Blockchains: Empowering Individuals or Corporations?

TWO MAIN TYPES Not all blockchains are created equal. Some empower individuals, others profit corporations. This article takes a look at who benefits and why. Of course, the world isn’t neatly divided into two categories: people and corporations. Companies are composed of individuals after all. However, the interests of people, in contrast to corporate motivations, may be a useful framework for understanding two primary types of blockchains: “public” and “private”—or perhaps, “public” and “corporate”, is a more apt depiction. Let’s first cover some basic terminology to better make sense of blockchains and how they are used in real-world applications. BLOCKCHAIN JARGON A blockchain is simply a special type of database—one that is usually replicated and distributed amongst numerous interested parties.

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DAO Dilemma: Hard Fork or No Fork

Why I changed my mind and now endorse a hard fork Introduction This post is inspired by a live discussion led by Andreas Antonopoulos on June 29, covering the most recent developments in TheDAO and Ethereum. This excellent discussion can be viewed in its entirety here. The opinions expressed in this article are my own and do not necessarily reflect those of the panelists or other researchers at CryptoIQ. In the spirit of full- disclosure, I own both DAO tokens and ether. Nothing here should be construed as investment advice. A Costly Experiment Shortly after TheDAO hack came to light, and it became evident there is an unintended flaw in the code, allowing an unscrupulous party to enrich itself at

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The DAO Ka-Ching!

The Yin and Yang of Crypto Speculation “Thirty spokes share the wheel’s hub; It is the center hole that makes it useful. Shape clay into a vessel; It is the space within that makes it useful. Cut doors and windows for a room; It is the holes which make it useful. Therefore profit comes from what is there; Usefulness from what is not there.” [1] In Crypto We Trust Ka-ching! The DAO is big news in the startup world, shattering previous records for crowdfunding ventures [2]. With still another two days to go before the offering closes, The DAO has raised an astonishing sum, about $143 million so far, denominated in ether (ETH), the cryptocurrency of the open source Ethereum

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Coding for Better Regulatory Outcomes in The Internet Age of Bitcoin and Blockchains

Background From globally diverse legal perspectives, the current regulations affecting Bitcoin and blockchains are quite disparate, ranging on the spectrum from laissez-faire to outright prohibition, enforced with severe criminal penalties. The conundrum, however, lies with the fact that Bitcoin and blockchains are really an extension of the ever more ubiquitous Internet, albeit a radical extension, permitting digital value to be transmitted peer-to-peer, and diminishing the need for third-party intermediaries, who too often exploit their power and privilege. Given that access to the Internet is proclaimed as a fundamental human right by the UN [1], and that non-profit initiatives from high-profile tech giants such as Google, Facebook, and Microsoft are on a mission to bring the Internet to all corners of

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New Internet Technologies To Remedy The Unfairness of Clickwrap Contracts

“Courts do not enforce consumer-proffered online terms as enforceable contractual terms, but they also do not admit that this is what they are doing. Courts instead exclude the consumer preference from the four corners of the online agreement. What the company wrote is “the contract,” and the expression of consumer preference is simply not part of that contract. Courts manipulate the contours of the contractual agreement to exclude expressions of consumer preference in online agreements. If, however, consumers were able to somehow express their preferences unmistakably within the contours of what courts consider to be the online agreement, then courts would have no choice but to recognize consumer-proffered online contract terms. Instead of just clicking “I Agree,” consumers could actually

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An Open Letter to Banks and Financial Institutions

Advice to Ignore at Your Own Peril By Paul Jones and Albert Szmigielski   To Whom It May Concern: And concerned you should be, gravely. A storm is brewing on the distant horizon, more clearly visible to some than others. From our lookout perch, using high-tech vision enhanced with deep research, the threat is unequivocal. Decisive timing is uncertain but the path well-defined. You can put your heads in the sand, ignoring this destructive force, hoping it will dissipate, suddenly change course, or just die out, but thorough preparation is essential to weather the storm if you hope to survive its devastating aftermath. The tempest is growing with momentum increasing, absorbing the energy from superheated seas, the eye of the

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Ethereum and Democratizing Innovation

