QuadrigaCX's latest

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February 13, 2019 103 BITCOINS: Beleaguered Canadian crypto exchange QuadrigaCX accidentally lost 103 bitcoins – worth nearly $500,000 CAD or $378,000 USD – when it transferred the coins to a cold storage wallet it cannot access. According to Ernst and Young, a court-appointed monitor for the exchange, the mishap occurred last week. “On February 6, 2019, Quadriga inadvertently transferred 103 bitcoins valued at approximately $468,675 to Quadriga cold wallets which the Company is currently unable to access. The Monitor is working with Management to retrieve this cryptocurrency from the various cold wallets, if possible,” the monitor wrote in an initial report. The mistake is only the latest issue for the exchange, whose CEO and founder, Gerald Cotten, died in India late last year. According to a previous court filing by Quadriga, Cotten was the only member of the team to know how to access its cold storage wallets, meaning the majority of its crypto holdings were frozen. While the exchange did not break down how much of its holdings were in hot wallets compared to cold storage in its initial filing, Tuesday’s report indicates that less than $1 million CAD ($682,000 USD) were in the hot wallets, meaning $179 million CAD (about $136 million USD) are frozen. Full Story PAYMENTS PLAY: Mitsubishi UFJ Financial Group (MUFG) – Japan’s largest financial group and the world’s fifth largest bank by assets – is launching a blockchain-based payments network next year. The firm said Tuesday that it has formed a joint venture with U.S.-based fintech firm Akamai Technologies to develop the platform “by the first half of 2020.” Called the Global Open Network, the system will be capable of processing over a million transactions per second, MUFG claimed. The firms are also looking to integrate internet of things and Akamai’s cloud platform into the network. The new venture launches with capital of 250 million yen ($2.26 million), with MUFG having an 80 percent stake and Akamai the remaining 20 percent. The platform was initially announced back in May. At the time, Akamai said it would provide a number of services, including current payment processing, pay-per-use, micropayments and “other developing IoT-enabled payment transactions.” Full Story SETTING STANDARDS: The Enterprise Ethereum Alliance (EEA) is boarding the tokenization train. The 385-member standards body plans to form a “token task force” this year, executive director Ron Resnick told CoinDesk. The group will work on a specification for tokens that run on top of ethereum and private blockchains based on it, with business uses in mind. Notably, the task force will do this not only for assets whose units are interchangeable with one another (such as shares in a corporation, or blockchain representations of fiat currency), but also for individual tokens with unique properties (with CryptoKitties being the most famous example, although a more plausible business application would be digital certificates for diamonds). "We are creating a token task force; we will do that first half of this year," Resnick said. "It's going to be focused on support for fungible ERC-20 and non-fungible ERC-721 tokens." Crafting a business-grade spec for tokenization could ease corporate adoption of the technology, whose main use case to date has been fundraising by startups, often in a legally dubious manner. “We want to create a token specification standard for enterprise tokenization so basically [assets] can be managed in a much better way with more assurance than what's happening today,” Resnick said. Full story Every quarter, CoinDesk Research takes stock of the key data, trends and events with its State of Blockchains reports. As our research efforts evolve and expand, we hope to provide amplification to a variety of perspectives within the crypto community. We reached out to analysts, builders, and lawyers to understand the industry from their unique vantage point. Check out the full article, but here's a sample insight: “Q4 2018 was quietly one of the most interesting times to be in Bitcoin. As the price dropped, so did its importance in the conversation. We started to see more philosophical questions on Bitcoin emerge. Discussions regarding POW vs POS, Big Blocks vs Small Blocks, On-chain vs Off-chain Governance became mainstream… The average crypto user will be more comfortable with hardforks & network upgrades as we can assume all forks that can exist, will exist. Bitcoin will be defined as the sum of all forks. I believe the