Here we go again. It appears as if there's another bitcoin fork on the way after all.

The development team supporting Segwit2x announced last week that implementation would be cancelled due to withdrawn support. Over and out.

Not so fast says quite a few in the mining community that did not withdraw support. They plan to move forward with Segwit2x after all and Coinbase among others are going to be there to support the fork as well.

Thus, it appears as if there may be another altcoin created like that of Bitcoin Cash. Bitcoin2x after all.

Coinbase Status

SegWit2x

Segwit2x was to be the bitcoin fork that achieved consensus earlier this year to raise the 1MB limitation to 2MB among other items. However with withdrawn support falling under the consensus mark, the development team decided to cancel the fork.

Too late, says a portion of the mining community and exchanges like GDAX, a Coinbase operated exchange. Coinbase was a prominent supporter of Segwit2x and is moving forward with its plans as well.

That portion is rather considerable given a couple heavy hitters on the roster:


Support

Coinbase
Bitfinex
HitBTC
CEX.IO
GDAX

Probable Support
Gemini
Mercado Bitcoin

Like with Bitcoin Cash, if you have bitcoin at the fork, you'll have what's being dubbed "bitcoin2x" as well.

Sounds like the dream of Bart Jellema, who bought over $70,000 in Segwit2x futures, might still be alive. This could certainly increase the value of bitcoin for the short term as well if people begin throwing money at bitcoin in hopes of instant cash with bitcoin2x.

You can learn more about bitcoin2x on the website.

Get on it!



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Square has been notorious for tormenting bitcoin traders for using their accounts for buying and selling bitcoin resulting in thousands of Square users funds being locked for 6 months to a year or confiscated all together.

This is a practice it's largest competitor, Venmo (Paypal), also engages in to the point they directly mention bitcoin is against their policy in their terms of service.

Now all of a sudden a limited number of users of Square's Cash App have been given the option to buy or sell bitcoin within their accounts.

Square spokesperson said in a statement that Square is: 

"exploring" the option due to interest from customers, and the feature has been provided to a "small number" 

The app allows them to buy/sell and hold, but not send (currently). This is exactly what thousand of people have tried to do with Square's processing services only to get demolished by the organization.

This is also similiar to the bitcoin/blockchain defector Circle, although Circle also allowed folks to transfer funds and make payments with bitcoin so it was a notch up. 

The app, however, potentially fills part of the gap left open by Circle's exit from the industry.

Granted, this is the Square cash app and not Square's processing services which we can only assume are still not allowed for processing payments for purchasing bitcoin, however it's the same company and this is possibly something that will be scrutinized by many since using Square's Cash App for purchasing bitcoin from sellers is also frowned upon.

Nevertheless, a company the size of Square can usually get away with this kind of activity 

It just seems a bit like a case of the Pot calling the Kettle black. 




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Bitcoin toppled over the the weekend falling as low as $5,800 while Bitcoin Cash rose as high as $2,800. For a minute it appeared as if the two might cross. Fast forward a few days and Bitcoin has return to over $7,000 reaching a high of $7424 in the last 12 hour session and currently holding over $7,300.

Falling Down

The dip had multiple causes.

Bitcoin's lack of a scaling solution paired with it's increasingly high fees have it currently in a very vulnerable situation poised to fall to a successor.

To add to that an attack on the network over the weekend brought the blockchain to a crawl with nearly 200,000 transaction stuck due to over 50,000 transaction of nearly no fee in an apparent SPAM attack had many looking to other currencies such as Bitcoin Cash, Dash, and Ether for refuge.

Bitcoin Gold also went live.

Strength in History

Regardless, bitcoin has been around a long time. It's price is the result of many trials and tribulations resulting in a fairly reliable asset.

Those with a strong stomach who frequently buy on the dip are rejoicing today having profit greatly from the activity.

However, invest with caution. Bitcoin's high fees and development turmoil are likely to cause it some grief if not remedied, so keep informed and pay attention to things as they develop to avoid loss.

In the end, it's likely that bitcoin will continue to increase in value and it's back on it's current trajectory now. Just be cognizant of the fact that it's current issues and forks of self-proclaimed "better" solutions could change that at any point in time. Case in point ... last weekend.

Get on it!



