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Monday, 31 December 2018
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Iranian officials have declared that aiding the development of Telegram’s Gram token will be considered a criminal act
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New Year's Eve Times Square drone grounded due to weather, NYPD says
A rainy New Year’s Eve in New York has some Times Square revelers ponying up to keep dry, while police are scrapping plans to deploy a drone to keep watch over the crowd for the first time.
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Even in the wake of a crushing bear market, crypto traders are looking to invest in virtual currencies. Are there any tradeable setups at current levels? Let’s find out
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It’s been over a year since the Cboe and CME listed the world’s first bitcoin futures contracts, the first ever bitcoin investment product to hit the legacy market. Both futures went live just before bitcoin peaked at its $20,000 all-time high. Out-the-gate trading for the derivatives reflected 2017’s market mania, and Cboe’s futures alone traded over 800 contracts (roughly $12,000,000 at the time) within the first two hours of their launch.
With the creation of these markets, the euphoric anticipation of bitcoin’s debut on Wall Street conjured up delusions of grandeur. The seemingly unstoppable asset, which had transcended all-time high after all-time high with ease all throughout the 2017 holiday season, was on the cusp of receiving its largest flush of capital yet.
Cue 2018 and the bear.
Now, bitcoin is down about 80 percent from its all-time high. Its introduction into mainstream institutional markets obviously did not send us to a new paradigm, and some in the community even believe that the futures invited the opposite effect — that they were the cause of the crash.
2018 was not the year of institutionalization that some bitcoin investors hoped that it would be. Instead, it’s been a Sisyphean struggle to give Wall Street an easier in, perhaps best exemplified by the industry’s repeated trial and failure to get an ETF approved by the United States Securities and Exchange Commission (SEC).
Still, there are a handful of outstanding deadlines and tentative launch dates that could make 2019 the actual year that bitcoin makes headway in the institutional investment scene. The products related to these deadlines include two futures offerings and VanEck’s long-anticipated bitcoin ETF.
For these products, here are some dates to look out for and a brief explanation of how they work.
ICE’s Bakkt: January 24, 2019
The Intercontinental Exchange (ICE), the New York Stock Exchange’s parent company, first announced Bakkt in August of this year. Described “as a scalable on-ramp for institutional, merchant and consumer participation in digital assets” by its CEO Kelly Loefller, the platform was pitched as a crypto payment solution with an added bonus: physically delivered futures contracts.
Unlike current futures products offered by the Cboe and CME, which are not physically delivered and settled in cash, Bakkt’s contracts would be settled in kind with bitcoin. Originally anticipated to launch in November of 2018, the platform has been delayed until the tentative date of January 24, 2019.
Bakkt’s team delayed the launch to hammer out customer customer onboarding and work with regulators on approval. It should be noted that, as of this writing, Bakkt has not received regulatory approval from the United States Commodities and Futures Trade Commission (CFTC) to list the futures.
VanEck/SolidX Bitcoin ETF: February 27, 2019
Fewer institutional grade investment products have bathed in the industry limelight quite like the VanEck and SolidX bitcoin exchange traded fund (ETF).
The latest in a slew of attempts by various actors to offer the world’s first bitcoin ETF, the VanEck SolidX Bitcoin Trust is the only bitcoin ETF introduced in 2018 whose filing hasn’t been decided on by the SEC. Unlike most of its 2018 predecessors, the ETF would source its prices from the bitcoin spot market — not the Cboe and CME futures markets.
The SEC has delayed its decision on the VanEck SolidX ETF twice, but come February 27, 2018, it will have to make a decision, though in reality one could come sooner than this.
In addition to this ETF, the SEC will also have to make its final decision on nine other ETFs which, after being rejected at the staffing level, were appealed for review by the commission. At the time of publication, no dates have been disclosed for when this decision might take place.
Nasdaq’s Bitcoin Futures: Q1 of 2019
Nasdaq teased the prospect of launching its own bitcoin futures throughout 2018, and, as we head into 2019, the exchange is looking to make good on its promises.
But these promises are still a bit nebulous. The exchange hasn’t released many details regarding how the futures will operate, nor has it given much information on the launch date. We do know that their tentative launch date is expected to fall in Q1 of 2019, and Nasdaq has partnered with VanEck to source prices with VanEck’s MVIS Bitcoin Index.
Like Bakkt’s own futures, Nasdaq has yet to receive the greenlight from the CFTC to list the futures.
Photo by Scott Webb on Unsplash
This article originally appeared on Bitcoin Magazine.
