Connect with us

Blockchain

Justin Sun’s JUST NFT Fund Has Released the First-Ever Picasso NFT

Shortly after purchasing a Picasso painting for $20 million, Justin Sun has released the world’s first Picasso NFT through its designated fund.

Avatar

Published

on

NFT fans will be able to enjoy digital visualizations of Picasso’s work as non-fungible tokens courtesy of Justin Sun’s JUST NFT Fund. This initiative is Sun’s latest attempt to bridge the gap between traditional art and its digital counterparty.

JUST NFT to Introduce Picasso’s Work

To take advantage of the growing demand for non-fungible tokens, Justin Sun, TRON’s founder and BitTorrent’s CEO, introduced a new development last month called JUST NFT Fund. Shortly after, Sun acquired a Picasso painting for $20 million to tokenize it on the Fund.

Earlier today, the team behind the project announced the official launch of the NFT for “The First Collections,” which includes Picasso’s work, in a press release shared with CryptoPotato.

The statement explained that the ownership of the collections is mapped to the TRON chain through the blockchain’s TRC-721 standard. As such, it will be “permanently stored on the TRON public chain and BTFS, which marks the ‘first show’ in history of Picasso’s works on the blockchain.”

This marks JUST NFT Fund’s latest initiative to increase the number of actively engaged users with NFTs.

“I firmly believe that in the next ten years, 50% of the world’s top 100 artists and artworks will be NFTized. The JUST NFT Fund will embrace and strengthen this trend.” – commented Justin Sun.

The growth of the sector is exemplified by the total number of sales worth nearly $600 million, the announcement explained. Additionally, roughly 200,000 pieces of encrypted art have changed hands as of today.

Closing the Gap

The PR outlined the Fund’s intentions to reduce the gap between traditional physical art and the growing in popularity sector of NFT, described as a “major innovation of blockchain technology in the field of art.”

Through NFT, the digital format of any physical artwork can be uploaded to the BTFS system, which generates a corresponding NFT artwork’s BTFS address. The information is then written into the smart contract in accordance with the TRC-721 standard, and “the uniqueness of the work is confirmed by the contract address.”

Starting with “such important works of art” like Picasso’s is “more likely to break through the technology circle and attract full attention in the fields of art, collection, investment, and finance, and then to business in these industries.”

SPECIAL OFFER (Sponsored)

Binance Futures 50 USDT FREE Voucher: Use this link to register & get 10% off fees and 50 USDT when trading 500 USDT (limited offer).

PrimeXBT Special Offer: Use this link to register & enter POTATO50 code to get 50% free bonus on any deposit up to 1 BTC.


Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cryptopotato.com/justin-suns-just-nft-fund-has-released-the-first-ever-picasso-nft/

Blockchain

Sanctions Law Implications For Virtual and Digital Currencies in North America

With the increased use of sanctions as a foreign policy tool by western states, individuals and entities transacting with virtual and digital currency,1 but especially virtual and digital currency service providers, should be aware of their sanctions obligations. Sanctioned individuals, entities and countries have warmed to the idea that such currencies may be used to bypass … Continued

The post Sanctions Law Implications For Virtual and Digital Currencies in North America appeared first on CryptoCanucks.

Avatar

Published

on

With the increased use of sanctions as a foreign policy tool by western states, individuals and entities transacting with virtual and digital currency, but especially virtual and digital currency service providers, should be aware of their sanctions obligations. Sanctioned individuals, entities and countries have warmed to the idea that such currencies may be used to bypass the global financial system, through which sanctions are imposed. Flagrant examples of sanctions evasion are causing regulators to pay increasing amounts of attention to virtual and digital currencies.

Notwithstanding that the use of cryptocurrency to evade sanctions remains difficult to detect (given its decentralized nature, limited requirements of digital keys to process transactions, and frequently concealed identities), those who transact in such currency, or facilitate transactions, risk inadvertently dealing with a designated person and assisting prohibited activities in breach of their obligations under sanctions law.

US Sanctions and Virtual/Digital Currency

The United States Office of Foreign Asset Control (OFAC) has previously acted on the use of virtual or digital currencies to evade sanctions. In November 2018, OFAC sanctioned two Iran-based individuals for exchanging Bitcoin into Iranian Rials on behalf of malicious cyber actors. As a first, in addition to adding the two individuals to the Specially Designated Nationals (SDN) List (the list of individuals and entities subject to US sanctions), OFAC included the virtual currency wallet addresses, a unique alphanumeric identifier associated with the wallet, that had been used in the virtual currency exchange, in their respective entries on the SDN List. The specific individuals and wallets were identified by pattern recognition across roughly 7,000 transactions in Bitcoin equivalent to millions of dollars. Other actions taken against the use of virtual currency include a 2019 executive order, by which President Trump prohibited US persons from transacting with Venezuela’s newly issued Petro cryptocurrency.

