Bitcoin, as the first successful blockchain implementation, is not an unprecedented breakthrough, but it is the first to be applied and adopted at a global rate. The blockchain technology comes from a history of cryptography and security research. The Merkle Tree and distributed hash tables, hit upon in the 1970s, meant autonomy, fault tolerance and scalability for distributed systems. Bitcoin built upon this loose tradition.
If it weren’t for those tools, the world would not have BitTorrent, Napster and Freenet, all of which are used in great deal by the modern web user. What Satoshi Nakamoto did first was combine these above-mentioned distributed communications systems and file sharing systems with the notion of digital currencies, many of which had been tried and failed leading to Bitcoin.
Hashcash, a key component of Bitcoin, was proposed in 1997 as a means of limiting and suppressing email spam and denial-of-service attacks. Hashcash, an algorithm requiring the sacrifice of processing power as a security mechanism, is a proof-of-work that creates the incentive structure and network verification that now powers cryptocurrencies. The hashcash proof-of-work algorithm requires a certain amount of work to compute something.
Smart contracts are a much theorized possibility for the blockchain. Smart contracts, the notion of which first written by bitgold theorizer Nick Szabo in 1993, are algorithmic. The smart contract, albeit mostly theoretical at this point, is a self-executing code for complicated asset transfers and the exchange of rights. A “smart contract” can be written and made to execute at a certain time in the future. This is an exciting possibility in the minds of the Bitcoin enthusiast, though not everyone sees the purpose.
The largest benefits of the blockchain are its security applications. Unknown variables – such as people – can transfer data and value securely thanks to cryptography, distribution, peer to peer, and open source. There’s no need for them to know each other, as identities – or non-identities – can be confirmed via cryptography.
After the implementation and development of Bitcoin, projects like Ethereum came about. Today, so-called “middleware”, such as ConsenSys, which seeks to enable new services and businesses models atop a blockchain. ConsenSys seeks to solve identification, acquisition, and other problems.
One of Bitcoin’s biggest assets is the fact that it gained first mover advantage in 2008 when it was first implemented. There are dozens upon dozens of so-called “alt-coins” or digital currencies which were inspired by Bitcoin. One that has been receiving much attention is Ethereum, a Turing-complete application, which hopes to introduce programming capacities into the blockchain beyond Bitcoin.
Guardtime is among the first private blockchains, with cross-vertical programming instead of the RSA digital signatures. A Keyless Signature Infrastructure (KSI) uses hash-function cryptography for signing off on transactions.
Similar to the Bitcoin protocol, KSI uses a blockchain public ledger for data transactions. The project seeks to get rid of key management and third parties.
Inter Planetary File System (IPFS) represents a new internet protocol meant to replace Hypertext Transfer Protocol (HTTP). IPFS seeks to solve some security challenges HTTP cannot.
IPFS uses context-driven storage, self-certification and an incentivised blockchain mechanism. This new “hypermedia distribution protocol,” looks to enable the creation of completely distributed applications, and make the internet “faster, safer, and more open.”
Enigma from MIT, based on the Bitcoin blockchain, strives to allow any code to be encrypted. In the MIT model, data can be stored, shared and analyzed without a third party being privvy. Created by MIT grad students, Enigma seeks to create a marketplace where users are able to sell the rights to use encrypted data in bulk computations and statistics without raw access to the underlying data itself.
“With guaranteed privacy, autonomous control and increased security, consumers will sell access to their data,” the creators suggest in the white paper. “For example, a pharmaceutical company looking for patients for clinical trials can scan genomic databases for candidates. The marketplace would eliminate tremendous amounts of friction, lower costs for customer acquisition and offer a new income stream for consumers.”
Another solution, Colony.io, strives to allow people to create companies online which use the wisdom of crowds and AI. Colony represents a social collaboration for distributed organisations. Users can start projects and build a workforce online. The platform distributes crypto-equity in the form of “nectar” to inspire people to work for the organization.
