In the course of the most recent two months, Bitcoin cost has energized from the profundities of the bear market to a well over a 100% increase for crypto financial specialists who purchased when there was “blood in the roads.” Those who caught the base have viewed at their interest in Bitcoin twofold quite promptly, with practically no amendments all through, expect for a blaze crash that saw Bitcoin filling holes left on the diagram amid night-time prospects exchanging.
In any case, in a most recent few days, another glimmer crash happened on the value graphs for BTC/CAD – a blaze crash that killed 99% of Bitcoin cost in the matter of seconds, dispatching orders as low as simply over $100 Canadian.
BTC/CAD Pair Flash Crashes 99% on Kraken
Bitcoin is going down. We’ve all heard the rehashed fate and misery forecasts from savants and commentators of computerized resources. As of late as a week ago, the New York Post distributed an article that was scarcely a couple of sentences of pointless counterarguments against Bitcoin’s ongoing rally, attesting the digital money would before long achieve zero.
Be that as it may, have you at any point viewed Bitcoin nearly hit zero just directly in front of you? That is the thing that occurred incidentally the previous evening on the Kraken digital money trade amid exchanging sessions of the BTC/CAD pair. BTC as you most likely are aware is the “cashtag” or exchanging image of Bitcoin, and CAD is the image for the Canadian dollar.
Amid the blaze crash, the cost of Bitcoin in Canadian dollars tumbled from its exchanging range around $11,250, to a low of $101.20. Shrewd Kraken merchants with requests at $100 were missed by a little more than a buck before the cost of the digital currency soared over into the range, leaving the longest wick this author has ever seen on a value graph.
Some fortunate merchant had their requests filled for $101 Bitcoin. Be that as it may, there’s a dealer for each purchaser, and some poor financial specialist on the opposite side of the exchange assumed a huge misfortune on their Bitcoin deal.
The fall spoke to a 99% drop in cost, basically taking out all an incentive from Bitcoin and carrying it as near zero that the benefit has been since the beginning of the advantage and before the open recognized what a cryptographic money was.
In conventional markets, safeguards called circuit breakers are set up on trades like NYSE by controllers to maintain a strategic distance from glimmer crashes, or other quick decreases because of frenzy incited selloffs. These measures were set up following October 19, 1987 when the Dow Jones Industrial Average fell over 22% in one day. The blaze crash that provoked the situation of electrical switch was later named “Dark Monday.”
Crypto merchants who keep a little measure of fiat on save with offer requests for crypto resources set amazingly low in the event of a blaze crash, may get filled and experience the most gainful exchange of their lives in only seconds.
One of the most common discussion topics that you may be surrounding is about blockchain and bitcoin. Another thing that emerges from it is whether the Blockchain and Bitcoin or the cryptocurrencies are different or are they the same? I’m going to say they’re different to keep it short. While Bitcoin was the first cryptocurrency to emerge in 2008; the underlying technology was Blockchain. Bitcoin was one of the first and should say, Blockchain’s most successful application since its inception. Furthermore, the confusion among blockchain and cryptocurrencies arose with its rise. Though both were initially used interchangeably, we now know that these two things are completely different. And I’ll highlight the difference between the two in this blog. So keep on reading to get a better understanding.
Part of the confusion about blockchain vs cryptocurrency is partly due to the use of the terms. The term blockchain developed from “chain of blocks” rather than being introduced by formal definition. Cryptocurrency is a kind of “cryptographic currency” portmanteau. But how distributed ledger technology is used is the key difference between these concepts.
HOW DO BITCOIN AND BLOCKCHAIN DIFFER?
Before going on to the in-depth analysis of the difference between cryptocurrencies (Bitcoin) and blockchain, let’s get a quick overview of this concept.
Bitcoin– Bitcoin was, as we all know, the first cryptocurrency or digital currency as we tell it was a sort of unregulated currency which came into the frame in 2008. It became popular, and we got the new currency type called the cryptocurrency. It is unregulated and free of regulations governing the control of currency. The goal behind this was to develop a system which would bypass the need for a third-party platform, decrease processing fees, and fasten transaction speed globally. All these processes required the establishment of a system or technology which could guarantee a secure way of transaction.
Blockchainformed the underlying technology that contributed to money transfer. This technology was a distributed, public and anonymous ledge on a peer-to-peer network. Blockchain had, in simple terms, all the features that were in sync with the need to create a safe, secure and transparent transaction system that is also anonymous and free of any regulation.
It was the core of the difference between the two. Here on, the other differences between blockchain and cryptocurrency will be highlighted.
