Reports: PayPal meeting with Bitcoin companies for possible integration
Wall Street Journal reports that PayPal officials have been meeting with Bitcoin integration companies, such as Coinbase, during recent weeks.
Citing
people familiar with the matter, the meetings are part of eBay quietly
looking to integrate Bitcoin payments into its Braintree payments
subsidiary, part of its PayPal unit. PayPal has yet to reach any
agreements.
Braintree was acquired by PayPal for $800 million in
September 2013. The company helps online businesses process credit cards
by providing merchants accounts, payment gateways, recurring billing
and credit card storage.
During the past several months, eBay’s CEO Jon Donahoe has made increasingly affirmative comments about the company’s openness to working with Bitcoin.
Source : http://dcmagnates.com
Should Bitcoin Users Trust Hosted Wallets?
In
bitcoin’s early days, there were not many options for storing coins:
users had to download the Bitcoin-QT client to keep the cryptocurrency.
That way, the platform storing the wallet provided as much security
as the user required, with the option of keeping the client offline and
encrypted – away from prying eyes searching for private keys.
In the past few years, though, bitcoin has moved off the PC desktop
onto web services and mobile wallets. And many of these hosted wallets,
as they are called, are managed by a third party.
Users relying on hosted wallets are, in essence, depending on
third-party trust to safeguard their coins. However, hosted wallets are
not created equal. So users must ask the question: can I trust a
particular provider to properly store my bitcoin?
Will O’Brien, CEO of wallet technology provider BitGo, told CoinDesk:
“Ultimately, as bitcoin gains adoption, consumers will trust a wallet provider to be a custodian of their funds. But that trust should not be blind faith.”
Shattered expectations
One of the reasons there is a healthy dose of skepticism in the
bitcoin community towards hosted wallets is because of past breakdowns
in trust from some providers.
Mt. Gox is an obvious case in point, where its slow decline eventually meant users could not withdraw bitcoin from their wallets, followed by the exchange’s total collapse in February 2014 and the loss of those trapped funds.
In another example, last year, wallet service Inputs.io suffered an attack where hackers stole $1.2m from users.
Kent Liu, co-founder of Purse.io, said:
“I’ve heard users say, ‘Hey, I rather trust – insert company – than to trust myself with securing my BTC’. After all, that’s exactly what banks do with our dollars, and no one complains about that.”
However, he believes that cases like Mt. Gox provide good reason for users to take care when placing trust in hosted wallets.
“If a user chooses a hosted wallet, he [or she] essentially transfers
the security liability to the service provider,” he said. “The two
major vulnerabilities are hacking – since centralized wallets are more
desirable to hack – and theft/negligence of the wallet service.”
To the next level
The good news is that there are companies pushing bitcoin wallet
technologies to the next level, fostering a rethink about what a wallet
really is.
“With multi-signature, the wallet keys can be distributed across multiple institutions so you don’t have one single point of failure,” said O’Brien.
BitGo, in particular, recently raised $12m from investors
to develop multi-signature technology for wallets. This improves
both key control and security – something that bitcoin users in the
future might demand from hosted wallet providers.
The business model for BitGo is to focus on providing enhanced wallet
security and provisioning options, selling that technology as a product
to other companies looking for powerful and secure wallets.
Growing choice
Today, there’s an array of wallet options to choose from. The Bitcoin.org website, for example, offers recommendations for different platforms.
People are no longer tied to the original QT desktop client by any
measure. While that is liberating and enabling, though, it also brings
important decisions that a user must make.
One thing people should consider when choosing a wallet is whether or
not they want control of their bitcoin address’s private keys.
This decision could also depend on what specific use the wallet is
destined for: is it for regular spending, or primarily for saving?
“We use a system similar to Coinbase: small hosted wallet, large
cold wallet – Purse is considered a ‘fast’ spending wallet,” said
Purse.io co-founder Liu. His startup allows people to purchase bitcoin
through Amazon buyers, and simultaneously allows its users to spend BTC on the e-commerce giant at a discount.
Liu added that an online, or ‘hot’, wallet is ideal for situations
where transactions are constantly moving around. Many companies use this
internally to ensure enough freely available bitcoin for quick
transactions, while keeping the majority of their funds stored in a
safer ‘cold’, or offline, wallet.
Cold wallets could be considered similar to a traditional bank’s fiat
savings account, while hot wallets are the checking (or current)
account.
Private keys are key
Going forward, control of the private keys might be most important users’ wallet security – no matter if it is hosted or not.
“Every user can protect their coins using public key cryptography and
initiate transactions by signing with private keys only they control,”
say Johann Barbie, a co-founder of SMS-based wallet provider 37Coins.
In fact, it may a slight distortion to call 37Coins a wallet company –
at least when Barbie explains exactly what the company does:
“We provide a service that secures wallet transactions through multi-signature and second-factor verification. One key is kept with the partner, one key with 37coins and a third one with a legal entity for backup.”
That sounds like an ideal wallet situation, one many experienced
bitcoin users might appreciate. Problem is, most new bitcoiners are not
fully up to speed on bitcoin wallet technology.
In those cases, users won’t care if they don’t have control over their keys, or if transactions are being done on- or off-block chain, which is in and of itself a contentious subject for some.
