Beating Bitcoin’s 0 confirmation payments ain’t so easy

Beating Bitcoin’s 0 confirmation payments ain’t so easy

Satoshi Nakamoto wrote about the idea, and, theoretically it made a lot of sense. In questions concerning the need for a fast payment (the snack machine problem), Satoshi mentioned the following in mid-2010:


I believe it’ll be possible for a payment processing company to provide as a service the rapid distribution of transactions with good-enough checking in something like 10 seconds or less.

The network nodes only accept the first version of a transaction they receive to incorporate into the block they’re trying to generate. When you broadcast a transaction, if someone else broadcasts a double-spend at the same time, it’s a race to propagate to the most nodes first. If one has a slight head start, it’ll geometrically spread through the network faster and get most of the nodes.
A rough back-of-the-envelope example:
1 0
4 1
16 4
64 16
80% 20%

So if a double-spend has to wait even a second, it has a huge disadvantage.

The payment processor has connections with many nodes. When it gets a transaction, it blasts it out, and at the same time monitors the network for double-spends. If it receives a double-spend on any of its many listening nodes, then it alerts that the transaction is bad. A double-spent transaction wouldn’t get very far without one of the listeners hearing it. The double-spender would have to wait until the listening phase is over, but by then, the payment processor’s broadcast has reached most nodes, or is so far ahead in propagating that the double-spender has no hope of grabbing a significant percentage of the remaining nodes.


A few points to note in the above. What may have required 10 seconds back in 2010, now requires less than 3 seconds. Dr Craig Wright states that by checking just 8 nodes, you get the 99.9999% assurance that your transaction will be included within the next block.

So when Core developer Peter Todd fought hard to implement “Replace By Fee” (an algorithm which enabled users to double spend, forcing merchants to wait for a confirmation) on the BTC chain, he did so without any testing or statistical analysis on just how easy it is to do fraud proofs.

Dr Craig Wright states that “fraud proofs and nowhere near as difficult as anyone thinks… the solution is incredibly simple. All you need to do is randomly select a series of nodes on the network and query whether the inclusion of your transaction has occurred on that node. Each query would be random. Using a simple Bayesian algorithm, we could use a failure model to analyse the likelihood of a double spend or other attack… In under two seconds 99.98% of the hashpower would have received your transaction.”

This means that, without the cap, you can be assured of zero confirmation transactions in minimum amount of time.

Sure, this is probabilistic, but every security system works on probabilistic information. “so-called experts of Bitcoin fail to comprehend that strong encryption is [in itself] probabilistic”.

The next point to note with Satoshi’s comment is the term “good enough”.

Ravi Sandu of George Mason University and SingleSignOn.net states the following:


Good enough is good enough.
Good enough always beats perfect.
The really hard part is determining what is good enough.

The first principle is a vacuous tautology, but one that the technical security community (myself included) forgets too easily. The second principle is amply supported by strong empirical evidence in all aspects of information technology. Its application to our field is further amplified because there is no such thing as “perfect” in security. We might thus restate it as the nearly tautological, “Good enough always beats ‘better but imperfect’.”


With Bitcoin Cash, the removal of the cap and the merchant hostile RBF (replace by fee), the online eco-system has now flocked back to embrace the original vision of Bitcoin (BCH) once again.

But this has not stopped a large vocal group of online keyboard warriors spreading fear and ‘concern’ over 0-confirmation payments.

But what better way to fight fake propaganda than by issuing a direct challenge?

Arian Kuqi, Co-founder of Cryptonize.it issued this very challenge to the community, and particularly to those screaming loudest in condemnation of 0-confirmation payments. He says “it started about a month ago, I noticed a lot of comments and posts about 0-conf and how it’s nat safe to use. It’s understandable, people are stuck in their head with BTC problems and think the same goes for BCH”.

The challenge is simple…  If you can double spend, then you should be able to pay $2000, and then immediately re-spend the money by paying it back to yourself. In return, you would have earned yourself a free $1000 bucks (voucher exchangeable for BTC).

That was a month ago, and to date, there are no prize collectors.

But we did have a buyer of the $1000 voucher for which a user paid $2000… transaction log is here. And Arian Kuqi was quick to post about it.

And so Cryptonize.it was up 1000 bucks that day. More importantly, it’s proof in itself, that Bitcoin Cash cannot be double spent at 0 confirmations. Not without significant investment anyhow.

Arian has mentioned that he’ll have many more of these challenges coming up in the near future. After all, it is no loss to him… As for any ‘attacker’, Arian promises that it’s fair game if they do succeed. “I announced that I would not press charges or block the card at Amazon if the double spend succeeded, so no risk there for the attacker. Same goes for the coming challenges.”

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.

Bitcoin Core 0.16.0 is finally released with full Segwit support

It’s been a long time coming, but last week, Bitcoin Core, the development team responsible for the Segwit fork of Bitcoin, finally released an update to their client, featuring full support for Segregated Witness.

In short Segregated Witness was touted as a scalability fix in itself, but as BTC found heavy usage during the 2017 run to its ATH (all-time-high), fees shot up to astronomical heights, and congestion levels reached unprecedented levels, forcing users to wait up to and over a week at times for transactions to confirm. The aftermath of which gives strong evidence for a false news media campaign concerning the scalability capability of Segwit.

However, Segwit’s true capacity increase which is only expected to provide a mere 1.7-1.8MB on average effective blocksize (or, 5-6 transactions per second throughput), will be made apparent only when the vast majority of the eco-system adopts ‘Segwit’ transactions.

