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Raúl Marcos' Cryptonews #6: Bitcoin Futures, Cryptokitties, IOTA.

December 16 · Issue #6 · View online
Six Angles
I’m back! Ironically, after leaving my job at Cabify to dedicate myself to cryptos I stopped writing the newsletter. It won’t happen again!
On the bright side, I have a new format: instead of a bunch of links, I will comment every week three or four news in cryptos, with links in case you want to read more. Any feedback would be welcomed!

Bitcoin Futures
The buzzword of these past weeks. After Bitcoin futures were announced, BTC rallied to $17000. Shortly after that, part of that new money started flowing to other cryptos, and almost all of them are at all time highs. Brief explanation:
  • What’s a future? An agreement to transact something, with a fixed price and future date.
  • Why are so important? It basically opens the gates to professional investors (hedge funds, portfolio managers, institutions) to invest in Bitcoin because futures are regulated (exchanges aren’t), and they don’t have to deal with the custody of their bitcoins.
  • When will they be available? Last Monday the first one was launched, next week we will have another one, and others will follow.
  • How will it affect the price? Nobody really knows, we are in uncharted waters. Some people think it will lead to more people knowing Bitcoin and buying, others think it will increase volatility in the short term.
Extra: Joe Lubin, Ethereum’s cofounder, hinted in an interview that Ethereum futures would be announced very soon.
Some guys created an Ethereum-based game where you can buy kitties, breed them with others, and sell them. Every action is written in blockchain and every payment is done with ETH. Sounds fun, doesn’t it?
The problem is that it’s addictive, and a few days after the launch, 30% of the transactions in Ethereum were related to cryptokitties, clogging the network. The capacity of Ethereum’s network, or any other blockchain, can’t be improved magically, you can’t add more servers, so this meant more pending transactions and higher fees.
I find this fascinating: a game developed in a few weeks is executed in a decentralized network and a new kitty-economy is created, with millions of dollars in ETH transferred. You can even build your own version easily. It proves the capabilities of blockchain, but it also shows that projects like Ethereum are not ready for mass adoption (but hopefully next year it will).
In reddit, it’s usual to read people joking that friends don’t let friends invest in IOTA. An important part of the community always has been very critical with some decisions the IOTA developers have made: instead of a binary system they use a ternary one, they decided to implement their own cryptographic functions (a big no) and they intentionally left bugs in their protocol to be able to prevent copycats.
Besides, it’s not clear how their blockchainless solution, the Tangle, is secure: to do a transaction in IOTA you have to verify two, but the difficulty of this verification is fixed, so it doesn’t adapt to the current conditions of the network (Bitcoin, Ethereum, and others do).
This is relevant this week because two articles criticising IOTA were published:
This week I liked...
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