BITCOIN FOR THE ENTREPRENEUR

I wrote this in late 2014, it's probably good for those who are new to Bitcoin.

One of the most important and recent innovations that millionaires will consider using for investment and entrepreneurial ventures is without question, Bitcoin. You’ve probably heard many explanations of what “Bitcoin” is, and I’m sure it’s all of those things and more; but I wanted to add some commentary from the perspective of entrepreneurs to the conversation. Specifically, Bitcoin and the blockchain technology are the latest and quickly becoming the most powerful tools of the social entrepreneur. More specifically, the social entrepreneur working in System D, the ten trillion dollar black market, global economy. If this is the first time you’ve heard of it, you should know it has become the worlds fastest growing economy, without Bitcoin.

System D or l’economie de la débrouillardise is about getting things done, providing products and services to customers while avoiding unfair and monopolistic regulations and taxes. I felt it was important to include this mention of System D to demonstrate just how significant cryptographic currency and blockchain technology are, and will become.

“In 2009, the OECD (Organization for Economic Cooperation and Development) concluded that half the world’s workers (almost 1.8 billion people) were employed in the shadow economy. By 2020, the OECD predicts the shadow economy will employ two-thirds of the world’s workers. This new economy even has a name: “System D.” System D is a slang phrase pirated from French-speaking Africa and the Caribbean. The French have a word that they often use to describe particularly effective and motivated people. They call them débrouillards. To say a man is a débrouillard is to tell people how resourceful and ingenious he is. The former French colonies have sculpted this word to their own social and economic reality. They say that inventive, self-starting, entrepreneurial merchants who are doing business on their own, without registering or being regulated by the bureaucracy and, for the most part, without paying taxes, are part of “l’economie de la débrouillardise.” Or, sweetened for street use, “Systeme D.” This essentially translates as the ingenuity economy, the economy of improvisation and self-reliance, the do-it-yourself, or DIY, economy.” – Freakomonics.com

It is my opinion that those of us interested in renewable energy, sustainable architecture and humanitarian projects will need to understand all of the aspects of Bitcoin, cryptographic currency and blockchain technology.

Bitcoin is one application within an Internet or network based mathematical protocol known as the blockchain. The important features of Bitcoin have their origins in the early nineteen-eighties and cryptography. Before the advent of blockchain technology within the Internet, a “blockchain” was a mechanical system used for heavy lifting, much like the pulley or hydraulics. The blockchain has become a metaphor to describe the “heavy lifting” that it is used for today as a network based mathematical protocol.

The application that we’ve come to know as “Bitcoin” has recently been defined in different countries as currency, a commodity, and an asset, and these countries will continue trying to define Bitcoin and cryptographic currency for many years to come. The interest that nations have with cryptographic currency is most likely in taxation and third party regulation, the core structure of government itself.

When I use the term Bitcoin in this writing, you can apply my explanation to nearly any cryptographic currency. I like to use the word “currency”, but remember, Bitcoin may also be correctly defined in many other ways, such as a “network protocol for the settlement of payments”. Bitcoin is an “open ledger” and its source code is “open source”, meaning that the program that runs Bitcoin can be reviewed by anyone and it can be downloaded and modified to create a new species of cryptographic currency or even a new application for the blockchain itself. Likewise, it is possible to review every single transaction since it was first launched on January 3, 2009. That’s correct, no transaction in Bitcoin is private or secret, every transaction is logged permanently into the blockchain database; however, it is possible to sever your identity from any transaction using the correct encryption techniques.

One exciting prospect I wanted to comment on now is the possibility of requiring your local or national government to use Bitcoin or some version of it. A simple computer application could generate a daily audit showing exactly who is spending what money and paying whom, and with nearly zero cost. It could be made a matter of law that this audit is available on a website every day. The history of transactions could never be altered, ever. Furthermore, anyone using cryptographic currency in the commission of a crime could be investigated by the same police strategies that are used today, with a little consulting about blockchain technology in the early days of course.

