Bitcoin – Bitcoin Price Live, BTC Value, Mining, BTC to USD …


Bitcoin was created by an anonymous name called Satoshi Nakamoto Other notable names rumored to be part of the team include

The practical uses of Bitcoin

If you have the required hardware, you can mine bitcoin even if you are not a miner. There are different ways one can mine bitcoin such as cloud mining, mining pool, etc. For cloud mining, all you need to do is to connect to the datacenter and start mining. The good thing about this is that you can mine from anywhere and you dont need a physical hardware to mine.

For mining pool, all you need to do is to join a mining group, and if that team solves a computational problem, blocks are added to the blockchain, they get the reward and you get a share of it based on your contribution.

PoW algorithm-SHA-256 is used for mining. Which utilizes a lot of computational power.

Bitcoin mining saps energy, costly, uses more power and also the reward delays. For mining, run software, get your wallet ready and be the first to solve a cryptographic problem and you get your reward after the new blocks have been added to the blockchain.Mining is said to be successful when all the transactions are recorded in the blockchain and the new blocks are added to the blockchain.

Notes for investors

Die-hard Bitcoin supporters believe that bitcoin is the future; we are just scratching the surface.Considering the continuous rise of bitcoin in the market capitalization, it is one investment every investor needs to take advantage of it.

The current market capitalization of bitcoin stands at an all-time high of $109 billion. As at January 2016, bitcoin was traded at I BTC for $970 but today is being traded at $6,600 for 1 BTC.

From the statistics presented above, it that bitcoin is one investment, you will never regret embarking on. It keeps recording an impressive results daily in the cryptocurrency market.


Cryptocurrency investment is speculative, and it involves unquantifiable risks the market is full of uncertainty, susceptible to attack and capital loss, and sensitive to secondary issues, time may do not permit to mention here.Seek advice before investing.

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Bitcoin – Bitcoin Price Live, BTC Value, Mining, BTC to USD …

Standard Exchanges

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Standard Exchanges

Must I pay tax this year if I transfer bitcoin from …

“In 2014, the IRS issued a noticeclarifying that it treats digital currencies such as Bitcoin as capital assets and are therefore subject to capital gains taxes. The notice provides that virtual currency is treated as property for U.S. federal tax purposes, it reads. General tax principles that apply to property transactions apply to transactions using virtual currency.

The character of gain or loss from the sale or exchange of virtual currency depends on whether the virtual currency is a capital asset in the hands of the taxpayer.

Thus, not every transfer of funds is considered a sale. For the user, sending bitcoins from a Coinbase account to their Trezor hardware wallet, for example, is only a transfer and not a sale since the user is still in possession of the coins.

You should keep your own records for best results and update the report accordingly, Coinbase support explains. For example, if you transfer funds offsite to a desktop wallet, and then back again, you would not count this as a sale of digital currency.

Continued here:

Must I pay tax this year if I transfer bitcoin from …

Will a 1099-B form work best for reporting bitcoin …

How to report bitcoin transactions depends on how they are classified.

Here is some TurboTax guidance to help you decide where to report transactions:

It depends on how those currencies were held and used. Based on that, the IRS determines whether to treat the currency as income or property.

Bitcoin used to pay for goods and services is taxed as income:

Bitcoin held as capital assets is taxed as property:

If you hold Bitcoin as a capital asset, you must treat it as property for tax purposes. General tax principles applicable to property transactions apply. In other words, just like stocks or bonds, any gain or loss from the sale or exchange of the asset is taxed as a capital gain or loss. Otherwise, the investor realizes ordinary gain or loss on an exchange.

Bitcoin received as incomeand then held and sold for profitis taxed as both:


Yes. The IRS is taking cryptocurrency very seriously, to the extent that they took the digital currency exchange Coinbase to court to obtain user records and now have a contract with digital forensics company Chainalysis to help track cryptocurrency transactions.

Note: Many people have been unsure of how to treat Bitcoin, so you may have recorded earnings incorrectly on prior returns. If you need to amend a previous return, follow these steps. (We also have a video that shows you how.)


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Will a 1099-B form work best for reporting bitcoin …

Bitcoin (BTC) price: News & Live Chart – Trading Analysis …

Bitcoin is a digital currency, sometimes referred to as a cryptocurrency, best known as the world’s first truly decentralized digital currency. Bitcoin is traded on a peer-to-peer basis with a distributed ledger called the Blockchain, and the Bitcoin exchange rate to the US Dollar and other major currencies is determined by supply and demand as with other global exchange rates. The traded value of Bitcoin has proven volatile through various booms and busts in demand. Ultimately, however, many see Bitcoin as a store of value against government-backed fiat currencies.

Abbreviated as BTC, Bitcoin is actively traded against the world’s major currencies across decentralized markets. Bitcoins are kept in so-called Bitcoin wallets, which depend on private keys and cryptography to secure its Bitcoins to a specific entity or user.

