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Cloud Computing & Cryptocurrency

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We are starting to see a rebound in BTC and ETH. We touched 1180 ETH as of this writing, and I am in a happy spot now after the news that Robinhood will allow trading of stocks and cryptocurrencies (ETH and BTC) in the same account. Please make sure you are exposed to ETH if you’re investing in these markets. Now more than ever is it important for coins to have working business relationships.

However, everyone must be weary of hearing big names, and not looking at what these names are actually buying. I have recently become fascinated with the cloud computing relationships that certain cryptocurrency companies have. What I find incredibly frustrating is how amazing these things are, and that I have absolutely no stake in it. I am going to use Microsoft and Stratis as my example, and if this is of interest to everyone I will do IBM and Stellar next.

Why is this Important?

Storage and analysis of information is one of the biggest costs to any company. The amount of data that a business compiles – financials, supply chain data, internal information sharing etc. – has become larger and larger each year. The cloud is a solution that allows access to remote data storage and applications via the internet, rather than having it stored locally (hard drives/local servers) that require large upfront investment and costly on-going maintenance. The clouds became flexible toward certain patterns (Black Friday, tax season, etc.), and will shift in size and cost based on the amount the company needs, rather than having excess capacity of local servers year round.

Companies did not have to take on the cost burden of local servers, and the scalability was more than enough to fit almost everyone’s needs. These clouds have evolved into the public sector as well. Individuals can now store their information (iCloud would be a familiar one) in a way that protects them from any hardware malfunction. Applications that we use have our activity information stored “in the clouds” as well.

How does your cryptocurrency get involved? They are the ones creating the file cabinets. One of the main problems associated with cloud computing is securing sensitive information. Many old school IT folks are still concerned that storing information on the cloud increases the risk of theft of sensitive information. Blockchain is a sophisticated way of providing extra armor within the cloud – in other words, encrypted information in blocks rather than just information itself.

The big players are Amazon, Google, IBM and Microsoft, each with their own different spin. Two of the companies, Microsoft and IBM, have become CaaS (cloud as a service) solutions, with a BaaS (blockchain as a service) added within.

Microsoft Azure is a cloud solution that was released in 2010. It provides a hybrid (public/private) cloud to corporations and individuals. Microsoft is able to store, automate and infer all of the information gathered by businesses in a much quicker way. Their applications are becoming stronger each day and are beginning to have real world use cases.

I am not from the tech background, but the consensus is that this Azure platform is one of the easiest to understand if you’re used to developing on Linux, which describes most developers. Azure is an easy transition. Their recently implemented BaaS is where Stratis enters the conversation.

Stratis prides itself on being the “status quo” blockchain maker. The software was designed to work with corporate America’s operating systems (OSX/Windows) through nStratis, which is a private “side chain” service for businesses and individuals. This means that when companies want to secure their information on the cloud, the early consensus is that blockchain is the best way to do so. The Stratis company was designed for Microsoft systems, and the people who are used to them. It was an excellent play on Stratis’ part to notice that cloud computing, and specifically Microsoft, would be the segment that would adopt their products and service first.

I would say Stratis is going to have a lot of work through these relationships. Side chains for private storage are what normal corporations are looking for, not cryptocurrency solutions. We raised money for Stratis through STRAT so that they could do this. However, I don’t see how their side chain business will reward coin holders.

Stratis probably has the best competitive advantages of all cryptocurrencies in that it plays well with Silicon Valley coding languages and has a knack for building a great private chain. But, where is the coin holder value? I would love to own some Stratis stock, in which I have ownership of the underlying company and receive profit. But that isn’t what this is.

Conclusion

This is the frustrating part about cryptocurrency. The lines have been greyed surrounding what is going to benefit the coin, and what isn’t. Rapid payment and processing has about 100 new coins coming on the market each month, usually with nothing more than the same coin properties as everyone else.

Microsoft has the largest technical reach of any company through its corporate monopoly. Windows and Microsoft Office are simply too imbedded in businesses’ lives for there to be a change in demand over the next 3-5 years. I believe that with the languages that Stratis can be adopted in, Microsoft will be calling them consistently as more people and businesses migrate their information to the cloud in the most private customizable manner possible.

