity. This means that the ekrona could be traced by the central bank, in some capacity.


As the FT report notes, the Riksbank first issued paper banknotes in the 1660s, making it the world’s oldest central bank to do so. The report also suggests that blockchain technology could be used as the framework for Riksbank’s If developed, the effort would prove a significant endorsement of blockchain technology, the innovation powering bitcoin, the most prominent digital currency around.


Skingsley’s comments, while relevant to Sweden’s case as a society that has already seen a tremendous decline in cash-usage, comes during a time when China’s central bank has publicly revealed its intention to issue its own digital currency. Earlier this year, the People’s Bank of China stated it is looking to develop and introduce it “as soon as possible.” The governor of the PBOC also opined that paper cash as a “last generation currency”, hinting that China would opt for blockchain technology .

The bank also issued a recruitment notice recently as a call to developers to help enable the design and issuance of its digital currency.


Ultimately, it’s a matter of addressing society’s preference in Sweden’s case, according to Deputy Governor Skingsley.


She stated:

Quote:The less those of us living in Sweden use banknotes and coins, the clearer it becomes that the Riksbank needs to investigate whether we should issue electronic money as a complement to the money we have today.

Sweden’s central bank is expected to make a call on its digital currency within the next two years, according to the report.

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Bitcoin and blockchains are not the only distributed computing models explored under the umbrella of technology. While Bitcoiners have claimed that “bitcoin is the currency of AI,” for instance, others don’t believe this is so. They, in fact, don’t believe they need blockchain to achieve some tasks bitcoiners believe only the blockchain can execute. Their systems include deep learning, evolutionary intelligence, and other novel programs.

Oh, and they don’t need to worry about block size debates. They scale.


A predominant fallacy in Bitcoin remains that the technology will change the world in various ways. While this very well may be so, it’s what’s called in legal terms ” a forward-looking statement.” These are very much frowned upon, considering the laws in various countries.


Dan Morehead, CEO of Pantera Capital, once parroted this common line which is as popular at least as “to the moon!”, another Bitcoin saying positing the currency might go to $1,000,000. “#Bitcoin will change the world…” he tweeted. He also suggests, implicitly or explicitly, how “hype” plays a large roll in Bitcoin’s evolution/adoption. Granted, Bitcoin very well may change the world, this line of reasoning is common with implying totally transform the world. Indeed, Bitcoin already has changed the world.


View image on Twitter

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[Image: Fgk0-Ttr_normal.jpeg]Dan Morehead @dan_pantera
1. #Bitcoin will change the world—just not overnight, over years. @Gartner_inc’s Hype Cycle: http://bit.ly/miamipresentation …
6:40 AM - 25 Feb 2015


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Bitcoiners, as cultural tribes generally do, tend to look down on skeptics, critics and general outsiders.
High financial institutions investigate how blockchain technologies might affect their industry, but they theoretically have a menu of distributed computing techs from which to draw. These solve consensus, scalability and other problems differently than Satoshi Nakamoto did.


A large part of Bitcoin’s worth is thanks to a genre of computer science called distributed computing. Networked computers, in distributed systems, communicate and coordinate programs through relayed messages secured by various means. The orchestra of computers come together to compose a symphony of some executed protocols. To be more exact, Bitcoin is a sub-genre of a sub-genre. Distributed computing > Peer-to-peer apps > blockchain > bitcoin (bitcoin is the first – maybe even ultimately the best? – use-case of blockchain). Indeed, the beautiful part is all of these knowledge systems can be combined.


Other distributed systems include SOA-based systems (service oriented architecture where software is executed over a communication network such as the simple task of retrieving credit card statements online) and multiplayer online games.


Distributed computing means various machines interact with each other to solve some sort of problem or achieve some goal. All these different machines must be concurrent and they mustn’t deploy a synchronized clock (meaning all machines must be on the same time). The network must also be so robust that “weakest links” throughout the network don’t present a formidable risk to the system.


