Homestead Release: Importance and Updates

There are only four days left until the announced homestead release. As BTC-Echo already reported on 29 February 2016, the so-called Pi-Day (Pi = 3.14 and thus represents the American date spelling for this day) will be the next big development phase of the Ethereum protocol.

Which phases will follow the Bitcoin secret?

The new vertical takeoff among the crypto currencies is gradually gaining greater media interest. For many, it has been completely unrecognized in the last two months by the longer known Bitcoin secret currencies such as Litecoin or Ripplecoin. Today, BTC-Echo offered an analysis of the status and development of the Ethereum Prize in calendar week 10.

So far there has hardly been a “habituation period” for observers and those involved in crypto currencies, only insiders and enthusiasts have followed the Ethereum development for a long time, but such an intensive development was not expected from them either. Recently the technology giant Microsoft is interested in the service and supports it by implementing it in its own services.

All existing clients should be updated for the transition from the Frontier to the Homestead phase. The following two links provide the latest version of the local Ethereum Wallet “Mist Browser” and the currently most stable Miner “Aleth One”:

Ethereum Wallet

Linux 32-bit
Linux 64-bit
Mac OS-X
Windows 64-bit
Aleth One Miner

Windows installer
OS X Yosemite (10.10)
Instructions for the installation on Ubuntu can be found here
Attention: The clients should be updated before the 14.03. Clients that still have an old version might not be usable anymore.

Increased interest in cryptosoft

Google is also registering a growing interest of its users in cryptosoft. This Google trend shows an explosive growth of search queries for the term “cryptosoft” over time. Distribution of search queries on the term “Ethereum” over time. Source: Distribution of search queries for the term “Ethereum” over time. The top countries behind the search queries are sorted as shown in the following picture.

Why the Homestead release is so important
There are many good ideas, the difficulty lies in their implementation. Vitalik Buterin’s Ethereum promised a lot right from the start, from Smart Contracts (see Slock.IT interview by BTC-Echo) to Decentralised Autonomous Organisations (DAO) and the first Internet as originally planned: without censorship, without downtime and a decentralised structure.

As previously reported, the crossed out “safe” was removed from the website, meaning that the project has overcome the first hurdles, the Frontier network is shut down and the transition to the Homestead network begins. The alarming warning that Ethereum is at an experimental stage with major risks is shut down. While the homestead release is still seen as a beta stage, the question of “whether” something is working is more fundamental than the “how” that is now gradually being implemented.

If one imagines all phases as a construction project, the “construction” of the Ethereum network begins with the development, levelling and concreting of the property (Frontier). With the transition to the homestead phase, the house is built, the connections are made and all important precautions for the future are taken. This is often referred to as changes to make future upgrades easier.

Metropolis will appear next to Homestead. Metropolis will provide a full-featured interface for less technically savvy users and will include network support services such as a DApp Store.

With Serenity there will be a change in the calculations of the network. Ethereum’s team fears that the resource-guzzling proof-of-work will have to be converted to proof-of-stake, as much of the computing power will be transformed into heat.

But this step is not expected until 2017, the transition to the “secure functioning of the network”, the homestead, will be on 14.03 (Pi Day). BTC-Echo will report.

Helen Orton: “Fusion LenderComm for fast and efficient credit management”

Finastra was founded in 2017 through the merger of Misys and D+H and offers the world’s most comprehensive financial software portfolio. This includes solutions for retail and corporate banking, transaction banking, investment banking, credit, treasury and capital markets. Finastra Software customers can use the software in their own data centre or as a cloud based solution. We met Senior Principal Product Manager Helen Orton for an interview and talked to her about the LenderComm blockchain platform.

For all readers who still don’t know what exactly is cryptosoft?

Syndicated lending is a form of cryptosoft in which two or more lenders jointly provide loans to one or more borrowers. It is used, for example, for high credit volumes or for risk diversification like shown here: onlinebetrug.de. The lead intermediary bank is responsible for all administrative tasks. This can be extremely cost-intensive and time-consuming, especially for many participants. So far, the intermediary banks have spent a large part of their time communicating and coordinating such a loan. It was clear to us at Finastra that there had to be a better solution that would enable much faster and, above all, more efficient credit management.