Introduction Ethereum is a groundbreaking software innovation designed as a developer-friendly platform for the creation of DApps, aka, decentralized applications. Ethereum draws inspiration from the success and staying power of earlier decentralized Internet technologies such as BitTorrent for file sharing and Bitcoin for cryptocurrency. The ultimate vision of Ethereum is to decentralize the Internet. Why decentralization? With a decentralized architecture, DApps built on the Ethereum platform will be impervious to censorship and thereby allow developers to freely create useful applications without concern of being shut down.  Although built from scratch and unique in implementation, Ethereum uses some innovations from Bitcoin’s architecture, including a decentralized consensus mechanism to unbundle trust, a distributed blockchain ledger to record contracts, and its own crypto-token,

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Uphold, Inc. – Disrupting Global Banking

COMPANY PROFILE Uphold, Inc. is a leader in the rapidly emerging FinTech sector. Uphold’s online platform has a global reach, allowing verified members speed and flexibility in managing their money. Funds can be deposited using standard bank transfers, credit cards, and even bitcoin. Uphold account holders, which include individuals and businesses, can instantly send and receive funds amongst each other, and convert between twenty-three major currencies, four precious metals, and two cryptocurrencies. New commodities and currencies are being added regularly to expand the choices available to Uphold’s members.   VALUATION In January 2015, Uphold closed a Series B round, raising $9.6 million via crowdfunding from institutional and individual investors located in the US and UK. Equity was sold on the

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Ethereum For Everyone

 Introduction Everyone should know about Ethereum—and this article will explain why. The goal here is to describe this groundbreaking software project in layman’s terms. A big-picture approach will be taken, analyzing Ethereum’s design and implementation with comparisons to legacy computer systems. Liberty will be taken to simplify some of the technical details, so emphasis can be placed on the fundamental architecture and socio-economic implications of this radical innovation. Ethereum is an ambitious open source endeavor that promises to change the world by revolutionizing the utility of the Internet [1]. There are far-reaching implications for engineering a better, more honest world. Ethereum is creating a “truth” protocol with unlimited flexibility, allowing anyone and everyone to interact peer-to-peer using the Internet as

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Fun Facts About Factom

Introduction Innovation is a theme that runs throughout this post. New use cases for Bitcoin* and its underlying blockchain are being actively pursued by hundreds of startups around the world. The market cap of Bitcoin currently exceeds six billion dollars, greater than the total of all altcoins combined [1]. Angel investors, venture capitalists, crowdfunding platforms, big banks, and established tech companies are pouring millions of dollars every month into blockchain research and alternative applications [2]. Note, however, that innovation is not limited to the technology itself. The entire digital currency space is spawning all kinds of creative ways to interact with, and potentially profit from, this “emerging” market sector. Many of the blockchain startups are deploying novel business models, and

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New Book Review: Bitcoin and Cryptocurrency Technologies

For anyone serious about understanding the technical inner workings of Bitcoin, Princeton University Press will be releasing a new textbook later this year: Bitcoin and Cryptocurrency Technologies. After studying this book and doing the exercises, you will understand how Bitcoin works in detail, and see why there is so much commercial interest surrounding blockchain technology, not to mention the potential social and political ramifications. This book is both technically rigorous and very accessible—an indispensable reference for any serious student of cryptocurrencies. CryptoIQ’s very own Research Director, Albert Szmigielski, is mentioned in the Introduction for his help in reviewing the text. A free draft version of the book is available here. Check it out! -Paul Jones

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Bitcoin: The Maximum Block Size Debate, Much Ado About Nothing?

Headlines Can Deceive News headlines can be like movie trailers. Too short to give an accurate picture of the full story—designed to grab attention and often deceptive. This article will explain in layman’s terms the issues surrounding one of the hottest Bitcoin * topics of late, known as “the maximum block size debate”. There is a lot of confusion swirling around the media. For those lacking insight into the mechanics of Bitcoin, simply scanning headlines can leave a misinformed impression. Mike Hearn, a former core developer, recently created major commotion with his blog post titled, The resolution of the Bitcoin experiment [1]. His post was followed by a prominent article in the New York Times, sounding a premature death knell

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