By comparison to government-backed global currencies, Bitcoin remains fairly complex for the typical user to acquire and use in regular transactions. Growing interest and significant global investments in Bitcoin wallet and Blockchain technology have nonetheless made buying and selling Bitcoin far more accessible to the average user. And indeed growing acceptance by government entities have ameliorated the ambiguity of legal and regulatory status for Bitcoin and Bitcoin exchanges.

You can find historical price of Bitcoin on our chart and latest news and analysis on the Bitcoin exchange rate.

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Bitcoin (BTC) price: News & Live Chart – Trading Analysis …

What is Bitcoin? – Definition from

Bitcoin is a digital currency (also called crypto-currency) that is not backed by any country’s central bank or government.Bitcoins can be traded for goods or services with vendors who accept Bitcoins as payment.

Bitcoin-to-Bitcoin transactions are made by digitally exchanging anonymous, heavily encrypted hash codes across a peer-to-peer (P2P) network. The P2P network monitors and verifies the transfer of Bitcoins between users. Each user’s Bitcoins are stored in a program called a digital wallet, which also holds each address the user sends and receives Bitcoins from, as well as a private key known only to the user.

The Bitcoin network is designed to mathematically generate no more than 21 million Bitcoins and the network is set up to regulate itself to deal with inflation.Bitcoins can be spent by initiating a transfer request from a Bitcoin address in the customer’s wallet to a Bitcoin address in the vendor’s wallet. As of this writing, one Bitcoin (also called a BTC) is worth $104 — but just as with stocks, the value of Bitcoins can fluctuate quickly.

In the United States, Bitcoins are controversial because they can be used to anonymously transfer illicit funds or hide unreported income from the Internal Revenue Service (IRS). Bitcoin policy now requires transactions that involve traditional, government-backed currencies to be attached to an identity.

This CNN video provides an overview of Bitcoin:

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What is Bitcoin? – Definition from

Bitcoin and Blockchain – Bloomberg

By and

Updated on January 28, 2018, 9:40 PM EST

When Bitcoin broke intopublic consciousnessin 2013, it couldnt have been sexier: a digital currency being used to buy everything from drugs to cupcakes. Then the excitement shifted to an aspect of Bitcoin that is a bit less sexy: public online ledgers. Blockchain the technology used for verifying and recording transactions thats at the heart of Bitcoin is seen as having the potential to reshape the global financial system and possibly other industries. Both Bitcoin and its blockchain are gaining imitators as well as adherents, along with plenty of critics, includingJamie Dimon, the chief executive officer of JPMorgan Chase & Co. Its recentwild price surge and fall has given ammunition to both.

The price of Bitcoin rocketed in 2017 before giving up much of those gains, as the debate raged on whether the cryptocurrency whose total value neared $300 billion in early December should be considered a legitimate financial asset. It got a huge boost when Cboe Global Markets Inc., started futures trading tied to the digital currency and CME Group Inc. andNasdaqInc., said they would follow suit. Futures trading will push Bitcoin closer to the mainstream by making it easier to trade without the hassles of owning it directly. Bitcoin began to look almost traditional compared with the new cryptocurrencies that raised more than $3.5 billion throughinitial coin offerings. Theirexplosive growth drew warnings from regulators around the globe even beforehackers stole almost $500 million worth of a digital token called NEM from a Japanese cryptocurrency exchange. The Bitcoin community came together (mostly) in November to reject a proposed software change that had threatened a split. Meanwhile, more than 100 banks are working within theR3 consortium,created to find ways to use blockchain as a decentralized ledger to track money transfers and other transactions. Australia’s stock exchange plans to start using blockchain to process equity transactions.Blockchain is also being tested by retailers like Wal-Mart Stores Inc. forensuring foodsafety, as industries explore what advantages the technology might hold over traditional databases.

Virtual currencies arent new online fantasy games have long used them but the development of a secure digital currency without a central issuer rightly turned heads. Mysterious spikes and drops in the price of Bitcoin since its birth helped build an early reputation for the currency as a tool for selling drugs and laundering money. Its history also featured arrests for Ponzi schemes. Theperson or peoplewho created the Bitcoin system under the pseudonym Satoshi Nakamoto solved a problem central to any currency preventing counterfeiting and did it without relying on a governments authority. The softwarealso solved one specific hurdle for digital money how to stop users from spending the same unit of currency twice. The breakthroughideawas blockchain, a publicly visible, anonymous online ledger that records every single Bitcoin transaction. Its maintained by a network of miners whose computers perform the calculations that validate each transaction, preventing double-spending. They earn a reward of newly issued Bitcoin. The pace of creation is limited, and no more than21 millionwill ever be issued.

