Roey's Crypto Newsletter #2

Hi folks.

Lots have happened this past week, so I’ve shared some latest news and also, a brief intro into one of the most exciting topics related to cryptocurrencies - privacy.

cheers,

Roey

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Latest News

★ Telegram’s ICO is attracting a lot of attention. Although officially it isn’t advertised, I’ve heard of many funds, VCs and wealthy individuals that got early access to the pre-sale.
It’s interesting to see how the ICO, a mechanism that could potentially disrupt the early stage funding industry by giving access to the “average Joe” investor, had been turned on its head. Those who are “connected” get access to high profile ICOs (Filecoin, Telegram are just recent examples), while smaller investors are left with riskier, sometimes shady investments.

★ Weiss Ratings, a traditional Wall Street rating agency, released their cryptocurrencies ratings chart. This caused a lot of stir in the online community, with Bitcoin fans outraged at the low rating (C+) compared to Ethereum and other cryptocurrencies.


Is such an agency even capable comprehending the complex technology behind each coin to be able to rate it? that’s the main claim that crypto fans have been voicing against them.

★ Another day, another exchange hack.
This one seems to have gone relatively unnoticed, which is weird considering the estimated heist is one of more than $400m.

Would you imagine the price of NEM, the coin which was robbed, going up or down? both. Seems like the market doesn’t care much.

★ Are crypto unicorns becoming the new investors?
Stellar and Ripple both have been reported to invest in other startups. Bancor from Israel have also been in the game and is heard to be funding more and more crypto companies.
It seems that wealth accumulation in those companies caused by their coins or tokens appreciating 10-100X in value, caused them to look for ways to spend that wealth, effectively turning them into VCs.

2018 is the year ICO companies become investors, too | TechCrunch

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The rise of ICOs surprised many in the tech industry, helping blockchain companies raise close to $4 billion in 2017, and that’s all set to continue with a..

What is "fungibility", and why it is important.

(from Wikipedia): fungibility is the property of a good or a commodity whose individual units are essentially interchangeable.
One of the properties of money is that it’s fungible. When you go with your central bank notes (cash) to a supermarket, you expect them to be accepted as money, no matter where they came from.



Same goes for Bitcoin or any other cryptocurrency claiming to be money.


But a recent incident puts Bitcoin’s fungibility property at a debate.

Someone online claimed to have bought a big amount of Bitcoin in an OTC transaction. OTC = Over The Counter, outside of an exchange, and usually an unregulated practice.

Later on, that person tried selling those Bitcoins on an exchange, only to have his account frozen without explanation. His Bitcoins seemed to have been tainted as related to money laundering.

Will we see more of this in the future? will the government try to claim that some Bitcoins are different since they came from an illegitimate source? In that case, who is to blame? When buying a cryptocurrency, are we supposed to run our own KYC\AML (Know Your Customer, Anti Money Laundering) process against the party from which we’re buying from?
Some privacy fans might be concerned, but I predict that these sort of incidents will only accelerate the rate of development for better privacy solutions to Bitcoin, or promote the use of real anonymous coins such as Monero.

Aim, Fire: Bulletproofs Is a Crypto Privacy Breakthrough - CoinDesk

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There’s a new privacy technology in the crypto Wild West, and if the rate at which it’s winning favor from developers is any sign, it’s one to watch.