Connect with us

#Ethereum

Do We Really Want To Tokenize Everything? And Can We?

Published

on

It’s not only gold that’s being tokenized. Other precious metals are also up for trade via blockchain technology. Stocks, bonds, and shares too.

Over the last year, there has been considerable discussion over the tokenization of physical assets. That is, having something tangible, like a bar of gold, represented by a token on a blockchain, like Ethereum or Bytom, so that there is an immutable record of ownership of the asset. This asset can then be traded or sold without the need for a middleman to keep a record of the transaction – and take a commission for his troubles – thus making the transaction safer, faster, and less expensive.

It’s not only gold that’s being tokenized. Other precious metals are also up for trade via blockchain technology. Stocks, bonds, and shares are all said to be next, and security token offerings are one incarnation of this move. In fact, STOs are hotly tipped to be the next big thing.

It seems anything worth anything is ripe for tokenization.

 

So, Everything Is Tokenizable?

Any blockchain that is capable of executing a smart contract (like Ethereum and Bytom that I mentioned earlier) offers the ability to have part-ownership of an asset. Recently, Andy Warhol’s famous painting, ’14 Small Electric Chairs,’ was tokenized and sold at auction. Over 800 bidders bought a 31.5% stake in the painting, which had a reserve price of US$4,000,000.

 

But who gets to hang it in their dining room and for how long?

I don’t think anyone is actually going to get the opportunity to have this piece hanging up on a wall in their home anytime soon, but what if this was not a painting but a luxury yacht. Not many of us can just go out and buy a luxury yacht, but what if twenty people wanted to and decided to buy one together?

It is possible to execute this type of transaction via smart contract on a blockchain. Twenty YCHT tokens could be issued, and each owner would receive one. They would have an immutable record of ownership that they could trade or sell to another party at any time. But the token would also show how much time that person would be able to have on the yacht. In fact, in an IoT kind of way, access to the boat could be restricted simply by not having the right blockchain-based digital ID credentials with you when you go to start the yacht’s engine. There’s plenty more that can be achieved with a smart contract, but you get the idea.

The same functionality can be used for cars, vacation homes, rental agreements, the list goes on, and there are plenty of companies out there trying to make these things happen right now, but I won’t go into those here.

 

Do We Want This?

Since most blockchains are decentralized and, therefore, have no central governing bodies to mess with the record as it suits them to, smart contracts that allow people to share ownership of an asset between them is an ideal solution. However, disputes could prove an issue.

Let’s say Owner 5’s three-year-old spilled apple juice all over the back seat of the shared car. Owner 7, the next car user, spots the damage and requests Owner 5 pay for cleaning. Owner 5 says that the spill had occurred before they got the car. What then?

One idea would be to have CCTV in the car so that the other owners can check back through the footage to see what really happened and to decide who should pay for what. But this is veering towards an Orwellian 1984-style totalitarian, panoptic mess that society should be aiming to avoid.

Smart contracts run on Ethereum, Bytom, Stellar, or any other capable blockchain certainly stand to make our lives simpler. However, smart contracts are still in their early days, and much work needs to be done with them before they can be deployed in fully mainstream applications.

#Ethereum

Ethereum is not a Security: SEC Chairman confirms Commission Staff Analysis

Published

on

Jay Clayton, the Chairman of the SEC and an American attorney gave confirmation on the Commission Staff’s Analysis that said that cryptocurrencies such as Ethereum are not securities.

 

Ethereum like tokens are not securities:

The SEC chairman has responded to a letter signed which was signed by Tedd Budd and several other colleagues after asking that whether the policy that would put forward last year by William Hinman, the director of the Divison of Corporate Finance should be regarded as the policy of the SEC or just a judgment of the Securities and Exchange Commission’s staff.

Jay Clayton responded to the letter by stating that he agrees to the statements of William Hinman that was made during the June 2018 speech that concern the digital tokens or cryptocurrencies. He said that he agrees that if a digital token is offered as security is not fixed (static). It might be offered first as security as it might meet the definition of an instrument contract, however, the position might change over time if the digital token is offered in a manner that does not represent that definition anymore. He agreed with William Hinman’s clarification about how the digital token might not represent the definition of an instrument contract.

 

The response letter by SEC Chairman Jay Clayton:

jay-clayton-response-1

jay-clayton-response-2

 

jay-clayton-response-3

 

Continue Reading

#Ethereum

2100 Ethereum accidentally sent as fee: Mining Pool returns half

Published

on

A user had accidentally sent 2100 Ethereum as a transaction fee which was verified by Sparkpool. Sparkpool asked the user to verify himself.