Since Bitcoin first boomed, theres been no shortage of critics to call its rise abubbleand to argue that the currency has no intrinsic value. In September, Dimon called Bitcoin a fraud.But a month later his chief financial officer followed rivals at Goldman Sachs Group Inc. and Citigroup Inc. in expressing openness to working with cryptocurrencies.Entrepreneurs in the field say that focusing on the price of Bitcoin is missing the point its value is as proof of concept for a new kind of payment system not reliant on third parties like governments, big banks or credit-card companies. Others say blockchain advocates are hyping what amounts to no more than a new kind of database. Proponents of ether, the second most commonly used digital currency, respond that the etherium blockchaindoes far more than let Bitcoin users send value from one person to another. Its advocates think it could be a universally accessible machine for running businesses, as the technology allows people to do more complex actions in a shared and decentralized manner.

First published Oct. 3, 2013

To contact the writers of this QuickTake: Olga Kharif in Portland at Matthew Leising in Los Angeles at

To contact the editor responsible for this QuickTake: John O’Neil at

The rest is here:

Bitcoin and Blockchain – Bloomberg

Bitcoin – Topics

11:31 p.m. March 11, 2018 – By Kevin Kingsbury

Asian markets start the week off strong, building on last weeks rebound Nikkei pushes higher; New Zealand index sees record closeAsia-Pacific stock markets were higher Monday, building on a late-week rebound for the regions equities.

11:55 a.m. March 11, 2018 – By Shawn Langlois

Alt-coin traders share their portfolio-of-horror storiesBitcoins whipsaw reversal has been well-chronicled, but its the other digital currencies Reddit members were talking about when someone suggested, Lets play a game called How much down is your (alt) portfolio?

8:41 a.m. March 10, 2018 – By Maria LaMagna

This credit card will offer rewards in bitcoin and has 2,000 people on the waiting list This company has ambitions to start a credit card that gives crypto instead of pointsThis company has ambitions to start a credit card that gives crypto instead of points.

5:00 a.m. March 10, 2018 – By MarketWatch

The other assets that are in a bull market along with U.S. stocksU.S. stocks are not the only asset currently in a bull market. European, Japanese equities are also enjoying rising prices.

1:26 p.m. March 9, 2018 – By Barbara Kollmeyer

Bitcoin rout continues, records 5th consecutive losing day Brutal week sees bitcoin shed 20%Bitcoin prices continued to drop on Friday, as bloodbath in No. 1 digital currency persists.

1:00 p.m. March 9, 2018 – By MarketWatch

Dow closes above 25,000 while Nasdaq finishes at a record as stocks rallyThe Dow closes above the 25,000 mark and the Nasdaq ends at a record on Friday as Wall Street appeared to shake off worries about tariffs on steel and aluminum to focus on the jobs report that came in stronger than had been estimated.

12:12 p.m. March 9, 2018 – By Aaron Hankin

When will bitcoins bloodletting cease? Fundstrats Lee turns to the Bitcoin Misery Index for answers The value of a single bitcoin has shed about 20% of its value over the past week, but the worst may be near, says Lee The viscous selloff in bitcoin has even the biggest bulls scratching their heads. With a fall of more than 20%, and a raft of negative press, investors are searching for a signal to buy this dip.

6:57 a.m. March 9, 2018 – By Aaron Hankin

Heres how much it costs to mine a single bitcoin in your country Looking to mine bitcoin on the cheap? Head to Venezuela So, where is the cheapest place to mine bitcoin?

6:16 a.m. March 9, 2018 – By Victor Reklaitis

Go big on stocks as Trump has 1 huge reason not to launch a trade war, says quant Critical information for the U.S. trading dayStocks look set for a weekly win, amid buzz about the Trump-Kim meeting, tariffs and the jobs report. Fears about inflation, rates, trade wars and growth are overblown, says todays call from a J.P. Morgan guru whos overweight U.S. stocks.

1:24 p.m. March 8, 2018 – By Aaron Hankin

Bitcoin falls again, now down 20% on the week Futures markets record third consecutive losing dayDigital currencies take another step lower.

12:42 p.m. March 8, 2018 – By Maria LaMagna

Hush agreements and a credit card that will give rewards in bitcoin Thursdays top personal finance stories Thursdays top personal finance storiesThursdays top personal finance stories

12:29 p.m. March 8, 2018 – By Ryan Vlastelica

The best sector of this bull market is the greatest investment story ever told Internet stocks set the pace in markets 9-year bull runWhile the strategy of investing in internet-related companies will likely always be first associated with the dot-com era, the past decade has proved to be just as strong a period for the sector that has now influenced nearly every aspect of the economy.

12:10 p.m. March 8, 2018 – By MarketWatch

This weeks Mutual Funds and ETF storiesConventional investing wisdom tends to fall by the wayside when the stock market seems to offer only upside.

