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The reformed Bitcoin Maxi who saw the light: Erik Voorhees

March 3, 2021 by Blockchain Consultants

“We felt like we were doing God’s work,” explains cryptocurrency payments pioneer Erik Voorhees as he recalls trying to convert the unbelievers in the early days of Bitcoin.

The man whose gambling platform SatoshiDice was once responsible for half of all Bitcoin transactions, is now an elder statesman of crypto and the CEO of the ShapeShift exchange.

He remembers Bitcoin being written off as a joke at the Money 2020 conference in Las Vegas back in 2012. At the time he was working for BitInstant, one of the first Bitcoin exchanges, and they had a booth right next door to PayPal.

“I remember the PayPal people nearby kind of snickering at us. A couple of them had maybe heard of Bitcoin. If they’d even heard about it, it was a total joke — a stupid scam on the internet, or something. It was a totally unproductive conference.”

History has not been kind to the snickerers and scam-sayers, many of whom have since been converted. In 2020, eight years after the conference, Paypal finally joined the fray, enabling users to buy and sell crypto, and it will soon add it as a method of payment at 29 million merchants.

Voorhees spread the gospel of Satoshi at the conference alongside Charlie Shrem and Roger Ver. Shrem was the founder of BitInstant, viewed by some as a martyr to the cause after serving two years in prison on a case related to an exchange user reselling Bitcoin on the darknet marketplace Silk Road. Ver was perhaps the biggest believer of all, earning the nickname ‘Bitcoin Jesus’ for his charismatic promotion of the currency.

“In terms of proselytizing, Roger was the absolute best. He was a total maniac about it” Voorhees recounts with a chuckle.

“Even for Charlie and I, who were very much supportive of the general sentiment, It was pretty overwhelming and just incessant.”

“Everyone that works at a startup feels a little bit like they’re changing the world, that they have this huge mission, and certainly every company tries to amplify that,” he says, being a CEO himself. But for Bitcoiners, Voorhees clarifies, “it is really a ‘change the world’ kind of thing, and to change the world on a fundamental level. It’s to change the institution of money itself — that is a profoundly tall order.”

Vorhees explains that he sees Bitcoin as nothing less than revolutionary:

“It’s not just a better user-interface for the money that people had before. It’s a different type of money that changes government, changes culture, changes social and economic relationships on a very very deep deep level. That’s why it’s taken so long to to catch on, to get recognized, because it is trying to move into such an entrenched institution.”

It’s 2012. @ErikVoorhees @rogerkver and I decided to pool our money together for the first #Money2020 event. We told them we wanted the best booth we could afford, but we needed to be next to the @PayPal booth so we can show the world OUR financial system!

Welcome, Paypal! pic.twitter.com/5BzvQDfvFb

— Charlie Shrem (@CharlieShrem) October 21, 2020

Libertarian roots

Now 35, Voorhees spent his early ‘90’s childhood in the mountains of Colorado before moving to the University of Puget Sound near Seattle in 2003. He studied international economics and business but doesn’t really feel like he learnt either.

“In the entire major of economics, though I had courses in the history of economic thought, I never learned about the Austrians,” he says, referring to the Austrian School of economics. Often ignored by mainstream Keynesian economists, Austrians are obsessed with things like hard money and decry unbacked fiat currencies so they have been embraced by gold-bugs and the Bitcoin community, which is after all, often called ‘digital gold’.

A freshly minted graduate in 2008, Voorhees left to pursue adventure in Dubai where “anyone with a college degree could immediately get a job, because they were growing so fast.”

Working as a marketer for a real estate agency, he watched from a distance as the world he thought he knew began to buckle under the weight of the unfolding Global Financial Crisis. Dubai did not feel its effects until half a year later, he recounts, describing the intervening time as “this very weird period where Dubai was going through this massive economic boom, and the rest of the Western world was falling apart.”

From this desert oasis spared from the global drought, the business and economics graduate “started really understanding money on what I felt was a very fundamental level.” For Voorhees, the story of money is a simple one: “money emerges as the good that is bartered for most frequently.” That used to be gold and is currently fiat money, but it could just as well be something else, if a more useful and efficient money was embraced.

Upon this realization, Voorhees took on a “very strong aversion to fiat currency and to government control of money” because as a believer in a market economy, he felt that no government should control the price or distribution of any goods. “Money was actually the most important good of all, and thus most important to not be centrally planned. And yet it was even in, you know, allegedly capitalist economies,” he says.

“A capitalist economy that has a government-managed money system seemed completely antithetical, but I didn’t have any answers or solutions to that other than some kind of return to the gold standard, which seemed somewhat anachronistic.”

Voorhees returned to Colorado after two years abroad, soon moving to New Hampshire to join The Free State Project, an organized political migration which he describes as “a multi-decade initiative to move 20,000 radical libertarians to one small jurisdiction [New Hampshire] to hopefully have an outsized influence on the political structure.” It was there, in the company of fellow radical libertarian political activists, that Voorhees encountered Bitcoin in 2011.