Assets In Relation To Cryptocurrency
Cryptocurrency is only one of the blockchain’s applications. This technology uses much more than just cryptocurrencies. It can be used for a much wider asset range such as cars, properties, luxury products, food products, and so on. Everledger is an example of this. Blockchain is used to trace the origin of luxury goods in order to reduce fraud, document manipulation, and information.
In the case of Bitcoin, referring to the token as the technology may be right, but when dealing with other blockchain projects such as Ethereum, it is very different. The technology is called Ethereum in this case, but the native token is Ether, and transactions are paid in gas.
Banks Prefer Blockchain
Blockchain is more trustworthy than Bitcoin when it comes to choosing between the two. Compared to Bitcoin, blockchain has a cleaner reputation. Several reputable financial institutions such as JP Morgan, Goldman Sachs, Bank of America, have jointly expressed deep interest in introducing blockchain technology to streamline and strengthen the banking process. Banks can increase their transaction tendency by utilizing their permission blockchains.
The Blockchain Is Extremely Versatile
Blockchain is a technology with a multitude of features when it comes to versatility. On the other hand, bitcoin is less versatile. In addition, the use of Bitcoin in certain nations of the world is unregulated. On the other hand, blockchain finds multitudes of different field applications. Companies use this technology from healthcare to supply chain management to develop a more evolved and streamline the functioning process.
WHY IS BLOCKCHAIN GOING TO TRANSFORM THE GLOBAL ECONOMY?
Blockchain is dynamic technology when it comes to its future, and similar to the internet technology that has changed the world, blockchain is expected to do the same as well. More and more businesses are turning their attention to this technology now. Once entered in this distributed digital ledger by design, the information is unchangeable and unalterable. Hence, setting up better confidence in the business network. Not only does it save time, but it also makes the system more transparent and secure. It is the main reason for the popularity of Bitcoin and other cryptocurrencies. Furthermore, there were a lot of apprehensions surrounding Bitcoin with its growth. But, in the midst of all this Blockchain arose as a new avenue of growth and forward-looking technology that could solve all the problems related to the current technology we use.
HOW BLOCKCHAIN HAS BEEN USED MUCH MORE FURTHER THAN CRYPTOCURRENCY
Eventually, the blockchain is much more anti-fragile than cryptocurrencies; it enables us to work with everything in modernized ways that fit our present technological age. And everywhere it’s being seen. The first blockchain casino has been launched, and there are several more examples of thrilling applications for public ledger.
Walmart used Hyperledger, the blockchain platform developed by IBM, to decrease processes of food tracing from 6 days to mere seconds. In several other industries, the objective now is to use Hyperledger. A Gartner blockchain trend insight report claims that by 2030 blockchain will add $ 3.1 trillion worth of value to businesses. As illustrated by the Walmart example, the report cites supply chain as a good area for blockchain application and lists healthcare, education, manufacturing, energy, and government as other sectors that might profit.
Any industry requiring rapid verification of information – that is, every industry – will be able to run on public ledger technology. Even Starbucks wants to get into the action; Howard Schultz, chief executive of the coffee chain, said he wishes to use blockchain to “deepen the relationships of digital customers.”
Government experts in China’s Sichuan area are apparently testing into nearby bitcoin mining farms that have purportedly been developed without authority endorsement.
A state-possessed paper in Sichuan distributed a first page article on Thursday saying the land-asset agency in Sichuan’s Garze province has found bitcoin mining ranches with no earlier endorsement worked at the destinations of hydropower stations.
The article included that the Economic and Information Bureau in Garze – a bumpy zone with plentiful water assets – has shaped a council with different organizations to test into the unlawful development issue.
“We are as yet examining on the issue and can’t reveal more subtleties on the general circumstance,” one authority from the Economic and Information Bureau was cited as saying.
The current issue is that bitcoin mining ranches were found being worked at hydropower stations along the Dadu stream in northwestern Sichuan to take advantage of the shabby power in the zone, however did not acquire approval for development heretofore.
The article distinguished one explicit bitcoin mining office inside a hydropower plant called Ginkang station, which has the ability to have 50,000 units of bitcoin mining gear, of which 60 percent are as of now working.
“On the off chance that [a bitcoin mining farm] is worked inside the approved zone of a power station for power utilization, we have to confirm if their use is lawful. In the event that it’s outside the approved territory, at that point it should be managed as the development was not endorsed,” an authority from the nearby land asset agency said in the report.
As the mid year stormy season approaches in China, diggers have been putting again in Sichuan’s uneven zones including the Garze and Aba provinces, planning to support ROI with the areas’ modest power.
In a report distributed last November by blockchain research firm Coinshare, about 50 percent of the worldwide bitcoin system’s hash rate originated from offices situated in Sichuan at the time.
