Payments Firm Backs ‘Crazy’ Offline Bitcoin Transactions Experiment

Romanian mobile payments provider Netopia mobilPay is now backing a proposal to leverage microSD cards to conduct offline bitcoin transactions.

from CoinDesk

Digital Currencies a Silver Lining in the Dark Cloud of Greece’s Economic Crisis


As the world watches nervously, Greece, under pressure from the European Central Bank, takes the serious step of imposing capital controls: Banks are closed, ATM withdrawals are limited and funds cannot be sent out of the country.

Capital controls will be in place at least until July 7 after Sunday’s citizens’ referendum that will ask Greeks if they want to remain in the European Union and accept their creditors’ terms.

Will Bitcoin benefit from the current crisis?

There’s lots of speculation that the rate of adoption of digital currencies may increase more rapidly as a result of the current crisis in Greece.

CNN makes the case noting:

“The world’s largest Bitcoin exchanges tell CNNMoney they’ve seen a surge of business from Greece.” and

“Ten times as many Greeks are registering to trade bitcoins on the German marketplace than usual, according to CEO Oliver Flaskaemper. Bitcoin trades from Greece have shot up 79% from their ten-week average on Bitstamp, the world’s third-largest exchange.”

In an article on CNBC , Brendan O’Connor, CEO of digital currency-specialists Genesis Global Trading says:

“(Bitcoin) had been middling around the $235-245 range for several months, and all of the sudden this crisis escalates and you’ve gotten yourself a nice 10-point pop…Greece was likely the only factor behind the digital currency’s upward momentum.”

Daniel Roberts, writing in Fortune Magazine, disagrees and makes the case that the small spike in the price of bitcoin would have happened anyway:

“There may be a growing global interest in purchasing bitcoin that is coinciding roughly with the Greek crisis — the currency’s 2013 mega-spike coincided with a similar financial crisis in Cyprus — but the hike this summer began before the situation grew so dire in Greece.”

Eli Dourado, a research fellow at the Mercatus Center at George Mason University says:

“I think we are seeing a boomlet in global demand as a hedge against any kind of uncertainty, not just [the uncertainty] in Greece. I think the value of the concept is being affirmed.”

As Bitcoin Magazine reported yesterday, there are indications that some Greeks have been buying up bitcoin for some time now.

For Greece’s European neighbors, particularly in Italy, Spain, Portugal and even France, there is growing anxiety about the effects of Greece defaulting on the euro and the subsequent impact on the value of the euro and their savings.

In the wake of such economic uncertainty, it would seem more likely that Europeans will be looking more closely at digital currencies as an alternative to fiat currency.

Capital Controls for Cyprus – So How Did That Work Out?

In 2013, Cyprus was near bankruptcy and the ECB and IMF had proposed a deal that would see banks in Cyprus lose substantial funds. These caused a run on the banks, and the government subsequently imposed capital controls.

This devastated Cyprus’s economy, and the controls remained in place for almost two years with the last restrictions lifted in April 2015.

In a recent article in Bloomberg Business, Katia Porzecanski says about imposing capital controls: “Unfortunately for Greece, history suggests it hardly ever works.”

“While dozens of countries from Mexico to Iceland and Thailand have imposed such measures since World War I to boost revenue, prop up currencies and hold down interest rates, the International Monetary Fund found that only those few with sound economies and strong institutions succeeded in slowing capital flight.” 

Some Bitcoiners weigh in on the crisis

When Andreas Antonopoulos was in Toronto earlier this year he told the audience:

“I often get asked why I don’t recommend Bitcoin as the answer to Greece’s economic problems. I tell them the citizens of Greece should have the choice to use both digital currencies and fiat currency. Bitcoin alone isn’t necessarily the answer but it can be part of the solution.”

Erik Voorhees, CEO of, sees a huge opportunity for bitcoin in the current crisis. In a series of tweets yesterday, using ChangeTip, Voorhees gave away $5 in bitcoin to people concerned about the future of the euro.

Roger Ver is also optimistic that bitcoin can only benefit from the current situation:

Traumatic as the current economic crisis is for Greece and Europe, this may be an unprecedented opportunity for bitcoin to “take it to the next level.” As the old saying goes: “When one door closes, another door opens,” and the open door may be a brighter future for digital currencies.

