Many times in the past few years I’ve had a frantic call from a family member or a friend whose computer has either slowed to a crawl or is acting strangely. The first thing that I do is have them go to www.malwarebytes.com and to install the free version of Malwarebytes and run a scan. I’d say about 9 times out of 10, the program finds tons of malware and other nasty stuff. The computer starts running much faster and my friend or family member things I’m a hero!
The next question I’m usually asked is how can they prevent this type of thing from happening again? I follow this with my own question – are you willing to spend a bit of money to fix this? If they’re willing to spend about $50 per computer for year then I point them to the full version of Malwarebyes:
Full disclosure – if you purchase by downloading from the above link, I will make a small commission on your purchase, at no cost to you.
Whether you purchase from here now or at elsewhere in the future, I highly recommend Malwarebytes. Think of it as having a permanent security guard always watching your computer to make sure that nasty malware is stopped in its tracks. That is essentially the difference between the paid and free version. The paid version is always running and you might not even know that it’s removing malware when you click on a link to a website.
I recommend downloading and installing the free version and doing a scan of your computer. You just may find that things run a lot more smoothly afterwards. Then you can decide if and when you are ready to purchase the full version for always-on protection.
From a bird’s eye view, cryptocurrency market commentary hubs like Twitter seem like squabble boxes of shilling, whirly-dirly technical analysis charts, and the occasional well-founded prediction.
Speculators are seemingly everywhere, and rapid account growth is rewarded to those able to correctly call some of cryptocurrency’s volatile movements.
Social sentiment analysis is a valuable tool to add to your understanding of cryptocurrency, however, it’s worth exploring the unique slice of history cryptocurrency has offered us in studying how people’s thoughts (and commentaries) affect market movements.
DOES SENTIMENT ANALYSIS YIELD DIVIDENDS?
One of the first things many savvy traders ended up doing is trying to build actionable correlations between social sentiment and certain digital assets.
For example, if an algorithm can predict that when tweets about keyword “TRON” hit a certain volume and display a generally positive sentiment, the price of TRON will increase, it would allow those traders to reap some serious profits.
There are even plenty of 3rd party Google Sheets plug-ins and add-ons that help users calculate their own correlation between social sentiment, social mentions, and the prices of particular digital assets.
So, can you use social sentiment analysis to make better trades? Humphrey B. Neill, the author of The Art of Contrary Thinking, spent much of his professional life studying group thinking. ”A ‘crowd’ thinks with its heart,” Neill writes. “While an individual thinks with his brain.”
However, it’s worth thinking of the subject from a different angle. The vast majority of professional traders, some of the biggest market movers, aren’t only aware of sentiment analysis and technical analysis, they’re capable of using them to lure retail investors into traps. There was a time where cryptocurrency markets were almost predictable for retail investors with a pulse on movements, but with the injection of large amounts of capital and more experienced traders, rogue price swings based on sentiments and rumors became much harder to predict.
A 2018 study by social listening platform Pulsar decided to find out whether people are actually talking about cryptocurrency, paving the foundation to explore whether predictive algorithms that study sentiment analysis could actually lead to consistent profits. Some of the key takeaways from the report include:
Bitcoin sits at the throne of conversation. With 52% of all conversation (the other 48% being spread around every other token), Bitcoin was the most talked about.
Despite rapid price growth, many people still don’t really understand what cryptocurrency is.
People have started to see cryptocurrency as more legitimate and less shady.
The study also found that, in the time period of September 2017 and January 2018, for every 10 percent of social media buzz registered, there was roughly a 5 percent rise in Bitcoin’s price within three days.
However, it’s worth noting that this study was during an intense bull run, and it was extremely difficult to lose money in most digital asset investments. This begs the question – does sentiment analysis function as well during a bear market?
Another study was conducted by Feng Mai at the Stevens School of Business that collected two years of data from Bitcointalk and two months of data from Twitter. The team put together a script that collected comment data and put it into sentiment categories. Then, it used a statistical method known as vector error correction, or VECM, to compare the price of Bitcoin with their findings. Mai noted that: “It’s not a one-way relationship, any changes in Bitcoin’s price are obviously going to affect the sentiment around it, so we needed to factor in those influences as well.”
The study affirmed that social media influence did affect Bitcoin’s price.
DOES SENTIMENT ANALYSIS HAVE A FUTURE?
Social sentiment and cryptocurrency markets have a weird love fling going on that has largely been out of the purview of regulatory authorities until the last year or so. In November 2018, the SEC clamped down on two mainstream figures, boxer Floyd Mayweather Jr. and music producer DJ Khaled for failing to disclose payments they received for promoting Initial Coin Offerings (ICOs).
Even then as cryptocurrency stands today, it’s not very easy to regulate or control price manipulation by influencers and social media commentary floods.
At the end of the day, what moves markets is capital. The birds will chirp all day long, but if they don’t have the money to put where their mouth is, there won’t really be a sizeable effect on price (unless people with capital do act on that sentiment).
Unless whales and the massive movers of markets are tweeting their moves, which they likely won’t, no amount of sentiment analysis will provide any substantial evidence for price predictions.
I had a call from my mom while she was a passenger in a car for a long trip. She brought her iPad with her, loaded with movies to watch. For some reason, the brightness kept dropping, even when she manually moved it back up. She couldn’t figure out why and when she called me, I couldn’t figure it out either.
I asked her to send me a screenshot so I could see what was going on. This is what she sent:
I searched some discussion forums and found some mentions of auto brightness but that didn’t fix it. Then someone mentioned a bluetooth keyboard whose keys were accidentally pressed. So I called her back and asked if her bluetooth keyboard was possibly in her bag and turned on. Yes! It was on and this keyboard has keys for controlling brightness. It seems that the ‘lower brightness’ button was being held down. As soon as she turned it off, all returned to normal.
I hope that someone finds this post when dealing with a similar annoying issue.
Unless you’ve been without Internet or news access for the past month, you’ve likely heard of Facebook’s Libra. Even if you have, worry not – we’ve got you covered.
Libra is a stablecoin by Facebook backed by a combination of bank deposits and short-term government securities. The project is slated to launch in 2020, but it has already received its fair share of criticisms from the press, regulators, and the general public.
HOW DOES LIBRA FUNCTION?
Libra is on a mission to be “A simple global currency and financial infrastructure that empowers billions of people.”
Few projects are actually as positioned to do this as Facebook, a platform with over 2.38 billion monthly active users. Facebook aims to connect the world via its Libra on a stable-value, global, digital currency.
THE LIBRA RESERVE:
All of Libra’s assets are stored in the Libra Reserve, which contains enough capital to fully back every Libra at all times.
Facebook plans to fill the Libra Reserve with funds from Founding Members, who will receive an Investment Token for their contributions. These Investment Token entitle the Founding members to a percentage of the interest payments the Reserve earns from its assets. However, if you want to be a Founding Member, it’s going to cost you a pretty penny; it costs $10 million to be a Founding Member and you also need substantial technological infrastructure
Facebook also plans to fill the Reserve through direct consumer Libra purchases. The only time more Libra enters circulation is when a user exchanges their fiat (USD) for Libra. When that user exchanges their Libra back to fiat, the Libra is destroyed by Facebook, decreasing the circulating supply and keeping the price stable.
Reserve assets are distributed among the custodians. Facebook plans to invest Reserve Funds into low-risk, low-interest bearing assets in order to fund its ecosystem development, engineering research, non-profits, and compensating Founding Members.
