Bitcoin Rebounds on Legal Tender Status in Japan: BTCManager’s Week in Review April 3
The price of bitcoin is regaining strength, with prices trading around $1150 at the time of writing, following the attainment of legal tender for cryptocurrencies in Japan, effective April 1. In the altcoin world, Litecoin and Ripple, two established incumbents, have flexed their muscles and displayed a significant increase in both volume and price.
In a major step forward for bitcoin adoption, Japan, the world’s fourth-largest economy, has granted the cryptocurrency legal status as a method of payment. As highlighted by BTCManager, Japan will also operate a ‘whitelist’ of approved cryptocurrencies, likely to remain conservative and revolve around established altcoins such as ether. However, in wake of the news out of Japan, XEM, a popular altcoin in the country, has surged in value even against bitcoin.
Litecoin (LTC) and Ripple (XRP) both displayed an increase in value in excess of 100 percent at one point last week, accompanied by a huge influx of volume. Litecoin’s price most likely jumped due to a combination of factors favorable to the altcoin; progress on SegWit, the introduction of margin trading at GDAX, as well as a potential collaboration with Tether.
Ripple‘s market capitalization jumped above $1 billion, heights only achieved by Bitcoin and Ethereum as it added new features to its network. The Ripple Consensus Ledger and Interledger Protocol can interact with each other, which is claimed to create a network that can interconnect all the world’s value on ledgers. Scalability- and performance-enhancing features were implemented March 31, namely Escrow and Payment Channels.
This week’s review is compiled from contributions by Alexander Lielacher, Christoph Bergmann, Evan Sixtin, Jamie Holmes, Joseph Young, Michael Scott, Nigel Dollentas, and Nuno Menezes.
On December 17, local publications including the Japan Times revealed that the country’s Financial System Council proposed a bill which called for the recognition of bitcoin as a legal payment method and requires bitcoin exchanges to register with the country’s financial regulator the Financial Services Agency. According to a Fuji Chimera Research Institute study, roughly $1.7 billion of cryptocurrency was in circulation throughout Japan in 2015, and this number is expected to increase to nearly $9 billion by 2020, prompting the accommodative regulatory measure.
With cryptocurrency in an overall bull run, it is not difficult for a trader or investor with a portfolio in cryptocurrency to make impressive gains. However, the biggest returns are being made in altcoins at the moment, with an increasing popularity in older, more established altcoins such as litecoin. As litecoin maintained being a dark horse of sorts, price appreciated once the amount of miners supporting SegWit approached majority; something bitcoin is still struggling with.
Is India on the brink of becoming the next China? Did the central bank make bitcoin illegal? Or legal? Or both? A newspaper reports that bitcoin has become illegal in India, but an Indian exchange denies this. A committee shall decide who is right. According to the Economic Times of India the Indian central bank, the Reserve Bank of India (RBI), pointed out that the use of virtual currencies like bitcoin is not authorized by the RBI and “could result in the breach of anti-money laundering provisions.” The RBI already warned users, holders, and traders of the risks that the use of bitcoin could result in.
Iran is one of the few countries that are being affected by sanctions made by the US government. Even for countries in Europe, it is challenging to trade and invest in Iran and the country’s local markets because of the financial barrier set by the US authorities and regulators. Therefore, companies like BNW need alternative channels or financial networks to transfer money to Iran with efficiency and a high level of security. Also, as BTCManager reported on January 31 that Iran had moved to dump US dollars, opening up a greater acceptance to cryptocurrency in the Islamic republic.
To prevent a hard fork that splits the Ethereum blockchain in two (for the second time), developers have implemented a difficulty time bomb also known as an ‘ice age.’ The Ethereum ice age is a mining difficulty adjustment scheme that was created to incentivize miners to switch to the new PoS blockchain. Once the fork is executed, the mining difficulty rises exponentially to a point where it would be impossible for miners to keep up with the difficulty increase that would hike block time and make the blockchain effectively freeze. Hence, the term ‘ice age.’
Jason Teutsch and Christian Reitwießner have published their work detailing a protocol of how dogecoin will be received into the Ethereum network, known as TrueBit, in their whitepaper “A Scalable Verification Solution for Blockchains” The March 28 reddit post calls for help on the Dogecoin side so that “doge doesn’t get locked up in Ethereum.” In a nutshell, TrueBit is basically an Ethereum smart contract with a sole purpose in Dogethereum is to allow Ethereum to check Dogecoin’s Scrypt proof-of-work, which is something that current Ethereum smart contracts cannot do.
Switzerland-based ShapeShift AG, owner of ShapeShift.io (instant digital asset exchange) and Coincap.io (real-time digital asset data), has raised $10.4 million in Series A funding for future expansion. Specifically mentioned were two new “mysterious” exchange-related products which will be coming out before the end of 2017.
IBM Partners with Natixis and Trafigura, Introduce First Blockchain Solution for U.S. Crude Oil Market
IBM announced a partnership with Natixis and Trafigura to introduce the first blockchain development for commodity trade finance for US crude oil transactions. The March 28 announcement marks the beginning of the institutional use of the blockchain technology. The trading industry is today mostly driven by manual, non-digital processes, so this initiative comes as part of a plan to start modernizing trading in the global crude oil industry.