most exciting future developments are in Bitcoin-As-A-Computer. As more developers enter the space and actively build applications that store, manage, and run data on-chain, we will see exponential progress in what I believe is the first true “World Computer”. The implications of this are incredibly far reaching. Regardless of what happens in the near term, this is one of the most exciting times to be building in the space. I look forward to a Bitcoin future.” — Elon Moist (@coinyeezy), adviser at Honeyminer. We want to hear your perspective too! Do you have thoughts on the crypto industry? Do you want to add to the conversation? Do you want to help shape the direction the ecosystem moves in? If the answer is yes, please fill out our survey. We will be releasing the results in the coming weeks with tons of insights that you can help provide. For an in-depth view of crypto data, you can also check out the CoinDesk Crypto-Economic Explorer here. TOUGH HURDLE: Bitcoin's repeated failure to beat the 50-day MA resistance has weakened the bullish case. As a result, the bears may hit the market with fresh offers if the hurdle remains intact for another 24 hours or so. However, a move above $3,730 would confirm an inverse head-and-shoulders breakout on the 4-hour chart and open up upside towards $4,000. Full Story   BEST OF THE BEST   MARKETWATCH: Overstock founder and CEO Patrick Byrne has argued that government services need a revamp and blockchain provides the means to do that.   Byrne told MarketWatch that he’s looking at building government-as-a-service – “a set of applications and companies that, between them, can bring blockchain to different services that governments provide.” That would potentially make governments more efficient, less costly to run and “incapable of being bribed,” he added. “We could step into Venezuela with six laptops and create not only a functioning society but arguably one with the most advanced government systems in the world,” Byrne said.   Overstock subsidiary Medici’s land-governance service has already titled almost 50,000 properties using blockchain tech in Zambia, he continued, and the government has authorized a further 300,000 homes. “We anticipate doing the whole country,” he said. THE REST   CONSULTANCY.UK: A new study from marketing consultancy Simon-Kucher & Partners suggests that blockchain could create a global market for added services in the auto industry of over £90 billion in the next 10 years, as reported by Consultancy.uk. Drivers, it found, would be willing to pay more for services such as traffic congestion management and automated payments. In the survey, participants said they were particularly interested in services that can save them time. Solutions that reward good driving, such as with lower insurance costs, were also popular, with 11.7 percent supporting the option. Just over 10 percent were interested in financial rewards for eco-friendly driving.   Making life easier behind the wheel was also popular. 27 percent said they would pay around $11 every month for traffic congestion management services. While 12 percent would fork out $8 for remote control of the vehicle, with features such as locking and unlocking. Automated payments that take the hassle out of tolls and paid parking were of appeal to 17 percent of the study group, who said they’d pay over $6 for the service. Seven percent also said they would pay around $5 for an immutable record of an auto’s history; for example, when buying a used car.   BLOOMBERG: Galaxy Digital founder and former hedge fund manager Michael Novogratz believes the crypto space will see a large influx of cash from major institutions over the next year, Bloomberg reports.   In an interview with Bloomberg Television, Novogratz explained that "all the architecture that institutions need to feel comfortable with this is being put in place," and he expects custody services to come online over the next month and a half.  Fidelity is one such example. The trillion-dollar asset manager plans to launch its digital asset custody service, and Novogratz thinks there are as many as 300 potential customers interested in using the platform.  “Over the next six to 12 months you are going to see institutions put a small amount of their assets … [and] a small amount of institutional assets is a lot of money,” he said. WHO WON #CRYPTOTWITTER Copyright © 2019 CoinDesk. All rights reserved. Our mailing address is: 250 Park Avenue South New York, NY, 10003, US Want to change how you receive these emails? You can update your preferences or unsubscribe from this list