THE LIBRA BLOCKCHAIN:
The Libra Blockchain uses its own specific programming language called Move, similar to how Ethereum uses Solidity. Move enables developers to create and execute smart contracts right on the Libra Blockchain, utilizing Libra’s virtual machine called MoveVM to facilitate. Moving Libra from one user to another requires a small gas fee, similar to Ethereum.
The Libra Blockchain uses a Byzantine Fault Tolerance (BFT) approach called HotStuff. The Blockchain uses a group of validators to operate and maintain it. The network requires ⅔ of the validators to remain honest. Libra plans to eventually switch to a Proof-of-Stake (PoS) consensus algorithm, where users receive one vote for every coin they own and stake.
THE CALIBRA WALLET:
Facebook plans to launch its digital wallet Calibra alongside Libra. Calibra will exist within Facebook Messenger, Whatsapp, and as a standalone application. Recently, the head of the Calibra wallet David Marcus at a hearing with the Senate Banking Committee and touched base on a few critical components of the project’s goals.
It’s expected that Calibra will require Know-Your-Customer (KYC) and Anti-Money Laundering (AML) verification and financial tracking.
LIBRA TEAM & PROGRESS
Facebook has been able to attract some high-profile companies from the tech, financial, and cryptocurrency sectors.
The Libra Association is the decentralized entity working to bring the project to fruition. The Switzerland-based Association currently consists of Paypal, Mastercard, Visa, Facebook, Uber, Spotify, Coinbase, Lyft, and Andreessen Horowitz, among a few others as Founding Members.
The Association is responsible for making governance decisions for the ecosystem and mainting the blockchain network. When it comes to governance decisions, each critical decision is voted on by the Association Council Members. Each validator on the network receives on the representative spot on the Council. All major technical and policy rulings require a two-third majority, just like the BFT consensus. Each Association member is limited to either one percent of the total vote or one vote, whichever is larger.
The Association also contains a Social Impact Advisory Board (SIAB), a group that recommends social impact and grant investments.
Libra released its whitepaper on June 18, 2019, and simultaneously launched the network’s testnet, making the code open-source. Facebook currently plans the public launch of Libra for the first half of 2020, which will include all the APIs, libraries, and developer tools to build on the Libra Blockchain.
In the meantime, the Association is seeking to expand its membership base to include roughly 100 global organizations from a wide diversity of industries.
Facebook’s Libra has made some serious waves and it hasn’t even been released yet. Many are looking at the project as a leading frontrunner not only for stablecoins, but for a global decentralized currency.
However, the project is not without its antagonists. Facebook is already in hot water for data privacy issues, and adding in a global payments coin isn’t helping take some of the pressure off this company regulators and media have started to view as monopolistic and too-powerful. Many cryptocurrency aficionados are also split on Libra entering the cryptocurrency industry. The massive attention the behemoth social media platform brings to the digital asset conversation could be very important for maturing the industry, if not at least accelerating regulatory guidance. Libra, however, could also be poised to undermine Bitcoin.
Negatives aside, Libra could serve a powerful purpose in uniting millions (or billions) of unbanked peoples and people living in rapidly inflated economies with a modern economic system, paving the way for global financial freedom.
The “Coinbase Effect” is a theory within the cryptocurrency community that postulates that if a token/coin, usually one relatively less well-known, gets added to the Coinbase exchange, its price will increase substantially.
Coinbase is one of the largest cryptocurrency exchanges as well as arguably the most user-friendly, making it the starting point for new cryptocurrency traders. The idea is that when a coin gets added to the once-exclusive list of tokens offered on Coinbase, it’ll receive mainstream attention, higher trading volume, and liquidity.
The Coinbase Effect has come into question several times over the past year, mainly due to the underwhelming price gains of the nearly dozen assets added throughout the period – which, to be fair, was in the troughs of the crypto winter.
The Coinbase Effect reached popularity in 2017 with the flood of attention from thousands of new speculators and investors. 2017 was a time where a simple rumor of a digital asset being added to the exchange could give it a double-digit percentage price increase. At the time, Coinbase only had three digital assets – Bitcoin, Ethereum (added July 2016), and Litecoin (added May 2017).
When Coinbase started adding more digital assets, the prices of those assets didn’t experience astronomical price increases as the trader psychology of 2017 would have anticipated. Ripple, for example, was added in February 2019 and the price per XRP only increase about 5%, leaving the asset to hover at around $0.30.
Today, Coinbase has 15 digital assets, with one of them being a stablecoin. Many analysts assumed the exchanges Midus Touch was extinguished, but then a relatively obscure digital asset LINK (ChainLink) was added in June 2019. Upon its addition, the price per LINK skyrocketed from $2.26 to $4.15 over the next day – a sharp gain of 83.6%.
Admittedly, there are some reservations to make in regards to the Coinbase Effect. The first is that the trader psychology is very much rooted in the speculative “buy the rumor and sell the news” mindset. The second is that Coinbase does actually provide some tangible benefits in the form of attention, liquidity, and volume, so it’s not completely speculative mumbo jumbo. The third is that the price increasing effect is largely a by-product of Coinbase simply running their exchange as they see fit, and pumping an asset’s price isn’t a primary intention (which could also technically be construed as illegal.)
WHAT TO MAKE OF THE COINBASE EFFECT
Of course, we urge our readers to do their own due diligence if they are considering investing in anything, and this information is purely educational and for entertainment purposes. However, it’s worth putting the Coinbase Effect on your radar as there are a few contradicting ideas to its effectiveness.
The first is what we’ve covered – the price jumps stimulated by rumor mills and the ensuing hordes of speculative investors. The sudden surge of demand creates a snowball effect where more people try to get on the rocket ship, which is either headed to the true enterprise value of the asset (in a perfectly sensical world, which cryptocurrency is not), or to a peak where speculators will immediately try to cash out and cause the price to plummet.
The second is a bit of a savvier investment perspective. Some projects added to Coinbase might actually be worth much more than what they were prior to the addition, and all they needed was attention, users, liquidity, and volume. This is especially true for utility tokens, which serve to power a marketplace, network, etc., but often have trouble finding trading volume, making them less appealing to holders.
FINAL THOUGHTS – IS THE COINBASE EFFECT REAL?
The Coinbase Effect is more real than Sasquatch and the Loch Ness Monster, but it definitely isn’t the Holy Grail of a fundamentally intelligent trading strategy.
As evidenced by the data points of assets added in 2018 and 2019, the trend generally shows that being added to Coinbase can have a positive effect on an asset’s price. Absent of the recent LINK outlier, one would assume being added to Coinbase has a diminishing return as more assets get added. However, for relatively unknown assets, being on Coinbase can help launch them to exponential growth. It
Ultimately, time will tell how powerful the Coinbase Effect is. It is interesting to see a single corporate entity have such influence on a wide variety of projects. Then again, cryptocurrency as an entirely new asset class will likely be more than just a small footnote in history books – with the Coinbase Effect being one of the more interesting phenomena.
So, you’ve entered the exciting world of digital currency but you’re worried that you may be at risk of having your coins stolen by hackers. This concern is completely valid, and even some of the biggest players in the space have gotten hacked.