The post Digital Currencies a Silver Lining in the Dark Cloud of Greece’s Economic Crisis appeared first on Bitcoin Magazine.

from Bitcoin Magazine

The Fear of Capital Controls May be Spreading from Greece to Italy


Yesterday, Bitcoin Magazine reported that Greece had closed its banks and imposed capital controls to prevent financial chaos after the breakdown of bailout talks with its international creditors. The decision came at the end of a weekend that brought Greece closer to “Grexit” – the potential exit from the Eurozone and perhaps the European Union (EU) itself – and confronted Europe with a serious crisis.

Today, Jose Pagliery, the author of “Bitcoin – And the Future of Money,” reports on CNN Money that Greeks are rushing to bitcoin. The article includes testimonials from top bitcoin exchanges such as, Bitcurex, and China-based LakeBTC, stating that they are seeing a surge of business and inquiries from Greece.

This is, according to Pagliery, a pivotal moment.

“Bitcoin was created as an independent, computerized money in 2009 to provide a stark alternative to government-issued currency held at banks,” he says. “This could be its moment to shine.”

The introduction of capital controls is likely to push people, not only wealthy investors but also ordinary people, to the conclusion that governments and banks couldn’t be trusted with their hard-earned savings. They may then start looking for alternative ways to store their savings, out of reach of predatory central banks, and choose bitcoin as the best alternative.

With limited access to their bank account and no legal way to transfer money abroad, the Greeks are likely to experience difficulties in buying bitcoin at the moment. But while it’s late for the Greeks who waited until now to act, other less optimistic Greeks have been buying bitcoin for some time now.

In other countries, especially in neighboring European countries with troubled economies, it seems likely that people will begin to realize that the government can – and will – impose capital control and cut them from access to their savings if the economic situation worsens.

Based on real-time reports collected by The Wall Street Journal, Zero Hedge notes that the contagious fear of capital controls may already be spreading from Greece to neighboring Italy. Several Italian banks reportedly failed to start trading on Monday as fears over a Greek debt default induced many investors to shed peripheral stocks, including Italian, with banks suffering the most.

Sales orders on Italian stocks, in particular financial stocks, piled up before the market opening. At the start, the sales orders were so numerous that the system couldn’t manage to process them, something that often happens when specific news causes a sell-off on a stock.

Speaking to Italian daily La Stampa, University of Chicago economist Luigi Zingales noted that a psychological contagion could spread immediately to Italy, because the Italian economy is not growing. “The question is: Would [Italians] too think to withdraw their money from the banks or not?”

La Stampa also reports that “The Bitcoin fever rises in Greece,” and mentions the recent April Fool’s joke of Greek Finance Minister Varoufakis: “Greece Will Adopt the Bitcoin If Eurogroup Doesn’t Give Us a Deal.” La Stampa describes similar scenarios as “unlikely, but potentially disruptive for Western economic culture.”


Photo Mārtiņš Bruņenieks / CC BY-SA 3.0 Unported

The post The Fear of Capital Controls May be Spreading from Greece to Italy appeared first on Bitcoin Magazine.

from Bitcoin Magazine

Bitnet Partners with Computop to Offer Bitcoin Payments for Over 3000 Merchants


Bitnet, a bitcoin payments processor and the developer of the largest payment gateway (CyberSource, acquired by VISA) has entered into a strategic partnership with Computop, a leading payment service provider, to allow global merchants to accept bitcoin on Computop Paygate.

Since its launch, Bitnet has focused its services to provide an enterprise-grade digital commerce platform with security, reliability and scalability standards demanded by global businesses.

Through the Computop and Bitnet partnership, however, the multi-national bitcoin merchant processor is attempting to implement its technologies to allow businesses of any size to accept bitcoin in a simple, safe and secure manner.

Bitnet bitcoin processors will be integrated in Computop Paygate, which will allow merchants to expand their businesses globally without cross-border fees. Furthermore, with offices spread throughout California, Northern Ireland and Singapore, Bitnet will fund its merchants with any local currencies of their choice.

“We recognize that the bitcoin ecosystem is growing throughout the world and are excited to be the first European PSP to partner with Bitnet to enable merchants to accept payments in bitcoin,” said Ralf Gladis, CEO of Computop. “Through this partnership, retailers don’t have to worry about the management of this evolving payment method. They can simply accept bitcoin as payment from customers, and know that the process will be smooth and risk-free for them.”

