Bitcoin Use Cases
https://bitcoinmagazine.com/articles/btcpay-server-launches-tor-crowdfunding-campaign
This week, BTCPay Server created a campaign to help crowdfund Tor. The two week campaign (July 15 - 29) launched with a softcap of $10k - donations already hit $16k worth of bitcoin in just 3 days. Donate here.
Every satoshi is sent directly to Tor’s full node - no fees or middlemen. Donate through onion for maximum privacy.
Flare stacks are primarily used for burning off flammable gas released by pressure relief valves during unplanned over-pressuring of plant equipment (Wiki). Rather than wastefully burning up gas, the Upstream Data team “allows producers to monetize their stranded energy for the first time ever (since 1859) without any need for pipelines or power lines,” by mining bitcoins. Upstream Data just launched their newest product, the Ohmm Mini.
Bitcoin Tech
Rusty Russell made a short proposal to update the gossip protocol that LN nodes use to announce what channels they have available for routing payments and what capabilities those channels currently support. Most notably, the proposal significantly reduces the byte size of messages through two mechanisms: schnorr signatures and optional message extensions.
John Newbery of Chaincode Labs started the Bitcoin Core Review Club back in May. Coindesk covers what it’s like to review Bitcoin’s code.
Matt Corallo of Chaincode Labs submitted a pull request to disable bloom filtering by default, due to its vulnerability to DoS attacks. The PR was merged this week.
Stop and Decrypt, Bitcoiner on Crypto Twitter, writes up on explainer on Matt Corallo’s Better Hash protocol, which aims to distribute mining pools’ signaling power back to their miners, to strip mining pools of their influence for the greater good of the network.
Jimmy Song, a prolific Bitcoin educator, dispels quantum computing FUD in this thread:
Lightning Network
A Brief Technical History of Payment Channels.
BitMEX publishes their research on Lightning “justice” scenarios, ie., when a thief attempts to steal funds on the lightning network, if caught, they do not only lose the money they tried to steal, they lose all the funds in the relevant channel.
Blockstream releases C-lightning 0.7.1.
Gossip improvements
Longer default invoice timeouts
More powerful plugin hooks
External-wallet channel funding
More permissible for peer errors
Performance enhancements
Blockstream also released their research on a million-channel Lightning Network simulation, discussing how to improve the gossip network, routing, and other optimizations.
Bitcoin Products
Is Twitter experimenting with Bitcoin?
Bitcoin Markets / Stats
Banks launder money with the US Dollar, not Bitcoin:
Costliness of money:
Market Cap:
Bitcoin ranks #35 compared to all fiat currencies (no change since last week’s newsletter), placed between the Czech Koruna (CZK) and the Colombian Peso (COP).
Bitcoin represents 65% of the total cryptocurrency market cap (grew ~0.5% since last week’s newsletter).
Supply + Halvening News:
305 days until the next halvening, where the issuance rate of new bitcoins will decrease from 12.5 to 6.25 bitcoins per new block mined. Bitcoin inflation will decrease to 1.8%, rivaling the US inflation rate. We’ve mined nearly 85% of the 21,000,000 bitcoins that will ever exist.
Bitcoin Talks / Theses
Is Ray Dalio advocating for gold, Bitcoin, or something else? He says it’s “a good time to ask what will be the next-best currency or storehold of wealth to have when most reserve currency central bankers want to devalue their currencies in a fiat currency system.”
I wish I had this kind of content when I was first learning about Bitcoin. Conner Brown, former Bcasher, describes common pitfalls (eg. Bitcoin is old tech, Bcash does payments better than Bitcoin, etc.) in learning about Bitcoin in episode 88 of the Stephan Livera podcast: Bitcoin is money, not payments.
Bitcoin Regulations
The CFTC is investigating whether BitMEX allowed Americans to trade on their platform.
Here are the 5 stage of grief: Denial —> Anger —> Bargaining —> Depression —> Acceptance. Here’s how I’d map this week’s hearings to those stages:
Anger
Libra is more dangerous than 9/11
Cryptocurrency disempowers the government with its anarchistic / libertarian strain; cryptocurrency should be illegal
The power of the dollar - the ability to control the banking system - is the key to the American economy
If cryptocurrency goes through, the number of deaths will exceed the following combined: 9/11, heroin deaths, inability to fund cancer research, lack of ability to enforce sanctions, etc.
Cryptocurrency serves no purpose that cannot be met by the USD, except for drug dealers, human traffickers, tax evaders, and sanctions evaders
If Zuckerberg gets his way, he can do what the US Federal Reserve / Treasury can do: print money
You can’t make this shit up.
Bargaining
Though he said “I think there’s no capacity to kill Bitcoin,” McHenry still believes Facebook’s Libra can find a way to enable (1) privacy for their customers and (2) ensure KYC/AML compliance for US regulators. Good luck.
Acceptance
Bitcoin vs. shitcoins
DM me on Twitter if you’ve got feedback, questions, and comments.
This is not financial advice. Do your own research.