“At that point I got completely hooked, and a year later ended up leaving New Hampshire and moving to New York to join Charlie Shrem at BitInstant.” There, he took the reins of marketing as employee number three.

It was around that time that Charlie Shrem, Roger Ver, and Erik Voorhees — each of whom would go on to become crypto-luminaries in their own right — pooled their money together to set up a Bitcoin booth at the Money 2020 conference in Las Vegas. “We needed to be next to the PayPal booth so we can show the world OUR financial system,” Shrem recounted. Vorhees says they failed to convert anyone to Bitcoin at the conference despite their best efforts.

Belief in false profits

Vorhees admits he used to be a Bitcoin Maximalist, a believer in the one true coin who rejected all false currencies. “I used to be a maximalist. Obviously when I got into Bitcoin, it was kind of the only coin,” he says.

“As other coins came out I dismissed them, scoffed at them, and generally didn’t like them because I felt like they were a distraction from the important project.”

Though he tried to focus on Satoshi’s vision, the new projects started gnawing at him and he realized that many of them “were doing things that Bitcoin wouldn’t do or couldn’t do.” By mid 2014, his conversion was in full swing.

“My whole mindset began changing. One of the most important things about Bitcoin is that it is decentralised. And it seemed to me antithetical to have a decentralized digital economy where there is only one chain — you know, one code base, one chain, one set of economic rules. It seemed very appropriate that you would get multiple different digital assets, and that was actually part of the decentralization, part of the virtue of Bitcoin was that Bitcoin isn’t the only thing there.”

He tempers this by adding the usual provisos — most tokens are garbage, many are scams, a majority will fail. “It’s only a minority of them that are interesting, but a minority is a lot more than one.”

ETH Folks… try not to become to Binancechain what the Bitcoin Maxis are to Ethereum 🙏

— Erik Voorhees (@ErikVoorhees) February 19, 2021

He still has empathy for his “shortsighted” maximalist peers, who he sees as victims of human nature’s tendency toward tribalism, which expresses itself in lots of ways, “Certainly it expresses itself in religion. And it has expressed itself in crypto, and some portion of people- their mind twists itself into complete advocacy of one flag and complete derision of all others.”

“[It’s] a group psychological phenomena and I don’t know how that stops, but I do think it is really harmful for the growth of decentralized digital finance generally.”

Gambling with Satoshi’s dice

Only a year after learning about Bitcoin, Voorhees launched Bitcoin-based gambling site SatoshiDice in 2012, which took the young crypto community by storm.

“On Reddit, this guy posted that he had created this casino-like mechanism where there’d be this dice roll, and based on the dice roll, a user would either get their coins sent back or lose them. I tried it, and there was magic in it immediately […] So I started working with him.”

This was groundbreaking because “it allowed any person in the world to place a bet by sending a Bitcoin transaction” no matter where they were from or how their local laws governed online gambling.

What’s more, the player did not need to trust SatoshiDice, because “it was provably fair,” meaning that it worked like a transparent machine where all odds and inner workings were open for anyone to inspect. Governments around the world have various commissions to regulate and audit gambling operations, but SatoshiDice’s function potentially made such organizations obsolete, powerless, or both.

“SatoshiDice showed you what the odds were. It was transparent with the odds, and you could prove that the rules were fair.”

The simple, trusted, and permissionless nature of SatoshiDice brought huge success to the platform. Within months of launch, the game was responsible for as much as half of all Bitcoin transactions.

SatoshiDice had an unofficial IPO on the MPEx exchange, a sort of Bitcoin stock market where unregistered Bitcoin companies offered shares and paid dividends denominated in BTC. These were the forerunner of the ICO boom several years later, and attracted similar attention from authorities for breaking securities laws.

Though the casino was “making a tonne of money,” it was also overwhelming as Voorhees felt his job of “running the world’s biggest Bitcoin casino” was distracting him from his greater calling of preaching the good word of Satoshi. Despite ongoing growth, he reluctantly sold the business in 2013 for 126,315 BTC which was then worth $12 million. That would be a cool $6.25 billion today.

Fighting the system

Voorhees did not enjoy calm for long, as the US Securities and Exchange Commission (SEC) soon came after him for making a public offering of unregistered securities. Voorhees considered this unfair, seeing that his investors had made exponential returns. He ended up settling for $50,000.

“That was nine months of total misery, dealing with them. If I didn’t despise the government before, I certainly did it after that. It was such bullshit.”

A core value of his is that people should be free to transact with each other voluntarily, and that no government agency has the right to come in between them. In his worldview, “institutions and government exist purely to curtail people’s power over money,” whereas “crypto gives people total economic power to make transactions in any way they wish, and no one can stop it.” As Voorhees sees it, these two forces will inevitably clash.

Voorhees’ company Shapeshift allows users to trade cryptocurrencies without identity verification. Things were not always that way — in 2018 Voorhees says his company fell under the same rules as traditional banks and therefore had to implement Know Your Customer, or KYC, identity verification procedures, making anonymous transactions impossible. “That was absolutely miserable. Our customers hated it. I hated it.”