In short, what is the goal of Fusion LenderComm?
Fusion LenderComm is a state-of-the-art, blockchain-based platform that simplifies the exchange of information in the syndicated lending sector. It also serves to make the syndicated lending market more transparent and effective than ever and ultimately to increase liquidity. The platform networks lead banks and lenders, giving them a personalized, real-time view of data from multiple intermediary banks. In this way, information on loan agreements, provisions and positions as well as integrated transaction data is available. Our goal is to significantly reduce the costs, operational burdens and risks for lenders and intermediaries.

And what is the challenge facing crypto trader?

Intermediary banks and lenders in the syndicated loan market often still rely on traditional, labor-intensive and manually operated technologies such as fax, email and telephone or this: https://www.forexaktuell.com/en/crypto-trader-scam/. They use these to exchange critical contract information between thousands of players involved in the financing, brokerage, monitoring and trading of syndicated loans. Such an approach places a burden on market crypto trader with extremely slow and inefficient processes. Fusion LenderComm standardizes and automates information exchange processes that previously took place manually. With Fusion LenderComm, we have created a platform on which all credit information can be accessed at any time in a structured and transparent manner. Participating intermediary banks can create contract data tailored to lenders using their own credit software, which they then publish and merge via Fusion LenderComm. Lenders can access this data independently in self-service and gain a real-time overview of their balance sheet items.

How do you define the term “blockchain”?
The blockchain is the well-known buzzword of the new technology, but we rely on the distributed ledger technology on which it is based for our solution. The attraction of this form of data processing lies in the fact that several participants can work together in different locations. Each participant has an identical copy of the database. The entered data is secured by cryptographic signatures, and a mechanism synchronizes it automatically. In addition to transparency, the decentralized network guarantees extremely high data and manipulation security. Access to the data is set up in such a way that each lender can only view his own data.

BTC-ECHO at the Bitcoin & Blockchain Conference in Malta

BTC-ECHO has travelled to Malta for you to attend and report at the Bitcoin & Blockchain Conference in Valletta. The internationally attended conference is one of the Bitcoin & Blockchain series of events organised by Smile Expo around the world. On the fringes of the event, we have also come to take a closer look at Malta as a location.

Even though the organizers and speakers as well as the audience were all mixed up, a strong Maltese influence could already be felt in the course of the event. The Maltese point of view dominated both the speakers and the topics of the day.

Nevertheless, the Bitcoin revolution was internationally oriented

After Silvio Schembri, the Maltese Parliamentary Secretary of State for Financial Services, Digital Economy and Innovation at the Prime Minister of Malta, had introduced the event, the content started immediately as seen in this review. Loui Mercieca, the Maltese software architect of the start-up Agilis, presented the basic technical functions of the Ethereum blockchain in order to raise the minimum level of knowledge of the audience to a Bitcoin revolution uniform level. This understanding formed the basis for the rest of the day, as the focus of the presentations that followed was on projects based on different applications of Ethereum.

Overall, the event had a focus on investments. For example, there was an Exhibition Area in the entrance area of the hotel where the event was scheduled, and a pitch session to present projects that could plan an ICO in the near future or already offer the prospect of a token sale. In addition, there were two larger panel rounds dealing with questions of the regulation of blockchain projects in general and of ICOs in particular.

Bitcoin loophole & Blockchain Conference in Valletta

Also a focus on investing in crypto currencies and Bitcoin loophole were various presentations by start-ups and investors on selected areas such as digital assets, margin lending or ICO launches. Here is the review about it.