There are billions of dollars worth in cryptocurrency that have fallen into the hands of malicious third parties and hacks don’t seem to be slowing down. Coincheck, a Japanese exchange, lost $534 million in NEM coins (523 million NEM) in 2019 – one of the biggest hacks in cryptocurrency history.
As an individual, you might not be such a focal target as centralized exchanges such as Coinbase, but the possibility that someone wants to gain access to your coins is still very real. Here’s how to get and stay protected and keep doing online gambling with bitcoin safely.
WHAT’S COOLER THAN BEING COOL? COLD STORAGE
By far, the safest way to keep your coins safe is by keeping it in cold storage, a term that refers to cryptocurrency (or data) kept off the Internet. This can be done in a variety of ways included by paper wallets (literal pieces of paper) or hardware wallets such as a Ledger Nano S or Trezor.
When it comes down to it, you’re probably better off using a hardware wallet because paper wallets can be very easy to lose and often require using an online generator, which sort of defeats the purpose of having an offline hardware wallet.
However, keep in mind that cold storage only protects you from external threats – not the seemingly infinite capacity for human error. There are dozens of stories of unfortunate souls accidentally tossing their cold storage devices in the trash, or in a moving box that ended up getting mixed up and being sent to a Goodwill as a donation.
CALL IN THE BACK UP FOR YOUR BACK UP
The coast isn’t clear even once you’ve got your cold storage set up, but you’re almost there! Hardware wallets usually come with a series of back up words that will help you regain access to your cryptocurrency wallet in the event that you lose the physical hardware wallet.
But, wait – what’s the point of a hardware wallet if someone can just gain access to your cryptocurrency holdings by using your back up phrases?
Exactly – so you need to make sure those are safe as well. The point isn’t to prevent someone from gaining physical access to your cryptocurrency, which requires the same precautions as having a briefcase full of cash or high-end piece of artwork.
Many people decide to rent one or two safety deposit box at a reputable bank(s), which usually costs around $60 per year, and keep their hardware device and back up phrases there for safe keeping. However, this has some burning drawbacks
The first is that you lose the convenience of having your cryptocurrency on you and available for trading at any moment. This is why this strategy tends to be only used by people looking to sit on their holdings, you know – the HODLers, and not by people doing short-term trades or using their cryptocurrency for things such as online gambling with bitcoin on MintDice.
The second is more ideological. Many cryptocurrency enthusiasts are vehement supporters of “being your own bank.” Keeping your hardware wallets in a bank seems diametrically opposed to this, but at the end of the day, would you rather be a hacked or not hacked?
BUT, WHAT IF I DON’T WANT TO KEEP ALL MY CRYPTO LOCKED AWAY?
While cold storage is the safest way to protect your digital assets, it can be inconvenient for people who need access to their holdings on a regular basis.
If you’re in this situation, it’s recommended you keep whatever cryptocurrency you need on hand on a software wallet such as Exodus, and the rest in a cold wallet.
Of course, you also have the option to keep your cryptocurrency on an exchange such as Binance or Coinbase, but then you immediately up the ante of risk. You not only have to worry about hackers getting into your personal wallet, but also those hacking into the exchange itself, or even the exchange deciding to run off with your mula.
Modern exchanges have taken precautions to safeguard their customers, but this is an article on the best ways to store your crypto, so we need to mention the risks associated with exchanges.
If you do decide to store some cryptocurrency on an exchange or other “hot wallet”, there are some precautions you should take:
Enable 2FA – This is a MUST. Two-factor or other multi-factor, authentication sets up more safeguards to your private keys. Most people set this up with their phone number, and many exchanges have made 2FA part of their standard procedure. However, there have also been instances where hackers have gained access to someone’s SIM card remotely.
Google Authenticator – This is a free software-based authenticator that generates new codes every few seconds, making it harder for hackers to use any single code for any period of time.
FreeOTP – This is a free and open-source software token that can be used for two-factor authentication.
Keepassxc – a free and open-source password manager.
“Only you can prevent forest fires.” – Smokey the Bear.
Also, only you can prevent your cryptocurrency from getting jacked. Learn the ropes of keeping your tokens safe, and you will be able to live the crypto-libertarian dream of being your own bank – or at least not losing a bunch of tokens that potentially will be (or currently are) worth a fortune. Done correctly, you’ll be protected and gambling online with bitcoin safely.
One of the golden rules of investing is to understand the company, industry, and reason that you are investing. Educated investments are the ones where the investor thoroughly understands how they will make money from the investment.
However, that can be difficult when you’re dealing with new technologies like blockchain and cryptocurrency. Many people see the significant potential gains and want to invest their money before understanding what they’re getting into. But it’s important to understand the company you’re buying coins and tokens from instead of blindly investing because someone on Twitter is pushing a particular cryptocurrency in the market.
The good news is there are resources available to help you understand the blockchain technology companies you’re investing with and perform the critical due diligence necessary before buying into a cryptocurrency. There is usually chatter about particular cryptos in forums and on social media platforms, but often the best place to start is simply the company’s website.
That’s where you’ll typically find the company’s white paper, which should be one of the primary factors behind your decision to invest in a cryptocurrency. white papers are a key resource to learn about a blockchain company, and we’re going to give you some critical points to look for when you’re reading a company’s white paper.
WHAT IS A CRYPTO WHITE PAPER?
Let’s take a quick moment to define a white paper. Traditional companies that trade publicly want to attract investors, so they have business plans and resources to explain their business model, growth strategies, and future milestones.
The same is true for blockchain companies. The new crowdfund investing style has changed the landscape slightly, but cryptocurrencies usually provide all of their business-related information in a white paper.
Strong white papers primarily act as business plans that outline the blockchain company’s business model, the problem they’re solving, how they’re addressing it, the team behind the project, and any other information to build credibility behind their project.
WHAT TO LOOK FOR IN A WHITE PAPER BEFORE INVESTING?
white papers can make or break it when it comes to a cryptocurrency investment. A blockchain company that has a professionally developed website and an easily understandable white paper has a great chance to attract more investors than a company that looks like it quickly threw together a few presentation slides.
With over 1,500 different cryptocurrencies in the markets now, it’s essential to become familiar with white papers and the process of using them as a resource for your investing decisions. It’s especially true when it comes to ICOsand new blockchain companies that haven’t been trading on the public crypto exchanges.
However, we know that some white papers can be long, complex and daunting. To keep you from getting overwhelmed, here are a few key things to watch for when you’re looking through a cryptocurrency white paper:
Take note of the legal structure of the project. Have they formed a company yet? Which country is it registered in? As a U.S. citizen, you might not be able to invest in offshore ICOs. Check to see if they share their address and if they’re operating from an office or other space. Having a defined legal structure helps add credibility to the company, rather than investing in an unknown entity and group.
You want to have information about the development team available, so you know what skills and experience are backing the company. Some blockchain companies stay anonymous or hide their team; you want to keep your distance from those companies. That’s a perfect recipe for a scam cryptocurrency.
Other times the company will try to inflate their team members. You want to check on the experience of the key members of the team and evaluate if they are capable of achieving the company’s goals.
Good blockchain companies will have strong development teams listed in their white paper and displayed on their website.
Blockchain technology has the potential to solve a multitude of problems and inefficiencies in business and the world. white papers are the perfect place for blockchain companies to explain how their business and product address specific issues.
When reading a white paper, you want to be on the lookout for the key problems identified, and understand how this company is using blockchain to solve it. If you can’t get your mind around the use case and it seems impractical, then the company is probably not the right investment.