But by 2020, decentralized exchanges (DEX’s) which allow users to trade without depositing their funds with a third party were gaining ground and made it possible for Shapeshift to reorient its business and re-align with its libertarian values. All KYC was abandoned, and the platform became a gateway for users to trade on various DEX’s. “I had learned with Satoshi Dice that an economic relationship didn’t need anything other than a public key to send in a transaction, and anything else could be based around that,” he says.

Voorhees says that his opposition to KYC is not down to ideology but his desire to protect users against things like identity theft.

“Identity theft in the US alone is something like a $30B to $40 billion a year problem. It is more costly than all forms of property theft combined. It’s this massive thing, and crypto comes along and solves that problem.”
But how committed is he to this principle? Would he class it as theft if a government accessed user data to tax a client’s unreported financial transactions. “Yeah, exactly. Taxation is absolutely theft,” he responds with blunt matter-of-factness.

The WSJ investigates

ShapeShift’s ethos has proven controversial among adherents to the rules and regulations around traditional finance. An investigation by the Wall Street Journal alleged Shapeshift users had laundered $9 million via the platform. However a third-party analysis by blockchain intelligence firm CipherBlade suggested the investigation was flawed in assuming that funds were illicit even after passing through four different hands, causing the $9 million figure to be inflated by a factor of four. It is clear that Voorhees, who is normally calm and composed, was deeply affected by this.

“Here’s The Wall Street Journal coming after us, calling us the money launderer, when their own inflated number would put us as far better [at combating money laundering] than any of the major banks that they write about all the time.”

There’s a noticeable quaver in his voice. The battle is personal.

We spend the last minutes comparing attitudes toward money in different societies. In the Nordic countries for example, all taxes are a matter of public record. Voorhees finds this disturbing, adding that “a lot of people with money feel guilty about it” whereas creating wealth in an ethical way he believes is a good thing for society.

“I would like to see people who become very wealthy, first of all be proud of that, so long as they did it in an ethical way, and to use those resources in whatever way they think is best. I think that’s how that’s how economies grow and I think there’s nothing wrong with that.”

The reformed Bitcoin Maxi who saw the light: Erik Voorhees

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Enterprise meets DeFi: Organizations work toward adopting blockchain tech

March 2, 2021 by Blockchain Consultants

Decentralized finance is quickly maturing. While the total value locked in DeFi is over $45 billion, financial institutions and large corporations are starting to implement DeFi concepts to automate business processes. This is known as “enterprise DeFi.”

For instance, invoices and other financial products can be tokenized to ensure that transactions are valid and should be processed for payment across multiple parties. Coke One North America is one of the first large corporations to demonstrate this.

CONA is leveraging the Baseline Protocol — a project that coordinates confidential workflows between enterprises using messaging, zero-knowledge cryptography and blockchain — to tokenize invoices. CONA aims to “baseline” its entire supply chain by giving internal bottlers and external suppliers access to a private, distributed integration network.

Through use cases like CONA, such solutions are quickly gaining traction. There are also a number of vendors entering this infrastructure market including Provide, an enterprise middleware provider, and Big Four firm Ernst & Young. Most recently, ConsenSys — one of the leading blockchain software companies — announced plans to use Baseline Protocol as a solution for its enterprise clients, further demonstrating the importance of enterprise DeFi adoption.

How ConsenSys plans to drive enterprise DeFi

Specifically, ConsenSys Codefi — ConsenSys’ fintech suite that connects financial use cases to blockchain counterparts — will soon offer a baseline-compliant solution for its enterprise clients.

Didier Le Floch, institutional products and engineering lead at ConsenSys Codefi, told Cointelegraph that while the Baseline Protocol was developed by EY, ConsenSys and Microsoft, Codefi has been taking steps to ensure that its products will eventually be fully compatible with it:

“We want to enable the use of digital assets and the financing of those assets for payment use cases. These use cases will generate maximum business value, combining automation of business processes and payments using things like stablecoins, for example.”

In order to achieve this, Floch explained that the Codefi tech stack will be combined with the Baseline Protocol to deliver an effortless user experience for cases such as financing supply chains. Floch remarked that this is a first step in the right direction, as Codefi strongly believes that the enterprise sector will soon converge with the DeFi market: “There will be ebbs and flows, and it will be a journey with various steps, but we’ve already seen the promise of this convergence in the DeFi market.”

To his point, MakerDAO — the protocol behind the stablecoin Dai — announced support in June 2020 to use non-crypto-native assets, such as invoices and music streaming royalties, as collateral for its Dai stablecoin. Maker also voted to support a protocol from blockchain startup Centrifuge to bring real-world assets on its platform. Known as “Centrifuge Chain,” this is built on Parity’s blockchain development framework, Substrate.

Asset originators can use the Centrifuge Chain to mint nonfungible tokens of real-world assets, converting them to ERC-721 tokens. These assets can then be added to Tinlake, which is Centrifuge’s Ethereum-based DeFi protocol for decentralized asset financing.

A Centrifuge spokesperson told Cointelegraph that the company is currently working with MakerDAO to bring New Silver, an online real-estate lender, on to the Maker platform as an asset originator. As such, NewSilver would be the first asset originator using Tinlake to get to the MakerDAO executive vote, ultimately allowing asset originators to generate Dai as a credit facility.

