Discussions of a possible US default have dominated the news cycle for the past few weeks. This is now the second time in as many years that debates over the debt ceiling have pushed the boundaries of the US government’s borrowing infrastructure. Having seen a similar scenario unfold in 2011, reactions from financial markets this time around may be foreseeable. Incidentally, this scenario may also provide a valuable opportunity to understand bitcoin’s developing role in the macroeconomic landscape. In Familiar Territory The current political disputes in Washington have led to a series of escalating outcomes. As the result of a …

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Silk Road, the online drug bazaar that has eluded authorities and been ingrained in the bitcoin narrative for years, was shut down yesterday. Ross Ulbricht was named in the court documents outlining Silk Road’s activities, as were a number of key data points that offer insights into the impact the world’s most infamous retail website has had on bitcoin. Ulbricht was caught as a result of human error and excessive risks related to physical delivery of false identification being delivered to his home address in San Francisco from Canada. After tracking the package, authorities found their way to Ulbricht and …

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An upgrade to Bitcoin-qt was released today and consists of several security and bug fixes bundled for release as version 0.8.4. It is recommended that all users upgrade immediately, since the release of these fixes makes finding the vulnerabilities in older code trivial. Included in this release are three security updates as well as several small bug fixes that were causing the application to crash or databases to become corrupted. Denial of Service Fix Bitcoin-qt 0.8.0 introduced Bloom Filters which allow for more flexibility with respect to how much of the block chain must be downloaded. Bloom Filters are a …

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Bitcoin’s growth in 2013 has accelerated tremendously, driven largely by economic concerns which bitcoin is uniquely positioned to solve. This has been evidenced so far this year by conditions in Cyprus, China and Argentina, and has highlighted bitcoin’s potential in less developed nations like Kenya as well. All of the countries listed above are known for high inflation rates, strict capital controls, or a combination of both – a scenario that is beginning to unfold in India. This analysis will address India’s current economic climate and the factors that would affect the population’s propensity to adopt bitcoin on a large …

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Seattle-based law firm Riddell Williams just signed two of the bitcoin community’s most prolific legal voices to chair their payments division. While the firm boasts a 100+ year history and more than 60 attorneys on staff, the decision to bring on Ryan Straus and Daniel Friedberg to lead the group makes a strong statement about the firm’s view on the future of financial law. Friedberg has published a number of pieces related to bitcoin regulation, including guest writing for the Bitcoin Foundation. He’s often quoted as a bitcoin legal reference by major news outlets, including recent appearances in Business Insider, Tech Cocktail, …

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As the digital currency markets continue to mature and build trade history, we can learn more about market reactions, patterns and influences. Often cited as the digital version of gold – a finite, non-state wealth store – bitcoin may be joined in the world of nouveau analogies by litecoin, which has already become commonly referenced as digital silver. Litecoin (LTC) is nearly identical to bitcoin with a few notable exceptions. Litecoin uses a different proof-of-work algorithm chosen specifically to make mining possible with consumer-grade hardware. Additionally, the LTC protocol targets 2.5 minutes average block times (compared to 10 for BTC) …

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Considering a bitcoin mining hardware purchase? Make a more informed decision with our Bitcoin Mining Dashboard. As TGB forecast back in May, the first shipments of Avalon’s ASIC chips have started arriving. Images were posted on BTCMan.com and the bitcointalk.org forums showing large quantities of chips arriving at a warehouse. The photographs were release by Fujian Yan Tan, a retailer of Avalon ASIC boards, who plans to resell the ASIC chips after mounting them in the boards. Low estimates for Avalon’s total shipped mining speed range from 105 TH/s to almost 1,000 TH/s. Low Estimates Are 105 TH/s, Likely Much Higher Although slightly …

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It is no secret that bitcoin usability has room for improvement. Fortunately, a new feature planned for the bitcoin v0.9 release will significantly increase merchant and customer usability in four key areas: ease of payment, recurring payments, dispute resolution, and immediate-feedback transactions. The key improvement is a new type of payment messages where a merchant can send a signed request (PaymentRequest) specifying the amount to be paid and a description of the transaction. The customer can then send payment to the merchant and receive an acknowledgement (PaymentACK) of the transaction with a message from the merchant. Before discussing the advantages …

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At a conference held last week in DC, the European Central Bank presented their opinion of virtual currencies including discussions about bitcoin. On slide 6 of their presentation they made a striking argument: bitcoin does not fulfill any of the three functions of money: Medium of Exchange, Unit of Account, or Store of Value. Most likely, their counterpoints to these three functions relate to the large volatility that bitcoin’s exchange rate has experienced since it’s inception. While it is difficult to refute their exact points since the soundtrack is not included, it does raise an interesting question of how the …

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As we witness bitcoin’s continued growth around the world, one locale stands out as particularly primed for widespread adoption: Kenya. Africa today has one of the fastest growing mobile phone markets in the world with 20% annual growth and 93% of Kenyan households owning mobile phones. What makes Kenya a particularly unique case for bitcoin is that it is also a world leader in mobile payment usage. In 2007, Safaricom, one of Kenya’s leading telecommunications companies, launched a mobile payment service called M-PESA. Today, two thirds of Kenyans use the service and more than 30% of Kenya’s GDP flows through …

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