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According to software engineer Jameson Lopp, Bitcoin could make the transition to an anarcho-capitalist society possible
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By DAISUKE WAKABAYASHI from NYT Technology https://nyti.ms/2SsV0nG
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After many years of flying high, mighty tech stocks have come tumbling down because of regulatory worries and slow growth. Their bad year affects companies that seemingly have nothing to do with tech.
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Stellar’s co-founder questions validity of nine out of ten crypto projects
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The operator of the NYSE says timing for Bakkt’s daily Bitcoin futures contract will be announced in early 2019
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By DON CLARK from NYT Technology https://nyti.ms/2Qfknr1
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Regulators in India are looking at crypto regulation “with due caution,” says gov’t minister
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DHS investigates cyberattack which disrupted newspaper delivery for the Los Angeles Time, Chicago Tribune, Baltimore Sun
Tribune Publishing first detected the presence of malware in its computer systems on Friday and then took steps to fight back, but it was too late and publishing was already disrupted; Matt Finn reports from Chicago.
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Intercontinental Exchange’s Bakkt announces the completion of its first funding round, raising over $180 million
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Fortnite's Ninja was 2018's most viewed Twitch Channel, hands down
For gamers, 2018 was the year that Tyler "Ninja" Blevins achieved a level of celebrity rarely seen in the industry up to this point.
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A man was arrested on suspicion of causing a public nuisance after a 30-minute closure.
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Yet another tool is being added to Bitcoin’s growing number of privacy solutions.
Thought up at a brainstorming event attended by Bitcoin developers and privacy researchers last summer, Pay to Endpoint (P2EP) is a relatively new trick that utilizes the well-known CoinJoin mixing technique to make blockchain analysis much harder. An early version of it, called “Bustapay,” was quickly implemented by independent Bitcoin developer Ryan Havar and is being tested as of now. Meanwhile, the privacy-focused Samourai Wallet as well as JoinMarket developer Adam Gibson are working on two P2EP projects of their own, which are getting closer to deployment too.
“Privacy is essential for Bitcoin,” Havar told Bitcoin Magazine. “Ideally we want to screw up [blockchain] analysis so badly, that they can't even make it.”
CoinJoin
To understand P2EP, let’s first recap what CoinJoin transactions look like, and why they are (and aren’t) useful.
Many normal Bitcoin transactions send coins from several addresses (inputs), because the sender’s addresses individually don’t contain enough coins needed for the payment. This is very helpful for blockchain spies, as it usually means that all inputs in a transaction belong to the same entity. It allows for address clustering.
But by combining several transactions into one big transaction, CoinJoin — a privacy solution first proposed by Bitcoin Core contributor Gregory Maxwell — has the potential to break this assumption. If multiple senders cooperate to create a single transaction that sends coins from all of their inputs to the different receiving addresses (outputs) they’re paying, blockchain spies would be wrong to assume all inputs belong to the same entity. As such, they can’t just assume it, even if it is a regular transaction. It would make address clustering, and thus blockchain analysis, significantly harder.
However, CoinJoin also has its limitations. If all CoinJoin participants don’t use equal amounts, it’s easy to puzzle together which inputs are paying which outputs. As such, it doesn’t really prevent address clustering after all.
CoinJoin is still useful for mixing, which can easily be done with equal amounts. Users don’t pay other users, but rather, themselves. This is effective in breaking the trail of coins, but it does give away that a mixing session took place.
“While it ‘clears your history,’ it is not as useful as people imagine,” Havar argued. “Your coins are obviously and intentionally washed. That makes it problematic to use. Try depositing your post-mixed coins into an exchange, for example, and watch when they lock your account and ask you a lot of questions.”
CoinJoin’s potential to break the assumptions used for addresses clustering had not really been realized yet. But this may be about to change.
P2EP
P2EP is a relatively new idea, first proposed by participants of a brainstorming event for Bitcoin developers and privacy researchers last summer, who published the idea in several blogs. It cleverly works around CoinJoin’s “equal amount” limitation, opening up the possibility to use CoinJoin for regular payments — not just mixing specifically.
The central concept behind P2EP is simple yet effective: the receiving party in a payment takes part in the CoinJoin. If Alice pays Bob, Bob participates in Alice’s CoinJoin transaction to him, so he also pays himself.
Say, for example, that Alice wants to send Bob 1.2 BTC. She may send it from two inputs: one that contains 1 BTC and one that contains 0.5 BTC. This adds up to 1.5 BTC, which means she also sends 0.3 BTC back to herself as change in the same transaction.
