Vericoin rolls back block chain after attack on Minptal, community outraged by this blatantly centralized action

vericoin

On July 13 the cryptocurrency exchange MintPal was hacked, and $2 million of Vericoin was stolen, which is nearly 30% of all the Vericoin in existence. This is one of the biggest cryptocurrency crimes this year, and such a loss could cripple Mintpal, which is the most popular alternative cryptocurrency exchange. Also investors who had their Vericoin on Mintpal  stood to lose all their Vericoin, which would damage the community. The expected price crash from the hacker dumping 30% of all the Vericoin in existence would also cause major damage to everyone invested in Vericoin. As if this wasn’t bad enough already, Vericoin is a proof-of-stake (PoS) cryptocurrency, so having 30% of the total coins means controlling 30% of the network’s hashing power. The hacker could repeatedly attempt to double-spend, and they would succeed after only a few tries on average. If they managed to amass 51% of all the Vericoin in existence they would be able to succeed at double spending 100% of the time. In either case, having a hacker control such a large percentage of Vericoin is dangerous.

Vericoin’s developers responded to this by forking the blockchain, so that all transactions from the moment of the hacking onwards were reversed. This returned all the coins that were stolen , saving Mintpal from insolvency and preventing the possibility of a double spend attack by the hacker. This is controversial however, since it defeats the purpose of a decentralized cryptocurrency. The developers proved that they are in full control of Vericoin, capable of taking anyone’s Vericoin away for any reason. Some worry that rollbacks will become more common and the justifications will get weaker. One’s trust in Vericoin is now only as strong as his/her trust in the developers. This rollback is unlikely to set a precedent for cryptocurrency developers, since there has been strong community backlash after the Vericoin rollback.

At the same time, some see the rollback as an advantage that only cryptocurrency has. Never in history has a robbery been reversed by simply rolling back the ledger of transactions to the time before the robbery. If this was possible for fiat currency robberies and scams could be easily reversed, saving innocent victims millions of dollars. It gives a lot of power to whoever is in charge of the currency however, which can be quite dangerous. Imagine a government that has the ability to reverse money that was sent to your bank, or to reverse payments for services/products that they had already received. Clearly it is important that transactions can’t be reversed by a central authority, which is why the Vericoin rollback has drawn so much controversy.

—Thank you to Kefkius for contribuiting to this article

ScamCoin launching tomorrow, will be the 3rd cryptocurrency named ScamCoin

scamcoin

There are numerous scams in the cryptocurrency world, and oftentimes entire cryptocurrencies end up being scams. Dafuq Coin ended up being malware, and anyone who installed it on their computer or exchange was at risk of losing their cryptocurrency. StackCoin, EdgeCoin, and NFD-coin were initial public offering (IPO) scams, where the developer disappeared and never released the coin despite receiving large amounts of Bitcoin from investors. White Coin, Asia Coin, and many others were pump and dump scams, where the developer dumps the entire premine, destroying the cryptocurrency’s price, and then they disappear.

These events have inspired a new cryptocurrency: ScamCoin. ScamCoin will be launching tomorrow, and it is not trying to hide the fact that it is a scam. It will be using the X13 algorithm and is Proof of Stake (PoS), and has a short mining period of 3.5 days. These attributes would usually make for a popular cryptocurrency, at least in the short term after launch. There is a 1% premine, so perhaps the developer is planning on doing the classic pump and dump scam. Even though ScamCoin seems like a terrible thing to mine, it is almost guaranteed that people will mine it. You can name a cryptocurrency anything and it will attract interest from the community. Read more about ScamCoin here: https://bitcointalk.org/index.php?topic=665169.0

ScamCoin is not the original ScamCoin however, there have been 2 more in recent history. The ScamCoin that was released in February 2014 utilized the classic IPO scam. Shockingly, someone actually did invest 0.025 Bitcoin. To the surprise of no one, the developer disappeared and this version of ScamCoin never launched: https://bitcointalk.org/index.php?topic=475287.0

The original ScamCoin came out in January 2014. The developer gave away lots of ScamCoin for free, but it appears the wallet may have had a virus, and it barely worked. https://bitcointalk.org/index.php?topic=431205.0

If you like getting scammed, get your miners ready for ScamCoin’s launch tomorrow. What could go wrong?

