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  • Despite China’s Ban, People Are Still Eager to Participate in ICOs

    Minimal launching costs and the ability to solicit crowdfunding from virtually anyone in the world with ease have been identified as the main reasons why startups are embracing the Initial Coin Offering (ICO) model as a fundraising method.

    Whether one represents an established organization or a group of college graduates with an innovative idea and little start-up capital, ICOs offer a level the playing field.

    ICOs are currently preferred to traditional methods

    President and Host at Blockchain TV, Jason Cassidy, explains that promising projects are taking the ICO route over the traditional venture capital path because of the low barriers to entry.

    Cassidy notes that the rules of engagement for ICOs are often set by the project team, giving them considerably more control. This is the opposite of the venture capital space, where the investor usually dictates the flow of negotiations.

    He elaborates, saying another important factor in the ICO boom is the relatively low cost to launch a successful crowdsale. ICOs are also raise capital much more quickly than the traditional funding routes, making it clear why projects often prefer Initial Coin Offerings.

    More ICO regulation is imminent

    However, Cassidy notes that as the industry grows, the level of difficulty for carrying out ICOs will increase due to imminent regulations by governments and institutions.

    Cassidy says:

    “Regulations are being put in place across the globe currently to bring a level of transparency and protection to the ICO model. As time goes on, more and more countries will bring forth regulations and the barriers of entry will increase, as will the quality of the ICO offerings that abide by the rules of those jurisdictions. Locales such as Zurich and Singapore are likely to become havens for ICOs given their friendly stance towards not only the crowdfunding model but the underlying technology itself.”

    Earlier this month, the Chinese government announced a ban on companies that were carrying out ICOs within its borders, ordering them to refund investors who contributed to such projects.

    This action by the Chinese government had a significant impact on the cryptocurrency market as the prices of token dropped sharply and many companies had to adjust their plans and programs.

    Even though the event came as a surprise to many in the industry, China-based Partner at Cryptocrest Dana Coe tells Cointelegraph that the development was nothing out of the ordinary:

    "To anyone who is familiar with Chinese law, this move to ban fundraising via ICOs comes as no surprise at all. China has long frowned upon "fund raising" activities within it's borders. I've consulted for several successful ICOs over the past months, and when they asked about bringing their ICOs to China, my advice was, ‘Forget it. They will land on you like a ton of bricks if you are perceived as doing free-lance fundraising in PRC.”

    He tells Cointelegraph that in China, events such as ICOs are illegal and the penalties are harsh.

    China effect is good for the industry

    According to Coe, the Chinese government has actually taken a rather soft touch in allowing these ICOs to just refund their customers and walk away. He notes that the fallout from China may be perceived as a setback, but given the possibility of shady ICOs harming the interests of consumers, and the reputation of cryptocurrencies as a whole, it is good to clean up the space. Coe elaborates:

    “I expect some sort of registration framework may be proposed for future ICO-like offerings. This way at the very least a responsible party is known to the regulators. People want to participate in ICOs, they can still do so, it is just they will have to be more circumspect about it by using only crypto.”

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  • Bitcoin Under Fire – Profit for Gold?

    Cryptocurrencies, especially Bitcoin, have flown a little too close to the sun recently, and it has seen them get burned by a few key monetary institutions, as well as governments. This attack on Bitcoin, as well as fear and speculation around other markets, could spell a good time for investment in gold.

    Seen as an insurance policy, gold has been a steady and safe investment for hundreds of years. As markets, beyond even the crypto market, get spooked, investors could see a safety net in the precious metal.

    Good time for gold

    While all the attention over the last few months or so has been solely aimed at digital currencies and their astronomical gains, gold has not been suffering, although many thought it would.

    Gold recently hit a new high of $1,350, and part of that was a $100 rise seen over three months for the steady commodity. It seems paltry for those who have been spoiled by swings as big as 25 percent in a day by digital currencies, but in its own right, it is a big jump.

    Essentially, that jump, and new high, was reason enough for gold to be no longer considered a bear market - and all this while Bitcoin was making its own massive gains.

    Why will gold profit from Bitcoin under fire?

    As Bitcoin was rising, so was gold, but when Bitcoin came under fire from China, and JP Morgan recently, gold profited even more.