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The blockchain (bitcoin) is at a crawl with over 165,000 transaction cram packed plugging up the network. There's been speculation of spam, an attack, a malicious attack from other coins, folks desperately trying to move coins into other coins, etc...

Without any scaling solution to date, this is just a mess that was bound to happen. It's not like it's the first time this has occurred, and assuming bitcoin survives the week, it likely won't be the last.

What Can You Do?

Here's a list of things you can do to handle the situation.

1. Wait

If your transaction(s) isn't critical, the best thing you can do is just wait. The blockchain will eventually clear up and things will move along. 

2. Send High Fee

The second thing you can do is that if you haven't already sent your transaction, make damn sure you send it with an appropriate fee. The highest you can afford. This will give the transaction preference with a better chance to hit the next block or 20. 

If you're sending a single transaction you can use services such as https://estimatefee.com/ to calculate the fee you should send. At the time of this writing the going rate is about 700 sat/per byte. Fill in the form and it'll calculate the transaction for you.

If your sending manually and just want to calculate this yourself, then get the recommended fee from the link above or from https://bitcoinfees.earn.com/ (by 21). They also have an API to do this if you're running things programmatically. 

The endpoints are located here: https://bitcoinfees.21.co/api

You'll need the number of inputs and outputs to calculate the fee. If ins is inputs and outs is outputs and you have two of each. The calculation would be as such using spb as satoshis per byte:

fee = spb(((ins * 148) + (outs * 35)) + ((1 + 12 )+ ins)) 

If spb was recommended at 700 sat/byte then the fee would come to 266700 sat. Which you would multiply by 0.00000001. Which means the fee would be 0.002667. With the going rate of $6,145 that would come to $16.39 (rounded up) for a fast transaction.

[code type="JQuery"] function GetFee(ins, outs){ $.ajax({ url: 'https://bitcoinfees.earn.com/api/v1/fees/recommended', jsonpCallback: 'jsonCallback', contentType: "application/json", dataType: 'json', async: false, success: function (json) { var estm = (ins * 148) + (outs * 35) + 2 + 10 + ins var fee = ((estm * (json.fastestFee)) * 0.00000001); return fee; }, error: function (e) { console.log(e.message); } }); } [/code]

3. Replace The Fee 

If you have already sent the transaction and the fee is low, replace it with a higher fee. If you're using Electrum for example, you'll want to simply right-hand click on the transaction and select "replace fee". Enter the higher fee and then send/broadcast the transaction.

4. Push the Raw Transaction

In some cases, if you do not see the transaction on the blockchain, it may not be broadcast or has other issues. In this case you can manually push the transaction from Bitcoin Core or a service or API. 

First you need the raw hex. You can do this a few different ways.

From Electrum console:

Enter:

>> gettransaction('c5cd7d84778d443b05dfa1823413d79c91358be9608cf6f96f7cff01d448e591')

Return:

{
"complete": true,
"final": true,
"hex": "0100000001bc0c310b2cd2fc214daacc689b460b503a193dcb6b6f25269d93f8c4bc641e1c4c0000006b483045022100bfc0f45a0f0a890bb77b6749e6306919c918fc127ee4c8e1cfe353a79b4451c8022023a96ee5844dde11a59385940fc5d33bce96013cea97464f511e677cc1c41344012103080da602fd8cc0ce86b126d3eeae1141201499115eca35c6e6452985379ee3f7ffffffff0240420f000000000017a914dcaae569708dc17862fef2edde6e48fdd1759a6a8792fdb000000000001976a91499615a10294070621b1f9c727c44f5a4818e001488ac00000000"
}

The highlighted portion is what you are looking for.

From Blockchain.info:

Append the following: ?format=hex

Enter: blockchain.info/tx/c5cd7d84778d443b05dfa1823413d79c91358be9608cf6f96f7cff01d448e591?format=hex


From Blockcypher:

Append the following: ?includeHex=true

Enter:

 https://api.blockcypher.com/v1/btc/main/txs/c5cd7d84778d443b05dfa1823413d79c91358be9608cf6f96f7cff01d448e591?includeHex=true

Once you have the raw hex code you can push the transaction. Blockchain.info has a simple tool for this if you don't feel comfortable in the console of Core. You can use blockchain.info/pushtx and enter the hex code from above.



If successful you'll get a "Transaction Submitted return.

