Linux.MulDrop.14 is a Linux worm that seeks out networked Raspberry Pi systems with default root passwords; after taking them over and ZMap and sshpass, it begins mining an unspecified cryptocurrency, creating riches for the malware's author and handing you the power-bill.

Experts say the initial infection takes place when Raspberry Pi operators leave their devices' SSH ports open to external connections.

Once a Raspberry Pi device is infected, the malware changes the password for the "pi" account to:

$6$U1Nu9qCp$FhPuo8s5PsQlH6lwUdTwFcAUPNzmr0pWCdNJj.p6l4Mzi8S867YLmc7BspmEH95POvxPQ3PzP029yT1L3yi6K1

After this, Linux.MulDrop.14 shuts down several processes and installs libraries required for its operation, including ZMap and sshpass.

The malware then launches its cryptocurrency mining process and uses ZMap to continuously scan the Internet for other devices with an open SSH port.

Once it finds one, the malware uses sshpass to attempt to log in using the username "pi" and the password "raspberry." Only this user/password combo is used, meaning the malware only targets Raspberry Pi single-board computers.

Linux Malware Mines for Cryptocurrency Using Raspberry Pi Devices [Catalin Cimpanu/Bleeping Computer]

(Image: Evan-Amos, PD)

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Linux worm turns Raspberry Pis into cryptocurrency mining bots - Boing Boing

In the world of Bitcoin and cryptocurrency, we have a phenomenon known as shilling. This particular endeavor revolves around tricking as many people as possible into thinking a particular coin or token will be valuable in the future. There are many different ways to go about things, although some methods are far more common compared to others. Below are some of the more common methods people use to shill particular cryptocurrencies.

One of the places where people often used to shill cryptocurrencies was the Trollbox on the Poloniex exchange. Albeit such hangout places are designed to have a nice chat with other users, they often become a tool to promote new cryptocurrencies regardless of whether they have any real value whatsoever. Trollboxes and chatboxes on most cryptocurrency exchanges simply need to be avoided when it comes to any cryptocurrency advice. Shilling is the top priority there, rather than having mature conversations. Thankfully, Poloniex shut down its Trollbox not too long ago.

The BitcoinTalk forums are the go-to place for any discussion related to cryptocurrency. What once started out as a bitcoin-only bastion slowly evolved into a place where multiple cryptocurrencies can be discussed at any given time. Do keep in mind a lot of people hanging out in the altcoin section are merely shilling particular coins, though. There are also quite a few paid advertising campaigns to spread the world about coin X or token Y. Always be careful when looking for specific information on BitcoinTalk.

As we have come to expect these days, a lot of people rely on Reddit for the latest information regarding cryptocurrency. Virtually every token, asset, or coin has its own subreddit these days, which is good. However, a lot of those Reddit posts in those subsections are merely speculation, fake news, and shilling attempts as well. Any information found on Reddit regarding whichever cryptocurrency needs to be taken with a massive grain of salt, to say the least. There is also the risk of seeing a paid Reddit advertisement at the top of a particular subreddit, which is designed to shill a particular coin.

One of the most common ways to shill currencies, tokens, and assets is by using social media. Things are getting a bit out of hand on both Twitter and Facebook these days. A lot of people will tweet something in quick succession to gain some form of social traction. That is not always a successful way of doing things, but it certainly ensures things get noticed on the platform. This is especially true with most ICO tokens and altcoins which bring nothing of value to the table.

Things are virtually the same on Facebook, though. Every group related to Bitcoin or cryptocurrency will ultimately attract shills trying to promote a specific project or service. In most cases, these coins are useless or the service turns into a scam. It is impossible to trust the information one receives from social media, as shilling becomes a second nature pretty quickly.

The most intriguing way to ensure some projects gain traction regardless of their legitimacy is by paying for content on blogs and news sites. We often see scam projects and pointless ICOs issue press releases to sites, who publish them in exchange for a small fee. In some cases, such paid content will show up on PR Newswire, or even get picked up by mainstream media outlets. People need to be especially wary of this type of content, as a lot of shills will gladly pay a small fee to ensure their flavor of the month project gets some attention.

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Top 5 Ways to Shill a Cryptocurrency - The Merkle

In the world of Bitcoin and cryptocurrency, there are multiple pump-and-dump schemes to be found every week. Mainly smaller coins are often pumped to inflate the price, in the hopes of getting other people to buy in. Unfortunately, there is often a lot of hype associated with any major pump, regardless of whether it is relevant news or not. We have seen quite a few pumps in recent weeks, and the following ones stood out.

One of the many smaller altcoins to integrate Segregated WItness goes by the name of Vertcoin. On paper, there is no real reason to sue this cryptocurrency over others, by any means. However, some people are trying to drive the price up, and one VTC is worth nearly US$1 at the time of writing. That is quite a jump in value, considering VTC was valued at roughly US$0.25 a few weeks ago. Someone is definitely pumping the value.

It has been extremely quiet where CloakCoin was considered for quite some time. A few days ago, the value per coin suddenly started going up, despite there being very little trading volume. One CLOAK is valued at US$3.83 now. There is absolutely no reason to use CloakCoin, other than from a privacy perspective. Then again, there are multiple major cryptocurrencies offering similar and sometimes better- technology to achieve the same goal. It looks like CloakCoin is a clear pump-and-dump, although it is too early to tell what might happen.

It is not hard to see why people think of BitcoinDark as a pump-and-dump scheme. The currency is trying to ride Bitcoins coattails on the way to success. It is one of the many futile attempts to bring more privacy and anonymity to Bitcoin. In fact, it uses its own blockchain, removing any potential ties with Bitcoin in the process. Every BTCD is worth US$65.65 right now, which is massively overvalued, to say the least.

When Primecoin initially launched, a lot of people got excited because it provides a bit of a novel concept. To this very day, there is no reason to actually use Primecoin, other than from a speculative point of view, though. Primecoin has seen its market cap grow to over US$10.7m, despite having no real use cases. Once again, a clear example of someone trying to pump the price and looking to dump on investors getting caught up in the frenzy.

Although a lot of people would rather not see Digibyte on the list, it is impossible to deny the currency is getting pumped hard right now. Many people still believe there is a Minecraft deal, which is not the case. Nor did Digibyte win the Citibank tech challenge, which is somewhat of a shame. In fact, there is no real reason for one Digibyte to be worth what it is today, and the trend is already showing signs of reversing. The Digibyte team is working on some amazing technology, yet they do not hinge on the success of DGB as a currency.

It is a bit difficult to quantify the use cases for Stellar, albeit they are quite similar to Ripple and their XRP asset. It appears Stellar is trying to compete with Ripple in developing technology and a currency for the financial sector. There are some key differences between both projects, as we highlighted before. Over the past few weeks, the value of Stellar Lumens has been pumped to US$0.05. That is rather remarkable, considering a large amount of XLM is distributed free of charge. Stellar has some partnerships with banks, but it is not even close to the same level Ripple is at right now.

