Bitcoin and Cryptocurrency as a Payment Method – Part 2

Bitcoin Cards for Payment

In our previous article, we discussed bitcoin’s shortcomings as a payment method. To recap: bitcoin has had astronomic transaction fees in the past, due to how the technology incentivizes its miners to add new blocks to the blockchain. In fact, the transaction fee spiked only a few weeks ago, before coming back down. Slow transaction times also plague the cryptocurrency, opening up the possibility of interference from malicious third parties. Finally, its volatility makes many merchants hesitant to accept it. If a transaction takes three weeks to process, and the value tanks by a thousand dollars (as recently occurred), that’s not going to look good on the balance sheet.

Bitcoin could make structural changes in the future in order to improve its liquidity, but its decentralized nature makes this unlikely. Currently one of the only ways to spend it effectively is to use a debit card.

These have been out for several years now, and many different choices are available to the customer. Essentially, it’s a prepaid card that you dump bitcoin onto and then use just like your debit card. Most, if not all, of the legitimate ones are authorized by Visa and MasterCard, meaning you can use them all across the world.

International travel is one of the few use cases where they make sense. You can determine which fiat you want your bitcoin to convert into when you use it, even holding multiple currencies on the card simultaneously, making it easy to spend your way through a variety of countries. You can also use them at ATMs practically anywhere.

The problem is that you’re not really spending bitcoin. Since it converts to fiat currency at the point of purchase (or before), you may as well use a normal debit card. If you’re trying to get around the world monetary system for political or other reasons, this isn’t the payment method for you.

Along similar lines, Coinbase recently unveiled a crypto gift card. This improves bitcoin’s liquidity by letting you exchange the currency for commercial products from companies like Nike, but unlike the debit cards, you’re severely limited in where you can use it. The main benefit seems to be for people whose banks aren’t letting them convert their crypto back into fiat, and want to spend it on something, anything, while the value remains high.

Ancient payment
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From the golden era of payment methods. Image credit: Wikimedia Commons

Alternatives to Bitcoin

With bitcoin twisting in the wind as a payment method, let’s take a look at two other altcoins.

Dash (DASH)

Dash has a much different transaction authorization system than bitcoin. “Masternodes”, or elite users of the platform who own a certain amount of the currency, can vote to pre-approve transactions by examining a set of factors that mark it as trustworthy or otherwise. Once the transaction is authorized, the merchant receives an approval within seconds, and sometime after that, the transaction is added to the blockchain. This is similar to how credit cards work. When you swipe your card, the money is not automatically taken from your credit line; the merchant gets a promise from the card company that the payment is genuine and that the money will come through at a later time. Since this system works perfectly well for entire countries, it seems reasonable that Dash will become the go-to cryptocurrency payment option. The only problem currently is that not many merchants accept the coin due to an overall wariness towards crypto.

Dash has also proven to be much less volatile than Bitcoin. Its value has diminished recently, but the swings have been only in the tens of dollars, not thousands.

Monero (XMR)

Monero solves for another of Bitcoin’s potential problems as a currency: it’s fungibility. Fungibility, in very simple terms, refers to something’s exchangeability. A dollar is fungible for another dollar, four quarters, ten dimes, etc. Bitcoin’s problem is that somewhere down the line, authorities may step in and claim that some of the currency is ‘tainted’ (i.e. unusable) because it was used at an earlier point to pay for illegal goods on the dark market. Bitcoin’s public record of transactions on the blockchain makes this incredibly easy to figure out. It’s like if there was a giant public scroll of the serial numbers of every US dollar and what they were used to buy.

In case this scenario does come to pass, Monero would be a perfect alternative. Its blockchain has more privacy protection than Bitcoin’s — it’s impossible to see what each Monero was spent on.

As of writing, there are many coins and companies looking to solve the spending problem. Further down the line, we’ll take a look at some more examples.

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Will Minor
Will is a writer-at-large for Block Telegraph. A prolific writer and futurist from New York City, he specializes in all things cutting edge. He holds a Masters in the Arts and has taught extensively abroad.

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CoinAgenda Announces 5th Annual Global Conference

Mandalay Bay Hotel CoinAgenda Global Conference

CoinAgenda’s Three-Day Gala Will Feature Speakers, Contests

CoinAgenda has announced its fifth annual CoinAgenda Global Conference in Las Vegas, Nevada. From October 23 – 25, the event will feature 50 initial coin offerings (ICOs) and 25 public blockchain companies, along with 60 cryptocurrency experts.

With a focus on international blockchain trends, speakers will include notable personalities, such as Miko Matsumura, co-founder of Evercoin, and Olga Feldmeier, CEO of Smart Valor. They will present on digital currency trends, Bitcoin price dynamics, and other related topics. The conference will particularly emphasize growing ICOs and security token offerings (STOs).

One of the main aspects of the event is an ICO startup competition, featuring as many as 50 companies. Those interested in competing must enter before the Oct. 9 deadline, although the deadline will be cut short if the maximum number of participants is reached beforehand.