These are just a few tips you may find useful. If all else fails you can always "Child pays for Parent" back to yourself. That's where the parent transaction (the stuck one) piggy backs on a child transaction (a new transaction sending back to a wallet you own) with a higher fee. 

That another story for another day. Hopefully your transaction won't still be stuck when that day arrives. 
[info title="Info message" icon="info-circle"] You can always drop us a line at [email protected] if you need some assistance.We'll be happy to help.
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Depending on which second you look at the charts, bitcoin and bitcoin cash, BTC (ISO XBT) and BCH respectively are up and down like a escort on a Saturday night. One goes up, the other goes down, the other goes up, and the other goes down. 

Bitcoin, which was over $7,000 just yesterday and over $7,500 earlier in the week, hit as low as $5,800 over the last 12 hour session losing over $1000 of it's value. All the while many Altcoins were inching up and out of nowhere, BCH was well over $1000 hitting as high as over $2800.

Currently BTC is around $6,200 and BCH is around $1500 but this is expected to flip-flop gain as traders ride the peaks and valleys. Where it ends up is anyone's guess but there's allot of discomfort with bitcoin right now.

Bitcoin Cash, has allot of promise. You may remember the lightning network and BitcoinXT from a while back, that's what Bitcoin Cash is based on. Gavin Andresen, who worked on both Bitcoin and XT (hence BCH) tweeted this anout Bitcoin Cash:


Blockchain [email protected]!k

The blockchain currently has over 160,000 unconfirmed transactions and this has been getting steadily worse as people have been waiting for 20 hours or more for transaction to confirm. Rumors flying around point at everything from jumping ship for BCH to a network attack by anyone and everyone bitcoinists can think of. 

Surely it couldn't be because the blocks are STUFFED and there's NO SOLUTION in place to handle it, could it? 

No Scaling Solution for Bitcoin

Segwit2x was cancelled so the 2BM blocks consumers were hoping would speed up the network isn't happening. It simply failed to reach consensus despite the early flag for it in June. 

Many argue that 3 months is simply not enough time to go fill cycle and miners decided they didn't want to make the move.

To top that off, Bitcoin Classic is shutting down stating that Bitcoin Cash is accomplishing everything it was hoping to do so we can expect allot of the hashpower that was behind Classic to hop over to Cash.

Fee Insanity

Bitcoin was once a dream for sending money to people with it's low fees, you could send virtually any amount for just a few cent, maybe $1 in a pinch and I for one have always supported miners making some extra fees. Until now, with $7,000 per coin being handed out, or even $4,000m there's no reason on earth it should cost $5 to send $5. That's ridiculous. Try loading a BitPay card and with the load fee you'll spend $8-$9 to send $1. 

Remember this ad? Back in 2014 this was so threatening that even Western Union took legal action requesting it be removed from the planet. Obviously t didn't work since we found it.

Original 2014 Ad (Origin Unknowm)

Fast forward a few year, the lack of a scaling solution, and miners making a fortune on fees alone to 2017 and here's the NEW AD. I doubt Western Union will have a problem with this one.

2017 Ad (Origin Also Unknown)

We say $5, but if you really want it to get somewhere quickly, plan on more like $16. This makes coffee and a beer (two products commonly paid for with bitcoin) pretty damn expensive and rather useless unless one is trying to kick an alcohol or caffeine addiction, in which case this is spot on.

I think when the miners heard bitcoin was a payment system, they took it too literally because right now all you do is pay the system

Um... no guys, we need to pay other people too.

Add all of the above up and it spells look-for-another-solution ... and at the time being, it looks like Bitcoin Cash might just just be that solution.

BCH is on the rise. 

Get on it!




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According United Sates federal law 31 CFR, no.

I was delighted to stumble across the conversation going on here. The author was doing what many have done, file for an administrative determination on whether his business model fit the model of an MSB [Money Services Business]. But many great points are discussed, I encourage you to read for yourself. One of the best points was "TL/DR: Guidance is [FinCEN] way of saying "this old law applies to this new stuff and here is how and why". FinCEN doesn't pass laws so you are free to disagree. One should expect to find themselves in court if your interpretation and FinCEN interpretation are not in alignment. Depending on how strong your case is this could be a very good thing or a very bad thing. Only legislature can pass new law and ultimately the courts will decide if the law is applicable." This is actually correct! FinCEN does not legislate.