However, the entire event did not deal with the topic of investment. For example, Fintech and AI expert Abdalla Kablan introduced the topic of Artificial Intelligence and established links to the Blockchain. Max Krupyshev, COO at Cubits, also explained how blockchain technology has changed in the years since the advent of Bitcoin and what effects this has on the entire area of application. A final panel also dealt with the risks that crypto currency trading entails under the EU Anti-Money Laundering Directive and what solutions could be presented in this area. In particular, the Know-Your-Customer-Principle (KYC) – already applied in Japan – was addressed, which should lead to a higher level of customer and investor protection.

During our visit to the event, we were also able to explore Malta as a European hot spot for blockchain applications and crypto currencies. Since the beginning of the year, the state has been working on a long-term national blockchain strategy. This is intended to highlight the use of the possibilities of blockchain technology for government use. In addition, a new legal framework is to be created which will further develop Malta towards a blockchain ecosystem. Prime Minister Joseph Muscat has repeatedly stressed the importance of digital currencies and called for them to be tested at state and EU level.

What is actually behind Lisk? Max Kordek and the sidechains

As useful as the Bitcoin blockchain may be, there is still room for improvement – at least for the time being. Although it is designed for decentralization, it is limited to a single strand. For the development of apps it is therefore only suitable to a limited extent – Lisk wants to remedy this.

Entering the crypto-universe in the Bitcoin loophole review

Max Kordek, born 91 in Aachen, is co-founder of Lisk and Lightcurve. As he once told us in an interview, he always wanted to do something in the fields of electrical engineering, information technology or investment. After he had tried electrical engineering from 2011 to 2015, he successfully broke off and found the connection between his Bitcoin loophole review preferred fields of employment in the blockchain.

Kordek undertook the walking attempts in mining. Since the competition in the Bitcoin environment was too great, he started mining Litecoin. Because the mining process is quite loud and heated, he looked for alternatives. After a short detour via NXT, Kordek came to Crypti.

The basic idea that would later make Lisk successful was already there. The goal of the community was to develop decentralized apps, dApps for short, on sidechains. Afterwards he was responsible at Crypti for marketing, growth hacking, community support, support, frontend development, design, user experience and idea conception.

From Crypti to the news spy scam

Although Kordek was convinced of the Cryptis concept – he was not satisfied. Together with Olivier Beddows he suggested some changes which were only partially accepted by the community. According to the blog post seen here at onlinebetrug, this was mainly about the disclosure of the source code as well as some personnel changes. Unsatisfied with the status quo of the news spy scam project, Kordek and Beddows decided to start their own project.

It is obvious that this led to distortions with members of Crypti. Nevertheless, Kordek and Beddows tried to make their departure as smooth as possible. They accepted Crypti for the ICO of their new project, although they considered it dead capital. Finally they forched Crypti and Lisk entered the crypto ecosystem.

The two then reworked the software, updated it and redesigned the whole thing. Combined with clever marketing on all channels, this marked the beginning of Lisk’s triumphal march. So it was above all the social media campaigns that pushed the project. There were rewards for followers on Facebook and Twitter, and incentives to participate were created as far as possible. After all, they hired a law firm for legal protection – Kordek apparently did everything right.

The idea of sidechains
First of all, Lisk is a crypto currency with its own blockchain. On the other hand – and this is much more important – Lisk forms a framework network for decentralized applications.

The dApps can be developed by any user. They run on so-called sidechains, parallel to the main blockchain. The mainchain serves as the memory on which the apps are registered – however, the apps are independent of the mainchain. Tokens that are intended for payment can then be moved back and forth between the sidechain and the mainchain. The special thing about it: This autonomy of the apps protects the rest of the network against possible attacks. The system is based on JavaScript.

The delegated Proof of Stake
The developers use a special consensus procedure to verify transactions. The Delegated Proof of Stake is a modification of the proof-of-stake mechanism. Stakeholders decide on the “delegates” who validate the blocks within the system.

Furthermore, the platform is designed to allow developers to participate directly in possible profits. So if you develop an app for selling goods, you can immediately program it to benefit from the sale. A separate currency was necessary to make (micro)transactions possible on the app.

