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Cryptocurrency exchanges look to speed up bitcoin transactions



Two of the biggest cryptocurrency exchanges are aiming to make bitcoin transactions faster and cheaper with a new software update announced this week.

Both Coinbase and Bitfinex said they are adopting a software called SegWit, which bitcoin bulls and one exchange say should lower fees by as much as 20 percent while speeding up transactions.

“The most noticeable changes in the short term should be more efficiency when transacting,” said Alex Sunnarborg, founding partner at crypto hedge fund Tetras Capital. “SegWit adoption is undoubtedly positive for bitcoin as it greatly impacts transaction fees, speed, and future tech possibilities, all areas in which alternative crypto assets like Bitcoin Cash and Ethereum compete with and often criticize bitcoin on.”

Bitcoin enthusiasts have split over the best way to improve the cryptocurrency network’s efficiency. An upgrade called SegWit2x was called off in the fall after it lost widespread support.

Meanwhile, bitcoin transaction fees soared well above $20 in the last few months and confirmation times could take longer than a day. Some users were so frustrated with fees, and unable to compromise on blockchain size increases, that they “forked” bitcoin, and created bitcoin cash this summer.

Source: BitinfoCharts

The software Segregated Witness, or SegWit, slightly increases the block size. As the number of transactions that fit into each block goes up, transactions get faster. SegWit went live in August as Bitcoin’s skyrocketing popularity led to some slowdowns on the network.

Bitfinex, which facilitates about 38 percent of all U.S. dollar-bitcoin trading volume according to CryptoCompare, announced the software roll-out on Tuesday.

“We are delighted that through this implementation we can provide our customers with bitcoin withdrawal fees that are up to 20 percent lower, as well as faster-than-ever transaction speeds,” Bitfinex Chief Technology Officer Paolo Ardoino said in a statement.

San Francisco-based exchange Coinbase, which does 17 percent of all U.S. dollar bitcoin trading volume according to CryptoCompare, also tweeted the software update this week. The first phase will kick off this week, and should be fully available by the middle of next week, the company tweeted Tuesday.

Bitcoin prices shrugged off the news, and fell 7 percent Wednesday, trading near $10,500. The cryptocurrency is down more than 40 percent year to date. Ethereum dropped more than 4 percent, trading near $832, and is down 37 percent year to date.

The software news could mean more for long-term sentiment than short-term prices, said Brian Kelly, CNBC contributor and CEO of BKCM.

“It’s very good for the ecosystem,” Kelly said. “We’re making progress on the technology front, that takes the criticism that fees are too high out of picture.”

Ethereum bull Benjamin Roberts agreed that the software update is a positive long-term sign for bitcoin, adding that more people may be open to the cryptocurrency if transaction fees fell. But it still remains to be seen if the update alone is “enough,” he said.

“It’s an incremental improvement,” said Roberts, founder and CEO of Citizen Hex. “It’s good that different players are adopting the changes but it’s a very small step on the way to what needs to be a significant improvement.”

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Biden inauguration Day: Europe cherishes Trump’s departure



European Commission President Ursula Von Der Leyen addresses European lawmakers on the inauguration of the new President of the United States.


LONDON — The European Union is rejoicing the arrival of President-elect Joe Biden after four fractious years under the leadership of Donald Trump.

Just hours before the President-elect takes an oath to serve as the 46th President of the United States, European officials were not afraid of expressing their happiness at Biden’s forthcoming inauguration and ambitions for the new administration. 

“This day brings good news: The United States is back and Europe stands ready to reconnect with an old and trusted partner,” Ursula von der Leyen, the president of the European Commission said on Wednesday.

“Joe Biden’s oath will be a message of healing for a deeply divided nation and it will be a message of hope to a world waiting for the U.S. to be back in the circle of like-minded states,” von der Leyen also said in Brussels, adding that “after four long years, Europe has a friend in the White House.”

The U.S. and the EU have been at odds over several issues, from international trade to climate change, since President Trump arrived at the White House in January 2017. The president’s combative style and unilateral actions were not welcomed by European officials, who were used to coordinating some policies with the United States. 

However, the EU is hoping that a Biden administration will mean more cooperation going forward.

“It is more than a transition, it is an opportunity to rejuvenate the transatlantic relationship,” Charles Michel, European Council president, said on Wednesday.

