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Ex-Bitmain CEO Jihan Wu Set to Launch Crypto OTC Platform Next Month: Report

Speculation remains over whether Jihan Wu will serve as chairman or CEO of Matrix, the upcoming crypto services startup.

Ex-Bitmain CEO Jihan Wu could launch his newest venture next month, according to a report by The Block on June 5.

One unnamed source told the website that the crypto services startup, called Matrix, “will be the biggest over-the-counter (OTC) desk and asset manager overnight.”

Matrix’s OTC offering is likely to be boosted by its close ties to bitcoin (BTC) mining company, Bitmain. The new business will reportedly offer custody and lending services to the Beijing-based giant, receiving a liquid pool in return.

Another of the four unnamed sources told The Block that such high levels of liquidity could result in lower crypto prices, giving Matrix a competitive advantage in Asia.

The Block notes that speculation remains over whether Wu will serve as chairman or CEO of the new company — as well as over whether Matrix would be allowed to operate in China, which has a history of clamping down on the cryptocurrency industry and crypto trading.

Last November, Wu was reportedly demoted from being a “director” at Bitmain to a “supervisor.”

Bitmain is one of the biggest players in the cryptocurrency industry due to its huge mining capabilities, and Wu continues to hold a 20.5% stake in the business.

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SBI President: “I was About to Promote Bitcoin Cash but Bitcoin ABC and SV happened”

Bitcoin Cash

The president of Japanese financial giants, SBI, Yoshitaka Kitao has revealed that he intended to promote Bitcoin Cash. However, he did not proceed with the plan due to a contentious hard fork that split the Bitcoin Cash into Bitcoin ABC and Bitcoin SV. He was candid admitting that “he is not a fan of cryptocurrencies that regularly forks”.

In the discussion, Kitao says:

 “Coins that frequently hard fork are ridiculous. I was going to promote BCH, but Jihan and Craig ended up fighting, and ABC and SV were born. Jihan side won and inherited the name BCH, but I decided to quit both. This caused the market cap for both coins to fall.”

Yoshitaka was straight forward, saying that he would have promoted the coin before Nov-2018 hard fork but the rift between Jihan Wu–the former CEO of Bitmain, and Craig Wright, the self-proclaimed Satoshi Nakamoto, changed his mind. With the misunderstanding between the two leading to the creation of Bitcoin SV, Kitao said he decided to quit both coins. And he was right, because after the split, the space went on a death spiral with Bitcoin Cash sinking 50 percent and at some point trading at parity with Bitcoin SV.

So far, the controversy surrounding Craig Wright and Calvin Ayre has seen Bitcoin SV removed from some cryptocurrency exchanges like Kraken, Binance, and ShapeShift. Nonetheless, Craig Wright continues to claim he is the real Satoshi Nakamoto, the anonymous inventor of Bitcoin–who for some reason John McAfee says he can out him. Even though he is adamant, he is yet to provide evidence to support his assertion and because of this he is often labelled a fraud–or faketoshi.

SBI Role in Crypto

SBI Holdings is a big crypto player, driving adoption in Japan, a country that is open towards technology, protecting consumers but at the same time drawing revenue from an industry projected to print multi-trillion capitalization in the next few years. Yoshitaka is the brains behind SBI Holding and after forming the firm in 1999, the company delved into crypto and in June last year, launched its cryptocurrency exchange dubbed VCTrade.

Even so, SBI is an ardent supporter of Ripple (XRP) as they believe that its large customer base across the globe would accept XRP with Ripple bridging the gap between financial institutions and blockchain companies. To that end, SBI leverages Ripple’s technologies and XRP to carry out cross-border transactions at a faster and cheaper rate.

Last month, the company revealed that it has put together a new subsidiary that would manufacture crypto mining chips and systems. The firm called SBI Mining Chip Co. (SBIMC) is part of the company’s efforts to boost its digital-related ventures.

The post SBI President: “I was About to Promote Bitcoin Cash but Bitcoin ABC and SV happened” appeared first on Ethereum World News.

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Rumor: Jihan Wu and the Jenke Group to Retire as CEOs of Bitmain

With the New Year only hours away, news reaching Ethereum World News indicate that the giant Bitcoin mining and ASIC manufacturing company of Bitmain might be undergoing some radical top management changes. According to reports by both Cointelegraph and Odaily, Jihan Wu and the Jenke Group will soon be retiring as CEOs of the company.

Odaily went to name a single successor with a surname of Wang. The report went on to state that Bitmain is in a transitory period as the changes are implemented.

Earlier Reports of Jihan Wu Losing Executive Power at Bitmain

The unconfirmed reports of major changes at the top leadership at Bitmain come a month after similar rumors surfaced that Bitmain had undergone a massive board reshuffle. In the restructuring, Jihan Wu had lost his seat as the board’s executive director and was now serving as a supervisor. His position at Bitmain had been replaced by Zhan Ketuan.

Possible Shut Down of Mining Operations at the Mining Giant

Odaily went on to add that the firm could also wind down all mining operations carried out by Bitmain. In addition, the firm will sell all its currently operational Antminer S9s. Once again, we would like to remind our readers that this are unconfirmed reports.