An uncommon lifeline 😳

February 13, 2019

ARCHIVE

QUOTE OF THE DAY

"It's bigger than the Iron Age, the Renaissance. It's bigger than the Industrial Revolution."

- Tim Draper

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MARKET

COIN	PRICE	24H
BTC	$3,627.56	- 0.21%
ETH	$122.18	+ 1.22%
XRP	$0.303111	+ 0.34%
EOS	$2.85	+ 1.16%
LTC	$41.59	- 3.39%

*Information as of 10:00 AM EST

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REVIEW

Selling Crypto Derivatives Could Help Keep the Lights On

Cash is tight for many businesses in the space that had majority of their liquid assets tied in cryptocurrencies.

As the value of the tokens fell, so did their runways, and operations are slimming down to accommodate the problem.

But now some businesses are getting creative and actually betting against their own assets to generate cash in the short term.

Here's the trade

Companies bet the price of Bitcoin (or another digital asset) will stay below a certain price level after a certain time period.

If it is below that price level, the company is paid in cash and gets to keep its digital assets. Meanwhile if the price goes above, the company is forced to sell its digital assets to compensate the trade.

In short, it's like a covered call option.

A very special covered call…

While Bloomberg reports the trades are happening with Wall Street pros, there is no public solution for this type of trade in crypto yet.

Actually, companies are negotiating their own terms with financial firms to take these trades and hopefully, find some short term cash.

QCP Capital, a firm facilitating the trade, worked with an ICO project last month to create a three-month contract. Anything Bitcoin price above $4,200 at expiry, the ICO liquidates its 250 Bitcoin to pay, anything below $4,200, the ICO gets $66,250 in its bank account.

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EXCHANGE

Cryptopia is Getting the Green Light from Regulators but Stays Offline

Following a hack that resulted in up to $23 million worth of cryptocurrencies lost, New Zealand-based exchange Cryptopia is getting the green light from regulators to continue operations, but it continues to stay offline.

According to a report from The New Zealand Herald, local authorities are no longer preventing the exchange from relaunching as the exchange now has full control of their systems and facilities.

Still, however, the company's website remains offline and social media accounts have remained dead since January 28th.

Looking forward

It's unclear whether or not the exchange has plans to reopen as Cryptopia founders didn't respond to the Herald for comment.

That seems to be a recurring theme during this time since the exchange has released relatively little details about the hack and whether or not they will refund users.

For now, victims of the hack are anxiously waiting for their assets to be returned with a possible joint lawsuit of more than 40 traders already brewing.

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ANALYSIS

Ethereum Daily Mining Rewards are Dipping to Lowest Levels Ever Reported

According to Etherscan, new Ether (ETH) is being mined at its lowest level ever reported.

The chart shows only 13,370 new ETH being created on February 10th while previous levels hovered around 19,000 ETH at the beginning of 2019.

The reason? A spontaneous spike in mining difficultly that propelled the metric 19% in one day.

Difficulty bomb delay

Still, the difficulty is nowhere near the so-called "difficulty bomb" that is looming over the network as developers work to delay it.

The feature was put in place to deter miners from continuing on the network even after the Proof of Stake algorithm takes place.

But this algorithm change won't come so soon. Already the difficulty bomb has been delayed and will be delayed again later this month as Ethereum's hard fork Constantinople gets activated.

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BITS

But wait, there's more...

• 🇰🇷 South Korea's largest foreign exchange bank has filed up to 46 blockchain-related patents.
• 💰 Mike Novogratz claims Bitcoin will replace Gold since "Sovereignty costs a lot."
• 💳 Binance adds credit card purchasing for XRP tokens.

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MEME

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	Listen now (4 min) | Substack is introducing a new audio tool and I thought I'd give it a try. You know, do something different, let you all hear my voice. Love it? Hate it? Leave a comment down below and let me know what you think. Note 1: Bloomberg article ( Source ). Forbes article ( CoinSheet Audio (Feb 12, 2019) Click below to listen to the episode: Listen now © 2019 CoinSheet LLC Unsubscribe 427 N Tatnall St #84981 Wilmington, DE 19801 A Substack newsletter