Distributed computing and blockchain are not at odds with each other. Bitcoin’s mining and security apparatus is pretty novel, and has inspired much discussion. Thus, distributed computing and blockchain are harmonious solutions to important technical problems. Perhaps Bitcoin’s most unique component is its public-deployment. Many models developed under distributed computing components are propriertary information, and the ‘magic sauce’ can’t be known by you or I like you or I can get to know Bitcoin.

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Not much has transpired in the Bitcoin space since yesterday.  There was a minor selloff, but that was not completely unexpected, given that the chart is moving through an arc pair on the daily chart (3rd).  I suggested yesterday that the 1.732 extension from the pitchfork would probably hold, and so far it has.  Here is the daily chart with the long term setup displayed:





While I’m sure most Bitcoin traders would rather there were no consolidations ever, they are a fact of life.  As I have repeated many times, when pricetime exits the arc pair on the sunny side, we will get a buy signal.

Here is the same chart with a shorter-term setup:





On this chart, which we saw yesterday, price is trying to get through the 4th arc pair.  So far, it has been unable to get a close within the pair, but I suspect it will, in the near future.
We also looked at a pitchfork yesterday, and noted how pricetime was being contained within the 1.414, 1.618 and 1.732 extensions.  Lets look at that 8-hour chart again:





As I type these words, the 1.732 support is holding.  Is there another selloff coming?  I wouldn’t rule it out, because as long as pricetime is within the arc pair anything can happen.  One arc is support and the other is resistance.

Ethereum
Ethereum is also treading water today, STILL unable to break free of the 3rd arc pair on a long-term daily chart.  Let’s take a close-up of that chart:





This arc pair has been tenacious in it’s grip, but it looks like it might be losing it’s grip, as today’s candle is outside the arc pair at the moment.  It’s too soon to declare victory however, as the market could still close down sharply in the next 10 hours, bringing price back within the arc’s confines again.  But in any case, this selling season is coming to a close soon, I believe.

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Goldman Sachs, one of the earliest members of the R3 blockchain consortium has reportedly chosen not to renew its membership with the working group.


In a report by the Wall Street Journal, investment banking giant Goldman Sachs has elected to let its R3 membership lapse and stopped being a member effectively as of October 31.


The exit is notable following a steady influx of members that includes banks, insurance giants and technology firms that have – over the past year – added to R3’s member banks. Still, a spokesperson for R3 played down the significance of the exit, stating that member departures are to be expected.


Speaking to the Journal, the spokesman said:

Quote:Developing technology like this requires dedication and significant resources, and our diverse pool of members all have different capacities and capabilities which naturally change over time.

 
Goldman Sachs’ exit comes in the days following R3’s announcement that it’s blockchain software Corda, developed over time among its members and the startup, is to go open-source.


Throwing a hint for a possible reason behind the separation, the WSJ report also reveals R3’s efforts to seek equity investment from its members, in return for a stake from proceeds of future implementations of its blockchain solutions.


Still Big on Blockchain
Despite its exit, Goldman Sachs continues to be heavily involved in blockchain development and research. Further, its involvement in other blockchain initiatives and projects could simply mean an increased focus on its own blockchain-based objectives specific to its core processes. The bank is a notable investor in possible R3 competitor Digital Asset and has filed multiple payments for its own cryptocurrency and a blockchain solution for foreign exchange trading.


In early 2015, the bank was the lead investor in a $50 million funding round in bitcoin startup Circle. Furthermore, a research note sent to its clients had one Goldman Sachs analyst stating “the blockchain, can change…well everything.”

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Sberbank has also revealed its interest in joining the R3 blockchain consortium.

While Russian authorities and officials have frequently poured scorn on bitcoin and digital currencies, going as far as to craft laws aimed at criminally prosecutingadopters and miners, the head of Russia’s largest bank has revealed that he has owned and exchanged bitcoins for fiat currency.


Herman Gref, CEO and chairman of the executive board of Sberbank, Russia’s largest bank by assets has, in a public talk, spoken to the benefits of virtual currencies while opining how they will soon permeate into society, as reported by Russian news agency TASS.
Speaking at the presentation of a joint educational project between the bank and Google, Gref also revealed how he used virtual currencies by speculating their value and exchanging them into fiat currencies, back and forth.
Roughly translated, Gref’s reported statements read:

Quote:Now, there are more and more virtual currencies [as well as] virtual currency exchanges. I have easily exchanged virtual currency into regular [fiat] currencies and so on so forth, with pleasure.

