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Bitcoin compliance startup Chainalysis discusses its new partnership with UK bank Barclays and its potential impact on the ecosystem.

Payments startup Square just filed to go public.

In Jack Dorsey's founders' letter, he says that the company's goal since the beginning has been to make the entire payments ecosystem "faster, more affordable, and more accessible."

"We’ve built one of the fairest and most efficient payments businesses in the world," he says. 

Dorsey also revealed that over the past two years he's given over 20% of his own equity back to Square, and a new organization called the "Start Small Foundation," which will invest in artists and small businesses in underserved communities around the world. 

He also committed to giving an additional 40 million shares to this cause now.  

Here's the full note:

We started Square because Jim McKelvey, our co-founder and my second boss (after my mother!), couldn’t accept a credit card for his art.

Setting up a merchant account was painful. The application process required lots of paperwork and took months. Banks asked for multiple credit checks and years of financial history. And when we were finally approved to accept cards, we couldn’t decipher the rates we were paying. Then our first deposit was held. The entire process was exclusionary and unfair.

Square was born out of our experience. We built a working prototype: a mobile credit card reader that plugged into the audio jack of an iPhone and an app to enter an amount and process the payment. But it took us a year to convince the financial industry to allow us to make Square broadly available. The problem was not with the technology, but with the system.

We decided to make the entire system faster, more affordable, and more accessible. We gave the card reader and software away for free. We settled funds next business morning, which required us to advance money to sellers faster than we received it. We abstracted away the byzantine maze of interchange pricing to offer a simple fixed rate per swipe, which forced us to find ways to lower our costs immediately. Every one of those decisions carried existential risks that we trusted we’d be able to overcome with time. And we have!

Creating more inclusion and greater equality in the global economy is both a social need and a huge business opportunity. We’ve made it our purpose: empower people with beautifully simple tools that give them an advantage where they previously and unfairly had none. Our strategy to realize that purpose is straightforward: grow our payments service, extend payments into financial services, and extend payments into marketing services.

We’ve built one of the fairest and most efficient payments businesses in the world. We made it possible to accept card payments in less than five minutes. We priced all payment cards at the same flat rate and eliminated complicated fees. With Square Cash we’ve built a network that works for both individuals and businesses, online and offline. We believe sellers should be able to accept any type of payment, from cash to cards, Apple Pay to bitcoin, and whatever the future may bring, so they never miss a sale.

The strength of this business is more than the money it generates. The collective power of our millions of sellers sustains a scale from which we can build valuable financial services and marketing services, creating reinforcing and virtuous cycles back to our core business of payments. We’ve made getting capital as easy as tapping a button. We replaced pen and paper accounting with real-time insights into sales patterns and customer trends. Everything works together seamlessly to help our sellers make smart decisions for their businesses. When they succeed, we succeed.

By making our services accessible to everyone, we can build a more fair and productive system that serves instead of rules. This is both good for Square and the right thing to do. We’re off to a strong start.

As a public company our decisions will continue to reflect what we’ve done as a private one—we put our customers first. That means constantly asking the question: how can the financial system better serve people? We’ll measure ourselves by our commitment to take the long view and focus on building a company that creates value over decades and not just a few fiscal quarters out.

Here's the part about Dorsey's equity:

I believe so much in the potential of this company to drive positive impact in my lifetime that over the past two years I have given over 15 million shares, or 20% of my own equity, back to both Square and the Start Small Foundation, a new organization I created to meaningfully invest in the folks who inspire us: artists, musicians, and local businesses, with a special focus on underserved communities around the world. The shares being made available for the directed share program in this offering are being sold by the Start Small Foundation, giving Square customers the ability to buy equity to support the Foundation. I have also committed to give 40 million more of my shares, an additional 10% of the company, to invest in this cause. I’d rather have a smaller part of something big than a bigger part of something small.

We intend to make this big! Thank you for your support and potential investment in Square.

SEE ALSO: Meet the 9 most important Square executives, other than CEO Jack Dorsey

Join the conversation about this story »

NOW WATCH: Ashley Madison hack reveals the states where people cheat the most

Gravatar is an avatar platform that works across the internet and integrates with popular sites inclusing WordPress, Disqus, GitHub, and Stack Overflow. Gravatar serves over 8 billion images every day for millions of users.

Bitcoin Magazine recently learned that the company silently released a new feature, allowing users to add bitcoin wallets to their Gravatar accounts.

An avatar is an image that is often used to represent you as a person on the Internet. It usually appears as a little picture, right next to your name whenever you interact with various websites. Gravatar, instead, is a globally recognized avatar, which means that you create it once, and it will then proceed to appear on any Gravatar-enabled websites. Once you upload or create your avatar, the little image will follow you around.

In a recent post, Gravatar announced it has introduced a feature which allows users to add their bitcoin, litecoin or dogecoin addresses. Users will be easily able to purchase goods and services from different supported platforms such as WordPress.com, but also to tip people online for making witty comments, or for helping others. Until now, tipping such users was difficult, as those who wanted to tip had to contact the person and ask for a payment method.