Because of the way Segwit was introduced as a soft-fork, it allows Bitcoin legacy transactions, while incentivising the newer ‘Segwit’ transaction format. Thereby, encouraging users and businesses to switch to Segwit transactions, over time. As more and more wallets, exchanges, and businesses adopt Segwit, the blockchain slowly finds itself migrating over to “Segregated Witness” addresses and transactions, abandoning the original Bitcoin transaction format as laid out in the Satoshi Nakamoto whitepaper of 2008.

While many adherents to the ‘Core’ faith have been loud in the condemnation of entities like ‘Coinbase’, for whom it took 6+ months to implement Segwit, it ought to be equally observed, that Core themselves, have taken just as long to release full native support for Segwit in their own client.

It is most pivotal that Core released this as soon as possible given that so much of the rest of the eco-system is depending on them to move first. Take for example, the major exchange Kraken, which tweeted the following:

Sounds reasonable.

Certainly, the Segwit soft-fork will now have its engine roaring a little louder, as evidenced by the below graph illustrating the rising number of Segwit transactions over-time (particularly since Coinbase and Core announced support). Take note of the rise from block number 511075 (27th of Feb 2018) onwards.

Bitcoin Core 0.16.0 is finally released with full Segwit support.
source: Segwit.party

As ascertained above, at 6+ months following the activation of Segwit on the BTC chain, the adoption rate for Segwit transaction still sits at only marginally over 30%. In order for the new capacity limits of 5-6 transactions per second to be realised, it requires near universal adoption of Segwit.

What does ‘Native Support for Segwit’ mean?

Upgrading to support Segwit transactions can be a technically tedious task, hence why many businesses have been waiting on Core to move first with their client, which in turn makes implementation a little easier for everyone else. A large part of the BTC eco-system already supports Segwit transactions, although this is done in a non-native, backward compatible manner.

The way non-native Segwit addresses work, is that they use former lead developer Gavin Andresen’s P2SH (pay-to-script-hash), which always start with a “3” instead of a “1”. Because the Bitcoin client already accepts P2SH, using it for Segwit in an effort to on-ramp usage quickly, made sense. But it has many drawbacks.

Using Segwit through P2SH is inefficient, and wastes in the mempool, and it therefore can contribute to rising fees. Native Segwit addresses are known as bech32 addresses, and they start with “bc1”. Native use of Segwit works a little more directly and more efficiently as bech32 has no non-witness SigScript (Signature Script).

However, because native Segwit addresses are a new bech32 format and “look different”, older wallets do not recognise them, and users that don’t upgrade such wallets won’t be able to send to these addresses.

What else comes with “Bitcoin Core 0.16”

Segwit Wallets aside, two very notable changes are:

– HD Wallets are the default! HD Wallets (Hierarchical Deterministic Wallets) are type of wallet that changes address every time it is used for receiving funds. HD wallets have been used for quite a while now, and all major wallets utilise this functionality.
– The highly controversial RBF is default in the GUI. Core’s “Replace By Fee” feature is now on by default.

There are a host of other changes introduced, most which will make little impact to the end user. For a full list of changes, check out the release notes.

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
Dr. Craig Wright “backdating” claims should be taken with a grain of salt

Dr. Craig Wright “backdating” claims should be taken with a grain of salt

The internet community can be a funny place. If you’re at all a public figure, you can expect to be spat at, ridiculed, accused, and pretty much deemed guilty before any conclusivity.

Dr Craig S Wright is no stranger to being on the receiving end in this manner. Entrenched in a world where every keyboard warrior believes they are judge, jury, and executioner can be taxing. But the burden of proof should always lie with the accuser.

One of the most prominent of websites out there today that many rely on for evidence of sorts, is the “WayBackMachine” – famously known as the “Internet Archive”. If there are any doubts as to the authenticity of a publication date, internet users will flock to http://web.archive.org/ and quickly assess the date of publication, as captured by WayBackMachine’s crawler, snapshotted into its archives.

Certainly, many claims that have been made against Dr Wright place heavy reliance on this tool. Claims that he maliciously backdated information, and attempted to conceal evidence are peppered on forums every time the spectre and possibility of Craig Wright being Satoshi surfaces.

But how much trust should we place on such services and their capacity to provide accurate information in this regard?

The first and most obvious detail to note, is that WayBackMachine is not some immutable database that is resistant to change and modification.

But more interestingly, is this second point: The behaviour of WayBackMachine can be to some degree, piloted by webmasters themselves.

This isn’t some voodoo magic. It is search engines, and archiving tools such as WayBackMachine, functioning as designed. Web developers are very familiar with this concept, but it is very possible (in fact its blindingly easy!) to omit a particular page from appearing in WayBackMachine (or google for that matter), for a defined period of time, simply by placing a couple of meta-tags within the HTML header of a webpage.

Let’s take this opportunity, to see just how easy it is for anyone, to manipulate and control their webpage snapshots, on a site like WayBackMachine.

The above meta-tag in bold instructs most search engines not to index the page. Most search engines therefore, will not show the webpage in their search results.

Further X-Robots-Tag can also be used an element of the HTTP header response for a given URL.

Take the following example as a response:

Now the above will do two things.
The “noarchive” directive will prevent a search engine from creating a “cached” copy of the site. The “unavailable_after” directive ensures that the page does not show up in search results after a specified date and time.

The two directives together are able to completely remove a webpage off-record until a specified date, throwing into question the entirety of the “he created the page in 2014/15” argument.

