Weekly Digest: Events that influenced the Bitcoin price
This week was rich with events that may cause a change in the value of bitcoin.
This week was rich with events that may cause a change in the value of bitcoin. George Osbourne’s promise to make changes in the UK regulation system, the announcement of a new proof-of-concept Blockchain-based remittance services from Visa Europe, and of course, the Ethereum Devcon1 conference, could all positively effect the price of bitcoin.
Bitcoin Companies In London Consider George Osbourne To Regulate A Problem Of Opening Bank Accounts
UK Bitcoin companies face problems with opening bank accounts. Banks simply refuse to cooperate with startups involved with Bitcoin in any way. Naturally, this alarms Bitcoin-related companies as it may cause a certain number of problems in providing their services. George Basiladze, the CEO of Bitcoin wallet and exchange service Cryptopay.me based in London since 2013, told Cointelegraph:
“You may have favorable regulations and the FCA may support and license you, but if you cannot get a bank account (just a standard one) you cannot operate. This is easy. Not for BTC companies, though. If you say that you are doing anything connected to bitcoins and bitcoin exchange, you will not get a bank account in the UK. Banks do not like Bitcoin companies as they make their compliance department’s head explode.
Companies cannot provide truly innovative solutions with ~ zero fees, because they do not have the means to do that. No bank account is the way to additional fees, bad service and other issues.”
Now, UK Bitcoin companies expect George Osbourne to deal with this problem as he has promised to make London a leader in FinTech and cryptocurrency industries during his speech at Bank of England's Open Forum, held on November 11.
Visa Europe Announces Blockchain Remittance Proof-of-Concept
Bitcoin and Blockchain technologies are quite controversial. On one hand, they seem to have huge disruptive potential for the entire financial system. On the other, they still appear to be uncertain and unreliable especially if we look at “epic fails” like the hack of Mt. Gox and the significant price volatility. Nevertheless, the technology deserves to live despite some obvious paradoxes which need to be addressed for its successful development. And even some companies from the traditional financial sector are seeking ways to integrate these innovative technologies into their services.
For example, Visa Europe has announced its work on a proof-of-concept fora blockchain-based remittance service. This initiative was created through Visa Europe Collab in collaboration with Epiphyte, a recent graduate of San Mateo incubator Boost VC. The project is currently at the stage of testing. The developers state that it is tested in a "controlled test environment" which simulates real transactions. They also say the project will be completed in two months.
Ethereum Devcon1 has concluded and Aron van Ammers, Chief Technology Officer and Founder of BlockStars.io, has his review of the event. The conference showed us a bunch of different DApps for financial and non-financial spheres. There were DApps for prediction markets, gaming and IoT. All the offers had one thing in common; they couldn’t exist without blockchain-based smart contracts networks like Ethereum.
In whole, Devcon1 was an amazing event which highlighted the progress and possibilities of blockchain technology. The conference was closed with a speech from Vitalik Buterin that resulted in a standing ovation.
“The Ethereum community has grown. It's attracted people from all parts of the world, and one of my favorite parts about this space is the sheer diversity, the quality, the different kinds of people that we've attracted. This isn't just about a currency and this isn't just about even one particular platform. This is a movement. It's a movement of software developers, of mathematicians, of political activists, entrepreneurs, social entrepreneurs, banking executives, and I think this week we've seen just about everyone represented. The community to me is probably my favorite part of this whole thing. So thank you all, and I hope to see you next year,” said Buterin.
Blockchain As A Service: Microsoft Azure Runs BlockApps And Ether.camp
Shortly before Devcon1, tech giant Microsoft announced a partnership with Ethereum-focused company Consensys. It was also announced that the Microsoft Azure cloud platform would allow for the running of Ethereum nodes with the BlockApps stack. This means that blockchain-as-a-Service or Baas, created by William Mougayar, will be a reality. On the other hand, this also means a presence of a cloud provider as a third party. It can be viewed as a centralizing factor and a threat to the basic principal of blockchain functionality, if the majority of nodes are deployed on a single cloud provider.
Overstock explores spin off of cryptotrading unit
Online retailer Overstock announced the split off of its blockchain trading subsidiary Medici. The reason for the split is because the subsidiary has pushed the company into the red for the first time. It’s worth mentioning that Overstock had previously had nine quarters of success. Overstock chief Patrick Byrne commented on the situation to Finextra:
“The direct costs of our Medici efforts this year will be in the neighborhood of $8 million (and when you add shared overhead, services provided by dual-tasked employees, and load factor, the real cost this year is significantly greater).
For obvious reasons I do not believe that this enterprise can be co-managed with our online retailing business, and in that regard am aggressively exploring alternatives with an eye to maximizing shareholder value.”
11/11/2015: Bitcoin Price Falls Sharply
Last week bitcoin faced a significant increase in price, valued at nearly $500 per coin. This week the price has declined sharply. As of the time of this writing, the price is fluctuating between $318 and $333. One of the reasons for this could be the significant reduction of bitcoin trading volume over the last week. However, some experts believe this could be caused by growing activity of Sergei Mavrodi’s “MMM” in China.