One year in cryptocurrency and blockchain: third quarter of 2018

The third quarter of 2018 made it abundantly clear that regulators in the United States were simply not willing to approve a product traded on the exchange with bitcoins at any time. Over the same period of time, the decline in interest in large-scale mining operations has captured hardware manufacturers. Meanwhile, decentralized trade in cryptocurrency (DEX) has grown in popularity, with Binance and Bitfinex announcing the development of their platform iterations.

Even if the cryptocurrency the market did not show any significant signs of a recovery in prices towards the second half of 2018, the blockchain and cryptocurrency ecosystems continued to see a significant uptake in the business sector. For example, Wall Street interest in cryptocurrency it reached critical mass in August, when the owner of the New York Stock Exchange was founded Bakkt, a federal regulatory market for Bitcoin created in collaboration with Starbucks and Microsoft.

Other Crypto ETFs denied

After vote against the Winklevoss twins' proposal for a cryptographic ETF at the start of 2018, the United States Securities and Exchange Commission (SEC) disapproved several other documents in August. A total of eight proposals were presented by ProShares, Direxion and GraniteShares. In an official statement, the SEC stated that the proposals did not sufficiently satisfy the requirement of Securities Exchange Act of 1934.

The SEC said that ProShares, for example, did not demonstrate that it could design an exchange platform to "prevent fraudulent and manipulative acts and practices". Among other things, the exchange did not offer any record evidence to show that bitcoin futures markets are "markets of significant size". "

Nevertheless, in every single public press release, the regulator stressed that his refusal of ETFs "is not based on the assessment that bitcoin, or blockchain technology in general, has utility or value as innovation or investment".

Exchange of options Cboe, meanwhile, presented another application for a bitcoin-based ETF in collaboration with the management company VanEck and the startup blockchain SolidX. Instead of rejecting the application, however, the SEC postponed his judgment twice and has not yet arrived at a decision. The three companies met with the SEC market supervision office, no later than 28 November 2018.

"Unhackable" portfolio of McAfee and BitFi

John McAfee, best known for founding the McAfee antivirus software company, became a figure of controversy in cryptocurrencies and technological communities when he began to promote a certain portfolio of cryptocurrencies as "unhackable. "The wallet, called BitFi, was to be sold for $ 120, a significant price premium compared to existing hardware wallets. Security researchers firmly opposed the "unattainable" claim on social media and slammed McAfee to join the brand.

In response, BitFi announced a bounty program this offered $ 100,000 to anyone who managed to penetrate the hardware portfolio. McAfee wrote on Twitter: "For all the opponents who claim that" nothing is unattainable "and do not believe that my Bitfi wallet is truly the first non-enabled device in the world, a $ 100,000 fee goes to anyone who can hack it. talk, bullshit. "The sum was raised to $ 250,000 a week later.

Almost immediately after the announcement, security researchers have begun to queue for the chance to prove that McAfee is wrong. In a few days, experts established that the wallet was not only exploitable but also easily penetrated. According to numerous reports between July and August, various individuals have succeeded in gaining system-level access to the software, decoding partition lists and even hacking the device to perform DOOM. After reviewing the wallet's hardware, the researchers concluded that the hardware portfolio was little more than an Android smartphone, without cellular capabilities.

Exactly one month after reviewing the amount of the size at $ 250,000, BitFi announced that remove the "inaccessible" mark from its product. The company claimed that the complaint "caused a significant amount of controversy". He also eliminated the bounty program, which has never been assigned to any security researcher.

Nvidia surrenders with mining

Colossal graphic processor Nvidia published a document relating to the second quarter of the 2019 fiscal year on 17 August 2018. In its report, the company revealed that the previous year's demand for cryptocurrency mining was starting to slow down rapidly and it would not have achieved sales targets at any time. In a conference call with analysts, the CEO of the company Jensen Huang said:

"We have benefited in the last few quarters of an unusual transition from Crypto, but at this moment we consider it immaterial for the second half".

Reportedly, Nvidia expected to earn $ 100 million in earnings from digital money only, but managed to raise only a paltry $ 18 million in the second quarter. As a result, Nvidia failed to meet the analysts' projections for the third quarter profits of a few million dollars. However, as the company continues to be the de facto choice for data centers and products, it has managed to record an overall increase in turnover of 40% on an annual basis.

Binance announces DEX

CNBC Crypto Trader & # 39; s Ran Neuner interviewed Binance CEO Changpeng Zhao at the Taiwan Blockchain Week in July, briefly touching the issue of distributed exchanges. Zhao said:

"I think decentralized exchanges are the future, I do not know when that future will come – I think we are at an early stage for this, so I do not know if it will be a year, two years, three years or five years, but we have to be ready for it Now we are actively investing our efforts, our time in this.We have a dedicated team working on this. "

In August, Zhao tweeted a "rough, pre-alpha" demonstration of the DEX Binance which displayed a command-line program that could issue, list and exchange digital currencies. The six-minute video showed that the whole process could be completed without much friction and within minutes.

In the end, at the end of September, Zhao announced that he is imminent decentralized exchange would use BNB of Binance token as "native gas". He also clarified that the exchange will not control the user's funds, ensuring the decentralized aspect. A public beta should be released sometime in the first half of 2019, with public publication to be followed shortly thereafter.

More recently, in December 2018, Binance released an updated preview of the DEX and Binchain Explorer. L & # 39; Preview on show a complete and proven graphical user interface creation, financing and order portfolio itself.

Final points from the third quarter

Although cryptocurrency prices increased at the beginning of August, the rise did not last very long. At the end of September, Bitcoin was once again trading in the $ 6,000 region. At several points in the third quarter of 2018, bitcoin market capitalization approached dangerously below $ 100 billion.

As we will see in the final part of this series, however, the cryptocurrency market has faltered again in November, bringing back the bitcoin capitalization to the 2017 summer levels. In September, Bitcoin's dominance in the global market for cryptocurrency reached its highest point, when it represented 57% of the cumulative capital cap of the cryptocurrency market.