You have probably heard that Bitcoin was created by one or more individuals, probably hackers, under the alias “Satoshi Nakamoto”. You can learn more about this history at www.bitcoin.org and http://en.wikipedia.org/wiki/Bitcoin_network. It’s an interesting history but let’s discuss more about the terminology and common uses for Bitcoin today and in the near future.

You will want to follow several of the experts who regularly publish interviews and videos about Bitcoin and its latest news. Two of these individuals are Andreas Antonopoulous and Max Keiser. My Youtube channel has a Bitcoin playlist with many of the best videos on the subject and you can find it via youtube.com under “singleton press”. There are many categories or subjects involving Bitcoin so I decided to simply organize this information with a list of each and then an explanation with references I felt were important. Let’s begin with an understanding of the Bitcoin structure or format as it’s used for money.

Bitcoins began being produced or “mined” in January of 2009. At that time nearly anyone could allow the network to borrow processing time on a computer and at some point, the computer would reward the user for this with Bitcoin money. The production of Bitcoin s has been very intelligently calculated to mimic the mining rate of gold. Its protocol is limited to producing only 21,000,000 Bitcoin s. As of the year 2014, half of those Bitcoin s were already produced; however, it will take another 95 years to produce the last whole Bitcoin, and another 40 years to produce the last fraction of a Bitcoin, known as a “Satoshi”. The last Bitcoin, or fraction of a Bitcoin (Satoshi) will be produced in the year 2140.

A Satoshi is 0.00000001 or one hundred-millionth of a Bitcoin. Instead of one hundred parts to a unit of currency such as for most fiat currencies, Bitcoin has one hundred million fractions for each unit. This makes is possible to ultimately have 2.1 quintillion units of Bitcoin currency. A “thousandth” of a Bitcoin (.001) is known by the notation mBTC, or a “millibitcoin”; and a “millionth” of a Bitcoin (.000001) is known by the notation μBTC, or a “microbitcoin”. It’s my prediction that these terms will be the most commonly used for Bitcoin s in the coming years simply because I believe that we’ll see Bitcoin s being sold for tens of thousands of dollars. At some point, possibly in the next twenty years, I’m predicting that no one will care how many dollars a Bitcoin costs because nearly no one will be using dollars for anything, or should I say anything important.

Please also see https://en.bitcoin.it/wiki/Units.

Bitcoin is not recognized by the ISO and therefore does not have an official ISO 4217 code. A currency code is generally built from the two-digit ISO 3316 country code and a third letter for the currency. Although “BTC” is often used in the Bitcoin community, BT is the country code of Bhutan. An X-code reflects currencies that are used internationally and so, XE has chosen to use XBT to represent Bitcoin.

The various Bitcoin exchanges you will discover provide you with rates of exchange from the Bitcoin to other currency and many are beginning to include rates from Bitcoin to precious metals. The website www.preev.com is one such free service, but it’s not an exchange. You’ll want to use “XAU” as the code for gold and “XAG” for silver since these may not be in the drop-down box.

Bitcoin Mining – ASIC and Authentication

Let’s go back to the mention of how Bitcoins come into existence, through Bitcoin “mining”.

Mining is the process of adding transaction records to Bitcoin ‘s public ledger of past transactions. This ledger of past transactions is called the block chain as it is a chain of blocks. The block chain serves to confirm transactions to the rest of the network as having taken place.

Developers use computer clusters to solve complex mathematical equations and verify transactions, thereby earning, or “mining,” Bitcoin .

The act of generating new Bitcoins and of tracking Bitcoin transactions go hand in hand, and both are accomplished through a process known as “mining”. This is where it starts to get a little complicated.