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Top 6 Recent Cryptocurrency Pumps - The Merkle

Moscow-basednext generation cryptocurrency platform Byteballhas made available an online bot store and P2P insurance for all users. The new bot store provides users with various apps with integrated chatbot interface, such as cryptocurrency exchange, flight delays oracle, sports oracle, and others created by independent developers.

Unlike traditional blockchain-based cryptocurrencies, Byteball has no blocks, hence no block size issues. Byteball uses a technology known as Directed Acyclic Graph (DAG), which bypasses scalability issues that often hamper other cryptocurrencies. With DAG, every new transaction references several previous transactions, (known as parents) by including and signing their hashes. By including its parents, each new transaction also indirectly includes and confirms all the previous parent transactions, dating back to the original transactions. As more transaction information gets added after a particular transaction, the number of confirmations registered by that particular transaction will continue to grow. This system creates a snowball effect of transactions, accurately reflected by the name, Byteball.

Byteball is an initiative of a Moscow, Russia-based development team. The innovative cryptocurrency uses DAG instead of the conventional blockchain, eliminating scaling issues. Byteball is a complete cryptocurrency ecosystem launched on Christmas day, 2016.

Byteballs bot store offers bot developers a great level of exposure while giving consumers an easy-to-use platform to access cryptocurrency powered apps. The bot store is similar to a traditional app store, except that users can start using chatbot based apps free of charge. With the new bot store, developers can quickly develop and publish apps that offer various services through a chat interface, thanks to tight integration of chat feature with payments and smart contracts.

In addition, chatbots also bring smart contracts closer to end-users by automating their creation. The user only needs to accept the smart contract to use the apps service. In the interest of fluidity and mass adoption, Byteball has maintained these contracts very simple and easy to read, for the benefit of regular users.

Byteballs primary, real-world P2P application relates to prediction markets, specifically insurance. The recently launchedflight delays oracleis one such example, capable of posting live information about flight delays. The information can then be used in P2P insurance to get paid if the insured flight was delayed.

Similar to the flight delays oracle, the Byteball sports oracle posts information about results of football matches and the information can then be used in P2P sports betting smart contracts. Other markets in which these oracles can be utilized includes insurance for weather events, investment ratings, and news.

Sadly, the benefits of P2P technology have so far been underutilized. Byteball aims to change it by applying the very technology to real-world scenarios in the interest of all consumers. A clever integration of P2P technology in the field of prediction insurance markets, combined with the groundbreaking new bot store will offer the industry a glimpse of the full potential of what cryptocurrencies can achieve.

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Cryptocurrency platform Byteball adds online bot store and P2P ... - CryptoNinjas

Ethereum's Big Switch: The New Roadmap to Proof-of-Stake

May 5, 2017 at 13:00 | Alyssa Hertig

Ethereum's developers are offering more clarity on how the network is preparing for its biggest change yet.

May 5, 2017 at 10:00 | Corin Faife

A new project is seeking to combine ethereum's smart contract capabilities with the privacy afforded to the zcash blockchain.

May 2, 2017 at 22:55 | Charles Bovaird

Five things you should know about ether, a cryptocurrency that surged in value during the first quarter of 2017.

Apr 28, 2017 at 13:35 | Michael del Castillo

Differences between EEA members at a public debate reveal how the group is growing and progressing.

Apr 27, 2017 at 14:20 | Stan Higgins

The price of ether, ethereum's native token, has hit a new all-time high, exceeding $60 for the first time ever.

Apr 26, 2017 at 21:20 | Stan Higgins

A former software engineer for digital currency startup Coinbase has launched a new search engine for ethereum.

Apr 25, 2017 at 15:07 | Charles Bovaird

Ether classic's price reached an all-time high this week, amid robust transaction volume. We ask the experts why...

Apr 25, 2017 at 00:55 | Alyssa Hertig

Ethereum prediction market project Gnosis sparked broad debate today following an initial coin offering that didn't exactly go as planned.

Apr 24, 2017 at 14:00 | Michael del Castillo

The UN is preparing to kick off an epic ethereum pilot, but the future could also include actually accepting cryptocurrencies.

Apr 23, 2017 at 11:26 | Alyssa Hertig

A look at what's still to do for ethereum developers working on the Metropolis upgrade the platform's third of four planned stages.

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Cryptocurrency 2.0 and Smart Contracts News - CoinDesk

Dr. Chan currently offers the online course Mean Reversion Strategies to a select number of traders and portfolio managers. This is an online workshop conducted in real-time through Adobe Connect. This workshop focuses on the theories and practical implementation of mean reversion strategies. (Free MATLAB trial licenses and pre-recorded MATLAB programming tutorials are included.) The math requirement assumed is basic college-level statistics.

Course outline can be downloaded here.

___________

We are offering the pre-recorded online course Cryptocurrency Trading with Python. This course was conducted by Nick Kirk, an expert in algorithmic crypto trading and a quantitative developer, and was moderated by Dr. Ernest Chan.Participants will receive Python source code and data for backtesting. Gemini Exchanges Sandbox environment will be used, which offers full exchange functionality using test funds, for testing API connectivity and the execution of strategies.

Course outline can be downloaded here.

About Nick Kirk

Nick is an active algorithmic crypto trader and quantitative developer. He has more than 10 years worth of experience in developing, automating and integrating trading systems for Investment Banks and Asset Management firms. Prior to working in Finance, he worked at IBM Labs and Siemens Research. He has previously taught algorithmic crypto trading at the CQF Institute to wide acclaim.

Praise for this workshop

Excellent class. Particularly liked the technical aspects of building a trading system in python.

-Anonymous participant review

Nick is a very passionate advocate of cryptocurrencies. I was very pleased to have attended one of his cryptocurrency trading workshops in the past. His blunt enthusiasm along with his in-depth knowledge on the field result in a very positive and value added experience on cryptocurrency trading with actual hands-on implementation. In combination with Ernie Chan, the guru of algo trading, the mix is going to be explosive! Cant wait!

Konstantinos Moutsioulis Portfolio Analyst, Dutch Development Bank, The Hague Area

I have been very impressed with Ernies past workshops and have enjoyed discussing cryptocurrency trading ideas with Nick on many occasions. I look forward to their unique partnership in the upcoming Bitcoin workshop.

Stephen Hope Former Head of Fixed Income Quantitative Trading Strategies, BNP Paribas ___________

The pre-recorded online course Backtestingis nowavailable. This consists of recorded Adobe Connect sessions. Thefocus is on discovering and avoiding various pitfalls during the backtesting process that may degrade performance forecasting. Illustrative exercises are drawn from a futures strategy and a stock portfolio trading strategy using MATLAB.Free MATLAB trial licenses will be arranged for extensive in-class exercises. No prior knowledge of MATLAB is needed, but some experience with programming is necessary. The math requirement is basic college-level statistics.