Now, things have gotten much easier. Tippers can easily access profiles, and look for the bitcoin or altcoin addresses, which can then be used to send and receive digital currencies. By associating the address with your account, not only will you be able to make faster payments, but you’ll also give others the possibility to learn more about your preferred payment methods and their associated addresses.

The new feature is now available for all Gravatar users. For more information, refer to the Gravatar FAQ about digital currencies .

The post Gravatar Adds Bitcoin Support for User Accounts appeared first on Bitcoin Magazine.

Gravatar is an avatar platform that works across the internet and integrates with popular sites inclusing WordPress, Disqus, GitHub, and Stack Overflow. Gravatar serves over 8 billion images every day for millions of users.

Bitcoin Magazine recently learned that the company silently released a new feature, allowing users to add bitcoin wallets to their Gravatar accounts.

An avatar is an image that is often used to represent you as a person on the Internet. It usually appears as a little picture, right next to your name whenever you interact with various websites. Gravatar, instead, is a globally recognized avatar, which means that you create it once, and it will then proceed to appear on any Gravatar-enabled websites. Once you upload or create your avatar, the little image will follow you around.

In a recent post, Gravatar announced it has introduced a feature which allows users to add their bitcoin, litecoin or dogecoin addresses. Users will be easily able to purchase goods and services from different supported platforms such as WordPress.com, but also to tip people online for making witty comments, or for helping others. Until now, tipping such users was difficult, as those who wanted to tip had to contact the person and ask for a payment method.

Now, things have gotten much easier. Tippers can easily access profiles, and look for the bitcoin or altcoin addresses, which can then be used to send and receive digital currencies. By associating the address with your account, not only will you be able to make faster payments, but you’ll also give others the possibility to learn more about your preferred payment methods and their associated addresses.

The new feature is now available for all Gravatar users. For more information, refer to the Gravatar FAQ about digital currencies .

The post Gravatar Adds Bitcoin Support for User Accounts appeared first on Bitcoin Magazine.

Gravatar is an avatar platform that works across the internet and integrates with popular sites inclusing WordPress, Disqus, GitHub, and Stack Overflow. Gravatar serves over 8 billion images every day for millions of users.

Bitcoin Magazine recently learned that the company silently released a new feature, allowing users to add bitcoin wallets to their Gravatar accounts.

An avatar is an image that is often used to represent you as a person on the Internet. It usually appears as a little picture, right next to your name whenever you interact with various websites. Gravatar, instead, is a globally recognized avatar, which means that you create it once, and it will then proceed to appear on any Gravatar-enabled websites. Once you upload or create your avatar, the little image will follow you around.

In a recent post, Gravatar announced it has introduced a feature which allows users to add their bitcoin, litecoin or dogecoin addresses. Users will be easily able to purchase goods and services from different supported platforms such as WordPress.com, but also to tip people online for making witty comments, or for helping others. Until now, tipping such users was difficult, as those who wanted to tip had to contact the person and ask for a payment method.

Now, things have gotten much easier. Tippers can easily access profiles, and look for the bitcoin or altcoin addresses, which can then be used to send and receive digital currencies. By associating the address with your account, not only will you be able to make faster payments, but you’ll also give others the possibility to learn more about your preferred payment methods and their associated addresses.

The new feature is now available for all Gravatar users. For more information, refer to the Gravatar FAQ about digital currencies .

The post Gravatar Adds Bitcoin Support for User Accounts appeared first on Bitcoin Magazine.

Since the dawn of networked gaming, providers have looked for ways to keep the money spigot flowing. Games like World of Warcraft have subscription models, where users pay them every month for access to the online world. Other games like SecondLife have seen extensive use, making Linden Dollars one of the first native “digital currencies.” Also, WoW and Runescape players have long found ways to sell their gold, without regard to game policies on such practices. Subscription models won't work for everyone, however, in that gamers only have so much of both money and time. If every game were to […]

The post Bitcoin Could Help With Destiny's Microtransactions appeared first on CCN: Financial Bitcoin & Cryptocurrency News.

Uphold, formerly Bitreserve and the world’s leading cloud-based money platform, has announced a complete rebrand and the launch of new functionalities, products and services to key markets across Europe , the US, China and beyond. Businesses and consumers can now fund their Uphold accounts via bank transfer or by linking a credit/debit card in addition to bitcoin.

By Freya Berry and Martinne Geller

LONDON (Reuters) - Will a beer colossus by any other name taste as sweet?

For the executives preparing a merger worth over $100 billion, a not inconsiderable question is what to call a company that will brew almost one in three of the world's pints.

The current names of the firms, Anheuser-Busch InBev and SABMiller , are the acronym-heavy result of years of dealmaking. While neither trips off the tongue, each resonates with its thousands of employees and, to a lesser extent, millions of consumers.

A new name isn't just a marketing exercise - it's about both recognizing the history and setting the future direction of the freshly-combined companies, industry experts said.

"A sure fire way to create friction among a newly unified employee population is to tip your hat to one of their businesses and heritage but not the other," said Mark Skoultchi, Partner at U.S. naming consultancy Catchword.

In this case, paying homage to any of the predecessors - Anheuser-Busch, AmBev, Interbrew, South African Breweries and Miller Brewing - is bound to be a mouthful.