He continued, stating:
Quote:I had a few bitcoins, I did not like the value [at the time] and I put them on hold and said when they reach a certain value, please, convert it into rubles and dollars. Two and a half months later, I noticed that [Bitcoin had taken] such a course and I took the conversion.

 
Deeming it a ‘game’ with returns on bitcoin, a habit inherent among casual and serious investors around the world who are turning to bitcoin as a store of value, Gref added:

Quote:This is of course, a great pleasure and a nice game but soon, it will be our whole life.

 
Gref is notable for his straightforward publicly-revealing stance on digital currencies, having previously criticized Russia’s proposed bitcoin ban. Such a measure would hinder Russia’s development of blockchain technology, according to the banking executive.

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Humans are social creatures and society is based on interpersonal trust relationships. If you hear from the CEO of an oil company that global warming is not a man-made phenomenon, you may believe that he might be biased, and such information would be taken into account in deciding whether or not to take him at his word. By the same measure if you read an article on Cointelegraph that recommends the Stellar Consensus Protocol, you would be favourably disposed to investigate it, because you know that the author of the piece is a highly cultivated gentleman and a distinguished scholar. We weight the value of the information we receive by the degree to which we trust the source of that information. This is a remarkably effective heuristic for filtering through the deluge of information that seeks to DDOS our senses in the digital age. 

The world’s most cited scientific journal is titled Nature, because ideally the goal of science is to discover and utilize fundamental characteristics of the natural physical world and universe. The Stellar Protocol recognizes the natural information provenance heuristic described above and applies it in an ingenious way to the manufacturing of consensus in a distributed system.


It just so happens that the information provenance heuristic is the selfsame one that the author of this article used in his initial evaluation of Stellar. Blockchain transaction networks are distributed systems, so one would expect that the knowledge required to create the file sharing platform eDonkey, would serve as a solid foundation to bootstrap one’s appreciation of cryptocurrency systems. The world’s first Bitcoin exchange is associated nowadays with chicanery and malfeasance of the highest order, however that was mostly the work of “MagicalTux” a.k.a. Mark Karpelès. Before Mt. Gox imploded, it was the brainchild of Jed McCaleb who began the exchange after having created eDonkey. McCaleb sold Mt. Gox to Karpelès in 2011. Subsequently McCaleb conceived the idea of the Ripple payment protocol, one of the undisputed darlings of the Blockchain ecosystem with multi-million dollar venture funding rounds under its belt and large global financial institutions among its list of satisfied customers. This is interesting pedigree and with knowledge of the history of the organisation, and when one is made aware that McCaleb is also a co-founder of the Stellar Development Foundation, it might provoke one to consider Stellar more closely.


Even if McCaleb was the sole operator of Stellar, that would have been enough to peak the curiosity of most people, however, Stellar also has Professor David Mazières in the role of chief scientist. At Stanford University, Mazières leads the Secure Computer Systems Group and if these qualifications are not enough to convince you to take a look at Stellar, Mazières is also a past master in the subtle art of UX, as is evidenced by his phenomenal personal website.


Now that you know a bit about Stellar, and your information provenance heuristic has been satiated, the next logical question that comes to your mind is “how can I interact with Stellar myself?” - fret not - in that regard we also have you covered.


Stellar aims for the stars, and the nearest star system to us is Alpha Centauri! The next step towards getting there is a functional app for sending and receiving payments with Stellar. Centaurus is the first wallet application build for deployment on the Android platform and was recently awarded best wallet in the Stellar Build Challenge.


As the ecosystem around the Stellar network continues to grow and flourish, it will be interesting to see how the system develops. The information that you decide to propagate to the nodes in your social network, and what you choose to say to those nodes that trust your personal judgement, will have no small part to play in that story.