Course outline can be downloadedhere.

___________

Ernie also offers in-person workshops in London, September 11-15, 2017.These workshops may qualify for CFA Institute continuing education credits.

___________

Praise for ourworkshops:

An excellent course by a great teacher. Ernie clearly explained and applied the different areas of Artificial Intelligence, provided invaluable insights as to their relative merits, and gave me the confidence to implement them in my own trading. Dr Nikhil Shenai (Ph.D., Imperial College, BA, Cambridge University), Founder of E K Technologies (Quantitative Trading & Development)

thank you again for the Momentum Strategies training course this week. It was very beneficial. I found your explanations of the concepts very clear and the examples well developed. I like the rigorous approach that you take to strategy evaluation. Andrew B.

Ernies workshop offers particularly helpful insights in implementing profitable trading strategies and thats beyond hisbooks content. And he is one of the most patient and giving instructors I ever metK.W. Fung, CQF, Founder of Quants Investment

These workshops have provided me with enough familiarity and confidence to tackle the latest research. Justthe segment on intermarket sweep orders in the MFT course was worth the price of admission to all three workshops I went to. Cedric Yau

Dr. Chan is a phenomenal instructorAnonymous student evaluation

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Cryptocurrency mining malware has come a very long way over the past few years. Whereas Bitcoin used to be the center of attention in the beginning, this type of mining malware has expanded to include Dogecoin, Monero, Ethereum, and ZCash as well. However, the latest iteration of mining malware uses Raspberry Pi devices to mine coins. Not the most efficient approach, but it is still an interesting development.

A lot of people have shown great interest in the Raspberry Pi devices. These pocket-sized computers are quite powerful and very affordable. Although they will not replace traditional desktops or laptops anytime soon, they make for appealing home theater devices, among other things. Every Raspberry Pi usually runs some form of the Linux operating system, although there is a slimmed down Windows 10 IoT version in the works as well.

Up until now, the Linux operating system has been relatively safe when it comes to malware. Criminals often only develop nefarious tools to harm Windows computers, with a few exceptions going after Apple users as well. This new variant of cryptocurrency mining malware is a Linux Trojan, which goes by the lackluster name of Linux.MuLDrop.14. It is also purposefully designed to attack Raspberry Pi devices and use the machines resources to mine cryptocurrencies.

As most people are well aware of, the Raspberry Pi is not the most powerful device by any means. It doesnt have a powerful CPU or integrated graphics chip by any means. In fact, the device is entirely unsuited to mine cryptocurrency whatsoever. However, if you control a few thousand of these devices without having to pay for their electricity, things can start to look a lot better from now on.

It appears this new cryptocurrency mining malware has been around since May of 2017. It appears the Raspberry Pi devices are infected through the SSH protocol, assuming the device owner leaves this port open to external connections. That is the case more often than not, though, as a lot of people connect to their Pi over SSH. If the mining malware is installed successfully, it also changes the password of the standard account to a long string of characters.

It is quite interesting to see developers go out of their way to only target these smaller devices, though. Cryptocurrency mining on a cluster of Raspberry Pis will still not generate much income by any means. It is unclear which cryptocurrencies are mined exactly using this malware, though. It would take millions of enslaved devices to make even a dollar per day, which makes this entire effort not exactly worthwhile by any means.

The bigger problem is how this could signal an era of Linux-oriented malware. Considering many people feel Linux is the safest operating system, it is certainly possible criminals will try to prove them wrong. In the case of this mining malware, however, it appears victims can get rid of the malware by flashing the operating system again. There is no ransom demand to regain control over the device whatsoever. Still, it is quite a troublesome development, to say the least.

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New Cryptocurrency Mining Malware Targets Raspberry Pi Devices - The Merkle

Mining references generally evoke images of picks and shovels.

For advocates of bitcoin and the other cryptocurrencies surging in value, the gold may be in the shares of the companies that produce the computer processors and chips used to create the digital currencies in the process thats become known as mining.

Digital coins can only be created by using computers to solve complex mathematical problems. The difficulty increases as more of the problems get solved, prompting the miners to require even more powerful hardware.With digital coin prices soaring, demand for the components is surging as miners are able to recoup their initial investment quicker.

A complete mining rig, which is made up of graphics cards, a processor, power supply, memory, cabling and a fan, costs between $2,400 to $3,800 on Amazon.com. The Antminer S9, which is estimated to mine 0.29 bitcoin per month, and retails for $2,795, which means you can break even in about four months with bitcoin at $2,700, without taking into account electricity costs. Miners typically buy complete rigs or build them themselves.

The following are some of the companies that make the parts.

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The Santa Clara, California-based company manufactures graphic processing units used by gamers and increasingly, by digital-currency miners. GPUs listed in Nvidias website can cost as much as $1,200. The rig-mining market can grow to about $1.3 billion, and with GPUs making up approximately 2/3 of coin mining costs, the demand for GPUs can increase to $875 million, according to a RBC Capital Markets report on June 6. If Nvidia gets half of that, it represents a 10 percent increase on its GPU sales, RBC analyst Mitch Steves said in an interview. The company currently has about 75 percent of the GPU market, according to a Jon Peddie Research report.

The complexity of mining bitcoin has increased to the point that GPUs arent powerful enough, and miners are mostly using application-specific integrated circuits, or ASICs, which Nvidia and competitor Advanced Micro Devices dont make. Tech news website Digitimes reported Nvidia and AMD are planning to release GPUs specifically designed to mine bitcoin.

Shares of Nvidia have climbed 45 percent this year, and have more then tripled in the past year.

AMD, as the company is known, also makes graphics cards used for mining ethereum and other coins. The Sunyvale, California-based companys shares have rallied the most in the Philadelphia Semiconductor Index in the past week, in part thanks to a PCWorld article that said its almost impossible to get AMDs Radeon graphics cards after a surge in demand from ethereum miners.

The company also builds the processors typically used to build mining rigs, and itsChief Technology Officer Mark Papermaster said at a Bank of America Merrill Lynch conference its product compete with bigger rival Intel Corp.

The shares are up 27 percent in the past month, and have almost tripled over 12 months.

Digital currency mining has the potential to boost demand for Intels processors, said Kevin Cassidy, an analyst at Stifel Nicolaus. While AMD CPUs are popular among miners, Intel is the traditional leader in the sector and is taking steps to counter its fledgling rival.

The companys shares have lagged rivals, with a gain of 17 percent in the past year.

Boise, Idaho-based Micron is the largest U.S. maker of memory chips, one of the components of a mining rig, so it also stands to benefit, Cassidy said.