Jaron Lukasiewicz, CEO of New York-based bitcoin exchange Coinsetter,
says that his company has built in-house wallet tech for cold storage
and manual withdrawal reviews, among other security measures.
He believes in the importance of users finding the wallet solution that best suits them.
Consumer-facing solutions might just be good enough to get started, for
example. But those trying to protect larger amounts of bitcoin need to
do their research, or at least find someone to investigate the right
option for them.
“Every wallet provider is different, and the best way to understand
which is suitable for one’s needs is to read documentation released by
the provider and to understand the technology behind it,” Lukasiewicz
said.
He added that, ultimately:
“Trust is created when the wallet’s technology is matched by the people running it.”
Source : http://www.coindesk.com
Bitcoin gives Overstock's bottom line a boost
Overstock's chief executive tells Reuters he expects the site to do $1 million in bitcoin sales per month by the end of this year.
Overstock's decision to introduce a bitcoin payment option earlier this year appears to be paying off.
Bitcoin sales have hit $2 million dollars since the e-marketplace started accepting the digital currency for payments in January, Chief Executive Patrick Byrne said in an interview with Reuters published on Thursday. While that's less than one percent of Overstock's total sales, Byrne expects bitcoin usage to accelerate on the site to $1 million in sales per month by the end of the year. So far, sales from the digital currency have totaled $300,000 a month, reported Reuters.
As bitcoin has become more accepted by mainstream retailers over the last year, it has also sparked debate. Lawmakers around the world have both railed against the autonomous digital currency, saying its a threat to governments which need to track and maintain currency value, and praised it as a technology that could improve commerce.
Bitcoin's chief advantage over standard payment options is that it creates a nearly anonymous transactional experience for customers and retailers. The technology is designed to protect peoples' identities and shroud who is buying a good or service.
Overstock was one of the first major retailers to accept bitcoin payments. The company uses Coinbase, a third-party payment processor, to handle the transactions. For retailers, the acceptance of bitcoin presents an important opportunity: lower transaction fees. Transaction fees for bitcoin payments are typically less than one percent, that's less than a third of most credit card transaction fee.
While Overstock, and other prominent retailers like NewEgg and Dell, have decided to accept bitcoin payments, Amazon has shunned the currency. Earlier this year, Amazon said that it had no interest in accepting bitcoin, adding that its customers have not said "that it's right for them."
Still, Overstock's success with bitcoin speaks to the popularity of the cryptocurrency and the way it's impacting commerce. Bitcoin had some troubles in the last year, most notably with the theft of 750,000 customer bitcoins from the Mt. Gox exchange, but it continues to have a strong conversion rate. As of this writing, a single bitcoin is worth $506.76.
CNET has contacted Overstock for additional comment on bitcoin. We will update this story when we have more information.
Source : http://www.cnet.com
Fold’s Scannable Barcode App Aims to Streamline Bitcoin Payments
A
new mobile bitcoin payments app is seeking to present digital currency
consumers with a convenient, all-purpose spending solution.
Fold, the latest effort from the makers of Coin For Coffee and Card for Coin, enables
consumers to make bitcoin payments using a mobile app that can
integrate with a variety of point-of-sale (POS) systems.
Like its creators’ previous products, Fold allows consumers to spend
bitcoin by producing scannable barcodes that resemble those on
traditional gift cards. While Coin For Coffee focused exclusively on
Starbucks locations, Fold will support purchases at US retail giant Target, as well as the popular coffee seller.
CoinDesk spoke with Card For Coin co-founder and CEO Matt Luongo,
whose team is currently on focused on preparing Fold for beta. He said
that the project builds on the experiences – both positive and negative –
gleaned during Coin For Coffee’s development and deployment:
“We learned with Coin For Coffee. We confirmed our hypothesis that people want to spend their bitcoin, which is fantastic, and so far, I think we’ve run through most of the strange situations you can get.”
Luongo added that communication with the major brands involved, most
notably Starbucks, has been open and helpful to the broader
developmental process.
Pitch for merchant payments
Like Coin For Coffee, Fold will function as a bitcoin wallet,
allowing users to load funds onto the card and use them for purchases.
By using a mobile app, Luongo said that Fold can sidestep problems
associated with products like Xapo’s bitcoin debit card.
After the user selects how much bitcoin they want to spend, the app
produces a barcode that is scanned at the register. Any leftover bitcoin
is then sent back to the wallet for future use.
According to Luongo, conversations with Starbucks have advanced since
the Coin For Coffee days. Notably, he claimed the popular coffee
company reached out to Fold and demonstrated a desire to learn more
about digital currency and Coin For Coffee’s experience thus far.
After initial launch, Fold intends to reach out to additional
merchants who may be interested in integration by way of commonly used
gift card technology.
Luongo said:
“There is a huge opportunity here to go after any merchant that uses similar gift card technology. Most of these merchants aren’t ready to tackle [bitcoin] yet, but they’re very interested to see what numbers we have and what issues we run into.”
Development moves forward
Looking ahead, Luongo sees a public beta in the near future.
Currently, prospective users are invited to sign up for updates, and in
time, the Fold team will begin sending out invitations.