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Deloitte has revealed that it has integrated with Stellar, financial platform developers, to build a cross-border payments application. Designed to serve two customer segments, consumers and businesses, the Deloitte Digital Bank launched at the Consensus conference in New York in May 2016 and is now available to power instant payments across borders.
Consumers can use the Deloitte Digital Bank mobile application, which is available on iOS. With the mobile app, users create an account by scanning their driver’s license and can make instant peer-to-peer payments. Businesses instead access the Digital Bank through a web portal. The B2B product supports all of the features business payments require, including invoice tracking and reference numbers. All transactions resolve in around 5 seconds.
Thomas Jankovich, Principal at Deloitte, commented: “Banks are eager to replace the legacy systems of of ACH and SWIFT. With all of the friction involved in sending payments—3-7 days to resolve transactions, high fees—we can erase those pain points using cutting-edge technology now. We’ve seen interest from the top United States banks, and interest abroad.”
By this time next year, Deloitte estimates that they will have launched a product in partnership with a financial institution. With a sales team of 250, Deloitte will spend 2016 investing in relationships with financial institutions around the Digital Bank product. In keeping with the Stellar.org roadmap, Stellar.org will continue to help consulting firms and financial institutions solve big problems.
Co-founder and CTO of Stellar.org, Jed McCaleb said: “We’re excited a team with such prestige and expansive reach has integrated with Stellar,”

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Michael del Castillo (@DelRayMan) | Published on June 30, 2016 at 16:45 GMT

[Image: jed-mccaleb-delcastillo.jpg]
Stellar co-founder Jed McCaleb hit a roadblock in his mission to serve the global underbanked when earlier this month his co-founder resigned, leaving him with her responsibilities, including more frequently engaging with the public.
For a computer programmer whose career has been largely under scrutiny since hefounded defunct bitcoin exchange Mt Gox, the idea of taking on a more public role at Stellar was intimidating. But, he says it was a necessary step for the startup.
After years of building a payments rail system designed to make it cheaper to offer banking services to developing nations, McCaleb said it was time for him to make the case that Stellar should be considered a leading blockchain platform for enterprise customers.
McCaleb told CoinDesk:

Quote:"We've spent the past two years building a product, and now we're showing it to the world."

Founded in 2014 after McCaleb and his then-girlfriend and co-founder Kim left another startup he founded, Ripple, the two companies have always been equated in the blockchain community, despite their differing business models.
Stellar has raised a little over $3m from Stripe to build a new distributed ledger payments rail similar to Ripple’s, but aimed specifically at serving clients in developing nations.
In contrast, Ripple has raised more than $38m from investors as diverse as Andreessen Horowitz and Santander.
Barclays in South Africa
In his first public appearance, McCaleb spoke onstage at the Exponential Finance conference with Barclays Africa's CEO of corporate and investment banking, Stephen van Coller.
In interview with CoinDesk, van Coller described how his company is testing its prototype on the Stellar payments rail at a high school in Johanessburg, South Africa. About 100 students aged 16-years-old to 18-years-old are currently testing a minimum viable product (MVP) designed so feature phones can be used to pay for goods.
To be profitable in Africa, where the margins per customer are small, van Coller says they’ll need to be able to reach massive scale, serving customers that conduct few transactions, for smaller amounts than in more developed regions.
Coller said that to reach such efficiency his team searched for a scalable service that didn’t use existing payments rails "because that’s where the cost is today".
But even with a streamlined onboarding process and more efficient back-end, Coller believes the work with Stellar alone won’t be enough to serve Africa’s unbanked population.
Coller said he is currently in conversations with other financial institutions interested in financial inclusion.
"Our belief is that this needs to be an open platform, rather than run by just a single bank," he said. "Every government should be building this. They should be building cheap payment rails within their country."
Wholesale with Deloitte
But, Barclays isn't the only bank interested in Stellar.
In May, consulting firm Deloitte announced that it was using the startup's technology to build a blockchain-based service for a bank outside of North America, but it didn’t share the name of the bank or in which region it is based.
In conversation, Deloitte Digital principal Gys Hyman revealed more about how his company has worked with Stellar to build a prototype for retail transactions. Specifically, Hyman said Deloitte is using the Stellar payments rail to build a prototype aimed at wholesale transactions that must reliably move with additional information, including invoice numbers and tracking numbers.
Throughout the construction of the prototypes, Stellar’s role has changed, according to Hyman.
While Stellar played a very hands-on roll during the creation of the retail prototype, Hyman said the startup is now more involved with oversight and quality assurance.
Hyman says there are now other customers, "mainly banks" with which he is currently in discussions, adding:

Quote:“From a Stellar integration point, we’re ready. If a customer were to come to us tomorrow, we’re ready.”

One country at a time
As part of his increasing presence in the public eye, McCaleb has spent the past two weeks touring around Nigeria to visit with partners and demonstrate the new technology.
Otherwise, he said the company's strategic plans are unchanged.
In May, Stellar published a company "roadmap" for how it plans to achieve its goal of serving theroughly 2.2 billion people in Africa currently without adequate banking services, one country at a time.
"We're mainly focused on Nigeria because I think it’s important to start in one particular region and achieve ubiquity there," said McCaleb. "Because we’re starting a network and you need to be able to send money to people you know."
The first phase of the roadmap, to build a codebase for developers, was completed last November. The second phase, to integrate with money services providers licensed in each nation, was formalized on Tuesday with a challenge aimed specifically at attracting banks and licensed money-service transmitters.
The third phase is to bring the product to end users.
McCaleb told CoinDesk that this means Stellar will continue to eschew the sort of high-value, developed market use cases that have attracted his peers in the blockchain space.
He concluded:

Quote:"I think that one of the most powerful things that this technology is going to do for the world is actually get everybody into the same financial network."

Read More Read More, Posted by: zizicz
Stellar Protocol's Stellar Build Challenge encourages developers to build applications using the platform and win attractive Lumen rewards.
[Image: stellar-integrator-825x400.png]

As the Stellar ecosystem continues to grow, creators of the blockchain based financial platform have decided to further strengthen the codes by leveraging the power of the crowd. The Stellar Protocol has announced the launch of its Stellar Build Challenge where they encourage the developer community to build new products on the platform.
According to Stellar’s recent release, the Stellar Build Challenge will be divided into four categories – Anchors, Applications, First-time Submissions and Exchanges. Each of these categories will have their own awards, granted to the submitted projects upon review by a panel of jurors. The announcement about Stellar Build Challenge comes right before the platform’s Bitcoin-Lumen giveaway program, which is expected to begin early next month.
The Bitcoin-Lumen program will see Stellar offering its Lumen crypto-tokens to the Bitcoin community for free. The amount of Lumens offered to Bitcoin holders will be equivalent to the percentage of total bitcoin held by the bitcoin user at the time of the program’s launch. Stellar will be publishing a snapshot of the Bitcoin blockchain, with the record of bitcoins stored across the wallets. The unclaimed Lumens left behind after the program’s completion will be used to fund the Stellar Build Challenge awards.
The Anchor category will include banks, licensed money service providers and mobile money operators that use Stellar network to accept deposits, issue credits and honour withdrawals. Application categories will include apps like wallets on built on Stellar network. Similarly, the Exchanges category will include exchange platforms supporting Lumen trading. Each category has different award slabs as listed below.


   
In addition to these awards, First-Time submissions will be eligible for quarterly rewards of 200,000 Lumens. The submissions will be verified to ensure that they meet the defined criteria before the payout.
Jury
The jury members along with their Stellar Slack handles are listed below.
– Cheng Kuan @lab
– Johan Stén @dzham
– Eno Han @eno
– Christian Rudder
– Tim Akinbo @takinbo
Developers have to submit their open sourced GitHub account containing their applications built on the Stellar platform to gain entry into the Stellar Build Challenge.
The submissions will be judged in the middle of September and the results are slated to be announced by the 1st of October.

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Stellar said it would grant awards in categories: Anchors, Applications, Exchanges and first time submissions.