Micron shares have surged almost 50 percent this year, and have more then doubled in the past 12 months.

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These Companies Stand to Gain the Most From the Cryptocurrency Rush - Bloomberg

Older Raspberry Pi devices, such as this Raspberry Pi 2, may be more vulnerable to the malware if they haven't been updated in a while.

Someone has developed a simple Linux trojan designed to harness the meager power of Raspberry Pi devices to mine cryptocurrency.

Raspberry Pi users may need to consider applying a recent Raspbian OS update to their devices, particularly if they are currently configured to allow external SSH connections.

According to Russian security firm Dr Web, the malware Linux.MulDrop.14 exclusively targets Raspberry Pi devices to use their processing power to mine a cryptocurrency.

Dr Web discovered the Raspberry Pi mining malware after its Linux honeypot machine became infected with it. The malware uses a simple Bash script to attempt to connect to Raspberry Pi devices configured to accept external SSH connections. It targets Raspberry Pi boards with the default login and password, which are 'pi' and 'raspberry', respectively.

It then changes 'pi' to '$6$U1Nu9qCp$FhPuo8s5PsQlH6lwUdTwFcAUPNzmr0pWCdNJj.p6l4Mzi8S867YLmc7BspmEH95POvxPQ3PzP029yT1L3yi6K1'.

From there it installs the internet-scanning tool ZMap and the sshpass utility, and searches the network for other devices with an open port 22 to infect them.

Older Raspberry Pi devices may be more vulnerable to this malware if they haven't been updated in a while. The Raspberry Pi Foundation told ZDNet sister site TechRepublic that a Raspbian OS update released late last year turned off SSH by default and forced users to change the default password.

However, it warned that there could still be millions of Raspberry Pi boards that haven't been updated. Some 12.5 million of the single-board computers have been sold over the past five years, according to the official Raspberry Pi Magazine.

The malware doesn't try to mine for Bitcoin, whose 'difficulty level' is too high to mine cost-effectively, even for a massive network of PCs let alone Raspberry Pi devices.

However, there are numerous other cryptocurrencies that can be mined with less computational power. In 2014, malware writers experimented with Android malware to mine Dogecoins and Litecoins. Dr Web's virus analysts said the Raspberry Pi malware mines Monero, a lesser-known, but increasingly popular cryptocurrency for dark-web drug markets.

Researchers in May discovered that a network of several hundred thousand PCs infected with the Adylkuzz mining malware, which used the same Windows exploit behind the WannaCry ransomware epidemic, had been toiling away on Monero blocks. At the time, Adylkuzz had generated about $43,000 over several months of mining activity.

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Linux malware enslaves Raspberry Pi to mine cryptocurrency | ZDNet - ZDNet

It is always nice to see projects attempting to better the world they live in. This is especially nice because of the low adoption rate of cryptocurrencies and Blockchain technologies on a global scale. A recent CryptoCoinNews interview went over the lack of Blockchain adoption in Africa, while pointing out the massive opportunities that reside on the continent because of that fact. One new project, Bolenum, is looking to start off there.

Though Bolenum has sights on an intercontinental project, the majority of their initial efforts appear to be in Africa. Their Whitepaper outlines the two main issues they feel have caused cryptocurrencies to see lower scale adoption than other parts of the world.

The first obstacle is one known all too well by all cryptocurrencies: lack of public awareness. Many just do not know about cryptocurrency, the Blockchain, or what it can provide. This could be because of a lack of cryptocurrency and blockchain evangelists, but also can be blamed on the lack of readily translated literature into local dialects.

The second problem is one that many in the western world have not really had to deal with: convertibility of funds. While every exchange takes Euros, United States Dollars, and Chinese Yuan, it is way less likely that these exchanges will take the Egyptian Pound, the Nigerian Naira, or the Moroccan Dirham. Without access to fiat exchanges to convert to more readily accepted currencies for crypto, individuals may be out of luck.

They hope to provide solution to these issues at the first ethereum based token and exchange platform that aims to engender more participation in the cryptocurrency on the African continent.

The projects token, BLN, aims to serve as a secure payment method, and also be able to protect wealth. These are Ether based tokens so they benefit from the speed and security of the Ethereum Blockchain.

The main perk that may help the project accomplish its goal is the fact that they will also be opening an exchange that will allow for BLN tokens to be traded for local currencies. This means that someone will be able to not only withdraw the value of their tokens into local currencies, but could give better access to the cryptosphere as a whole. If someone buys BLN with a local currency, they should in theory be able to trade those BLNs on a different exchange for any other digital asset they were interested in. It not only is an asset by itself, but a gateway asset to others previously denied by fiat binding.

They will be holding an ICO for this project starting July 15, and it will span for 30 days. 10,000,000 BLN tokens will be made, with 50% of those being open to the public in an ICO with the other 50% behind held by the Bolenum team as capital to support their future exchange.

Disclaimer: This is a paid press release, the product / service mentioned is not endorsed by The Merkle, always do your own independent research. This is not investment or trading advice.

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Bolenum's Project to Widen Cryptocurrency Adoption - The Merkle

News wallets and exchanges

eToro, a social investment and trading network, has announced the launch of its Cryptocurrency CopyFund. This comes shortly after the total market cap of cryptocurrencies surpassed $100 billion.

On June 6, eToro announced the launch of its Cryptocurrency CopyFund, which will allow customers to invest in Ether and bitcoin. Over the last year, the number of eToro users trading cryptocurrencies has grown by a factor of four. Co-founder and CEO of eToro, Yoni Assia, said:

We have been seeing an increasing number of our clients looking for a simpler way to access investments in cryptocurrencies with a view to building a portfolio in the future. They were asking how to allocate their investments between the two largest cryptocurrencies that are traded on eToro, so we have launched an automatically rebalanced investment strategy to simplify their investments into this new exciting asset class.

eToro customers have previously accessed the cryptocurrency markets through CFDs (contracts for difference).

More and more traders and investors are learning about the potential of this market and getting involved. Now they will be able to access a long-term investment strategy that is constantly reviewed and rebalanced, Assia added.

In the Cryptocurrency CopyFund, holdings will be proportional to the market caps of individual cryptocurrencies. Once a month, the fund will automatically be analyzed and rebalanced. Structured as medium-to-long-term investments, CopyFunds require a minimum pay-in of $5,000. While there are no management fees associated with CopyFund investment, eToro does charge transaction fees.

eToro will expand its offerings of cryptocurrencies in the near future to encompass Ripple and Dash among others.

Based in Tel Aviv, Israel, eToro has millions of users in more than 170 countries. In December 2014, eToro raised $27 million from Chinas Ping An Insurance Company and Russias state-owned Sberbank. At the St. Petersburg International Economic Forum, eToro recently presented a pilot blockchain wallet in partnership with coloredcoins.org.