The first cryptocurrency endorsed by the glorious leader of North Korea ends up being a scam

cryptowon

The CryptoWon was scheduled to launch June 10. It was the first cryptocurrency endorsed by the dear glorious eternal leader of North Korea, and promised to obliterate all other cryptocurrencies. It was supposed to be the first cryptocurrency to use proof of labor (PoL) and proof of bureaucracy (PoB).

The developer had an initial public offering (IPO), where you could buy CryptoWon with Bitcoins. 0.339 Bitcoin was invested, worth $200 ( https://blockchain.info/address/12ciZ7yHaKjAw57hB6odGr4UELMJ9t1t9s ). The developer disappeared before the scheduled launch on June 10, and at this point it appears the CryptoWon was never created.

Thus, CryptoWon is a scam, joining the ranks of EdgeCoin, StackCoin, NFD-Coin, White Coin, and many others. It is rumored that the CryptoWon scam has doubled the national budget of North Korea for 2014.

UFO Coin to be revamped on July 2nd, with new hashing algorithm Neoscrypt and security improvements

ufocoin

UFO Coin was originally launched in January 2014, but is going to be completely revamped on July 2nd (about 10 days from now).  UFO Coin’s algorithm will be changed from Scrypt to NeoScrypt, which is an improved version of Scrypt created by the Feathercoin development team. NeoScrypt will be 30% more energy efficient than Scrypt, and ASIC resistant. ASICs have recently taken over Scrypt mining, making it unprofitable for GPU/CPU miners to mine Scrypt. NeoScrypt will allow GPU/CPU miners to profitably mine UFO Coin again, which should make UFO Coin more popular. NeoScrypt is somewhat similar to X11, in the sense that X11 makes mining more profitable for GPU/CPU miners and is more energy efficient. X11 has become extremely popular this year following the release of Scrypt ASICs, since all the GPU/CPU miners are flocking to X11.

Additionally, UFO Coin will implement Nite’s Gravity Well, which allows for rapid response to hash rate changes. This will help prevent multipools from ruining mining profits. A multipool is a large collection of miners who mine the most profitable coin at any given time. With Nite’s Gravity Well the payouts for UFO Coin per MH/s will rapidly drop when a multipool starts mining UFO Coin, which will force the multipool to mine something else. Then payouts will rapidly increase when the multipool leaves, benefiting UFO Coin GPU/CPU miners.

The new release of UFO Coin will also make the chance of a time warp attack negligible. During a time warp attack the difficulty is reduced below where it should be, allowing the attacker to mine coins much faster than they should be able to. Also, UFO Coin will have automatic checkpointing set to a low depth, which will prevent transaction rollbacks via a 51% attack. Thus, UFO Coin will be much more resistant to 51% attacks and time warps, making it a safer cryptocurrency.

There will be 4 billion UFO Coins in total, with 5000 coins per block and a new block every 90 seconds. Every 400,000 blocks the block reward halves. Currently UFO Coin is near block 150,000, so no halvings have occurred yet. The update will occur at block 160,997 via a hard fork, and block 160,997 is expected to occur on July 2.

There are several pools where you can mine UFO Coin, and currently the network hash rate is 140 MH/s. This represents a significant amount of mining power, equivalent to 100 small ASICs. However, relative to other cryptocurrencies UFO Coin’s hash rate is small to medium. It is probable that UFO Coin’s hash rate will increase after improvements are implemented on July 2. UFO Coin is not actively being traded on any exchange, but that is expected to change soon after the update, since there is significant community interest in UFO Coin.