OFAC’s FAQs confirm that US entities are prohibited from facilitating or engaging in unauthorized digital currency transactions, which include transactions that evade or avoid sanctions or attempt to do so, dealings with blocked persons or property, and/or engaging in prohibited trade or investment-related transactions. For the avoidance of doubt, OFAC also clarified that such obligations extend to technology companies, administrators, exchangers, and users of digital currencies and other payment processors. Entities who find that wallets are owned by, or otherwise associated with, a designated individual or entity, should take the necessary steps to block the relevant virtual asset and file a report with OFAC.

Virtual or digital currency service providers that are not US nationals, and not operating within the US, need to be aware of US secondary sanctions, which target non-US persons and financial institutions with no connection to the US that engage in transactions related to specified economic sectors, as well as individuals and entities included on the SDN List. Penalties for a breach of secondary sanctions include being added to the SDN List, freezing of property and interests in property within the US, denial of visas to the US and restrictions on entry into the US, exclusion from US procurement, and denial of licenses and permissions from US agencies, among others.

Canadian Sanctions and Virtual/Digital Currency

Canada has yet to provide authoritative guidance on the application of sanctions to virtual or digital currencies, however, the general prohibitions included in nearly all Canadian sanctions are broad enough to include any entities operating in the virtual/digital currency space, given that they apply to “any person in Canada or any Canadian outside Canada.” Canadian entities may be in breach of sanctions if they have carried out or facilitated a prohibited transaction.

Recent amendments to the Regulations Amending Certain Regulations Made under the Proceeds of Crime (Money Laundering) and Terrorist Financing, published on July 10, 2019, further regulate virtual currencies, and facilitate any potential investigation into the use of virtual currency to evade or attempt to evade sanctions. These changes will generally enter into force on June 1, 2021.

Once effective, dealers in virtual currencies will be required to register with FINTRAC as money services businesses (MSB), and meet the requirements under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act applicable to MSBs, including having a compliance program in place. Entities that deal in virtual currency will also be subject to record-keeping and reporting requirements that include the maintenance of large virtual currency transaction records for transactions valued at or more than CA$10,000, and virtual currency exchange transactions, where virtual currency is exchanged for funds, another virtual currency, or vice versa. All entities subject to such regulations should consider sanctions avoidance best practices in their required compliance programs to avoid any inadvertent transaction or business with a sanctioned individual or entity.

Additional Compliance Issues and Best Practices

Virtual and digital currencies may also generate sanctions compliance exposure through investment in such services among other acts. For example, administrators and investors in Initial Coin Offerings (ICO) may find themselves subject to potential sanctions liabilities if designated individuals or entities are able to participate in the ICO, or trade tokens issued after the ICO is completed. Further, any virtual or digital currency payment, including crowdfunding, has potential for sanctions liability, if proper screening is not completed to ensure sanctioned participants are not behind such payments.

Best practices for sanctions compliance in transactions with virtual and digital currencies include the use of Know Your Customer, Know Your Transaction, and contractual safeguards.

  • Know Your Customer procedures identify counterparties to transactions and match encrypted keys with individuals in the transaction. This can provide certainty that any counterparty is not a listed individual or entity;
  • Know Your Transaction procedures, including due diligence procedures, can provide a greater understanding of the transaction and underlying business involved; and
  • Contractual safeguards can govern the intended use of any payment in virtual or digital currencies, and ensure that any payment in such currencies is sanctions compliant.

Generally, increased regulatory scrutiny in this area can be expected, alongside similar anti-money laundering trends. Regulators will continue to pursue individuals that transact, attempt to transact or facilitate transactions with entities or individuals targeted by sanctions programs. Service providers and individuals and entities that transact with virtual and digital currencies should take the appropriate technical and legal safeguards for navigating sanctions compliance.

If you have any questions with respect to the foregoing or would like further information, please contact Paul Lalonde or Sean Stephenson.

The authors wish to thank summer student Noah Walters who assisted in the drafting of this article.  


