Wednesday, June 14, 2017

Bitcoin and Crypto Currency - The Evolving Landscape

Do not take this post as Investment advise. At best it is how I see the Crypto space after delving in it everyday for the last 4 years. It is clear now that bitcoin would never go to zero more so as adoption increases worldwide and it becomes more mainstream. Investment is all about value and timing, and of us will have different risk appetite.

Today (15/6/2017) total market capitalisation of all crypto coins and tokens is 110 Billion USD. It is actually incredible that something that is purely a result of computer hashing has aquired this amount of value. Over time there will be jostling for relevance and position among all the coins and some will increase in value while others will trend to irrelevance. That said it is becoming clearer how the coin landscape will settle.

The rise of Ethereum, debut of Zcash and finally the resolution of Bitcoin governance will clear the fog. Underlying every coin is it's utility as a currency. Every coin can be used as a currency, as long as there are people out there who are will to accept it in exchange for goods and services. Which coin is used in the transaction will then come down to how well the coins are distributed and how easy it is to transact in that coin.

The main currency coins are Zcash, Bitcoin, Litecoin and Dogecoin. Ethereum is not designed as a currency but more as a smart contract platform. It currently sits on the second spot in market capitalisation, I am skeptical about Ethereum because is it always just one step away from calamity and disaster. After the DAO, I believe that it would be virtually impossible to recover from another hack, code or user error disaster. That it has found a new use in ICO use is commendable but I really do wonder how that much monetary value can be place on an insecure platform. Quite irresponsible maybe even fraudulent and certainly greedy.

Bitcoin is the first and most secure platform. No coin can even come close to Bitcoin's security. However it has a serious flaw, which is fungibility. Bitcoin is pseudonymous. If a bitcoin address can be link an owner, all transaction from that address and owner is open for view and analysis. For most transactions this is not a problem but in the competitive commercial and sovereign sphere this is not acceptable. Other coins such as Monero and Dash aim to fill this function but it will find difficulty in gaining adoption partly because of security but mainly because most of the coins are held in very few hands. Zcash in my opinion will win the title of being the fungible coin.

Bitcoin has a value today of $2600 USD. As the market capitalisation of crypto coins increases and becomes more mainstream this valuation becomes less relevant. Among crypto coins Bitcoin will be the unit of measure and as more people worldwide use crypto rather than fiat the Btc/USD pair will become meaningless as the USD is an inflationary currency and subject to arbitrary devaluations. Bitcoin will become the unit of measure because it is the most secure coin and no other coin can ever come even close to it. Proof of Work (POW) is the only security that matters. Proof of Stake (POS) is just a rich man's game.

Zcash will be used as the high value transnational coin used by large corporation and nations. If I am right it will achieve a value higher than Bitcoin ie x number of Btc. I see this scenario developing because Zcash is a coin designed with privacy and fungibility foremost in mind. More important is the fact that by the way this coin was introduced no one person holds a large stash. It is very widely and thinly distributed. Zcash is the Platinum to Bitcoin Gold.

Over time (4 years) Zero Electric Coin Company will be the largest holder of Zcash. By then I can envisage nations and corporations holding shares in this company. In the meantime Zcash is very easy to mine on CPU's and GPU's. This will guarantee widespread mining adoption and even further distribution of the coin.

Litecoin will prove itself as highly utilised as a development platform. Litecoin is the Silver to Bitcoin gold.

Dogecoin will be the coin for everyday use. It's value is the number of coins in circulation currently around 109 billion and increasing by 10 billion a year. It has a large number of users and adopters already in place starting as a joke and tip coin.  The younger generation will start with this coin and there are also many lite Dogecoin wallets available on smartphones. Dogecoin is the Copper to Bitcoin Gold.

Sunday, March 19, 2017

Fear Not - The Chain Will Split But BTC is still the longest chain.