Drinks industry sources suggested names to Reuters including SAB InBev, ABSAB, Globev, SABI and Omnibrew, while analysts labeled the combination MegaBrew throughout the nearly month-long courtship.

Catchword has opened up a forum on Popnamer.com for suggestions. Contributions so far range from the wacky - MegaKega, Beerhemouth - to the finance in-jokes - Hopportunity, M&(IP)A.

Sadly, corporations are generally less in thrall to puns and more subject to rather more prosaic considerations, especially in the consumer sector where brand recognition is key.

Those include the direction the firm aims to grow in, how to distinguish itself from rivals, whether it is compelling from a marketing perspective, and the ability to trademark.

That's not to say a complete revamp can't be done.

"Now might be the time to go to something totally different, which is not related," said naming consultant Benedicte Windle of It's Raining Names. "There are a lot of issues that are overcome by having a completely new name that nobody associates with any power struggle."

The consumer sector has a track record of complete rebranding, with varying success.

The 1997 merger of Guinness with Grand Metropolitan resulted in a company now called Diageo , thought up by branding firm Wolff Olins to communicate the idea of "everyday pleasure everywhere".

And when Kraft split off its snack foods business in 2011, it held a company contest the following year to find a new name. The winner was Mondelez - "pronounced mohn-dah-LEEZ", it clarified in its announcement - from a combination of "monde" ("world" in French) and "deliz" (delicious).

But you can't please everyone. "Catchy name - NOT," said one commenter on USA Today at the time.

The snappy new acronym EY chosen by management consultant Ernst & Young also happened to be the title of a Spanish gay interest magazine, with colorful photos online to match.

"It will be apparent to individuals looking for EY, the professional services organization, that the images are not related to us," a spokeswoman told Gay Star News in 2013.

While it will doubtless seek to avoid such coincidences, AB InBev's reputation as a cost-cutting machine means an expensive revamp may be unlikely.

"They're not going to have an army of consultants doing this for them," said a banker, noting also that if the combined company exits the U.S. MillerCoors joint venture, as expected, it could drop the Miller name.

ABInbev said it was too early to speculate on possible names.

At the end of the day, it might all come down to how creative each side is ready to get.

"Given recent history - Interbrew, InBev, AB-InBev – I think it would be fair to assume they won't spend long on this," said a source close to one of the companies, referring to AB InBev's earlier iterations from previous deals. 

"But then again, SABMiller was simply the project name the banks gave to the combination of Miller Brewing Company and South African Breweries. So I don't think there is much creativity on either side."

(Editing by Philippa Fletcher)

Join the conversation about this story »

 The company formerly known as Bitreserve is moving beyond its Bitcoin roots to become a full-service provider of financial transactions under the new moniker Uphold. Read More

Earlier this year, Joseph Poon and Thaddeus Dryja released the Lightning Network white paper. In it they theorize how a layer on top of the Bitcoin blockchain can allow for instant and cheap bitcoin transactions, while vastly improving its scalability.

As a result of the block-size limit debate, the Lightning Network has been getting a lot of attention lately. But, unfortunately, wild myths have started to dominate the discourse. Suddenly thrown in the middle of a long-lasting conflict of visions, Poon and Dryja's concept is hailed both as the great savior solving all of Bitcoin's problems – and as a source of deep corruption within Bitcoin's development community.

This article will not seek to explain how the Lightning Network is set to function on a technical level. Such explanations can be found here and here , and for those who really want to immerse themselves with all of the nitty-gritty details of how it all works, here.

Rather, this article addresses 11 common myths surrounding the Lightning Network, in hopes of putting these to bed for good.

Myth #1: Core developers are crippling Bitcoin to force users onto the Lightning Network.

Although Poon and Dryja, along with several others, are currently realizing their own Lightning Network-based startup, Blockstream has been the only company funding the development of the Lightning Network so far. Specifically, the Bitcoin business with a $21 million seed round under its belt empoyed Paul “Rusty” Russel to work on an implementation of the concept.

Meanwhile, some of Bitcoin’s most prominent developers -- such as Gregory Maxwell and Pieter Wuille -- are on Blockstream’s payroll, too. This has led some to believe that Blockstream is working nefariously. It’s been alleged that the company is blocking any increase of Bitcoin’s block-size limit, as this will drive up transaction fees, forcing bitcoiners to use the Lightning Network instead.

This logic, however, seems very farfetched at best.

First, it's not just Blockstream employees who prefer to keep blocks small. The “ decentralist ” side of the debate includes a diverse group of programmers and other bitcoiners, including Bitcoin Core lead developer Wladimir van der Laan, Bitcoin Core developer Peter Todd, digital currency veteran Nick Szabo, former Bitcoin Foundation director Jon Matonis, bitcointalk.org and r/bitcoin admin “ theymos,” and plenty of others.

Second, some of the most prominent Blockstream employees and Core developers opposing a block-size increase – most notably Maxwell and Wuille – were skeptical of raising this limit long before Blockstream was even founded, and long before the Lightning Network white paper was published. Both were, in fact, some of the first block-size conservatives, back when the controversy first arose early in 2013.