Simply put, these tools index and cache webpage content in a manner as requested by an author.

Does Dr Wright use such meta-tags in his posts?

His response: “It’s my right to privacy”.

Sure enough, many of the pages that are linked externally from 2011, only show up on the WayBackMachine archive in 2015

Perhaps machines can tell us many things… Much of which can be useful, and usable. But without knowing the ins and outs of any tool, it would be foolish to treat the output of any such tool as conclusive evidence. Search engines, and archivers of this nature are tools to assist both search engine users, SEO specialists, webmasters and web developers. They are not ‘designed’ as a forensic tool.

Further information on the usage of Robot meta tags, you can view Google’s own documentation on the topic here.

Eli Afram
@justicemate

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
Core Dev Peter Todd admits Lightning Network has issues

Core Dev Peter Todd admits Lightning Network has issues

It takes a lot for a staunch advocate of a technology to question its capability. Very recently, Bitcoin Core developer Peter Todd, made an admission that Lightning Network is full of holes.

Praised by many as being the scalability fix for the Segwit chains’ scaling woes, Lightning Network has indeed come short on many fronts, and many people are beginning to question if it really is up to the task, including one prominent contributor to BTC’s code.

Core Dev Peter Todd admits Lightning Network has issues

“Segfaults” (or Segmentation faults) are generally quite common when programming in C. But the more complex a program, the more chance of there being such instances of these bugs.

Segfaults are generally caused by a badly written program that tries to read or write to memory locations that are out of range. A common segfault for example is an out of bounds array, or a variable that has not been declared properly.

The problem with coding in C++, is that it is an extremely powerful language that gives full control of the mechanics of the application to the developer. This can be a very good thing, but it can also be terribly dangerous. The compiler assumes the developer knows what they are doing, and it will not try to ‘guide’ the user, as is the case with modern programming languages.

On one hand, Peter Todd is right. “Writing it in C, is a notoriously dangerous language”. But on the other hand, we have to question the logic both ways. If the coding language of choice was right, then why are there so many holes in the application, which are apparently very difficult to identify and resolve? If the coding language of choice was incorrect, then how much faith should we be putting in the leadership of this project?

Lightning is still far from ready on all accounts, many have already lost funds in testing Lightning Network on the main. In the same thread, Peter mentions that he’s lost funds testing “Éclair” – an android, “lightning ready Bitcoin wallet”.

He goes on to mention “As for the Lightning protocol, I’m willing to predict it’ll prove to be vulnerable to DoS attacks in its current incarnation, both at the P2P and blockchain level… While bad politics, focusing on centralized hub-and-spoke payment channels first would have been much simpler.”

Let’s ignore the ‘centralized hub-and-spoke’ comment there…

In my other life I am a business analyst and a developer. A BA role entails identifying business needs, and determining solutions. One of the most common project management methods out there is known as PRINCE2. It is used across a multitude of industries for the delivery of projects. But one interesting concept that I find myself drawn to regarding PRINCE2 is the tenet of “continuous justification”. If at any point of the project lifecycle, the outcome can no longer be justified, then the project is dropped.

As far as LN is concerned, at no point have we seen those steering the ship, reassess the viability of the project. In PRINCE2, one of the initial documents coming out of the process is the business case itself. Let’s suppose for a moment, that the Lightning Network whitepaper fills this gap. The paper identifies Bitcoin’s scalability problem, and makes a proposal for off-chain channels that can be settled on the Blockchain afterwards.

At some point after, it was then identified that it cannot scale to the desired level, and that there are some fundamental problems with the funding of channels. So then a ‘third layer’ was introduced, to scale funding capability of channels.

Another problem still open is how channel updates can be broadcast to everyone, particularly at a global adoption level. At 1 million channels, things can get very ugly.

The problem we are facing, is that this is patch work, after patch work, after patch work… At what point does project leadership, take a step back and reassess the viability and feasibility of LN as a global scalability solution?

Entities like Blockstream who are in part sponsoring the development of Lightning Network, have a lot to lose. There’s a reason that PRINCE2’s “continuous justification” principle became a thing…  there are indeed many businesses that are guilty of throwing more and more money at a project in an attempt to save it, than to go back to a drawing board. Some people just want to save face.

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
BCH Jeepney brings Bitcoin Cash to the streets of Manila

BCH Jeepney brings Bitcoin Cash to the streets of Manila

In what can be considered to be one of the most creative and ground roots of projects concerning Bitcoin Cash, comes the BCH Jeepney. Jeepneys (or simply Jeeps), are the most popular means of public transportation in the Philippines. An idea was born to purchase a Jeepney, and use it to promote BCH around the busy streets of Manilla in the Philippines, with a view then, to see this project turn into a fleet, and potentially span other cities and countries.

BCH Jeepney brings Bitcoin Cash to the streets of Manila

The project masterminds have asked to be named by their aliases “MrG”, “WildCard” and “MrSkatman”.

“It’s all MrG’s creation… he lured me in to his mind with an InitialLamborghiniOffering which inconspicuously morphed into a Jeepney. Not knowing what a jeepney was nor how to wrap it with BCH artwork I called on the skills of MrSkatman who jumped in with brilliant ideas to move the concept forward. Within a matter of tweets he escalated our thinking by asking the purchase price, we then started to discuss ways to cycle profits back in and keep the project running. From that, the #InitialJeepneyOffering was born, and more creative people have been included as the project continues to grow…,” said ‘Wildcard’.

