This is a sort of post I do on FreeTheAnimal sometimes. Generally, it means my post idea queue has become so burdened that it requires a house cleaning dump. Which means: get at least some of the info out before it's outdated. And news moves fast in crypto...
The Big News
Well, that would be the chart, above. The Satoshi Bubble Since 2009 broke $8,000 this morning. What's most remarkable is that it was trading under $6,000 just a week ago. Unprecedented—perhaps not in percentage terms, but that's a lot of bucks.
...I finally got my wife to pop for a $250 BTC stake last week in her own account, her own wallet, portfolios set up. She got in about $6,200, so she's pretty jazzed. Almost a believer.
Be Careful How Secure You Want to Be
You just might get so secure that even you can't get to your funds.
I spent all morning yesterday trying to wrap my mind around the story of how users of the Parity Wallet in it's multi-signature configuration, got tons of Ethereum frozen. Estimates range from $150 - $300 million worth. Note, not stolen, frozen. That is, it's still there, but they've sawed off the limb they were 'secure' on, and they broke it.
Too smart by half?
Since I spent so much time and effort really getting my mind around crypto wallets so you don't have to, this was a very curious thing for me. It wasn't in an exchange; it wasn't in a web wallet; it wasn't hacked or stolen...yet a bunch of folks find themselves in an obviously stressful situation.
Here's the best explanation I could find yesterday: The $280M Ethereum’s Parity bug.
The newly deployed contract [...] contains a vulnerability where its owner was uninitialized. Although, the contract is a library it was possible for devops199 to turn it into a regular multi-sig wallet since for Ethereum there is no real distinction between accounts, libraries, and contracts.
The event occurred in two transactions, a first one to take over the library and a second one to kill the library — which was used by all multi-sig wallets created after the 20th of July.
So the way I understand it—and I could be wrong—is that in order to gain "greater security" over a standard single private key, it's an Ethereum "smart" contract that requires multiple parties to digitally sign a transaction before it goes through—something desired by institutions so the bookeeper can't embezzle all your coin.
So, in order to overcome the "limitation" of a single private key, it's wrapped up in a single contract that's the same contract for all like kind multi-sig wallets, and so if you break the contract, everyone is broken.
No effect on single private key wallets, however, so this is not FUD.
...Seems viable that they would be able to recover the funds with a hard fork. We'll see.
First World Luxury Problems
Now, some bitcoin platforms are reaching their limits amid the cryptocurrency euphoria, according to an industry expert who has examined the venues. While declining to single out a particular exchange, the person said the venues generally haven’t been stress tested. Although systems upgrades are underway, best practices in the field are far from standardized.
Where would we be without hand-wringing experts spreading FUD all the time?
The Satoshi Revolution
Are you keeping up with Wendy McElroy's weekly dissemination of her book on Coindesk?
I hope so. I've been following that feminist-anarchist for about 2 decades and she's a pretty smart individual.
LEAP Options on Bitcoin
I love this. Not only will crypto hedge funds love it too, standard hedge funds are going to use it too.
LedgerX just initiated its first long-term bitcoin futures option.
Called a Long-Term Equity Anticipation Security (LEAPS), the trade was matched by the platform this morning and is set to expire on December 28, 2018.
Under the terms of the deal, the buyer has the right to buy bitcoin at a price of $10,000 at that date, or almost a 30 percent premium on today's price.
The first one purchased traded for $2,250.25. This means that for that price today, you can be guaranteed to buy a Bitcoin for $10,000 13 months and 2 weeks from now. It took a week to just go from $6-8K.
I'd take that deal. Unfortunately, it's for institutions or high-net-worth individuals, presently. You can follow the data here.
I had no idea what to expect but seeing that there are apparently a lot of crypto enthusiasts on what is essentially a platform for gamers (I'm not a gamer...my 5-yr-old Xbox 360 has been used maybe 4 times), I set it up and did an announcement post yesterday.
I'm pretty sure that in order to use it, you've got to first create an account. Once that's done, you need to link your Patreon account to it, and it automatically takes care of the rest to get you access to the Patron-only areas. So, essentially, same thing as here. No trolls, only this same community using a different communication platform.
So, it's way more robust than Patreon for real-time stuff. For instance, that little convo showing in the image is Dave Seng telling me he was able to snag IOTA at Binance, which must be a new thing. My free xfer of BTC from GDAX to my newly-created Binance account (a cinch...1 minute) is in waiting.
I'll get a $100 stake to start.
....And, here's the other thing. It has live voice chat. Mark Johnson and I tested it out, with Dave listening in.
So, I'm working out a way to have and schedule regular live chats, like Q&As, discussions, etc. You might want to get onboard. Initially, I've sert up the following Patron-only channels:
So, get on it. How do I get my Discord Rewards?
Over the next week, I'm going to put up two polls, maybe more.
- Are you in the crypto market Y/N?
- If you're not in the crypto markets, what is your chief obstacle? (a list of choices or other, explain in comments).
I'm realizing that in order to accomplish my primary goal of getting as many possible to have the knowledge necessary and get going on it already, I need more data so I can channel my efforts here most effectively, most beneficially for the most Patrons.
UPDATE: This is just an hour or so after posting, but yet again, I see more concern about Bitfinex (Google around). I've never had an account and though I included it in the original trading guide, soon found out they had closed off US customers a while back and updated it accordingly. At this point, I'm removing it entirely from the trading guide along with a warning that I explicitly recommend not using it.
See The Cryptocurrency Resource Library — A Complete Up-To-Date Index of All The Most Important Stuff.