Source: Dentons: Sanctions law implications for virtual and digital currencies

Sharing is Caring

Disclaimer: CryptoCanucks.com is not intended to provide tax, legal or investment advice, and nothing on CryptoCanucks.com should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any asset by CryptoCanucks.com or any third party. You alone are solely responsible for determining whether any investment, asset or strategy, or any other product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. You should consult an attorney or tax professional regarding your specific legal or tax situation.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cryptocanucks.com/sanctions-law-implications-for-virtual-and-digital-currencies-in-north-america/

Continue Reading

Blockchain

Sanctions Law Implications For Virtual and Digital Currencies in North America

With the increased use of sanctions as a foreign policy tool by western states, individuals and entities transacting with virtual and digital currency,1 but especially virtual and digital currency service providers, should be aware of their sanctions obligations. Sanctioned individuals, entities and countries have warmed to the idea that such currencies may be used to bypass … Continued

The post Sanctions Law Implications For Virtual and Digital Currencies in North America appeared first on CryptoCanucks.

Avatar

Published

on

With the increased use of sanctions as a foreign policy tool by western states, individuals and entities transacting with virtual and digital currency, but especially virtual and digital currency service providers, should be aware of their sanctions obligations. Sanctioned individuals, entities and countries have warmed to the idea that such currencies may be used to bypass the global financial system, through which sanctions are imposed. Flagrant examples of sanctions evasion are causing regulators to pay increasing amounts of attention to virtual and digital currencies.

Notwithstanding that the use of cryptocurrency to evade sanctions remains difficult to detect (given its decentralized nature, limited requirements of digital keys to process transactions, and frequently concealed identities), those who transact in such currency, or facilitate transactions, risk inadvertently dealing with a designated person and assisting prohibited activities in breach of their obligations under sanctions law.

US Sanctions and Virtual/Digital Currency

The United States Office of Foreign Asset Control (OFAC) has previously acted on the use of virtual or digital currencies to evade sanctions. In November 2018, OFAC sanctioned two Iran-based individuals for exchanging Bitcoin into Iranian Rials on behalf of malicious cyber actors. As a first, in addition to adding the two individuals to the Specially Designated Nationals (SDN) List (the list of individuals and entities subject to US sanctions), OFAC included the virtual currency wallet addresses, a unique alphanumeric identifier associated with the wallet, that had been used in the virtual currency exchange, in their respective entries on the SDN List. The specific individuals and wallets were identified by pattern recognition across roughly 7,000 transactions in Bitcoin equivalent to millions of dollars. Other actions taken against the use of virtual currency include a 2019 executive order, by which President Trump prohibited US persons from transacting with Venezuela’s newly issued Petro cryptocurrency.

OFAC’s FAQs confirm that US entities are prohibited from facilitating or engaging in unauthorized digital currency transactions, which include transactions that evade or avoid sanctions or attempt to do so, dealings with blocked persons or property, and/or engaging in prohibited trade or investment-related transactions. For the avoidance of doubt, OFAC also clarified that such obligations extend to technology companies, administrators, exchangers, and users of digital currencies and other payment processors. Entities who find that wallets are owned by, or otherwise associated with, a designated individual or entity, should take the necessary steps to block the relevant virtual asset and file a report with OFAC.

Virtual or digital currency service providers that are not US nationals, and not operating within the US, need to be aware of US secondary sanctions, which target non-US persons and financial institutions with no connection to the US that engage in transactions related to specified economic sectors, as well as individuals and entities included on the SDN List. Penalties for a breach of secondary sanctions include being added to the SDN List, freezing of property and interests in property within the US, denial of visas to the US and restrictions on entry into the US, exclusion from US procurement, and denial of licenses and permissions from US agencies, among others.

Canadian Sanctions and Virtual/Digital Currency

Canada has yet to provide authoritative guidance on the application of sanctions to virtual or digital currencies, however, the general prohibitions included in nearly all Canadian sanctions are broad enough to include any entities operating in the virtual/digital currency space, given that they apply to “any person in Canada or any Canadian outside Canada.” Canadian entities may be in breach of sanctions if they have carried out or facilitated a prohibited transaction.

Recent amendments to the Regulations Amending Certain Regulations Made under the Proceeds of Crime (Money Laundering) and Terrorist Financing, published on July 10, 2019, further regulate virtual currencies, and facilitate any potential investigation into the use of virtual currency to evade or attempt to evade sanctions. These changes will generally enter into force on June 1, 2021.