Product: white papers will often share details about the product or prototype. Depending on the company’s stage in the process, they might be actively building the prototype, or they might have a functioning product with live users.
It’s an important part of the white paper for potential investors to understand. Blockchain companies that don’t have a working product are a much riskier bet than companies with an active blockchain and user base.
Good white papers also frequently share technical details behind the product and blockchain. Often they will publicly share their code on a platform called GitHub. While it may not be in your skill set to read through and understand the technical language, that’s where ancillary resources are incredibly helpful.
There are forums like Reddit and BitcoinTalk where the cryptocurrency communities are more than willing to share their thoughts and opinions on different cryptos. A lot of crypto enthusiasts are tech-savvy, and share their thoughts on the technical details of a blockchain company’s white paper. So if you don’t quite understand the technical sections of the white paper, read through some threads on the company and see if anyone else breaks down the information in plain English.
The other thing you want to look for in cryptocurrency white papers is a clear roadmap for the company. It should probably include a history to date of the company’s progress and key milestones. Again, keep your distance from cryptocurrencies that have short histories that only include ICO preparation.
Then there should also be key benchmarks and milestones for the future. It’s where you want to evaluate and determine if the roadmap dates are practical, and if the development team is capable of delivering on the proposed time frame. Many blockchain companies map out optimistic roadmaps, so it’s important to temper expectations and stay updated on companies you’re considering through social media channels like Telegram.
Cryptocurrency investments are just like any other investment you make. The key is understanding how the investment vehicle (company, stock, bond, real estate, crypto) is going to deliver returns on your money.
When it comes to cryptocurrencies, this can be a new feat for many people just entering the crypto markets. Many of those people are eager to get their money in and start investing in cryptocurrency. We’ve noted before that patience is important, and there are some fundamentals to get under your belt before diving into the deep end, like understanding crypto wallets and exchanges.
Now we can add understanding white papers to the list. Just as you would want to read, understand, and believe in a company’s business plan before investing in shares, you want to have a firm grasp on the blockchain company before investing in its cryptocurrency. In a marketplace where there’s a new scam popping up right and left, it’s a buyer beware market. white papers are a good compass for investors to navigate the murky waters and make smart investments in cryptocurrency.
Fifteen years ago when Mark Zuckerberg and Eduardo Saverin created what would become Facebook, it would have been difficult to picture just how powerful that project would eventually become.
When Facebook opened its doors to the public in 2006 and began its journey in the shadows of social networks like Hi5 and MySpace, there wasn’t the slightest hint that it would exist in today’s era of digital currencies, much less create its own. But development has brought Facebook a long way, and with it, millions of users.
Facebook was originally intended as a social networking site in which users could create extensive friend lists and share activities with members of those lists. It served a different purpose for every demographic. For adults, it was a way to find old friends again after many years. For teenagers, there was no better way to throw a party and invite everyone at the same time.
As more people used the network, Facebook’s functionality increased. For brands, Facebook became a new way to reach their target audiences and as the demand for more intentional marketing tools increased, Facebook silently evolved.
Today, Facebook is a machine for the creation, storage and distribution of data through various channels, including Whatsapp, and can be used for any of the following:
Uploading photos and maintaining picture galleries with time stamps.
Networking and interacting online using Facebook’s instant messenger.
Joining groups and interacting with fan pages at any point in time.
Marketing a business by distributing content to a wide audience
Streaming and creating videos easily on Facebook live.
Just like Chinese social media app WeChat, Facebook has joined the race to become the ultimate platform with every type of activity a user could need including tools for work, advertising, social activities, and payments.
While it has everything else on lockdown, the social media giant has had some difficulties perfecting its payment areas. In an effort to solve these difficulties, it plans to introduce FaceCoin, its own digital stable coin to facilitate payments using blockchain technology for its WhatsApp users.
FaceCoin is a new cryptocurrency proposed by Facebook that will allow users of Whatsapp to send money around the world. It is expected to be cheaper and faster than regular payment methods while allowing users to keep their money within the social media network.
According to a report by Bloomberg, other messaging companies like Telegram are also minting their own cryptocurrencies for the same purpose. Their extensive user bases present a unique opportunity to tackle remittance, especially in developing countries. For example, in Saudi Arabia, Malaysia, and Brazil, 73%, 68%, and 56% of the total population are active WhatsApp users. It would be easier to send money to such countries using an integrated Whatsapp payment structure than to use a separate app like Paypal.
Bitcoin has shown that it is possible to simplify the process of sending money across borders even with their restrictions. Unfortunately, there are still many problems that Bitcoin and other cryptocurrencies face, such as regulatory uncertainty.
One major regulatory hurdle faced by Bitcoin is the lack of a central authority to blame if anything happens to user funds. This situation makes it easier for criminals to take advantage of the network and creates a lack of trust on the part of users. The design of the network also makes it difficult to scale up for mainstream adoption.
FaceCoin is expected to be different from Bitcoin in its structure and design but it remains unclear how these differences will solve its problems. Will they have a more centralized structure that users can trust? Or a perhaps a more scalable design?
For now, it seems that if FaceCoin and other new digital currencies don’t take a deliberate stand against these issues in the planning and design phase, they’ll get stuck.
A HISTORY OF PAYMENTS
Although FaceCoin is the first fully-fledged cryptocurrency supposedly coming out of Facebook, this is not the company’s first dabble into payments technology. In 2011, Facebook launched Facebook Credits, a virtual currency system intended to simplify payments. Issues with fluctuating exchange rates for international payments prevented this system from gaining widespread use.
The company also launched Facebook Gifts in 2012 as a way for its users to send digital gifts internationally, but couldn’t solve localization issues to make it work either. For a while, Facebook has been expected to make another move in the virtual currency space, especially since recruiting former PayPal president David Marcus in 2014. In light of recent developments, Marcus is heading the company’s blockchain initiatives, which are still strictly on a need-to-know basis. According to Linkedin, Facebook’s blockchain team now has up to 40 people.
As digital currencies grow more popular, the pressure to solve the problems with cross-border payments is also increasing. Digital currencies like Bitcoin and Ripple are credited as faster payment methods compared to traditional banking and they also have reduced fees, so what on earth is the big problem?
Simple. The intended market (developing countries) still has a currency conversion problem after receiving money in the form of digital currency. For example, a person could send 500 Bitcoin, Ripple or even FaceCoin to someone else in Kenya. But now, the recipients must go through the time-consuming task of looking for local exchanges on which to convert it back to Kenyan shillings.
This is even more difficult because developing countries have nowhere near the number of exchanges or level of cryptocurrency infrastructural development as their counterparts. An alternative would be to use foreign exchanges and pay charges, but going through the stress of opening Coinbase accounts just to convert some money makes the whole purpose of using digital currencies redundant.
FaceCoin can attempt to solve these issues in different ways. They can create a better way for users to exchange their virtual currency for their national currencies without the need for Coinbase accounts. They can also aim to create a large marketplace where users can pay bills, buy goods and services, as well as invest without leaving the Facebook ecosystem (including WhatsApp).
This will reduce the need for conversion and save users the stress. As it stands, the Facebook site has a great foundation to make something like this work. Integrating bill payment, ridesharing, and other platforms with the Facebook platform should not be too difficult to achieve. There’s just one hitch: Not everyone wants to use a currency simply because Facebook made it. Also, a system like this is out of the realms of remittances and is simply equivalent to a game system in which people can send game tokens to each other.