When I asked Key Bank if someone like me who only purchased bitcoin for my own account and only sold bitcoin from my own account directly to a customer was a money services business? They easily determined from 31 CFR 1010.100(ff) that I was not. Of course, it helped that they had a former employee of Fincen working in their compliance department. Key bank easily determined that I did not fit any of the MSB models mentioned in the document. At first glance it looks like section 5 might apply, but this is easily negated by limitation (ii) F which states "A person who accepts and transmits funds only integral to the sale of goods or the provision of services (other than money transmission services) by the person who is accepting and transmitting the funds." This means accepting payment, or making payment for the sale or purchase of goods and services IS NOT money transmission. We can easily see this example when we shop at a store. The clerk that uses VISA to accept money from a customer is not a money transmitter precisely because of this limitation. In fact, each and every one of us would be a money transmitter if not for this limitation. Thus, we can make this determination without ever even confusing ourselves with complex guidance from FIncen which essentially says the exact same thing, albeit more verbose and at times possibly circuitous. 

Now, what FinCEN will say when I request an administrative ruling I can't even predict given the random responses their customer service department gave me. I asked them what if any MSB I was and I was told I was a currency exchanger! [Dealer in Foreign Exchange] Then I asked if I need to check ID for sales $3,000 and over and they replied I must save my reports for 5 years. I don't consider either response as anything rational or reasonable making any sense. No supporting documentation citing laws or regulations was included. When I questioned the responses, my further questions were ignored. On the phone when I read FinCEN FIN-2008-G008 the representative wasn't even aware of the content as written. This leads me to wonder, "Is anyone at FinCEN even qualified to give any guidance on CFR 31 and Money Services Business laws? Perhaps there should be an inquiry into this. I plan to write to congress about my experience and how I was given inaccurate answers or no answers at all. My second thought is that they may in fact be capable but instead choose to intentionally mislead which is just plain tyranny if true.  

What about 31 U.S. Code § 5330 - Registration of money transmitting businesses?

(d)Definitions.—For purposes of this section, the following definitions shall apply:(1)Money transmitting business.—The term “money transmitting business” means any business other than the United States Postal Service which—(A) provides check cashing, currency exchange, or money transmitting or remittance services, or issues or redeems money orders, travelers’ checks, and other similar instruments or any other person who engages as a business in the transmission of funds, including any person who engages as a business in an informal money transfer system or any network of people who engage as a business in facilitating the transfer of money domestically or internationally outside of the conventional financial institutions system

I think once again here it is very clear the person must be engaging in a business that facilitates money transfers. A person simply buying or selling bitcoin as his primary purpose wouldn't fall under this definition, even if tricked into providing a few money transfers under the guise of making sales or purchases. As long as the trader wasn't advertising remittance services to transfer money to third parties for a fee. This is common sense and to think otherwise is an intentional misreading of the law as written.

And what about 18 U.S. Code § 1960? This is basically the punishment for not complying with section 5330 of title 31 above. It only summarizes the definition which is defined in section 5330. It also includes transmitting proceeds of illegal activities or funds designated for illegal activities.

* Disclaimer this is not intended to be legal advice and is solely the opinion of the author based on reading the applicable laws and regulations.

--Scott
Editors note: Please review the disclaimer(s) of our Terms of Use. As the author indicated, this is not legal advice. We recommends always seeking advice from legal counsel.




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New charges have been filed against a Pennsylvania-based day trader accused of securities fraud and market manipulation.

Willner was accused this month by the U.S. Securities and Exchange Commission (SEC) of breaking into over 50 brokerage accounts and conducting short sales designed to generate $2 million in revenue resulting in $700,00 in profits.

Willner then traded cash for bitcoin through an online exchange and sent the funds to a partner (not named in the complaint) to "hide" and unassumingly trade for cash to split at a later date.

"I know you wanted to make sure I btc [bitcoin] you but already impatient for 1450?"
 - Individual A (unidentified co-conspirator)

The new charges are brought by the Justice Department which includes counts of Securities Fraud and Conspiracy to Commit Money Laundering and Willner faces up to 20 years in prison if convicted.