DeFi protocol Aave also introduced a diversified money market to support real-world assets back in October 2020. According to the Aave blog post, this money market would make it easy for the Aave community to onboard real-world assets into the protocol, allowing investors to lend against assets, such as invoices, real estate and inventory finance. “Right now, it’s at a small scale, but there are DeFi lending protocols already taking steps to incorporate real-world assets into their protocols,” said Floch.

Breaking down barriers hampering adoption

Many enterprise DeFi concepts are still in early development, as a number of barriers exist. For instance, there are concerns regarding publicly available sources to determine the price of collateralized assets. Furthermore, many DeFi protocols venturing into the enterprise space only allow solutions for borrowing in crypto, which may be unappealing to mainstream organizations. Moreover, paying transaction fees in cryptocurrency may also be problematic for enterprises that typically deal in fiat payments.

Floch explained that Codefi’s use of Baseline Protocol is intended to address these concerns. For example, he noted that there will be an “Infura ITX” integration that will enable corporations to pay gas fees in dollars rather than Ether (ETH) when using the Baseline Protocol. Since the platform leverages the Ethereum network as its mainnet of choice, or as a common frame of reference for complex workflows, this integration will ensure a better user experience overall.

In addition, Floch mentioned that ConsenSys’ open-source zero-knowledge proof library, known as “gnark,” will be leveraged to ensure enterprise data remains private, yet verifiable.

While notable, Codefi’s implementation of the Baseline Protocol isn’t the only solution intended to solve the challenges related to enterprise DeFi adoption.

For example, EY has been heavily involved in the blockchain space, specifically in terms of enterprise DeFi development. Paul Brody, global blockchain lead at EY, told Cointelegraph that the firm has been working on DeFi enabling solutions since 2016, with the goal of making the inputs and outputs of enterprise business processes tokenized and then transactable:

“This means purchase orders, invoices, receivables, inventory — everything in traditional business-to-business processes should be ready to integrate into a DeFi ecosystem.”

Of course, Brody is aware of the challenges regarding this vision, noting that the first element to be tackled is achieving an acceptable level of privacy for enterprise users. Once this is accomplished, Brody explained that necessary standards need to be established where bodies, such as the Enterprise Ethereum Association, can be key partners in the pursuit of these goals.

Brody further mentioned that as an industry auditor, EY will not be offering financial services involving DeFi. Rather, the firm is devoted to ensuring that enterprise clients will be able to plug their business operations into existing DeFi solutions. For example, Brody explained that EY’s Network Procurement solution is designed to manage purchase orders and fulfillment, which would allow enterprises to exchange tokens for purchase orders, contracts, invoices and inventory transfers. “As soon as we see standards we can leverage, we hope that our enterprise users will be able to take advantage of these markets,” said Brody.

Institutions show interest in DeFi?

In addition to a growing number of enterprise DeFi solutions in development, there is now interest in DeFi from large organizations and financial institutions. This was recently demonstrated by the leading digital currency asset manager, Grayscale. On Feb. 26, 2021, the firm announced consideration to offer investors access to DeFi assets, including Aave, Compound’s COMP, MakerDAO’s MKR, Reserve Rights (RSR), SushiSwap’s SUSHI, Synthetix Network Token (SNX), Uniswap’s UNI and Yearn.finance’s YFI.

Although this is separate from enterprises using DeFi protocols to find real-world assets, Floch noted that this demonstrates more institutional players are ready to invest in prominent DeFi protocols:

“For institutional customers of Grayscale to start investing in those tokens is definitely a sign that they’re getting more comfortable with Defi, while understanding the value of those protocols (asset management, collateralized lending and trading automated in smart contracts).”

Enterprise meets DeFi: Organizations work toward adopting blockchain tech

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Transparent stablecoins? Conclusion of Tether vs. NYAG raises new questions

February 28, 2021 by Blockchain Consultants

A long-standing legal drama finally found resolution on Feb. 23, with the New York Attorney General’s office announcing that it had come to a settlement with cryptocurrency exchange Bitfinex after a 22-month inquiry into whether the company had been trying to cover up its losses — touted to be worth $850 million — by misrepresenting the degree to which its Tether (USDT) reserves were backed by fiat collateral.

According to the terms of the announced settlement, which now marks an end to the inquiry that was initiated by the NYAG back in Q1 2019, Bitfinex and Tether will pay the government body a fixed sum of $18.5 million but will not be required to admit to any wrongdoing. That being said, the settlement clearly states that henceforth, Bitfinex and Tether can no longer service customers in the state of New York.

Furthermore, over the course of the next 24 months, Bitfinex and Tether will be required to provide the NYAG with quarterly reports of their current reserve status and duly account for any transactions taking place between the two companies. Not only that, but the firms will also be required to provide public reports for the specific composition of their cash and non-cash reserves.