Third, even if transaction fees on the Bitcoin network do rise, that doesn't really “force” people onto the Lightning Network at all. It will always be possible to use the Bitcoin blockchain directly if one so wishes – it will just cost more. If anything, users might be incentivized to use the Lightning Network, which is categorically different from being forced to do so. And even that is debatable, as there are plenty of alternative solutions with which to transfer money.

But fourth, and most importantly, the case for smaller blocks is simply much more reasonable than the “force-bitcoiners-to-use-Lightning” argument would have you believe. The question of how to scale Bitcoin has been an issue since the early days, and almost all developers agree that oversized blocks pose a security risk. While it is debatable what block size is too big (and the decentralists might be off the mark on this one) it is hard to deny that the Lightning Network can solve real, existing problems in regard of scalability – not to mention cost and speed.

Myth #2: There is no conflict of interest for the Core developers employed by Blockstream.

On the other end of the spectrum, some developers employed by Blockstream and working on Bitcoin Core have claimed that their involvement in both projects are wholly separate and does not represent any sort of a conflict of interest.

This, however, is not true either, and claiming otherwise might be the result of a confusion of terminology.

According to Wikipedia:

“A conflict of interest (COI) is a situation in which a person or organization is involved in multiple interests, financial interest, or otherwise, one of which could possibly corrupt the motivation of the individual or organization.”

(Other sources cite similar definitions.)

In this context, the word “possibly” is key. The Core developers working for Blockstream do not actually need to be influenced by the company when they work on Bitcoin for there to be a conflict of interest. The simple fact that they potentially could be, is reason enough. Even if Maxwell, Wuille and others are all perfectly capable of separating their two occupations, and they work as honestly and properly as humanly possible for both Blockstream as well as Bitcoin Core, their involvement in both is still a conflict of interest.

It should be noted, however, that absent an independent and sustainable funding model for Bitcoin developers, there might always be conflicts of interest within the development community. Whether that poses a problem, and how big that problem is, is up for debate. But no one has presented a clear-cut and workable solution for this problem yet.

Myth #3: The Lightning Network will be controlled by Blockstream

It is sometimes suggested that Blockstream will effectively control the Lightning Network, and, as such, will be able to determine how people use it, and what for.

There is some truth to this argument. If Blockstream deploys a fully functioning Lightning Network, they will technically control the code base.

However, the Lightning Network is an open-source project. And, as opposed to Bitcoin itself, it's not even an open-source project that requires consensus among all Bitcoin users over the protocol rules. This means that anyone can fork the Lightning Network any time they want, potentially adjust the code in any way they want, and deploy their own version whenever they want. It might even be possible for users of different types of Lightning Networks to transact with each other, as long as there are nodes connecting the two.

Indeed, competing implementations of the Lightning Network, such as Amiko Pay, are being worked on already, while Poon, Dryja and others are setting up a company to realize their own implementation. Moreover, two Lightning Network-type solutions, the Thunder Network and Stroem, have been deployed already.

Myth #4: The Lightning Network requires large payment hubs that will control the network.

Some argue that the Lightning Network will impede some of Bitcoin's most valuable properties, such as decentralization and censorship resistance. According to this argument, the Lightning Network requires large hubs to route most of the payments through. These could then block certain transactions, such as donations to WikiLeaks or other political dissidents.

This argument is largely based on the assessment that the most efficient network configuration – the configuration that requires the least amount of hops from any node to any other node – is a hub-and-spoke model. As such, the Lightning Network might naturally evolve to resemble a hub-and-spoke model, too. Hubs in this network could very well be big Bitcoin entities that almost everyone uses in some way or another already, like exchanges, wallet services and payment processors.

Importantly however, and much like Bitcoin itself, anyone on the Lightning Network can open a payment channel with anyone else at any time. Therefore, if Lightning hubs do emerge, they cannot control the network. Even if all existing hubs refuse to open a channel with WikiLeaks, anyone else still can, hence routing around these hubs. In fact, WikiLeaks could opt to become a hub itself.

Myth #5: Lightning hubs will infringe on users’ privacy.

While it is simply impossible for potential hubs on the Lightning Network to control the flow of funds, a slightly more accurate criticism of the system is that these hubs might be able to keep track of payments on the network. Since most of the transactions will route through these hubs, they could observe the flow of funds, impeding on users' privacy.

This could be true. However, all transactions on the Bitcoin network are currently publicly available and traceable by anyone already. On the Lightning Network, on the other hand, many transactions will be seen only by the hub operators. As such, the Lightning Network by default offers more privacy than the Bitcoin network currently does, not less.

Moreover, recent advancements on the Lightning protocol suggest that it should be possible to route transactions on the Lightning Network in a similar way as messages over the Tor network are. This would entail that all nodes on the Lightning Network know only from which directly connected node a transaction came – and to which directly connected node it must be sent. But they would not know which node initiated the transaction, nor at which node it will end up. If this is worked out properly, the Lightning Network could offer far more privacy than the Bitcoin network currently does.

Myth #6: Blockstream will earn fees off of the Lightning Network.