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February 12, 2019 HARD FORK V2: The ethereum community will try executing its system-wide upgrade, Constantinople, for a second time later this month. The hard fork was previously scheduled for mid-January, but was postponed after the discovery of a critical security bug in one of the upgrades.  Now, developers are confident that the hard fork can proceed on schedule. Hudson Jameson, who handles developer relations for the Ethereum Foundation, told CoinDesk that “the block number has been set and [the upgrade] is hard coded in the clients now so it’s going along fine.” The hard fork in a few weeks will actually consist of two separate upgrades executed simultaneously. The first, Constantinople, will launch all five Ethereum Improvement Proposals originally planned, while a second, dubbed Petersberg, will roll back EIP 1283, the source of the security flaw.  EIP 1283 is still being included in Constantinople due to the fact that many ethereum testnets, such as Ropsten, already activated the hard fork weeks before the bug was discovered. Developers determined it would be easier to roll back the upgrade than create a new hard fork package which excluded it. Full Story XRP INCENTIVES: Silicon Valley fintech startup Ripple goes out of its way to say it didn’t create the cryptocurrency XRP. But that doesn’t mean the company doesn’t rely on its vast reserves of the token when courting prospective hires. One engineer who asked to remain anonymous showed CoinDesk a recruiting email from late 2018 that promised an XRP package from Ripple worth up to $3 million, in addition to a generous salary offer. Salaries may vary according to seniority, but based on conversations with two prospective recruits, XRP bonuses for engineers generally range in value from $1 million to $6 million, according to the company’s own evaluation. As of press time, XRP is trading at roughly $0.30 per token. Ripple declined to comment on bonus packages, including whether they are still being offered in 2019. One former employee noted generous equity deals are standard in Silicon Valley. A company representative did say that Ripple added 100 new employees across the company in 2018, adding: “We move fast to acquire the best talent out there – especially considering the highly competitive nature of other startups who want to hire similar candidates.” Full Story JACK O'LIGHTNING: A bitcoin scaling solution called the lightning network may soon come to Square’s Cash App for mobile payments. Twitter and Square CEO Jack Dorsey, an investor in the bitcoin-oriented startup Lightning Labs, recently announced during an interview with podcaster Stephan Livera that there are plans to integrate the scaling technology with Square’s mobile app. “It’s not an ‘if,’ it’s more of a ‘when,’ and how do we make sure that we’re getting the speed that we need and the efficiency,” Dorsey told Livera. “We don’t think it stops at buying and selling [bitcoin]. We do want to help make happen the currency aspect.” Full Story ORACLE'S DOZEN: Despite years of hype and chatter, enterprise blockchain deployments actually in production are few and far between. But according to Oracle, the list just got a little bigger. Announced Tuesday, the software giant now has up to a dozen enterprise customers using live applications that have sped into production since its cloud-based blockchain platform went live last July. This includes a cargo tracking consortium called the Global Shipping Business Network (GSBN); China Distance Education Holdings, which shares educational and professional certificates; Circulor, which tracks conflict minerals; and SERES, a solution for dealing with invoices between franchisors. Oracle said other customers are at the production stage, including Arab Jordan Investment Bank, Certified Origins, NeuroSoft, TradeFin, HealthSync, OriginTrail, ICS FS, SDK.Finance and Nigeria Customs. Frank Xiong, group vice president of blockchain product development at Oracle, told CoinDesk: “Other vendors may still be experimenting, but we do have real customers in live production. I would say around 10 to a dozen are in a live situation.” Full Story Every quarter, CoinDesk Research takes stock of the key data, trends and events with its State of Blockchains reports. As our research efforts evolve and expand, we hope to provide amplification to a variety of perspectives within the crypto community. We reached out to analysts, builders, and lawyers to understand the industry from their unique vantage point. Check out the full article but here's a sample insight: "Q4 2018, also known as the great crypto-winter, saw an interesting shift in narrative and dialogue. While some in the industry continue to rail against regulatory interference, others applaud the possibility of regulatory acceptance with the introduction of the token-taxonomy act (and others). Experts continue to argue over the legality of certain types of offerings and ICO's have all but stopped completely. Many hope that the passage of legislation carving out exceptions for ICO's will bring a return to the highly speculative industry. Until then, the STO is the new shiny toy, but without adequate or available liquidity in the form of ready exchanges, the success of STO's remains to be seen." — Jason Seibert (@ FJasonSeibert), Seibert-Law (Attorney) We want to hear your perspective too! To add to the conversation, please fill out our survey. We will be releasing the results in the coming weeks. For more research insights, check out the CoinDesk Crypto-Economic Explorer here. BULL BREATHER: Bitcoin's pullback from the three-week highs hit on Friday could be a blessing in disguise for the bulls, as the correction has taken the shape of a bull flag – a pause that often ends up accelerating a bullish move. A break above $3,630 would confirm a flag breakout and allow a rally to $4,000. Full Story​ BEST OF THE BEST CNBC: With the downturn in the cryptocurrency markets, cash-strapped startups in the blockchain industry are now letting go of skilled staff. While that is bad news for them, it’s good news for tech giants like Facebook, according to CNBC.   For example, Facebook recently snapped up a group of employees from blockchain startup Chainspace – a firm working on "giving people ownership of their personal data."  RBC internet analyst Zachary Schwartzman said such blockchain firms ultimately pose a risk to Facebook's business model. Yet, he concluded that the talent grab should be considered an "acqui-hire," rather than an attempt at something darker.  JMP Securities’ Satya Bajpai said in the piece that there is likely to be more such blockchain acqui-hires going forward, as startups shrink and tech giants start to move into the blockchain space. Snapping up groups of talent in this way allows corporates to quickly assemble a team for a particular use case, he added. THE REST SOCIABLE: Real estate and finance company Elevated Returns is planning on tokenizing $1 billion-worth of property on the Tezos blockchain, according to Sociable. The company has already held a sale of a security token on behalf of popular Colorado resort St. Regis Aspen Resort – a mid-2018 project that targeted $18 million in token-based funding. For that effort, Elevated Returns utilized the Ethereum blockchain, but it now says it will use Tezos for its property tokenization in future sales. According to the piece, the firm said Tezos’ platform is better suited to asset tokenization and offers better smart contract security. Elevated Returns ultimately hopes the move will “future proof” its token business model. The way real-estate tokenization can divide traditionally large investments into fractions potentially opens up the market to ordinary investors who might otherwise be priced out, the piece says. WASHINGTON TIMES: China is leaving the U.S. in the dust when it comes to cryptos, according to an opinion piece in The Washington Times by Charles Sauer. While China has built up a "majority control" of the two largest cryptos, bitcoin and ethereum, in terms of mining, the U.S. is still having a debate about having a debate on policy and regulation.  The U.S. needs to act now, he continues, and provide a clear framework for cryptocurrencies that defines tokens based on new asset classes. The current “regulatory purgatory” risks losing U.S. firms to nations with clearer frameworks. Worse, Sauer writes, businesses could close over concerns their crypto product might be deemed a security risk by the SEC. WHO WON #CRYPTOTWITTER Copyright © 2019 CoinDesk. All rights reserved. Our mailing address is: 250 Park Avenue South New York, NY, 10003, US Want to change how you receive these emails? You can update your preferences or unsubscribe from this list