Once effective, dealers in virtual currencies will be required to register with FINTRAC as money services businesses (MSB), and meet the requirements under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act applicable to MSBs, including having a compliance program in place. Entities that deal in virtual currency will also be subject to record-keeping and reporting requirements that include the maintenance of large virtual currency transaction records for transactions valued at or more than CA$10,000, and virtual currency exchange transactions, where virtual currency is exchanged for funds, another virtual currency, or vice versa. All entities subject to such regulations should consider sanctions avoidance best practices in their required compliance programs to avoid any inadvertent transaction or business with a sanctioned individual or entity.

Additional Compliance Issues and Best Practices

Virtual and digital currencies may also generate sanctions compliance exposure through investment in such services among other acts. For example, administrators and investors in Initial Coin Offerings (ICO) may find themselves subject to potential sanctions liabilities if designated individuals or entities are able to participate in the ICO, or trade tokens issued after the ICO is completed. Further, any virtual or digital currency payment, including crowdfunding, has potential for sanctions liability, if proper screening is not completed to ensure sanctioned participants are not behind such payments.

Best practices for sanctions compliance in transactions with virtual and digital currencies include the use of Know Your Customer, Know Your Transaction, and contractual safeguards.

  • Know Your Customer procedures identify counterparties to transactions and match encrypted keys with individuals in the transaction. This can provide certainty that any counterparty is not a listed individual or entity;
  • Know Your Transaction procedures, including due diligence procedures, can provide a greater understanding of the transaction and underlying business involved; and
  • Contractual safeguards can govern the intended use of any payment in virtual or digital currencies, and ensure that any payment in such currencies is sanctions compliant.

Generally, increased regulatory scrutiny in this area can be expected, alongside similar anti-money laundering trends. Regulators will continue to pursue individuals that transact, attempt to transact or facilitate transactions with entities or individuals targeted by sanctions programs. Service providers and individuals and entities that transact with virtual and digital currencies should take the appropriate technical and legal safeguards for navigating sanctions compliance.

If you have any questions with respect to the foregoing or would like further information, please contact Paul Lalonde or Sean Stephenson.

The authors wish to thank summer student Noah Walters who assisted in the drafting of this article.  


Source: Dentons: Sanctions law implications for virtual and digital currencies

Sharing is Caring

Disclaimer: CryptoCanucks.com is not intended to provide tax, legal or investment advice, and nothing on CryptoCanucks.com should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any asset by CryptoCanucks.com or any third party. You alone are solely responsible for determining whether any investment, asset or strategy, or any other product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. You should consult an attorney or tax professional regarding your specific legal or tax situation.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cryptocanucks.com/sanctions-law-implications-for-virtual-and-digital-currencies-in-north-america/

Continue Reading

Blockchain

Mining Bitcoin: How to Mine Bitcoin

Introduction to Bitcoin Mining Mid-19th century California gold miners were called “forty-niners” after the year 1849, but this rush actually spanned from 1848-1853; it took five years for a quarter-million people to flood the state in search of “free wealth”. Satoshi Nakamoto first published the white paper on cryptocurrency back in 2008, and Bitcoin was … Continued

The post Mining Bitcoin: How to Mine Bitcoin appeared first on CryptoCanucks.

Avatar

Published

on

Introduction to Bitcoin Mining

Mid-19th century California gold miners were called “forty-niners” after the year 1849, but this rush actually spanned from 1848-1853; it took five years for a quarter-million people to flood the state in search of “free wealth”. Satoshi Nakamoto first published the white paper on cryptocurrency back in 2008, and Bitcoin was launched in 2009. Today, in 2019, there are at least a million bitcoin miners around the world. A single bitcoin (or “1 BTC”) is worth almost $10,000, give or take a few hundred dollars, and there are around 1,800 new bitcoins mined every day, meaning there’s a whopping $18,000,000 being ‘created’ every day.

Not bad for ten years. No wonder everyone wants to learn how to mine bitcoin.

A Brief History on Money

Cryptocurrency is math that can be used as money.

Money is, fundamentally, an accounting of debt; you owe someone for a good or service, and giving them money erases that debt. Banks are giant ledgers, accounting for every transaction – when you paid for your coffee, this “ledger” sees that you lost $2 and the coffee shop gained $2.

Paper dollar bills do not record this specific transaction – who lost and who gained those $2 – but they act as evidence of a transaction having taken place at some point. In fiat currency, a state is the ultimate arbiter or holder of all the debts – and the one that mints, or makes, the currency in the first place. They account for how much currency they put out, and approximately how much is present now; the only road bump being that they do not know every transaction in between.