7:48 a.m. March 8, 2018 – By Ryan Vlastelica

Heres why retiring baby boomers wont create a stockmaggedon for millennials Market returns dont have a strong correlation to demographic trendsThe retirement of the baby boomer generation is one of the biggest shifts currently happening in the U.S., carrying significant long-term implications for government spending and the labor market. But could it have an impact on the stock market?

3:29 a.m. March 8, 2018 – By Carla Mozee

Japan suspends two cryptocurrency exchanges in hopes of strengthening security Japans crackdown comes after $530 million in NEM cryptocurrency was stolen Two cryptocurrency exchanges were temporarily suspended by a Japanese regulator Thursday as part of its effort for stronger security in the market after millions of dollars in digital currency was stolen earlier this year.

12:27 a.m. March 8, 2018 – By Shawn Langlois

Steve Bannon tells European audience: cryptocurrency will bring you true freedomAt this stop on his European speaking tour, Trumps former top adviser explained why digital currencies like bitcoin could be an asset to the Continents antiestablishment movement.

9:05 p.m. March 7, 2018 – By Ellie Ismailidou

How to invest in blockchain without buying bitcoinWhen it comes to blockchain technology, one of the most common mistakes investors make is equating blockchain to bitcoin and other cryptocurrencies. Here’s how to invest in blockchain without buying any cryptocurrency.

7:44 p.m. March 7, 2018 – By Mike Murphy

Crypto bull John McAfee says SEC is striking out in panic at digital currencies SEC had earlier warned of risk some crypto exchanges pose to investorsAnti-virus tycoon-turned-cryptocurrency bull John McAfee lashed out at the Securities and Exchange Commission on Wednesday night, claiming that the agency is running scared.

11:41 a.m. March 7, 2018 – By Sally French

Heres how many of the worlds ultrawealthy are increasing their cryptocurrency investments If youre like 21% of the worlds truly rich, youve gotten more into cryptos21 percent of respondents in an annual survey of wealth advisers and private bankers said their clients increased their investments in cryptocurrencies in 2017

10:29 a.m. March 7, 2018 – By Aaron Hankin

Binance tells customers funds are safe after tech glitchBinance CEO Zhao Changpeng on Wednesday said its customers’ funds were safe, as the head of the popular exchange attempted to assure investors after a glitch in its system. Reports of problems on the platform surfaced via online forum Reddit, indicating that so-called altcoins, or alternatives coins to bitcoin , were being liquidated from users’ accounts without their consent. The technology issue resulted in Binance temporarily suspending withdrawals. However, in a tweet from its official account, Binance described the issues as “irregularities in trading activity” and emphasized that “all funds are safe.” Binance didn’t immediately respond to a request for comment.

9:33 a.m. March 7, 2018 – By Aaron Hankin

Bitcoin price drop gathers momentum as potential Binance glitch unsettles investors Virtual-currency traders also react to the SEC demanding that exchanges register with its regulatorMajor cryptocurrencies fell sharply Wednesday as reports of a system errors at a popular exchange platform appeared to unsettle investors.

8:00 a.m. March 7, 2018 – By MarketWatch

Heres why buying the Cohn dip may be better than selling the panicAhead of what looks like a rough day for stocks as they fret anew over White House departures and trade-war concerns, out call of the day says buy this dip before its too late.

5:57 a.m. March 7, 2018 – By Barbara Kollmeyer

Heres why buying the Cohn dip may be better than selling the panic Critical information for the U.S. trading dayAhead of what looks like a rough day for stocks as they fret anew over White House departures and trade-war concerns, out call of the day says buy this dip before its too late.

5:23 a.m. March 7, 2018 – By Emily Bary

PayPal crypto patent interesting but may no longer be a top priority, says analystPiper Jaffray analyst Jason Deleeuw weighed in on PayPal Holdings Inc.’s potential cryptocurrency efforts Wednesday, after was made public earlier in the month. PayPal’s patent filing was for an “expedited virtual currency transaction system,” which could speed up cryptocurrency transactions by allowing buyers and sellers to trade private keys and not wait for transactions to be confirmed on the blockchain, Deleeuw wrote. He noted that “Bitcoin transactions are not confirmed until they are batched in a block and added to the blockchain,” which can take about 10 minutes. Deleeuw sees some challenges for PayPal if it were to get involved with crypto in this way, noting for one that “the reliance on PayPal for enabling this solution defeats the decentralized purpose of cryptos.” He added that while the patent was recently made public, it was filed in mid-2016, and recent comments from management suggest to him that PayPal may have “de-prioritized” such efforts in the last 18 months. “Still, we like that PayPal is exploring how to improve crypto asset accessibility,” he wrote. PayPal shares are up 85% over the past 12 months, while the S&P 500 has gained 15%. Square Inc. , another popular payments stock, has seen shares rise sharply in recent months after it began allowing users to buy and sell bitcoin on its peer-to-peer Cash app.

