Tuesday, May 29, 2012

Bitcoin Poised for Rally

I don't normally like to make predictions, but... (click images to enlarge):

Sunday, May 27, 2012

Enter the Dragon: BTCChina's Volume and Exchange Rate Suddenly Explode Higher

The Bitcoin community has been abuzz over the last 48 hours as trading activity on the only Chinese Bitcoin exchange, BTCChina, has gone stratospheric, with volume 700% above the norm and prices skyrocketing more than 10% higher than the Mt.Gox exchange rate.

Traders on the Chinese exchange are showing no signs of relenting, with 7698 BTC traded yesterday and 8495 BTC already traded today. The last trade was for 35.8 RMB or $5.64 USD, significantly greater than the $5.12 rate on Mt.Gox. With this activity, BTCChina has, at least for the moment, thrust itself into position as the second largest Bitcoin exchange.

Saturday, May 26, 2012

Bitcoin's Liquidity: A Third Look

Back in November 2011, I wrote about Bitcoin's liquidity, and how it had improved from six weeks prior. Let's take a look at how we're doing, six months since:

On October 16th, a $50,000 purchase would have moved the price from $3.40 to $3.92, a 15.3% increase. A sale of $50,000 worth of Bitcoins would have taken the price down to $3.03, or a 10.9% drop.

Friday, May 18, 2012

Bitcoin's Hogwarts: San Francisco Tech Space "20Mission" to Open in August

Jered Kenna, formerly of TradeHill, and Jonathan Ryan Owens of RingCoin have teamed up to launch 20Mission, a huge 41-room tech space project in the heart of San Francisco.

The goal is to open 20Mission to tenants on the 1st of August. Finding tenants will apparently not be a problem, as the reservation list has grown quite long, with prospective tenants even stopping Jared on the street to get in on the action.

Kenna and Owens are hoping the space will produce a wide array of successful projects, most of which will be focused on Bitcoin-related businesses, though the space isn't being advertised as "Bitcoin-only." No doubt, having this much talent concentrated and living in a small space will streamline the development process and encourage the type of brain-storming that could produce exceptional ideas.

In this three-minute video, Jered Kenna takes us for a tour and explains the idea behind 20Mission, including who the building is geared toward, what the spaces will look like, and his crazy plans for the roof:

Sunday, May 13, 2012

GLBSE Valuations, 13 May 2012

This is a snapshot of the valuation of each security on GLBSE with at least 1000 BTC in total volume traded (excluding Pirate bonds, as they are temporary), as of 0700 PDT (UTC-7), May 13th 2012:

Asset24hr AvgIssuedPrivateValuation (BTC)Valuation (USD)

Bitcoinica's Founder to Cease All Involvement with Bitcoin

Hot on the heels of a major hack at Bitcoinica, Zhou Tong, the founder of Bitcoin's most successful Bitcoin project to date, has just announced that he will no longer involve himself in any Bitcoin-related projects:

"I, Zhou Tong... will discontinue all involvement in Bitcoin-related projects after the Bitcoinica incident has been fully resolved until further notice. I failed at one thing... that is generating value for the society. Bitcoinica did create a place for people to trade more efficiently and provide liquidity to the market. However, speculation is a zero-sum game (or negative-sum, strictly saying). I know there can be many justifications for Bitcoinica's value, but all of them are against my intuition and values."

In his announcement, he also revealed that Bitcoinica was actually sold in November of 2011, with the official handover happening in January of this year.

Not surprisingly, he will be moving on to pursue other projects:

"I have started working on another project (not Bitcoin-related) that is going to make a little difference on the Internet. So far I have achieved great progress and I'm pretty confident about this new venture."

Zhou Tong, a 17 year-old developer from Singapore, took the Bitcoin community by storm by creating the first advanced trading platform for Bitcoin. Several security incidents eventually pushed the site to the brink, the most recent being a $90,000 USD theft on May 11th. The site currently remains offline.

Saturday, May 12, 2012

Upcoming GLBSE IPOs - A Review

ZETA-MINING 2012-05-13 @ 18:00:00 (GMT-4)

Yet another mining operation. You will likely receive predictable but small dividends if you invest in Zeta Mining (1 MH/share).

REBATE 2012-05-14 @ 23:18:35

This is definitely the most interesting of the upcoming offerings. Bitcoin Rebate is described as "a blend of penny auctions and arbitrage. Users bid on blocks of Bitcoin (powered by ZipConf) arbitrage opportunities against other players."

The concept of buying more Bitcoins for less Bitcoins might seem like a strange one, but it works if you understand the arbitrage going on behind the scenes. I suspect this will be a very popular and profitable site, at least until the arbitrage space gets a little more crowded and margins fall.

Half of the business is up for grabs (25,000 shares with each earning 1/50,000 of the fees collected by the service). Priced at 0.2 BTC each, this gives Bitcoin Rebate an initial valuation of $50,000 USD).

VirWox Breaks June 2011 Bubble Record for Volume Traded

Bitcoin's fourth largest exchange, VirWox, just posted a record for weekly volume traded of nearly 30 million Linden Dollars (SLL), or $115,000 USD. The previous record was set during the Bitcoin bubble of June 2011.

And in case you think this might be caused by inflation of the Second Life currency, the exchange rate has actually remained extremely stable, holding between 250 and 270 SLL/USD for the last three years. Notably, this exchange rate is managed through "printing" of the currency to keep up with demand.