    Gold was always seen as a safe and steady investment; not too much growth, but never really any decline. When sexy cryptocurrencies came along, with their 800 percent gains in less than a year, many put their funds into it.

    However, in the bad times, and for those investors who are a little more cautious, gold acts as a good insurance policy, as well as a reliable option to diversify with.

    Additionally, it only takes a relatively small number of investors around the world to decide to allocate five to 10 percent of their wealth to gold, to radically improve its valuation.

    Real world factors aiding gold’s appeal

    10 Reasons

    It’s not only Bitcoin that has talk of bubbles and uncertainty around it. The stock market has shown many times it has its propensity to pop, and there is a similar bubble feeling at the moment.

    The US stock market is already too high, and that has to do with a concentration of speculation into a very limited number of stocks in the NASDAQ. Lesser company stocks have already fallen.

    The dollar is also weakening, as it has done since its inception. But, it has its own factors to worry about. None more so than its country’s leader, Donald Trump. Trump, as well as his war of words - so far - for North Korea, is putting a lot of doubt into financial markets, making gold again appear to be the safest and steadiest option.

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  • Blockchain Powered AI Doctors to Revolutionize Medicine

    Doc.ai is hoping to revolutionize the medical industry by bringing AI doctors to all through their smartphones. Using Blockchain technology, the platform will be able to collect masses of medical data globally and generate insights from that information.

    Furthermore, through machine learning, the data collected will be analyzed and processed in order to provide personalized feedback to users about their own medical issues.

    Intersection of AI and Blockchain technology

    Doc.ai’s platform aims to provide users with the ability to essentially call on a doctor in their pocket. However, because medical practitioners are in short supply, difficult to access and expensive, this company is looking at powerful technologies rather than humans.

    The intermingling of the burgeoning technology of Artificial Intelligence and equally revolutionary Blockchain has seen Doc.ai’s team propose their platform can answer personal medical questions - from masses of data collected - at a touch of a button.

    "We are making it possible for lab tests to converse directly with patients by leveraging advanced artificial intelligence, medical data forensics, and the decentralized Blockchain. We envision extensive possibilities for the use of this technology by doctors, patients and medical institutions," comments Walter De Brouwer, founder and chief executive officer of doc.ai.

    The details of this platform may sound a lot like science fiction, but it is essentially the manipulation of data which is analyzed by machine learning, to provide medical answers.

    Doc.ai's AI technology is designed to use a decentralized, edge-learning network to develop insights based on personal data. An edge-learning network performs deep learning computations at the edge of the network or on a mobile device.

    Solving the healthcare problem

    It is plain to see that global healthcare is not in a good state. In fact, according to the World Health Organization, there is a shortage of over seven million physicians, nurses and other healthcare professionals worldwide, and the gap is widening.

    Doc.ai’s platform could have world-changing repercussions as patients with certain illnesses, or chronic problems can keep on top of their health concerns by utilizing AI doctors on their smartphones.

    Questions such as "What should be my optimal Ferritin value based on my iron storage deficiency?" or "How can I decrease my cholesterol in the next three weeks?" can all be answered and additional context given.

    This is done through insights gathered from personal medical data along The Neuron Network, which is their decentralized Blockchain.

    Incentivized learning

    Doc.ai will leverage the Blockchain in order to allow anyone to connect to the network and train their own AI. On this Neuron Network tokens will be used to incentivize, and provide data along it. Users will be rewarded as they train their AI, and furthermore, with these tokens, users can broadcast a competition on the network and create a prize for data scientists.

    When these succeed in building a prediction model that provides unique insights into the proposed personal quantified biology profile, the prize will be won through a smart contract.

    Investor support

    Pantera Capital and Anthony Di Iorio are among the early investors into Doc.ai, and Joey Krug, Pantera’s Co-CIO serves as an advisor to the company. Anthony Di Iorio is especially appreciative of the potential of the project, commenting “I am amazed by the potential that doc.ai technology has for millions of people all over the world and possible network effects of the NRN token."

    Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.