Stellar, the non-profit cryptography protocol to connect financial institutions, is awarding large amounts of its native currency, lumens, to the winners of the Stellar Build Challenge. In order to foster creativity within its ecosystem, Stellar said it would grant awards in the following four categories: Anchors, Applications, Exchanges and first time submissions.

Anchors are either banks, licensed money-service providers or mobile money operators that accept deposits, issue credits, and honour withdrawals on the Stellar network – vital to the success of the Stellar network.



The conditions for qualifying as an anchor or as an exchange and the amount of lumens being distributed for each challenge are listed in this blogpost.

Stellar CEO Jed McCaleb told IBTimes: "We are hoping to kickstart the Stellar ecosystem and it seems like awarding people with the lumens is a good option. We want people building on Stellar who are stakeholders, who are participating on the network.

"This way the lumens will go to the people who are actually building stuff, which I think will ultimately benefit the whole ecosystem down the line much more than just people that have a bunch of money.

[Image: cryptocurrency.jpg?w=400]

Stellar is offering millions of dollars worth of native currency lumens to the best builders iStock

"Stellar is this brand new platform and there are all kinds of things that will be built that we don't yet anticipate. Obviously there are exchanges and anchors and wallets, but beyond that I think there are a lot of innovative applications that we just haven't even thought of. It does enable a lot of use cases that were just not possible before."

McCaleb pointed out that this is a large community and the awards amount to quite a bit of money – two or three billion lumens is in the millions of dollars.

The lumens for first time submissions (originally dubbed Community Benefit awards) will be funded by any unclaimed lumens from the Bitcoin-Lumen Program. This aims to find ways to develop services that are fair, affordable, and community-driven, and at the same time drive uptake of the Stellar network to maximise efficiency and reach.

McCaleb added: "The idea is, that I think it is unlikely Satoshi will claim his lumens. So there will be a lot of lumens that are unclaimed with that, so rather than just putting them all back into Stellar.org, we thought it would be cool to do this novel thing. And if it's interesting to people, we will just kind of keep it going."
The first round of winners will be announced on 1 October 1 2016.

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[Image: Leaving-300x185.jpg]

One of the co-founders of digital currency payment network Stellar has announced her resignation.
In a statement published to her personal blog, Joyce Kim said that she would be “passing on the torch” of executive director to her co-founder, Jed McCaleb, who co-founded Ripple and was the original owner of Tokyo-based bitcoin exchange Mt Gox.
Though resigning from the executive director post, Kim said that she would continue in her capacity as chairperson of the startup's board.
In the blog post, Kim indicated that slow-moving legal changes in the financial industry and increasingly specialized product design played a role in her decision. But she added with a hint of optimism that her work abroad in micro-finance would impact her involvement with future projects.


Kim wrote:
Quote:"I count myself lucky for this experience as there are very few times in our careers when we design products beyond the tech-included demographic. I want to take these learnings with me to other parts of our ecosystem as well."
Looking back
Kim and McCaleb founded Stellar in 2014 with the aim of helping to facilitate low-cost transactions for users that lack access to traditional payments channels. Early on, the project positioned itself as geared toward the world's underbanked in developing regions.
As its basis, Stellar used a fork of the original Ripple consensus algorithm that was later altered following network issues.
Stellar would find itself the subject of controversy after its founding, when a lengthy report in theNew York Observer offered a take on Kim's and McCaleb's exit from the Ripple project.
Stellar would ultimately be drawn into a legal dispute between Ripple and several other parties over roughly $1m in disputed funds. Earlier this year, the dispute was resolved when those funds were released to Stellar.
A new beginning
Last month, McCaleb posted a roadmap for Stellar's future, focusing on an effort to provide payments connectivity in Nigeria. The initiative involves a developer-ready platform for building apps and the establishment of partnerships with financial institutions in the African country
Kim says she plans to take the summer off to “think, read, and reflect” on her next steps during an exploratory trip that will include visits to Ecuador, Sweden and Spain. She said expects to return by the end of this summer.
Kim concluded her post:
Quote:"I will return from my travels bursting with energy, ideas and likely a dinged up surfboard."

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