On the subject, NY Attorney General Letitia James said that both Bitfinex and Tether had covered up their losses and deceived their customers by overstating their reserves. When asked about this most recent development, Stuart Hoegner, general counsel at Tether, replied to Cointelegraph with a non-committal answer, stating:

“We are pleased to have reached a settlement of legal proceedings with the New York Attorney General’s Office and to have put this matter behind us. We look forward to continuing to lead our industry and serve our customers.”

Does a New York exclusive ban even make sense?

To gain a better legal perspective of the situation, Cointelegraph spoke with Josh Lawler, partner at Zuber Lawler — a law firm with expertise in crypto and blockchain technology. In his view, the lawsuit, and particularly the nature of the settlement in which Tether and Bitfinex agreed to cease actions, underscore the confusion inherent in the regulation of digital assets in the United States.

Additionally, the agreement by Bitfinex and Tether to prohibit the use of its products and services by New York persons and entities seems on paper to be nearly impossible to accomplish, with Lawler opining:

“Are they saying that no one with a New York nexus can own or trade Tether? Tether is traded on virtually every cryptocurrency exchange in existence. Even if Tether could restrict the use of Tether tokens by New Yorkers, is that really a good idea? Do we now have a world in which every state can pick off particular distributed ledger projects from functioning within their jurisdiction?”

Lastly, even though the deal between Bitfinex/Tether and the NYAG has come in the form of a settlement — i.e., it is not subject to an appeal or federal scrutiny under the commerce clause — state-centric bans may further add to the existing regulatory uncertainty.

Added transparency is always a good thing

With regulators now asking Tether and Bitfinex to be more forthcoming about their monetary dealings and issuing an arguably small fine on them, it seems as though an increasing number of firms dealing with USDT will now have to pull up their socks and get their account books in order. Joel Edgerton, chief operating officer for cryptocurrency exchange bitFlyer USA, told Cointelegraph:

“The key point in this settlement is not the elimination of the lawsuit, but the increased commitment to transparency. The risk from USDT still exists, but increased transparency should cement its lead in transaction volumes.”

In a somewhat similar vein, Tim Byun, global government relations officer at OK Group — the parent company behind cryptocurrency exchange OKCoin — believes that the settlement can be looked at as a win-win scenario not only for NY OAG and Tether/Bitfinex but also for the cryptocurrency industry as a whole, alluding to the fact that that the 17-page settlement revealed no mention of Bitcoin (BTC) being manipulated via the use of USDT.

Lastly, Sam Bankman-Fried, chief executive officer for cryptocurrency exchange FTX, also believes that the settlement, by and large, has been a good development for the industry, especially from a transparency perspective, adding:

“Like many settlements, this one had a messy outcome, but the high-level takeaway here is that they found no evidence to support the heaviest accusations against Tether — no evidence of market manipulation or unbounded unbacked printing.”

Will scrutiny of stablecoins increase?

Even though stablecoins have been under the regulatory scanner for some time now — since they claimed to be pegged to various fiat assets in a 1-1 ratio — it stands to reason that added pressure from government agencies may be present when it comes to the transparency side of things from here on out.

Another line of thinking may be that governments all over the world will now look to curtail the use of stablecoins, such as USDT, especially as a number of central banks are coming around to the idea of creating their very own fiat-backed digital currencies. As a result, governments may want to push their citizens to use their centralized offerings instead of stablecoins.

Related: Many pieces of the Diem puzzle still missing as launch gets delayed

On the subject, Byun noted: “Stablecoin is just one type of cryptocurrency or ‘convertible virtual currency,’ and therefore, stablecoins and the stablecoin market will continue to attract scrutiny and mandated examinations from regulators.” That said, Byun believes that whether it’s Bitcoin, Ether (ETH) or Tether, crypto investors generally understand that investing in crypto remains a high-risk activity and that they “must practice caveat emptor” at all times.

Does Tether impact institutional adoption?

Another pertinent question worth exploring is whether or not the settlement may have an adverse impact on the institutional investment currently coming into this space. In Lawler’s opinion, the decision is not going to slow down adoption even in the slightest. “Institutions are not principally focused on Tether. There are other stable coins, and Bitfinex is all but irrelevant to them,” he added.

Similarly, it could even happen that the ongoing reporting requirements set by the NYAG for Bitfinex and Tether may end up bolstering institutional confidence in Tether — a sentiment that some of Tether’s most vocal and consistent critics also seem to agree with.

That being said, a lot of speculation around Tether’s fiat reserves continues to linger on; for example, Tether Ltd.’s finances are handled by Bahamas-based Deltec bank. In this regard, one anonymous report claimed that “from January 2020 to September 2020, the amount of all foreign currencies held by all domestic banks in the Bahamas increased by only $600 million,” up to $5.3 billion. Meanwhile, the total volume of issued USDT soared by a whopping $5.4 billion, up to around $10 billion.

As Tether states on its website USDT is covered by fiat and other assets, so such investigations cannot be conclusive. However, what both NYAG and the anonymous authors of the report agree upon is that Tether needs to be more forthcoming about its financial status. With that in mind, Tether’s commitment toward transparency and revealing its reserves to a regulator seems like a step in the right direction.