CoinAgenda ICO contestants have been responsible for more than $600 million in funding and $15 billion in market capitalization in the last two years. Any startup that has not launched its ICO, as well as any public or private blockchain below $200 million capitalization, is eligible to enter the contest.  Each contestant will give an onstage presentation of their ICO or blockchain and receive a conference booth, as well as two conference passes. Those who place in the top five spots for ICOs and the top three spots for blockchains will be awarded prizes, as well as publicity in the crypto community at large.

CoinAgenda Global Conference
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Image Credit: CoinAgenda/coinagenda.com

The Conference Hosts Speakers, Panels, and Parties

The conference’s opening day will focus on crypto exchange and blockchain incubators, as well as the current situation of international crypto regulations. Jeremy Gardner, co-founder of the Blockchain Education Network, is slated to participate in a panel on the subject of “Generation Blockchain,” as well as a fireside chat. Mike Jones, CEO of Science Blockchain, will also hold a fireside chat. Additionally, there will be various panels and talks on new crypto infrastructure models. The day will end in a cocktail party at the Moorea Beach Club.

The second day of the conference will feature presentations and panels on the growth and implementation of digital currency funds and the latest movements in blockchain investments worldwide. Enzo Villani, former managing director of strategy at NASDAQ and managing director at Transform Strategies, is scheduled to lead a panel covering the most up-to-date developments in STOs. VideoCoin founder Halsey Minor will also present his thesis on why 2019 will be the year that businesses welcome blockchain technologies in a new era of growth. The conference contest will take place that afternoon, with the day wrapping up with the “Legendary Dinner” hosted in a celebrity mansion.

On its final day, the conference’s activities focus on how to establish the skills and network to survive in the evolving regulatory environment of the industry. It will also feature 50 ICO presentations and investor panels, closing with a party at a Las Vegas mansion.

The conference has a 750-attendee limit. Tickets can be purchased on the CoinAgenda website, as well as by emailing info@coinagenda.com.

Headline 4: Three-Day CoinAgenda Conference Will Showcase Experts and Investor Opportunities

Headline 5: CoinAgenda Global Conference Is a Las Vegas Party with Learning, Investor Opportunities

Sources:

Provided press release

https://global.coinagenda.com/

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Börse Stuttgart Unveils New ICO Platform to Help Blockchain Start-ups

Stock exchange charts

Navigating the Regulatory Minefield

Blockhain-crypto start ups are here to stay, and while most of them are eager to play by the rules, they need a helping hand or two from organizations with expertise in regulatory matters. This regularity environment must walk a tightrope of clarity, best practices, and an aversion to overzealous oversight that risk throttle the industry. We’ve seen the fruits of such a beneficial environment already in Malta, which has formed the vanguard of crypto-friendly countries in Europe, and Estonia, which has designs on a “digital republic“.

However, financial and securities regulations aren’t easy to understand. Very often, start-ups interpret their offering in one way, only to find that regulators have interpreted it rather differently. Take, for instance, the dim view the US Securities and Exchange Commission (SEC), has taken of so-called utility tokens. Numerous start-ups believed their tokens did not fall under the definition of a security due to their ‘utility’ on the platform.

The SEC, following a principle of “Substance over form”, reviewed the aggressive marketing of these tokens and noticed the vast majority of people were buying the utility tokens with the expectation of a future profit. This classification from on high has led to a scramble among ICOs and a full scale swing to Security Tokens, which start-ups hope will avoid regulatory carpet bombing.

This is where Börse Stuttgart, Germany’s no. 2 stock exchange, enters the picture.

Gavel and law books
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ICOs need outside help to avoid the long arm of the SEC. Image credit: succo / Pixabay

 

An Integrated Platform

Börse Stuttgart is developing an integrated service offering for digital currencies, which, they hope, will remove the grey areas that often plague ICO sales. The company will allow blockchain start-ups to conduct their ICOs over their new platform in a transparent manner. The platform offers services in a centralized manner so that the start-ups can work with a single integrated service provider. Börse Stuttgart is also developing a secondary market for the ICO tokens sold over their platform. A secondary market are important for most blockchain-crypto projects, since brings in the much needed ‘network effect‘.

Börse Stuttgart is a well-established player in Germany with their floor-based stock exchange. Retail investors can trade in various products here — equities, securities derivatives, exchange-traded funds (ETFs), and bonds, to name a few. Founded in 1860, and based out of Stuttgart, the company lays claim to broad expertise in various kinds of trading as well as regulation, all of which will come handy for ICO token issuers who use their new ICO platform.

The company is also developing a crypto trading app, named ‘Bison’, which they plan to release in September 2018. Their new ICO platform will follow the release of Bison. Alexander Hoptner, their CEO, is upbeat about the project which sits well with their strategy of promoting digital currencies in a transparent and regulated manner.

Börse Stuttgart isn’t the only stock exchange serious about blockchain and crypto; “SIX”, the company that owns and manages Switzerland’s stock exchange, is building “SIX Digital Exchange” (SDX), an integrated market for cryptocurrencies. Increasingly, it looks like Europe is taking the lead in blockchain and cryptocurrency technology. Time will tell if other global financial powers can keep pace.

 

 

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