This is an excellent opportunity for Bitcoin Cash to shine with a real world use case, through busy cities with a payment system that’s safe. ‘Wildcard’ adds, “Aside from that, it’s also a great way to connect people from different cities around the world through social media and a peer to peer electronic cash system. I really have no idea how it will play out, I just know that the people involved are all committed to this project working and somehow through this we’ll get BitcoinCash flowing from one side of the planet to the other.”

MrSkatman agrees, “I would add for me it is also a way to show all onlookers that we are real, we mean business, we have momentum, and we are willing to put our time and resources on the line to see this happen. As a chairholder I have a chair on the Jeepney — a seat in this project as a participant in helping promote BCH and spread the good news.  This is purely out of love for BCH and the people of Manilla. I’d love to see this pilot project succeed and repeated. The number of people who will be impacted is hard to calculate. It is more than just the riders.  Their stories, the press, twitter, and the coverage this project gets… It does well for the Philippines, but also for those watching and seeing it happen. It has the potential of being quite impactful for a minimum cost.”

MrG who is leading the project says he wants to “see this project reach millions of people and give people the tools they need for a successful future. Staying in the Philippines has shown me that everyday people need more ways to remit their funding from abroad. Families over here send their children and loved ones overseas to work and send money back home. This country has so much potential to grow and the monetary system in place is very limiting for them to advance. This project will help students, elderly and entire country in my own opinion by showing them that there are more ways use money, and BCH is the answer. I would love to see this project repeated and used to reach the other regions of this country. I think the profits from the BCHjeepney should be reinvested back into the project and using it as a self-promotional tool to upgrade the Jeepney and get more users excited about BitcoinCash. I would love to see a massive fleet of these in all the major cities here locally and globally to help spread the word of BitcoinCash.”

He has been so excited and encouraged by the project, that he’s taken it further to sponsor a local basketball team.  MrG says “their name is Team BCH, in Bulacan City, Philippines. We wanted to get to the hearts of the Philippines for which basketball is played everywhere… It gives us a chance to speak with the locals and get questions answered about Bitcoin Cash and support their community. Every game we have about 5 to 10 people watching and answering question about Bitcoin Cash. Also on how they can download and start using it. We are working on a hand out in Tagalog and English”.

The Jeepney route covers a little over 10km in the heart of Manila. Travelling from Philcoa to Quiapo to Kalaw. MrG says that the Jeepney will very easily be seen by over 500k to 1 million people each day. The route goes around Quezon Memorial Circle, which is a national park located in Quezon City, also known for being the capital of the Philippines from 1948 to 1976. The park is located inside a large traffic circle in the shape of an ellipse and bounded by the Elliptical Road. – https://en.m.wikipedia.org/wiki/Quezon_Memorial_Circle
Quezon Memorial Circle is the 10th-largest city square in the world by size.

MrG adds: “The Jeepney will create revenue by its daily passengers. Each passenger will pay 8 pesos for the standard rate. There is a discount for elderly and students and that’s 7 pesos. We will take cash payments in the beginning and plan to fit out the Jeepney with either QR code or a RFID BCH loadable prepaid card. That way, each passenger can get a wallet and start using BCH. We want to add more to it and this will be a test pilot for that to hopefully expand and to see what users want so we can migrate that into our design. The bounty for the day will pay for our drivers to be driving around the clock. Any extra money the Jeepney makes will be pulled together and the whole team can decide which improvements from the daily suggestions we get while operating the BCHjeepney.”

This “whole team” that MrG speaks of is made of a list of “chairholders”. These are, BCH fans and supporters from across the globe that have agreed to sponsor a “chair” on the Jeepney. All up there are 20 seats, and the following twitter names have funded a chair for 0.5 BCH.

@a3456gf
@hopetrustgood
@Scottbuszard
@MindStatex
@stackmyBCHup
@nChainGlobal
@justicemate
@bsmith12251960
@MADinMelbourne
@JGPI2017
@brad1121
@BCHplsmomma
@BigRedMurphy

+1 user who wish to remain anonymous.

There are six seats left, which will complete the funding for the project. “We have other ways to contribute to the project, including advertising on, or in the vehicle… such as on the ceiling, which looks like a big blank canvas waiting for some BCH activity. Bitcoin.com will be the first to get their logo painted on the sides, and they are kindly gifting us merchandise to give away as prizes during the jeepney journeys. We are open to all ways to make this project interactive,” said Wildcard.

By all means if anyone interested in helping fund this exciting project, or become a fellow “chairholder” should contact the project by tweeting directly to @BCHjeepney – This is the official channel for the Jeepney’s communication. @BCHjeepney posts photographs, updates, progress and more. Wildcard says “If anybody wants to spread the project and manage it on other platforms, please, let’s talk.”

While Bitcoin Cash has had an incredible six months of technical developments, it’s certainly reassuring to see developments coming about on creative fronts such as these, which also make a very positive impact in a very different way. We at CoinGeek will be keeping a very close eye on the developments in Manila.

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
Lightning Network scalabity woes

Lightning Network scalabity woes

Had Lightning Network not been forced down our throats, we might have come to really like the technology. But like many things in life, it comes with a politically burdened narrative. Lightning Network in its essence is not a bad thing, and can have some excellent use cases, particularly for HFT (high frequency trading) -like transactions between big entities.

For the average, and ordinary user, it is a far cry from the simplicity, and ease of use that BTC had many years ago.

Today the majority of Bitcoin users wouldn’t even know what to compare Lightning Network to. The migration to off-chain solutions has been done in the most patient, and calculated of ways.