12:37 a.m. March 7, 2018 – By Mike Murphy

Coinbase launches its first index fund for cryptocurrencies For now, fund will track four digital currencies, be limited to accredited usersCoinbase, the popular cryptocurrency exchange, is launching a weighted index fund for digital currencies as it enters the asset-management business for the first time.

1:37 p.m. March 6, 2018 – By Aaron Hankin

Coinbase’s COO Hirji says digital exchange to offer cryptocurrency-focused index fundCoinbase’s President & Chief Operating Officer Asiff Hirji late Tuesday said the popular digital-currency platform would kick off a crypto-focused index fund. Hirji told CNBC during an interview on its “Fast Money” segment that the planned index fund is intended to give retail investors broad exposure to virtual currencies. The COO said the fund is still in the works and would be targeted to accredited investors, with a specified net worth. Hirji said the index fund would be market-cap weighted but didn’t offer more details.

1:30 p.m. March 6, 2018 – By Barbara Kollmeyer

Bitcoin drops below $11,000, pulls back from key breakthrough level A tough day for crypto traders as all major digital currencies finish in the redBitcoin struggles to break above $12,000 on Tuesday, as a popular cryptocurrency exchange faces allegations of taking unfair profits.

1:00 p.m. March 6, 2018 – By MarketWatch

Here are the states most threatened by steel tariffsHeres a state-by-state rundown on jobs that could be at risk if Donald Trump follows through on across-the-board tariffs on steel and aluminum.

8:00 a.m. March 6, 2018 – By MarketWatch

Theres no stopping it, warns Ron Paul: A calamity could cut this market in halfSuch a calamity could very well lead to a 50% drop in the stock market, Paul warns.

7:36 a.m. March 6, 2018 – By Leslie Albrecht

Good news for people who havent got a clue about cryptocurrency Searches for the definition of bitcoin tend to spike along with the volatile currencys valueSearches for the definition of bitcoin tend to spike along with the volatile currencys value.

5:00 a.m. March 6, 2018 – By MarketWatch

Dow futures over 100 points higher, lifted by Korea talks, easing trade worriesU.S. stock futures jump, getting an additional boost from headlines linked to talks between North and South Korea and as fears over a full-blown trade war calmed down.

4:28 a.m. March 6, 2018 – By Aaron Hankin

The chance of hacking a bitcoin wallet is as likely as winning Powerball9 times in a row Trying to guess a Bitcoin key? Youre wasting your timeBitcoin skeptics who stay away digital currencies for fear their fortune may be stolen can rest easy.

1:49 a.m. March 6, 2018 – By Barbara Kollmeyer

Forget $100,000 bitcoin, says Kenneth Rogoff try $100 instead Regulation will bring down the price of the cryptocurrency within 10 years, the Harvard economist saysRegulation will bring down the price of the cryptocurrency within 10 years, the Harvard economist says.

1:00 a.m. March 6, 2018 – By Nouriel Roubini

Roubini: Blockchain is one of the most overhyped technologies ever This is why Bitcoin and other inefficient cryptocurrencies wont take over the worldBlockchain is an overhyped technology that is too inefficient and slow to revolutionize the payments system, write Nouriel Roubini and Preston Byrne.

12:57 a.m. March 6, 2018 – By Mike Murphy

Coinbase hit with two class-action lawsuits, one claiming insider trading Cryptocurrency exchange faces claims of ripping off customersPopular cryptocurrency exchange Coinbase is facing two new class-action lawsuits, including one that accuses it of insider trading.

12:57 p.m. March 5, 2018 – By Aaron Hankin

Bitcoin meets resistance at $12,000, as Ripple bounces PayPal files patent for system that would speed up transaction timesAfter a relatively rocky week for equity investors, those in the cryptocurrency space have feared much better as digital currency prices continue to tick higher over the weekend.

9:51 a.m. March 5, 2018 – By Emily Bary

PayPal files patent for cryptocurrency systemPayPal Holdings Inc. shares are up 0.5% in midday trading Monday after it was revealed that the company recently related to bitcoin. The company’s patent filing was for an “expedited virtual currency transaction system” and was . Such a system could potentially speed up bitcoin transactions and be anonymous. Shares of PayPal were originally down to start the day after the Wall Street Journal reported that Inc. was interested in creating its own product similar to a checking account. PayPal’s stock is up 84% over the past 12 months, while the S&P 500 Index has gained 14%.