Update 28/7/2017

Looks like we will have a split. I am on the Satoshi chain that is the chain without Segwit.

As we are very close on the inevitable activation and mining of the first Bitcoin Unlimited block there is great fear and trepidation among the community that the event will result in a chain split.

I have come to the conclusion that this chain split will not occur, because deep down the people who finance Blockstream are rational businessmen. They will move their development to the BU chain.

Back when the bitcoin foundation was falling apart they saw a good opportunity to co-op the very best developers to control the development and upon it build their commercial platform, and they very nearly succeeded. Why do you think the developers were so exasperated that they tried so hard to get Roger Ver to support Segwit, through a series of debates, after they saw the possibility of what they thought was a foregone conclusion (Segwit activation), was slipping away?

I am sure that the total bitcoin holdings of all the people in Blockstream added together is less than that of Roger Ver. I will even venture further to say that all the developers receive their remuneration in fiat and they themselves admitted that they do not use bitcoin regularly. So why are they so desperate to get Segwit activated?

The people funding Blockstream will be savy businessmen and as such they would have dangled a carrot in front of the developers in the form of a bonus when Segwit activates. Normally as developers they would earn their considerable salary. My guess is that, if Segwit activates, they would be even better rewarded with cash and stock options. I too would be totally annoyed, if I see my chance of being a millionaire, slip sliding away.

I think that the chain will not split, because the only important thing to the investors is that their development is on the main chain. It will not matter which chain. Sure they would have more say and control if it is Segwit but even if it is BU their 2.0 platform investment is not lost. Since they also control Bitfury and BTCC they will move that hashing across. There might be some holdout with some developers keeping the smaller chain going but the hash rate will be so minuscule that it would only be academic and can easily be rendered useless. Mining at $1500 beats mining at $20 or less.

Roger being asked if he will endorse Segwit.
https://youtu.be/ZlBKMDQ957Q?t=54m

Tone Vs Roger
https://www.youtube.com/watch?v=XdyIJ-BUPaU

Johnny Vs Roger
https://www.youtube.com/watch?v=JarEszFY1WY&t=18s


Thursday, February 23, 2017

I need bitcoins now. PLEASE HELP!!

Buying some bitcoins is still very difficult. There is still so much to learn and understand about Bitcoin, but as the price is going up daily the panic and need to getting some bitcoins quickly gets more urgent and desperate.

The fastest and safest way to start owning bitcoin is to buy a mining contract from Genesis mining. https://www.genesis-mining.com/  You will receive a small amount bitcoins daily into your account.

Right now you can purchase 1 Tera Hash of mining power for $150 USD and you can charge it against your credit card. This will give you 0.00032 Btc a day which is about 38 cents USD. At this rate it will take more than a year to recoup your investment.

However 2 things are happening. 1 The price of bitcoin is still going up and is in a very strong bull phase. This means the bitcoins that are credited to your account will appreciate in value. Secondly as the price increase mining cost decreases which means a bigger payout until the mining difficulty catches up. Thirdly transaction fees are also becoming more significant which improves the possiblity of a higher payout. All these factors means that the payback time will be shorter than you think as long as the bull phase continues. The contract is non terminating meaning that you will continue to receive some bitcoin daily forever. Considering that transaction fees will replace new coins issues, this is possible.

If you want to just purchase cloud mining on Genesis Mining go to this link
https://www.genesis-mining.com  Use my affiliate code aOi345 and get 3.5% discount on your purchase. Purchasing cloud mining with your credit card is also a way to convert your fiat money into bitcoins quickly while you figure out other ways like Local bitcoins.






Tuesday, January 10, 2017

India's Demonetization Is A Success And Bodes Well For Bitcoin and the Digital Economy.

On the 8th November 2016 when Modi cancelled the 500 and 1000 rupee notes, and gave the populace 50 days to exchange old notes for new legal tender, the international press condemned and vilified the move. One must ask if they really had India's best interest at heart.