Luongo cited enthusiasm among the project’s fan base, as well as
carry-over users from the Coin For Coffee project, as key factors that
could propel Fold forward on launch. He said that this support is key to
the project’s success, noting that several hundred individuals have
already signed up to receive information.
Additionally, a recent resurgence of interest in Coin For Coffee has
netted the project a new influx of supporters, individuals that Luongo
expects will take part in any beta test.
When asked about the future of the bitcoin payments infrastructure
and whether debit cards or mobile apps will be the top choice, Luongo
said that the use cases are fundamentally different. However, he
acknowledged the problems experienced by Xapo and said that
mobile-oriented methods are, in his opinion, the stronger of the two:
“Ultimately, I think that gift cards and mobile are a lot more akin to cryptocurrency than these old card-based systems.”Source : http://www.coindesk.com
Bitcoin ATMs Boom: Canada’s Big Aspirations, First BTM in Bulgaria and More
More and more Bitcoin ATMs are popping up
in various locations all over the world. If you have to cash out your
Bitcoin whenever you need to spend it, these machines make it easy to do
so, while giving investors opportunity to develop a profitable
infrastructure and giving merchants a first-adopter advantage.
New Skyhook ATM in Atlanta
A new Bitcoin ATM machine was placed in Atlanta at The Goat Farm, Warhorse Café. It is produced by Skyhook,
which hopes to continue its mission of providing small-scale bitcoin
entrepreneurs with the means to establish ATMs and create
grassroots-level exchange locations, as the company wrote:
“Our goal with Skyhook has been to make it possible for everyone to become a bitcoin exchange, so that the buying of bitcoin is easy, accessible, and not restricted to a single central source.”
The ATM launch in Atlanta was already commented on Reddit. Users were
claiming that in order for the investors to get their money back, the
fee for transactions should be high and discouraging for potential
clients – “If you charge a 1% fee, you have to sell US$100,000 in
Bitcoin to pay for the machine. I bet most of the units sold will never
reach that amount transacted through it.”
Although, the owner of the bitcoin machine replied: “Not expecting to
make a profit. I have the machine set at 0% fee. Just want to spread
the bitcoin love.”
Oregon’s cryptocurrency ATM draws community attention
The second new cryptocurrency ATM is located in Float On, Portland,
Oregon. According to provider’s information, the machine is the first
one with state approval in the region, being the true blue two-way
crypto-currency exchange.
Comments on Reddit draw attention to storage of complex data – and
users seem to be unsure about its safety. One of the examples is the
requirement of fingerprints. The company respond to these doubts:
“Sorry that disappoints you, we still have not fully worked out our tiered AML and KYC policy yet, but fingerprints are only used to tie to the SMS number used, and any other data collected.
USA requires us to comply with all Anti Money Laundering and Know Your Customer laws as your local Bank Branch, we are just doing it with a machine, and software, and in a minute or two you get bitcoin, simple as that. If you want to sell us coin, no confirms for anything under $100, anything more than that and it's one confirm, and you get cash.
We also only require SMS and Fingerprint up to $1000 and we are trying to fight for less and less AML and KYC, please don't hate on Fingerprints, or Photos of your ID on site for transactions over $1000, it's to appease the great Overlords the Fed. We are trying to make it SAFE and 10x easier to get large-ER amounts of coin bought or sold for cash, than dealing with local-bitcoins and possible scams.”
The main point of the fingerprint protection is the identity
verification which seems to be still one of the main solutions
preventing from using one’s identity to withdraw bitcoins and use them
for buying illegal items.
“This makes ABSOLUTELY certain, that someone cannot buy bitcoin, under YOUR identity, in the physical world, by either forging your ID, stealing it and your phone, or a multitude of other ways Identity theft happens.”
First Bitcoin ATMS in Santa Barbara and Bulgaria
Some other new locations of cryptocurrency ATMs include Lamassu
Bitcoin ATM machine in Sofia at the Interpred WTC Sofia and the
Ouroboros Research machine in Santa Barbara, CA.
The Bulgarian ATM is the first known publicly available Bitcoin ATM
in the country, which is operated by BITCOIN BULGARIA LTD. The detailed
instructions about how to find an ATM in the Block B of Interpred WTC
Sofia can be found on the operator's site Bitcoin Bulgaria ATM. Their current fee is 4%.
Regarding the second ATM, Ouroboros Research which provides the full exchange service for Bitcoin and Litecoin can be found in Santa Barbara. Merchant’s Exchange Rates can be found here.
Canadian Virtual Exchange investing in 10 new bitcoin teller machines
Now, thanks to CAVIRTEX,
naming itself the Canada’s largest bitcoin exchange and service
provider, the region of Toronto and Mississauga may become the area with
the biggest amount of BTMs in the world.
- CVIRTEX's Canada-themed BTMs
CAVIRTEX business directions shows their belief that the digital
currency will continue to grow in popularity despite some recent
controversies. Their philosophy is to develop the Bitcoin accessibility
to allow people to instantly transfer money to anyone over the Internet,
with little or no fees.
“Honestly, I believe it’s the future of money”, said CAVIRTEX’s VP of
business development, Kyle Kemper. “It’s not going to replace national
currencies like the Canadian dollar, but it’s an alternative, and in
terms of where it’s going, I can see great things happening.”