The largest exchange, Mt.Gox, has seen its market share drop, with weekly volume continuing to dwindle and flirt with yearly lows. The loss of Bitcoinica, which conducted all of its trades through Mt.Gox, will no doubt add to Mt.Gox's woes in the coming weeks and months.

Bitcoinica Shutdown is Potentially Permanent

The latest from Zhou Tong in regards to yesterday's hack and the loss of over 18,000 Bitcoins:
- It's more serious than we thought. We need some additional time to come up with a compensation proposal.

- Likely we will either shut down the platform or re-develop entirely (which will take months instead of days).

- The preliminary decision: reimburse for the full amount, including margin balances and position P/L.

- The root cause of this problem is an email server compromise. The email server belongs to one of our team members.

- Reminder again: Please do not reuse your Bitcoinica passwords as the database server was compromised. Do not click any links in the email. All Bitcoinica announcements will be updated on Bitcoinica website when available.

Important Disclaimer: I'm not a partner of Bitcoinica LP after the corporate reorganisation. Therefore, I have no financial obligation in this matter as I'm only an employee of Bitcoinica LP responsible for daily operations (no shares, no voting). However, I'll do my best with the team to resolve this problem as quickly as possible and minimize the impact for the community. I appreciate your patience and understanding.

Sadly, these events are unfolding only 18 days after ownership of Bitcoinica was transferred to Intersango, who is now left holding the bag.

Friday, May 11, 2012

Meet Kronos.io: Ringcoin's Answer to Bitcoinica

As we continue to digest the news coming from Bitcoinica, another group of developers is working hard to level the playing field in the battle for the Bitcoin CFD space, which until now was monopolized by Singapore's boy-genius, Zhou Tong.

Jonathan Ryan Owens and his team from Ringcoin are fiercely putting together the final code for Kronos.io. Advertised as "Bitcoinica on steroids," Ringcoin will be leveraging their highly touted ZipConf platform to improve the Bitcoin trading experience.

Unlike Bitcoinica, Kronos will utilize the tech behind ZipConf to eliminate its hot-wallet risk, allowing for instant multi-market hedging.

Developing: Bitcoinica "Hacked" - Potentially 18,000 BTC ($90,000 USD) Stolen

Bitcoinica has been shutdown until further notice, following a theft of 18,000 BTC. News of the hack was posted this morning by Bitcoinica's founder, Zhou Tong:
"Today, we have discovered a suspicious Bitcoin transaction that doesn't seem to be initiated by any one of the company owners. Some of them are not online at the moment so this is not conclusive.

Wednesday, May 9, 2012

Bit-Pay Processes Record-High Merchant Transaction of 3095 BTC (~15,000 USD)

Bitcoin's most successful payment processor, Bit-Pay has just set a new record for itself, processing a 15,000 USD transaction between a customer and a merchant in the United States. The purchase was completed in Bitcoins (3095 BTC), with Bit-Pay converting all or a portion of the transaction into US dollars for the merchant.

The merchant? Butterfly Labs, selling one of its 25 Giga Hash mini-rigs.

Tuesday, May 8, 2012

FarmVilleFeed.com (100,000+ Daily Impressions) to Run Bitcoin-Based Advertisements

I've heard a few people suggest that games like FarmVille would be the perfect match for Bitcoin.

Well, Zynga's not exactly ready to take that step, however, ladies and gentlemen of Bitcoin land, I am pleased to announce that the brains behind FarmVilleFeed.com is in the process of creating a specific page on his blog to promote Bitcoin.

He will also be accepting Bitcoin-based ads on his site, which will give Bitcoin entrepreneurs the chance to expose their sites to a blog which receives over 100,000 daily impressions.

Why accept Bitcoin-based ads? Simple: no more payment-processor middlemen to take a cut of your advertising revenue!

Saturday, May 5, 2012

The Bitcoin Stock Market - Miners and Pirates, Oh My!

As of this morning, there are 8.9 million Bitcoins in circulation with a combined value of over $45 million USD. It isn't exactly a secret that a good portion of those Bitcoins are held by speculators and investors hoping to see the currency gain traction and their Bitcoins appreciate in value. All that to say, there is a heck of a lot of money sitting idle and not being put to work. At least, that was the case until recently.

Non-Bitcoiners may not be aware of this, but there is a substantial secondary market where Bitcoins are being used to kickstart (heh) various community driven projects, mostly, at this point, with a view to further developing the infrastructure that overlays and streamlines the Bitcoin economy.

Tuesday, May 1, 2012

ZipConf.com - Waiting for Confirmations About to Become A Thing of the Past

A consequence of Bitcoin's architecture has always been the risk, albeit tiny, of the zero confirmation double-spend.  As a result, most Bitcoin exchanges have made it a point of only accepting a deposit after the Bitcoin network has verified the transaction, with six confirmations being the accepted standard. Typically, wait times are on the order of an hour to complete a deposit to an exchange.

Addressing the problem, ZipConf.com is rolling out a service to eliminate this delay, thus making Bitcoin an even more efficient means of moving your money.

BitInstant Transfers $1.1 Million in April as the Bitcoin Economy Takes Off

Charlie Shrem, CEO of BitInstant, today reported that his service transferred $1.1 million in USD and Bitcoins in the month of April, representing 120% growth over February and 340% growth over December. BitInstant is a popular service primarily used to rapidly move US dollars into and between the Bitcoin exchanges.

His report comes hot on the heels of widespread indicators of exponential growth throughout the Bitcoin economy. Loan services, stock exchanges, merchants, and Bitcoin gambling sites are all demonstrating significant growth for the first quarter of 2012.