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Spectre And Meltdown Madness: What It Means For Ethereum

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To anyone who talks in terms of a cryptocurrency bubble, consider the following fun facts. In the short period of a few days following the bombshell announcement of Meltdown and Spectre, crypto prices responded in the following manner:

Bitcoin +18%

ETH +41%

Litecoin +30%

In my view, this is clear evidence of a market that is responding rationally to information coming from responsible sources. To appreciate what all the noise is about you must appreciate what Meltdown and Spectre are and why they present a danger to the big companies providing cloud storage for the corporate world.

Once this is clear, then you will better appreciate why Ether’s 41%+ short-term price spike left the others in the dust. But first lets dig into the Meltdown and Spectre situation.

The Secret Got Out

 On January 3 the secret about a new class of security vulnerabilities leaked out to the public. Not only was this seriously bad news but the leak also gave hackers advanced notice before anyone could begin to fix the twin problems.

The degree of seriousness is in the fact that almost all major microprocessor chips are vulnerable. This opens the door to hackers stealing information from personal as well as cloud services.

Researchers claim that Meltdown can be fixed with a patch. Shortly thereafter about every major player announced their patch. But there are two issues here. Will the patches fully solve they problem?

Casting A Cloud Over The Cloud

When a corporation becomes a cloud customer, even the largest share machines with other customers. This is the basic flaw in the centralized structure of cloud storage. Contrast this with the decentralized structure of blockchain technology and you begin to appreciate the force behind the sudden price spike in cryptocurrencies that we highlighted above.

Even though security tools and protocols are designed to separate customers date, the recently discovered Meltdown and Spectre flaws still leave serious vulnerabilities.

Meltdown, hackers could rent space on a cloud service, just like any other business customer. Once they were on the service, the flaw would allow them to grab information like passwords from other customers.

Secondly, reports on cloud services like Amazon, Google and Microsoft claim that it creates as much as 30% slower computation speeds. That clearly won’t make for happy customers.

Jerky NetFlix

Virtually everyone reviewing the situation believes individual computer users are the least vulnerable. That may be true. Hackers are in the hunt for the biggest prize and that would be the big three cloud companies. But how do you think families are going to react if their Netflix stalls and buffers every few minutes?

In the final analysis, the Meltdown flaw affects virtually every computer chip fabricated by Intel in use today. You are talking about 90% of the Internet and business world. But Meltdown is just one flaw.

Spectre is the other flaw and this one is the more insidious of the two. There is no known fix. Intel, AMD and others have claimed how complex a project it would be for hackers to breech the Spectre vulnerability. That is pretty hollow comfort. After all, hasn’t the FBI security been breeched. Those guys were supposed to be airtight.

Boom Days For Blockchain

In so many ways, last year marked a tipping point in the spread and acceptance of blockchain technology. The uses for Bitcoin are probably best gauged by its record $20,000 price in December. For Ethereum, it may have been marked by the formation of the Enterprise Ethereum Alliance (EEA) in February and rise to over 300 members at year-end.

No sooner has 2018 begun that the Meltdown and Spectre flaws created unexpected excitement for investors in cryptocurrencies. If I were a software salesman out of work, I would be sending my resume to every crypto company offering to peddle their blockchain. It could be the easiest job since selling web design services in 1995.

The Ethereum platform with its smart contracts is not the only crypto capable of addressing this newly uncovered opportunity created by Meltdown and Spectre. You can safely bet this will attract many players and for good reason, today’s blockchain technology is a long way from fast enough for mass adoption. Blockchain security may be a step or two better in it present form than cloud storage, but it has its security issues as well.

Building the Ethereum Moat

 EEA founder Jeremy Millar is clearly a brand ambassador for Ethereum. He believes that CEOs hear the chatter about blockchain and are pre sold not having a clear picture what can be accomplished or the money saved using this technology. The important thing is for IT departments to have a respected brand to attach to their recommendations.

The EEA seeks to connect and inform and through this pioneering process spread the gospel of Ethereum. So far this is beginning to build a brand franchise for Ethereum.

The EEA is the largest blockchain body and is committed to using open-source Ethereum technology for enterprise blockchain solutions. EEA expects to see great advances in these areas in 2018 with Ethereum technologies.

It also helps when Wall Street banks uncover the potential for billions in savings on the trading desks through the applications of the Ethereum platform.

So, if you though the last year held plenty of excitement, the Meltdown and Spectre flaws promise to make this year every bit as much fun.

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 114 rated postsJames Waggoner is a veteran Wall Street analyst and hedge fund manager who has spent the past few years researching the fintech possibilities of cryptocurrencies. He has a special passion for writing about the future of crypto.




