My New list

David Floyd  

Ripple's former CTO Stefan Thomas is going up against Ethereum with the launch of a new smart contracts platform.Well, "new" isn't quite right – the platform Thomas released implementations for today is Codius, an open-source project that Ripple released in beta in 2014 but shelved the following year. 

Now, though, having announced his departure from Ripple in May, Thomas is re-launching Codius as the technical backbone for his new company, Coil.Using Codius, Coil aims to change the way websites monetize their content.

According to Thomas, monetizing web content has so far relied on clunky "workarounds" like ads, paywalls and user data harvesting (think Facebook's recent debacle).

But his new project, by using Interledger, an open-source protocol that was developed inside Ripple for sending payments across different ledgers, plans to allow users' browsers to make micropayments to websites they visit.

Codius could enable use cases such as a "revenue disbursement contract," which could take in revenue as people watch a movie and pay that money out to all the parties that made the movie – and not in batch payments, but little by little.

Or a Codius smart contract could help news outlets and their readers interact in that it could manage readers' authorizations and subscriptions "and act as a sort of switching board for your money," Thomas said.

The implementation released today comes with tutorials for uploading and hosting Codius smart contracts (uploaders pay hosts to run smart contracts on their computers), to try and push developers to start using the platform right away.

And already several developers have disclosed they'll be building on the platform, as revealed exclusively to CoinDesk.Telindus, an Luxembourg-based IT solutions subsidiary of the state-owned Belgian telecom Proximus Group, will use Codius to "push forward novel direct e-commerce models," Telindus chief architect Thomas Scherer told CoinDesk.

Josh Williams – who has previously invested in well-known game platforms Unity, Zynga and Kabam – said he'd be using Codius in new ventures, including a gaming company that is currently in stealth.Williams told CoinDesk:

"Teams in games and elsewhere are building on Ethereum and running into the cost and scalability issues we're all familiar with. Codius has great potential in addressing these concerns, and we are eager to work with it."

Thomas echoed that sentiment, saying that as Ethereum has demonstrated the viability of smart contract use cases, it has simultaneously shown the world its own vulnerabilities, as Ethereum-based applications continue to run into scaling difficulties.In contrast to Ethereum, Codius was designed to allow developers to write smart contract code in any programming language and have the smart contracts work as "smart oracles," communicating with outside data sources.As such, Thomas said, Codius has an opening.

"The people that are reaching out to us are saying, 'Hey, we're experimenting on Ethereum. We're running into scalability issues. It's too expensive, too slow. It's not flexible enough. We don't like writing in this awkward language,'" he said.

What's changed? 

So why did Ripple set Codius aside?While Codius generated its share of buzz in early 2015, before Ethereum's mainnet was live, according to Thomas, the idea seemed premature.

Ripple engineers touted the platform as a model for interoperability at the time, saying it was able to handle not just XRP – the cryptocurrency most closely associated with Ripple – but bitcoin, ether and fiat currencies.

But the project hit snags, however.Adding smart contracts opened up new ways to attack the ledger, and the technical architecture was cumbersome. Speaking in 2015, Thomas said that building smart contracts into a blockchain was like writing software directly into a database – difficult.

The team realized, Thomas told CoinDesk in a recent interview, that computer science had solved that problem in the 1970s by developing a three-tier architecture, in which a "logic layer" sits between the database and user interface layers.

Codius would serve as that middle layer, Thomas said, adding, "You would have a bit of code that's accessing some assets on XRP ledger, that's accessing some data that's in Ethereum, and maybe it's making an HTTP call and so you have a much more flexible architecture.

And most importantly you can have those kinds of contracts call other contracts as well."But building that kind of platform required efficient communication between ledgers, something that wasn't available at the time, and so Ripple began developing the open-source Interledger Protocol to allow for this communication.

Plus, Thomas said:

"We just didn't feel like smart contracts was a very mature industry at that point…. Frankly, the use cases seemed somewhat dubious in value."

As such, Codius was shelved. But now, three years later, Thomas' doubts about the value of such a smart contract platform have disappeared.

Rather, he sees Ethereum's scaling issues – expensive transactions and slow confirmation times – as signs that smart contracts are ready "to move away from the mainframes, move away from Ethereum and go over to a more flexible architecture that involves multiple different ledgers."