Like other companies, Facebook is showing that it understands the importance of remittances. Being in a great position to take advantage of it is one thing, but knowing the best way to approach it is another. FaceCoin could be the missing link between digital currencies and fully functional remittance systems.
Facebook is only one of several large companies making a move with blockchain technology. Lately, corporations like Amazon, Walmart, and even IBM have graced the headlines with one innovation or the other. By increasing financial accessibility and scaling one of the greatest hurdles that Bitcoin has faced, Facebook could make life easier for millions of people.
There is so much talk about Bitcoin mining all the time, from Bitmain’s huge expansion plans to news concerning Nvidia’s ASIC devices. A common understanding is that the Bitcoin network is secured by collective groups of people known as miners. But outside of that, there are many technicalities to the entire mining process.
Bitcoin mining is a lucrative venture that involves a series of actions and techniques including confirming the transactions of everyday users. In return, miners receive “block rewards” for their services. The process is capital intensive and consumes resources like processing power and electricity. This makes mining highly competitive, leading to the purchase of powerful and continuously-evolving hardware like ASIC devices which have replaced the average GPU and mining software.
WHAT DOES BITCOIN MINING SOFTWARE DO?
While Bitcoin mining hardware is a common topic within the space, software often gets overlooked. Hardware merely provides the necessary processing power for mining while nearly everything else is handled by Bitcoin mining software. It performs important functions like:
Providing miners with a solid interface to carry out their work.
Running the mining algorithms that aid miners in solving the complex puzzles assigned by the Bitcoin blockchain.
Delivering work done by the mining hardware to the Bitcoin network.
Receiving completed work from other miners on the network.
Connecting the work done by solo miners to the blockchain.
Connecting members of mining pools to the rest of their pool.
Monitoring and displaying miner input and output as well as statistics of variables such as base rate, temperature, fan speed, and miner speed.
WHAT ARE THE TOP BITCOIN MINING SOFTWARE?
There are several Bitcoin mining software on the market and each one varies in functionality and efficiency. Some really stand out and here are the top 6 among them:
Known as one of the most popular BTC mining software, CGMiner works as a multi-pool FPGA, GPU, and ASIC miner. It provides extensive ATI GPU monitoring, fan speed support and clocking support for Bitcoin and other altcoins. As one of several miners written in C# programming language, it is optimized for speed, efficiency, and compatibility with Windows, Linux and Mac operating systems.
CGMiner has a host of interesting features including:
Monitoring and overclocking capabilities.
Accommodation of different proxy mining methods
Support for both solo and pool mining
A scalable hash rate networking scheduler
Support for submission cache
This software is regarded as one of the most advanced because of its interaction with Bitcoin mining hardware. It allows users to configure ASIC and FPGA settings straight from its interface in a command-specific manner.
Regarded as the best mining software for beginners, MultiMiner simplifies the process of mining a lot better than other software. Since the idea of mining Bitcoin can seem a little daunting at the beginning, new miners are better off starting with software that is easier to operate and understand.
Some attractive features of MultiMiner include:
Desktop application format.
Compatibility with Windows, Mac OS X, and Linux.
Multi-device switch between ASICs and FPGAs.
Multi-device compatibility with BFL/Bitforce, Block Erupter, and HashBuster Micro.
Multicurrency switch between various cryptocurrencies like Litecoin and Bitcoin Cash.
Automatic hardware detection.
Remote monitoring and control of other MultiMiner rigs.
Ability to scan and detect mining hardware details such as average hashing power and corresponding pool.
Automatic mining difficulty and profitability selection.
Projected profits display and other analytics.
BFGMiner is very similar to CGMiner in its functionality and mode of operation, except that it is more ASIC-focused. Like CGMiner, BFGMiner is also written in C# and optimized for mining speed and efficiency. It supports OpenWrt-compatible routers on ASIC, GPU, CPU, and FPGAs as well.
Some of its interesting features include:
Windows, Linux, and Mac operating system compatibility.
Support for ADL device reordering via the PCI bus ID, fan control and integrated overclocking as well as, mining with free mesa/LLVM OpenCL.
Multi-currency mining support involving simultaneously mining other cryptocurrencies alongside Bitcoin.
Use of pool strategies like load-balance and balance.
Enabled multi-pooling and tracking pools on the same network.
Independent pool tracking on different networks.
Support for the simultaneous use of several algorithms like SHA-256 used by Bitcoin and Scrypt used by Litecoin, on CPU, OpenCL, and Proxy drivers.
Algorithm assignment based on custom mining goals.
Mining algorithm control sharing.
BitMinter’s strongest point lies in cross-platform enabled mining, with its own mining pool, commonly known as one of the oldest in existence. Each new user is required to join the pool to make it easier for them to mine and earn more. Since 2011, the pool has registered over 400,000 user accounts.
Unlike CGMiner and BFGMiner, BitMinter is based on the Java Network Launch Protocol (JNLP) and does not require an installation to function. It is a cloud-based service which focuses on people who are interested in mining but can’t afford expensive ASICs.
Some of its major features include:
Windows, Mac OS X, and Linux compatibility.
ASIC, GPU and FPGA compatibility.
A Graphical User Interface (GUI) optimized for ease-of-use and understanding.
Easy ASIC hardware configuration.
Profitable payment options including 99 percent of mining income allocated to users.
Support on BitMinter, Block Erupter USB, Chili, Red/Blue Fury, and Antminer U1/U2.
This is an open-source software upgrade for software like CGMiner and BFGMiner, which focuses on the graphical user interface (GUI). Its main function is the provision of an organized user interface that can be integrated directly with a miner’s cryptocurrency wallet.
EasyMiner gives its users the option of choosing a “moneymaker mode” which is attached to a particular Litecoin mining pool. It also offers a ‘solo mode’, in which miners are allowed to choose which pools they want to join, which cryptocurrencies they want to mine as well as a custom hash algorithm that corresponds with that cryptocurrency.
Its features include:
Multi-currency support including Bitcoin, Litecoin, and other altcoins.
Windows operating system compatibility
ASIC Mining hardware compatibility
Support for both solo and pool mining.
6. AWESOME MINER
When it comes to solving the problems associated with centralized mining management, Awesome Miner is a user’s best bet. Unlike other mining software, it can work really well with multiple mining rigs. Although Awesome Miner is built for mainly the Windows operating system, it has an accessible web-based interface.
The features of this miner include:
Support for over 25 mining engines including CGMiner, BFGMiner, Xmrig, SBMiner, and SGMiner.
SHA-256, Ethereum, X11, Scrypt and Zcash compatibility.
Single operation pool management.
Status and temperature monitoring on ASIC and FPGA devices from a single location.
Inbuilt C# script engine.
API access setup.
Default pool configuration for all Bitmain Antminer ASICs.
Mining is what keeps the Bitcoin network secure and functional. Without it, the network will crumble, bringing the cryptocurrency ecosystem to a critical point. For something as competitive as Bitcoin mining, a miner’s software choice can mean the difference between stagnation and huge rewards.
This is why miners, especially beginners must think thoroughly about what features they expect and require in a software. While the software discussed above are incredibly popular, there are others within the space, so proper research must be carried out. As development continues, Bitcoin mining software may continue to evolve, to better meet the growing needs of miners.