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  • Vitalik Buterin: Ethereum Will Have Visa-Scale Transaction Capacity in 2 Years

    Bitcoin, Ethereum and other high-profile cryptocurrencies are embroiled in debate these days, as companies and individuals seek other sources for transactions outside of simple fiat currency.

    Ethereum, the Blockchain technology-based application platform, has gained increasing popularity with developers and individuals alike. The platform is being utilized especially heavily with the ICO boom that has occurred in recent months.

    Buterin on the power of Ethereum

    Vitalik Buterin, speaking at TechCrunch Disrupt 2017, indicated that the platform has the capacity to change much of what is known about data and security. His comments included a strong indication that Ethereum will have the transactional power to equal Visa in the next two years. Buterin said:

    “Bitcoin is processing a bit less than three transactions per second. Ethereum is doing five a second. Uber gives 12 rides a second. It will take a couple of years for the Blockchain to replace Visa.” 

    Gaming platforms

    The Ethereum inventor also indicated that Blockchain technology will likely provide platforms for gaming and other data-intensive applications in the future, where security is an important aspect.

    “You could run StarCraft on the Blockchain. Those kinds of things are possible. High level of security and scalability allows all these various other things to be built on top. Ethereum is a secure base layer that doesn’t have too many features.”

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  • Satoshi’s Best Kept Secret: Why is There a 1 MB Limit to Bitcoin Block Size

    Anybody familiar with Bitcoin is aware of the vexing problem caused by the 1 MB blocksize limit and the controversy that arose over how to scale the network. It’s probably worthwhile to look back on how that limit came to exist, in hopes that future crises can be averted by a solid understanding of the past.

    A long time ago, in a land far away

    In 2010, when the blocksize limit was introduced, Bitcoin was radically different than today. Theymos, administrator of both the Bitcointalk forum and /r/bitcoin subreddit, said, among other things:

    • "No one anticipated pool mining, so we considered all miners to be full nodes and almost all full nodes to be miners.

    • I didn't anticipate ASICs, which cause too much mining centralization.

    • SPV is weaker than I thought. In reality, without the vast majority of the economy running full nodes, miners have every incentive to collude to break the network's rules in their favor.

    • The fee market doesn't actually work as I described and as Satoshi intended for economic reasons that take a few paragraphs to explain."

    It seems that late in 2010, Satoshi realized there had to be a maximum block size, otherwise some miners might produce bigger blocks than other miners were willing to accept, and the chain could split. Therefore, Satoshi inserted a 1 MB limit into the code.

    And he kept it a secret.

    Secret squirrels

    Yes, Satoshi kept this change a secret until the patch was deployed, and apparently asked those who discovered the code on their own to keep quiet. He likely kept things quiet to minimize the chances that an attacker would figure out how to use an unlimited blocksize to DOS the network.

    Theymos puts it:

    “Satoshi never used IRC, and he rarely explained his motivations for anything. In this case, he kept the change secret and told people who discovered it to keep it quiet until it was over with so that controversy or attackers wouldn't cause havok with the ongoing rule change.”

    It’s also likely that Satoshi never expected the 1 MB blocksize to be a problem. At the time, the average blocksize was orders of magnitude smaller than 1 MB, and it looked like there would be time enough to devise a solution. Satoshi himself said, of the blocksize limit:

    “We can phase in a change later if we get closer to needing it.”

    And again:

    “It can be phased in, like:

    if (blocknumber > 115000)

       maxblocksize = largerlimit

    It can start being in versions way ahead, so by the time it reaches that block number and goes into effect, the older versions that don't have it are already obsolete.

    When we're near the cutoff block number, I can put an alert to old versions to make sure they know they have to upgrade.”

    It’s apparent that Satoshi foresaw the removal of the blocksize limit as trivial and had no idea that such a minor code change would generate a firestorm.

    Foreseeable problems

    Bitcointalk user “kiba” presciently commented, shortly after the cap was created:

    “If we upgrade now, we don't have to convince as much people later if the bitcoin economy continues to grow.”

    In response to Satoshi’s comment that the limit could always be removed if necessary to support higher transaction capacity, Jeff Garzik pointed out:

    “IMO it's a marketing thing.  It's tough to get people to buy into a system, if the network is technically incapable of supporting high transaction rates.”

    Clearly the warnings were present.