9:48 a.m. March 5, 2018 – By Emily Bary

Square stock jumps 8%, on track to close at new record highShares of Square Inc. are up 8.5% in Monday trading and on track to close at a new all-time high. If the current gains hold, this would mark Square’s largest one-day percentage gain since May 4, 2017, when its stock rose 8.9%. The company said late Friday that its general counsel, Hillary Smith, would be resigning, and Square confirmed to MarketWatch that it hasn’t announced any news. The company announced better-than-expected earnings last week and CEO Jack Dorsey also said at the time that the company wanted to enhance its bitcoin offerings . Square shares are up 194% over the past 12 months, while the S&P 500 is up 14%.

4:51 a.m. March 5, 2018 – By Victor Reklaitis

One way to play Trumps tariffs: Buy these stocks and enjoy the heat Critical information for the U.S. trading dayThe Dow looks like it might want to fall for a fifth-straight session to kick off the week, as hand-wringing about a potential trade war persists. One product of President Trumps tariff plan: a rise in bullish calls on steel stocks.

8:32 a.m. March 4, 2018 – By Emily Bary

Square earnings: Cheers for Cash, Caviar and larger customers Analysts praise growth in Squares services revenue and its continued move upmarket despite weaker-than-expected forecastSquare shares are up 166% over the past 12 months. Analysts found more reasons to be optimistic about future growth in the latest quarterly numbers.

Original post:

Bitcoin – Topics

Paypal Files Patent for Expedited … –

A recent patent filing reveals that Paypal might be considering expanding its exposure to the cryptocurrency ecosystem with a new system for speedy transactions. We shouldnt however expect a Paypal Lightning Network or anything close to that any time soon. There is currently a global race to file patents for everything crypto or blockchain related and the company might just be strengthening its portfolio for future patent battles.

Also Read: Bitfarms to Raise Up to CAD$50m to Scale Cryptocurrency Mining Operation

Online payments provider Paypal (NASDAQ:PYPL) has filed a new patent application for an expedited virtual currency transaction system with the US Patent and Trademark Office. The last time it was reported that the company filed a patent application related to cryptocurrencies was back in mid-2016 when it showed plans for a modular payment module that accepted bitcoin, litecoin and dogecoin.

The system described by the patent application is meant to work by creating secondary wallets that each include a respective secondary wallet private key, and a transaction is performed using the primary wallet private key to transfer different predefined amounts to each of the secondary wallets. When an instruction is received to transfer a payment amount to a second user, they are allocated a subset of the first users secondary wallet private keys that together contain cryptocurrency that equals the needed amount.

The Paypal application explains that the need for this proposed system for cryptocurrencies is due to the time delay or latency period between the initialization of the transaction and the point at which the transaction has been confirmed. It gives as an example waiting for ten minutes or more for a bitcoin conformation, which they indicate hurts the user experience, putting it at a disadvantage over seemingly instant choices such as fiat credit card payments.

In many transaction situations, a 10 minute wait time will be too long for payers and/or payees, and those payers and/or payees will instead choose to perform the transaction using traditional payment methods rather than virtual currency. Issues like this have slowed the adoption of virtual currencies despite their advantages. Thus, there is a need for an expedited virtual currency transaction system, explains Paypal.

What could Paypal be planning to do with cryptocurrency related patents? Tell us what you think in the comments section below.

Images courtesy of Shutterstock.

Do you like to research and read about Bitcoin technology? Check out Bitcoin.coms Wiki page for an in-depth look at Bitcoins innovative technology and interesting history.

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Paypal Files Patent for Expedited … –

Bitcoin Energy Consumption Index – Digiconomist

Key Network Statistics Bitcoin’s current estimated annual electricity consumption* (TWh)52.03Annualized global mining revenues$8,474,868,923Annualized estimated global mining costs$2,601,535,436Country closest to Bitcoin in terms of electricity consumptionRomaniaEstimated electricity used over the previous day (KWh)142,549,887Implied Watts per GH/s0.233Total Network Hashrate in PH/s (1,000,000 GH/s)25,438Electricity consumed per transaction (KWh)784.00Number of U.S. households that could be powered by Bitcoin4,817,658Number of U.S. households powered for 1 day by the electricity consumed for a single transaction26.5Bitcoin’s electricity consumption as a percentage of the world’s electricity consumption0.23%Annual carbon footprint (kt of CO2)25,495Carbon footprint per transaction (kg of CO2)384.15

*The assumptions underlying this energy consumption estimate can be found here. Criticism and potential validation of the estimate is discussed here.

Ever since its inception Bitcoins trust-minimizing consensus has been enabled by its proof-of-work algorithm. The machines performing the work are consuming huge amounts of energy while doing so. The Bitcoin Energy Consumption Index was created to provide insight into this amount, and raise awareness on the unsustainability of the proof-of-work algorithm.

Note that the Index contains the aggregate of Bitcoin and Bitcoin Cash (other forks of the Bitcoin network are not included). A separate index was created for Ethereum, which can be found here.