There are many problems that BTC has today, that have been artificially created and introduced to the system over the years. Scratch the surface and you’ll find that this has been one long intentional method to skew the road map, introduce problems for which supposedly LN and sidechains can fix in future.

The first and most obvious claim that LN makes is that it resolves the Bitcoin scalability issue. The second is for instant transactions. Both of these were non-issues in the beginning. Bitcoin was able to both scale, and perform virtually instant transactions. In fact, Satoshi Nakamoto himself in 2009 stated “The existing Visa credit card network processes about 15 million Internet purchases per day worldwide. Bitcoin can already scale much larger than that with existing hardware for a fraction of the cost. It never really hits a scale ceiling”.

The scalability issue for Bitcoin has been concocted artificially, and introduced into the system over time, deliberately to stall progress. In fact, the Bitcoin Unlimited team, together with nChain last year proved that the real limitations on block propagation is not hardware at all, but rather the Satoshi codebase. With some tweaks and changes, the throughput can be increased substantially. BU were able to mine and propagate 1GB blocks across three continents in a sustained effort, achieving VISA level scaling. At that point, the limit is still software related, and not hardware. By making further changes to the model of the processing infrastructure, we can achieve much higher throughput still.

It’s important to note that 1GB blocks were mined and propagated using very ordinary 16GB RAM, 4 core machines, with good internet. Despite this, there is still a propaganda at play that says Bitcoin should run on raspberry pis. It’s time we start taking the Bitcoin project seriously and understand, that in order to be a competitor, as a global currency, with global adoption, we should not expect the network backbone to run on hobby computers. Satoshi very much predicted and anticipated that server farms with specialized hardware would eventually do all the mining. VISA doesn’t run on a 286 machine, and we shouldn’t expect Bitcoin Cash to do so either. This means dedicated services, cloud, and ASICS (which are by definition “specialized hardware” as Satoshi put it). The bigger Bitcoin gets, the more decentralized it gets. The higher the price, the more competition, and the more miners join to compete for a piece of the pie. Nodes that don’t generate blocks contribute nothing to the decentralization of Bitcoin, only miners do. So, by this regard, a bigger Bitcoin that is allowed to grow, and isn’t artificially handicapped, actually ends up being more decentralized, than a small one.

With scalability being a non-issue, and an entirely fabricated one, the one thing LN has left is fast transactions. Once upon a time, BTC actually used to do transactions very quickly. In 2014 and prior, you could pay for items in a virtually instant manner. Again, false propaganda was spread that said unconfirmed transactions were unsafe. This was another lie invented designed to de-rail the roadmap, and skew the objectives of the system. Research has already been done to confirm that by querying a number of nodes, we can heavily reduce the probability of a double spend. 0 confirmation payments (tech-speak for fast payments) were very much safe, and many merchants relied on such things for smaller payments. In fact, 0-confirm (instant payments) on BCH are safe up to the order of at least a couple of thousand-dollar transactions. Beyond that, it would be advisable to wait for a confirmation. And of course, if you were to purchase a house with your BCH, then perhaps wait out for several confirmations. The bigger a transaction, the more incentive a criminal has to attack, and consequently, the more incentive a merchant has to ensure they receive an acceptable number of confirmations.

Today 0 confirmation payments on the BCH network, work like charm. Try loading up a few dollars at cashgames.bitcoin.com and have a game of roulette. But take note of just how quickly, you can deposit some coin and start playing, and how quickly you can withdraw your winnings. Literally almost immediately.

Lightning Network has a use case indeed – and it’s not for scalability. This is the problem. First it was Segwit that was touted as a scalability fix. Now, it is LN that is touted in the same way.

Here’s the blow: LN assumes every user has a Lightning Network Node, and that it has been connected to the rest of the network of connected users, by opening a channel to a well connected node. The assumption is that, over time, more and more nodes will connect to the network and create large clusters of connected nodes all of which are interconnected, allowing anyone to pay anyone by routing a payment through a set of nodes. Joining the network requires an on-chain transaction (to establish a channel), and your node needs to remain on. We know already, that as BTC becomes more and more popular, $100 transactions are not unusual (it’s already happened). And this would be the cost for opening and closing a channel. This seems like a costly exercise with a lot of friction. Time. Effort. Money.

All in all, it is extremely difficult for the 3rd world to embrace the Lightning Network. You literally cannot pay a poor person, unless they pay an on-chain transaction fee to open a channel to the network first. Sure, you can pay the on-chain transaction fee yourself to open a channel directly to them, but then, doesn’t that defeat the purpose? The idea of LN is that you don’t have to open a channel with every single person you want to transact with…

Where Lightning Network wins is with major corporate entities that require dedicated channels between the two for fast, efficient payments, that can be settled on chain at close of day. In such a scenario the distance would be d<3 and could be deemed safe from a Sybil attack. LN has use cases. I stand by that. But to call it a scalability fix would be an abomination.

Any scalability fix should work holistically. It should not cater to some and not others. If Bitcoin today works for both rich and poor, then a scalability fix for tomorrow should not simply cater for the rich. That’s not a fix, that’s a hack.

Today, BTC has what’s known as an unspendable wallet problem. That is, there are currently countless number of wallets out there, which have less money in them, than the minimum fee required to make a transaction. These are dead wallets, with money that cannot be moved. With Core’s “full block policy”, this problem won’t go away. And at times of heavy use (such as during the peak of the All-Time-High earlier this year), the number of unspendable wallets blows up to dramatic numbers. A simple blocksize increase fixes this problem in its entirety. Lightning Network does not. Unspendable wallets remain a fact of the system with LN, since an on-chain transaction is required to open and close a channel.