Also, Kemper underlines the role of the owner of coins in the new virtual economy:
“Bitcoin allows its users to remain in full control of their money. With bitcoin, you become your own bank.”
The mechanism of using the BTM contains a few steps: a user will walk
up to the machine with their cell phone, enter their phone number into
the machine, and will get a text message with a confirmation number,
which they will then enter into the BTM.
They will then have to scan their wallet address (a “wallet” in
bitcoin world is your own private online bitcoin repository) or if they
don’t have a wallet, the machine will print out a paper wallet with a
code to scan.
The user will then place cash in the machine and press done, and the
corresponding number of bitcoins will then be purchased from a bitcoin
holder looking to sell, and then deposited in the user’s account. A
confirmation receipt will then be printed.
Each transaction is recorded in a ledger, which is viewable to all
bitcoin users and the machines are capable of buying and selling up to
US$3,000 worth of bitcoins in the Canadian marketplace.
Despite the enthusiasm about CAVIRTEX’s latest venture, there still
are Bitcoin skeptics. Their main issues regard the many establishments
that don’t accept it, government bodies have expressed concern that
Bitcoin is not regulated in the same way as a bank.
Furthermore, the U.S. Consumer Financial Protection Bureau said
earlier this week that customers should be prepared for large price
fluctuations, and that this type of currency can be the target of
hackers and this has some influence on Bitcoin’s value.
Kemper claims that CAVIRTEX has never been hacked, and that it has never lost clients’ funds. As he says, CAVIRTEX reports its business transactions
to the Financial Transactions and Reports Analysis Centre of Canada,
and keeps a “bank equivalent style of client verification system.”
The six BTMs in the GTA will be placed in Gateway Newsstands at the following locations:
Brookfield Place (181 Bay St.), Yonge St. and St. Clair Ave.,
Scarborough Town Centre, Fairview Mall, Yorkdale Shopping Centre,
Square One, Mississauga.
Complete network of Bitcoin Kiosks by XBTeller
XBTeller, a Denver-based digital currency services company has a plan
to create a new network of Bitcoin kiosks across Colorado. The company
started by launching first kiosk in Aurora.
XBTeller, a Denver-based digital
currency services company, has announced plans to launch a network of
Bitcoin kiosks across Colorado. The company’s first kiosk is now
operating in Aurora. Denver, Boulder, Blackhawk and Breckenridge will
follow before the year’s end, the company said in a news release.
What makes the XBTeller Bitcoin ATM different from others? The fact
that it does not only allow Bitcoin accountholders to buy and sell the
digital currency, but also offers new users the opportunity simply to
learn more about Bitcoin.
This educational support includes an interactive content network and
live Bitcoin experts to assist newcomers, answer questions, and provide
other customer service, the release said. As XBTeller CEO Noah Berger
explained:
“The majority of people haven’t heard of Bitcoin. Of those who have, many are misinformed about its purpose and potential, and only a tiny fraction actually own or use it.
“We aim to change that by building an experience that targets the 99 out of 100 people who don’t have a Bitcoin wallet on their phone yet. I think that experience starts best with a conversation and an opportunity to ask questions. It’s hard to walk up to an ATM and feel a personal connection, so we’ve added the human back into the process. The aim of the company is to clear up common misconceptions surrounding Bitcoin, explain security risks, and even send a micro transaction to a new user’s wallet to demonstrate the ease and speed of transactions on the Bitcoin network.”
The company says its kiosk attendants are ready to help throughout the transaction process.
"We want to make sure everyone understands what Bitcoin allows for
right now and what its current limits are. For most people, Bitcoin is
probably best viewed as an experiment they can participate in
voluntarily, not as an investment,” Berger said.
Source : http://cointelegraph.com
Alternative Pin-Up Site SuicideGirls Accepts Bitcoin for Memberships
“The most dangerous global sorority of beautiful pin-up girls that
has ever existed” is now accepting bitcoin for its membership
subscriptions.
SuicideGirls is a popular adult-themed online community that bills itself as a celebration of alternative lifestyles and female empowerment.
Some 2,624 SuicideGirls provide photos, video and blog posts to the
website. Further, the larger SuicideGirls brand has expanded from
photography and video to include comic books, magazines and books since
its launch in 2001.
SuicideGirls first broke the news it would accept bitcoin on Reddit
in a post detailing its excitement about adding the payment option. The
post played off positive remarks issued by the group’s co-founder Missy Suicide in the company’s formal press announcement, a sentiment she echoed in an interview with CoinDesk.
Missy said:
“SuicideGirls was born on the Internet in 2001 and we have always been an enthusiastic adopter of new technologies and advancements that come from the web. [...] Bitcoin is a currency born on the Internet, and we really wanted to support the Internet’s native currency.”
More to see
Missy indicated that accepting bitcoin for its memberships is just
the first step in what could be a larger move by the brand to accept
digital currency. Missy said SuicideGirls is working to next accept
bitcoin at its online store, and it hopes to take bitcoin for ticket
sales at its live burlesque tour this fall.
Memberships cost the bitcoin equivalent of $48 for one year,
$75 for two years and $200 for five years, and provide access to
exclusive photos, videos, online groups and community events. The
company accepts bitcoin payments through merchant processing provider BitPay.
