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Steemit: A combination of blockchain and social media

When a previously unknown digital currency with a market capitalization of just 14 million US dollars rises to 400 million US dollars within a very short period of time, then the sensation is caused.

If this digital currency also serves as the basis for a social media payment unit that rewards people for creating content, sometimes with several hundred dollars for a single post, then doubts or euphoria quickly arise.

Steemit, which can be described as a “blockchain-based social media platform”, was founded in March and became increasingly well known in July. So far Steemit seems to divide the Blockchain community.

Nonetheless, the Bitcoin loophole platform is making many newcomers familiar with Blockchain technology

Behind the Bitcoin loophole platform are Daniel Larimer, founder of Bitshares and Ned Scott, a former financial analyst. With Steemit, they want to give people a way to create their own content, promote it or comment on other content while making money. Read more here:

But Steemit is much more than just a website where you can earn some small change. The Steemit blockchain is based on a technology developed by Larimer called Graphene, which enables the use of specific blockchain applications.

The rise of Steemit

The big breakthrough came only on July 4 when 1.3 million US dollars were distributed in the form of the digital currency Steem to the platform’s participants, who had previously been involved in mining and providing content.

Scott explains that the reward for the platform’s participants was deliberately not spent before July 4 to test the platform in advance and find bugs before it becomes available to a much larger audience.

After all, despite the careful work of the development team, bugs cannot be ruled out. So the phase before July 4th was used to make Steemit as safe as possible.

That’s what Scott says:

“What happened on July 4th was like a three-month day that finally ended. The distribution of the proceeds is working perfectly today, a moment we’ve been working hard for.

Jeff Gallas: A Talk about crypto trader, Bitcoin Lightning and Hackdays

Jeff Gallas from Fulmo answered our questions in an interview. He discussed with us the Lightning Network and what distinguishes it from other scaling solutions. He also introduced the upcoming Lightning Hackday.

The Bitcoin Lightning Network is known to every crypto enthusiast, but for many a book with seven seals. When it comes to the real technical details, many have to fit in and real experience with Bitcoins’ scaling solution is still limited. This is where the start-up company Fulmo comes in, which wants to clarify Bitcoins about this second layer. Among other things, the young company is doing this with the Lightning-Hackday, which goes into its third round on the first of September. BTC-ECHO therefore sat down with Jeff Gallas to talk about Bitcoin’s scaling solution, the company Fulmo and the event.

How did you get to Bitcoin, crypto trader and blockchain?

Actually, I would like to tell a great story about a retreat in a Thai monastery, where after six weeks of vows of silence I met a young Swiss businesswoman who told me on a warm summer night in a small beach bar about the overwhelming possibilities of this new, revolutionary crypto trader technology. The reality is more profane: I read about crypto trader on a news portal a few years ago. But the fire was no less ignited, with everything that goes with it: sleepless nights, endless monologues with friends and family, in short: love at first sight. And in principle, I haven’t stopped dealing with the subject every day since. By the way, that was at a time when people still said “Bitcoin” and not “Blockchain”. At the moment, the trend is back to that.

As with a prepaid card
The Lightning Network is a Bitcoin scaling solution that allows instant transactions with low fees. Can you explain in simple terms how it works?

The Lightning Network is a network of payment channels. A payment channel is a contract enforceable by the blockchain between two network participants in which it is agreed that payments up to a certain amount can be sent to each other. Bitcoin is stored in the channel for this purpose, similar to recharging a prepaid card. The special feature of the Lightning Network is that the network defines rules of the game that make it possible to pay every participant – even if there is no direct payment channel – risk-free.

Satoshi’s Place and Sweets: Because we can!

Instantaneous, royalty-free transactions not only make buying coffee more convenient, but also offer interesting opportunities in terms of inter-machine communication, faucets or in-game currencies. A few months ago Blockstream presented some Lightning Apps, LApps for short. What is the most exciting development for you in this field?

Satoshi’s Place is a pretty gimmick that wouldn’t work without Lightning, as would David’s candy machine Knezić. There are a lot of interesting projects, many of them playful and “because we can”. And that’s also the most exciting aspect for me: seeing the excitement, trying out new things and seeing where the journey is going. With the Lightning Network, a new platform is being created on which diverse projects can be realised.

“While Shitcoins are still doing marketing, Bitcoin is already scaling.”
Bad tongues say that Lightning makes the system unnecessarily complicated. Asked as the devil’s advocate: What can this scaling solution do that other scaling solutions like larger blocks, shorter block times, (delegated) proof of stake or a tangle cannot?