As far as emerging technologies go, blockchain technology has arguably generated more buzz than any of the others. In its short time underpinning several cryptocurrencies and decentralized applications, this database platform has garnered the attention of various industry leaders, policymakers and large organizations willing to invest in its development. As an example, IBM already has more than 100 pending blockchain patents, and corporations like MasterCard and Visa are in similar boats. But what exactly is a blockchain and what’s so special about this technology?
A blockchain is a type of peer-to-peer data structure for storing transactional data in containers known as blocks. As the name suggests, these blocks are linked in a chain and secured using cryptography. They mostly function as a supporting technology for systems in which a token is exchanged between several parties, or data concerning a particular object is entered and stored.
HOW DOES BLOCKCHAIN TECHNOLOGY WORK?
This technology is considered incredibly useful in different industries due to benefits like security, transparency, immutability, privacy, and the elimination of the need for third parties and a central authority in any process.
Blockchains are secured through consensus mechanisms which ensure that every transaction entering the blockchain is valid. Depending on the architecture, the presence of consensus may vary. In public blockchains, consensus is achieved through any of the currently available mechanisms such as Proof-of-Work (PoW), Proof-of-Stake (PoS), Delegated Proof of Stake (DPoS), or any of their many variations. Private blockchains mostly do not require consensus since a single entity owns and presides over them. Consortium or federation blockchains only require consensus from member organizations.
Either way, the basic principle behind consensus is simple. Let’s assume that 5 people are in a room and two of them (Person A and Person B) exchange $5. For that data to be considered valid and on the record, the other people in the room must agree that the transaction really occurred. However, on peer-based blockchains where there are thousands of active users, a word-of-mouth confirmation by every single user is impossible. This is why special mechanisms which account for the scale of blockchains are used to achieve consensus.
The immutable quality of blockchain lies in the properties of every block. Each one is marked with the hash number (a unique cryptographic identification) and a time stamp. Changing any data in the block will change the hash number and disrupt the other blocks. This is why blockchain is considered tamper-proof as a database. As for transparency, anyone can audit transactions on a public blockchain like that of Bitcoin by using a block explorer. This makes it easy to carry out many different blockchain applications without the fear of transactions being manipulated within a closed system.
CURRENT APPLICATIONS OF BLOCKCHAIN TECHNOLOGY
Initially, the only application of blockchain technology was to power systems like Bitcoin, Ripple, and Stellar, which allow people to send their assets from one place to another in the form of digital currency. But in its ten years of existence, a lot has changed as far as blockchain applications go.
The introduction and implementation of smart contracts, first mentioned by Nick Szabo in 1997 on the Ethereumblockchain, paved the way for other applications of the technology. Smart contracts are automated self-executing contracts which function without the interference of any external party once initiated. They are programmed with a set of conditions and execute when those conditions are met.
As a result of the existence of smart contracts and their combination with blockchain, the technology has fascinating use cases in other industries. One example is in real estate, where several individuals or corporate entities can share ownership of assets. This means that they can allow people to buy a share in a property and earn profits as market prices rise. These assets can also be transferred to other parties and all such transactions are facilitated by smart contracts while cryptocurrency tokens are used as the equivalent of stock.
You can apply the same principle to art and almost any other financial or high-value asset. In entertainment, the presence of middlemen in the distribution chain reduces the amount of money paid to content creators. Blockchain platforms like TRON, BitSong, and VOISE ensure that money goes straight to the content creators without the intermediaries. In the food and shipping industries, it is used for supply chain management and to gather data on the origin of food or shipments. This provides accountability within both industries in the case of food contamination or missing goods.
In the future, blockchain may be used to prevent identity theft, facilitate voting, or even enhance online gamblingsystems. It could also be combined with other emerging technologies like 5G for various Internet of Things (IoT) applications.
WHAT IS 5G TECHNOLOGY?
1G, 2G, 3G, and even 4G are familiar terms for anyone with a mobile device. These terms are used to show different generations of wireless technology. 1G was known as analog cellular technology, the first of its kind. 2G was the first digital cellular network and came in the form of GSM, CDMA, and TDMA. 3G improved upon existing speeds while operating at 200kbps to several megabits per second in the form of HSPA, EVDO, and UMTS. 4G was released with even greater speeds of up to hundreds of megabits and Gigabits in the form of LTE and WiMAX.
For those with mobile devices, the arrival of 4G technology was epic. The speeds it advertised had never been seen, and soon it became commonplace. Today, there’s a new kid on the block.
5G technology is an improvement on existing mobile wireless networks, which promises faster speeds, lower latency, and better connectivity than its previous counterparts. The high speeds will allow the network to move more data while the low latency will improve the responsiveness of the network.
Although wireless network generations are usually not backward compatible, early versions of 5G networks will be compatible with 4G. Soon after, when there are more 5G devices and applications, a non-backward compatible version will likely be released.
HOW DOES 5G WORK?
Most generations of wireless technology have distinct differences in properties like speed, capacity, and breaks in their encoding, known as air interfaces.
Similar to previous generations of cellular networks, 5G uses a network of cell sites consisting of towers which send encoded data through radio waves. Every site is connected to a single point which acts as a support for the network of cell sites, through wired or wireless connections.
Like 4G LTE network, 5G uses OFDM encoding for data. However, in the latter, the architecture promotes a higher level of flexibility and lower latency, which leads to higher speeds. They also have more cells and require larger airwaves than previous generation networks, to carry the amount of capacity and smart applications they are designed for.
5G will operate on channels of about 100MHz and up to 800MHz when bonded up. This is far larger than 4G network channels which fall between the range of 20MHz and 160MHz bonded up.
WHERE IS 5G AVAILABLE?
The 5G network is already available in several places across the US as telcos race to implement it.
According to AT&T, its network is now available in 19 US cities where it is currently running tests. The cities are Atlanta, Charlotte, Dallas, Houston, Indianapolis, San Francisco, Jacksonville, Louisville, Oklahoma City, New Orleans, San Antonio, Waco, Las Vegas, Los Angeles, Nashville, Orlando, Raleigh, San Diego, San Francisco, and San Jose.
Sprint has also announced that it is improving upon its 2.5GHz network for 5G use and preparing all of its cell sites for 5G. T-Mobile hopes to implement 5G this year, via its 600MHz and 28GHz network bands. A roll out across the country may happen in 2020. According to Verizon, it has implemented “millimeter wave 5G” for use in its existing home 5G broadband and will have also have a mobile network version available this year.
Several 5G phones have also been released, such as Samsung Galaxy S10 5G, ZTE Axon 10 Pro 5G, Samsung Galaxy Fold, LG V50 ThinQ, OnePlus 5G Phone, Huawei Mate X, and Xiaomi Mi Mix 3 5G. This means that people will have to get new devices to try out the network when its applications become more popular. Qualcomm already has chips designed for compatibility with 5G.
Europe isn’t left out as OnePlus gears up to release the continent’s first 5G-compatible phone in spring. Huawei is making plans to do the same for Asia. Despite current releases, rollouts for the public will likely happen in 2020.
According to Canada’s Telus Mobility, 5G will be available to its customers in 2020 but will likely roll out in Vancouver earlier than other cities. Rogers Communications is investing $4.7 billion USD in 5G technology development in 2019 and will create a test site on the University of British Columbia campus during the same year.
Puerto Rican Wireless provider Claro will possibly release its 5G network between April and June 2019.