Off-chain transactions are not at all harmful to the system. But forcing the majority of users to use it, makes it stink. Yes, we’ve heard, it’s “opt-in”. But is it really? Do users have an economically sound choice when they are forced to pay transaction fees on-chain because of an artificial lever that developers control?

These off-chain transactions are a clever use of Bitcoin script, creating a bunch of unconfirmed transactions that sit there until close-out. Essentially, these transactions are a form of what many in the in the crypto space now refer to as “smart contracts”. But for Bitcoin, smart contracts should be the exception to the usage of the system, and not the rule. Core have decided to switch that right around.

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
Centbee to deliver a game changing eco-system replacement

Centbee to deliver a game changing eco-system replacement

Centbee to deliver a game changing eco-system replacement

You may have read some press releases concerning nChain Group taking equity stake in Centbee, a Bitcoin wallet provider that aims to make global payments straight forward and easy.

Centbee, headed by co-CEOs Lorien Gamaroff and Angus Brown, come with a wealth of experience from within the financial sector itself, covering online banking development, merchant systems, retail banking, and extensive work with regulators, and much of which has been done in the digital space. All things that are abundantly important in taking Bitcoin Cash to the next level.

What hasn’t been reported in any extensive detail so far is just what the fruition of the Centbee and nChain deal is going to be.

In my discussion with Mr Brown, I specifically asked questions concerning the functional outcomes of this project. We know nChain’s investment is a large undisclosed sum. There’s more to this than just a wallet. I went digging.

Astonishingly, I’ve found the very work Centbee are doing, is precisely what the Bitcoin (BCH) eco-system needs – and desperately.

When Dr Craig Wright tweeted “Expect some BIG things this January with BCH. The crypto world is about to change and grow up.” He was onto something… because he had seen what Centbee had been working on.

Mr Brown says his time in banking has been building digital offerings and digital banks. “Centbee is the next generation of where banking is going to be. A lot of we do replaces what banks do, but with next generation models. I have good insight of how [banks] do it all. And I understand merchants, point of sale systems… we implemented all this for Mercantile. We know what banks do and don’t do.”

Brown was actually the Chief Information Officer over at Mercantile bank. His knowledge on the subject comes from profound experience. He states “I have a good relationship with the regulator… I know how the reserve bank works, I know the payment industry really well… it’s given us really good context to build Centbee.”

So how do you get banks, and regulators involved? Sure enough one of the most challenging things concerning Bitcoin has been getting trust from the institutional banking sector. “Regulators get scared of Bitcoin, and it’s because of the risk that they see… we know how to help the regulator get over the risk, we’ve been working on addressing those very things they are concerned with.”

It dawned on me that what Centbee are building – is far beyond being just a wallet. In fact, it is an entire eco-system being built using Bitcoin Cash, from the top down.

“The wallet is the easy part, most of that’s already done and we’ve been working on the user interface now trying to make it ‘slick’” said Brown. Lorien Gamaroff who leads much of the coding specialties has also done a lot of work from a user interface and experience point of view. Brown says of Lorien that “he has design flair… he even once worked at an ad agency as a director… He has a good sense of user interface… I’ve also built 6 digital banks, I understand what to do and what not to do”. Certainly however, one of the most frustrating things about Bitcoin is that it can be difficult to get money into it – with all the commotion of verifications, exchanges and the like… but Brown says “We are going to change all that and make that really easy…”

In South Africa, one interesting piece of technology that is used is called “Authenticated Mobile Transaction” or AMT. It is a standard payment method there that Brown says they can leverage to allow customers to enter debit number and do authenticated debit that is non-disputable. Using authenticated debit card transactions takes the risk away from the business. “Debit cards are popular in South Africa, so that’s the first step” he said.

So, what makes this wallet so special and so easy to use? “Contact integration is the killer use case”. Centbee have devised a method where it is super easy to send anyone an amount of money. They don’t even have to have the app installed, and in fact, they don’t even need a Bitcoin wallet at all. The app cleverly notifies a user and advises them to get the wallet to claim their money if they have any sent to them. This is a sorely needed function for wallets, and Centbee addresses this.

Brown kept going back to “WhatsApp”. The idea is that Centbee should have its ease of use, modelled after something like WhatsApp. “Sending money should be as easy as sending a message on WhatsApp” he said.

The other interesting area that Centbee are looking at concerns sending every day money. That sounds glaringly obvious, and Brown even laughed when he said it, but allow us to elaborate. Right now, there is a legitimate inaccessibility to send money across the country, or to neighbouring countries. The existing methods are either far too expensive, or just unreliable. Centbee tackles this problem by enabling citizens to be able to send a sum of money instantly, that is, fiat to fiat.

Picture that, a solution that makes money transfer so easy, that you don’t even know that you’re using Bitcoin Cash. Brown explains that Bitcoin Cash in this case works as the medium of transfer. Ofcourse that’s not the way it’s going to remain, as adoption grows, more and more people may choose to receive BCH instead of fiat.

Usability is key with all of this. Accessibility has been thought through to the n’th degree that even grandma can use it. Brown said “this is a real important human problem to be solved, especially here in South Africa, where there is a real need”.

But Centbee’s clever approach is multi-faceted, as Brown explains: “Next we want to allow people to buy Bitcoin from merchants. And we can do this using Gift cards that you see in malls, so we can have Centbee cards that can be purchased with cash.”

