It has been an intense week for cryptocurrency holders as bitcoin’s rally “to the moon” took two abrupt pitstops. On May 25, the price of bitcoin briefly dropped $500 from its record high at $2760.10 to recover at around $2,400. Two days later, bitcoin took another dive to below the $2,000 mark and dragged the altcoin market down with it. Popular altcoins such as NEM (XEM), ripple (XRP), ether (ETH), and litecoin (LTC) saw intraday losses ranging from 25 percent to 40 percent on May 27. The market, however, bounced back on the same day, reversing a substantial amount of the losses and most major cryptocurrencies closed the week around their previous week’s closing prices, indicating that the price drops were perhaps just a small correction of an overheated market.
With the Consensus Blockchain Conference having taken place in New York from May 22 to May 24, there have been several industry-relevant announcements concerning the bitcoin economy. The most important one was Digital Currency Group’s Barry Silbert announcement that a broad alliance of miners and companies has been formed, which should mean the end of Bitcoin’s scaling debate. The agreement states that SegWit should be activated soon, and a hard fork will increase the block size limit to 2MB sometime during the next six months.
This week’s review is compiled from contributions by Alex Lielacher, Christoph Bergmann, Jamie Holmes, Joseph Young, Michael Scott, and Nuno Menezes.
Silbert’s Agreement: How a Broad Alliance of Miners and Companies Declared the end of Bitcoin’s Scaling Wars
A consortium of Bitcoin companies and miners announced an agreement about the year long fight for an increase of Bitcoin’s capacity; SegWit should be activated soon, and a hard fork will increase the block size limit to 2MB sometime during the next six months.
The signers declare to do two upgrades in parallel, like the SegWit-2MB proposal suggested: First, SegWit will be activated with a threshold of 80 percent and with signaling on version bit 4. Second, during next six months, a hard fork to a block size of 2MB will be executed.
According to the agreement, the signers represent a critical mass of the Bitcoin ecosystem; 56 companies from 21 countries, which produce 83.28 percent of the global hash rate, process bitcoins worth $5.1 billion each month and maintain 20.5 million wallets for users.
An Italian restaurant and pizzeria named Gusto DiVino announced that it had adopted Waves as its preferred currency. Nestled in Santa Ponca, Mallorca one of Spain’s majestic Balearic Islands in the Mediterranean, the restaurant is owned by Marco Avoledo, known on Twitter as @deepred86. He is active with the WAVES Platform Telegram community, contributing to the cryptocurrency’s global adoption. Avoledo and his business partners, Andrea Gianpiero Lilia and Elisa, decided to champion WAVES as a payment option.
Streamr is a cloud-based platform that reacts to events in real time data streams. The company is an expert in scaling up processes and can redistribute almost anything you can throw at it; millions of events, thousands of different data streams, complex events, and large numbers of users.
The company started a new project where they use the Ethereum blockchain technology to develop an application that shows in real time the US Stock Exchange Price ticks.
Fidelity Investments, one of the largest financial services and investment firms in the US with over $2.13 trillion assets under management and $15.9 billion annual revenue, has announced the integration of Coinbase. According to Fidelity CEO Abigail Johnson, its clients will be able to see their investments in bitcoin and ether on Fidelity’s main platform by the third quarter of 2017.
Switzerland-based cryptocurrency exchange ShapeShift announced on May 19 that it is launching the world’s first trustless digital asset portfolio platform called Prism, which has been built on top of the Ethereum blockchain.
The new portfolio management platform enables humans as well as machines to gain exposure to portfolios of digital assets without having to trust a counterparty. The portfolios, which ShapeShift refers to as “Prisms,” are customizable in allocation, duration, and size. Prisms can be acquired using nothing but an Ethereum wallet and by using ether as the collateral.
Banking giant Citi and technology stock exchange Nasdaq announced a new digital payment solution that provides straight-through processing and automatic payments reconciliation by leveraging blockchain technology to record and transfer payment instructions.
The collaboration between the two New York-based financial services companies has culminated in a pioneering banking solution that integrates distributed ledger technology with Citi’s global financial network’s API technology. The new payment solution has been developed by leveraging Chain’s enterprise blockchain infrastructure to process payments between the CitiConnect® for Blockchain connectivity platform and Nasdaq’s Linq platform.
On May 23, Nikkei reported that Japan’s leading ATM manufacturer Oki plans to launch Bitcoin ATMs, or BTMs, to help users to benefit from higher liquidity and convenience when purchasing and selling the digital currency.
The ATM-Recycler G8, which will be shipped throughout China by the end of May, allows bitcoin users to utilize any personal bitcoin wallets to send funds to the ATM and withdraw cash with a short processing period and low fees. If its launch is successful in China, the Oki team plans to distribute the ATM-Recycler G8 internationally. Depending on the demand for bitcoin from local financial institutions, Oki may launch its bitcoin-accepting ATMs in Japan within 2017.
On May 2, Missouri-based tech entrepreneur Jason R. Klein pleaded guilty in federal court to charges of running an illegal money transmitting business by converting bitcoin into cash without a license using the popular peer-to-peer marketplace LocalBitcoins. For his actions, Klein could face up to five years in federal prison.
Instead of bringing the case in front of a grand jury, Klein decided to waive this right and pleaded guilty before the U.S. Magistrate Judge David P. Rush on charges of “conducting an unlicensed and unregistered money transmitting business.”