It is sometimes argued that Blockstream is merely, or at least mainly, pushing the Lightning Network (and blocking an increase of the block-size limit) because it plans to earn fees by running a Lightning Network hub.

It's not unlikely that Lightning hubs will indeed charge a fee for their service as a middleman. And since anyone can set up a hub, it's possible that Blockstream might want to do so, too.

But since anyone can set up a hub and earn fees by doing so, it is unlikely that anyone will make a huge profit. In a free market, competition should keep prices competitive, minimizing profit for anyone involved.

In reality, there is very little reason to believe Blockstream aspires to be in the business of being a financial intermediary. So far, nothing indicates that they will want to, nor will they be particularly well positioned to be one.

Myth #7: Blockstream won't make any money off the Lightning Network.

Since Blockstream won't really be able to control the Lightning Network, nor seems likely to make a lot of money by charging fees as a Lightning hub, this begs the question why the company funds its development in the first place.

To answer that question, it should first be noted that Blockstream is by no means pouring huge amounts of capital into the Lightning Network. The company is paying one salary, that of Rusty Russell, and that's it. While we can probably assume that Rusty is doing well, the Lightning Network is by no means a multi-million dollar operation.

Still, that leaves the question why Blockstream is funding Lightning Network development at all.

The most likely answer is that Blockstream is not completely sure either. As far as an explanation from the company goes, it believes that its in-house expertise will somehow be worth money eventually. In a world where millions or even billions use the Lightning Network, Blockstream assumes a profit can be made somehow, for instance through support, training and consulting services.

A comparison has been made to Red Hat. Red Hat, an American multinational software company, has a similar business model for other open-source projects, most notably the Linux operating system. The company provides all sorts of Linux-related services to a host of different clients all across the world. And with an annual revenue of more than $1 billion, Red Hat has been doing quite well indeed – probably much better than any Lightning hub ever will.

Myth #8: The Lightning Network requires a controversial hard fork of the Bitcoin network.

Another argument against the Lightning Network is that it's far from certain that it can be implemented. Much like a block-size limit increase, it is said that enabling the Lightning Network will require controversial changes to the Bitcoin protocol, and perhaps even a hard fork.

The Bitcoin network will indeed require several updates in order to support the Lightning Network. These are, most notably, a solution to the malleability issue (perhaps BIP 62) and the option to lock transactions until some future point in time (BIP 65). Neither of these adjustments, however, require a hard fork. Instead, they can be soft forked into the protocol, and none of these soft forks seem to be controversial on a technical level.

(Of course, similar changes can be implemented through a hard fork, too, if that were to be preferred. But it would not be necessary.)

Myth #9: Because of the Lightning Network, the block-size limit will not need to be raised.

The Lightning Network is set to enable a virtually unlimited amount of transactions between two connected users, while only recording two transactions on the actual Bitcoin blockchain. As such, the Lightning Network is sometimes hailed – either implicitly or explicitly – as the savior of Bitcoin that will solve all scalability issues.

While the Lightning Network could, indeed, potentially help solve the scaling problem to a large extent, it is quite an exaggeration to claim that no further block-size increase will be needed at all. If Bitcoin does grow to its full potential, and the Lightning Network is used by billions around the globe on a daily basis, these users will still need to transact on the Bitcoin blockchain in order to open and close channels once in a while. If that happens, it’s safe to assume that 1 megabyte blocks will be too limiting.

In fact, Poon and Dryja acknowledge that the block-size limit would need to be raised in their white paper, estimating:

“If we presume that a decentralized payment network exists and one person will make 3 blockchain transactions per year on average, Bitcoin will be able to support over 35 million users with 1MB blocks in ideal circumstances (assuming 2000 transactions per MB). This is quite limited, and an increase of the block size may be necessary to support everyone in the world using Bitcoin.... While it may appear as though this system will mitigate the block size increases in the short term, if it achieves global scale, it will necessitate a block size increase in the long term.”

It should also be noted that the Lightning Network is not merely intended as a solution for scalability. It could also securely enable instant confirmations for the first time, and make microtransactions worth fractions of a cent economically feasible again. In fact, if these properties draw in a lot of new Bitcoin users, deployment of the Lightning Network might actually pose a challenge for Bitcoin’s scalability issue on the shorter term.

Myth #10: The Lightning Network is an easy fix.

While debating the block-size issue, some on the decentralist side contend that the Lightning Network will simply solve most of Bitcoin's scalability problems. This sometimes makes the solution sound like an easy fix. It is not.

For one, the Lightning protocol itself is still a work in progress. Rusty Russell, Poon, Dryja and others are doing their best to realize the project(s), but this is a long and slow process. Even the concept itself is not set in stone yet, and several problems still need solving. As such, it’s not quite certain the the Lightning Network will indeed work as promised.

Furthermore, and as stated above, the Bitcoin protocol itself will need improvements for the Lightning Network to be deployed securely. Some of the required fixes, moreover, are not that easy to implement, and, much like the Lightning Network itself, are still a work in progress. As such, they might take quite some time to deploy – if they are ever deployed at all.