Transparent stablecoins? Conclusion of Tether vs. NYAG raises new questions

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UK firm launches service for company treasuries to invest in Bitcoin

February 19, 2021 by Blockchain Consultants

BCB Group, a global digital financial services firm, is planning to help corporations navigate cryptocurrencies like Bitcoin (BTC) by launching a dedicated service.

According to a Feb. 19 announcement, BCB Group has launched BCB Treasury, a new service designed for corporate treasury departments seeking to get involved in Bitcoin à la Tesla. 

The new service aims to provide a specific solution enabling access to treasury management for companies willing to invest their capital into Bitcoin and other digital assets. With BCB Treasury, executives can enter, hold, manage, and report on a Bitcoin-focused treasury strategy, the announcement states.

BCB Group founder and CEO Oliver von Landsberg-Sadie said that the launch of BCB Treasury comes in response to growing demand triggered by the recent Bitcoin moves of companies like MicroStrategy and Tesla. The exec said that lots of companies are looking to invest in crypto to hedge against weak fiat currencies:

“We are seeing some powerful signals attracting companies to the digital asset space including the debasement of reserve currencies through unprecedented levels of central bank money supply.”

Last year, BCB Group’s core business BCB Payments received regulatory approval from the United Kingdom’s Financial Conduct Authority.

Headquartered in London, BCB Group is a major European crypto payment services provider, serving some of the world’s largest crypto companies like Coinbase, Gemini, Galaxy Digital, Bitstamp and Kraken. In early February, the firm appointed former Coinbase UK CEO Zeeshan Feroz as an advisor.

UK firm launches service for company treasuries to invest in Bitcoin

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Israeli digital securities exchange gets preliminary green light from regulators

February 18, 2021 by Blockchain Consultants

An Israeli start-up that aims to establish a digital ledger technology-based digital securities exchange in the country has received its first, encouraging go-ahead from the Israel Securities Authority.

In an application letter filed with the regulator on Feb. 14, Simetria had sought the ISA’s approval to operate a digital bulletin board as a preliminary step in its roadmap for the eventual launch of its digital exchange. The letter noted the increasing integration of DLT technologies into market infrastructures globally, and the evolution of legislative frameworks to accommodate this innovation. 

In the case of Israel, a Memorandum of Securities Law published by the ISA in 2020 proposed legislation that would facilitate the creation of smaller-scale, innovative digital exchanges:

“The Ministry of Finance wishes to promote securities trading activities on trading platforms that do not operate on the same scale as the Tel Aviv Stock Exchange, and have unique features or designated purposes, such as trading platforms designated for sophisticated investors (such as insurance companies, pension funds, and banking corporations) or platforms that use novel technologies (such as blockchain technology).”

Simetria’s letter thus asked the ISA to approve its operation of one of its products in the short-term: a “digital bulletin board” that will provide information about private firms that are raising capital in the primary market, as well as information about the securities of private firms being offered for sale by their owners (the secondary market). In the bulletin board, potential sellers and buyers would be able to publish sales and purchase indications of various kinds.

According to a report published by Israel newspaper The Globes on Feb. 17, the ISA has now swiftly approved Simetria’s application request for operating the bulletin board. Simetria co-founder and CEO Ziv Keinan said that the approval brings Israel into step with those countries at the forefront of digital securities innovation globally:

“The ISA’s decision is a dramatic milestone towards the establishment of a digital securities exchange in Israel […] Private companies will soon be able to offer digital securities to international institutional investors on Simetria’s technology platform in a way that will allow them to raise capital and gain liquidity.”

Kienen’s perspective has been echoed by Oded Spirer, CEO of the ISA, who has himself said that “digital securities markets are no longer in the distant future, but rather in the here and now.”

In other recent crypto regulatory developments in Israel, several lawmakers have proposed amending existing tax legislation so that digital currencies like Bitcoin (BTC) would not be subject to capital gains taxes, but be treated more like fiat currencies instead. The proposal would, if pursued, significantly lower Israel crypto investors’ tax bills.

Israeli digital securities exchange gets preliminary green light from regulators

Source

Filed Under: blockchain technology Tagged With: Banking, Bitcoin, blockchain, Capital Gains, ceo, Co-founder, Companies, crypto, Currencies, Developments, Digital, digital currencies, DLT, exchange, Exchanges, fiat, finance, information, insurance, Israel, Ledger, Legislation, Market, Markets, other, tax, Taxes, Technology, Trading

Top 30 Hyperledger Interview Questions for 2021

February 12, 2021 by Blockchain Consultants

Top 30 Hyperledger Interview Questions for 2021

Are you planning to prepare yourself for Hyperledger interviews and become a successful Hyperledger Expert? You have landed on the right page. This article talks about the top interview questions so that you can mentally prepare answers for them.

Excited? So let’s get started.

Table of Contents 

  • Top Hyperledger Questions You Should be Prepared for 
  • Concluding Lines: How to Learn and Become a Certified Hyperledger Professional 

Top Hyperledger Questions You Should be Prepared for 

  • What is Hyperledger?