With P2EP, Bob adds one input of his own in the mix: let’s say it contains 0.9 BTC. As such, the transaction now has three inputs worth 1, 0.9 and 0.5 BTC, for a total of 2.4 BTC. The transaction also has two receiving addresses, worth 2.1 and 0.3 BTC. The 0.3 BTC is still the same change going back to Alice, while the 2.1 BTC really consist of the original payment of 1.2, plus the 0.9 that Bob is sending himself. While the transaction has some padding, Alice still just paid a total of 1.2 BTC to Bob.
Importantly, not all inputs in this transaction belong to Alice, and it’s no longer obvious that a CoinJoin took place: there are no matching “sending” and “receiving” amounts to link addresses together.
“The on-chain structure of a P2EP payment is exactly like a normal transaction. So, at certain points, spies know their analysis is corrupted, but they don't exactly know how. Ideally, we want to screw up the analysis so badly, that they can't even make it,” said Havar.
Bustapay
Havar is the previous owner of Bustabit, an online gambling game, and has plenty of experience in the Bitcoin casino space in general. This is how he got a firsthand taste of Bitcoin’s privacy and fungibility issues: Several exchanges blacklist coins that are associated with gambling sites.
“As a casino operator, you want to help protect the privacy of your players,” Havar explained. “So I implemented a huge amount of privacy oriented features, but each time I was kind of surprised how ineffective it was. Bitcoin truly leaks a lot more information than you'd expect.”
Havar sold Bustabit earlier this year and got interested in P2EP when he read about it last summer. He got to work and first announced the Bustapay implementation in late August 2018: a basic version of P2EP.
While intentionally keeping it simple, Havar believes he has improved on initial P2EP proposals in particular when it comes to denial-of-service prevention (where someone indicates an intention to make a payment but doesn’t) and privacy (spies can use the denial-of-service trick to learn which addresses belong to the payee). In both cases, Havar’s solution lets the payee claim a regular payment if the payer bails on the P2EP payment. This makes the attacks expensive — perhaps too expensive to be worthwhile.
Havar hopes the implementation will be adopted by wallets and services, but he did note interest has been limited so far.
“I tried to reach out to most wallets — but there's largely apathy,” Havar said, realizing Bustapay suffers from a “chicken-and-egg” problem. “For any wallet developer, there's a million things to do, and who wants to implement a protocol no one supports? Meanwhile, when I talk to several big bitcoin businesses, no one wanted to implement a protocol that no wallets support.”
Still, one service has now implemented Bustapay: Bustabit, the casino game Havar used to own, and which he himself believes might even be the biggest one on the internet. To keep things moving forward, Havar put out a call for testers and even offered a small reward last week, while also proposing wallet developers should get a piece of a five-year-old “CoinJoin bounty fund.”
With these tests, Havar hopes to learn how effective the implementation really is.
“Someone with Chainalysis access is giving me information about its effectiveness,” he told Bitcoin Magazine, “so I can kind of see how well it works, and how confused it gets.”
Stowaway and Payjoin
It turns out Bustapay is not the only P2EP project.
Inspired by a much earlier idea by Maxwell to disrupt blockchain analysis, privacy-focused Samourai Wallet revealed in September it has been working on a P2EP-type of solution, too. Based on guidelines by data analyst LaurentMT, the wallet had started working on the solution even before last summer's privacy brainstorming event and has been running private tests since. Dubbed “Stowaway,” the feature will enter a public testnet phase within weeks.
Samourai Wallet’s implementation does have one big difference from Havar’s implementation, however, and will, therefore, be incompatible.
“I'm happy to see Bustapay move forward, but personally I'm a bit put off by the the lack of ‘permissions’: It grants anyone the right to obtain knowledge about part of my UTXO [Bitcoin address] set,” pseudonymous Samourai Wallet developer “Samouraidev” told Bitcoin Magazine.
Stowaway will, therefore, only work between Samourai Wallet users that have indicated through the application that they have a trust relationship with each other.
“Users have to ‘follow’ one another and, in addition to that, provide that extra ‘permission’ to allow their UTXO set to be exposed,” said Samouraidev. “For example, I might have a basic two-way relation with my employer to receive [a] salary, but I do not want my employer to solicit me for collaborative spends, which would expose my UTXO set to him.”
And just a couple of days ago, a third P2EP project was revealed. Privacy-focused Bitcoin developer Adam Gibson is implementing a solution called “Payjoin” for another CoinJoin-based privacy project: JoinMarket.
Like Stowaway, Payjoin is specifically designed to be used between users’ wallets. Where Bustapay is developed with online merchants in mind and is available for anyone that wishes to make a payment, Payjoin would only be used when two users specifically choose to do so.