As of late, the bitcoin system’s absolute hash rate has move to almost 58,000 petahashes every second – that is up around 80 percent from last December, when in excess of 600,000 mining machines were assessed to have closed down in the midst of bitcoin’s bear market costs.
The authority from the Economic and Information Bureau further demonstrated that Garze province does not permit bitcoin mining ventures.
“We don’t permit outside interest in the region to be associated with bitcoin. Notwithstanding for huge information ventures, we will direct an examination concerning the idea of the information required before settling on a choice.”
Anyone who has kept up with the Bitcoin scaling debate over the past few years is destined to familiarize themselves with the terms Lightning Network and Off Chain Scaling Solutions that have come with promises of hundreds of millions of transactions per second and virtually zero fees. But how precisely are these technologies helping to scale the network of Bitcoin? Let us just look a little deeper.
The Lightning Network is, in the simplest terms, Bitcoin’s off-chain scaling solution that will allow for bidirectional payment channels. What this implies is that two users with Lightning Network can choose to open a private Bitcoin transaction channel without consulting the main blockchain to exchange Bitcoins among themselves. To open a channel, both parties must make an on-chain transaction stating the amount to be exchanged on the channel. After that, until one of them decides to close the channel, they can choose to do as many transactions as they want. The channel “settles” with the main Bitcoin blockchain after the channel is closed and the updated balances are paid out to both parties.
As per the white paper on the website of Lightning Network, the new technology will allow the Bitcoin network to handle instant payments at a very low cost that could be the foundation of a machine economy that will be needed by the devices enabled by Internet-of-Things. In addition, Lightning Network allows cross-chain atomic swaps off-chain instantaneously with other blockchains as long as they use the same cryptographic hash function. These additions enable the Bitcoin network to exponentially scale up to billions of transactions per second needed to facilitate microtransactions in the machine economy and bring affordable Bitcoin trains.
Because the Lightning Network transactions are off-chain handles, there’s no record of those transactions on the main chain that is very useful in restricting the size of the blockchain. The current Bitcoin blockchain is about 150 GB which is already enormous and if it continues to grow at its current rate, the centralized model of Bitcoin is bound to suffer as independent node owners would have to shut down their devices leading to larger data centers running enormously centralized nodes.
Not Fully Functioning– Maybe the Lightning Network’s biggest disadvantage at the moment is the fact that it’s not yet fully operational, so there’s no way to fully claim how good it is. It’s concept, however, looks great on paper, but it’s still impossible to find out if it’s going to look great once it’s realized.
The Complexity of Channels- The Lightning Network is conceived as a kind of channel web that should theoretically permit seamless transactions once it has been established. There’s no saying what’s gonna happen if the payment is going to have to take a route that’s too complicated. If your transaction is going to have to go through dozens of intermediate channels, the fees will certainly add up.
Channel Caps- Another disadvantage of the network is that the channels are capped in its latest version. That is, the maximum amount of funds in that channel is the number of Bitcoins stored in the wallet by the two users when a channel is established. This setup creates a situation where a few users on the main blockchain may have to choose between having liquidity within the channels of the Lightning Network and having liquidity outside them. This is far from ideal, particularly for resource-limited people.
Again, it is worth noting that the advantages and disadvantages of the above-mentioned Lightning Network are very speculative at the moment.
The situation isn’t all roses for Bitcoin’s future as the Lightning Network comes with its own set of issues, the primary of which is its decentralization aspect that is under much doubt. Because a payment channel works by having a certain amount of deposit in a bidirectional payment channel, in order for each user to become an active participant in a global decentralized mesh network where the network acts like a Directed Acyclic Graph, each user would have to have an average of four payment channels open.
If users perhaps have only a single channel open, the topology of the network will look like a hub-and-spoke model that leads to a lot of centralization for big data centers, or in the case of Bitcoin, big exchanges, and miners. Also, because setting up a Lightning Network payment channel needs a chain transaction per channel based on current network congestion statistics, setting up four payment channels each could take many months or even years for approximately 100,000,000 users. According to the debate on the official Bitcoin subreddit concerning Lightning Networks and decentralization, users came up with estimates that imply that for approximately 100,000,000 users to be part of the truly decentralized lightning network which lets them exchange $100, would need around 100,000,000 X 4 X $100 = $40,000,000,000 committed to open channels that based on current usage patterns, seems unlikely.
