Bitcoin news roundup, April 8, 2017

This week’s summary of various cryptocurrency news and developments:

New developments:

Some miners are allegedly engaging in unfair practices that can harm the network

Bitcoin Core developer and Blockstream CTO Greg Maxwell recently alleged through a bitcoin mailing list that a major mining hardware company has been exploiting a known weakness in bitcoin’s proof-of-work system, allowing the company to mine roughly 20% faster than its competitors. According to Maxwell:

• Reverse engineering of a mining ASIC from a major manufacture has revealed that it contains an undocumented, undisclosed ability to make use of this attack

According to CoinDesk, the “AsicBoost” technology was patented by its creators Timo Hanke and Sergio Demian Lerner back in 2014. It is believed the exploiting company is China-based Bitmain, a company that has a separate patent in China. Maxwell’s post inferred that Segregated Witness, a scaling solution proposed by the Bitcoin Core team, would kill the advantage AsicBoost is allegedly giving Bitmain.

Bitmain responded to the allegations by denying that the company has used AsicBoost on the bitcoin blockchain, even though it tested the technology on testnet. According to CryptoCoinsNews, Bitmain co-founder Jihan Wu said:

• Bitmain has only tested ASICboost on testnet and never used it on main net in production. We also believe that those who accuse us of using ASICBoost privately should provide direct evidence. ASICBoost is implemented, plus it is not used publicly, does not imply that it has been used in some very weird private ways.

Moreover, Jihan Wu added that Bitmain signed the Hong Kong agreement, in which almost all miners and some developers agreed to merge SegWit plus a 2MB hard fork, arguing that therefore the company could not be against SegWit.

Lightning network developer claims bitcoin core team runs trolling campaigns, as the scaling debate rages on

Joseph Poon, a Lightning Network developer, has stated on Reddit that Bitcoin Core has been organizing PR and trolling campaigns from a secret channel, and that it is somewhat known, as it’s alluded to in various publicly accessible places. The statement, according to CryptoCoinsNews, came after Blockstream employees accused Poon of going to the press, bypassing the development process. When asked to clarify and name the trolls, Poon stated he would not like to escalate the situation beyond his statement.

Following an extension blocks proposal made by Joseph Poon, Stephen Pair and Christopher Jeffrey, that Emn Gun Sirer, Cornell Professor said to be” technically very clever, and politically brilliant” on Forbes, tension has been developing between Bitcoin Core and Lighting Network developers and contributors. The proposal would both increase on-chain capacity and fix malleability, yet even though it gained a lot of support from some, others believe there are potential security risks in it, and argue it would take a year to test and deploy the solution.

Bitfinex to finish reimbursing customers for 2016 hack

In August 2016, bitcoin exchange Bitfinex was hacked and 119,756 bitcoins ($65 million at the time) were stolen. In order to reimburse customers, the exchange issued Bitfinex Tokens (BFX) that are now going to be purchased by Bitfinex with US dollars. This will mark the end of their existence, as there will then be no remaining tokens. According to the exchange, the step was taken in response to record results in March, and to reduce its reserves in light of the opportunity. The company also thanked its customers on the announcement:

• “We are tremendously grateful to all of our customers and new shareholders for helping us get to this point”

World Affairs:

Indian politician claims bitcoin should be declared illegal in the country

Last week, DeepDotWeb reported Indian politician Kirit Somaiya had labeled bitcoin a hypothetical currency, and questioned whether or not it was merely a pyramid scheme. The problem escalated, to the point a local exchange, Zebpay, had to restate the currency is legal in the country, and a petition was launched asking for the currency to become legal.

According to CCN, a local report that points to the formation of a committee that is to study the legality of the currency in the country has surfaced, and its findings should be out on April 20. Nevertheless, Kirit Somaiya urged the Indian parliament to ban bitcoin, even before drafting regulations. According to Kirit’s statements, bitcoin has been used in illegal schemes that have been growing without any restrictions

Over 260,000 Japanese retailers to start accepting bitcoin payments

Bitcoin has recently been recognized as a legal payment method in Japan and, according to RT, this means cooperation between major retailers and bitcoin exchanges will enable over 260,000 retailers across the country to accept bitcoin payments.

Recruit Lifestyle, a retail branch of Recruit Holdings, is cooperating with Coincheck to include bitcoin payments in their AirRegi application, that is used at over a quarter million stores in the country. Tokyo-based consumer electronics retail chain Bic Camera, on the other hand, has partnered bitFlyer, in order to conduct a trial run in which two of the group’s outlets will accept bitcoin payments up to 100,000 yen (roughly $900).

Financial:

Ripple hit a new all-time high

Ripple, the cryptocurrency that powers a business-focused distributed ledger created by San-Francisco based startup Ripple hit a new all-time high this week on April 2, as the currency’s value surged over 1,000%. It is not yet clear why Ripple’s value surged the way it did, although some believe bitcoin’s scaling debate and technological improvements in the Ripple Consensus Leger (the platform Ripple powers) might have something to do with it. According to CoinDesk, Ripple may have simply been the victim of “pump and dump” trading activity.

SegWit related confusion made litecoin’s price go down 20%

Litecoin’s price significantly increased in the past week, as the currency hit $12 per unit, mostly because it is expected to activate SegWit. This week, however, a confusing series of events made litecoin’s price go down by 20%.. First, litecoin’s creator Charlie Lee tweeted out that BW, a mining pool with roughly 8% of the network, wasn’t for SegWit. BW responded clarifying the decision had not yet been made. Later on, Wang Chun, co-owner and chief administrator of F2Pool, a pool with 35% of the network’s power, tweeted out he needed to “reconsider SegWit on LTC”. The market quickly reacted to these tweets. Nevertheless, Wang Chun seems to still be supporting SegWit.

I talked to Wang Chun and he will continue to signal for SegWit.

Everyone’s been under a lot of stress. So let’s all take a deep breath. https://t.co/LNftQtcRlg

— Charlie Lee (@SatoshiLite) April 6, 2017

 

At the time of press, litecoin was at $10.35, with a total market cap of over $500 million, according to CoinMarketCap. In the future, we might see Coinbase add litecoin to its platform:

(╯°□°）╯︵ ┻━┻

Yes, Litecoin will be added to Coinbase. https://t.co/SU4Wu9iMl3

— Charlie Lee (@SatoshiLite) April 8, 2017

Bitcoin at $1183.83, as market cap reaches $19 billion

Bitcoin is now a legal method of payment in Japan and even though the scaling debate rages on, the currency’s price is rising. It has reached $1200 in some exchanges, and according to data from CoinMarketCap one bitcoin is now worth $1183.83. Fears of a possible hard fork seem to be dissipating, as according to investors the price trend appears to show investors are confident in bitcoin.