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Chickcoin? Introducing the ‘KFC Bitcoin Bucket’

 1 min read / 

KFC has said it will allow customers to use cryptocurrency, bitcoin, to purchase food.

The “Bitcoin Bucket” will be exclusively available to those living in Canada using the cryptocurrency to pay for deliveries.

The Canadian branch of the fried chicken chain announced the news on Thursday via social media.

Following the announcement, the fast-food chain started a real-time price tracker for how many bitcoins would be needed to buy a bucket of chicken. KFC has announced however that it will be pegging the bucket to $20, presently worth 0.00144 of a bitcoin.

KFC’s Twitter account said: “Sure, we don’t know exactly what Bitcoins are, or how they work, but that shouldn’t come between you and some finger lickin’ good chicken.”

Despite the obviously welcome news to many chicken lovers, this is also proof that bitcoin is entering the mainstream economy. Some have criticised KFC for using the cryptocurrency for a publicity stunt, but it seems that a form of tender originally meant to undercut the state-backed counterparts is becoming accepted by international bodies.

With some concerned that the present obsession with bitcoin suggests a crypto-bubble, the fact that it is starting to developing an everyday use suggests bitcoin could remain a highly sought-after commodity.

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Cryptocurrencies

IOTA, the Tangle and the Future

 5 min read / 

iota tangle

Back in November, rumours of a “partnership” between IOTA and Microsoft caused the price of MIOTA to shoot above $5. Following the recent crypto-crash, however, MIOTA is currently trading at around the $3, up from recent lows of about $2.

Whether they’re day trading, HODLing or simply interested in the technology, many crypto-enthusiasts want to know how high IOTA can go.

The Internet of Things

IOTA (which stands for “Internet of Things Application”) has been touted as a “cryptocurrency of the future”, which supposedly solves the scalability problem that is plaguing some of its larger peers.

IOTA’s developer team are trying to capitalise on the imminent boom in the number of connected smart devices that are going to hit the market in the next 10 or so years. Some estimates put the figure as high as 50bn, which when you consider the proliferation of smartphones and computers, as well as newer products such as smart watches and various home devices, is not that hard to believe.

This increase in smart devices is due to lead to an exponential increase in the number of micro-transactions that take place at any moment. Already, nearly all new software companies have transitioned to a SaaS (software as a service) model, which means customers make repeated payments for the product. Netflix and Spotify exemplify this trend.

As more and more businesses transition towards offering some kind of service, costs are going to be pushed lower, causing the number of micro-transactions to soar. Micro-transactions are typically defined as anything below $0.75 but, as the Internet of Things plays out, could well be far lower.

IOTA aims to facilitate this huge increase in micro-transactions through its “Tangle”.

The Tangle

Whereas most cryptocurrencies rely on some form of blockchain technology, IOTA’s developers use the Tangle. Rather than have miners solve cryptographic puzzles to verify new blocks, the Tangle is block-less and requires no miners.

The lack of miners means that there is no centralisation of the Tangle. Ironically, while many cryptocurrencies claim that they are decentralised, there is, in reality, a political and economic centralisation around miners. In response, some cryptocurrencies are moving away from established Proof-of-Work protocols and towards Proof-of-Stake ones, which will tackle this centralisation problem.

Proof-of-Stake protocols enable blocks to be verified by a population of token- or coin-holders who store their digital assets in special wallets. Therefore, stakeholders will already have skin in the game, and will not be people who purchase hardware for the sole purpose of profiting from mining. However, even in this scenario, there is some degree of centralisation as decisions are made in proportion to a stakeholder’s holding.

In the Tangle, there is no separate mining, whether by Proof-of-Work or Proof-of-Stake. Instead, anyone who executes a transaction on the Tangle will automatically verify two further transactions. This has the additional benefit of speeding up the network the more one uses it.

It All Comes Down to Fees

The Tangle also sets itself apart because it has feeless payments, which in turn facilitate micropayments. After all, who would pay for a coffee in bitcoin when the transaction fee itself might be 10 times the cost of the beverage; the fee for a micro-transaction could easily be 100 times its cost.

Since miners need to be reimbursed and then rewarded for their efforts, transaction fees are charged by most blockchain systems. However, since transactions on the Tangle are verified by users and not miners, there is no direct need for IOTA to charge a transaction fee. Therefore, micro-payments and IOTA are a seemingly natural fit.

What Next?

On paper at least, IOTA not only enables micro-transactions, it increases the scope for companies to engage in B2B activity by monetising more of their resources. In theory, companies could charge seemingly irrelevant fees for API access, which could then be passed onto consumers who might well never realise the cost.

Furthermore, IOTA has the potential to be truly decentralised because of how it does not discriminate between transaction issuers and transaction approvers, thereby reducing the scope for conflicts between parties and wasted time or resources. In the last six months, bitcoin has had two major hard forks, which have seriously ruptured its developer community, if not necessarily its price.

IOTA is already being used in a number of ways, including electric vehicle charging and parking; all in all, over $10bn has been transacted across its network. Aside from Microsoft, IOTA’s potential has been noticed by other big tech players such as Amazon and (if rumours are to be believed) Tesla. Although these reported “partnerships” are yet to be confirmed, industry interest can only be a good sign going forward.

Developers, Developers, Developers

Although IOTA’s team have made some big promises, its future is determined by its developer team. Despite how innovative IOTA’s technology is, CoinGecko.com rates its developer team at just 68%, putting it behind even Dogecoin (whose founder recently called his project a “joke”).