Matthew is a writer living in Los Angeles. He studied international economics at Georgetown University. Matthew is a full time staff writer for ETHNews and holds value in Ether.

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Cryptocurrency CopyFund Launched By eToro - ETHNews

The total market cap for all cryptocurrencies just surpassed $100 billion. The vast majority of these gains have come in just the last few months on April 1st the total market cap was just over $25 billion representing a 300 percent increase in value in just over 60 days.

While some of these gains are from bitcoin itself (BTC is up ~160 percent in the same two-month time frame), other digital currencies like Ethereum are also responsible for the increase, which on its own has increased ~439 percent over the last two months.

Theres perhaps no better way to show this diversity in gains than by looking at a chart of bitcoins dominance i.e. what percent of the entire cryptocurrency market cap is represented by bitcoin. For years this had always hovered around 80 percent, but in the last few months has fallen to below 50 percent with currencies like Ethereum and Ripple taking its place.

Source: coinmarketcap.com

Bubble talk?

Its hard to be an experienced investor, or even an at-home part-time trader, and not think of a massive bubble when you see that some asset has increased more than 400 percent in just a few months. Its just how history works when an asset rises that fast its a near certainty that it will come back down. Markets are irrational, after all.

So dont be surprised if theres at least some type of correction. There already was, a few weeks ago bitcoin pulled back from a high of $2,700 to around $2,000, but, as of today, has slowly climbed back up to a new all-time high of ~$2,850.

That being said, we may look back in 12 months and realize that this two-month period of insane growth was less of a bubble and more of a rebirth of cryptocurrencies as a whole.

The fact that these gains have come from currencies other than bitcoin are a good sign that this is less of a bubble and more of a resurgence of interest in crypto. It makes sense that Ethereum is on a tear the cryptocurrency has technological improvements over bitcoin, including the ability to code smart contracts directly into the blockchain, which in turn allow for things like the ability to build totally new tokens and even host ICOs (initial coin offerings).

And similarly, Ripple, a cryptocurrency based on inter-bank settlements, has signed up more than 100 banks worldwide. Even if this takes a while to implement (which anyone who works in the old-school banking industry will confirm), its still tangible news and a reason for people to get excited about the currency.

These recent developments certainly dont justify increases of 400 percent in 60 days. Both Ethereum and Ripple have been around for a lot longer than a few months. Soif these were publicly traded companies, there would be (almost) no reason for drastic rise in value. But cryptocurrencies are new most of the world has no idea what bitcoin is, let alone Ethereum and Ripple and other currencies.

The public has never been able to put their money directly into a technology that has so much potential but is still developing.

For example, a technology enthusiast in the 1990s may have foreseen the rise of the internet, but had no way to directly take a stake in the technology.The idea of applying cryptography to the storage and transmission of data is still very new. And the fact that anyone can directly buy the currency that powers these cryptographically securedblockchains is much like the public actually getting a chance to invest in the internet during its infancy.

There is one rational explanation that, if true, would totally justify this rapid increase in price across some of the major cryptocurrencies. And that is, maybe these currencies are actually worththese high prices, and maybe even worth many times more than that at which they are currently trading.

But the problem is we have no way to figure out their value. Cryptocurrencies arent public companies with earnings and expenses and EPS. For example, we can look at Apples financials and determine its book value what the companys assets would be worth if hypothetically liquidated today. Of course, stocks trade at a premium to this, because people are enthusiastic that Apple will continue to perform well and this book value will continue to rise.

But we cant do this with cryptocurrencies. We could guess and compare it to things like the total money or gold supply in the U.S. For example, if youre someone who thinks of cryptocurrencies as a store of value, the total estimated value of all gold in the world is more than $8 trillion dollars meaning if bitcoin would ever replace or supplant gold, its current value is pennies on the dollar.

If youre someone who thinks of cryptocurrencies as a genuine currency, you could compare the market cap to M2, which is the total money supply in the U.S. cash and checking accounts, as well as near-money accounts like savings, mutual funds and money-market securities. The total value of M2 is about $13.5 trillion, also meaning cryptocurrencies are just a small fraction of that.

Ive long cautioned readers (and friends) from buying cryptocurrencies because they have seen it rise and just want to make a quick buck. The past two months have led to a tremendous surge in public interest, with mainstream news like CNBC and CNN explaining how to invest in bitcoin and other cryptocurrencies.

Just make sure youre doing it for the right reasons. Buy cryptocurrency to learn about it and transact with it. Or buy it because you are betting that this new technology will change the world by:

These are just a few options, and if youre in tune with the cryptocurrency world, youll know the opportunities are endless. So if youre going to buy cryptocurrency, do it because you see the long-term vision (and sure, ostensibly the financial gains that may come from them), not because you think it will blindly appreciate and give you a good return on your investment.

The author holds bitcoin and Ethereum and other smaller cryptocurrencies.

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What the hell is happening to cryptocurrency valuations? - TechCrunch

The consequences of allowing a cryptocurrency takeover, or trying to head one off FT Alphaville (registration) In this guest post, economics professor and former Bank of England economist Tony Yates talks about the potential for cryptocurrencies to compete with government-backed money, and what central banks can do about it. The total value of all ...

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The consequences of allowing a cryptocurrency takeover, or trying to head one off - FT Alphaville (registration)

The blockchain and crypto industry is currently replete with innovations looking to advance the technology and bring about the best results. But could there be a missing link, which when identified can lead to better investments and proper mitigation of risks?

A section of the industry insiders believe that Derivatives could be that missing link, and introducing derivatives to the blockchain could possibly enable investors to better mitigate risks involved in trading cryptocurrencies and allow them to hedge their bets. The success of derivatives has already been proven in the world of securities trading, which can be replicated in the crypto world as well.

The benefits of derivatives will be wide ranging as they will include non-stop trading, instantaneous transactions for fraction of the current fee, nearly no need for third parties except for traditional assets, no downtime, no DDOS type attacks, anonymity and the possibility to execute trades without logging in.

The process of bringing the power of derivatives to the blockchain community is being spearheaded by DCORP. DCORPP has created a platform that will allow derivatives trading in the form of smart contracts on the Ethereum blockchain where the exchange exists. Users will be provided with a friendly interface and since the exchange is decentralized and operates autonomously there is no need for intermediaries like market makers, bankers or third parties.

The exchange will generate value for the investors, the proceeds of which can be used by DCORP to carry out its venture capitalist activities. DCORP being autonomous and democratic, will, in turn, lead to the democratization of venture capitalism.

Derivatives trading has the potential to unleash revolutionary change in the way cryptocurrencies are traded today, as more investors are bound to be attracted by the opportunity to use hedging mechanisms, which will only enhance the value of blockchain.