To sum up, Lightning Network is Bitcoin’s most advanced scaling solution, but whether it will increase or decrease overall centralization would depend on a lot of factors such as the number of people connected to the open channels and the influence of centralized exchanges and miners. Cross-chain atomic sweeps may provide another possible solution to the centralization problem, that could be useful in creating open channel records on the chain. Because Lightning Network is mainly used to exchange signatures, it can also be used to exchange signatures for contracts that are published on more than one blockchain at a time. This makes it possible to hyperlink multiple blockchains to each other, which is where Lightning Network’s real power lies.
We all know that Bitcoin is presently the most searched topic on the search engines. The sort of storm that has led many nations to consider making it part of the mainstream economy. Venezuela is the recent addition to cryptocurrencies appreciators or virtual currencies. Petro, a bitcoin-like currency, was announced by the country. A lot is not revealed about it, though. Let’s turn our attention to India. We all know that India is presently the hot spot for various activities and planning to invest in India is planned by many nations around the world. How can it skip the impact of Bitcoin when there are so much hype and hoopla going all over our country? Being on the world’s largest markets, India still needs to work out its Bitcoin policies.
Bitcoin is a new cryptocurrency that emerged in 2009 and has seen phenomenal growth ever since. Although it is impossible to claim the same for his other contemporaries. As far as India’s view is concerned, then the Indian Finance Minister Arun Jaitley claimed that India still had to work out its opinions on Bitcoin and other cryptocurrencies.
True, India’s government still has to acknowledge Bitcoin as a legal currency. The talks are on the table to set up a system to analyze all the possibilities for legalizing cryptocurrencies. But we have no official announcement about the same thing. India is undergoing a major economic transformation, particularly after demonetization, and the introduction of the new currency will be too much for people, government and people to gulp down.
WHAT’S BEEN DONE SO FAR?
Despite not having much, the Indian government is working on regulating the use of virtual currency and a panel led by India’s Secretary of Economic Affairs, Subhash Chandra Garg, was expected to present its findings this month to a panel. In April 2017, the government set up an interdisciplinary committee to evaluate the regulations which would covet cryptocurrencies. This board included Indian Reserve Bank, Revenue Ministry, and the Financial Services Department.
Bitcoin and other cryptocurrencies in India’s status and future are decreasing. Using this currency, we have no formal regulations to support transactions.
Even though the use of cryptocurrency transactions involves multiple risks, an important point to note here is that in the previous year many traders have earned returns of 1600 percent. It’s the fastest appreciation we’ve witnessed, paving the way for people to have a great investment opportunity.
We are still waiting for some positive news, but we still have to wait until some legal framework is formulated and established in the midst of all the economic transformation that is going on in India. But, saying that Bitcoin and other currencies are here to remain for a long time wouldn’t be incorrect.
2018 was a crucial year for the cryptocurrency ecosystem in India. From a central bank dictatorship that prohibits banks from trading in crypto coins to the largest exchange in the country, Zebpay, downgrading its shutters, investors and traders believe they’ve seen it all over the past year.
Bitcoin’s price was at an all-time high of almost $ 20,000 in December 2017, and investors in India made a beeline for crypto coins. Prices collapsed this year, furthermore, and a bitcoin is currently priced at around $ 4,000.
Now, all eyes are on the government of Prime Minister Narendra Modi, who will soon be drafting a clear policy on bitcoin and its ilk.
HOPES FOR THE YEAR 2019
“The ecosystem has remained stagnant due to the confusion since businesses have put their plans on hold,” said Unocoin’s co-founder and CEO, Sathvik Vishwanath, a cryptocurrency exchange. Moreover, Vishwanath is hoping that the regulatory position will be clarified in 2019 so that the ecosystem can become stronger.
In addition, the government has shown a keen interest in developing blockchain technology in India. The industry is positive because cryptocurrencies and blockchain are intertwined.
“We will see a growing number of blockchain products and services with real use cases in 2019. And this will lead to a bull run on the virtual currency market,” said another Indian cryptocurrency exchange, Coindelta co-founder Shubham Yadav.
2017 was a bull market for bitcoin and other cryptocurrencies, while they were in a bear hug’s midst in 2018. As we reach 2019, the industry hopes the pendulum will swing again.
“It was a wild ride this year. After viewing the parabolic move in bitcoin last year, lots of new investors came into the picture and are now scared,” said a cryptocurrency enthusiast who describes himself with the pseudonym Gabru and runs groups on the instant messaging platform Telegram with over 4,000 members. “Individuals who have been in crypto for a longer period of time know that this is yet another market cycle like the previous ones when Bitcoin dropped 80-90 percent (in previous bear markets) but was still able to break all-time highs a few years later. This time I don’t think it’s different.”
Stay tuned in to get more latest updates on the cryptocurrencies and its future in India!