The Lightning Network differs from these proposals in two ways. First, it is a Second Layer Protocol, i.e. a second layer based on Bitcoin and other blockchains. So it is only one of many conceivable scaling options for Bitcoin in the future that leave the Bitcoin block chain itself untouched. On the other hand, this scaling solution already works. There is an active, growing network in which thousands of payments are made every day. The “scaling solutions” mentioned above live largely from loud announcements, but still have to prove what they can do. Or whether they are suitable for scaling at all. While Shitcoins are still doing marketing, Bitcoin is already scaling with the Lightning Network.

Ledger trade journal publishes first issue

The issue contains 10 peer-review papers including a probabilistic analysis of the NXT “Forging Algorithm”, questions of blockchain governance and theories on social contracts. The publication was formally announced last year. They wanted to give the industry a greater incentive to participate, so they decided to create a platform on which scientists of digital currencies could publish their studies in full length.

The first issue of the news spy has been published

According to the people involved, it took a little longer. The reason was the formalization of the review process. Now that the first publication of the first issue has been completed, the editors are planning a complete publication twice a year and additional articles on the side.

Christopher Wilmer, deputy managing director and principal investigator of the University of Pittsburgh, explained CoinDesk:

“There is growing interest and activity among scientists from Princeton, MIT, Duke, Cornell and a whole list of other universities researching crypto-currencies,” Wilmer said.

Academics to be involved in the crypto industry

Wilmer explained that there have been two main inspirations for the news spy this journal. On the one hand he wanted academics to be involved in the crypto industry and on the other hand he wanted to offer a common place where scientists (even those who want to remain pseudonymous) can share their work.

The publication is funded by the non-profit crypto currency group Coin Center, while the journal is distributed by the University Library System.

The publication accepts submissions in four categories, including scientific articles that are no longer than 4,000 words and reviews that summarize relevant research topics with no more than 6,000 words.

Before an article is published, journal staff insert a hash of the final manuscript into the Bitcoin blockchain. Authors are then encouraged to sign this hash with their public keys.

Embezzlement or securing? Battle over the match pool ICO

Funds worth about 1.500.000 EUR are said to have disappeared from Matchpool. A co-founder makes heavy accusations and leaves the project.

Some time ago we reported about the Matchpool ICO. The goal of the project is a blockchain-based Tinder app – dating on the blockchain. Specifically the basis for a kind of own dating application is to be laid, in which possible payments are regulated by Smart Contracts.

The project was financed by an ICO. Tokens called Guppy or GUP were sold via this ICO. The goal was to sell 60% of the existing Guppy tokens against ether in this Initial Coin Offer – a goal that was achieved very quickly. A certain demand in the community is therefore clearly visible.

Now, however, controversies arose

The CEO is accused of having stolen more than EUR 5 million from the Multisig account at ETH Zurich, which was connected with the discovery.

This unannounced coin movement confirms the concerns of those who have criticized Matchpool from the outset. Even more dramatic is that Philip Saunders, one of the co-founders, made this coin movement public and declared his withdrawal from the project.

Coin Movement for Security: Matchpool Explains Itself

In a blog post on Medium Yonatan Ben Shimon commented on the accusations and the quarrel with co-founders. Regarding the accusation of embezzlement of funds, reference is made to an earlier blog post in which Matchpool explained its risk management strategy: Since the volatility of Ethereum is higher than that of Bitcoin, it was considered sensible to invest part of the money in the more stable Bitcoin in order to hedge the funds. The Bitcoins acquired should be secured on a Trezor Cold Storage.

Regarding the exit of Philip Saunders, the view of Yonatan Ben Shimon is presented. According to him, Philip’s interest has waned. In addition, his work – apart from writing the white paper and implementing the necessary smart contracts – is said to have been rather inadequate, so they wanted to complement the team with more talented developers anyway.

According to Yonatan, after the ICO Philip Saunders wanted to retain his share of the funds he had acquired – which he was denied. This refusal finally led to the current drama about the withdrawal of a co-founder.

So we see that in the aftermath of the ICO there are different sides throwing dirt at a team in dispute. Funds were generally moved, but not in the aforementioned size. The reason is understandable that some people see some red flags here, especially with the money supply at stake – the history of the ICOs knows its scams.

However, the CEO deserves credit for quickly responding to the accusations and for pointing out that something had been planned to minimise the risk anyway. In any case, we will continue to monitor and report on the Matchpool case.