    Why not bigger?

    Many have asked why Satoshi didn’t create a larger blocksize, like 8 MB. The answer is three-fold:

    • It wasn’t needed, as even 1 MB was far larger than the largest blocks that had ever been mined.

    • It was technically easy to change, simply substituting one value in the code for another.

    • Larger blocks create technical challenges.

    Back in 2010, Internet technology was such that larger blocks would not have propagated properly. In 2015, Theymos recalled:

    “One obvious and easy-to-understand issue is that in order to be a constructive network node, you need to quickly upload new blocks to many of your 8+ peers. So 8 MB blocks would require something very roughly like (8 MB * 8 bits * 7 peers) / 30 seconds = 15 Mbit/s upstream, which is an extraordinary upstream capacity. Since most people can't do this, the network (as it is currently designed) would fall apart from lack of upstream capacity: there wouldn't be enough total upload capacity for everyone to be able to download blocks in time, and the network would often go "out of sync" (causing stales and temporary splits in the global chain state).”

    Segregated Witness and Lightning Network

    Today’s Bitcoin uses a piece of code called Segregated Witness (SegWit) to separate signatures from transaction data, effectively allowing the network to “cheat” by creating larger blocks than 1 MB, yet still counting them as being below the cap. SegWit also fixes a vulnerability called transaction malleability, enabling the creation of something called the lightning network.

    The lightning network is envisioned as a way for Bitcoin users and/or merchants to open payment channels with one another in a secure and trustless fashion. Funds can be exchanged between these parties without the transactions being written to the Blockchain. This keeps the Blockchain small, capable of being served by reasonably powerful computers. The lightning network would periodically need to “anchor” to the main Bitcoin Blockchain, but would allow enormous increases in transaction capacity with very small increases in the size of the Blockchain.

    So far there is no working implementation of lightning network on mainnet, although there are versions on test net. Lightning network will be entirely optional, and users can choose to send ordinary transactions instead, if they so choose.

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  • Overstock CEO Patrick Byrne Answers Jamie Dimon’s Bitcoin Criticism

    Overstock CEO Patrick Byrne answered some of the issues that Jamie Dimon recently expressed regarding Bitcoin on an interview with Fox Business News.

    The head man at Overstock reminded viewers that Dimon is scared of Bitcoin, and has a vested interest in its failure. Byrne said:

    “Remember that a year-and-a-half ago, Jamie Dimon wrote a letter to shareholders saying ‘this is going to come eat our lunch.’ He was scared to death of it. I think what they thought was they could get in front of it and they are realizing they can’t get in front of it.” 

    Byrne’s comments reflect a growing sentiment that traditional banking platforms are frightened by the explosive growth and stability of Bitcoin. Other banking institutions have responded in similar ways, while businessmen in other markets have embraced the cryptocurrency. 

    Overstock leads

    The CEO also commented on the power of Blockchain technology for business, stating that Overstock has sought to be a front runner in adopting the disruptive technology.

    “What people are realizing about Blockchain is that you can take out about 90 percent of the back office costs of all kinds of mechanisms and banks and stock markets and such. That’s why Overstock has been sort of pioneering the application of Blockchain to Wall Street. You cannot only take out the cost, but you can also create a version of Wall Street where no one can cheat.” 

    Overstock has been one of the first companies to allow users to buy merchandise online with Bitcoin, and the company has even disclosed that it keeps funds in reserve in Bitcoin.

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  • Mexico to Join Club of Countries with Bitcoin Regulation

    Mexico, this month, will unveil proposed legislation aimed at regulating its fast-growing financial technology sector, including firms that use cryptocurrencies like Bitcoin.

    The bill seems to be aimed at protecting customers, as well as spurring competition in this burgeoning industry. Mexico is also hoping, in this bill, to ensure financial stability and defend against money laundering and financing of extremists.

    Massive potential growth in Latin America

    Mexico will be joining a small list of countries, which include the UK and the US who have actively sought to regulate not only cryptocurrencies, but also fintech companies.

    The hope for fintech companies is to try and crack a massive potential market as over half of Mexico’s 120 mln strong population are bank account-less.