These solutions are all new, made possible thanks to the revelations of the Bitcoin blockchain. This means new forms of online interaction as well as cybersecurity. As Ben Rossi writes for Information-Age:
A holistic view is necessary to maintain today’s connected world. The past decade of digital transformation across industries has put our lives and livelihoods in data.
Where individuals, businesses and governments are constantly locked in a battle against bugs, fraud and malicious actors, blockchains propose an alternative.
The paradigm shift blockchains represent can offer true data integrity, advanced digital identity systems and a new way for business to offer transparency for audit alongside access for third parties.
Its not just online where the blockchain is making a difference. As CCN.LA recently covered, blockchain cybersecurity solutions could be used to secure UK nuclear power plants via the abovementioned Guardtime.
The Pirate Bay is Hijacking PCs to Stealth-Mine Cryptocurrency
For the second time in as many months, The Pirate Bay has been caught mining cryptocurrency on your computer without consent. The torrent platform was actually test-driving cryptocurrency mining in your browser – no doubt a lucrative revenue stream.
The Pirates Are At It Again
The news was later confirmed by Bleeping Computer, which reported that,”The Pirate Bay, the internet’s largest torrent portal, is back at running a cryptocurrency miner after it previously ran a short test in mid-September.”
Estimates indicate that the scheme has earned the pirates a total of $43,000 over a three-week period.
Users had no way to opt their computers out of being test-driven by the torrent network. Back in September, The Pirate Bay got away by telling people it was just a test. The site’s owners cannot use the same excuse this time around.
CoinHive advises websites to let their visitors know their browser is being used to mine cryptocurrency.
“We’re a bit saddened to see that some of our customers integrate CoinHive into their pages without disclosing to their users what’s going on, let alone asking for their permission,” the company said.
The good news is most ad-blockers and antivirus programs will block CoinHive, given its recent abuses. That means not all visitors of The Pirate Pay were being used as a conduit for mining Monero.
Monero Joins Global Crypto Rally
The value of Monero (XMR) shot up nearly 8% on Friday, and was last seen trading at $94.17. With more than 15.2 million XMR tokens in circulation, the total market cap for Monero is $1.4 billion, according to CoinMarketCap. That’s enough for ninth on the global cryptocurrency list.
Twelve cryptos have now crossed the $1 billion valuation mark. A handful of others have made their way north of $500 million.
Ethereum Notches Two-Month High as Bitcoin Offspring Triggers Volatility
Digital currency Ethereum climbed to a two-month high on Monday, taking some of the heat off Bitcoin and Bitcoin Cash, which have slumped since the weekend.
Ethereum Forges Higher Path
Concerns over Bitcoin created a favourable tailwind for Ethereum (ETH/USD), which is the world’s No. 2 digital currency by total assets. Ether’s price topped $340.00 on Monday and later settled at $323.54. That was the highest since June 20.
At its peak, ether was up 10% on the day and 70% for the month of August.
The ETH/USD was last down 2.2% at $315.02, according to Bitfinex. Prices are due for a brisk recovery, based on the daily momentum indicators.
Fractured Bitcoin Community
Bitcoin and its offshoot, Bitcoin Cash, retreated on Monday following a volatile weekend. The BTC/USD slumped at the start of the week and was down more than 3% on Tuesday, with prices falling below $3,900.00. Just last week, Bitcoin was trading at new records near $4,500.00.
Bitcoin Cash, which emerged after the Aug. 1 hard fork, climbed to new records on Saturday, but has been in free-fall ever since. The BTH was down another 20% on Tuesday to $594.49, according to CoinMarketCap. Its total market value has dropped by several billion over the past two days.
Analysts say that a “fractured” Bitcoin community has made Ethereum a more attractive bet this week. The ether token has shown remarkable poise over the past seven days, despite trading well shy of a new record.