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7 Comments

7 Comments

  1. Mister.Ticot

    January 8, 2018 at 11:06 pm

    It’s nice to have this kind of clever analysis here; still I don’t know what are spectre and meltdown 😀

    • incog13

      January 9, 2018 at 1:22 am

      How is Ethereum immune to these vulnerabilities that affect so many processors? Technical details would be nice.

  2. Thitzun

    January 9, 2018 at 1:48 am

    What are Spectre and Meltdown ?

  3. sparrowfahrenheit

    January 9, 2018 at 3:16 am

    James Bond fought Spectre. Don’t you guys know anything? Geeze…

  4. sparrowfahrenheit

    January 9, 2018 at 3:18 am

    Actually, its the “MINIX” system built into the subsystem of the hardware that concerns me. It has access to all of the programs on your machine -and can be accessed by the likes of entities like the NSA. If only we had open source hardware as well as software. Blockchain is great for revitalizing our rights to privacy.

  5. Cg4447

    January 9, 2018 at 6:51 pm

    I think its time the world starts noticing the potential of the SAFE network (Maidsafe), it has greater potential to solve these problems than Spectre or Meltdown.

  6. propMaster

    January 9, 2018 at 6:52 pm

    Typo in the article: ‘date’ should be ‘data’ in “Even though security tools and protocols are designed to separate customers date, the recently discovered Meltdown and Spectre flaws still leave serious vulnerabilities.”

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Altcoins

Ravencoin (RVN) Arrives With 118% Weekly Growth Ahead of Mainnet Launch

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Ravencoin (RVN) made its entry into the market cap top one-hundred on Sunday, propelled by a Binance listing, and 118% sustained growth over the course of the week.

Trade volumes for the asset-creation coin hit all-time highs on Thursday, rising an incredible 23,000% from $212,000 to $49 million within the space of ten days.

Ravencoin has been around since 2017, and the upcoming mainnet launch on October 31st marks the one year anniversary of the coin’s creation. It also marks the ten year anniversary of the release of the Bitcoin whitepaper by Satoshi Nakamoto.

RVN Rising

Ravencoin was going relatively unnoticed until it gained a Binance listing on October 11th. As you can see from the chart below, the Binance listing completely changed the coin’s fortunes.

Indeed, if we look at the source of today’s $49 million worth of trades we see that Binance has housed just under 85% of the total.

In the past week the coin rose 118% in value, climbing from $0.017300 up to Sunday’s peak of $0.037732. Since the date of the Binance listing the coin is up 172% in value, and finds itself among the market cap top-eighty.

What Is Ravencoin?

The Ravencoin protocol is open-source and available to the public, and focuses on the creation of digital assets on its Proof-of-Work (PoW) blockchain.

The blockchain itself is secured by sixteen different hashing algorithms, all of which are rotated on a non-patterned basis. The algorithm changes depending on the final digits in the preceding block hash, making it impossible to predict by ASIC mining machines.

As stated in the initial release notes last year:

“The core developers are currently focused on building the asset layer which will allow Ravencoin to facilitate the transfer of assets.  There is a hard-fork planned for the network to implement this additional asset layer in around October/November 2018 time frame.”

The devs appear to have held true to that time frame, and the mainnet upgrade is expected to go ahead as planned on October 31st.

The release notes state that no premine was used, nor are there any developer rewards. The blockchain is intended to be a Bitcoin for digital asset creation, and according to the official documentation:

“Assets can come in a variety of types, such as financial instruments such as security tokens/stocks/bonds/deeds/etc as well as gaming items (ex. a sword)/conventional asset management/managing  distributions for co-ops/digital art. There are a lot of real-world applications that this blockchain is intended to disrupt and improve.”

More can be read about the coin’s unique hashing algorithm, known as X16R, in the dedicated whitepaper provided in the Ravencoin release.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

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 81 rated postsGreg Thomson is a full-time crypto writer and digital nomad. He eats ICOs for breakfast and bleeds altcoins. Wherever he lays his public key is his home.




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Altcoins

Minor Bounce Lifts Crypto Market Cap Above $211 Billion; Tether Circulation Plummets

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Crypto prices traded modestly higher on Sunday, as bitcoin regained its footing above $6,500 and major altcoins avoided further losses.

Market Update

The cryptocurrency market capitalization on Sunday peaked at $212 billion, the highest in five days. At the time of writing, the market was valued at $211.5 billion.

Most assets ranked in the top-20 had reported minor gains over the last 24 hours, a period marked by lower trade volumes. The bitcoin price has returned above $6,500 on trade volumes of just $3.2 billion. The leading digital currency continues to trade at a premium on Bitfinex.

Meanwhile, Ethereum rose half a percent to $206. XRP also climbed 0.5% to $0.459. Bitcoin cash was last seen trading above $449 for a gain of 1.6%.