Bitcoin interest
Missy said SuicideGirls has long been interested in developments in
the bitcoin space, and that she personally learned about the technology
through her personal relationship with noted bitcoin investor and
Bitcoin Foundation board member Brock Pierce.
Missy said she worked with Pierce previously and was encouraged to
learn more about the technology due to his own enthusiasm for digital
currency.
However, she suggested that her company’s larger overhaul of its website slowed its ability to add bitcoin payments.
She explained:
“It took us a while to accept bitcoin on our site, mostly because we have spent the last two years rebuilding the site from the ground up responsively and that was just a huge project. It took up all our resources.”
Ideological partners
Though not an adult entertainment site in the traditional sense, the
announcement is the latest that suggests adult-themed online communities
and lifestyle groups are becoming some of the first major brands to
accept bitcoin. For example, Hustler became one of the largest merchants
to accept bitcoin this July.
Despite this business interest, Missy suggested that accepting
bitcoin was a decision that was more ideological than practical, saying:
“When bitcoin is the standard currency for the world one day, we want our early adopter bragging rights, you know? 2014 isn’t as early as we would have liked [to accept bitcoin], but at least we’re in [the ecosystem] now.”
In particular, she noted that bitcoin lacks a strong feature for
rebilling, though she hopes bitcoin customers will become repeat buyers.
“We figured we’d do one-off memberships and hopefully people would
love being a part of our community so much they would go back into
billing settings and buy another year when their first year expires,”
she said.
Subscribers switch to bitcoin
The bitcoin community comprises mainly males, but Missy indicated these demographics did not influence her decision to start accepting digital currency as most SuicideGirls members are women.
Further, Missy revealed the company hasn’t seen a significant
subscriber boost from accepting bitcoin, though she did not reveal exact
figures.
Still, a number of customers, she said, are choosing to pay with
bitcoin. For example, she mentioned that roughly 5% of the new members
that enroll in the community daily are choosing to pay with bitcoin.
Missy said her company remains committed to bitcoin, even if it
doesn’t see a significant business gain from the move, concluding:
“We’re not thinking short term about bitcoin. For us, it is about a long-term investment in a new kind of currency born on the internet that has a passionate community behind it.”Source : http://www.coindesk.com
BitXBay: The First Open Source, P2P Online Trading Platform
Charly Clinton, the creator of BitXBay,
a decentralized and anonymous Bitcoin marketplace, claims to have
created the first open source, peer-to-peer online platform for trade.
The first announcement of BitXBay was made in late-April on the BitcoinTalk forum, following on June 10 by the release of the alpha version with links to BitXBay binaries and sources on GitHub.
BitXBay's marketplace operates through the Bitmessage network for
privacy matters and all transactions occur in the form of escrow with
multisignature addresses. Each transaction creates 3 multisignature
addresses: one for the primary and two for the payment of insurance.
BitMessage is a peer-to-peer
encrypted email communication system created in November 2012, which
grew in popularity in June 2013, right after the disclosure of the
massive surveillance program operated by the American NSA. To ensure
maximum anonymity and privacy, BitMessage email addresses are series of
random letters and numbers, and nodes store all messages for exactly 2
days.
In a recent interview with CoinBrief,
BitXBay creator Charly Clinton announced a lighter version of the
pre-existing system - 300 MB vs. 30 GB. He also informed about the
inclusion of Electrum,
a lightweight Bitcoin client released in November 2011, which encrypts
wallets, and enables its users to recover their wallets from their seeds
with a secret phrase. Also, as private keys are exclusively stored on a
hard-drive, clients don't have to download the block chain.
Clinton said that the idea of BitXBay came to him when he first heard
about Bitcoin. After waiting 4 years to see a similar project surface,
he finally decided to create it himself.
The initiative came with the desire of enabling Bitcoin and
cryptocurrencies holders to buy goods and services as easily as they'd
do in any brick-and-mortar store. He said:
"No trading rules, no registration, no need to enter into a contract or show their documents. Economics has nothing to do with politics or the thoughts of officials that may not concur with my own. I accept no restrictions. I am eager to make my choices myself! BitXBay frees people of all the prohibitions and destroys the chance of influencing free people’s decisions!"
While BitXBay could easily be compared to similar projects such as
OpenBazaar, Clinton noted, "Unlike BitXBay, it is not entirely
decentralized because it’s connected with servers in many respects. Such
decision has its advantages and disadvantages. BitXBay is also more
tolerant as it has no blocking methods for any suggestions."
Clinton said the community responded very positively to his project
on the whole, although he suggested a couple changes and features, as
well as a "Lite version of the software for widespread use.”
Even though, a fully working version is available, Clinton stressed
there is still work ahead for BitXBay, noting that the main problem was
the Bitmessage network instability. He also added that a mobile app
would be released once the next Bitmessage version will be available.
Unfortunately, because Clinton is funding the whole project on his own, BitXBay is developing slowly and not in full.
Source : http://cointelegraph.com
BTC China Launches iOS Apps, Reduces Fees
Exchange
BTC China has relaunched the iOS version of its mobile exchange app,
called simply ‘BTC China’, internationally on Apple’s App Store.