“Merchants are actually the key to this… When we were talking to the guys at nChain, we said that you have to have consumers, and we have got some great ideas.”

At this point I ventured into confidential territory and I wasn’t preview to too much further than this. But Brown did highlight an interesting strategy their business is taking to embark on this mission. “rather than approaching every merchant one by one, we are doing it by going straight to the ‘integrators’” – that is to get them to onboard BCH integration at the top level and have it filter down. “I can’t disclose too much, its strategic” said Brown.

There was a lot to this conversation, but I’ve touched on many points that I think are pivotal. This is one giant project that addresses a plethora of weaknesses within the current framework for working with Bitcoin (BCH). If they can pull this off – and I totally believe they are going to, then this will be a catalyst in the mission to revolutionise Bitcoin Cash and really thrust it into the mainstream.

Interestingly, this is the first time I have come across a major Bitcoin related project that is spearheaded by tremendous institutional knowledge and prowess. The team at Centbee understand the entire business model from customer to merchant and to bank. Most crypto related projects are generally controlled by developers who have very little to no understanding and exposure to the established institutions. If you want Bitcoin in the mainstream, you need two thing… first its ease of use, and second it is integration into existing systems and processes in the most efficient way possible. Centbee are doing just that. And for once, it’s not the tail wagging the dog. When you let developers dictate the functions of a system, then you end up the way ‘Bitcoin Core’ did in 2017, where Bitcoin actually lost merchant count for the first time in its history.

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
Bitcoinj.cash is alive and kicking

Bitcoinj.cash is alive and kicking

Bitcoin Cash has in the last 6 months, experienced unprecedented growth, merchant adoption, rise in mainstream media coverage, and development that has literally not been seen in any cryptocurrency across the board. The momentum is undeniably in full swing, and the restoration of Bitcoin is at hand.

One very important piece of the puzzle that doesn’t get enough attention is the resurrection of bitcoinj. Bitcoinj is a Java library used for working with the Bitcoin protocol. It was originally conceived by Mike Hearn, one of the original Bitcoin developers with an astute ability to code and understand the economic incentive system of Bitcoin. It was also the very first Bitcoin implementation that specifically targeted SPV (Simple Payment Verification) light wallet functionality – where only a small part of the blockchain is downloaded – making it suitable for use in small devices such as tablets and smartphones.

Its history is well documented, and the project is well established in the roots of Bitcoin development. In fact, a large number of Android wallets on the market today use the very software that is backed by the bitcoinj library.

Thanks to Steve Shadders, who was actually involved with bitcoinj and writing pool server software in the early days of Bitcoin development, the bitcoinj project is revived in a fork now known as bitcoinj.cash. Although other teams have also created their own forks of bitcoinj, the bitcoinj.cash project, looks at unifying the forks across the board, and turning this into the community driven project that it once thrived on being.

In a reddit post last week, Steven Shadders made mention Bitcoinj.cash community is alive and kicking with some exciting projects already using it:

Steve states “First off HashEngineering’s Android wallet is in the process of switching over to bitcoinj.cash, you can check it out on the Google Play store here. We are also working to revive the Lighthouse crowdfunding application which has been dormant for a few years but thanks to low fees on BCH is now viable again”.

Steve’s efforts with bitcoinj.cash are now being sponsored by nChain, a company which hasn’t been shy in sponsoring and promoting projects that fit the Bitcoin Cash trajectory to global adoption.

I caught Steve (who happens to be a fellow aussie) for an interview regarding the project, and he wasn’t short on letting me know that he had big plans to take this to the next level, and do what it takes to further enable Bitcoin Cash. Here’s what he had to say:

“Originally, bitcoinj was supposed to be specific to SPV functionality, but it later started to evolve into a bitcoin library… It’s in JAVA and businesses love JAVA, so it’s important to the ecosystem… I like to call what we’re in right now the age of the professionalization of Bitcoin”

Can you explain bitcoinj.cash in a nutshell ?

“It’s got all the basic functionality of a Bitcoin node… It contains all of the components needed to build a wallet. Quite literally you just need to wire them together… there’s a demonstration project in the library. I’m pretty sure that Mike never imagined that it would be used for components in a pool server.”

Did you know Mike Hearn personally or..?

“I never met him but I interacted with him a fair bit in the early days because I needed things in bitcoinj which weren’t in there for the pool software…”

Do you still keep in contact with Mike Hearn at all?

“Very occasionally, I did let him know that this was coming up, and that I was working on Lighthouse”

So how’s the governance of the project, are you leading it?

“There were already 2 or 3 forks to get bitcoinj.cash working. They didn’t appear to be aware of each other… so I reached out to a few of the developers… I already grabbed the bitcoinj.cash domain… so I reached out to the developers, and they all agreed it would be better for us to work together… I actually haven’t done much of the coding so far it’s been more so HashEngineering and Daniel who’ve done most of the dev-work but that will be changing”.

And what’s the plan going forward with it all?

“It’s 7 year old code, so a rewrite and a refresh of the code is definitely up….

One thing we want to do actually is translate the whole library to Kotlin, which is a JVM (java virtual machine) language which is interoperable with JAVA. It’s relatively new but it’s well supported language. It’s what Lighthouse was written in… It comes with one significant advantage, and that’s that it can be compiled to native code which means it can run on any platform, so it can run on an iOS and anything else.”

And you’re looking for people that can help contribute?

“Yes definitely. Anyone who’s interested and thinks they can contribute should get in touch.”