Ethereum killer?

Codius, though, is hardly the only would-be Ethereum-killer to emerge over the past couple years.All of these projects, like Codius, tout the ability to process faster and cheaper transactions, but there's typically a trade-off involved – either in terms of security or blockchain's defining benefit, decentralization.

EOS, for instance, a delegated proof-of-stake cryptocurrency project which is currently in the midstof launching on mainnet, promises faster, cheaper transactions, because the blockchain only needs to be verified by 21 validator nodes, not by the whole distributed community of miners as in Ethereum and bitcoin.

Thomas, though, argues that Codius' design enables developers to balance their own priorities, rather than having to accept the network's compromises as a given."You can choose the level of decentralization," Thomas told CoinDesk.

"If you upload it to four or five hosts, you'll have a decentralization level that's similar to Ethereum [and] you'll have a cost that's still orders of magnitude lower. Or you can upload it to 100 hosts, and you'll have a much greater level of decentralization than you can get with Ethereum."

As it relates to security, Thomas argues, Codius has several advantages over Ethereum and other smart contract blockchains.For one, the network is built on HyperContainer, an open-source project that uses Docker containers to isolate a given contract's code and minimize its vulnerabilities to attack. And secondly, Codius developers aren't locked into a nascent programming language like Solidity, which they're unlikely to know as well as JavaScript, for example.

"I think that a lot of the issues and compromises, big hacks and so on have been directly related to the fact that these are all new languages whose security's not very well understood," said Thomas.As for price, Thomas contrasts Ethereum's transaction costs – which can exceed 60 cents and even a dollar – with those of Amazon Web Services' Lambda platform, which costs 20 cents per million requests.

 AWS is centralized, but Thomas still expects Codius' costs to fall "between those two extremes."For Thomas, rolling out Codius is the first step towards building a standard protocol for monetizing web content, as well as the ecosystem around it.

Eventually, Thomas believes firms might decide to host websites on Codius rather than AWS, with Coil serving as a kind of "Spotify, but in an open way" – a protocol connecting consumers, internet service providers, websites and content creators.

And while the code is still "rough," Thomas remains optimistic that Codius will prove a step forward for developers writing smart contracts that solve problems for today's businesses.He concluded:

"From a cost, scalability and security standpoint, as well as the flexibility … it's orders of magnitude more viable for mainstream use cases."

Correction: An earlier version of this article stated that Josh Williams worked at Unity, Zynga and Kabam. He was an investor in those companies.

Stefan Thomas image via CoinDesk archives

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Scott Nelson  

Scott Nelson is the chairman and CEO of Sweetbridge Inc., a blockchain tech startup.Race to the bottom or race to reality?

The rise of initial coin offering (ICOs) – as controversial as they may be – is a signpost that the age of Industrial Era capital formation is giving way to a new paradigm of decentralized and democratized investment and customer-driven business models that expand far beyond the borders of any one country.

In this arena, entrepreneurs and companies will naturally gravitate toward the jurisdictions that allow them to raise funds from investors and serve customers around the world in a fast, safe and effective manner and with minimal friction.
Recognizing that this shift to a new Decentralized Era is underway, numerous countries are positioning themselves at the forefront of this transition so as to reap the economic, financial and geopolitical benefits that come with being the go-to jurisdiction for global capital formation.

Unfortunately, the United States is not yet among these countries, as it has instead taken a short-sighted and enforcement-heavy approach that fails to expand beyond Industrial Era thinking.

While U.S. regulators have publicly offered platitudes about being friendly to innovation and facilitating domestic entrepreneurship in the crypto space, the proof is always in the pudding.

In this case, the "pudding" is that serious cryptocurrency projects are faced with two unappealing choices: either issue tokens through outmoded and ill-fitting means that restrict a token's customer base and resale ability – like registering as a security or claiming a Regulation D exemption – or leave the U.S. altogether.

Race to value

As highlighted by CoinDesk, the natural and predictable consequence is that innovators are leaving the U.S. in search of friendlier jurisdictions.To meet this demand, places like Gibraltar, Switzerland, Liechtenstein, Malta and, most recently, Bermuda have been rolling out the welcome mat for token sales and structuring local regulations to balance the goals of industry development and consumer protection.