Furthermore, an iOS version of the company’s wallet and
person-to-person bitcoin trading app ‘Picasso’ is also awaiting approval
by Apple, and will feature lowered sending fees.
The new iOS exchange app is largely aimed at traders and has all the features currently present in BTC China’s cross-platform HTML5-based offering, which was released in late July.
These include live candlestick,
market depth and trade history charts, and user interface improvements
including a redesigned trading interface and a dark, more eye-friendly
theme. The app supports three currency trading pairs: BTC/CNY, LTC/CNY,
and LTC/BTC.
Wallet app awaits approval
While the newer Picasso app awaits approval, the BTC China exchange app includes a link to the current version.
Picasso is the exchange’s wallet app with a focus on
regular spending. It also features an integrated ‘sell for cash’ feature
that allows everyday people, business owners and shopkeepers to fulfil
similar functions to bitcoin ATMs without requiring additional hardware.
The apps users have access to live price charts and can set their own trading commissions to sell bitcoins for cash.
It can take up to three weeks for a mobile app to be accepted
for inclusion in the iOS App Store, with Apple also deciding in which
countries’ stores it may be sold.
Reduced fees and confirmation times
To coincide with the release of Picasso for iOS, BTC China has
reduced transaction fees. Starting 11th August, the fee for sending
bitcoin to an external address from a user’s Picasso wallet has been
lowered to 0.0001 BTC (about 5 US cents at time of publication) per
transaction – down from 0.0005 BTC per transaction.
Sending bitcoin to other Picasso accounts remains free, with the funds being transferred instantly.
Additionally, to speed up the user experience, only two confirmations
are needed for bitcoins to be sent to a user’s Picasso address from an
external address. Previously, the app required five confirmations.
Source : http://www.coindesk.com
Wallet Service Integrates Bitcoin Payments with Social Networking
A new Japan-based wallet service called ‘Ninki’ aims to be a social
network for payments, where users build trusted groups who may need to
transact on a regular basis or for a common cause.
Local charity events, crowdfunding campaigns, small- to medium-sized
businesses and international freelancers are among the most likely kinds
of user groups, said the company’s lead developer, Benjamin Smith.
Users can form groups and share details as easily as they can on popular
social networks.
Smith told CoinDesk the aim is to streamline bitcoin payments between transacting parties.
“The idea initially came from seeing how difficult it was for people to exchange and scan QR codes, copy and paste addresses, etc. Even for my tech friends. People get lazy and use the same address all the time.”
What makes Ninki stand out from other bitcoin wallets is its Contacts
list, where users can categorize their contacts depending on their
transaction needs.
Ninki, which means ‘popular’ in Japanese, has undergone extensive alpha testing over the past few months and opened in beta to the public last week.
Testing the beta: signing up and finding others
Registering a new account with Ninki generates quite a few keys and codes, so get ready to take secure notes.
The software generates a public user name and a 15-word public
phrase. These are for others to identify you within the network and so
you can perform a secure out-of-bound validation of the user.
At the user dashboard level Ninki’s interface is in plain language
and straightforward, with all the encryption and security handled
seamlessly in the background.
You can search for other users by username and avatar, adding and
approving them as desired. For one-off payments, you can also send to a
standard bitcoin address.
Making connections and payments
To start building a trust network, simply share your 15-word public
phrase with another user. Upon accepting, the other party will also
share its phrase.
In the background, Ninki performs an exchange of public PGP (pretty good privacy) keys between the two users.
The user dashboard is simple and supplies all information regarding balances, contacts, groups and pending payments.
Users can easily send, receive and pay invoices from a Ninki wallet,
individually or all at once. Each invoice is marked with a date and
order ID number. Users may also reject invoices and check the status and
details of payments on the blockchain.
A PGP-encrypted messaging feature keeps communications between users private.
Smith said security and privacy are priorities at Ninki, especially
given the levels of public mistrust in the security and privacy levels
of ‘everyday’ social networks.
Users can only see lists of members in networks they create
themselves. And while it is possible to add an entire group to a trust
network, the user will only see the name of the group itself and not its
members.
In addition, users can set payment limits by day, per transaction or
by number of transactions per day to prevent losses through error.
Security and identity features
Unlike other social networks, however, Ninki aims to protect users’
private information rather than release or sell it to marketers.
Ninki is not just a wallet service. It is designed to be as secure as
possible, with hierarchical deterministic (HD) wallets as specified in
the Bitcoin Improvement Protocol 32 (BIP32).
This means that a number of wallets can be generated from one ‘master
key pair’ (MKP). Any number of ‘child’ wallets can be created from the
MKP and used independently, but the owner of the master key
retains control over all of them.
Public keys generated on assigned nodes by the public part of the MKP
can be shared between members of Ninki. The users exchange Ninki
phrases and verify them using an outside method of communication, like
email, instant message or a face-to-face exchange.
Multi-signature wallets
Ninki’s wallets are also integrated with multi-signature technology,
two of three possible keys are required for any party to access the
funds. Addresses are generated from the master keys for each transaction
and never re-used.
Ninki holds one key; the user another. A third key is provided for
users to keep in a safe place or with a trusted third party. This means
funds may still be recovered even if Ninki were to disappear.