The developers of UFO Coin hope to setup up a fund for SETI (The Search for Extraterrestrial Intelligence) as well as other projects which are trying to find extraterrestrial life, making UFO Coin the first interplanetary cryptocurrency. Considering that UFO Coin has a strong development team and is scheduled to make some revolutionary changes to its code, I think it’s worth mining. The official statement from the developers regarding the UFO Coin update can be found here: https://bitcointalk.org/index.php?topic=658117

DarkCoin masternodes fail again, price crashes

darkcoin

About a month ago DarkCoin attempted to implement masternodes. Masternodes are used to ‘mix’ DarkCoins, making transactions anonymous. If you own a masternode you get paid a portion of the block reward every time your masternode is selected, which would be quite lucrative over time. This generated a lot of interest from the community, and DarkCoin’s price soared to 0.028 BTC/DarkCoin. Unfortunately, the implementation of the masternodes failed and resulted in many forks, destabilizing the entire DarkCoin system. DarkCoin was briefly delisted from exchanges and its price crashed below 0.01 BTC/DarkCoin http://www.usacryptocoins.com/thecryptocurrencytimes/uncategorized/darkcoin-blockchain-forks-resulting-in-price-crash-and-temporary-delisting-from-exchanges/

The DarkCoin development team had been working on a fix for the masternodes, and tried launching masternodes again today. Speculation drove prices up to 0.021 BTC/DarkCoin before the masternode launch. The masternode launch was a failure once again. Forks developed in the DarkCoin blockchain, making it dangerous to send and receive DarkCoin. The developers of DarkCoin were forced to halt masternodes and go back to the original DarkCoin code. https://darkcointalk.org/threads/reverting-rc3-masternode-payments-fork.1458/

The price of DarkCoin crashed 30% after today’s failed masternode launch, ending up around 0.015 BTC/DarkCoin. I expect price to continue declining in the short term, since masternodes were the main reason DarkCoin’s price was rising. It’s hard to tell where the bottom will be, and investing in DarkCoin now is a risky decision. DarkCoin is still near the top of a price bubble, and bad news like this may be enough to finally pop the bubble.

Bacon Coin: the first bacon inspired cryptocurrency

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Bacon Coin launched earlier today. It is the first cryptocurrency inspired by bacon, which is a delicious meat product prepared from a pig and then cured. There will be 21 million Bacon Coins in total, with 50 per block and a new block every minute. 20,000 Bacon Coins were premined.

Bacon Coin was created with Coingen, which is a service that makes your own cryptocurrency in exchange for a fee. This means that if Bacon Coin ever has a problem it likely won’t be repairable. That being said, even broken bacon is still delicious. The network hash rate for Bacon Coin is extremely low, so you can easily solo mine Bacon with your own computer. It is unlikely Bacon Coin will ever get listed on an exchange, but crazier things have happened.

This is another example of how there is a cryptocurrency for almost anything. I expect Egg Coin, Pancake Coin, Syrup Coin, and Butter Coin to be launched in the near future, and combined with Bacon Coin it’ll make for a hearty cryptocurrency breakfast.

Wild month on the Bitcoin market

bitcoin

Bitcoin experienced a rapid price increase during the latter half of May, going from $430 on May 12 to $683 by June 1. This corresponds to a 59% increase in price, and the total value of all the Bitcoins in the world (often called the market cap) rose from $5.6 billion to $8.5 billion. This is the biggest price increase Bitcoin has seen during 2014.

After the rally ended on June 1 the market was volatile, but the price of Bitcoin stabilized around $660 by June 6. Bitcoin’s price began to slowly decrease on June 9, and this trend accelerated into a full blown crash on June 12. Bitcoin dropped to $538 on June 14, corresponding to a 19% drop during the week. The market cap dropped from $8.5 billion to $6.95 billion during the same time.

wildbitcoin

The price of Bitcoin then began to rise again, and is now at $590, a 10% increase in 36 hours. Most of this price increase has occurred over the last 9 hours, and it can probably be considered a small rally. The market cap of Bitcoin is now $7.6 billion.

Thus, the Bitcoin market is having a wild month. Price swings of 10% or more within a couple of days are the norm for now. It’s a day trader’s dream and worst nightmare at the same time. It looks like Bitcoin’s price will continue to rise overall, so if you have long term investments in Bitcoin its best to ignore the day to day volatility.

Dogecoin market analysis June 12 2014

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The Dogecoin market had been slowly declining since it rallied on June 1, and reached a low of 53 satoshis (1 satoshi = 0.0000001 Bitcoin) on June 6. At that point the USD value of Dogecoin was $0.000347, with a market cap of $28.7 million. The price of Dogecoin then began slowly increasing, culminating with a rally on June 11 to 70 satoshis. The USD price of Dogecoin rose to $0.00045. This corresponds to a 32% price increase relative to Bitcoin, and a 30% price increase relative to the USD.