I would exercise caution on STRAT. I have made a rule for myself that once a coin begins working with companies that will have no relationship to the coin, I will exit. It’s so tough for me to say, as I think this will be a revolutionary IPO in the future. Don’t be one dimensional in cryptocurrency. That is how so many people are being pinched. There are many ways to look at a company in blockchain, and one of them is getting the first look at a revolutionary company before it goes public. Stratis could certainly be an example of that.

 

This is not a recommendation to buy or sell cryptocurrencies. I do not own STRAT anymore. Best of luck to you. Please do follow me on Twitter @raijincrypto for thoughts throughout the week.

 

P.S. I read my last article. Raiden had taken it a little too far with the cloud computing Youtube videos the night before, and clearly wasn’t awake enough to write. Cryptocurrencies take a toll on us all, and I apologize. However! Now, I have some great cloud computing stuff that I am hoping is of interest, and will allow us to take a look at the first commercial uses of blockchain.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.4 stars on average, based on 27 rated postsMythological God of Lightning. Cryptocurrency/Blockchain writer, evangelist, and friend. May the odds be ever in our favor.




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Decentralization

Cache Me If You Can: Crypto Trading, Decentralized

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Spot exchanges, over-the-counter/OTC trading desks, and futures contracts would likely rank amongst the most popular methods for trading cryptocurrencies between two or more parties.

Despite their popularity though, most of these trading venues utilise centralised infrastructure in at least one area of their operations.

When combined with the endemic security threats which crypto trading services regularly face: centralized fundamental functions are a considerable threat to users who value the privacy of their transactions.

“A Peer-to-Peer Electronic Cash System”

Cryptocurrency is still a burgeoning industry, with the number of ICOs and market investment having increased by several multiples even just over the past eight months when compared to the whole of 2017.

Despite this: concerning conventions have already established themselves that challenge the original vision prescribed by Satoshi Nakamoto for Bitcoin.

The enigmatic Satoshi Nakamoto became a legend upon publication of his seminal cryptocurrency white-paper entitled ‘Bitcoin: A Peer-to-Peer Electronic Cash System’ (and if you haven’t read it, you really should!).

Since then, the document has served as an conceptual blueprint which has been referenced by a great number of subsequent altcoins: evident by the widespread implementation of Bitcoin’s core mechanics. An example of this is has come to be known as cryptocurrency mining, or the ‘Proof of Work’ consensus algorithm.

P2P vs  P2intermediary2P?

Peer-to-peer (P2P) denotes transactions that are made between two parties without the need for an intermediary to facilitate or authorise the trade.

Mike Orcutt, associate editor at the MIT Technology Review wrote in April 2018 that:

“The whole point of using a blockchain is to let people—in particular, people who don’t trust one another—share valuable data in a secure, tamperproof way…

“One supposed security guarantee of a blockchain system is ‘decentralization.’ If copies of the blockchain are kept on a large and widely distributed network of nodes, there’s no one weak point to attack, and it’s hard for anyone to build up enough computing power to subvert the network”

Whilst this is true for many blockchains and their associated blocks for decentralized cryptocurrencies: most middle-man’ who process trades and transaction utilise a centralised system known as an ‘order book’ upon which future transaction and trade values are calculated.

In June 2009, mere months after Nakamoto’s Bitcoin paper was released to the world, a cross-departmental team from Stanford University published a related and highly recommended investigation into the contemporary status of the order-book.

The authors state that:

“most markets are order-driven, where any market participant is free to provide liquidity by submitting a buy or sell order. Submitted orders are amalgamated by price to create a limit order book. The[re is a] rule driven execution of orders in these limit order books and [also] extensive data that is available for order driven markets.”

With  a centralised order-boook; all the data pertaining to transactions: such as receiver and sender addresses, value of tokens, and dates could be all-but-publicly accessible in the case of a hack or successful unwanted intrusion.

Peer-to-Peer Trading: What Can Be Done?

One solution which we have seen numerous examples of are organisations which claim to be ‘decentralized exchanges’.