In this case, Willner wasn't really in the business of trading bitcoin per say, he used the digital currency as a tool to launder funds from illegal day trades. He wasn't in the industry. It is unclear if "Individual A" was or was not and is only described in the indictment as a foreign national.

Taking proceeds from illicit activity and exchanging that for bitcoin in an attempt to hide or funnel those funds is an apparent, and obviously piss-poor, attempt at laundering money.




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SegWit2x, Segregated Witness phase 2, has failed to reach consensus and as a result, has been cancelled. This means, no new hard fork. No new free money. No big surprise.

It's been apparent for some time that this wasn't going to fly. Which makes you wonder why on earth some folks did things like this.

A gentlemen by the name of Bart Jellema spent nearly $80,000 buying B2X (futures) with the hopes that the fork would happen and he'd get rich quick. If anyone sees this man in the office tomorrow, check the forward for bruises, he's likely to be up all night banging his head against the wall.

Given the success of Bitcoin Cash (BCH) not to long ago this may have seemed to be a fairly good gamble. However there's just one problem, this involved two painful things. SegWit and availability.

Fork for Bigger Blocks

Had the fork occurred, there would have been 2 new distinct chains, one with supporting 2MB blocks. However, it didn't, and isn't going to. Yet.

One thing is certain. Blocks are slow and mining fees are ridiculous.

Something needs to change.



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A former U.S. Secret Service special agent who is currently serving a near six-year prison sentence for stealing bitcoin during the Silk Road investigation was ordered to serve two additional years Tuesday.

Shaun W. Bridges, was ordered to serve 71 months in late 2015 after being charged with stealing bitcoin during the investigation along with Carl Force. This past summer he plead guilty to yet another charge of money laundering and has received another 2 years piled on to his current sentence.

I the midst of all of the P2P trader arrests for selling to HSI agents after being setup, it's almost shocking to see an individual who committed an actual crime, receive punishment.

Silk Road

Ross Ulbricht’s family claims that Bridges and Carl Force tainted the Silk Road investigation by with-holding information from the courts.

Defense attorney's also say that Force and Bridges had access to Silk Road administrator passwords, including private bitcoin keys and bank accounts. 

Bridges has admitted to stealing millions of dollars worth of seized bitcoins, stolen before he and Force were taken into custody. 




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The US Treasury intends to audit the practices of the Financial Crimes Enforcement Network (FinCEN) when it comes to virtual currency.

In a publicly available annual report published by the Treasury Office of Inspector General (OIG), among various audit points, virtual currency is mention several times specifically in how FinCEN is handling "the problem".

We plan to determine how FinCEN identifies, prioritizes, and addresses money laundering and terrorist financing risks associated with virtual currencies.

Well shit ... I can tell you that one. They get the HSI to setup fairly innocent bitcoin traders and conduct enough cash trades with them until they can throw them in jail. All while the actual criminals committing the crimes they are trying to prevent skip along like the ice-cream man is around the corner..

That's how it being handled.

The publish contradictory guidance that confuses the hell out of the average Joe to the point he has little to no chance of being compliant with regulations and any effort to do so is met with swift action and indictments.

That's how it's being handled.

They answer simple questions that they are supposedly the authority on with the wrong answers that can end up landing people in jail or fined by FinCEN for following their own advice.

That's how it's being handled.

They need a deep audit for this? Can't they read the news? Check out federal case files? It's not like all of this is shrouded in secrecy

...the universe of financial institutions required to comply with BSA requirements grows as nonbank financial institutions are required to report CTR and SAR data. The universe also includes the insurance industry and dealers of precious stones, metals, and virtual currencies.

How on earth is selling insurance, rocks, and metal in any way a financial institution? It's about as silly as P2P traders being called "financial institutions". Why can't they call them what they are and refrain from labels that make other "financial institutions" like banks, close the door in their faces?

They want assistance from these industries for doing their job, but do nothing to help keep these industries free from discrimination of which is only possible due to these industries attempts to follow the law and comply with regulations. 

Its like asking someone to lock the door behind you as you exit a burning building.

At least have the decency to call the fire department. 

The audit is scheduled for 2018, we'll report the findings as we learn of them next year. In the meantime, there should be another good 30 or 40 ridiculous arrests, confusing responses, and contradictions to guidance as a result of FinCEN's "practices", so I'm sure we'll be plenty busy until then.




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