In cryptocurrency, no one person or entity controls a central ledger, because this “ledger” is effectively on every computer connected to the network of that currency; everyone has it. Since each unit of the cryptocurrency is composed of math, as opposed to physical substances like paper or gold, this math effectively records every transaction

So Where Does it Come From?

Fiat currencies are “made” (or rather, minted) by states, and accounted for by banks, but these currencies are often directly or indirectly made from precious metals that are mined from the Earth – which is why so many people flooded California in the mid-19th century. Minting is a middle step between the mining and the currency.

Cryptocurrency cuts out that middle step; bitcoin is “minted” and made from BTC mining.

If bitcoin is commercialized math, then mining is the process of solving all its equations. A common, yet accurate, joke explanation is, “imagine if you could solve puzzles, then use those solved puzzles as money”. Bitcoin is that, but on a much larger and astronomically more complex scale; bitcoin mining is both the process of solving puzzles, and the process of verifying other solves puzzles.

That said, these “puzzles” (called “blocks” in BTC mining) are operating on a very complicated scale. BTC mining is basically the process of racing to correctly the correct number out of 115,792,090,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000 possible options – and doing so hundreds, thousands, maybe even millions of times a day. This takes some pretty hefty computing power.

How to Mine Bitcoin

Despite a lot of chatter about bitcoin mining software, it is really a matter of hardware; software is just the most accessible way to access this hardware.

“Winning” or solving – and receiving payout for – is a combination of computational power and a bit of luck. If you accomplish this, you can get about 12.5 bitcoins, though starting in 2020, that will become 6.25. The number of bitcoins you receive for solving a block cuts in half every 210,000 blocks – which is roughly every four years, since the blocks get more and more complicated over time. This will keep going until 21 million bitcoins have been mined, a cap built into the system. There are currently only 3.17 million bitcoin left to be mined.

How to Mine Bitcoin in the Hard(ware) Way

There are two types of “miners” you can buy: application-specific integrated circuit (ASIC) or graphics processing unit (GPU). These are not only very expensive to buy, but they also take up a lot of electricity and require a powerful network connection. This is why mining calculators exist – these are various apps and sites into which you can input details on your miner, your power cost, and your network cost, to figure out how much profit (if any, even) you will turn.

It is usually pretty low, and these days, mining with your own hardware is only really advised for people who already happen to have lots of hardware and great network on hand, and would not need to go out of their way to get those.

That just leaves…

How to Mine Bitcoin With Bitcoin Mining Software

At 12.5 BTC per block, when bitcoins are worth $10,000 each, that’s $1,250,000 on the line every time you are competing with other miners to “guess the right number” first. This takes far more computer power than most people can afford on their own.

As such, the most common way to get in on BTC mining is to join a collective of miners and “rent” the mining tools – known predominantly as cloud mining.

The biggest advantage is that there is a much lower barrier to entry when you cloud mine bitcoins. The biggest disadvantage is that instead of getting the reward all to yourself, you are splitting those bitcoins with other people, and typically a lot of them. Winning a million dollars doesn’t mean as much when you’re splitting it with a million people.

Step 1: Choose Your Wallet

Before you start working for a job, you want to know how you will be getting your pay. By the same token, before you start mining for bitcoins, you should know where you will keep your bitcoins once you earn them.

Online wallets are typically the most convenient, and easiest to use. They are also typically the most efficient for actually using your bitcoins to purchase goods and services, and you will have your bitcoins even if you lose all your devices. That said, this does put you in a similar position with a bank. If the host is experiencing heavy traffic or DDOS attacks, you may not be able to access your funds, and if they are hacked, you can lose your bitcoins entirely.

Hardware wallets are the opposite extreme. As physical objects, are completely offline, and thus cannot be hacked or otherwise remotely attacked. As long as you have your hardware wallet and a device to access it with, you will be able to access your funds. But what you gain in remote security is lost in personal security; if you lose your device or it’s physically stolen from you, you lose your bitcoins.
The middle-ground between these is “software wallets” or “desktop wallets” (though these can also be mobile apps). These are on your local device, so even if exchanges go down or are attacked, you still have your bitcoins, and the only way you can lose them to remote exploitation is if you, the specific individual, are targeted and hacked, which is very unlikely. But, it can still be used to conduct transactions and otherwise go online as necessary. That said, this is also vulnerable to loss if you lose your physical device (i.e. if someone steals your computer).