Basically, mining occurs when a computer or a network of computers runs Bitcoin software. That software creates new entries in Bitcoin ’s public record of transactions, called block chains. The math is complicated and hard to forge, so the block chain stays accurate. Because anyone can download and install the Bitcoin software for free, the payment processing and record-keeping for Bitcoin is done in a widely distributed way, rather than on one particular server.

When block chains are created, so are new Bitcoins — but there’s a hard limit to how many will ever exist. The system was designed to create more Bitcoin s at first, then to dwindle exponentially over time. The first set of block chains each created 50 Bitcoins. The next set each created 25 Bitcoins, and so on. New block chains are created roughly every 10 minutes no matter what; when more computers are actively mining, the program they’re running gets harder (and therefore slower) to compensate.

Ironically, Bitcoin s don’t exist anywhere, even on a hard drive. We talk about someone having Bitcoin s, but when you look at a particular Bitcoin address, there are no digital Bitcoin s held in it, in the same way that you might hold pounds or dollars in a bank account. You cannot point to a physical object, or even a digital file, and say “this is a Bitcoin ”.

Instead, there are only records of transactions between different addresses, with balances that increase and decrease. Every transaction that ever took place is stored in a vast public ledger called the block chain. If you want to work out the balance of any Bitcoin address, the information isn’t held at that address; you must reconstruct it by looking at the block chain.

What does a transaction look like? If a person sends some Bitcoin s to another person, that transaction will have three pieces of information: An input. This is a record of which Bitcoin address was used to send the Bitcoin s to the first person in the first place (maybe he received them from his friend a week ago). An amount. This is the amount of Bitcoin s that the first person is sending to the second. An output. This is the recipient’s Bitcoin address.

You need two things to send Bitcoins: a Bitcoin address and a private key. A Bitcoin address isn’t like a bank account; you don’t need mountains of paperwork and identification to set one up. In fact, they are generated randomly, and are simply sequences of letters and numbers. The private key is another sequence of letters and numbers, but unlike your Bitcoin address, this is kept secret.

Think of your Bitcoin address as a safe deposit box with a glass front. Everyone knows what is in it, but only the private key can unlock it to take things out or put things in.

When the sender wants to send Bitcoin s to the recipient, he uses her private key to sign a message with the input (the source transaction(s) of the coins), amount, and output (recipient’s address).

He then sends them from his Bitcoin wallet out to the Bitcoin network. Bitcoin miners then verify the transaction, putting it into a transaction block and eventually solving it.

Please also review http://www.bitcoinmining.com/getting-started/

Bitcoin Exchanges

Even though Bitcoin does not need a third party or a counter party to be involved in transactions (like your bank), they provide much needed services, especially for the Bitcoin user. It’s likely that the more sophisticated Bitcoin users never use exchanges or counter parties, but instead, use Bitcoin in its truest form, peer to peer, or payor to payee.

You can use Bitcoin s for all sorts of real transactions. To do so, you first buy Bitcoin s however you like, either through your credit card, a bank account or even anonymously with cash. Then your Bitcoin s are transferred directly into your Bitcoin account, and you can send and receive payments directly to a buyer or seller without the need for a typical go-between, such as a bank or credit card company.

By skipping the middle man in the transaction, you pay far less in associated fees. Each party in the deal can also maintain a much higher level of anonymity, which has both pros and cons for everyone involved. Think of Bitcoin s as a digital equivalent of a cash transaction. If you’re so inclined, it’s a nearly untraceable way to do business.

Spending or receiving Bitcoin s is as easy as sending an e-mail, and you can use your computer or your smartphone. That simplicity belies the fact that there’s a whole lot of complicated math protecting all of these transactions to maintain their legitimacy and security.