“One of the main things we need out there is a super user-friendly wallet, and I think that bitcoinj.cash can facilitate that. Someone with good UI and UX could take the library and turn it into something really slick.”

So it sounds like bitcoinj.cash is going to have the same (if not more) impact on Bitcoin Cash as it did early on, in the Bitcoin ecosystem. Not only will the library be expanded, but it will be refreshed, this will further enable more diverse applications not limited to just SPV wallets, but potentially nodes, pools, and whatever else comes next, making it as efficient and as possible in its re-write.

The Bitcoin Cash eco-system continues to impress and grow day after day, and we have lots to look forward to.

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
Yours.org raises 1.5M USD in funding round led be Bitmain and nChain

Yours.org raises $1.5M in funding round led by Bitmain, nChain

Yours.org is novel idea focusing on getting everyday people paid for doing what they love on social media. That is, earning Bitcoin (BCH) for creating good content, finding good content, and commenting on good content.

Sure enough, the web application has already generated a frenzy of activity, particularly with the BCH community, where micropayments, are not only possible and feasible, but also encouraged.

Ryan X. Charles, CEO and Cofounder of yours.org has on numerous occasions expressed just how much BCH has enabled his business to flourish. Certainly, the site is well known among BCH enthusiasts, for this reason.

Mr Charles along with Dr Clemens Ley (who had discovered Bitcoin was indeed Turing complete), had founded the social media site in 2016 and are planning to hire a team of “the world’s best” with an emphasis on engineering and growth.

The duo now find themselves in excellent position with solid capital to take matters to the next level. Mr Charles was pleased to announce that Yours.org have just closed a funding round raising 1.5M dollars. An effort that was led by Bitmain and nChain, two of the most notable companies within the industry.

In an interview with CoinGeek, Mr Charles made mention that “the $1.5 M will be used for hiring and general product development. There are no “new” projects other than developing our own existing product and achieving massive growth. We believe we are very close to a high level of growth bringing BCH to a mainstream audience this year. We need to work with users and iterate the product as rapidly as possible to do that.”

We’ve already seen many quality submissions at Yours.org – The majority of which are crypto-related. Although other content is there as well… In talking to Mr Charles on future plans to branch out further into other topics and diversify, we asked how they plan to reach the mainstream.

“We are focusing on cryptocurrency first because it is the most natural first use-case for our platform. However, we intend to be fully mainstream this year. Cryptocurrency is a way to get core users who really care about the product in spite of usability problems at this time. They help us identify the most important problems to fix and features to add so that we can reach a mainstream audience. Throughout the year, we plan to get a broad array of content that has nothing to do with cryptocurrency” states Mr Charles.

“We believe the best way to reach a mainstream audience is to get people paid for their work, in Bitcoin Cash… the plan for this is predominantly hands-on whereby we work with our users in different categories to figure out their biggest issues and solve them one at a time. When we believe the product is ready, we can add an affiliate/referral system which will spark massive growth.”

Given the already thriving success of Yours.org, the funding round can only do a power of good for an already established application as this. Branching out to the mainstream (beyond crypto) is pivotal, Ryan & co believe they have the right roadmap, and soon the right “expanded” team to do just that.

For BCH supporters, the return on investment is two-fold. Not only does this help the eco-system and present an excellent use case for BCH, but it drives further adoption and visibility.

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.
Dr Craig Wright makes pledge to donate millions to “make the world I am in better”.

Dr Craig Wright makes pledge to donate millions to “make the world I am in better”

Recently, the chief scientist at nChain, Dr Craig Wright, made ripples again (pardon the pun) in social media circles after tweeting a direct offer to Mises Institute.

Recently Mises Institute, which exists “to promote teaching and research in the Austrian school of economics, and individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard” had begun accepting BCH donations on their official website, which caught the attention of BCH fans on reddit, and also, one Dr Craig Wright.

Dr Wright made a payment of $5400 (2 BCH) to Mises Institute to make his intention clear, tweeting:

Dr Craig Wright makes pledge to donate millions to “make the world I am in better”.

According to the donation address, Mises did receive just under $5,400 USD on the 14th of January, and then just hours later, received the promised 10 BCH, valued at just under $26,000 USD. The donations dwarfed other donations in comparison.

If you didn’t think much of that, then you would have on his follow-up.

After mentioning Mises Institute and Khan Academy in an earlier tweet, Dr Wright stated “I plan to pledge at least 100x the BCH value at the end of each year. All places I think make the world I am in better.”

That is a pledge of 1 quarter million USD for this year at least. He followed on with “…hoping to make it a million USD next year with over 10k BCH”.

Interestingly, in an even earlier tweet, Wright mentioned that he believed the price of BCH will surpass 15K by the end of the year. That would make next year’s donation over 1.5 million USD.

Dr Wright though has proven himself to be no stranger to charity or making donations to institutions he believes abide by his philosophy. In December last year he pledged another 100,000+ USD to charities, and followed through in his commitment with donation recipients including the likes of Zamzamwater, Burnside in Australia, FareShare among others. All in BCH ofcourse.

Donations are (at least in Australia and most of the world) tax exempt. With the rising prices in BCH, they make an excellent use-case, and I certainly encourage more of this sort of action from, particularly long-term BCH holders. Not only do such donations inspire other charities and entities to accept and adopt Bitcoin Cash, but it also goes some way in gaining visibility, scoring wins all-round. If we can make the world a better place, why wouldn’t we?

Eli Afram
@justicemate

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.