Lastly, wallet software will need to adjust as well. The most likely outcome here would be that individual wallets – Bitcoin Core, Bitcoin XT, Electrum, mobile wallets, etc. – will include some kind of add-on. Users would then have the option to make a blockchain transaction, or use the Lightning Network instead. But like much of the rest of the Lightning Network, specifics of how this will work or what it would look like exactly are not yet fully flushed out.

Myth #11: The Lightning Network is urgently needed.

This 11th “myth” is more of a controversy than a myth.

It should first be noted that it is hard to say with certainty how urgently instant and (dirt) cheap transactions are needed. These properties have not really existed on the Bitcoin network so far, making it hard to asses how much demand there will be for these properties.

It is more commonly assumed that the Lightning Network is urgently needed to address scalability issues. The fact that the Lightning Network is far from ready is one reason some progressives have urged an increase in the block-size limit instead. If blocks fill up, they argue, fees might rise to undesirable levels, transactions will be too slow to confirm (or not confirm at all), and Bitcoin could even become overloaded. With no alternatives such as the Lightning Network, the outcome would be bad – perhaps even devastating.

As stated above, it is definitely true that the Lightning Network is far from ready. Luckily, however, blocks are not yet filling up either, at least not in such a way that it causes great trouble. Even Bitcoin XT developers Mike Hearn and Gavin Andresen – the two most prominent advocates of bigger blocks – acknowledge that it will probably take another year before this starts to happen. (Others believe it will take longer.) That means the Lightning Network probably has at least another year to deploy and gain traction.

Whether that is enough time is debatable. In one of his blog posts, Hearn argues that there are no credible technical proposals that could gain widespread adoption within one year, including the Lightning Network. Others, however, have been a bit more optimistic. While a year is not an awful lot of time to deploy something like the Lightning Network on a large scale, Bitcoin moves fast, and it’s not impossible either.

But more importantly, many on the decentralist side of the debate argue that full blocks wouldn’t be that big of a problem in the first place. Fees may rise a bit, and not all transactions would confirm within the first available block, but that would be fine. If this is true, it might take years before the Lightning Network is really, urgently needed for scalability reasons.

The post Debunking the 11 Most Stubborn Lightning Network Myths appeared first on Bitcoin Magazine.

After analysis had been posted, yesterday, bitcoin trading bought price up in a surge above resistance. Although more upside may be in store there is another upside technical hurdle looming on the horizon. This analysis is provided by xbt.social with a 3 hour delay. Read the full analysis here. Not a member? Join now and receive a $29 discount using the code CCN29. Bitcoin Trading and Price Analysis Time of analysis: 15h03 UTC BTC-China 1-Day Chart From the analysis pages of xbt.social, earlier today: The 1-day chart shows that yesterday's volatile move was technically justified: MACD (top) has been steadily […]

The post Bitcoin Trading Chooses The Upside appeared first on CCN: Financial Bitcoin & Cryptocurrency News.

As you know, block chain technology is all the rage in the financial world. In some cases, this is to the exclusion of Bitcoin itself. No matter how you think about that, several firms have cropped up to find other uses of the Bitcoin block chain, including Patrick Byrne's Overstock, a longtime supporter of Bitcoin, who just a few months ago opened the doors of TØ.com, a transparent stock lending platform. Stock lending is a massive part of the financial industry, with nearly a trillion dollars in stocks being on loan in the US at any time. Yesterday, Clique Fund, […]

The post Overstock's TØ.com Facilitates First Significant Trade With Block Chain appeared first on CCN: Financial Bitcoin & Cryptocurrency News.

Bitcoin exchange Bitreserve, Inc has undergone a major rebranding and repositioning to unveil itself as Uphold, Inc. In addition to the company’s original service wherein customers’ bitcoin could be converted into legacy currencies and metals, customers will now have the means to link their bank accounts to fund their Uphold accounts. Credit cards and debit cards will also be accepted, along with Bitcoin. In a blog post, CEO Anthony Watson spoke about the rebranding of the name along with the changes to the company’s platform. In a word, Uphold embodies our core values and is the best way we can […]

The post Bitreserve Revamps Itself and Becomes Uphold, Starts Offering Fiat Money Services appeared first on CCN: Financial Bitcoin & Cryptocurrency News.

Blockstream has announced its first Bitcoin sidechain called Liquid, set to be launched in early 2016. The sidechain will serve payment processors and brokerages among a dozen other major traders and licensed exchanges with instantaneous and secure transactions. Months after releasing the source code of Sidechain Elements - a codebase for developers to experiment and build sidechains, Blockstream, a startup comprising of a group of core Bitcoin developers has announced the first commercial application of sidechain technology with Liquid. Blockstream, having raised $21 million in venture capital late last year is gearing to deploy Liquid to be used among exchanges, […]

The post Blockstream Announces Liquid – the First Sidechain for Bitcoin Exchanges appeared first on CCN: Financial Bitcoin & Cryptocurrency News.

Overstock.com's CEO is on a crusade to remake the stock market using bitcoin technology. Now it's being used to move stock-market millions.

The post Hedge Fund Borrows $10M in Stock Via the Bitcoin Blockchain appeared first on WIRED.

Anthony Watson has held board level positions at Barclays, Citi, and Wells Fargo, and served as chief information officer for Nike.