New sets of transactions (blocks) are added to Bitcoins blockchain roughly every 10 minutes by so-called miners. While working on the blockchain these miners arent required to trust each other. The only thing miners have to trust is the code that runs Bitcoin. The code includes several rules to validate new transactions. For example, a transaction can only be valid if the sender actually owns the sent amount. Every miner individually confirms whether transactions adhere to these rules, eliminating the need to trust other miners.

The trick is to get all miners to agree on the same history of transactions. Every miner in the network is constantly tasked with preparing the next batch of transactions for the blockchain. Only one of these blocks will be randomly selected to become the latest block on the chain. Random selection in a distributed network isnt easy, so this is where proof-of-work comes in. In proof-of-work, the next block comes from the first miner that produces a valid one. This is easier said than done, as the Bitcoin protocol makes it very difficult for miners to do so. In fact, the difficulty is regularly adjusted by the protocol to ensure that all miners in the network will only produce one valid bock every 10 minutes on average. Once one of the miners finally manages to produce a valid block, it will inform the rest of the network. Other miners will accept this block once they confirm it adheres to all rules, and then discard whatever block they had been working on themselves. The lucky miner gets rewarded with a fixed amount of coins, along with the transaction fees belonging to the processed transactions in the new block. The cycle then starts again.

The process of producing a valid block is largely based on trial and error, where miners are making numerous attempts every second trying to find the right value for a block component called the nonce, and hoping the resulting completed block will match the requirements (as there is no way to predict the outcome). For this reason, mining is sometimes compared to a lottery where you can pick your own numbers. The number of attempts (hashes) per second is given by your mining equipments hashrate. This will typically be expressed in Gigahash per second (1 billion hashes per second).

The continuous block mining cycle incentivizes people all over the world to mine Bitcoin. As mining can provide a solid stream of revenue, people are very willing to run power-hungry machines to get a piece of it. Over the years this has caused the total energy consumption of the Bitcoin network to grow to epic proportions, as the price of the currency reached new highs. The entire Bitcoin network now consumes more energy than a number of countries, based on a report published by the International Energy Agency. If Bitcoin was a country, it would rank as shown below.

Apart from the previous comparison, it also possible to compare Bitcoins energy consumption to some of the worlds biggest energy consuming nations. The result is shown hereafter.

Bitcoins biggest problem is not even its massive energy consumption, but that the network is mostly fueled by coal-fired power plants in China. Coal-based electricity is available at very low rates in this country. Even with a conservative emission factor, this results in an extreme carbon footprint for each unique Bitcoin transaction.

To put the energy consumed by the Bitcoin network into perspective we can compare it to another payment system like VISA for example. According to VISA, the company consumed a total amount of 674,922 Gigajoulesof energy (from various sources) globally for all its operations. This means that VISA has an energy need equal to that of around 17,000 U.S. households. We also know VISA processed 111.2 billion transactions in 2017. With the help of these numbers, it is possible to compare both networks and show that Bitcoin is extremely more energy intensive per transaction than VISA (note that the chart below compares a single Bitcoin transaction to 100,000 VISA transactions).

Of course, these numbers are far from perfect (e.g. energy consumption of VISA offices isnt included), but the differences are so extreme that they will remain shocking regardless. Acomparison with the average non-cash transaction in the regular financial system still reveals that an average Bitcoin transaction requires several thousands of times more energy. One could argue that this is simply the price of a transaction that doesnt require a trusted third party, but this price doesnt have to be so high as will bediscussed hereafter.

Proof-of-work was the first consensusalgorithm that managed to prove itself, but it isnt the only consensusalgorithm. More energy efficient algorithms, like proof-of-stake, have been in development over recent years. In proof-of-stake coin owners create blocks rather than miners, thus not requiring power hungry machines that produce as many hashes per second as possible. Because of this, the energy consumption of proof-of-stake is negligible compared to proof-of-work. Bitcoin could potentially switch to such an consensusalgorithm, which would significantly improve sustainability. The only downside is that there are many different versions of proof-of-stake, and none of these have fully proven themselves yet. Nevertheless the work on thesealgorithms offers good hope for the future.

Even though the total network hashrate can easily be calculated, it is impossible to tell what this means in terms of energy consumption as there is no central register with all active machines (and their exact power consumption). In the past, energy consumption estimates typically included an assumption on what machines were still active and how they were distributed, in order to arrive at a certain number of Watts consumed per Gigahash/sec (GH/s). A detailed examination of a real-world Bitcoin mineshows why such an approach will certainly lead to underestimating the networks energy consumption, because it disregards relevant factors like machine-reliability, climate and cooling costs. This arbitrary approach has therefore led to a wide set of energy consumption estimates that strongly deviate from one another, sometimes with a disregard to the economic consequences of the chosen parameters. The Bitcoin Energy Consumption Index therefore proposes to turn the problem around, and approach energy consumption from an economic perspective.