Two of the more popular Bitcoin exchanges are www.coinbase.com and www.blockchain.info. Either of these are recommended when you first get started; however, when you choose other exchanges, if you do, a good decision would involve considering how much investment capital the exchange has raised and it’s customer satisfaction history. It is probably a safe bet that those exchanges that have raised the most investment capital and have had little or no derogatory press would be preferred. I’m sorry to exclude the smaller, but possibly perfectly legitimate exchanges, but many of us are beginners. And maybe this goes without saying but don’t put your entire life savings or net worth into one wallet, especially with a third party exchange. You might even consider using your Bitcoin to buy gold from services such as www.bullionstar.com.

Constructing a Bitcoin exchange involves using the right software and then complying with the rules of the jurisdiction in which the transactions are completed, that is, where your server is located. It makes sense to use the available open source software to build your own Bitcoin exchange that you can use for your own private group of friends and family. This will allow you to transfer your fiat currency into Bitcoin fairly easily, and own the entire process. One such company is just getting started, http://www.bex.io/.

Micro Payments and Marketing

The rise of Bitcoin , the digital cryptocurrency, has resurrected the hope of facilitating easy micro-payments for content online. “Using Bitcoin micro-payments to allow for payment of a penny or a few cents to read articles on websites enables reasonable compensation of authors without depending totally on the advertising model,” writes Sandy Ressler in Bitcoin Magazine.

This could lead to a whole new era of creativity, just like the economy that was launched 400 years ago by the Statute of Anne, which gave people who wrote books, plays or songs the right to make a royalty when they were copied. An easy micro-payment system would permit today’s content creators, from major media companies to basement bloggers, to be able to sell digital copies of their articles, songs, games, and art by the piece. In addition to allowing them to pay the rent, it would have the worthy benefit of encouraging people to produce content valued by users rather than merely seek to draw more web traffic.

Quoting Walter Isaacson, “The key to attracting online revenue, I think, is to come up with an iTunes-easy method of micropayment,” He wrote. “We need something like digital coins or an E-ZPass digital wallet–a one-click system with a really simple interface that will permit impulse purchases of a newspaper, magazine, article, blog or video for a penny, nickel, dime or whatever the creator chooses to charge.” – TIME, February 16, 2009

That was not technically feasible back then. But Bitcoin has now spawned services such as ChangeTip, BitWall, BitPay and Coinbase that enable small payments to be made simply, with minimal mental friction or transaction costs. Unlike clunky PayPal, impulse purchases can be made without a pause or leaving a trace.

Crowd Funding

Crowdfunding is a funding method where common people like you and me, “the crowd” fund your personal or business project with their own money. There’s a term that we commonly use to describe this money-giving action; it’s called a donation.

The main difference between crowdfunding and donation is that crowdfunding is tied to the American JOBS act that allows online sales of small stock to a huge pool of investors, although the act has not been passed yet. Nonetheless, you could still embrace the crowdfunding method to raise your project funds, as long as you don’t sell any kind of stock.

Different crowdfunding site could have different a purpose or approach, but overall the concept is simple – you post your project to a large group of site users, or “potential investors”, and they will fund your project with money if they are interested in the project. you can start a crowdfunding exercise for free as you will only be charged when your project has raised some funds or the full amount. There’s nothing to lose and this is great for publicity.

You will want to search for the top ten crowd funding services and each will better explain the possibilities and how it work with you to launch the project.

Blockchain – Smart Contracts, Public Records

Imagine a world where specific performance of contracts is no longer a cause of action because the contracts themselves automatically execute the agreement of the parties. Or where escrow agents are replaced by rule- and software-driven technology. Imagine instantaneous recording of property records, easements and deeds. Imagine a world where an auto owner who is late on his payment will be locked out of his car. While these scenarios may seem to come from a futuristic fantasy world, innovations offered by the Bitcoin 2.0 generation of technology may create a world where these seeming marvels are an every-day occurrence, and technology renders some contract causes of action obsolete.

