BTCNews.Today

Bitcoin changes our mental model and we can see it in a lot of people that get into Bitcoin. Many Bitcoiners start saving and not living paycheck to paycheck. Many start taking their lives more seriously and quit drinking alcohol and playing video games. Still others start investigating their diet and quit eating sugar, carbs, seed oils and other things they've been eating their whole lives. Some even get married and start having children. There are even some who start taking religion seriously. These results are pretty puzzling. What does a digital money have to do with any of these things?

LocalBitcoins has announced that the exchange will be closed for service by the end of February. The long-time Bitcoin trading service was the first peer-to-peer (P2P) transaction platform for many Bitcoiners. Launched in June 2012, the exchange is one of the oldest entities in Bitcoin, establishing itself as a primary P2P player in its hey-day with over $100 million in weekly trading volume of peer-to-peer transactions.Notably, the shutdown has arrived just as P2P Bitcoin merchants and individual sellers have come under heavy scrutiny from U.S. regulatory authorities.

Please tag @BTCNEWS_TODAY on Twitter to submit tweets.

lnurl-auth is very unique in the sense that it doesn’t even need a Lightning wallet to work, it is a standalone authentication protocol that can work anywhere. The basic idea is that each wallet has a seed, which is a random value (you may think of the BIP39 seed words, for example). Usually from that seed different keys are derived, each of these yielding a Bitcoin address, and also from that same seed may come the keys used to generate and manage Lightning channels. What lnurl-auth does is to generate a new key from that seed, and from that a new key for each service (identified by its domain) you try to authenticate with.

Regulators are effectively picking winners — with larger, more established crypto firms able to hang on to their bank relationships, while newer ones are shut out. Meanwhile, other jurisdictions are making a bid for their business. Hong Kong has adopted a friendlier tone once again, as has the UK. The UAE and the Saudis are looking to attract crypto firms. And US regulators can scarcely afford to forget what happened with FTX, in which they curtailed the business activities of onshore exchanges, effectively pushing US individuals into the waiting claws of SBF. If bank regulators continue their pressure campaign, they risk not only losing control of the crypto industry, but ironically increasing risk, by pushing activity to less sophisticated jurisdictions, less able to manage genuine risks that may emerge.

The inflated bitcoin prices may not reflect a heightened demand for the asset (bitcoin) but a continued demand for the U.S. dollar as the country’s local currency suffers. Nigeria’s bitcoin premiums are not a new phenomenon and they typically reveal the discrepancies between official and unofficial U.S. dollar exchange rates in the country. Although the government sets the official rate, thanks to the country’s chronic currency devaluation problem, the dollar sells for much higher on unofficial local forex markets.

Please tag @BTCNEWS_TODAY on Twitter to submit tweets.

It is reasonable to presume that in a situation where the bitcoin price continues its rally through 2023, capital will quickly flow to Bitcoin miners, thereby lifting hash rate and reducing miner unit revenue (a commonly-preferred metric for understanding unit revenue is “hash price”). The questions for miners is how likely such a BTC rally is and how long will it take for sufficient capital expenditures to be deployed, such that hash price reverts to its equilibrium. Many public miners are now more than 90% below their peaks and trade at valuations that attribute very little intrinsic value to their businesses. However, they remain highly volatile and have close correlations with the price of bitcoin.

This week’s newsletter summarizes a discussion about storing data in transaction witnesses and references a conversation about mitigating LN jamming. Also included are our regular sections with the summary of a Bitcoin Core PR Review Club meeting and descriptions of notable changes to popular Bitcoin infrastructure software. On the issue of storing data in transaction witnesses, Andrew Poelstra emphasizes that there is no effective way to prevent data storage. Adding new restrictions to prevent unwanted data storage in witnesses would undermine advantages discussed during taproot’s design and would likely only result in the data being stored in other ways. Those other ways might raise costs for those generating the data—but probably not by enough to significantly discourage the behavior—and the alternative storage methods might create new problems for traditional Bitcoin users.

India wants to launch its central bank digital currency at a national level by the end of 2023, but early into its pilot, the Reserve Bank of India has identified challenges, several people familiar with the matter said. The CBDC-R is meant for the private sector and Indian citizens. The wholesale CBDCs are restricted to financial institutions and are meant to improve the efficiency of interbank payments. Publicly, the RBI has said the CBDC will provide an additional option to the currently available forms of money that is easier, faster and cheaper to use than existing payment rails, along with the transactional benefits of other forms of digital money. Privately, as an emerging economy, one of the world’s largest populations in 2023, and the fifth largest in terms of GDP, India’s geopolitical motivation is to counter the dollarization of the global economy.

Please tag @BTCNEWS_TODAY on Twitter to submit tweets.

Governor Andrew Bailey and Chancellor Jeremy Hunt revealed a roadmap on Monday night for creating a new central bank digital currency (CBDC) – dubbed “Britcoin” in the press – that could enter circulation by the end of this decade. It is understood that Britons will initially be limited to transferring a few thousand “digital pounds” into their accounts under plans being drawn up. The limit will be imposed in order to prevent “large and rapid outflows” from traditional high street banks.“A limit on individuals’ holdings would apply at least in the introductory phase,” the Treasury said. “This would strike a balance between both encouraging use and managing risks, such as the potential for large and rapid outflows from banking deposits into digital pounds. These limits could be amended in the future.”