Step 2: Find Your Cloud

Mining companies are the computing clouds or collectives of miners. While joining such a company might be couched in terms of renting the hardware, another way to look at it might be that you are investing.

The amount you invest, or the rate at which you rent, is known as a “mining package”, which you pick once you join a mining company. You can also invest ahead of time in new technology that will be coming out at a later date. That said, investing in something that doesn’t exist yet is always a heavy risk.

There are many sites in which you can find comparisons between companies, including user ratings and reviews. Be careful with the
reviews – while they can be insightful, many are also full of people attempting to get new ‘recruits’ specifically with referral codes, which will net the refer-er a small bonus or profit.

Step 3: Pick Your Pool

A “pool” is basically the team of miners that you choose to join up with, and contribute your invest or computing power. If you are just starting out mining bitcoins, you should start by joining an “older” (or rather, more established and vouched-for) pool, and perhaps one with lower fees. The payout or profit from these will usually be on the low side, but they are also less risky.

As you get the hang of bitcoin mining and learn how pools work, you can start venturing out to other pools that aren’t as established and carry higher risks, but also higher rewards.

Buy Bitcoin, Ethereum, XRP, and other cryptocurrencies on Coinsquare, the world’s home for cryptocurrency.


Coinsquare

Source: Coinsquare: Mining Bitcoin: How to Mine Bitcoin

Sharing is Caring

Disclaimer: CryptoCanucks.com is not intended to provide tax, legal or investment advice, and nothing on CryptoCanucks.com should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any asset by CryptoCanucks.com or any third party. You alone are solely responsible for determining whether any investment, asset or strategy, or any other product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. You should consult an attorney or tax professional regarding your specific legal or tax situation.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cryptocanucks.com/mining-bitcoin-how-to-mine-bitcoin/

Continue Reading

Blockchain

Mining Bitcoin: How to Mine Bitcoin

Introduction to Bitcoin Mining Mid-19th century California gold miners were called “forty-niners” after the year 1849, but this rush actually spanned from 1848-1853; it took five years for a quarter-million people to flood the state in search of “free wealth”. Satoshi Nakamoto first published the white paper on cryptocurrency back in 2008, and Bitcoin was … Continued

The post Mining Bitcoin: How to Mine Bitcoin appeared first on CryptoCanucks.

Avatar

Published

on

Introduction to Bitcoin Mining

Mid-19th century California gold miners were called “forty-niners” after the year 1849, but this rush actually spanned from 1848-1853; it took five years for a quarter-million people to flood the state in search of “free wealth”. Satoshi Nakamoto first published the white paper on cryptocurrency back in 2008, and Bitcoin was launched in 2009. Today, in 2019, there are at least a million bitcoin miners around the world. A single bitcoin (or “1 BTC”) is worth almost $10,000, give or take a few hundred dollars, and there are around 1,800 new bitcoins mined every day, meaning there’s a whopping $18,000,000 being ‘created’ every day.

Not bad for ten years. No wonder everyone wants to learn how to mine bitcoin.

A Brief History on Money

Cryptocurrency is math that can be used as money.

Money is, fundamentally, an accounting of debt; you owe someone for a good or service, and giving them money erases that debt. Banks are giant ledgers, accounting for every transaction – when you paid for your coffee, this “ledger” sees that you lost $2 and the coffee shop gained $2.

Paper dollar bills do not record this specific transaction – who lost and who gained those $2 – but they act as evidence of a transaction having taken place at some point. In fiat currency, a state is the ultimate arbiter or holder of all the debts – and the one that mints, or makes, the currency in the first place. They account for how much currency they put out, and approximately how much is present now; the only road bump being that they do not know every transaction in between.

In cryptocurrency, no one person or entity controls a central ledger, because this “ledger” is effectively on every computer connected to the network of that currency; everyone has it. Since each unit of the cryptocurrency is composed of math, as opposed to physical substances like paper or gold, this math effectively records every transaction

So Where Does it Come From?

Fiat currencies are “made” (or rather, minted) by states, and accounted for by banks, but these currencies are often directly or indirectly made from precious metals that are mined from the Earth – which is why so many people flooded California in the mid-19th century. Minting is a middle step between the mining and the currency.

Cryptocurrency cuts out that middle step; bitcoin is “minted” and made from BTC mining.