Furthermore, last summer, there were serious concerns over IOTA’s wallet, which was beset by glitches that often displayed a balance of zero despite users holding MIOTA. Although this has since been resolved, the episode does somewhat stain the reputation of IOTA’s team.

Nevertheless, IOTA has continued to climb and has grown into one of the major cryptocurrency players. Regardless of past issues, everything is still to play for. At recent events, IOTA’s team have announced that they are in conversations with several national banks about the potential use of their system.

Should IOTA pull off some of these corporate and national partnerships – as well as deliver on its technological promises – IOTA’s market cap might one day rival that of Ethereum or even bitcoin.

 

Keep reading |  5 min read

Cryptocurrencies

Two New Blockchain ETFs, So What?

 4 min read / 

New Blockchain ETFs

With the recent failure to get cryptocurrency Exchange-Traded Funds (ETFs) up and trading, the Nasdaq has listed ETFs this week by two companies that have shifted their focus to building portfolios of publicly listed companies with their hands in blockchain technology.

On its face, this might seem like exciting news for blockchain and crypto enthusiasts looking to get some investment exposure in the technology. However, anyone reading the headlines should temper their expectations upon a deeper look.

What are They?

The two ETFs that are now trading on the Nasdaq are listed under the stock tickers (BLOK) and (BLCN).

BLOK is an actively managed portfolio run by the company Amplify ETFs. Under Amplify’s original registration statement prospectus with the Securities and Exchange Commision (SEC), the ETF was originally going to be called Amplify Blockchain Leaders ETF.

However, with good reason, the SEC was cautious to allow the fund to be listed with blockchain in its name over fear of having its stock price increase exponentially. Thus, Amplify settled on the name “Amplify Transformational Data Sharing ETF.” Since BLOK is actively managed, as opposed to its counterpart BLCN, the fund claims that this style of management will allow the fund to actively respond in real-time to blockchain related events and news such as IPOs, acquisitions, partnerships and strategic announcements, which could have an impact on the valuations of companies in the blockchain space. Amplify defines BLOK as a portfolio of “publicly-traded global equities actively involved in blockchain technology via investment, research or revenue creation.”

So, what are you buying if you decide to invest in the BLOK ETF? Well, many brand name tech companies that aren’t necessarily directly impacted all that much by blockchain technology. BLOK’s top holdings consist of giant tech companies such as IBM, Microsoft, Intel and NVIDIA, the e-commerce site Overstock.com, a payment processor Square, and the banking conglomerates Citigroup and Goldman Sachs.

Of those listed, only a few actually have heavy investments in blockchain. The two leaders being IBM, which has a department of 1,500 employees dedicated to blockchain technology, and Overstock.com, which is quickly transitioning from an e-commerce to a blockchain Bitcoin company.  That is not to say that these companies can’t indirectly benefit from the developments of blockchain and the growing popularity of cryptocurrencies.

For example, NVIDIA’s stock price has increased by over 400% in the last 2 years because of the strong demand for its graphics processor units (GPUs). NVIDIA’s GPUs are among the most popular computer chips used by cryptocurrency miners who are looking to get rich and act as nodes for blockchain networks such as bitcoin. In fact, all of the holdings of BLOK do in some capacity have exposure to blockchain – although some are slight. However, any investor wanting to gain real exposure to the technology should look elsewhere, because the ETF resembles something more of a tech ETF, with some random payment processors and banks thrown in the mix, than an actual blockchain ETF.

Unfortunately, BLCN hasn’t distinguished itself from BLOK and a real blockchain ETF. BLCN is a passively managed ETF from the company Reality Shares ETF. Reality ran into similar trouble with the word blockchain being in its original name, Reality Shares NASDAQ Economy ETF, in its registration statement prospectus with the SEC. Reality settled on the name “Reality Shares Nasdaq NextGen Economy ETF.” Unlike its counterpart BLOK, BLCN is a passive index tracked ETF that will track an index, similar to the S&P 500, on the NASDAQ and will not be actively managed.  The holdings in the index are very similar to the current holdings of BLOK, and features names such as IBM, Overstock.com, Intel, Microsoft, and NVIDIA. This leaves investors without real hard blockchain exposure.

Final Thoughts

Even though the two new ETFs aren’t exactly what blockchain enthusiasts were hoping for in terms of gaining easy access and a more diversified exposure to companies that are specifically focused on blockchain tech, it is a good start for those looking to perhaps dip their toes in the water of the blockchain world. However, it still remains that, outside of investing in the Bitcoin Investment Trust from Grayscale traded under the ticker GBTC, purchasing bitcoin and other cryptocurrencies outright on Coinbase or a purely crypto exchange like Bittrex or Binance is the only way to get a true exposure to blockchain and the crypto economic world.

Keep reading |  4 min read

Cryptocurrencies

Cryptos Rally Slightly

crypto prices

Following one of the worst crypto crashes since 2015, cryptocurrencies posted moderate recoveries.

Editor’s Remarks: Bitcoin dipped into four-figure territory at the nadir of the short-lived crash that many touted as the “end of cryptocurrencies”. However, most major currencies were up yesterday as they commenced a recovery. Ripple, which fell as low as $0.90, was up to $1.40 by midday, while NEO resumed its upward trend. Bitcoin’s recovery has been notably weaker than its smaller cousins, some of whom are up 60% in the last 24 hours against bitcoin. Ethereum gained back some of the ground it lost too and is settling in once more above the $1,000 mark.

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Keep reading |  1 min read

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