Fran Strajnar, 15 Oct 2015 - Adoption, Blockchain, Technology As detailed in many of our weekly reports and past newsletters, lines are being drawn in the sand by those in the Blockchain Protocol Wars.This week was huge, with several product/protocol announcements from well funded FinTech companies working with Blockchain Technology.A very important release took place a few days ago: Blockstream released its first functioning product called "Liquid," which is looking to simplify the transfer of bitcoins between participating exchanges.This sidechain project’s success is critical on several levels.First it will show the financial world that private blockchains can be attached to the bitcoin protocol, through 2 way pegs.More importantly, it should solve a major liquidity problem that currently affects every exchange.The ability to share liquidity between exchanges would prevent catastrophic price drops due to a single large trader and also situations like margin calls as we saw on Bitfinex in late August.

In addition this will reduce arbitrage opportunities between exchanges and make pricing more efficient.Please note: Blockstream's Liquid Protocol - Shares a similar name but has nothing to do with our 'Bitcoin Liquid Index' also known as "BNC-BLX".(This is the comprehensive historic price-index for bitcoin, also available as a live feed for settlements, and is available for institutional use today).Enterprise Blockchain Middleware:In addition to the announcement from Blockstream, another interesting release this week came from Ripple (formerly Ripple Labs) with a new protocol “Interledger.” Interledger is designed to be a connector between other ledgers, whether they are traditional fiat currencies or crypto currencies.This could turn out to be a very critical piece of technology that directly influences the work being done by R3CEV, Hyperledger and Chain to name a few.It may also influence, and perhaps facilitate, transfers between fiat ledgers (or accounts) and the bitcoin ledger.Businesses are still having a hard time getting banking relationships, even from the banks that seem to be investing in Blockchain Technology.What Ripple appears to be doing is very smart.

They are setting up their private token system to interact with other ledgers, even those that have yet to be made.By making Interledger a protocol, Ripple may have provided a bridge for many useful applications.In a way they might be levelling the playing field, and if this protocol gets utilized it brings a lot of confidence to the Ripple tokens and the private Blockchain that secures them.How Blockchain technology can be applied within the traditional financial institutions continues to be the theme.Some time next year we expect this paradigm challenged, as more and more technology companies continue to move into the financial space.In the mean time, we continue to look for critical news on who can provide the first functioning private Blockchain.For full updates on; Regulation, Blockchain Trends, Bitcoin Technical Analysis, Bitcoin Market Activity, Events & Resources, Please check out our detailed weekly - reports if you haven't already.Bitcoin just crashed 50% today, on news that the Chinese government has banned local exchanges from accepting deposits in Yuan.

BtC was trading over $1000 yesterday; now it's down to $500 and still falling.bitcoin average eurI want Bitcoin to die in a fire: this is a start, but it's not sufficient.sell bitcoin berlinLet me give you a round-up below the cut.bitcoin gefahrenLike all currency systems, Bitcoin comes with an implicit political agenda attached.bitcoin bear etfDecisions we take about how to manage money, taxation, and the economy have consequences: by its consequences you may judge a finance system.bitcoin kaufen schweizOur current global system is pretty crap, but I submit that Bitcoin is worst.bitcoin trustworthy

For starters, BtC is inherently deflationary.download bitcoin wallet windows 7There is an upper limit on the number of bitcoins that can ever be created ('mined', in the jargon: new bitcoins are created by carrying out mathematical operations which become progressively harder as the bitcoin space is explored—like calculating ever-larger prime numbers, they get further apart).bitcoin calculator wikiThis means the the cost of generating new Bitcoins rises over time, so that the value of Bitcoins rise relative to the available goods and services in the market.ethereum depositLess money chasing stuff; less cash for everybody to spend (as the supply of stuff out-grows the supply of money).Hint: Deflation and Inflation are two very different things; in particular, deflation is not the opposite of inflation (although you can't have both deflation and inflation simultaneously—you get one disease or the other).

Bitcoin is designed to be verifiable (forgery-resistant) but pretty much untraceable, and very easy to hide.Easier than a bunch of gold coins, anyway.And easier to ship to the opposite side of the planet at the push of a button.Libertarians love it because it pushes the same buttons as their gold fetish and it doesn't look like a "Fiat currency".You can visualize it as some kind of scarce precious data resource, sort of a digital equivalent of gold.Nation-states don't control the supply of it, so it promises to bypass central banks.But there are a number of huge down-sides.Here's a link-farm to the high points: Mining BtC has a carbon footprint from hell (as they get more computationally expensive to generate, electricity consumption soars).This essay has some questionable numbers, but the underlying principle is sound.Bitcoin mining software is now being distributed as malware because using someone else's computer to mine BitCoins is easier than buying a farm of your own mining hardware.

Bitcoin violates Gresham's law: Stolen electricity will drive out honest mining.(So the greatest benefits accrue to the most ruthless criminals.)Bitcoin's utter lack of regulation permits really hideous markets to emerge, in commodities like assassination (and drugs and child pornography).It's also inherently damaging to the fabric of civil society.You think our wonderful investment bankers aren't paying their fair share of taxes?Bitcoin is pretty much designed for tax evasion.Moreover, The Gini coefficient of the Bitcoin economy is ghastly, and getting worse, to an extent that makes a sub-Saharan African kleptocracy look like a socialist utopia, and the "if this goes on" linear extrapolations imply that BtC will badly damage stable governance, not to mention redistributive taxation systems and social security/pension nets if its value continues to soar (as it seems designed to do due to its deflationary properties).To editorialize briefly, BitCoin looks like it was designed as a weapon intended to damage central banking and money issuing banks, with a Libertarian political agenda in mind—to damage states ability to collect tax and monitor their citizens financial transactions.