If bitcoin is commercialized math, then mining is the process of solving all its equations. A common, yet accurate, joke explanation is, “imagine if you could solve puzzles, then use those solved puzzles as money”. Bitcoin is that, but on a much larger and astronomically more complex scale; bitcoin mining is both the process of solving puzzles, and the process of verifying other solves puzzles.

That said, these “puzzles” (called “blocks” in BTC mining) are operating on a very complicated scale. BTC mining is basically the process of racing to correctly the correct number out of 115,792,090,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000 possible options – and doing so hundreds, thousands, maybe even millions of times a day. This takes some pretty hefty computing power.

How to Mine Bitcoin

Despite a lot of chatter about bitcoin mining software, it is really a matter of hardware; software is just the most accessible way to access this hardware.

“Winning” or solving – and receiving payout for – is a combination of computational power and a bit of luck. If you accomplish this, you can get about 12.5 bitcoins, though starting in 2020, that will become 6.25. The number of bitcoins you receive for solving a block cuts in half every 210,000 blocks – which is roughly every four years, since the blocks get more and more complicated over time. This will keep going until 21 million bitcoins have been mined, a cap built into the system. There are currently only 3.17 million bitcoin left to be mined.

How to Mine Bitcoin in the Hard(ware) Way

There are two types of “miners” you can buy: application-specific integrated circuit (ASIC) or graphics processing unit (GPU). These are not only very expensive to buy, but they also take up a lot of electricity and require a powerful network connection. This is why mining calculators exist – these are various apps and sites into which you can input details on your miner, your power cost, and your network cost, to figure out how much profit (if any, even) you will turn.

It is usually pretty low, and these days, mining with your own hardware is only really advised for people who already happen to have lots of hardware and great network on hand, and would not need to go out of their way to get those.

That just leaves…

How to Mine Bitcoin With Bitcoin Mining Software

At 12.5 BTC per block, when bitcoins are worth $10,000 each, that’s $1,250,000 on the line every time you are competing with other miners to “guess the right number” first. This takes far more computer power than most people can afford on their own.

As such, the most common way to get in on BTC mining is to join a collective of miners and “rent” the mining tools – known predominantly as cloud mining.

The biggest advantage is that there is a much lower barrier to entry when you cloud mine bitcoins. The biggest disadvantage is that instead of getting the reward all to yourself, you are splitting those bitcoins with other people, and typically a lot of them. Winning a million dollars doesn’t mean as much when you’re splitting it with a million people.

Step 1: Choose Your Wallet

Before you start working for a job, you want to know how you will be getting your pay. By the same token, before you start mining for bitcoins, you should know where you will keep your bitcoins once you earn them.

Online wallets are typically the most convenient, and easiest to use. They are also typically the most efficient for actually using your bitcoins to purchase goods and services, and you will have your bitcoins even if you lose all your devices. That said, this does put you in a similar position with a bank. If the host is experiencing heavy traffic or DDOS attacks, you may not be able to access your funds, and if they are hacked, you can lose your bitcoins entirely.

Hardware wallets are the opposite extreme. As physical objects, are completely offline, and thus cannot be hacked or otherwise remotely attacked. As long as you have your hardware wallet and a device to access it with, you will be able to access your funds. But what you gain in remote security is lost in personal security; if you lose your device or it’s physically stolen from you, you lose your bitcoins.
The middle-ground between these is “software wallets” or “desktop wallets” (though these can also be mobile apps). These are on your local device, so even if exchanges go down or are attacked, you still have your bitcoins, and the only way you can lose them to remote exploitation is if you, the specific individual, are targeted and hacked, which is very unlikely. But, it can still be used to conduct transactions and otherwise go online as necessary. That said, this is also vulnerable to loss if you lose your physical device (i.e. if someone steals your computer).

Step 2: Find Your Cloud

Mining companies are the computing clouds or collectives of miners. While joining such a company might be couched in terms of renting the hardware, another way to look at it might be that you are investing.

The amount you invest, or the rate at which you rent, is known as a “mining package”, which you pick once you join a mining company. You can also invest ahead of time in new technology that will be coming out at a later date. That said, investing in something that doesn’t exist yet is always a heavy risk.

There are many sites in which you can find comparisons between companies, including user ratings and reviews. Be careful with the
reviews – while they can be insightful, many are also full of people attempting to get new ‘recruits’ specifically with referral codes, which will net the refer-er a small bonus or profit.

