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New Daily Digest on Hong Kong Issues Bitcoin Warning, Russia Reconsiders Stance, and BitPesa Raises US$1.1 Million
Amidst the alleged sudden bankruptcy of Hong Kong-based Bitcoin trading and investment company MyCoin.hk, which might have lost customers almost $400 million in bitcoin, Hong Kong’s central bank has warned against investing in virtual currencies. The Hong Kong Monetary Authority said in a statement late Monday that the case may involve fraud or pyramid schemes, adding:
“Given the highly speculative nature of Bitcoin, we have all along urged the public to exercise extra caution when considering making transactions or investments with Bitcoin.”
The crypto-anarchist hackers collective unSystem has developed a new tool built to set information free. Darkleaks lets users leak data in an anonymous environment in exchange for bitcoin. According to the developers:
“We give the world a new scheme for selling information of any type, form or kind. This is a gift for you to stop corruption and challenge power.”
BitPesa, the Nairobi-based remittance service using bitcoin, announced that it's raised US$1.1 million in a second round of funding led by San Francisco-based Pantera Capital. Furthermore, Dan Morehead, Pantera’s CEO and founder, joined the startup’s board of directors. Other investors include Crypto Currency Partners, Stephens Investment Management, Bitcoin Opportunity Corp., and Future/Perfect Ventures.
Adding another chapter to Russia's fickle history regarding cryptographic currencies, the Ministry of the Interior of the Russian Federation (MVD) issued new statements on bitcoin. The agency suggested it would wait on a decision of the country’s central bank before taking any action on matters of policy. Which is noteworthy, in particular because Bank of Russia officials seemed relatively favorable to digital currency in the past.
Approximately 105 bitcoins and 900 litecoins have been seized by federal law enforcement officials, along with hundreds of golden and silver bars and coins as well as luxury items including sports cars, wedding rings and a diamond-encrusted Rolex. Target of the seizure was a Seattle-based business operator who is said to have sold and distributed counterfeit software. At the time of seizure, the bitcoins and litecoins added up to more than US$25,000 worth.
Co-working and co-living space 20Mission, former home to Bitcoin startups such as Blockchain.info, 37Coins, Tradehill, Piper Wallet, and PurseIO, announced the launch of Nakamoto's electronics, the first Bitcoin retail store in San Francisco.
Andrew Lee, CEO of Purse.io commented on Nakamoto's launch:
“It is a great way to onboard new users with goods and products that they can pick up and physically touch. We’ll have a BTM (Bitcoin ATM) on site so if you don’t have Bitcoin and only have cash you can purchase Bitcoin and take your discount on the spot."
BitX, the bitcoin enterprise with a specific focus on emerging markets such as Kenya and Malaysia, has now opened an office in Jakarta, Indonesia. In doing so, CEO Marcus Swanepoel has brought his services to a population of 252 million people in one of the world's fastest-growing economies. BitX Indonesia will recruit local staff to provide user support in a language and style familiar to the region's customers.
"[Indonesia is] very relationship-driven, so you need to spend a lot of time on the ground, have local teams with local understanding and networks, local operating structures, and also spend a lot more time in building a brand that people can trust, as these are often very low-trust environments."
Perhaps somewhat surprisingly, Bitreserve CEO Halsey Minor has stated in a blog post that he thinks the term “bitcoin” won't be around in five years from now. Instead, he says, Bitcoin will kickstart an entire movement and shift in how society works. Minor said:
“Bitcoin is poised to be the Netscape of the digital currency movement. It’s not a future currency but a system for better money transmission.”
It is probably one of the most controversial issues within the Bitcoin community: the 1MB block size limit. While some say this limit must be removed or at the very least increased in order for the network to scale, others believe that such modifications might endanger the decentralized nature of the protocol, or render mining infeasible. Discussions on the subjected have been heating up on r/bitcoin and Bitcointalk over the last couple of days.
Not exactly news, but interesting in light of recent developments nonetheless: the new Greek minister of finance Yanis Varoufakis debated Andreas Antonopoulos on Bitcoin back in march 2014. Unsurprisingly, it is well worth the listen. As for the question if Varoufakis really is as negative regarding as some say? Judge for yourself:
“There is a big tragedy here with Bitcoin, which has two folds. My lot, economists, fail to see the brilliance of it. The brilliance of the algorithm, and the fact that it has a great deal of potential. The Bitcoin cheerleaders [on the other hand] abide by a very primitive and dangerously flawed theory of money.”
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