The European Union announced in December a plan on how to improve the transatlantic relationship. This is focused on four major policy areas: health response, climate change, trade and tech, and security.

But European officials are also aware that when it comes to digital taxation, for instance, it might be hard to reach an agreement overnight.

“We have our differences and they will not magically disappear,” Michel also said at the European Parliament.

Earlier this week, European finance ministers discussed with the former economic advisor to the Obama administration, Larry Summers, the future of the transatlantic relationship.

According to one EU official, who did not want to be named due to the sensitivity of the talks, Summers said this will be the first time since the fall of the Berlin Wall that there will be such a close relationship between the U.S. and the EU.

However, Summers also tried to manage expectations, suggesting that it may take a bit longer than expected for the new administration to settle in and appoint all the necessary officials it needs.

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Oaktree’s Howard Marks on unrealized capital gains tax, Janet Yellen



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India has reportedly asked WhatsApp to withdraw privacy policy update



The WhatsApp messaging app is displayed on an Apple iPhone on May 14, 2019 in San Anselmo, California. Facebook owned messaging app WhatsApp announced a cybersecurity breach that makes users vulnerable to malicious spyware installation iPhone and Android smartphones. WhatsApp is encouraging its 1.5 billion users to update the app as soon as possible.

Justin Sullivan | Getty Images News | Getty Images

India’s technology ministry has asked Facebook-owned messaging giant WhatsApp to withdraw planned changes to its privacy policy that has drawn widespread backlash, multiple media outlets reported.

In an email addressed to WhatsApp chief Will Cathcart dated Jan. 18, the Ministry of Electronics and Information Technology said the proposed changes raised “grave concerns” over the implications for choice and autonomy of Indian citizens, Reuters reported.

The update relates specifically to features that allow users to interact with businesses on WhatsApp.

The ministry reportedly said it was worried about the lack of choice Indian users had over opting out of WhatsApp’s planned policy update compared with those in Europe, where data protection rules are more stringent. The tech ministry reportedly called it “discriminatory treatment” that “betrays a lack of respect for the rights and interest of Indian citizens.”

“Therefore, you are called upon to withdraw the proposed changes,” the ministry reportedly wrote, according to Reuters. The news wire added that the ministry has asked WhatsApp to respond to 14 questions including the kind of user data it collected, if it profiled users based on their usage habits and on cross-border data flows.

CNBC could not independently verify the content of the letters.

A WhatsApp spokesperson told CNBC in a statement, “We wish to reinforce that this update does not expand our ability to share data with Facebook.”

“Our aim is to provide transparency and new options available to engage with businesses so they can serve their customers and grow. WhatsApp will always protect personal messages with end-to-end encryption so that neither WhatsApp nor Facebook can see them,” the spokesperson said.

What is the update about?

India is a massive market for WhatsApp

Be it WhatsApp, be it Facebook, be it any other digital platform, you are free to do business in India … but do it in a manner without impinging upon the rights of Indians.

Ravi Shankar Prasad

India’s technology minister

“It has become a platform for many things. Small businesses and corporations are using WhatsApp to conduct commerce, payments and sharing of payroll data,” Abishur Prakash, a geopolitical specialist at the Center for Innovating the Future (CIF), a Toronto-based consulting firm, told CNBC by email. “This makes WhatsApp, an American service, a new kind of infrastructure for doing business in India.”

The stakes for WhatsApp in India are very high, according to Prakash. He explained that there is a possibility the messaging giant may change its policy “because of the strategic position India holds in its strategy.”

When seen through the lens of tech sovereignty and data, New Delhi wants to establish its own data borders after pushing for an open data marketplace where large tech firms share information with Indian companies, Prakash said. “This makes the new WhatsApp policy counter to the direction New Delhi is moving in.”

On Tuesday, India’s technology minister Ravi Shankar Prasad had a few choice words for Facebook, WhatsApp and other tech companies operating in the country.

“Be it WhatsApp, be it Facebook, be it any other digital platform, you are free to do business in India,” he said, speaking at a virtual event. “But do it in a manner without impinging upon the rights of Indians who operate there.”

“And, the sanctity of personal communications needs to be maintained,” he added. “I know there will be pressure for sharing of (data, but) this is plainly unacceptable.”

CNBC’s Arjun Kharpal contributed to this report.

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