It is an open-source global collaboration that helps in creating and developing enterprise-grade and distributed ledger frameworks to support business transactions and to advance cross-industry blockchain technologies, hosted by the Linux Foundation.

  • Is Hyperledger public or private?

It is a private blockchain. 

  • Enlist projects under the Hyperledger umbrella?

Hyperledger Fabric, Hyperledger Indy, Hyperledger Burrow, Hyperledger Iroha, Hyperledger Sawtooth, Hyperledger Besu, Hyperledger Caliper, Hyperledger Cello, Hyperledger Explorer, Hyperledger Avalon, Hyperledger Quilt, Hyperledger Ursa, Hyperledger Aries, Hyperledger Transact, and Hyperledger Grid. 

  • What are the major goals of Hyperledger?

  • The main aim of this technology is to create an enterprise-grade, open-source, distributed ledger framework to improve business transactions.
  • Next is to provide a community-driven, open infrastructure that is supported by technical and business governance. 
  • It aims at educating the crowd about the market opportunity for blockchain technology.
  • Distinguish between Hyperledger and Ethereum.

The major difference is that Ethereum is a public blockchain, whereas Hyperledger is permissioned and private. It is designed to create an enterprise-grade, open-source, distributed ledger framework to improve business transactions. Ethereum, on the other hand, runs the Smart Contracts on the EVM for applications that are attributed to being decentralized and are for mass consumption. Hyperledger is for a B2B business, whereas Ethereum is a B2C business. Another difference is that Ethereum utilizes Solidity programming language, whereas Hyperledger utilizes Golang. 

  • What is Hyperledger Fabric?

Fabric is one of the blockchain projects within Hyperledger that has a ledger, uses smart contracts, and offers a system by which participants can manage their transactions like other blockchain projects. It has a private and permissioned network whose modular architecture maximizes blockchain privacy, flexibility and eases decision-making capabilities.

  • What is Hyperledger Sawtooth?

Sawtooth is an open-source platform, a blockchain suit for developing, running, and creating new distributed ledgers. Sawtooth’s architecture is believed to be flexible and modular. It separates the core system from the application domain so that smart contracts can specify the business rules without needing to know the underlying design. This project aims at keeping ledgers distributed and making smart contracts safe for enterprise use.

  • What is Hyperledger Indy?

Like other Hyperledger projects, Indy is also a distributed ledger that comes with reusable components along with several tools and libraries, explicitly designed for identity-based solutions. It is a group of tools, libraries, and further components for digital identities rooted in blockchains.

As it offers an identity-based solution, that means one will have complete control over their identity, and no one can control it. This project is interoperable with other blockchains and also can be used standalone, powering the decentralization of identity.

  • What is Hyperledger Iroha?

Iroha is a distributed ledger software that offers varieties of libraries for developers, provides role-based access control, offers simple deployment and maintenance, and works on improving reliability, performance, and usability. 

  • What is a Hyperledger Quilt?

It is a Java implementation of the Interledger protocol. This project enables crypto and fiat payments across any payment network. It provides an implementation of all core primitives required to send and receive payments in a ledger-agnostic style. 

  • What is the Hyperledger Transact?

Hyperledger Transact is a library that aims to reduce the development effort in writing distributed ledger software by providing a standard interface that let’s execute smart contracts, including all aspects of scheduling, transaction dispatch, and state management.

  • What is Hyperledger Besu?

It is an open-source Ethereum client developed under the license of Apache 2.0 and uses java programming language. Besu is an enterprise-focused initiative that can be run on either of the networks, i.e., public and private permissioned networks, along with test networks such as Rinkeby, Gorli, and Ropsten.

  • What do you know about Hyperledger Fabric 2.0?

Fabric 2.0 has introduced various features in its latest version. These are as follows: 

  • Decentralized governance for smart contracts 
  • New chaincode lifecycle
  • New chaincode application patterns
  • Automated checks
  • Decentralized agreements
  • Private data enhancements 
  • New smart contract launcher
  • Decentralized ordering service
  • Introduction of fabtoken
  • Multiple chain codes on a channel
  • Performance enhancements
  • Can you name some of the top healthcare projects powered by Hyperledger?

  • MELLODDY Project
  • Axuall Project 
  • MyClinic.com
  • KitChain 
  • Verified.me 
  • What are the Nodes and Channels in Hyperledger Fabric?

    The communication entries in Hyperledger are nodes, and the subnet of a Hyperledger network is known as the channel. 

  • Chaincode is written in which language?

It is written in multiple languages, including Golang and Java SDK. 

  • What are the types of nodes in Hyperledger Fabric?

There are three types of nodes:

  1. A client that submits a real transaction-invocation and broadcasts transaction-proposals to the ordering service.
  2. A peer node is a node that commits transactions and maintains the state and a copy of the ledger.
  3. Ordering-service-node is a node running the communication service that implements a delivery guarantee.
  • Explain Hyperledger Burrow?

Burrow is a fully-fledged blockchain node and smart contract execution engine that focuses on simplicity and speed. Burrow runs and executes Ethereum Virtual Machine and Web Assembly (WASM) smart contracts and are synchronized using the Tendermint consensus algorithm. It is an open platform that is mainly optimized for public and permissioned Blockchain; however, it can also be used as private blockchains.