Andrew Ng joins EmTech Digital's speaker line up

AI is changing the way you work and live. Find out how at EmTech Digital 2019.

View in browser March 25-26, 2019 San Francisco   Register now Global Leader in AI Joins EmTech Digital Lineup   Andrew Ng   Founder & CEO, Landing AI; Founder & CEO, deeplearning.ai; Co-chairman and Cofounder, Coursera   How to Develop Your Own AI Playbook Click here to join Andrew Ng Globally renowned leader in artificial intelligence Dr. Andrew Ng has just been added to next month's EmTech Digital line-up.   With a storied start at Stanford University in the field of machine learning, Andrew Ng has led a mesmerizing career breaking ground on the AI frontier. He developed Google's deep-learning-focused Brain project and then served as chief scientist for China's leading online search company, Baidu.   Since leaving Baidu in 2017, Ng has been helping individuals and organizations alike navigate the myriad ways AI is shaping every segment of the global economy. These are some of the companies and projects he has contributed to: Deeplearning.ai, an effort to help train millions of additional people in deep learning Landing AI, a company designed to help enterprises shape their own strategy for AI transformation A new course designed to help business professionals gain fluency in AI on Coursera, the world's leading MOOC (massive open online course) platform  The AI Fund, a $175 million fund formed to initiate new businesses that use AI to improve human life  Don't miss your chance to see Andrew Ng at EmTech Digital 2019, where he'll share insights from his AI Transformation Playbook and discuss how any enterprise can transform into an AI company. Join Dr. Ng and other AI innovators to prepare your workforce and your organization to succeed in the AI era. Space is limited, reserve your seat today. Register now to join Andrew Ng Also taking the stage at this year's EmTech Digital: Event sponsors: The mission of MIT Technology Review is to bring about better-informed and more conscious decisions about technology through authoritative, influential, and trustworthy journalism.  Click here to manage your newsletter preferences and email settings. MIT Technology Review, One Main Street, Cambridge, MA 02142 To unsubscribe from all emails, including newsletters, follow this link.