Vitalik Buterin, the founder of Ethereum, replied to a September 3, 2018, report from Techcrunch that claims that the collapse of ETH is inevitable.
No Future for ‘Gas’
According to a report from TechCrunch, the collapse of ETH is inevitable, and we should expect that ETH — the asset, not the Ethereum Network itself — will soon go to zero.
The September 3 report, written by Jeremy Rubin, a technical advisor to Stellar and co-founder of the MIT Digital Currency Initiative, claims that Ethereum as a platform will end up succeeding, despite ETH becoming worthless.
The report aims to explain the mechanism of this downfall by citing Ethereum’s original value proposition.
According to the proposition, Ethereum is a decentralized platform that runs smart contracts: applications that run precisely as programmed without any possibility of downtime, censorship, fraud or third-party interference.
These apps run on a custom built blockchain, an enormously influential shared global infrastructure that can move value around and represent the ownership of property.
Rubin also points out that there is no value proposition for ETH in the official description, and that it’s most likely due to the fact that ETH’s value seems so apparent to the Ethereum Foundation that it is hardly worth mentioning: $ETH fees (dubbed ‘Gas’) is how you pay for all this.
However, Rubin points out that as all kinds of different ERC-20 tokens are built on the Ethereum network, paying for gas in ETH would create substantial risk, third-party dependency, and artificial downwards pressure on the price of the underlying token.
Instead, he proposes paying for gas in non-ETH assets, i.e., the underlying coins. This mechanism is called “economic abstraction.” Simply put, “economic abstraction” is the idea that a blockchain protocol would allow the use of any one of a potentially unbounded number of tokens, rather than a single coin.
Later in the report, Rubin concludes that if all the applications and their transactions can run on Ethereum without ETH, there’s no reason for ETH to be valuable. The only way ETH could retain its value, he said, as if “the miners enforce some sort of racket to require users to pay in ETH.”
He also points out that miners wouldn’t be the only ones looking to get pain in non-ETH assets – risk-averse users would want to minimize their exposure to volatile assets, and token developers would see pricing in their native asset reducing the sell-pressure.
Ethereum Cofounder Disagrees
Despite massive media coverage, Rubin’s report seems to have garnered more criticism than praise. Comments on TechCrunch’sreport point out the fact that economic abstraction relies on an intermediary to accept network token and pay the gas in ETH on behalf of the user. That means that ETH is always required to run a contract or a transaction.
Vitalik Buterin, the founder of Ethereum, replied to the report in a thread on Reddit and was seemingly unimpressed with Rubin’s views.
“I have every incentive to disagree with this, but I think there are quite a few very critical economic and technical details that the article is missing,” he said, adding that “we are likely not doing full “economic abstraction.”
“One could also use intermediate solutions, where third parties create “wrapper transactions” that take the fees for operations from users that are paid in spankchain tokens, and the third parties provide the ETH to the block proposer,” he explained.
Crypto Wallet Offers the Purchase Bitcoin and Ether for USD or EUR
A crypto wallet has enhanced its functionality, enabling users to buy cryptocurrency with a credit card using dollars or euros.
Lumi Wallet, which comes in the form of iOS and Android apps as well as a web wallet, says its motivation is to provide its users worldwide with safe and convenient tools for purchasing cryptocurrency. The company says it gives its clients the opportunity to buy Bitcoin (BTC) and Ether (ETH) in a fast, simple and secure way. The safety of fiat-to-crypto transactions is ensured by Simplex — technology that allows the processing online payments with “complete fraud protection and chargeback coverage.”
By expanding multicurrency features, Lumi seeks to become more appealing to consumers not only in the United States but also internationally. The team says this increases mass adoption and the promotion of cryptocurrencies. Lumi adds that it also gradually localizes all its products in order to make the wallet accessible for users no matter where they live and no matter which language they speak.
Users’ data protection
Lumi boasts its adoption of Simplex, which prevents users’ credit card data from fraud via a Know Your Customer protocol and sends all the money back if something abnormal is suspected. Being considered the new crypto industry standard, Simplex processes billions in dollars and Bitcoin every year, and it collaborates with the largest crypto platforms, as Lumi reports.
The team emphasizes that fiat-to-crypto exchange will take place directly in the wallet by means of a built-in browser so that users don’t have to leave the wallet in order to carry out a transaction. The company says that its ambition was not only to make the purchase of cryptocurrency convenient for its clients but also to provide a sufficiently high level of user security.
From its inception, the client-side Lumi Wallet has placed an emphasis on the protection of privacy. This has been done by ensuring the anonymity of transactions and providing users with complete control over their private keys, which are saved exclusively on their own devices.
Easier than ever
According to Lumi, buying cryptocurrency today is no harder than shopping online. This attracts both newcomers who have never bought it before as well as crypto enthusiasts. What’s more, Lumi strives to create a pleasant user experience by providing an “intuitive interface and smooth design in its applications.”
As for other features of Lumi Wallet, it allows clients to organize their digital asset portfolio as they wish by exposing, hiding and shifting token wallets. In addition, both the mobile app and the web version of Lumi are equipped with crypto price graphs and the entire histories of users’ transactions.
The company is looking forward to move to an open-source model this year. According to its founders, it will be a major step in Lumi’s development. The team hopes that this milestone will help to attract more loyal followers and supporters, as well as put more trust in Lumi Wallet.