In short, he is used to dealing with multi-billion dollar balance sheets and huge technology budgets.

But the 39-year-old's latest position is on a very different scale — Watson is CEO and President of 10-month-old Bitreserve, a startup aiming to harness the technology behind bitcoin to create the "internet of money."

Bitreserve is on Wednesday re-branding as Uphold and opening up its platform to the mainstream.

Until today its digital wallets could only be stocked with bitcoin (although this could be converted to 24 currencies). But now Uphold now lets you upload cash from traditional bank accounts and credit cards across 33 European countries, including the UK. US, and Chinese accounts will be available in November.

Aside from storing money online, Uphold's big selling point is it lets you transfer internationally and switch between currencies for free.

Business Insider sat down with Watson earlier this month to hear about the new service, why Watson decided to join the company, how his homosexuality has shaped his approach to the world, and how he hopes Uphold can tackle the "injustices in the financial system."

"Those who can least afford it always pay the most"

Watson, a gregarious and confident Irish-American, credits the 2008 crash with helping inspire his decision to join Uphold by highlighting the flaws within the world of banking.

"When the financial crash happened, I was on the board of [US bank] Wachovia in Hong Kong," said Watson. "I was summoned to a meeting with the Hong Kong regulatory authority and basically governments were calling in their loans.

"It’s one thing when a business wants to call in their loan. When a government calls in their loans we’re talking multiple billions of dollars. And when multiple governments call in their loans it’s a very different conversation. I got on a plane on Hong Kong not knowing if I’d have a job when I landed in Charlotte, North Carolina."

Wells Fargo ended up buying Wachovia. Watson stayed for a bit, then did a 5-year stint at Barclays running their technology across Europe, Africa, and the Middle East. But he decided he'd had enough of banking. He was disillusioned with the fact that the world of finance hadn't changed since the crash and was still carrying the same risks as before.

"At that point I said, you know what? I’m done with financial services," Watson explains. "I don’t like the business model, I don’t like how they operate, I don’t like the fact that those who can least afford it always pay the most, I don’t like the risks that banks pose to global economies. Nothing has fundamentally changed [since the financial crisis]."

'A bitcoin company? No thanks'

After Barclays, Watson went to Nike as chief information officer for just under a year, before leaving for personal reasons. It was then that Halsey Minor, the founder of Bitreserve, approached him.

Minor is a well-known US entrepreneur who founded consumer electronic website CNET in the 1990s (sold to CBS for $1.8 billion in 2008). He was an early investor in Salesforce.com, and founded Grand Central Communications, which became Google Voice when it was acquired by the search giant.

"He’s a Steve Jobs type character," Watson enthuses. "The guy is brilliant, he’s a future technologist."

But he was skeptical at first. Watson says: "When Halsey reached out to me, I was thinking, ‘A bitcoin company? No thanks, I’ve no interest in bitcoin.' But he said no wait let me explain."

Halsey launched Bitreserve in 2014 as a way to harness the blockchain technology that underpins bitcoin to makes money transfers cheap and simple. In fact, Bitreserve's technology that works with the blockchain means transfers are completely free.

To Minor, this is also about making financial services fairer for everybody, something that chimed with Watson.

Watson says: "We met at the Ivy Club [a restaurant in London's Covent Garden] and after 10 minutes I knew immediately it was what I wanted to do. His vision to transform the broken financial system and integrate legacy fractured systems of today with the future of money, and how that benefits everybody in society, just spoke to me."

"I wanted to get involved with something that made a demonstrable difference. I’m at that age now, I’m 39. I wanted to give back."

"Let me be clear, we’re not just doing this to make money"

Uphold, as it's now known, is trying to rethink the way a bank should operate, with the everyday customer in mind rather than investors or wealthy individuals.

Once customers put money into their accounts, they're free to send it to any other member on the platform, and free to convert it into 21 other currencies and 4 commodities. Transfers are at the best market rate and Uphold charges no commission or fees.

The only charges people incur are when money is taken off the platform, but even then people can withdraw up to £8,000 ($12,278) a year for free and above that only a 0.5% fee is charged.Watson explains how Uphold can do it: "People forget it doesn’t cost you to buy [money] at the mid-market rate, it’s what everyone pays. For example, a bank will buy $500 (£326) at the mid-market rate, no one can buy less than that unless someone is taking a hit somewhere.

"But then they add a forex fee to that and they add a conversion fee and a percentage and before you know it that $500 they bought, they’re charging you $570 (£371) for it. That’s how banks and transfer services make their money. That’s not our business model."

Uphold's makes its money simply by keeping as much money as it can in people's accounts and earning a modest profit from the interest. The downside of this is customers don't earn any interest on money held in accounts.

Traditional banks hold only a fraction of total customer deposits, between 7-11%, but Uphold will keep all client money rather than investing any. Watson says: "Let me be clear, we’re not just doing this to make money. We’re trying to make a profitable enterprise that is of value add to the world. There are other ways of obviously building businesses like this, but we believe this is the most fair and equitable way."

'I’ve always been a champion of the underdog'

Watson is most passionate when talking about how Uphold can give a better deal to the downtrodden and poor who are under-served by banks at the moment.