Some might eye the questionable reputations of some crypto-friendly countries and immediately conclude that there is a "race to the bottom" occurring whereby regulators, in search of revenue and headlines, green-light even the most fantastical token ideas without asking any questions.In our observation, this is not happening.

In seeking to responsibly sell tokens to customers, my company, Sweetbridge, has spent a substantial amount of time in discussions with regulators from around the world -- including representatives of many G20 countries. And we've been encouraged by the thoughtful approaches and due diligence that has been demonstrated.

While there will surely be instances of this type of jurisdictional arbitrage employed by fringe actors, no serious crypto project wants to domicile in a country where anything goes.

Instead of a race to the bottom, we see a race to quality where serious projects flock to the places that offer the best overall value proposition: the best legal expertise, the best balance of regulatory controls with innovatory freedom, the best technologists and the best branding – even if cheaper (and possibly seedier) services can be acquired elsewhere.

For example, Switzerland's appeal is not just the regulatory aspect but also the talent and support ecosystems that it has developed concomitantly. Other jurisdictions like Gibraltar are going one step further by establishing not only guidelines and requirements for companies launching ICOs, but launching a fully-regulated exchange providing listing and liquidity for projects launching there.

Follow the leader

Countries large and small are beginning to heed this message.While still grappling with the best way to tackle this new business model, many are rethinking outmoded approaches to capital formation – particularly the idea that token issuances are necessarily investment contracts.

They see an opportunity to inject fresh life into their local economies and potentially shake up the global balance of financial power.

To put it simply: they aren't stupid.Should they wake up to see billions of dollars of real economic value being created in places Liechtenstein and Gibraltar while the U.S. chases its own tail deciding whether or not ether is a security, they're going to find a way to get in on the act – and with haste.

Royal opportunity

In Sweetbridge's view, the sleeping giant in this conversation is the United Kingdom.

The Brits have long been eager to wrestle the title of world's premier financial center away from the U.S. and recrown the City of London, and there is a growing sense within governmental ranks that blockchain and financial technology may be the ticket to doing just that.

While the U.S. lacks impetus for change, Britain is looking for relevance in a post-Brexit world. Thus, its traditionally conservative financial culture has expressed an introspective openness to new ideas.

For instance, the Fintech Regulatory Sandbox recently launched by the Financial Conduct Authority, Britain's top financial regulator, gives challengers and innovators a way to launch without prohibitive compliance costs.

The Brits also understand the consequences of failing to capitalize on paradigm-shifting economic transitions.Despite birthing the Industrial Revolution, they grew too comfortable in their colonial Agrarian Era societal structure and ultimately forfeited dominance of the Industrial Era to the U.S. because they were unable to adapt quickly enough.

Additionally, the legal structure of the British Commonwealth is relatively amenable to new means of capital formation. It is predisposed to a "buyer beware" approach toward these types of products, as opposed to the paternalistic mentality of the U.S. that ensures only rich people get access to the good investment deals (unless that "deal" happens to be offered by a state-sponsored lottery).

Certainly, not all innovative crypto projects will abandon the U.S., but it has become disappointingly clear in recent months that there is too much inertia built up around its regulatory infrastructure for it to play top dog in the coming era of decentralized business models and global capital formation.

Fleeing image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

https://www.coindesk.com/real-reason-token-issuers-fleeing-us/

By Nathan Reiff 
EOS has long been one of the most hotly anticipated cryptocurrencies to hit the scene.

Block.one, the development team behind the project, launched a year-long initial coin offering (ICO) to support the project, raising $4 billion in the process. Investors and others in the digital currency community have waited for months for a June launch date. Now, with that date having passed, there are issues that continue to plague the popular digital token ecosystem.

Who Runs the Code?

Part of what has made EOS stand out among a crowded field is the unique model its developers have created for the management of the blockchain ecosystem. Investors who bought up ERC-20 tokens during the ICO had their purchased tokens converted to EOS currency on the EOSIO platform on June 2.

Those investors holding native EOS tokens are responsible for the management of the entire ecosystem, according to reporting by Coin Telegraph. This process is set to be accomplished via voting for block producers, which will help to maintain the network.