Lumi notes that its intention is to make not only the original wallet open source, but also the web wallet and Lumi Collect. The latter is an Ethereum wallet for ERC-721 tokens such as Blockchain Cuties, Cryptokitties, CryptantCrabs and more. Through Lumi Collect, a user can store and manage all of the crypto collectibles and in-game assets in one place. For some games, it is also possible to perform in-game actions (like gifting, selling or breeding) without leaving the app.
In the future, the company is planning to expand its functionality by offering more convenient tools, such as physical and virtual credit cards that will allow for hassle-free purchases of Bitcoin and thereby stimulate mass crypto adoption.
Exchange Makes It Easier to Purchase Crypto Using Fiat for First Time
A crypto exchange says it is providing a much-needed bridge between fiat and digital currencies — offering an easy, accessible, intuitive platform to consumers, especially when purchasing crypto for the very first time.
BitMart says too many exchanges rely on crypto-to-crypto transactions or depend on stablecoin trading pairs. Although this may be perfectly practical for enthusiasts who already own coins and tokens, the company says this can alienate large swaths of the public — many of whom have been taking a wait-and-see approach to cryptocurrencies, including Bitcoin (BTC).
The exchange, which has offices around the world — including in New York, Seoul, Hong Kong and Nigeria — has the ambition of becoming the go-to channel for those who are looking for a way into the crypto world. To this end, the likes of Bitcoin and Ether (ETH) can be acquired through more than 300 payment methods.
BitMart has launched its fiat channel through a partnership with Evolve Bank & Trust. It supports same-day electronic payments via bank transfers, debit cards and credit cards with more than 2,500 banking institutions across the United States. The exchange currently offers zero fees for deposits and withdrawals, and once a fast verification process is completed, transactions can be initiated within a single click, enabling buying and selling to be done within seconds.
Customers get their own beneficiary accounts with the Evolve Bank and Trust for their assets, and transactional activities are only implemented with their express instructions. Email notifications and identity verification tools are also used to guarantee high levels of security.
A partnership with Simplex, an European Union-authorized financial institution, has enabled BitMart to accept fiat deposits via MasterCard and Visa cards. Meanwhile, a collaboration with Paxful enables crypto to be purchased using gift cards and PayPal. BitMart says it has chosen its third-party partners carefully to ensure that the process of purchasing crypto is easy, convenient and trustworthy — thereby removing barriers to entry.
Streamlined and reliable
Coins can be deposited directly into a user’s BitMart account, cutting down on the number of steps they need to take in order to keep their assets safe. From here, the consumer’s crypto options widen substantially, as they can trade their BTC or ETH for more than 110 cryptocurrencies offered through in excess of 235 trading pairs.
The company has the goal of being a “world-class digital asset trading platform.” To this end, a multi-layer and multi-cluster trading architecture is used to achieve stability and scalability, and eight major languages — English, simplified Chinese, traditional Chinese, Japanese, Vietnamese, Korean, Russian and Turkish — are supported. BitMart plans to offer additional languages in the not-too-distant future as it continues its quest to appeal to an international audience.
The exchange claims that it has amassed more than 850,000 registered users, with a daily trading volume of $768 million, since its launch back in March 2018.
Features in the pipeline
Along with making it easier for everyday consumers to purchase cryptocurrency with various payment methods, BitMart says it has been seeking to bridge the gap between traditional finance and cryptocurrency world by offering spot trading and over-the-counter trading. Upcoming features include decentralized trading and future contract trading — delivering a greater range of products to its expanding user base.
BitMart is currently available online, through specially created apps for Android and iOS devices, and via the H5 mobile browser. Maker and taker fees are calculated based on each user’s trading volume over the past 30 days, along with the number of BMX — the company’s native token — that they currently hold in their account.
BitMart currently ranks in the top-10 crypto exchanges on CoinMarketCap and has the goal of reaching the top 10,000 of Alexa’s global website ranking, opening USD trading pairs and gaining 1.5 million registered users by the fourth quarter of 2019.
U.S crypto-regulations have become more aggressive and lack clarity, claims ShapeShift’s Chief Legal Officer
While government organizations are yet to choose sides for drafting crypto-related regulations, crypto-exchanges (that predominantly serve as the front door to crypto-adoption) must keep up with changing requirements, or risk shifting to different geographies. On a similar note, Veronica McGregor, ShapeShift’s Chief Legal Officer, spoke about the ongoing regulatory chaos and how the Switzerland-based crypto-exchange tackles the same. McGregor said in an interview,
“It makes me sad when you think about how much money’s going into that (lawyers/legal fees) that could be going into innovating, developing, and creating value for people, and it’s just been diverted to compliance costs.”
McGregor also spoke of ShapeShift’s massive investments towards gaining regulatory clarity, with the company pioneering and delivering platforms that can provide “end-to-end holistic crypto experience.” McGregor went on to compare present-day regulations with those of 2014, stating,
“The regulatory environment has gotten a lot more clamped down on and a lot more aggressive in the last year and a half, and at the same time, that hasn’t brought any clarity.”
She also highlighted the government’s “conflicting messages” during the Libra hearings, claiming that the lack of clarity is driving technological innovations away from the U.S. McGregor added that the SEC-Kik fiasco will help crypto-businesses around the world to understand U.S. government’s stand on the ecosystem.
Taking cues from the company’s history in dealing with numerous cryptocurrencies, McGregor revealed that Bitcoin is still “king” for many in their line of business. The legal head of ShapeShift went on to warn naive users about ongoing scams, asking them to avoid unknown ads and enable phone-based 2-factor authentication.