On the 9th of August 2018, for example, well-known yet controversial ex-China based cryptocurrency exchange Binance launched a pre-alpha build of their highly anticipated decentralized exchange which they call ‘DEX’.

Conversely, Binance has been subject to more than their fair share of negative press and public feedback as of late and earning trust for their future projects will be no easy feat. They have to contend with hackers, pundits, and a 5.9/10 ranking on Trustpilot.

Another notable release comes from blockchain development platform Stratis, a competitor to Ethereum’s ‘platform for platforms’ and ranked in 50th place on CoinMarketCap as of writing.

The ‘Breeze Wallet with Breeze Privacy Protocol’ launched on the 1st August 2018, and it is a means of facilitating pure peer-to-peer, user-to-user, fully decentralized transactions. As a result, Breeze hopes to introduce centralized intermediaries to the realm of obsolescence, by way of a token-tumbling protocol called ‘TumbleBit’.

If you know of any more projects which have been making recent progress – please let us know in the comments section!

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Op-Ed

Disrupting the Cloud: ANKR Network

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Since the creation of bitcoin and the introduction of the “Proof of Work” (POW) algorithm, many have been concerned about the vast use of computing power and energy and their negative side effects. Currently, cloud computing is projected to be a trillion dollar market, yet it is monopolized by some of the largest tech conglomerates in the world. Only giants in the likes of Amazon Web Services and Google Cloud can afford the high human capital cost and upfront server costs to run a successful cloud operation that spans the globe. However, the aforementioned companies tend to charge the customer with a higher margin of cost.

New developments in blockchain technology aim to resolve these issues by improving the efficiency and effectiveness of cloud computing. Being an innovative solution to this computing and consumer problem, Ankr Network brings the benefits of decentralization to cloud computing and balances value between buyers and sellers via crypto economics, Oracle service and distributed computing.

Ankr Network

Ankr Network is an innovative platform, which aims to create a resource-efficient blockchain architecture for a distributed cloud computing system and an easy-to-use infrastructure for the building of business applications. Ankr is the first cloud computing solution to leverage both blockchain and trusted hardware of Intel SGXs. The SGX hardware will allow developers of applications to protect data from unauthorized access and modification and preserve the confidentiality and integrity of information.

Technical solutions include:

  • Consensus Algorithm Proof of Useful Work (PoUW)
  • Platform for distributed cloud computing (DCC)
  • Oracle integrated service
  • Structural support for sidechains

The consensus looks like this:

Anrk upgrades mining with its consensus “Proof of Useful Work” (PoUW), which provides a sustainable block structure. Specifically, PoUW directs power and computing capacity which was used on hashes in POW algorithms such as bitcoin for processing tasks provided by businesses and consumers on the blockchain. Therefore, one can say Ankr upgrades mining to a higher level, allowing equipment holders to receive a financial incentive for block creation and real-world tasks processing.

To explain this better, consider the following: the golden standard algorithm is one where the nodes on the blockchain require:

1) That tasks performed to solve problems is actually quantifiable work;

2) That the processing of these tasks provides some form of value to any party on the network

The Ankr Network appears capable of achieving this gold standard. Alternatively, existing POW in networks such as bitcoin and Ethereum only achieve the first point – nodes use computing power and energy to prove that work was done (but such amount of work is wasted without any utility).

Ankr solves this key technical limitation in bitcoin and Ethereum by including a second point in its consensus algorithm, thus making all the work done by nodes directed on the processing of tasks that could bring added value utility to the network participants.

Ethereum processes all smart contracts on one chain in a serial sequence, which bottlenecks throughput and dramatically reduces the usability, especially when there are large contracts with complicated data on the chain. Plasma is a protocol to solve the scalability issue by building a tree structure of blockchains, where various application chains (Child or Plasma Chains) are connected to a single root chain (Main Chain). Plasma chains can allow applications to handle their specific smart contracts transactions on side chains, thus balancing potential overload of the network.

The efficiency of the main chain can be significantly improved by offloading a number of transactions from the main chain to Plasma chains, especially if proper incentives are given to Plasma operators. Currently, Oracle solutions exist separately from the blockchain framework and are limited in compatibility. Ankr proposes a user-friendly universal AP (application programming interface) I for each child chain to connect to off-chain entities. Existing business can build decentralized autonomous applications on the child chain with powerful computing power and native data feed service provided by the main chain.