At the same time, the project developers intend for the EOSIO network to support decentralized applications, which will also be linked to the native EOS tokens in a proportional manner. The more tokens staked in the application, the more resources available to that app.

Hundreds of Issues Remain

The EOS Github page suggests that were about 620 bugs and other issues that remained unresolved as of earlier this week, following the official token swap and launch. While resolving these problems sounds like a daunting prospect, more than 1,400 issues had already been resolved during development as of that time.

Perhaps the more significant issue now is that block producers are working to run the code, which is available to the public, but the blockchain is still not live. As the process continues, more glitches could reveal themselves. At the same time, Block.one is purposefully leaving itself out of the process.

The developers likely anticipated growing pains for their project, which aims to take the concept of decentralization to a level few other cryptocurrencies and blockchain networks have explored.

Assuming that the group of investors, block developers and other supporters of EOS will be able to determine how to best run the ecosystem through a lengthy process of trial and error, it may be that the product that emerges opens doors which have as yet remained closed in the digital currency realm.

Investing in cryptocurrencies and Initial Coin Offerings ("ICOs") is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or ICOs.

Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author owns bitcoin and ripple.

Read more: What's the Matter With EOS, the Cryptocurrency? | Investopedia https://www.investopedia.com/news/whats-matter-eos-cryptocurrency/#ixzz5Hhds1bh1 
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One of the hallmarks of most digital currencies is extreme volatility. Frequent and significant price fluctuations were a concern particularly in the earliest days of some of the major cryptocurrencies, but the phenomenon continues up to this day.

One need look no further than the largest digital currency in the world, bitcoin (BTC), to see evidence that this is the case; in late 2017, BTC rose to a record high of almost $20,000 per coin. By just a few weeks later, it had plummeted to roughly a third of that value.

Price fluctuations don't just occur on a larger time scale such as this one, stretching out over weeks and months. In fact, they also take place from second to second as well. It is this fact that has allowed some criminal operations to benefit from flash crashes of popular digital currencies, buying up the hottest tokens at low prices and then selling them once the prices are corrected.

Now, a new trend has caused the cryptocurrency community concern as well. Called "spoofing," it is the process by which criminals attempt to artificially influence the price of a digital currency by creating fake orders.

A Spoofing Primer

As with all tradable securities, the price of a digital token depends on many factors, among them the overall sense of optimism or pessimism pervading the broader market and individual investors. While this sense of the momentum and potential of a cryptocurrency can be difficult to quantify, it is nonetheless something that savvy investors are highly attuned to.

Because of the impact that a feeling of optimism or of pessimism can have on a group of investors' tendency to buy or sell that digital currency, these concepts are critical to the price of that token, even if they remain somewhat elusive.


It is the fact that these sentiments are elusive that allows spoofing to be possible and effective. Traders wishing to manipulate the market for a given cryptocurrency can create the illusion of optimism or pessimism by initiating fraudulent buy or sell orders.

When traders generate these orders without the intention of filling them, they trick other investors into either buying or selling, and the price of the cryptocurrency stands the possibility of being adjusted accordingly. The trader cancels the orders once the price of the cryptocurrency moves in the direction he or she desires.

Spoofing in Practice

Bloomberg reported on an investigation by the U.S. Department of Justice (DOJ) launched to determine whether cryptocurrency price manipulation had taken place in the bitcoin network as a result of spoofing.

According to the report, authorities at the DOJ are concerned that exchanges around the world have taken an active approach to pursuing traders engaging in spoofing.

It may be that the investigation is focused on bitcoin not only because it remains the largest digital currency by market cap, but also because its massive price increases late last year drove hordes of new amateur investors into the space.

These investors, keen to make what they see to be easy money off of a digital currency that seems destined for stratospheric heights, may be the most susceptible to spoofing.When spoofing does take place, it often is accompanied by wash trading.

Wash trading is similar to spoofing in that it aims to manipulate the price of a digital currency by artificial means, although the means of implementation are different. In wash trading, a cheater trades with him or herself in order to create the illusion of market demand, thereby luring unsuspecting investors into entering trades as well.

