Showing posts with label bitcoin. Show all posts
Showing posts with label bitcoin. Show all posts
Friday, December 21, 2018
Tuesday, October 10, 2017
Monday, August 21, 2017
Friday, January 6, 2017
Why #bitcoin just had an amazing year
When surprises happen, people buy bitcoin.
When Greece threatened to leave the European Union in 2015, investors surged into the digital currency. The same thing happened when Britain voted to leave the European Union last year, and when Donald Trump defied polls to win the U.S. presidential election. Recent economic surprises in China, India and Venezuela that threatened to destabilize those countries’ paper currencies sparked an interest in the digital alternative as well.
That’s why Chris Burniske, an analyst at ARK Investment Management, a firm that invests in disruptive innovations, has termed bitcoin a “disaster hedge.”
“People are using it similar to how they use gold,” he says. “They use it as a risk-off trade when they’re concerned about what’s going on in the capital markets.”
Last year held plenty such surprises for investors, and they collectively helped make bitcoin the best-performing currency of 2016, analysts say. The currency’s value more than doubled in 2016 to reach $1,029 on Tuesday, a three-year high, as data from CoinDesk, a bitcoin-tracking website, shows.
Bitcoin was created in 2008 by an unidentified programmer known as Satoshi Nakamoto. It is the world’s first completely decentralized currency — unlike with the dollar, euro or yen, there is no central bank that controls the amount of bitcoin in circulation or its value. Instead, that is controlled by a global peer-to-peer network of computers.
People provide their computing power to the network to log transactions, which are recorded in a ledger that is publicly distributed across the network, called the block chain. New bitcoins are created as the computers in the network solve complex math problems that verify transactions in the block chain, a process known as mining.
Because bitcoin is decentralized, it can be used anonymously — a feature that has made the virtual currency the payment system of choice for those seeking to evade taxes, launder money, fund hacking attacks or engage in other illicit behavior. The currency also acquired a reputation for instability, due in part to hacking attacks on virtual exchanges that provoked wild swings in its value in past years.
But in the past few years, bitcoin has become more mainstream, attracting the interest of hedge funds, brokerages and other institutional investors, especially as risks for traditional currencies increase.
“All this instability is sort of bringing alternative methods to the forefront,” said Ryan Rabaglia, a trader at Octagon Strategy, a commodity and digital asset trading firm in Hong Kong.
Some analysts believe that rising interest rates and continued economic uncertainty could push the currency’s value even higher in the next year. The price may surpass an all-time high of $1,216.70 reached in 2013, CoinDesk predicts.
Traders say one major force pushing up the value of bitcoin is surging demand from China, where people are using the digital currency to circumvent tight restrictions on moving money out of the country. More than 95 percent of the global trading volume in bitcoin takes place on Chinese exchanges, and most of that is what’s known as capital flight, Burniske says.
China’s economy has slowed in recent years, and its real estate and stock markets have at times fluctuated violently. As a result of these forces, and the expectation that China’s currency may lose value in the future, Chinese companies and investors have been eager to diversify their portfolios by moving their money into what they perceive as safer assets abroad.
This has led to a massive outflow of cash from China. Chinese investment in the United States nearly tripled in 2016 compared with the year before, according to tracking by research firm Rhodium Group. In total, some $762 billion exited China in the first 11 months of the year, according to Bloomberg Intelligence.
Some of this money left China legally, and some did not. The Chinese government has been wary of too much money moving offshore, because that might destabilize the country’s currency and economy. So it has imposed tighter restrictions on individual citizens, who can move only $50,000 abroad each annually, and limited some channels for moving money abroad, like purchasing insurance or real estate.
But Chinese people have found ways to get around these restrictions, moving money out of the country through channels like illicit import-export companies, gambling dens and alternative currencies like bitcoin.
“The desire to diversify their portfolios and get around the constraints imposed by the authorities may certainly have sparked additional demand for bitcoin,” says Eswar Prasad, a fellow at the Brookings Institution and the author of “Gaining Currency: The Rise of the Renminbi.”
Burniske agrees that China has recently been the largest driver in the value of bitcoin. He points to the chart below, which shows that the rise in the value of bitcoin is closely associated with the drop in the value of China's currency, which is known as the renminbi or yuan.
(Chris Burniske, ARK Investment Management)
Rabaglia says efforts to limit the exchange of currency in Venezuela, which is in the midst of an economic meltdown, and in India, which is undergoing a massive campaign to stamp out black money, have also caused bitcoin’s value to surge.