 

The Native Oracle (NOS) service provides an authenticated data feed by using both cryptographic primitives and a trusted execution environment (TEE). Thanks to a standardized API for transferring data from existing data sources like websites, NOS allows customers to simplify business in the real world. Basically, this means that blockchain can allow integrating smart contract execution with data sources through a protected gateway.

Intel SGX

Intel SGX (Software Guard Extensions) is a new set of instructions that permits execution of an application inside a hardware enclave, which protects the application’s integrity and confidentiality against certain forms of hardware and software attacks, including hostile operating systems. This lowers entry barriers for miners and provides security and privacy.

Distributed Cloud Computing (DCC) Platform

As internet technology advances, massive amounts of data including text, audio, video, etc. have been created. However, most of this data is neither organized nor relevant to each other. Processing the data in a serial sequence (traditional blockchain) becomes less and less resource efficient and can’t be tolerated by the rapid velocity of business development.

Ankr overcomes these shortcomings through its DDC platform, which enables P2P transactions. Miners will provide their computing power to support the blockchain, as well as sending surplus power for cloud computing calculations.

A P2P network allows application owners and individual users (i.e., requesters) to rent computing power from other users (suppliers). Currently, the cloud computing resources in popular blockchain networks such as bitcoin or Ethereum are exclusively controlled by the centralized cloud service providers and are subject to rigid operation models. A decentralized cloud computing platform can incorporate a blockchain-based payment system, which can allow for direct payment among operators (requesters), sellers (suppliers) and software developers.

Now, we will cover what other projects in this field are doing in comparison to Ankr as a reference project.

Golem

Users of Golem are only incentivized for cloud computing and Golem is using third party computing containers like Docker.

SONM

This project is very similar to Golem, but with a different application field. Golem is focused on rendering, but SONM is focused on the adoption of existing architectures (currently server hosting).

IExec

This project is also similar to Golem and SONM, but its application focus is decentralized cloud computing in specific research applications.

In comparison with the projects above, users of Ankr have different incentives that come from mining, transaction (or smart contract) and cloud computing. Also, Ankr does not use third party platforms for computational power; instead, it uses the computing power of miners.

In my opinion, an additional limitation of Golem, SONM, and IExec is that they have based their development on traditional computing architectures, which are used in data centers, thus limiting their potential computing power and scope of tasks. The reason lies in the fact that data center architecture is working on one technical parameter, which is not optimal for distributed computing where the topology of each device changes frequently and will result in a costly overhead in data transfer and decrease the stability of the network. Ankr technology allows bypassing such limitations, which results in a wider applicability and scope of their network.

Overall, if the Ankr network team can create a network that uses PoUW to reach consensus by applying all the computational energy to useful use and not wasting it, then cloud computing services as Amazon Web, Google Cloud and Microsoft Azure are likely to face serious competition soon.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.9 stars on average, based on 9 rated postsVladislav Semjonov has a legal and financial background. He has been involved in crypto space since early 2017 in both ICO advising positions in several ICO consultancy firms, and as an ICO analyst for VC. He began contributing for Hacked.com in April 2017.




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Op-Ed

Our Review of the MJAC CryptoCompare Summit in London, UK (13 June 2018)

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Disclaimer: This was my first attendance at such an event since beginning my career as a professional and independent cryptocurrency and /or blockchain journalist.

 I am not affiliated with the event organisers nor do I know them personally, and the same goes for all organisations in attendance as of the time of writing.

[official photographs here]

Earlier this month, I attended the ‘MJAC CryptoCompare Blockchain Summit’ and concluded that the best approach would be to cover the event in a candid matter.

There weren’t any scandals or controversies to speak of. What we mean by this is that this piece intends to cover the greatest pros and cons of the event, in hindsight (which was organised and executed by CryptoCompare in collaboration with MJAC).

First off, MJAC (AKA InvestorsHub) is an organisation that you aren’t likely to have heard of. They are the events and conferences arm of ADVFN, a prominent financial services organisation. Many of the same people responsible for the successful ‘Marijuana Annual Conference’ were also behind the conference in question, hence the acronym ‘MJAC’.