    "This legislation recognizes the need that a sector as dynamic as that of technological innovation needs a regulatory framework that allows authorities to mitigate risks and allow for growth in a competitive environment," the bill draft says.

    What’s in the Bill?

    The Bill proposes to set out a clear set of rules pertaining to the running of fintech companies which will help reduce costs and drive competition in a sector that includes crowd-funders and payment firms.

    Additionally, there will be a section aimed at regulating companies that operate with digital currencies, such as Bitcoin. There is not too much detail on this, but it does say a lot of it will fall to the central bank to referee such actions.

    "The regulation is good news for all companies in this sector because ... growth will be greater with clear rules," said Luis Ruben Chavez, the founder of Mexican crowdfunding firm Yotepresto.

    Massive Mexican growth

    Mexico is a huge untapped market globally, and especially in Latin America where it leads the way.

    In 2015, the number of fintech companies came in at about 50, while year to date in 2017 there are already 2401 known companies in the new industry.

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  • First Bitcoin-Only Real Estate Transaction Completed in Texas

    Use cases for Bitcoin have been popping up everywhere, with new ‘Accepts Bitcoin’ signs on everything from coffee carts to retail stores in South Africa.

    These adoption cases are important as the continued use of Bitcoin will only increase the adoption and price cycle, commonly referred to as a Satoshi cycle.

    In a new and interesting twist, an entire real estate transaction has taken place via Bitcoin. In other words, you can now buy your house with Bitcoin…at least in Texas. The transaction was for the purchase of a newly built custom home, and the full purchase price was transferred to the seller/builder via Bitcoin. The seller then converted the coin into USD. The broker for the purchase said:

    "In all of my 33 years of closing transactions, I honestly couldn't have expected something so unique to go so smoothly. In a matter of 10 minutes, the Bitcoin was changed to US Dollars and the deal was done!”

    The purchase of the home as an agreement between buyer and seller represents another step toward widespread acceptance of the currency. Other companies are seeking to use tokenization of assets to allow smaller-scale real estate investment via Blockchain technology as well.

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  • SEC Will Stream Online Advisory Committee Meeting on Blockchain Technology

    The SEC has been much in the news of late for it’s strong stance on Blockchain technology and tokenization schemes. The government body notoriously issued a statement labeling the DAO token as a security, while at the same time the CFTC created a means for trading Bitcoin futures for LedgerX.

    The most recent announcement from the governing commission indicates that their investor advisory board will meet to discuss the ramifications of Blockchain and distributed ledgers and their impact on the securities markets. 

    The meeting is scheduled for October 12 from 9:30 AM to 3:10 PM at the SEC headquarters in Washington DC. The event will also be live streamed on the website, www.sec.gov. Those interested can visit and watch the events.

    The SEC has been influential in slowing the adoption of ICOs in the US, as their statements regarding the DAO have led to substantial concern over what is and is not a security in the token world. Other governments have recently followed suit, especially China, which has gone much further and banned all ICOs.

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  • JP Morgan Hates Bitcoin But Seeks Bitcoin, Blockchain Pros

    The scathing comments by Jamie Dimon regarding Bitcoin’s status as a ‘fraud’ were met with general disgust among the Bitcoin community. Others though agreed, embracing the commentary, as Bitcoin prices corrected sharply.

    However, later news sources indicated that, even as Dimon was spilling his anti-Bitcoin rhetoric, the company was ‘buying the dip’ as the price dropped to month lows.  

    Now, in another humorously ironic twist, the company has posted a job opening for a Blockchain professional as a ‘Technical Project Execution Manager’ dealing with distributed ledgers. The posting details included this interesting comment: 

    “The Blockchain Center of Excellence (BCOE) leads efforts for applications of distributed ledger technology (DLT) within J.P. Morgan. We are exploring Blockchain use cases and piloting solutions across business lines.  We are active in the Blockchain ecosystem: developing technology, investing in strategic partnerships and participating in industry consortia.” 

    Bitcoin has been variously hailed as a distributed and decentralized currency for the future and decried as a complete fraud. Nevertheless, in spite of recent negative news like Dimon’s comments and the Chinese Exchange ban, the cryptocurrency has continued to show stability, with prices climbing off the recent lows to settle around $4,000.

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