University of Texas finance professor John Griffin believes that the cryptocurrency space is particularly susceptible to spoofing. He explains that "there's very little monitoring of manipulative trading, spoofing and wash trading" in the cryptocurrency world, adding that spoofing the market and illegally manipulating prices "would be easy."

Guarding Against Spoofing

How is an investor best able to protect herself from investing in a digital currency while spoofing is taking place? Overall, caution is the central approach for many investors.

It's best to beware of opportunities that seem too good to be true, and it's also worthwhile to ensure that any exchanges you trade on are vigilant to the possibility of fraud of all types, including spoofing and wash trading.

At the same time, some exchanges are looking to ramp up their security and monitoring systems in an effort to guard against spoofing and protect customers.The Gemini exchange, created by Cameron and Tyler Winklevoss, for instance, has recently announced a partnership with Nasdaq to conduct surveillance of digital token trading.

Ultimately, even the most vigilant investors can still be susceptible to price manipulation in the digital currency world. For that reason, it's crucial to keep in mind that this space remains a highly speculative one, and that digital currencies are not the be-all and end-all of any investment strategy.


Read more: What Is Cryptocurrency Spoofing? | Investopedia https://www.investopedia.com/tech/what-cryptocurrency-spoofing/#ixzz5Hhd1wNXo 
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Blockchain technology has been keenly taken up by the financial services sector, but any sector that involves transactions could benefit

Several industries are dominating early experimentation with blockchain technology and it’s no surprise that the financial services sector has taken an interest.

Bank of America (BAC) and Mastercard (MA) have filed for dozens of patents between them, and technology companies like IBM (IBM), Apple (AAPL), Intel (INTC), and Accenture (CAN) have accumulated patent filings in the double digits.

Applications are not limited to these two sectors, however. General Electric (GE), Walmart (WMT), and others have joined the rush to create proprietary blockchain applications.As with any emerging technology, the bulk of investment activity is occurring at early-stage companies.

Excluding enterprises that have funded themselves via token offerings, companies using blockchain technology have raised billions in venture capital funding, with dozens having raised more than $10 million.Companies such as R3, Ripple, Chain, Ledger, and Digital Asset may not yet be household names, but these well-funded firms are increasingly working with companies that are.

 The investment activity of the largest public companies and venture capital firms is consistent with our view that there are a handful of immediate-use cases for the technology.

Most of the activity is in financial transactions, though other applications are arising. R3 has produced an open-source distributed ledger product that enables a variety of financial applications. Digital Asset’s offerings are similar, in that a permissioned blockchain is used to avoid some of the privacy and regulatory issues associated with public blockchains.

Ledger provides security solutions for cryptocurrencies. Ripple is focused on cross-border payments, enabled by using its own digital asset, XRP. Blockstream is developing a variety of sidechain applications.

New Asset Class Being Created

Steem is an interesting experiment outside the financial services sector. It produced a crypto-based social publishing platform along the lines of Reddit. Users earn financial rewards in cryptocurrency rather than “likes”. Canaan Creative has produced specialised bitcoin mining hardware.Venture capital firms and publicly traded companies are not the only source of funding for blockchain projects, though.

The technology has made possible a completely new asset class, as ventures raise funds by selling digital assets. These initial coin offerings, or ICOs, have resulted in several billion dollars in funding for blockchain projects in the past year alone.

ICOs have produced even more speculative activity on average than the venture capital space, with large amounts of money have been raised by ventures.

As a new, highly speculative asset class, ICOs have generated significant regulatory attention, with some parties engaging in outright fraud as fundraising activity skyrockets.That said, there have been notable ICOs with viable product plans and talented teams, and sophisticated investors have backed some of them.

Ethereum and Filecoin, for instance, provide distributed computing. PitchBook has developed a seven-factor framework for qualitatively assessing initial coin offerings.

As well as factors common to other early-stage ventures – market opportunity, founding team, key milestones, and legal/regulatory considerations – PitchBook suggests analysis of the incentive structure, token classification, distribution, purpose, and potential network ecosystem.


The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within.

Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision.

Please contact your financial professional before making an investment decision.

http://www.morningstar.co.uk/uk/news/167955/blockchains-influence-spreads-beyond-finance.aspx