Stellar XLM was the only top-ten coin not to report gains at the time of writing. However, the no. 6 coin by market cap has returned more than 13% over the past week, far outpacing the broader market.

Trade volumes have declined steadily over the past week, as markets re-balanced following a sudden spike on Oct. 15. Digital exchange volumes have fallen to $9.7 billion on Sunday, according to CoinMarketCap.

Tether Market Cap Plunges

Since the start of October, Tether has pulled more than $600 million worth of USDT out of circulation, leading to a sharp drop in the stablecoin’s market cap. Cryptocurrency exchange Bitfinex, which is run by the same executive in charge of Tether Limited, appears to be leading in the offload of USDT tokens. As CCN recently reported, Bitfinex has initiated six transfers of USDT funds to the Tether Treasury this month. The latest transfer was initiated on Wednesday when Bitfinex sent 50 million USDT to the Treasury.

Most of the outflows from Bitfinex occurred long before USDT lost its peg to the dollar in a single-day crash on Oct. 15. USDT briefly fell below $0.90 that day before quickly recovering around $0.94. Currently, one USDT is equivalent to $0.984 U.S., according to CoinMarketCap. Some exchanges are quoting USDT as low as $0.96 on Sunday.

The sudden decline in Tether’s circulation comes at a time when the company is facing heightened scrutiny over its dollar-backed reserves. An influx of alternative stablecoins offering greater transparency and regulatory oversight may also be undercutting demand for USDT.

Case in point: the Gemini Exchange’s GUSD stablecoin reached a high of $1.19 on Tuesday before settling around parity against the dollar. Unlike USDT, the Gemini Dollar has obtained regulatory approval from the New York Department of Financial Services. On the opposite side of the spectrum, Tether has been subpoenaed by federal regulators over its connection with Bitfinex and failure to prove its dollar reserves.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

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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4.6 stars on average, based on 648 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Altcoins

TRON (TRX) Transactions Outnumber Ethereum’s Thanks to TRONbet Gambling App

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For the past year much of Justin Sun’s time was spent trash-talking Ethereum on Twitter, while talking up the future potential of his own TRON blockchain.

Such behaviour once made it easy to dismiss Sun as a mere troll, however it now looks like TRX might actually be gearing up to do battle with ETH based on its rapidly growing number of users and transactions.

TRX Transactions Soar

The amount of transactions on the TRON blockchain outnumbered that of Ethereum for the first time ever this week. In the three day period between Oct 18th and Oct 20th, TRX transactions outpaced their ETH counterparts by several tens of thousands.

The sudden jump in transactions comes in large part from the recently launched TRON-based gambling app, TRONbet. According to Sunday morning’s tweet from the TRONbet team:

“Amazing start for #TRON with http://tronbet.io doing almost 180k Txs a day! Almost 30% of all Txs! 165,000,000 $trx won by users. @justinsuntron @Tronfoundation has shown us the endless possibilities!”

The 180,000 transactions mentioned helped to boost total TRX transactions from 222,000 on October 17th, up to Friday’s peak of 630,000. Going back to October 10th, the total number of TRX transactions was in the 80,000 range, meaning the last ten days have seen a 687% increase to transaction volume.

Justin Sun marked the occasion with a celebratory tweet, stating:

“Ethereum has 82,418 Txs pending today. It is the second day that #TRON has surpassed #ETH in daily Txs. 10/18 #TRX 599,677 vs. ETH 565,971; 10/19 $TRX 630,018 vs. ETH 601,119. All ETH developers need to migrate to TRON immediately with 0 cost!”

Smart Contracts

One can only speculate on where the rest of the TRON transactions came from, but according to TRXPLORER.io, the vast majority of them were triggered by smart contracts:

“Yesterday we had the highest spike of transactions on #TRON network with almost 600k transactions in a day! 77% of those transactions were Smart Contracts that were triggered!”

To provide some perspective, it took the TRON blockchain four months to achieve the number of transactions that Ethereum achieved in nearly three and a half years.

A skeptic may demand to know exactly where these transactions are coming from, after all, even Ethereum has seen huge increases to transaction volumes thanks purely to pointless smart contracts which move the same funds between multiple addresses.

As covered here previously, October has been a productive month for TRON. The number of accounts created on the blockchain recently outpaced EOS, gaining 100,000 more new accounts than EOS in the previous four month period.

Meanwhile, a quick glance at Google Trend analysis for ‘TRON’ searches compared to ‘Ethereum’ reveals that TRON is being searched for more than its older counterpart.

The chart shows the same pattern for ‘TRX’ searches compared to ‘ETH’.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

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 81 rated postsGreg Thomson is a full-time crypto writer and digital nomad. He eats ICOs for breakfast and bleeds altcoins. Wherever he lays his public key is his home.




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