“The availability and the ease of transit of this currency makes it an attractive play for [people in] all these countries that are having these controls put on them,” Rabaglia says.
Burniske is quick to point out that bitcoin has a roughly $16 billion market capitalization, which is still small compared with the amount of money flowing out of China, for example.
But he expects the market for bitcoin to continue to grow, due in part to fundamental improvements in how the currency works. In 2016, programmers released an update that significantly expanded the functionality of the currency’s network, lowering the transaction costs for people to use bitcoin.
Washingtonpost.com
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Thursday, August 18, 2016
'Auction' of NSA Tools Sends #Security Companies Scrambling
The leak of what purports to be a National Security Agency hacking tool kit has set the information security world atwitter — and sent major companies rushing to update their defenses.
Experts across the world are still examining what amount to electronic lock picks. Here's what they've found so far.
WHAT'S IN THE RELEASE?
The tool kit consists of a suite of malicious software intended to tamper with firewalls, the electronic defenses protecting computer networks. The rogue programs appear to date back to 2013 and have whimsical names like EXTRABACON or POLARSNEEZE. Three of them — JETPLOW, FEEDTROUGH and BANANAGLEE — have previously appeared in an NSA compendium of top secret cyber surveillance tools .
The auctioneers claim the tools were stolen from the Equation Group, the name given to a powerful collective of hackers exposed by antivirus firm Kaspersky Lab in 2015. Others have linked the Equation Group to the NSA's hacking arm, although such claims are extraordinarily hard to settle with any certainty.
The leaked tools "share a strong connection" with the Equation Group, Kaspersky said in a blog post late Tuesday. The Moscow-based company said the two used "functionally identical" encryption techniques.
The leaked tools also appear to be powerful, according to a running analysis maintained by Richmond, Virginia-headquartered Risk Based Security. The group said several of the vulnerabilities targeted by the malware — including one affecting Cisco firewalls — were previously unknown, a sign of a sophisticated actor.
Security and networking companies scrambled to investigate the flaws exposed by the auction. Cisco Systems, Inc. issued an urgent update to its software late Wednesday. Fortinet, Inc., a Sunnyvale, California-based security company, also said it was investigating.
Nicholas Weaver, a researcher at the International Computer Science Institute in Berkeley, California, said that the news was terrible for the NSA no matter the circumstances behind the leak because companies like Cisco guard critical U.S. infrastructure.
"If the NSA discovered breach in 2013 and never told Cisco/Fortinet, this is VERY BAD," he said in a message posted to Twitter . "If they didn't know, this is VERY BAD."
The NSA has not returned repeated messages seeking comment.
WHO IS BEHIND THE LEAK?
The documents have been leaked as part of a surreal online auction by a group calling itself "Shadow Brokers." Their madcap, Borat-like manifesto rails against the "Wealthy Elite" and the group's name appears to be a nod to the "Mass Effect" series of video games, where an elusive Shadow Broker traffics in sensitive information.
Few take the name or the manifesto at face value. Many have floated the possibility of Russian involvement, a theory that received unexpected support when NSA leaker Edward Snowden endorsed it on Twitter.
In a series of messages , Snowden wondered aloud whether the server the data was stolen from might be linked to a U.S. attempt to influence a foreign election. That would be a politically charged development in the context of recent allegations that Russia is trying to tamper with America's presidential campaign.
The leak looks like a warning that any attempt to point the finger at Moscow over alleged electoral interference "could get messy fast," Snowden tweeted. He did not return messages seeking further comment.
Comae Technologies founder Matt Suiche said the theory of a disgruntled insider couldn't be ruled out.
In a blog post , Suiche said he'd been contacted by a former NSA hacker who pointed out that the tools leaked online normally resided on a segregated network and that the way they were named suggests the data was copied direct from the source. Suiche cautioned it was just a theory.
"We'll never know," he said in a message to AP.
Repeated emails and online messages seeking comment from the Shadow Brokers went unreturned.
HOW DOES THE AUCTION WORK?
Shadow Brokers have already published much of the data they claim to have. The rest — "the best files" — will be released, they claim, to whoever wins the auction.
The content of the files is secret, the group said in its announcement. So too is the length of the auction, which it said would end, in its signature broken English, "when we feel is time to end."
Many dismiss the auction as a stunt.
Hopeful bidders have been invited to send bitcoins — the borderless electronic currency — but as of late Wednesday the address specified by the group had only gathered 1.72 bitcoins, or $981.
It's more than pocket change. But the group's stated goal is 1,000,000 bitcoins, or $570 million.
Nytimes.com
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Tuesday, June 21, 2016
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