Other drivers behind Ethereum’s advance are steady demand from South Korean investors and growing confidence in a smooth upgrade for the the ETH network. The upgrade, which has been dubbed “Metropolis,” is expected in the next several weeks. Its key benefits include tighter transaction privacy and greater efficiency.
Ethereum Prices Unaffected by ICO Heist
Fin-tech developer Enigma was on the receiving end of a cyber-heist on Monday after hackers took over the company’s website, mailing list and instant messaging platforms. The hack occurred three weeks before Enigma’s planned Initial Coin Offering (ICO) for September 11.
In addition to defacing the company’s website, the hackers pushed a special “pre-sale” ahead of the ICO. While many users realized it was a scam, 1,492 ether tokens – valued at $495,000 – were directed into the hackers’ cryptocurrency wallet by unsuspecting backers.
The irony in all this is that Engima is a cryptography company that prides itself on top-notch security protocols. The company issued a statement that its servers had not been compromised.
Spotting a Well-Made Investment Scam
For every reasonably safe investment, there are 1000 scams and 10,000 reasonably toxic investments. Self-served advertising via social media and search engines exacerbates the problem – people sometimes click ads they think were search results, or, as humans are intended to, simply consumes the content on the screen instead of paying attention to where they’re being redirected to.
In this article we will review a recent example of a well-executed investment scam.
The intended victim, who did not actually get scammed but alerted this author to the hustle, was led to believe that the above image was redirecting to a CNN news article. This is the actual URL the link went to:
Now if you visit com-cat.press, all you see is a directory listing. This site’s entire purpose is to make people believe they are visiting legitimate .com websites, when in fact they are visiting others. It doesn’t always have to be a scam, sometimes it is simple an advertisement, but often enough it is a definite funnel to a scam. In this case, here’s where you wind up, at a place that looks an awful lot like CNN Money:
Again, this is not a real article on CNN. This is promotion for 10Markets.eu.
10Markets.eu is extremely professional looking. The platform looks to capture your details even just for demo trading. Most traders expect hurdles, so one can imagine tons of phone numbers and e-mail addresses entered:
The demo trading screen never loaded for this analyst, but the phone number is fake anyway. Took it from a coffee shop in Germany. Funnily, it appears the German exchange code is 030 in the first place, but you can’t edit that part. They also don’t allow you to visit the site at all if you’re in North America.
The tipster was clever enough to find out if 10Markets.eu was a registered broker or not. They’re not. According to ForexBrokerz.com:
10Markets is a forex and CFD broker that is headquartered in Scotland [sic] and supports the popular MetaTrader 4 platform. It is not licensed by any authority and there is not much information about the trading conditions on its website. What is worse, this broker is present in the warning lists of UK’s FCA, Australia’s ASIC and Cyprus’ CySEC, so we don’t recommend doing business with 10Markets.
There are review websites which help. Regarding 10Markets, we came up with this one.
The tipster happens to have been our own Jonas Borchgrevink. He is equipped with years of experience in website publishing, and this is why he quickly noticed that he was not reading a CNN article. The sad fact is that a high percentage of people who read that article believe it to be real, and a percentage of those people end up getting scammed. As such, here is a checklist for new trading outfits that you haven’t used or heard about before:
- Always try to get phone support right away. Before creating an account. If no one answers or there is anything suspicious, this is a scam.
- Always search for “[EXCHANGE NAME]” + “scam,” and read carefully any results that come up. Most scams could stop at one person if others listened to that one.
- In the US, you can use FINRA to check the legitimacy of an exchange or broker. In the UK, you have FCA. Many countries have sites like these, and it’s important to check the one from the country where the broker does business.
- Use ad blockers at least when legitimately searching for financial solutions.
- Check the URL! For every legitimate exchange website, there are a few fake ones designed to steal your account information.
In The Event That You Spot A Scam
Tattle! Spread the word far and wide, not just so others don’t get scammed, but also to give authorities the jump on the thieves. Otherwise, they may exit and get away with all the money before anyone stops them.
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