Computop Paygate, the platform which will support the Bitnet integration, is a Payment Card Industry Data Security Standard-certified platform which offers service providers and merchants with secure and fraud-proof payment processors for international standards. Computop Paygate enables international retailers and merchants to access more than 60 payment methods, which include – MOTO, mobile payment solutions, PoS solutions, e-commerce, etc.

Computop Paygate is also supported by leading e-commerce solutions such as Demandware, hybris, Intershop, Magento, IBM Webspehere and SAP Business ByDesign, which all recommend Paygate as a preferred payment service service for international payment processing. Furthermore, Computop Paygate handles more than $100 million USD worth of transactions annually, and supports more than 3,000 internationally recognizable retailers, such as TSamsung, Fossil and C&A.

With its global support and extraordinarily large user base, Bitnet hopes to see a rapid increase of bitcoin-accepting merchants in Europe in the near future.

“Our partnership with Computop enables us to extend our bitcoin payments processing functionality to merchants globally,” said Akif Khan, chief commercial officer at Bitnet. “We look forward to working with Computop to enable merchants throughout Europe, the U.S. and Asia to accept bitcoin payments from their customers.”

Despite Bitnet’s partnership with one of Europe’s most popular payment processing platforms, it still has to compete against international bitcoin processors that have recently expanded services throughout Europe, including Netherlands-based bitcoin gateway BitPay, American bitcoin service provider Coinbase and bitcoin exchange/merchant platform Coinzone.


Photo Mobiles Bezahlen mit der Vodafone Wallet / Photopin

The post Bitnet Partners with Computop to Offer Bitcoin Payments for Over 3000 Merchants appeared first on Bitcoin Magazine.

from Bitcoin Magazine

BitGo Announces Launch of Solvency Proofs Verified by BitGo


BitGo announced today the release of its latest product offering, Verified by BitGo, a product that provides a real-time view of bitcoin assets owned by a company.

Whereas in the past, verification attempts were slow and often had security risk concerns, BitGo hopes that this will be a verification that allows it to publicly share all of its assets. Further, it will be able to cryptographically display that it is in a solvent state.

When dealing with brokerages and wallets, knowing that the provider is solvent can go a long way toward making a decision on using a service. This service will enable end users to analyze what the company’s assets are and compare that to its liabilities, even drilling down to ensure that the user’s own account is included in the total liabilities.

“We’re offering Verified by BitGo to selected partners as part of our unified platform offerings. The first step needed is to use a BitGo wallet for storing the business’ bitcoin,” Ben Davenport, CTO and co-founder of BitGo, said in an interview with Bitcoin Magazine. “It is not yet available for general self-service signup, but we’re interested in working with other Bitcoin businesses to help their security & transparency.”

ChangeTip the First to Use

 In the announcement, it was revealed that ChangeTip was the first business that would be using the Verified by BitGo service.

“Building trust is critical to expanding our user base within the Bitcoin community and beyond, and using BitGo to demonstrate our Proof of Reserves goes a long way to achieving it,” said ChangeTip CEO Nick Sullivan.

According to an email exchange with Bitcoin Magazine, Sullivan believes that, “having the Verified by BitGo logo gives users an extra sense of security.”

However, BitGo is opening up its operation to anyone who uses the BitGo platform offerings. As Davenport said in a statement, “Today we are launching our Verified by BitGo service, bringing the era of unverified funds to a close.”

It Could Have Prevented MtGox 

MtGox is the perfect example of a business that was operating in an insolvent state for a significant period of time. Users had no idea that the amount of bitcoin they believed existed on the exchange was far more than actually existed.

The team at BitGo believes that if Verified by BitGo had been around when MtGox was operating that its service would have been able to alert users far sooner to the problems at the exchange.

“Yes, we believe it could have,” Davenport said. “Based on the information that’s been made public, we believe MtGox was effectively operating in an insolvent state for a very long period. While a regular audit like this would not have eliminated the possibility of a business going insolvent, it should help detect it far sooner, dramatically reducing the magnitude of the ultimate losses.”

In an internal crisis management document that was leaked, it was revealed that the company had lost 744,408 bitcoin in a theft that had taken place years earlier. Had a service like Verified by BitGo been around, it is feasible that many users would not have continued putting their bitcoin onto the exchange.

“We are already working with several other companies interested in the product, but don’t have specific names to disclose yet,” Davenport told Bitcoin Magazine.

The post BitGo Announces Launch of Solvency Proofs Verified by BitGo appeared first on Bitcoin Magazine.

from Bitcoin Magazine