After the rally ended the price of Dogecoin began to decline again, and now sits at 63 satoshis. This is still 19% higher than the price before the rally. The current value of Dogecoin is $0.00037, up 7% from a few days ago. The price of Bitcoin drastically declined over the past couple of days, from $650 to $590, which is why the increase of Dogecoin’s price relative to the USD isn’t as impressive as its increase relative to Bitcoin. The current Dogecoin market cap is $31.2 million, which is 7th highest out of all cryptocurrencies. A slight increase in the market cap would put Dogecoin ahead of Ripple.

Dogecoin’s price has been on a long downtrend since it peaked in February. However the price decline has been slowing, and perhaps the 2 rallies we’ve seen so far in June are a sign that Dogecoin is poised to start rising again.

BurnerCoin: a new X13/PoS cryptocurrency, ninja launched yesterday

burnercoin

BurnerCoin launched yesterday. There was no announcement that a launch was coming, rather by the time BurnerCoin announced they existed mining was already occurring. This is called a ninja launch. Ninja launches are extremely unfair to the community, since the developer of BurnerCoin and all his friends were able to mine BurnerCoin before anyone else knew about it. This is essentially the same thing as a premine, except less honest.

It appears about 200 blocks of BurnerCoin were mined during the ninja launch, which is roughly 40,000 BurnerCoins. There are going to be 2 million BurnerCoins mined in total, so the ninja launch accounts for about 2% of total coins. On top of the ninja launch premine, 2 BurnerCoins per block will be set aside for “support costs”, which is 20,000 total. This brings the premine to 60,000 BurnerCoins, or 3%, which is a relatively large premine.

BurnerCoin has some desirable characteristics. There are only going to be 2 million BurnerCoins mined in total which is a relatively low amount and should lead to a higher price. BurnerCoin will become proof of stake (PoS) after 1 week of mining, which means you earn more BurnerCoins just by keeping them in your wallet. The PoS interest rate is 25%, which is relatively high. PoS cryptocurrencies have been extremely popular this year.

Also, BurnerCoin will use the X13 algorithm, which is more efficient and profitable than Scrypt for GPU/CPUs. X11/X13 has been the most popular algorithm for new cryptocurrencies for the past couple of months. The combination of PoS and X13 is sure to generate a lot of community interest for BurnerCoin. Indeed, an active community is already developing around BurnerCoin with 10 pages of discussion on Bitcointalk: https://bitcointalk.org/index.php?topic=645753.0 The network hash rate for BurnerCoin is an impressive 50 GH/s, representing a lot of mining resources pooled together. BurnerCoin will likely have a high price when it hits exchanges, which should happen shortly. Thus, despite the ninja launch BurnerCoin’s attributes have made it popular.

There are now 2 different FuckCoins

fuckcoin1

There are thousands of different cryptocurrencies, so perhaps it shouldn’t be a surprise that there is a FuckCoin. However, there are now 2 different FuckCoins. The original FuckCoin was launched in January 2014 and uses the Scrypt algorithm. There are 69 FuckCoins per block, a new block every 69 seconds, and 100696969 FuckCoins in total. The block reward halves every 696969 blocks. The theme of FuckCoin is clear. Somehow FuckCoin gained a small community, proving once again that you can make any cryptocurrency, and no matter how idiotic it will attract attention. https://bitcointalk.org/index.php?topic=421182.0

fuckcoin2

A brand new FuckCoin launched today. Apparently the developer didn’t do his research and had no idea FuckCoin already existed. The new FuckCoin uses the Scrypt algorithm, with 300 FuckCoins per block, a new block every minute, and 60 million FuckCoins in total. The only ascertainable difference between the old and new FuckCoin is the first FuckCoin seems to be based on fucking, and the second FuckCoin is based on flipping people the bird, at least based on their logos.

The new FuckCoin is off to a poor start, there is no community to speak of. Also their website is completely in Chinese so its impossible to find where to download the wallet ( http://fuckcoin.cc/ ). Clearly the old FuckCoin will remain dominant.