A user had accidentally sent 2100 Ethereum as a transaction fee which was verified by Sparkpool. According to Sparkpool, they on 25th February, they received an email claiming that the user had mistakenly sent 2100 Ethereum as mining fee on 19th February which was more than $300,000.

 

What happened next?

Sparkpool was generous enough to reply to the email asking the user to verify himself as the owner of the ethereum account from which the transaction was made. Sparkpool asked the user to send 0.022517 ETH on the mining pool’s ethereum address from the same address (0x587ecf600d304f831201c30ea0845118dd57516e) from which the transaction was made.

According to what Sparkpool asked him to do, the user sent the same amount of ETH (0.022517) to Sparkpool’s address on the same day to confirm his identity as the owner of the address. After confirmation, Sparkpool negotiated on the term that they are going to keep half of the amount of ETH i.e. 1050 ETH for the pool miners and the rest half they are going to return to the user.

The user sent another transaction to Sparkpool’s address to confirm the negotiation made by Sparkpool. This transaction was worth 0.666 ETH and also contained a coded paragraph in which the user thanked Sparkpool and their miners for helping them and that they are willing to share 1050 ETH with the miners after which Sparkpool returned 1050 ETH to the user.

Continue Reading

#Ethereum

Fall of Ethereum Mining Rewards: What has Constantinople hard fork changed?

Published

on

Ethereum went through the long-awaited Constantinople Hard Fork which increased the energy efficiency and reduced the Ethereum mining reward.

After continuous delays, Ethereum, at last, went through the long-awaited Constantinople Hard Fork which apart from increasing the energy efficiency of Ethereum mining, also reduced the Ethereum mining reward from 3 ETH to 2 ETH.

Ethereum Difficulty Bomb:

Ethereum network currently runs by Ethereum mining which involves a lot of miners approving the transactions on the blockchain. However, the future motive of Ethereum is to shift from the current Proof-of-work model to a Proof-of-stake model which does not involve mining. In order to stop the miners from backing out in case of a fork, Ethereum has included a ‘difficulty bomb’ which is a tool that will allow the ethereum mining difficulty to rise massively and discourage the miners so that they automatically shift over to the new Proof-of-stake model.

 

Are Miners interested in Proof-of-stake model?

It is quite obvious that ethereum miners are not interested in the proof-of-stake. However, the investors have been patiently waiting for ethereum to turn into a Proof-of-stake model from a long time as this would lead to the reduction in the inflation rate of Ethereum and eventually the price might rise.

Let’s look at the charts and see how the difficulty, block time and hashrate has been affected by Ethereum’s Constantinople hard fork:

 

Average Ethereum Mining Difficulty:

Ethereum-Difficulty-Chart-and-Difficulty-History-Chart-CoinWarz

Source: Coinwarz.com

The average Ethereum mining difficulty chart shows that due to the hardfork that happened on the 1st of March, the difficulty has tremendously decreased which indicates that the decrease in ethereum mining rewards is in relation to the ethereum mining difficulty.

 

Average Block Time of the Ethereum Network:

Average-block-time

Source: Etherscan.io

After the Constantinople hard fork, the block time of the ethereum network was also reduced from more than 19 seconds before the hard fork to around 13 seconds after the hard fork which is around 30% decrease. The chart shows that the reduction in the ethereum mining rewards also lowered down the block time apart from lowering the ethereum mining difficulty. As both the ethereum mining rewards as well as the block time has decreased, the Constantinople hard fork has not affected the ethereum miners much because as the ethereum mining rewards have decreased so the miners are paid less per block, however, the block time has also decreased which means that the miners can now mine more blocks in less time which compensates their mining rewards.

 

Average Hashrate of the Ethereum Network:

average-hash-rate

Source: Etherscan.io

The chart shows that after the Constantinople hard fork, The Ethereum Network hashrate hasn’t changed. However, this is not what was being expected by everyone. As the mining difficulty and block time would drop after the hard fork, it was expected that the hashrate would increase drastically as because the performance should be more in case the ethereum mining difficulty is less.

 

Why the Hashrate remained unchanged?

One of the reasons for the unchanged hashrate could be the increase in the price of Ethereum after the Constantinople hard fork. This led to the miners having bullish predictions about the price of ethereum although the mining rewards decreased.

Continue Reading

Keep up with Bitcoin & Blockchain Technology Trends

Simply enter your email address in the box below and sign up for emails from Coinnounce regarding trending cryptocurrency, bitcoin & blockchain topics and offers.

This information will never be shared with third parties.