Step 3: Pick Your Pool

A “pool” is basically the team of miners that you choose to join up with, and contribute your invest or computing power. If you are just starting out mining bitcoins, you should start by joining an “older” (or rather, more established and vouched-for) pool, and perhaps one with lower fees. The payout or profit from these will usually be on the low side, but they are also less risky.

As you get the hang of bitcoin mining and learn how pools work, you can start venturing out to other pools that aren’t as established and carry higher risks, but also higher rewards.

Buy Bitcoin, Ethereum, XRP, and other cryptocurrencies on Coinsquare, the world’s home for cryptocurrency.


Coinsquare

Source: Coinsquare: Mining Bitcoin: How to Mine Bitcoin

Sharing is Caring

Disclaimer: CryptoCanucks.com is not intended to provide tax, legal or investment advice, and nothing on CryptoCanucks.com should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any asset by CryptoCanucks.com or any third party. You alone are solely responsible for determining whether any investment, asset or strategy, or any other product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. You should consult an attorney or tax professional regarding your specific legal or tax situation.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://cryptocanucks.com/mining-bitcoin-how-to-mine-bitcoin/

Continue Reading
Blockchain12 seconds ago

Sanctions Law Implications For Virtual and Digital Currencies in North America

Blockchain12 seconds ago

Sanctions Law Implications For Virtual and Digital Currencies in North America

Blockchain1 min ago

Mining Bitcoin: How to Mine Bitcoin

Blockchain1 min ago

Mining Bitcoin: How to Mine Bitcoin

Blockchain15 mins ago

PlotX v2 Mainnet Launch: DeFi Prediction Markets

Blockchain17 mins ago

Bitcoin Price Hit 11-Week Low: BTC Retesting The Lowest Weekly Close Since February

Blockchain18 mins ago

North Dakota City to Accept Cryptocurrencies for Utility Bill Payments

Blockchain18 mins ago

Bitcoin Mining Company Vows to be Carbon Neutral Following Tesla’s Recent Statement

Blockchain19 mins ago

Bitcoin Proponents Against Elon Musk Following Heated Dogecoin vs Bitcoin Tweets

Blockchain27 mins ago

Mining Bitcoin: How to Mine Bitcoin

Blockchain39 mins ago

Ethereum, Ethereum Classic, Bitcoin Cash Price Analysis: 16 May

Blockchain39 mins ago

Ethereum, Ethereum Classic, Bitcoin Cash Price Analysis: 16 May

Blockchain39 mins ago

Ethereum, Ethereum Classic, Bitcoin Cash Price Analysis: 16 May

Blockchain39 mins ago

Ethereum, Ethereum Classic, Bitcoin Cash Price Analysis: 16 May

Blockchain58 mins ago

Bitcoin crisis, Elon Musk criticized, Ether thrives, Dogecoin survives: Hodler’s Digest, May 9–15

Blockchain2 hours ago

Elon Musk On Why Dogecoin is Superior to Bitcoin

Crowdfunding2 hours ago

Ethereum Smart Contracts will be Supported with Ontology EVM-Integrated Design Nearing Completion: Report

Crowdfunding2 hours ago

Ethereum Smart Contracts will be Supported with Ontology EVM-Integrated Design Nearing Completion: Report

Blockchain2 hours ago

Tech Mogul Jack Dorsey Doubles Down on Bitcoin As BTC Faces Wave of Criticisms

Blockchain2 hours ago

Solana, Theta, MATIC Price Analysis: 16 May

Blockchain2 hours ago

Solana, Theta, MATIC Price Analysis: 16 May

Blockchain2 hours ago

Solana, Theta, MATIC Price Analysis: 16 May

Blockchain2 hours ago

Top 5 cryptocurrencies to watch this week: BTC, XRP, DOT, XLM, SOL

Blockchain2 hours ago

Bitcoin slips below $46K as correction deepens; institutions keep accumulating

Blockchain2 hours ago

Samsung Galaxy Smartphones To Support Crypto Hardware Storage Device, Ledger

Blockchain2 hours ago

Caitlin Long reveals the ‘real reason’ people are selling crypto

Germany
Esports2 hours ago

Sprout eliminate FaZe from Flashpoint 3

Aviation2 hours ago

PLAY Receives Air Operators Certificate Ahead Of June Flight Launch

Esports2 hours ago

Results for 2021 Call of Duty League Stage 3 Major

AI2 hours ago

Understanding dimensionality reduction in machine learning models

Trending