LG Uplus’ has already gone live with its 5G network in Seoul and its surroundings. Currently, the company has positioned more than 4000 5G stations in Incheon, Seoul, and Gyeonggi, and planned to deploy more than 7,000 by the end of 2018. Their plan to release 5G infrastructure to the general populace in major cities by 2020.
Heo Won-Seok, the ICT and Broadcasting Technology Policy director at the Ministry of Science and ICT, has stated that 5% of South Korea’s mobile users will be using the 5G network by 2020, and up to 90% by 2026.
Japan’s largest wireless network provider, NTT DOCOMO is experimenting with 5G and has been doing so since 2010. The company plans to launch and plan to launch “pre-commercial 5G network services” by September 2019 and commercial services in 2020.
Zain and Ooredoo, two of the largest telecommunication companies in Kuwait have released their 5G services. Zain announced its launch in June 2018 and a few hours after the announcement, Ooredoo made a similar reveal.
5G will soon be available in the United Arab Emirates through Etisalat UAE and Du. The former made a deal with Huawei in February 2019 to offer “5G wireless, 5G service oriented core and a 5G-ready transport network to facilitate smooth 5G technology adoption.”
Like many other countries, Vietnam is aiming for a 5G release in 2020. According to Viettel, the country’s largest state-owned telecommunications company, they will carry out 5G tests throughout 2019 and will likely introduce the network the following year.
Vodacom Group launched its 5G network in Lesotho, South Africa, in August 2018. The company was also the first to provide 2G, 3G, and 4G, networks in the country. The company is using a fixed wireless access (FWA) network in the 3.5 GHz band.
THE SIGNIFICANCE OF 5G TECHNOLOGY
The high speeds provided by 5G network will allow for more than just uploads and downloads like other wireless networks are used for. Everything from enhancing artificial intelligence, culling big data, enhancing internet of things devices which connect to other devices to carry out tasks, connected networks of towns and cities could become reality. Today, these things are not happening because internet speeds and capacity are not high enough and don’t have a low-enough latency.
4G cannot handle the interconnection of IoT devices because their design makes it expensive, and consume a lot of power. To really support large scale connectivity between devices, the network must at least be inexpensive and 5G may be the solution. The 5G network is not only inexpensive, but it also allows connectivity on far more devices than 4G, especially for low-powered devices and sensors.
FUTURE IMPLICATIONS OF 5G
The potential future applications of 5G technology are limitless. By design, it can be combined with many different technologies that are currently progressing at a slow pace due to the lack of supportive infrastructure. It can also enhance other more established technologies. Some examples are virtual reality, driverless cars, and mobile internet.
5G may give virtual and augmented reality a boost by providing the type of fast internet and low latency they require to function on the go. Since 5G will basically convert home internet routers into cell sites, coverage will increase. As a result, more mainstream applications of VR and AR will be possible.
Driverless cars are one of the decade’s most fascinating inventions. Unfortunately, they may not reach their full potential due to network constraints. Such cars need to communicate with other cars as well as smart roads to maneuver traffic and ensure safety. This requires high speeds and low latency since communication, in this case, involves cars sending small packets of data instantaneously. The latency of 5G network is low enough for transactions to bounce back and forth between cars in as little as milliseconds.
5G internet has a much higher capacity than 4G and can easily meet the demand for huge capacities, that the latter can’t.
WHAT COMBINING 5G AND BLOCKCHAIN TECHNOLOGY LOOKS LIKE
The unique properties of blockchain such as security, transparency, and immutability, combined with the speed, low latency, and ability of 5G to connect to more devices, could have potentially amazing results for a number of applications. One such application is the connectivity of the Internet of Things (IoT). The IoT has existed for several years and has interacted with blockchain technology in several instances. One example is IOTA testing the communication between a mini-Tesla and a charging point over its network. However, progress within the field has faced three major challenges: speed, capacity, and security.
HOW WILL IT WORK?
According to McKinsey, 5G platforms can move more data in a shorter amount of time, allowing many of these low-powered IoT devices to communicate with each other. This solves the issue of speed and capacity, with the added bonus of connectivity, low energy consumption, and cheaper costs.
A blockchain network has the type of high-level security required for IoT applications to function properly. It almost fully eliminates the risk of transactions getting hacked because such device networks won’t have a single point of failure. More than 4.5 billion people use mobile phones globally, not to mention other devices that will likely communicate with others.
Security has to be tackled with scalability in mind and blockchain technology could provide it. Also, there has to be a way to validate the transactions between each device. The decentralized consensus used by blockchain can form the foundation of a fully functioning IoT 5G system. Blockchains also benefit from this combination since the users of IoT devices will indirectly adopt it.
OTHER PRACTICAL APPLICATIONS OF A BLOCKCHAIN AND 5G COMBINATION
INTERNET OF SKILLS
One new Internet of Things sub-are that will benefit from a combination of 5G and blockchain technology is the Internet of Skills (IoS). This field looks deep into devices and methodologies that allow people to carry out actions remotely. Essentially, many high-value tasks can be performed from anywhere in the world. For example, knowledge can be acquired remotely via online courses by anyone with an internet connection. This is IoS in its basic form. Another example is a doctor performing complex surgery on a patient without being physically present. The technology is usually supported by audio, visual and haptic technologies which have to be connected throughout such procedures.
However, existing wireless networks don’t have low enough latency for fast communication between all parts. This is where 5G comes in. During a medical procedure, every second counts and a lapse in time could translate to terrible consequences for the patient. This is why the speeds that 5G provides are a better fit. Blockchain technology ensures that the procedure isn’t disrupted by malicious external parties such as bots. The high level of security will give patients more confidence in the procedure.
REAL-TIME SUPPLY CHAIN DATA
The increasingly volatile economy, globalization, and the challenges faced during outsourcing have overpowered the basic automated supply chain model. Merely having a supply chain which updates itself long after the events have occurred on the chain just doesn’t get the job done anymore. Due to the presence of so many moving parts, it is difficult to keep track of everything happening.
If people are able to enter data into the supply chain in real time, tracking becomes easier. The data can also influence decision-making. However, real-time supply chains require seamless communication and connectivity to work well. Blockchain offers a secure, private network on which to host a supply chain. Data is entered and validated in real time through consensus.
5G network speeds, capacity, and latency underpin the network to ensure that there are no lags. While this sounds relatively easy, it isn’t. Synchronizing details in a supply chain when dealing with many products and large organizations is a challenging task. Ideally, a supply chain should be able to accept and read data to detect changes in facts such as supply and demand, price, and the business climate. This data is used to make informed decisions about the next course of action for a batch of products. Without structures that can support such a system in place, business (especially international business), becomes less efficient.
Using a blockchain and 5G as the backbone for a real-time supply chain will increase the amount of flexibility within the system. It will also ensure that different arms of the chain can easily analyze market changes, costs, prices and risks to avoid loss in the long run.
5g and blockchain will also help with smart contracts by allowing better connectivity between blockchains and oracles. A smart contract will only execute when a set of predefined conditions are met. But how does the smart contract know when to execute this event? Simple. Through the use of oracles. An oracle is a relay agent that finds and validates real-world data that can be used by a blockchain, to facilitate a smart contract.
Because they act as a data feed for smart contracts, high-speed internet is required. They also need low latency to be able to feed the contract continuously in real time. 5G offers these and could make access to such advanced supply chains possible for those in remote areas.