The index is built on the premise that miner income and costs are related. Since electricity costs are a major component of the ongoing costs, it follows that the total electricity consumption of the Bitcoin network must be related to miner income as well. To put it simply, the higher mining revenues, the more energy-hungry machines can be supported. How the Bitcoin Energy Consumption Index uses miner income to arrive at an energy consumption estimate is explained in detail here, and summarized in the following infographic:

Note that one may reach different conclusions on applying different assumptions. The chosen assumptions have been chosen in such a way that they can be considered to be both intuitive and conservative, based on information of actual mining operations. In the end, the goal of the Index is not to produce a perfect estimate, but to produce an economically credible day-to-day estimate that is more accurate and robust than an estimate based on the efficiency of a selection of mining machines.

Over time, the Bitcoin Energy Consumption Index has been subject to a fair amount of criticism. Entrepreneur Marc Bevand, who argues that there are serious faults in the way the Bitcoin Energy Consumption Index is calculated, is often quoted in this regard. In his own market-based and technical analysis of Bitcoins electricity consumption Bevand argues that Bitcoins real energy consumption is much lower (~18 terawatt hours/year per January 11, 2018) than the number provided by the Bitcoin Energy Consumption Index. But this alternative approach, based on analysis of Bitcoins hashrate (computational power), is not without controversy either. Morgan Stanley accurately captured the main problems in this approach in their report Bitcoin ASIC production substantiates electricity use (January 3, 2018), explaining that the hash-rate methodology uses a fairly optimistic set of efficiency assumptions and may not allow enough for electricity consumption by cooling and networking gear. The impact of this can be significant, as becomes apparent from BitFury CEO Valery Vavilovs earlier comment that many data centers around the world have 30 to 40 percent of electricity costs going to cooling (40 to 65 percent relative to non-cooling electricity costs). Its thus not surprising that a hash-rate based approach produces a lower energy consumption estimate.

In the same report Morgan Stanley does argue that Bitcoins energy consumption must be at least 23 terawatt-hour per year (per January 3, 2018). Morgan Stanley finds this number based on Quartzs report of its tour of the Bitmain mining data center, equipped with the most recent 1387-based mining rigs, this past fall. At the time, this data center was drawing 40 megawatts per hour and represented 4% of the global Bitcoin network capacity (6M TH/s). Morgan Stanley continues by stating that the Bitcoin networks recent active hash rate has been ~15.2M TH/s, which implies total hourly Bitcoin electricity consumption is well more than 2700 megawatts/hour (23 terawatt hours/year). The company also notes that a realistic number is likely to be higher because the most efficient mining rigs used by Bitmain in its facilities are not yet widely available (the Bitcoin Energy Consumption Index was showing ~37 terawatt hours/year on the same day). For this reason, Morgan Stanley concludes that current use estimates are probably in the right general range.

Of course, the Bitcoin Energy Consumption Index is also very much a prediction model for future Bitcoin energy consumption (unlike hashrate-based estimates that have no predictive properties). The model predicts that miners will ultimately spend 60% of their revenues on electricity. At the moment (January 2018), miners are spending a lot less on electricity. On January 25, 2018, the Bitcoin Energy Index was estimating just 22% of miner revenues ($2.2B versus $10.4B) were actually spent on electricity costs. Based on this, the Energy Consumption Index would thus predict a possible energy consumption of around 130 terawatt hours/year (assuming stable revenues). This increase appears to be in line with expected miner production.

With regard to future energy consumption, Morgan Stanley estimates that Taiwan Semiconductor Manufacturing Company has Bitcoin ASIC orders for 15-20K wafer-starts per month for 1Q18. With each wafer capable of supplying chips for ~27-30 Bitcoin mining rigs, the total Bitcoin mining pool could see up to 5-7.5M new rigs added in the next 12 months if 1Q18 production rates are maintained through 2018. By the end of 2018, this means that the Bitcoin network could potentially draw more than 13,500 megawatts/hour (120 terawatt-hours/year), or even 16,000 megawatts/hour (140 terawatt-hours/year) based on 90% utilization and 60% direct electricity usage.

Altogether, it can be concluded that the relatively simple Bitcoin Energy Consumption Index model is supported by both emprical evidence from real-world mining facilities, as well as Bitcoin ASIC miner production forecasts.

The Bitcoin Energy Consumption Index is the first real-time estimate of the energy consumed by the Bitcoin network, but certainly not the first. A list of articles that have focussed on this subject in the past are featured below. These articles have served as an inspiration for the Energy Index, and may also serve as a validation of the estimated numbers.

If you find an article missing from this list please report it here, and it will be added as soon as possible.

Read more from the original source:

Bitcoin Energy Consumption Index – Digiconomist