“With Payjoin you're not passively waiting for arbitrary people to ping your server, so you don't have to worry about snooping attacks,” Gibson explained. “You exchange payment details and you end up with a transaction that looks like an ordinary payment.”
Having been part of the brainstorming session where P2EP was formalized, Gibson has been aware of the solution for a little while; in August, he was even among the first to explain it publicly in a podcast. But he said he’d only recently realized the full potential benefit of the trick. Besides privacy, P2EP also positively impacts Bitcoin’s UTXO set, as more unspent coins end up held by fewer addresses.
Gibson, therefore, started working on PayJoin about a week ago and said that implementing it is relatively easy, as JoinMarket wallets already communicate with one another anyway. He thinks he could have a working implementation ready to be integrated into JoinMarket within a few weeks.
“I initially kind of dismissed this idea offhand as not getting enough usage,” he said. “That's, of course, still likely true. But the main reason I decided to devote a bit of time to it in JoinMarket is everything is set up for that already: anonymised Tor connections between counterparties, encrypted messaging, etcetera. So, even if hardly anybody uses it, it acts as a showcase for other wallets and systems in Bitcoin to let them think about it.”
Photo by Patrick Fore on Unsplash
This article originally appeared on Bitcoin Magazine.
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This article was originally posted on Ethereum World News - an independent news provider covereing Ethereum, Bitcoin, Ripple, Litecoin dApps, start-off ICO’s and the whole Blockchain [...]
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In a demonstration titled “Wallet.fail,” a team of security researchers hacked into the Trezor One, Ledger Blue and Ledger Nano S. Unfortunately, it appears as if their findings were first put on display at the 35th Chaos Communication Congress (35C3) in Leipzig, Germany, rather than through accepted Responsible Disclosure practices, which would have allowed the manufacturers to patch the vulnerabilities and protect their customers from any potential attack. Fortunately, the vulnerabilities appear to be very difficult for attackers to actually exploit.
The team of experts included security researchers Dmitry Nedospasov, Josh Datko and systems engineer Thomas Roth. Among the vulnerabilities revealed in the presentation were several that could have been fixed with a firmware upgrade on the hardware wallets in question.
SatoshiLabs, the manufacturers of Trezor wallets, through its Chief Technology Officer Pavol Rusnak, insisted that the company had not been notified about the vulnerabilities demonstrated at the event, going on to add that there's a "Responsible Disclosure program" that the researchers could have followed to give them a heads-up about the loopholes.
"With regards to #35c3 findings about @Trezor: we were not informed via our Responsible Disclosure program beforehand, so we learned about them from the stage. We need to take some time to fix these, and we'll be addressing them via a firmware update at the end of January."
Ledger took the same exception, claiming in a blog post to have been sidelined by the researchers, who could have notified them through a disclosure, which they claim would have given the firm the time needed "for the vulnerability to be patched as well as to mitigate risks for users."
The Vulnerabilities
As for the vulnerabilities themselves, it appears that they cannot (yet) be exploited remotely; most of them require that the intruder have physical access to the devices in question — and sometimes access to the owner’s computer as well.
At the presentation, the security experts claimed to have flashed a Trezor One hardware wallet, which allowed them to extract the mnemonic seed (and PIN) from the RAM, going on to add that the vulnerability can only be exploited against users who don't set a passphrase.
The team also claimed to have installed their firmware on the Ledger Nano S, allowing them to manipulate the wallet by signing transactions remotely. To do this, the intruder would have to physically access the Nano S and hack into the victim's PC, where malware is installed to steal the PIN once the victim loads Ledger's Bitcoin app.
Ledger claims that since this scenario requires an intruder to have physical access to the device, access to the victim's computer and the patience to wait for the victim to put in his PIN and launch the Bitcoin app on the PC, this type of attack is unlikely to pose much of a practical threat.
The security researchers also demonstrated a proof-of-concept, side-channel attack on Ledger's most expensive hardware wallet, the Ledger Blue. According to the team, Ledger Blue leaks signals sent to its touchscreen as radio waves, making them vulnerable. This is due to the animation of the PIN keyboard. The researchers claim the signal could get stronger when a USB cable is attached to the device, allowing them to sniff the PIN of the Ledger Blue remotely.
This article originally appeared on Bitcoin Magazine.
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Bitcoin’s reported average daily price change this year is the lowest value in the past 9 years
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Chinese schools enforce 'smart uniforms' with GPS tracking to surveil students
Ten schools in China have new "intelligent uniforms" that will track students' attendance and whereabouts with embedded computer chips.
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