Oracles are part of multi-signature contracts where for example the original trustees sign a contract for the future release of funds only if certain conditions are met. Before any funds get released an oracle has to sign the smart contract as well.
SECURE DATA TRANSFER
Using 5G wireless networks, data can be sent from one device to another at high speeds. With IoT devices set to increase in the coming years, a challenge in securing the data bouncing around so many devices has become apparent.
Blockchains are distributed data-storage structures, yet they are not optimized to store that amount of load. This makes it infeasible to store IoT transactional data on the blockchain. However, such data can be stored in other decentralized file systems that support blockchain data such as OrbitDB or the InterPlanetary File System (IPFS).
While the data itself is stored on these systems, a unique cryptographic number known as a hash number can be stored on the blockchain as a pointer to where the data files are stored. Tampering with the data will cause the hash to change and draw attention to the attack. This method of storage may not be sufficient to protect the data fully, but it will provide better security than most centralized options available.
Automation will allow artificially intelligent robots to carry out the most mundane tasks in homes and industry. Autonomous cars and smart homes are part of this automation sweeping across the world quickly. Blockchain and 4G offer a way for such smart objects to collect real-time data and self-improve. Some of these objects include:
Tesla is one of the most popular examples of a smart car; one of its main features is autopilot. To successfully run its autopilot feature, a smart car would have to sense traffic, stops, direction, location, and the terrain. Although Teslas can effectively sense any of these things, imagine the possibilities with an even faster network.
More features and more accurate driving can be expected from smart cars that can collect and analyze data in real time at super-high speeds. They may also be able to interact with other smart cars on the road to share data.
Essentially, a “smart home” is equipped with smart devices that improve the living experience by automating many tasks that humans would otherwise handle manually in the home. These devices can include speakers, computers, cameras, smart appliances like fridges and washing machines, televisions, security systems, smartphones, and more.
Like smart cars and cities, these devices have to continuously interact with their environment and in some cases, other devices. Facilitated by 5G network and blockchain technology, data can be collected and stored securely at high speeds in real time.
Smart cities are urban areas that collect real-world data using Internet of things (IoT) sensors and then use this data to improve the lives of its citizens. By continuously collecting data, cities can be better informed on how to make their infrastructure and processes more efficient. For example, smart roads can collect data from vehicles and traffic pattern and send it to a device where it is stored.
Such data can give city authorities a better idea of how to solve any traffic challenges. Anything from energy creation to air quality and environmental control can be improved through data collection via IoT devices. These devices cannot connect with each other and send data at a fast rate between themselves without the help of 5G.
REPLACING HUMAN LABOR WITH AUTOMATION
The subject of replacing human labor with automation has been around for a long time. In many industries, it costs corporations less (long-term) to automate several industrial processes. For example, Cainiao, an Alibaba-owned logistics firm had over 700 robots in its warehouse to take on the workload of Single’s Day, its annual buying event.
According to a report by CNBC, the company dealt with over 800 million transactions during the Single’s Day event in 2017. Finding human labor sufficient to handle such a task would expensive when considering how many people would be required. Many more robots are being developed to take on far more challenging tasks. Although there have been many advancements within the space, there are also challenges with connecting devices. 5G network could improve connectivity across the board.
NETWORK AND TECHNOLOGICAL IMPROVEMENTS TO DATABASES
The range and bandwidth of blockchain networks and other databases can be improved by 5G due to its low latency, and capacity. If there are no speed problems, more nodes may be encouraged to join the blockchain.
5G will also allow blockchain to reach more remote areas and improve its ability to connect to mobile devices such as phones and tablets. With more nodes on the network, there could be better decentralization and in turn, better security through consensus. Lower latency periods will allow for experimentation with block times and sizes. In conjunction with high speeds, it may also allow for better applications of the technology in cases such as remittance.
CHALLENGES AND OBSTACLES FACED WHEN COMBING 5G AND BLOCKCHAIN TECHNOLOGY
As stated earlier, 5G has several qualities which make it a perfect supporting technology for various real-world applications including the Internet of Things and its sub-areas. Unfortunately, there are drawbacks that manufacturers have to overcome before the use of this technology can truly be seamless.
The first major issue is that of security. With an estimated 10 billion IoT devices by 2020 and 22 billion by 2025, it stands to reason that there will be a significant number of malicious devices. Such devices could lead to chaotic outcomes especially since their interconnectedness is necessary for the system to function properly. For example, malicious devices may try to intercept transactions between other devices. Without human interference in such transactions, it may be difficult to detect when this has occurred.
A second challenge is that the release of 5G network may cause an overload, promoting scaling issues to arise. With qualities like faster speeds and shorter response gaps, it won’t be surprising if people immediately want to switch to the network and start trying out various IoT applications. Even with a blockchain in place, the issue of scalability is ever present.
THE IMPACT OF 5G AND BLOCKCHAIN CHALLENGES
Both issues overpower the benefits of most technologies and render them nearly useless for IoT applications. If devices cannot collect data and carry out transactions securely, then the whole field of communication between devices cannot progress. If a doctor in Sweden can’t remotely perform surgery on a patient in France for fear that the network will cut off in-between procedures as a result of scalability issues, then that sub-field of medicine cannot progress either. Neither can those who write interactive university examinations or carry out complex manufacturing and design operations without being physically present.
Blockchain projects could solve the first challenge since security is one of the main features of a blockchain. The emphasis on using cryptographic techniques to ensure that data entered on a blockchain is tamper-proof and gets from sender to recipient without being hacked is a useful addition to the 5G network. It can be added as a foundation for regulating smart contract and IoT disputes.
IoT devices store their identities in cloud servers where their data is not secure. Decentralization shields their digital identity from any external parties and offers privacy in their transactions.
The issue of scalability is not as easy to solve. IoT devices will simply overwhelm the network with the thousand of on-chain transactions that will most likely occur every second. To solve this problem, there will need to be a significant improvement in the scalability of blockchain technology in the near future.
The lightning network has seen some recent progress in this area, and the latest Bitcoin Cash ABC fork has better scalability due to an improvement in block sizes. Ethereum’s plasma network and its sharding update, as well as plans to migrate to Proof of Stake, are all steps toward solving the issue of scalability.
Another approach is IOTA’s Directed Acyclic Graphs (DAGs) structure which if perfected, could carry the impending transactional load. However, with every progression toward scalability, security and decentralization reduce. No blockchain-based IoT network will function efficiently without solving these challenges first. The onus is on developers and manufacturers to collaborate on solving them since both groups as well as the global population stand to benefit a lot from the success of such a technology.
Looking at the benefits and challenges of combining 5G and blockchain technology for IoT applications, several questions come to mind: Is it worth it? Is it worth the cost of development? How certain is it that blockchain scalability will catch up to the growth rate of IoT devices?
From what is currently known about blockchains, they have underpinned various cryptocurrencies, each operating at different speeds, which means that blockchains can indeed be adjusted. This makes the possibility of creating a perfectly scalable system less-far-fetched.
Both 5G and blockchain technology promise benefits and solutions that will easily boost almost any system in the world, from payment processors to e-commerce and supply chain management. So as for the question of whether it is worth it, the answer is yes. It is absolutely worth the cost of development to create a scalable and secure backbone for IoT interconnectedness. This is crucial to the world’s evolution into a smart, connected system.