The ability to enter derivatives contracts anonymously will also provide additional value to investors and they will also be able to trade existing derivatives contracts by sending Ether to them.

Investors stand to benefit by harnessing the power of derivatives. Traditional derivatives like futures and options will be available, and the investors will also benefit from Futures with Ascending Stakes. The whitepaper elaborates upon the type of derivatives that will be made available on the exchange.

There is also a plan to use the blockchain and smart contract technology to enable talented entrepreneurs and ventures to gain access to funding. DCORP will make it possible for anyone to join the organization either as a shareholder or as a talented contributor. Investors can also participate in the ongoing DCORP crowdsale.

The DCORP exchange promises complete transparency in its operations as the Board of Directors will comprise of 7 elected individuals. Frank Bonnet, the founder of DCORP who will also be a member of the Board of Directors, explains that the voting behavior of the members will be recorded on the blockchain, public and immutable. The members can also be replaced by submitting a proposal and getting the token holders to vote in favor of it.

DCORP intends to carry out a streamlined democratization of venture capitalism, which is not only an interesting idea but also novel, as it enables even non-technical persons to benefit from it.

The introduction of derivatives to crypto can only generate further investor interest as it brings in an element of risk management to venture capitalism.

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Derivatives The Missing Link in The Cryptocurrency World? - newsBTC

Imagine an online gambling ecosystem that is decentralized, meaning that it cuts out the typical middleman between a game-maker or betting operator and the player or bettor. Thats the pitch of Russian company DAO.Casino, a decentralized platform for online gambling operators that runs on the Ethereum blockchain.

In its white paper on the developer site Github, DAO.Casino says it can solve common headaches of online gambling that afflict both game developers and game players, such as: fraud risk; hidden fees; high cost of entry for game developers; operational overhead; player access to funds; player withdrawal delays; and general lack of trust.

If that sounds like a mouthful, lets take a step back. In the cryptocurrency world, much of the press and attention right now is around bitcoin, since the price of bitcoin is flying: its up 200% in 2017 so far.

But the price of a rival cryptocurrency, ether, has seen a bump as well: its up 174% in the past month, to $263. Ether is the currency of the Ethereum network, which is a blockchain for smart contracts.

Price of ether in 2017. (CoinMarketCap)

While bitcoin runs on the bitcoin blockchain, a decentralized, permissionless ledgerand blockchain technology originated with bitcoin in 2009Ethereum runs on its own blockchain specifically designed for smart contracts.

Smart contracts are coded agreements that live in a permanent address on the Ethereum chain. These agreements can interact with other contracts to automatically enact functions.

In other words, smart contracts is a fancy way of saying computer programs. For example: on Ethereum, we could exchange the title deed to a car, directly from seller to buyer. In a recent Cognizant survey of 578 financial service firms, 78% of respondents said their firm is exploring multiple blockchain platformsof those, 49% listed the bitcoin blockchain, 42% said Ethereum.

While bitcoin is soaring as a speculative investment, there arent yet obvious mainstream uses for the currency beyond trading and holding it; many in the industry await the killer app for bitcoin.

There is arguably more excitement right now around the uses of Ethereum, since it was created specifically for smart contracts (not for the currency, which is just an incentive token for developers). TechCrunch writes that Ethereum is poised to overhaul open-source development. And Ethereum founder Vitalik Buterin (just 23 years old) met with Vladimir Putin this week, who praised Ethereum.

That brings us to DAO.Casino, one of the many startups that believes it can solve a problem using Ethereum. On June 29, DAO.Casino will launch an ICO (initial coin offering), a popular new way of raising money for cryptocurrency startups in which investors buy up the startups own coin and pay for it with a more established coin. Ethereum did its own ICO in 2014, in which investors bought ether using bitcoin. An ICO typically lasts for a month. Think of an ICO as the equivalent of a VC round for cryptocurrency startups. In DAO.Casinos ICO, it will sell BET, its own token, in exchange for ether.

Just dont associate DAO.Casino with The DAO, a leaderless, decentralized network that launched in May 2016 (via an ICO that exchanged tokens for ether) as a platform for Ethereum-based projects and was quickly hacked, one month later, to the tune of $50 million. The entire Ethereum blockchain had to perform a split known as a fork in order to restore all the funds stolen in The DAO hack.

DAO.Casino is not an actual casino itself, but an open protocol for online gambling companies (like an online casino, blackjack game operator, or sports betting site) to build on. (DAO.Casino will also build its own branded games.) It isnt aimed at the end userif an online betting site were to use it, the bettor wouldnt have toknow or see that theyre using a system built on Ethereum. (I could even develop my own gambling site on top of DAO.Casinos protocol and pay out users in BET tokens, but rename them Dancoins.) The companys hope is that online betting sites will integrate with its network to offer games without the casino, a middleman that takes a big cut and may not always be trustworthy.

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If youre confused, dont feel bad. In a blog post back in March, the company addressed the confusion its name creates. Many people wonder why do we have DAO in our name, when the term has previously been associated with a hacked investor-directed venture capital fund. They think and we dont blame them for it that is somewhat an extension of an organization whose security loop couldve cost them millions worth of ether. The post goes on to acknowledge that using the DAO acronym is somewhat giving us bad publicity.

Nonetheless, the company embraced the DAO acronym because of what it stands for, a decentralized autonomous organization (which any blockchain-based project is), even if it now carries the stink of The DAO.

Of course, online betting operators may be hesitant to jump on an Ethereum-based protocol for reasons that have nothing to do with DAO.Casinos name.

For starters, the entire cryptocurrency space still has an air of distrust to it; blame the high-profile Silk Road drug market trial, or periodic hacks of bitcoin exchange sites, all of which stoke negative headlines. As one West Coast bankruptcy lawyer, who wishes to remain anonymous, tells Yahoo Finance, I get clients all the time that say, I want to take X and make it better by using cryptocurrency, and its always either a way to try to get around something illegal or it solves a problem that really didnt exist.

Keep in mind also that online gambling (or iGaming) is still illegal in most states in the US, even when the website taking a bet is based outside the US. But online gambling thrives outside America, and is a $46 billion market globally.DAO.Casino could face regulatory scrutiny in the US, even though the company would likely make the argument that it is just an Internet protocol, not the gambling operator.

As of January, nearly 25% of all smart contracts on Ethereum were game-related. Thats why DAO.Casino CEO Ilya Tarutov honed in on a gambling protocol. Traditional server-based online gambling sites dont engender enough trust, he says, but using a decentralized network can add transparency.

Tarutov explained it to Coin Telegraph thusly: Game outcomes are determined by equally unpredictable pseudorandom values, and anyone can audit this. Once the game software is audited and deployed, no one can fiddle with it and change it.