By any measure this demonetization effort has been a success. India is a country where at every election people die. Yet this unanticipated move was without protest and practically bloodless. In one move Modi have dragged his backward and feudal people screaming and kicking into the 21st century and internet banking. I would consider this one move to be the awakening of the Indian tiger.

We can be sure that every Indian young or old, male or female would now know of Modi Narendra and what he did for India. ( I would lay bets that there are people in the USA who don't know who Obama is or that Trump is the president elect.) By financially empowering every Indian with an awareness of the knowledge economy he will move India forward faster than with any other development route possible.

Bitcoin companies like Zebpay, Unocoin and Coinsecure have mushroomed in member and users and a system like Africa's Mpesa may not be too far off. Hopefully their system will not be monopolise by some giant telco like Safari-com in Kenya, choking of competition and development.

India is on-boarding users to bitcoin at a rate of over 100,000 a month. Such growth cannot be ignored by governments of the world at large. The only question now is, which country will be the first to adopt bitcoin as a national currency. The one that does will be a very rich country indeed going forward.  

Monday, January 2, 2017

Growing your bitcoin stash - now is the time using, "The Magic Of Compound Interest".

How to use the most powerful tool in finance to grow your bitcoin stash.

I came across Bitcoin in December 2013 and bought my first bitcoin in February 2014. I was very hard to buy bitcoins in those days. Over the next 3 years I have made and lost bitcoins checking out project and getting caught in several scams and outright exchange failures.

Investing in bitcoin
For the newbie just purchasing your fist bitcoin or part of it is a great experience. Most will get it directly from a friend, at a meetup from a bitcoin ATM or a bitcoin exchange. After that it's a case of adding to your stash on a regular basis or buying when price action starts to happen again as it does every few months. The biggest one in my experience is the run-up from $237 to $1020 in just over a year.

The Magic of Compound interest.
With compound interest we double our principle in just 7 years at 10%. The idea is to utilise this principle to our benefit. If you only want to make a one off capital investment your options are.

1) Purchase bitcoin
2) Purchase hardware to mine bitcoin
3) Purchase cloud mining contract - Use the most reputed Genesis mining
4) Purchase Ghash units on Hashnest

Of the above purchasing bitcoin outright and holding is the quickest and safest. Mining for bitcoin will require you to have some computer knowledge and the return is often less than your investment. On average it will take a year to recover your investment as the ROI decreases with every difficulty increase. Cloud mining contract is similar to purchasing your own miner except it cost more and takes even longer to recover your investment. Lastly is what we are talking about utlilsing hashnest hashing units purchases.

Go to Hashnest  https://www.hashnest.com  sign up for an account, deposit some bitcoin and purchase either AntS7 hashes or AntS9 hashes. The advantage of this system is that you can easily convert your hashes into bitcoin anytime you choose. All you do after this is keep reinvesting your daily dividends. Using this process you will double your capital investment in six months. The return is about 0.4%  compounded daily. Always keep an eye on bitcoin price trends and exit when you feel uncomfortable. Getting in and out and switching between AntS7 and AntS9 is fun, Best of all your liability is limited and worst case you get to keep your mining hardware.

Caveat : This assumes that the price of bitcoin and hashing difficulty remains constant which is not. As difficulty increase your return and price of hashes will decrease. It is counter balance by the increase in price of bitcoin. If mining of hashes becomes unprofitable for 10 days in a row, the market will close and you can claim the physical miners and get them shipped to you. At time of writing 3/1/2017 the price of bitcoin have been increasing and so this has been a very good strategy.

If you want to just purchase cloud mining on Genesis Mining go to this link
https://www.genesis-mining.com  Use my affiliate code aOi345 and get 3.5% discount on your purchase. Purchasing cloud mining with your credit card is also a way to convert your fiat into bitcoins.

Get A Coinbase Wallet and purchase your first bitcoin using your credit card.



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