Bitcoin and other virtual currencies are powered by blockchain technology, which maintains and verifies all transactions in that virtual currency through a massive, publicly available ledger. The transparency created by the blockchain eliminates the need for trusted third parties, like credit card processors or banks, to take part in these transactions. Because anyone can see the transactions, virtual currency cannot be transferred to more than one party, or “double spent,” which is a key feature that preserves the integrity of the blockchain system. This same blockchain technology can be purposed to facilitate, verify and enforce the terms of agreements automatically without the need for human interaction using what are termed “smart contracts.”

The blockchain, of course, cannot physically enforce a contract, or actually compel a person or entity to do anything. Instead, the blockchain can be used to enforce certain provisions of an agreement that can move an asset from person to person by agreement. Ownership of goods could be associated with a specialized coin, which can be transferred between parties along with payment in a virtual currency system, or in a specialized implementation of blockchain technology.

Examining a simple real estate transaction can demonstrate how smart contracts could drastically alter the way business is conducted. Presently, Party A and Party B would enter into a contract that requires Party A to pay $200,000.00 to Party B in exchange for Party B agreeing to convey title to Party B’s condominium unit to Party A upon receipt of payment. If Party A pays the money, but Party B later refuses to convey title, Party A is required to hire an attorney to seek specific performance of that contract, or to obtain damages. The determination of the outcome will be made by a third party- a judge, jury, or arbitrator. – Andrew Hinkes, insidecounsel.com

Escrow

For some transactions, the possibility of generating “chargebacks” might be very useful. For example, when trust cannot be established between both parties. In such cases, a trusted third party may be very helpful. The fact that Bitcoin transactions for example cannot be reversed by the payor could be an inconvenience or a reason not to use Bitcoin. This problem is alleviated by the use of escrow services that guarantee the terms of the transaction are fulfilled before it’s complete.

You may want to review http://btcrow.com/ and https://bitescrow.org/.

Mixing/Laundry Services

A Bitcoin Laundry or Mixing Service is a service that accepts BTC payments, and returns the same BTC amount, only from coins that are unassociated to the original BTC. It is a privacy service that works well if it has massive usage. It’s my opinion that complete privacy and anonymity are inevitable no matter what regulations are adopted, this concept of “mixing” and “laundering” perfectly legal transactions is just one example.

Jon Matonis had this to say:

As the cryptocurrency arms race escalates beyond identity verification at exchange endpoints, mixing services for Bitcoin may emerge as the next frontier in the battle for financial privacy.

If Bitcoin exchange regulation becomes so effective that exchange operators are required to link specific Bitcoin addresses to individual customers, then users may have few remaining choices should they want to maintain transactional privacy. Call it the law of unintended consequences for overarching Bitcoin exchange regulation.

Two facets of the growing political debate on anonymizing services are the traditional centralized Bitcoin mixers and the newer decentralized Bitcoin mixers that require a modification to the Bitcoin protocol.

With traditional Bitcoin mixers, the process could become highly-charged politically and the regulatory status of mixing services called into question. Reliable legal jurisdictions for operating Bitcoin mixing services would therefore gain prominence since it reasonably could be viewed as a protected free speech issue. Potentially, Iceland could serve as a Bitcoin mixing haven.

The emergence of services that mingle Bitcoin for the purpose of returning Bitcoin not associated with the original input address has had a somewhat spotty history. Also called Bitcoin laundries, these web-based services charge Bitcoin holders a nominal fee to receive different Bitcoin s than the ones initially transferred. The sites never handle national currencies like the dollar or euro so technically they are not exchanges. Also, the administrator of the service has to be trusted to delete any archival logs and not to run off with the coins.

The largest such service operating today is the Blockchain.info mixing service which has a maximum transaction size of 250 Bitcoin s and a 0.5% transaction fee. Transaction logs are removed after eight hours and customers can use the taint analysis tool to verify that coins were properly mixed. Other services include BitLaundry and The Bitcoin Laundry operated by Mike Gogulski.