Lisk is one of Germany’s success stories
This well thought-out concept ultimately convinced many investors. After the conclusion of the ICO on 21 March 2016, the developers were able to collect 14,009 BTC and 80 million XCR from a total of almost 3,900 supporters. A sum (at that time equivalent to about five million euros) for which forking was certainly worthwhile. If you want to see Max in color, you can do that in our video interview.

“I think it’s great that in Germany – illustrated by the success of BTC-ECHO – there is so much interest in blockchain technology. This gives me hope that this time we won’t miss the big chance, as we did in the 90s with the advent of the Internet and that our country will have a new Inno

How to Simulate Future Price Developments

In addition to the fundamental analysis, which aims to find the real value of an asset independently of its market value, and the technical analysis, the aim of which is to determine future market sentiment, there is a third position for valuing market prices. The efficient market hypothesis is based on the assumption that the current market price of an investment is always the correct one, i.e. that the fundamental value or any market sentiment has already been priced in. A radical interpretation of the efficient market hypothesis therefore takes the view that the market is unbeatable.

Brownian movement

Even though this third position has been criticized by various sides, it is a good basis for the estimation of long-term developments – here it is true that the market cannot really be estimated on such a long-term basis. This is why statistical methods are used. The basis of the analysis is a so-called random walk model. Here, a random course of the price is calculated. Such approaches have already been tested for Bitcoin and other Altcoins. It also served as an inspiration aid for the specially developed application mentioned above.

For a meaningful estimation it is considered how high the volatility was in the past and where the market has moved overall. The so-called geometric Brownian movement, which can be described in the following sentence, is often used for this purpose: In a Brownian movement, a next step in a random process depends only on the most recent previous values.

Formula friends would express the proposition as follows:

ΔP = P* (µΔt + σϵ(Δt)^0.5)

P is the price, µ is an expected increase (the so-called return), σ is its volatility (which corresponds to the standard deviation of the return), ϵ is a pure random variable and Δt is time. A price change ΔP is thus dependent on time, the old price, a drift and a volatility.

That’s enough theory for now, let’s start applying it! We consider the price development of Bitcoin as a classic example:

The chart shows the Bitcoin price development between 2012 and 2018. In order to be able to study as much of the development as possible, a logarithmic application was chosen. Some important variables can be determined from this price movement:

Return = log (price(t)/price(t-1))
Close = Course(today)
σ(day) = standard deviation(return)
Daily drift = average (Return)

Return is the profit made every day

Close is Bitcoin’s price today, which will also be the basis for further simulations. The standard deviation is the dispersion of the profit and a measure of the volatility of this investment. Finally, the drift is the mean value of the daily profits made. With the help of these variables and the formula given above, the price movement of Bitoin can be simulated over a period of one year. Since ϵ is a random variable (where the term Random Walk comes from), each simulation calculates a different possible future. To illustrate this, three simulated price curves are shown:

We see that the same formula can generate extremely different price curves using the random element ϵ . Running through a simulation will apparently say little about future price trends. Is it possible to say how a large part of the simulations will behave?

Monte Carlo – it doesn’t have to be just a simulation
We are a bit insane in favour of good statistics and carry out a million simulations. We orientate ourselves on Monte Carlo processes. Admittedly, these are not as complete as the above price trends, since we are only concerned with the question of how Bitcoin will develop in one year. To calculate this, we will upscale the parameters drift and volatility to 365 days:

Drift per year = Daily drift * 365
Volatility per year = σ(day)*365^0.5

With this annual drift and volatility, the following formula can now be applied:

P(year) = Close*exp((drift per year-0.5*volatility per year^2)+volatility per year*ϵ)

If this is now calculated several times, a histogram can give us information about how often which prices were calculated at the end of a year. A logarithmic representation of the histogram was chosen so that the wide range of calculated final prices can be viewed:

We see that most simulations calculate a price of 17,078 US dollars after one year. We also see that the distribution is normally distributed in a logarithmic representation. This lets us say something more: we can look at the standard deviation around this mean. This is quite an interesting measure, since it is known that 68% of the results described by a normal distribution are within this standard deviation.

Thus