To ensure fairness of games, DAO.Casino implements randomness through PRNGs (pseudorandom number generators), and incentivizes users who develop new games, fund the development of new games, operate casinos, and contribute random-number algorithms by rewarding them in BET tokens. The games built on DAO.Casino will operate in BET. (Grossly simplified, Tarutov explains, BET is a security measure.)

For now, DAO.Casino is in beta, and offers a simple dice game as an example of what it can do. More games are coming, Tarutov says, from online gambling operators ready to put their games on DAO.Casinos testnet. In the next few days, the site will add a blackjack game.

You can register right now and youll get a free token to try these games. But their real purpose is to show developers, Tarutov says, that it is possible to implement serverless and fast PRNG methods on Ethereum. It shows that theres hope and direction. Were confident that we can implement one more method before the end of this year which is suitable for multiplayer games. But this is just a start.

Daniel Roberts closely covers bitcoin and blockchain at Yahoo Finance. Follow him on Twitter at @readDanwrite.

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More than 75 banks are now on Ripples blockchain network

Expect more blockchain hype in 2017

Heres why 21 Inc. is the most exciting bitcoin company right now

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DAO Casino wants to use cryptocurrency to disrupt online gambling - Yahoo Finance

Over the past few months, there has been an increased focus on cryptocurrency ICOs. These initial coin offerings are a great way for investors to buy into a project at an affordable price. At the same time, the project developers try to raise as much money as possible to finish their creation as soon as possible. It is a well-balanced ecosystem, but a lot of people are still confused about certain ICO aspects. In this series, we will try to address some concerns people still have.

As most people should be familiar with by now, buying into a cryptocurrency ICO is the same as backing a project on Kickstarter or IndieGala. Investors receive a reward for pledging money to the cause, even though not all of these projects may succeed in the end. Unlike traditional crowdfunding campaigns, cryptocurrency ICOs do not accept credit cards or other traditional payment methods. Most projects only accept investments in either Ether or Bitcoin, albeit some projects accept additional currencies and tokens as well.

There is another similarity to cryptocurrency ICOs and crowdfunding projects. It is always of the utmost importance to invest as early as possible. In the case of a cryptocurrency ICO, early investors often received a specific percentage of tokens on top of the regular amount. These bonuses can either be time-based or based on the amount of tokens sold already. As we have seen with a lot of recent ICOs, time to buy in is incredibly limited, though.

Even though these similarities between cryptocurrency ICOs and crowdfunding projects should not be overlooked, that is far as both concepts can be compared. With a crowdfunding project, backers can often get a refund of their money if the project fails to deliver. That is not necessarily the case with a cryptocurrency ICO, although most projects lock funds in a smart contract. By using this technology, it is a lot easier to refund investors if needed, albeit that happens very rarely these days.

Moreover, it is always a good idea to check how many tokens will be generated during a particular cryptocurrency ICO. A lot of projects issue a billion tokens or more, which theoretically makes it impossible for them to gain any major value. That is a common misconception, though, as cryptocurrency ICOs often increase their value a tenfold or more in the first few months. Most of these tokens are quickly listed on exchanges, which means there will be plenty of liquidity as well.

Speaking of the number of tokens being issued, there are two creation models projects can make use of. First of all, there is the static supply option with a predetermined value. This means a fixed number of tokens will be issued which will always be sold at the exact same price. This levels the playing field for both early and late investors alike. It is possible this method will be considered less attractive by speculators, since there is no option to buy cheaper coins. Then again, these tokens often see their value appreciate over time just as well as other projects.

The second option revolves around a static supply with a dynamic funding goal. The distribution of cryptocurrency ICO tokens is made based on how much money has been raised to date. More funds raised will result in a higher price per token. This also means early investors will see the value of their token increase during the remainder of the ICO. These are often the most popular types of ICOs, although they often reach their funding goal in minutes or hours.

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Cryptocurrency ICO Education The Basics - The Merkle

By Noel Randewich | SAN FRANCISCO

SAN FRANCISCO Shares of Advanced Micro Devices (AMD.O) surged nearly 9 percent on Tuesday boosted by strong demand for its chips from cryptocurrency miners, leaving short sellers at a loss for the year.

A rally in cryptocurrency Ethereum has boosted demand for graphics chips used by people to "mine" it and other digital currencies, with some of AMD's processors sold out on Amazon.com (AMZN.O) and other retail websites.

Mining for cryptocurrency involves using networks of computers to validate transactions and prevent counterfeit by solving complex mathematical problems. New currency is generated as a reward to the computer operators.

The emergence of Bitcoin in 2009 made cryptocurrency mining popular. Recent rallies in the price of Bitcoin BTC=BTSP and newer digital currency Ethereum have rekindled interest.

Ethereum miners spending as little as $2,000 to build mining computers using graphics processing units, or GPUs, from AMD or its rival Nvidia (NVDA.O) could break even within three or four months, estimated RBC analyst Mitch Steves in a note to clients on Tuesday.

"We think economics suggests that GPUs continue to be sold out," Steves wrote. "We think GPU demand will remain robust as long as the return is under (about) one year."

As of Monday, AMD short sellers had been up about $15 million for 2017. But Tuesdays share surge left them at a loss of $125 million on paper for the year, according to S3 Partners, a financial analytics firm.

That follows losses of over $700 million for AMD short sellers last year, when the stock tripled.

The stock last traded up 7.3 percent at $12.06.

"There are going to be a lot of traders saying, 'This is the last straw. I'm out,'" said Ihor Dusaniwsky, S3's managing director of research.

AMD spokesman Drew Prairie acknowledged that interest from cryptocurrency miners was contributing to demand for the company's chips, but he stressed that game enthusiasts are the core market.

JPMorgan Chase (JPM), Microsoft Corp (MSFT.O), Intel Corp (INTC.O) and more than two dozen other companies have teamed up to develop standards to make it easier for enterprises to use technology related to Ethereum.

Adding to support for AMD's stock, Apple (AAPL.O) on Monday refreshed its lineup of Mac personal computers, including upgraded graphics chips from AMD.

(Reporting by Noel Randewich; Editing by Cynthia Osterman)

Russian security software maker Kaspersky Lab has filed antitrust complaints against Microsoft with the European Commission and the German federal cartel office, it said in a statement on Tuesday.

Amazon.com Inc said on Tuesday it would offer a discount on its popular Prime subscription service for shoppers who receive U.S. government aid, taking aim at a key customer base for rival Wal-Mart Stores Inc.

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AMD rallies as cryptocurrency miners snap up graphics chips - Reuters

Things are looking incredibly promising for Bitcoin and the BTC value right now. With the overall cryptocurrency market cap surpassing US$102bn, the fear of missing out is setting in around the world. A lot of consumers and investors want to ensure they make a strategic investment in cryptocurrency right now. As a result, the Bitcoin price keeps going up and is well underway to hit US$3, 000 in the near future.