Smith added that in addition to alpha testing, Ninki would also be
audited by 3rd parties including security experts and hackers. He said:
“Getting cryptography and security right is difficult.”
The greater the number and variety of external checkers, he concluded, the more certainty the security model will be tight.
Source : http://www.coindesk.com
Europe Inches Towards a Decision on Bitcoin VAT
A recent legal referral in the EU may be
inching the region a little closer to more unity on one small element of
bitcoin taxation, but it won’t do much to help global confusion on the
matter.
In June, Sweden asked Europe’s highest court,
the European Court of Justice (ECJ), whether cryptocurrency exchanges
are liable for value-added tax on the fees that they charge for their
services. The result could have far-reaching implications for tax in the
region.
In Europe, there is a directive on
VAT that explains how it should be levied. EU directives are powerful
documents, designed as high-level guides that member states can
interpret when making their own laws.
VAT on profits from bitcoin exchanges
Cryptocurrencies are so new that few member
states have worked out how to interpret the VAT rules for them. Belgium,
Croatia, Cyprus, the Czech Republic, Greece, Hungary, Ireland and Italy
haven’t decided whether to charge bitcoin exchanges VAT on the service
that they provide. Latvia, Luxembourg, Malta, Portugal, Romania and
Slovakia have no regulations on the matter either.
Some other states lie at the opposite end of
the spectrum, with firm rulings on the matter. The UK was among the
first, effectively making bitcoin trading exempt from VAT in a ruling published in March.
While exchanges and miners are off the hook,
though, the UK says that VAT should be charged when goods and services
are sold for bitcoin.
Several states have taken an opposing view. Estonia made its own decision about VAT on profits from bitcoin exchange services, levying a 20% tax on those trading bitcoins as a service. It is also charging a 10% tax on profits from selling bitcoins. Poland has imposed a 23% VAT on bitcoin mining profits, although its position on bitcoin exchanges isn’t clear.
Some states are imposing various taxes on cryptocurrency trades, but not necessarily VAT. Lithuania has said it will tax bitcoin trading as personal income at 5%. Slovenia treats mining
profits as personal income. It won’t tax people selling bitcoins, but
it will examine each case individually. Bulgaria wants a 10% income tax on the sale of bitcoins.
Most of these decisions address a question that Sweden decided it couldn’t answer alone. In June, it asked the ECJ a question that
it couldn’t decide for itself, arbitrating a dispute between the
Swedish tax authority (Skatteverket), and a private defendant, David
Hedqvist.
The question – on the subject of Article 2
(1) of the VAT Directive, which describes what transactions should be
subject to VAT – asked whether people who exchange cryptocurrency for
fiat currency provide a VAT-relevant service; and if they do, whether
that exchange service should be exempt from VAT.
“On most banking transactions, the charges
that the bank makes are exempt from VAT, so you don’t pay them,”
explains Siân Jones, co-lead of the exchanges regulation and accounting
working group for the UK Digital Currency Association
(UKDCA), an advocacy group for digital currencies. Sweden wants to know
whether this applies to the markup charged for virtual currency
exchange.
A decision that could change everything
The ECJ could take up to two years to deliver
a decision, which can then be used by Sweden in its policy making,
explained European tax lawyer Estoban van Goor.
The ruling could prompt other countries to
change their regulations, he warned – or it could even prompt the EU to
pass legislation broadly addressing VAT on cryptocurrency. It’s a
potentially existential issue for European cryptocurrency exchanges,
said van Goor.
An exchange may have to reconsider its business and pricing model, he said:
“If you have an exchange and you apply an exemption, and the tax authorities say we will assess you for VAT, then that could be a game changer for your business.”
VAT on the sale of goods and services for bitcoins
VAT on fees charged for exchanging bitcoins into fiat is relevant to exchanges, which make their money that way, and who are a crucial part of the emerging bitcoin economy. But VAT is also relevant to merchants, who make their money by selling goods and services for bitcoin.
Many countries have been asking themselves
whether those merchants should charge VAT on the sale of goods and
services in exchange for bitcoin.
Ireland’s finance minister has said that while it doesn’t regulate bitcoin as a currency, VAT might be chargeable
on the equivalent value of goods and services exchanged for the
cryptocurrency, and that such a tax would have to be invoiced in euros.
In Spain, private legal opinion suggests adding VAT on invoices sent in bitcoin, and says that bitcoin should be taxed as a service.
In other states, uncertainty reigns. Austria
is floundering. In some countries, legal opinion suggests tax
guidelines, but there appear to be no regulations enforcing it. Legal
opinion in the Netherlands suggests VAT would be due on bitcoins received because of its lack of status as either money or financial product, and based on statements made by government officials.
Double taxes
There is a third VAT question that countries
must answer: should people be charged VAT when they sell their own
bitcoins? Opinion is divided on the matter.
Outside the EU, Norway has made its own
decision about the commercial sale of bitcoins via a website. The
country treats bitcoins as an asset, which renders it taxable. Because
this means that bitcoin isn’t a currency in
Norway, the commercial sale of bitcoins can’t be a considered a
financial service, which would be VAT-exempt. Consequently, as a
VAT-relevant electronic service, selling bitcoins commercially invokes a 25% VAT fee.