Advances on the decentralized mixer front were highlighted in Olivier Coutu’s largely theoretical presentation at the Bitcoin Conference in San Jose. Although it resolves the trusted intermediary vulnerability, the political debate with decentralized mixers revolves around convincing Bitcoin core developers that it is essential functionality or creating a different Bitcoin client altogether. Either development approach would subsequently require majority support from the Bitcoin mining community.

Zerocoin from Johns Hopkins University is a method whereby the trusted intermediary for mixing can be eliminated. The software is already written and soon to be released as open source code. However, it requires modifications to the core Bitcoin protocol and adoption by the majority of Bitcoin miners. With the current political climate tilting towards full disclosure for Bitcoin transactions, at least at the exchange level, it is unlikely that Bitcoin core developers would elevate Bitcoin privacy to an “all-hands-on-deck” emergency priority. Yes, open source projects are comprised of political animals as well.

According to Johns Hopkins University cryptography professor Matthew Green, Zerocoin researchers are examining voluntary compliance options that reduce but don’t eliminate your transaction privacy, such as accountability limits on dollar amounts of anonymous transactions. This type of alternate approach to Zerocoin adoption would be possible without support of the Bitcoin client software. However, not integrating Zerocoin into the Bitcoin protocol would require third-party services to act as issuers of its anonymizing tokens with trust problems similar to the centralized laundry services.

Also, in-person exchange LocalBitcoins.com could act as a pure person-to-person mixing service for Bitcoin users that meet in designated places like cafés. Personal mixing has the additional benefit of introducing plausible deniability into the entire Bitcoin ecosystem because the coins cease becoming provably yours at that point. After seeing the LocalBitcoins selling-for-cash section in the U.S., Carol Van Cleef, a partner in Patton Boggs’ banking practice and adviser on anti-money laundering policies, ominously warned, “You better get yourself registered, or you better get your name off the list real fast.”

Vitalik Buterin of Bitcoin Magazine argues that Bitcoin is not losing its soul through regulation and that the core principles of the Bitcoin protocol, such as user-defined anonymity and user-defined transactional privacy, remain intact due to optional mixing services. This is a critical point because, when it comes to Bitcoin oversight, regulators and law enforcement must comprehend that which can be constrained versus that which cannot be constrained.

Otherwise, legislators and government officials risk inadvertently steering Bitcoin advancements in the direction of even more liberating decentralized architectures. Remember, it was the forceful and horrific crackdown on casual file sharers that provided the impetus for the remarkable BitTorrent technology.

One can only defer the Bitcoin privacy issue for so long. At some point, Bitcoin core developers, mining operators, lobbyists, and industry thought leaders have to take a principled position and decide on what side of history they wish to stand.

QR Codes

To understand paper wallets and storage methods of Bitcoin , you will need to become familiar with QR Codes. Think of the UPC (Universal Product Code) on grocery packaging.

A “QR Code” (abbreviated from Quick Response Code) is a machine-readable code consisting of an array of black and white squares, typically used for storing URLs or other information for reading by the camera on a smartphone. The following QR Code contains this entire paragraph:

You can download a free QR scanner such as “QR Reader” to your iPhone and scan this image and it will regenerate the paragraph you just read into text. Your Bitcoin key can be used to generate a QR Code. You have two keys per wallet, one is the “public key” that everyone can see and one is the “private key” that only you can see. You receive money or Bitcoin by providing other people with your public key, or the QR Code for your public key.

I generated this QR Code via http://goqr.me/, but you will find probably hundreds of free services like this on the Internet with a standard keyword search.

Cold Storage, Paper Wallets and Vaults

Cold storage involves keeping a reserve of Bitcoin s offline, using a method that makes retrieving coins from storage significantly more difficult than sending them there. This could be done for security such as to prevent theft or robbery.

Because Bitcoin s can be sent to a wallet by anyone knowing the wallet address, it is trivial to put a wallet in cold storage while also keeping a copy of the addresses needed to send funds to it.