The prime objective of the programme is to use additional foreign exchange resources from the Bank of Ghana’s Domestic Gold Purchase programme to provide foreign currency for the importation of petroleum products for the country which currently stands at about USD350 million per month. The programme also aims to procure petroleum products at very competitive prices through Government-to-Government (G2G) arrangements.

Please tag @BTCNEWS_TODAY on Twitter to submit tweets.

Fedimint is an emerging open source protocol that combines bitcoin, lightning, chaumian ecash, and federated custodians (called Guardians) to create community wallets that are easy to use, have strong privacy, reduced custodial risk, cheap and fast payments within the community, and interoperability with all bitcoin wallets. Current Fedimint development is focused on easy to use consumer wallets that could replace usage of major custodial wallet providers such as Binance and Wallet of Satoshi, but what if the same tech was used to replace major custodial mining pools such as Foundry and AntPool.

There’s a new way to mint non-fungible tokens (NFTs) on Bitcoin, one that involves putting the actual content of the NFT completely on-chain. Only the creator of this standard, Casey Rodarmor, doesn’t want to call them NFTs. He thinks that the word is tainted, so instead he’s calling them “digital artifacts.” An ordinal is any number that defines a position in a series (e.g, first, second, third). In this case, the ordinal is the unspent transaction output (UTXO) for a specific satoshi. This satoshi includes an inscription with the NFT’s content, which could be txt, an image, an HTML, or even an MP3 file, and the ordinal marks this inscribed sat as a special transaction so users can identify and track them. Notably, an ordering system for sequencing satoshis was proposed as early as 2012. Since launching in January, over 1,000 digital artifacts are now immortalized on the Bitcoin blockchain.

By using data storage features of the Bitcoin network that were introduced by the Segregated Witness (SegWit) upgrade in 2017 and the Taproot upgrade in 2021, Bitcoin node operators are stuffing images, GIFs and other media files into Bitcoin blocks. But this practice has also resurfaced a conversation of growing importance: miner extractable value (MEV) on Bitcoin. Ordinals are Bitcoin data inscriptions that give miners a glimpse at what the future of Bitcoin MEV could be.

Munger is a Cantillionaire – after Richard Cantillion who wrote one of the first economic treatise in the eighteenth century describing how proximity to the monetary inputs of a society confer special advantages at the expense of wider populus. If there is such thing as “structural inequality”, it has more to do with the way the monetary system is constructed to benefit people who are already super-wealthy than anything else. Bitcoin is more than a disruptive technology. It’s a decentralized counter-attack against a structurally unsustainable and predatory financial system.

In Bitcoin the smallest error has the potential to be catastrophic; as such, those focused on private key security strive to eliminate any single point of failure in the systems they build. Naturally, this makes the concept of splitting up a secret into multiple pieces and later performing a ritual to recombine them sound somewhat appealing. It's so appealing that variations of Shamir's Secret Sharing (SSS) have been implemented several times in the cryptocurrency space, only for developers to later realize that the additional complexity ended up reducing the security of the system.

Please tag @BTCNEWS_TODAY on Twitter to submit tweets.

Traditional banking systems have, time and again, served as a tool for centralized governments to dictate financial access, especially during emergencies. A large portion of the general public sees Bitcoin as a gateway to financial freedom amid growing fiat inflation and geopolitical uncertainties. As intended by the creator Satoshi Nakamoto, Bitcoin seeks to bring power back to the people. No amount of regulations, sanctions or bans can stop people from using Bitcoin as money. Beyond that, a calculated investment in Bitcoin has the potential to bring people closer to attaining their dream of financial freedom.

Please tag @BTCNEWS_TODAY on Twitter to submit tweets.

It took two years for the Fed to deny Custodia’s application despite approval normally taking ten days. Only for it to grow fishier. Denial from an allegedly non-political entity came in concert with the Biden administration releasing a rather skeptical statement about cryptocurrencies: “Roadmap to Mitigate Cryptocurrencies’ Risks.” It gets more ridiculous. And obnoxious. The Fed is excusing its alleged caution about Custodia given the “significant risks associated with cryptoassets and the crypto-asset sector.” Oh dear. Can they be serious? Better yet, do the regulators at the Fed think anyone is fooled here?

What bitcoin’s strong January may imply for the rest of the year, Ordinals NFT project provokes important questions for Bitcoin community and FOMC's rate decision sends Bitcoin higher.

On Feb. 3, the Australian Treasury released a consultation paper on “token mapping,” announcing it as a foundational step in the government’s multistage reform agenda to regulate the market. The paper proposes its taxonomy of four types of crypto-related products: Crypto asset services, Intermediated crypto assets, Network tokens, Smart contracts. While the paper proposes to start the discussion on this taxonomy and doesn’t provide any legislative initiatives, its authors anticipate a relatively easy tailoring of existing laws for a large portion of the crypto ecosystem.