A typical polemic runs: "Look at the remittance corridor between the Mexico and the USA, it’s about $25 billion a year. The fees that are charged are around $2.5 billion a year. So basically it’s cost 10% to send money between Mexico and the USA. Why? There’s no fundamental reason.

"Those in our society who can least afford it, Mexican immigrants who demographically aren’t on the highest payrolls, are paying fees you or I wouldn’t in our dizziest day dreams. It’s just wrong. Those are the injustices in the financial system that we’re trying to tackle and we believe our model is very compelling because we’re real time, we’re free, we’re transparent."

Our hour-long conversation is peppered with declarations like this. Watson says it's his personal background that makes him so passionate about giving a fair deal to everyone in society.

Watson studied theology at university and planned to become a priest before realising he was gay. He's now an outspoken advocate for LGBT rights, sitting on the board of GLAAD, an LGBT homeless charity in the UK, and chairing the European diversity awards.

"I’ve always been a champion of the underdog. I’ve faced discrimination in my life and I’ve overcome it. I don’t say it in a way of “oh look at me, boohoo.” No one ever promised you life was going to be easy."

"It’s a very important part of who I am. That’s why I’m very sensitive when any minority or are group are marginalised by society. You should be treated equitably and fairly no matter who you are, what you do or where you do it, as long as you don’t do evil to your fellow man you should be left alone to do what you do."

But there is a lot of inequality and unfairness in financial services.

Watson says: "The person who lives in Brixton will pay a very different interest rate to someone who lives in Knightsbridge. You can’t say you’re publicly discriminating against somebody but your postcode tells a lot about you. It talks about your demographic, your income. It’s not the rich white guy like me that pays the most, it’s the person who can least afford it."

'Financial services will become broadly as simple as sending email'

Up until now Uphold has only been open to the bitcoin community, but has been hugely popular within it. The platform has processed over $400 million (£260.95 million) worth of bitcoin transactions between its 25,000 members, around 22% of all available bitcoin.

Watson is hoping that by opening up the service to traditional finance it can help the platform go more mainstream and he is hoping Uphold becomes as revolutionary in banking as models like Wikipedia have been in online publishing.

He says: "I believe financial services will become broadly as simple as sending email. If you think about it, in the mid-1990s your industry" — meaning the media — "went through a huge upheaval. People were saying you can’t give content away, that’s how we make money. Nobody pays for content anymore."

Uphold has trademarked the phrase "Internet of Money" and Watson promises deposits and money transfers will only be the start. A physical and digital Visa card linked to the account will launch later this year.

Uphold has raised $22 million (£14.3 million) since launch, including $10 million (£6.5 million) through crowdfunding in the UK, and Watson says the company isn't looking for any more investment.

"People have approached us — one major US bank has approached us — but we’re not interested. We’re not here to make a fast buck, we’re here to change the world. Nothing would make me as proud as to leave a legacy behind that we helped make the financial world a fairer place.

"I think it's important that those of us who have been successful in life have an obligation to give back and this is part of me giving back."

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Uphold will connect to banking systems in the U.S. and Europe to accept fiat currencies, making it the latest in a string of Bitcoin startups to further embrace fiat money.

Cryptocurrency exchange Yacuna has announced its closure on November 15, 2015. Customers of the European exchange received letters of the news and have also been asked to withdraw their funds before the date of closure. In a letter sent to all its customers, Yacuna announced that the exchange will close in November. The London-based exchange offered trading in bitcoin, litecoin and dogecoin for European users. An excerpt from its letter sent out to customer read: Dear Yacuna customer, We want to thank you for all your loyalty and trust. Bitcoin is a wonderful technology, and we are proud, that we […]

The post It's Curtains for Bitcoin Exchange Yacuna appeared first on CCN: Financial Bitcoin & Cryptocurrency News.

Cryptocurrency exchange Yacuna has announced its closure on November 15, 2015. Customers of the European exchange received letters of the news and have also been asked to withdraw their funds before the date of closure. In a letter sent to all its customers, Yacuna announced that the exchange will close in November. The London-based exchange offered trading in bitcoin, litecoin and dogecoin for European users. An excerpt from its letter sent out to customer read: Dear Yacuna customer, We want to thank you for all your loyalty and trust. Bitcoin is a wonderful technology, and we are proud, that we […]

The post It's Curtains for Bitcoin Exchange Yacuna appeared first on CCN: Financial Bitcoin & Cryptocurrency News.

Cryptocurrency exchange Yacuna has announced its closure on November 15, 2015. Customers of the European exchange received letters of the news and have also been asked to withdraw their funds before the date of closure. In a letter sent to all its customers, Yacuna announced that the exchange will close in November. The London-based exchange offered trading in bitcoin, litecoin and dogecoin for European users. An excerpt from its letter sent out to customer read: Dear Yacuna customer, We want to thank you for all your loyalty and trust. Bitcoin is a wonderful technology, and we are proud, that we […]

The post It's Curtains for Bitcoin Exchange Yacuna appeared first on CCN: Financial Bitcoin & Cryptocurrency News.