  • Explain the RBFT consensus mechanism, which is used in Hyperledger Indy. 

RBFT stands for Robust Byzantine Fault Tolerance (RBFT) and is inspired by Plenum Byzantine Fault Tolerance (Plenum). It has a pluggable election strategy, and it is set to a permissioned, voting based strategy by default. All instances do ordering, but the requests ordered by the master instance are actually executed. This consensus provides Byzantine fault tolerance. The only drawback is that the more nodes that exist on the network, the more time it takes to reach a consensus. 

  • Does Hyperledger use Proof-of-Work?

No, it does not use Proof-of-Work consensus, and this is the reason why it is fast and energy-efficient as well.

  • Explain what Hyperledger Explorer is?

This is a user-friendly web application tool that provides enterprise-level visualizations that helps decision-makers through intuitive graphs, tables, etc. It is used for viewing or invoking transactions and other crucial information stored in the ledger.

  • What is Hyperldger Caliper?

Caliper is a Blockchain performance benchmark tool for Besu, Fabric, Ethereum, and FISCO BCOS networks that allows users to measure the performance of a blockchain implementation with a set of predefined use cases. 

  • What is Hyperldger Cello?

Hyperledger Cello is a blockchain provision and operation system that aims to serve as the operational dashboard for Blockchain, which reduces the effort required for creating, managing, and using blockchains. 

Moreover, Cello manages the complete lifecycle of blockchain networks, supports customized blockchain network config, and extends with advanced features as well. 

  • What is Hyperledger Grid? 

Grid is a supply-chain-centric reference implementation solution. This project provides a set of modular components for developing smart contracts and client interfaces and also showcases how to combine components from the Hyperledger stack into a single, effective business solution.

  • What is Kafka in Hyperledger Fabric?

 It is a permissioned voting-based consensus mechanism where a leader does the ordering, and only in-sync replicas can be voted as a leader.

The advantage is that it provides crash fault tolerance, and finality happens in just a few seconds. The major drawback is that it is not Byzantine fault-tolerant, which prevents the system from reaching an agreement in the case of faulty nodes.

  • Mention some of the applications of Hyperledger Fabric.

  • Supply Chain Traceability 
  • Digital Identity
  • Real-estate Transactions
  • Music and Media Rights and much more.
  • What are the advantages of Hyperledger?

  • Permission membership
  • Performance, scalability, and levels of trust
  • Data on a need-to-know basis
  • Rich queries over an immutable distributed ledger
  • Protection of digital keys and sensitive data
  • Modular architecture supporting plug-in components
  • What is solidity? 

Solidity is an object-oriented programming language for writing smart contracts for several different Hyperledgers platforms.

  • What is Hyperledger Aries?

Aries is an infrastructure for peer-to-peer(P2P), blockchain-routed interactions. This project helps in the exchange of blockchain-based data that facilitates interoperable interaction between several distributed ledger technologies and other blockchains and supports P2P messaging in various situations.

  • Which is the best Hyperledger project according to you?

While all the projects are geared towards industrial use, selecting the appropriate framework is a matter of choice that varies as per business needs. Each frame has its features making it more beneficial for one niche while less serviceable for others. 

Concluding Lines: How to Learn and Become a Certified Hyperledger Professional 

If you are looking to upskill yourself in this technology, we are here to help you learn and become an industry-ready Professional. The certifications provided by the globally renowned online platform, Blockchain Council, give an in-depth knowledge of all the frameworks of Hyperledger.

The platform is known to provide the two most in-demand certifications, such as Certified Hyperledger Developer and Certified Hyperlegder Expert.

Certified Hyperledger Developer Training is excellently designed and carefully curated by experts to render a profound understanding of Hyperledger Fabric and Composer. Beginning right from the basics of Hyperledger Fabric to the fundamentals of Fabric architecture, the course covers all theoretical and practical aspects of this technology. 

Talking about Certified Hyperledger Expert, this certification will cover all the details regarding the architecture of Fabric and composer and will also help you to understand the hyperledger family, so you can begin building blockchain applications on top of the hyperledger platform.

So are you ready to open the world of excellent career opportunities in the Blockchain domain? If yes, why wait? Get enrolled in the Blockchain certification and become a Certified Blockchain Expert. 

To get instant updates about Blockchain Technology and to learn more about online blockchain certifications, check out Blockchain Council.

Top 30 Hyperledger Interview Questions for 2021

Source

Filed Under: blockchain technology Tagged With: article, blockchain, blockchain certification, blockchain council, blockchains, Business, Career, crypto, data, decentralization, decentralized, design, developers, Digital, distributed ledgers, Enterprise, ethereum, EVM, exchange, Family, fiat, healthcare, hyper ledger blockchain, Hyperledger, Hyperledger Fabric, Hyperledger project, information, Infrastructure, interview, Java, Ledger, Market, other, p2p, payments, Privacy, smart contract, smart contracts, Software, solidity, Tables, Technology, voting, world

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