In Central and South America, few explicit
rules have been passed with regards to cryptocurrency, although Brazil’s
tax authority has argued that bitcoin is a financial asset rather than a currency. It will tax people selling bitcoins – but only if the value is over 35,000 Brazilian reals (around $16,000).
One of the worries about imposing VAT on the
sale of bitcoin is that in some jurisdictions, it could result in a
double tax for merchants dealing in cryptocurrency – once when they take
bitcoins in exchange for goods and services, and again when they sell
those bitcoins.
Germany, for example, delighted bitcoiners when it announced that bitcoins held for over a year wouldn’t be subject to capital gains tax. But it concerned bitcoin investors and businesses when it recommended a tax on the commercial sale of bitcoin.
The country, which classes bitcoin as a ‘financial instrument’ rather
than a functional currency, classifies its sale as a “miscellaneous
service”, which would invoke VAT.
The danger is similar in some areas outside the EU. In Singapore,
bitcoins are treated as products. Bitcoin investors will be fine there,
because cryptocurrency is treated as capital gains for investment
purposes. This means that if Singapore residents buy and hold bitcoin
for an extended period, it’s tax-free, because there is no capital gains
tax in Singapore.
The story is different for merchants.
Bitcoins are considered a means of barter when used to buy goods and
services in Singapore, and therefore taxable. They’re also subject to
general sales taxes when sold.
This creates the potential for a double or even a triple tax, officials have said. Companies could be taxed when buying bitcoins, when selling them, and potentially when using them as a form of payment.
What is cryptocurrency, anyway?
The ruling from the ECJ could help answer a
more fundamental question about bitcoin that could help countries
resolve multiple issues: what is cryptocurrency? Is it a legal currency?
A financial service? A commodity?
“The answer to this question will be useful,”
said Jones. “If it were goods, it would be a question that they
wouldn’t need to refer to the ECJ. If it was legal tender, it wouldn’t
either. The problem is that virtual currencies sit in this nether
world.”
Other taxes
While there might be an opportunity to
harmonize some aspects of VAT on cryptocurrency in Europe, it will be
far more difficult to achieve a single approach to other taxes, such as
personal and corporate income tax and capital gains. These tax regimes
are decided mostly at a national level.
Broadly speaking, income taxes are calculated
on any income regardless of a country’s particular rules about bitcoin,
argue experts.
“It is pretty clear that any transaction that
otherwise gives rise to income taxes, is still taxable, regardless of
the fact that it is settled in bitcoin,” said Omri Marian, an assistant
professor of law at the University of Florida who wrote a paper on the use of cryptocurrencies as tax havens.
However, the details of some tax applications will differ depending on how the country treats cryptocurrency.
Jones said:
“There are some countries where how it’s classified has a bearing on the tax. So perhaps capital gains on real estate but not other assets. Or if it’s a certain type of asset it may only be subject to capital gains if it’s held for under a year.”
Other regions
In the US, the federal government doesn’t
impose VAT on anything, although national sales taxes are imposed on
certain goods and services.
However, at the federal level, the IRS made a March ruling categorizing bitcoin as property. For investors, this means that capital gains tax is due for investors
selling bitcoin before a year is out. Exchanges may not pay VAT, but
when they sell digital currency to a customer, the gross income equals
the value for which the currency is sold, say lawyers.
But at a state level, things are less
defined. States have generally been slow to issue official guidance on
bitcoin and taxes, according to Marian.
He finds two reasons for the lack of state tax regulation of cryptocurrencies:
“First, states seem more concerned about bitcoin when it comes to consumer finance and investor protection issues.”
He argued that it isn’t yet a major source of tax revenues and doubted where state taxes need much clarification.
“If a transaction is subject to sales tax, for example, it is because the nature of the transaction, not because of the nature of bitcoin. Sales tax will apply to a sale in most states regardless if one is being paid with USD or bitcoin.”
In Canada, not much has changed from a tax perspective since the country’s tax authority released guidance on
the status of cryptocurrency in November. The Canada Revenue Agency
(CRA) still taxes bitcoin as bartered items from a tax perspective,
although in a separate document, it warns that profits from commodity
transactions could be taxed as income.
We also know of several non-EU countries that
have not issued explicit rules for taxing bitcoin presently, but which
are considering the issue. Israel is mulling it over; Australia is behind on tax guidance that it has already promised.
Ultimately, some trading blocks may
eventually establish uniform rules for some taxes as they relate to
cryptocurrency, but Marian warned not to expect everyone in the world to
sing from the same song sheet, on all tax issues.
“Harmonization is a lot to expect for in a world where different countries subject similar transactions to different tax regimes,” he said.
And of course, there’s the other important issue: collection. Marian pointed out:
“Difficulty still exists in the context of administration and collection, given the pseudo-anonymity. The more mainstream bitcoin becomes, the more it becomes a worry for tax evasion, and I think this is where we’re going to see much of the focus.”
Regimes may tax bitcoin all they want, he
added. But first, they have to understand what it is. And then, they
have to understand how to follow the money, commodity, financial
instrument – or whatever they decide to call it.
Source : http://www.coindesk.com
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