A simple example of cold storage is opening a safe deposit box and putting a USB stick containing an encrypted wallet file in it. The public (sending) addresses can be used any time to send additional Bitcoin s to the wallet, but spending the Bitcoin s would require physical access to the box (in addition to knowledge of the encryption password).

Cold storage would typically be used for holding large amounts of Bitcoin s, or for a trustee holding Bitcoin s for beneficiaries. In such a case, additional precautions should be taken beyond a simple example of a single safe deposit box.

The box could be accessed by bank or maintenance personnel, so the contents of the box alone should not be sufficient to access the wallet.

The box could be stolen or destroyed in a disaster, or the media could become unreadable, so the box should not contain the only copy of the wallet.

The trustee could die or become incapacitated. If access to the wallet or knowledge of its location is lost, or encryption passwords are lost, the Bitcoin s are gone forever. Provisions should be made so that the box can be accessed by someone else as appropriate, including any encryption passwords.

You can use simple methods that do not involve more electronic technology, such as paper wallets. While you don’t need any special software for paper wallets, there are some very inexpensive kits you can buy for just a few dollars online that make printed wallets look very professional and provide a bit more security using bond paper and certain types of printer toner.

Please see https://bitcoinpaperwallet.com/

Here are examples of the most popular electronic vault storage devices.

The Trezor, no matter how unprotected your computer or internet connection might be, your coins always stay safe with TREZOR as it never exposes your private keys. TREZOR is an isolated environment for offline transaction signing and using a small display you can visually verify the transaction contents. That’s why all operations using TREZOR are entirely safe.

TREZOR is Windows, OS X and Linux friendly. All you need to do is to connect your TREZOR to the computer and follow the instructions. There are only two buttons, to confirm or to deny the action, so using TREZOR is as easy and as intuitive as it can be. Users can backup the whole TREZOR contents on a small piece of paper and use this backup to regain access to all their coins in case of disaster, loss or theft.

The TREZOR website is https://www.bitcointrezor.com/ and it retails for $119.

And then BitStash, Secure wallet for spending on the go. Set a maximum amount to keep on mobile, and the wallet will automatically re-balance, topping back up when in range of BitStash™ Securely receive funds into home and cold storage wallets.

Ultra secure hardware wallet for large balances. Use it for Trading, Online Shopping, Bill Paying, etc. Accessible from authenticated mobile, laptops & desktops when in range of BitStash™.

True cold storage on a LUKS encrypted-USB drive. Immune from BadUSB malware. Safely store in a secure location. Can spend only when plugged into BitStash™. Also holds a fully-recoverable backup of all wallets. It’s website is https://www.bitstash.com/ and it retails for $199.

And the latest innovation is the “Case” from Cryptolabs.

When wallets moved to the cloud, security improved thanks to the use of dedicated servers with regular backups and improved features like two-factor authentication. However, using a secure cloud wallet to send Bitcoin involves a time-consuming process that makes the crypto-currency much more difficult to use than a credit card or other payment option. Shapiro says the pursuit of security has created complexity and led to an extremely cumbersome experience, destroying any incentive for the average user to adopt Bitcoin.

The device is equipped with a fingerprint scanner and a camera to ensure access, keys to access wallets are embedded in a device, located on a specific server and stored in cold storage (access to each key is secured by different layers of authentication).

Because the device is GSM-enabled, the wallet can be used in over 60 countries, and since it can fit in your pocket, Shapiro argues that it may be the first Bitcoin wallet to replace your actual wallet.

The device retails for around $200, with a high sticker price that Shapiro justifies by pointing to all of the hardware on the device. It’ll be available for pre-sale in December and is headed out for its first small-batch manufacturing run in the next two weeks. Once the devices are certified, CryptoLabs will open them up for sale. A news website detailing this device is https://hashtalk.org/topic/18851/cryptolabs-launches-secure-bitcoin-hardware-wallet