Many of you should be fully aware of CryptoCompare. They are arguably one of the most utilised data resources for up-to-date and historical data on market trends, respective per-coin values, and overall trade volume.

Location and Venue

The days proceedings took place at a venue called ‘Old Billingsgate’.

It’s a listed building which features a combination of historical architecture with modern internal fittings and is located close to Monument tube station. Its name derives from the nearby historic Old Billingsgate Market area.

The choice of venue couldn’t have been much better thanks in part to the location’s iconic and unobstructed view across the Thames River: including the Tower of London in clear sight, plus The Shard being mostly-visible nearby.

Old Billingsgate benefits from being highly accessible to attendees and participants due to its central location, however this is where the positive words I have for the venue start to run dry.

The aesthetic was great, and photographs show a busy yet not overpopulated show floor. The show started with a similar number as represented for most of the day, but later in the day the floor became packed and somewhat claustrophobic.

This atmosphere wasn’t helped by the fact that the space here felt both condensed and underutilised at the same time, with all the stalls leaving small hallways to brush past other visitors.

Conversely, over half of the two stories of open areas in the venue were dedicated to two theatre spaces, one large and one small. These rooms were well arranged and hosted all the one-day summit’s speakers and panelists.

Speeches and Panels

Speakers and individual panel attendees of course were responsible for many of the day’s highlights, as well as the presence of a combination of established and up-and-coming companies/ICOs.

Vitaly Kedyk (Executive Director of CEX.IO) and Claire Wells (Director of Legal & Business Affairs for EMEA at Circle) were two of the events strongest performers, whilst other notable speakers & panellists included representatives from CoinFloor, Ripple, BlockEx, and Coinbase – to name a few.

Unfortunately, not all panellists seemed to be ideal matches for such discussions. A couple that I attended, for example, featured a combination of experts whose interactions were often close to non-existent with each other. What’s more, top participants were easily distinguished by their contribution of valuable insights and answers than their peers in some circumstances.

Organisation and execution of the event overall is something to be lauded. Every speech and panel I saw started and finished with perfect timing, suggesting a great approach to planning. There was also a great atmosphere amongst participants and all I spoke to.

Success or Failure?

The qualification and quantification of any event’s success or failure should arguably be defined in several ways. Cryptocurrency is still growing as an industry (despite what the market tracking values may indicate), which gives us less of a general standard against which to measure them.

One way we can still utilise though, is to measure its performance in hindsight and considering the organisers’ own stated ambitions / agenda.

“The pace of development in the crypto space has rapidly picked up in the past year and it Is now more important than ever to gather the top thought leaders to showcase progress and discuss challenges. MJAC will give customers, investors, and regulators a chance to glimpse into the future direction of this exciting new industry.”Charles Hayter, CryptoCompare.

This quote was taken from the first page of a complimentary guide that was available to all attendees.

It came along with a free book (‘CryptoAssets’ by Chris Burniske and Jack Tatar), which is honestly not bad as a beginners and intermediate level guide aimed primarily at non-technical crypto enthusiasts.

For all intents and purposes, the organisation achieved their stated goal to a degree, however the sequel had better be much more impressive to excuse the lack of experience on British soil (one of the largest crypto economies in Europe, and arguably one of if not the financial capital).

A Relative Conclusion

The second and final way (that we will discuss here) you can measure such an event is through comparison to other events, which are popping up around the world as well as within London alone despite market indicators.

One of these is the similarly titled ‘Blockchain Summit London 2018’. It is set to be a much larger event: boasting approximately 2,500 attendees and over 150 speakers.

It also costs approximately £400 for the two-day event and is set in the well-known Olympia venue in Kensington, West London. Taking place just a couple of weeks after the MJAC CryptoCompare conference.

MJAC CryptoCompare Blockchain Summit was the first event held by these event organisers about cryptocurrency in London. On that end: it is not entirely fair to consider it an equal comparison with this rival, especially when tickets were the relatively low price of £100.

Despite this I can’t help but admit that I was perhaps expecting more from this ‘summit’, if not a little too much.

7/10

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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