Just yesterday, we discussed how the total cryptocurrency market cap would surpass US$100bn very shortly. Fast forward to today, and that is exactly what happened. As of right now, the total market cap sits at over US$102bn, and it seems there is still a lot of room for future growth. A lot of fresh capital has entered the cryptocurrency ecosystem, just as it has done so over the past few weeks.

Rest assured a lot of people are closely monitoring the Bitcoin price right now. A new all-time high has been set virtually every hour, and it looks like the momentum is not over just yet. Right now, one Bitcoin is valued at US$2,908. That means we are getting incredibly close to hitting US$3, 000. This value represents a target most experts claimed was well out of reach. Then again, one cannot properly predict how a free market will evolve despite technical analysis, charts and observations.

Even though Bitcoin is not the only cryptocurrency shooting up in value, it remains the most important one to a lot of traders. If Bitcoins value goes up, so will the value of other cryptocurrencies, digital assets, and tokens. It is in everybodys best interest to see the Bitcoin price appreciate over time. Then again, it is also possible a lot of investors will convert alternative currencies back into Bitcoin, which will lead to some volatility in these markets.

With close to US$2bn in 24-hour trading volume, it is evident demand for Bitcoin is not slowing down anytime soon. Korean exchanges have already projected the Bitcoin value at over US$3,000, although traders in these regions often pay a hefty premium to buy and sell Bitcoin. China has Bitcoin valued slightly higher compared to the American exchanges, although the gap is a lot smaller than most people would expect.

When looking past the Bitcoin trading volume generated by various alternative currencies and tokens for a moment, it is evident fiat currency-based trading is increasing in volume. The USD, KRW, CNY, and even EUR markets are all providing a lot of trading volume right now. This seemingly indicates people are converting their fiat currency to Bitcoin and vice versa. Based on the current charts, it looks like most people are actually buying Bitcoin, rather than selling it. This is a sign of FOMO settling in, although it is still too early to tell what is going on exactly.

For the time being, it is unclear what will happen to the Bitcoin price. The previous sharp increase in value was met with an equally sharp dip shortly after. It is possible Bitcoin will reach US$3, 000 without too many problems. On the other hand, the price may drop a fair before resuming this upward trend. Regardless of which scenario comes true, there will be plenty of eyeballs glued to Bitcoin trading charts over the coming days.

If you liked this article, follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin, cryptocurrency, and technology news.

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Bitcoin Price on Track to hit US$3000, Total Cryptocurrency Market cap Surpasses US$102bn - The Merkle

NuMelo Technology (formerly Ciao Group) today announced bringing Henryk Dabrowksi on board to lead the companys new Cryptographic Enterprises Division.Mr. Dabrowksi comes to

NuMelo after leading Alternet Systems, Inc. (ALTI) in the development and eventual cash sale of ALYIs subsidiary mobile financial transaction software company, Utiba Americas.Utiba remains today as one of the leading mobile financial remittance systems in the world.

Mr. Dabrowksi will now lead NuMelos development of blockchain and Bitcoin solutions in addition to pursuing other cryptocurrency and cryptographic technology enterprise solutions.

NuMelos new, recently announced Cryptography Division is headquartered in the heart of Silicon Valley in San Jose.

Ciao Group is in the process of changing its name to NuMelo Technology first announced back in April as part of a business plan refresh. The refreshed business plan aimsto concentrate on developing locally sourced technology and telecommunication services within frontier and emerging economic markets.

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NuMelo Technology hires Henryk Dabrowski to lead cryptocurrency initiative - CryptoNinjas

The high volatility of exchange value is one barrier to the mass adoption of cryptocurrencies. But for those that have sought to address this with pegged exchange rates, success has been hard to find. Not impossible, though.

Though such currencies seek to eliminate the exchange-rate issue while enjoying the same ease and low-cost of Bitcoin transactions, its been argued that pegging to, say, the dollar, also pegs the currency to the vagaries of institutions like the US Government and Federal Reserve.

The advent of Blockchain 2.0 has enabled the launching of a variety of new digital assets, including currencies pegged to fiat currencies and to gold. Last month saw New Zealand cryptocurrency exchange Cryptopia announce New Zealands first cryptocurrency which will be pegged to the New Zealand dollar.

The main success so far is that of Tether, which is pegged to the US dollar and offers crypto versions of three currencies, known as: USDT, EURT and JPYT. Tether maintains its peg by keeping the US Dollar equivalent of all USDT value in reserves at all times.

Launched in early 2015, Tether has largely kept the peg in place since then. That is, until late April when it crumbled due to issues with the Taiwanese banks they use for receiving and sending USD withdrawals. All incoming international wires to Tether were blocked and refused by the banks. Since then, however, the value of USDT has rallied from $0.93, and it now trades at $1.02.

Other pegged cryptocurrencies have fared less well. CoinoUSD, NuBits, and BitUSD all eschewed the traditional currency pegging method of the holding of reserves in physical dollars or dollar-denominated debt securities.

CoinoUSD began trading in December 2014 and reached a market capitalization plateau of $2.7 million in early 2016. However, it shut down shortly after due to a glitch which flooded customers with free CoinoUSD units, making it impossible to maintain the exchange value at $1.

NuBits are notable for being the first decentralized cryptocurrency to maintain a $1 peg for a period of one year, having accomplished it in September 2015. However, in June 2016, NuBits suffered a devaluation crisis, with the price falling to 20 cents when its rate-pegging mechanism failed. Although the price later returned to par, today NuBits shows very little market activity.

BitUSD is built on the blockchain platform of the cryptocurrency BitSharesX. BitUSD uses a novel pegging system, involving BitShares, that so far has proven robust. The price of 1BitUSD has hovered around $1 and has not experienced any lasting devaluation. However, in part due to the declining use of BitShares, BitUSDs clientele went into serious decline not long after launch. In late April, however, there has been sudden renewed interest which has seen its market cap surge from below $110,000 to a high of just under $2.4m.

Tether slowly built its market cap and started 2017 at just below $10m. Since then it has also enjoyed a surge. Presently, it has reached its current high of $107m and is the outstanding dollar-pegged cryptocurrency.

Despite its surge in popularity, there is still a long way to go for all cryptocurrencies, of course, which have still to experience a full business and credit cycle. Bitcoin price volatility may eventually flatten out when digital currency becomes more widely accepted, but that is still a long way off.

Meanwhile, Tether offers that sought after exchange stability, but questions remain over its decision of a hard peg maintaining a value different to how the market would value it which has already failed.

Perhaps the greatest value of dollar-pegged cryptocurrencies is that they provide a gauge to how much of the demand for cryptocurrencies is transactional versus speculative.

Picture from Pixabay.

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Pegged Cryptocurrencies and Credibility - Crypto Insider (press release) (blog)