Layoffs Already Underway

Only one week ago, Ethereum World News had indicated that Bitmain was laying off up to 50% of its staff as part of streamlining operations due to the cryptocurrency bear market. With a staff count of over 2,000, the Bitmain layoffs might shake the crypto-verse further if they are accompanied by the aforementioned ceasing of mining activities. Such an event would shift the balance of mining operations and open the doors for a reentry of small scale miners into the BTC network.

A Continual Domino Effect

Earlier on in the month, we had analyzed why the Bitmain IPO would probably not be approved by the Hong Kong Stock Exchange (HKEX). A summary as to why the HKEX would be reluctant to list Bitmain is as follows.

  • $740 Million in Q3 losses excluding cost of financing Hash Wars
  • $10 Million in combined costs from both BCH camps for financing the hash wars
  • Bitmain allegedly liquidating its stash of BCH to pay off supplier debts
  • Lawsuit against Bitmain and BCHABC supporters for allegedly hijacking the BCH blockchain
  • Earlier rumors of Jihan Wu losing Executive powers at Bitmain

Conclusion

Summing it up, the rumors indicating that Bitmain might be in financial trouble have continued to pile up from around the third quarter of 2018. What remains, is official confirmation from Bitmain that all is not well at the ASIC (Application Specific Integrated Circuit) chip manufacturer and crypto mining company.

What are your thoughts on the unconfirmed reports that Jihan Wu and the Jenke Group will be resigning as Bitmain’s COEs? Please let us know in the comment section below. 

Disclaimer: This article is not meant to give financial advice. Any additional opinion herein is purely the author’s and does not represent the opinion of Ethereum World News or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.

The post Rumor: Jihan Wu and the Jenke Group to Retire as CEOs of Bitmain appeared first on Ethereum World News.

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Is Bitcoin Cash (BCH) Losing Value Due to Bitmain’s Alleged Financial Woes?

The crypto community breathed a sigh of relief after the Bitcoin Cash (BCH) hash wars reportedly ended on the 23rd of November. The Hash Wars that had officially started on the 14th of the same month, were due to two factions of the BCH community not agreeing on which upgrade to implement. This then led to a bitter battle between one camp led by Craig Wright (Bitcoin SV) and another by Roger Ver and Jihan Wu. The two camps eventually settled to fork the BCH blockchain.

Mr. Wu is the current CEO of Bitmain which is a company that specializes in designing ASIC chips for Bitcoin mining. The company also operates two of the largest Bitcoin mining pools: BTC.com and Antpool.

Signs of Trouble at Bitmain

The initial signs of trouble at Bitmain started right before the Hash Wars when it was reported that Jihan Wu had lost his seat as the company’s board executive director after a board reshuffle. Jihun was reportedly replaced by Zhan Ketuan. The reason for the reshuffle was not explained but on the same day, 90,000 miners were hurriedly deployed in China’s far-western region of Xinjiang to mine Bitcoin Cash ABC – the current BCH.

After the Hash Wars were over, it was rumored that the Q3 financials of Bitmain indicated that the company had made losses amounting to $740 Million. This amount excluded the cost of financing the hash wars. The unconfirmed losses by the company has led many to speculate that the pending IPO is an exit strategy by execs at Bitmain.

According to research by a team at Bitmex, the joint loss by both camps due to the BCH hash wars could well have exceeded $10 Million. Bitmain has also closed down its Israeli Blockchain development center, citing crypto market conditions.

Pending Law Suit Against Bitmain

Soon after the hash wars, UnitedCorp launched a suit against Bitmain, Bitcoin.com, Roger Ver, Kraken Bitcoin Exchange and others, claiming they had hijacked the Bitcoin Cash Network after the November 15th hard-fork.

Rumors that Bitmain is Liquidating its BCH

Additional rumors circulating on Crypto Twitter indicate that Bitmain might be liquidating its BCH stash to pay off supplier debts totaling $600 Million. One such tweet can be found below.

The same twitter user was the one who informed the crypto community about the potential $740 Million in Q3 losses made by Bitmain. The user also had this to say in a recent tweet.

PREDICTION: Bitmain will finish the year with NEGATIVE $1,2-$1,5 BLN NET INCOME and cement its place as most money losing company in the industry #BitmainIPO @HKEXGroup

If the reports of Bitmain’s financial woes turn out to be true, it explains why Bitcoin Cash has continually fallen from the number 4 spot on coinmarketcap.com, to its current number 7 ranking. Before the hash wars, BCH was trading at around $500. The digital asset is now valued at $86 indicating a 83% drop in value in a period of one month. 

What are your thoughts on the drop in value of BCH? Could it be linked to the ‘troubles’ Bitmain is facing? Please let us know in the comment section below. 

[Image courtesy of stuff.co.nz]

Disclaimer: This article is not meant to give financial advice. Any additional opinion herein is purely the author’s and does not represent the opinion of Ethereum World News or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.

The post Is Bitcoin Cash (BCH) Losing Value Due to Bitmain’s Alleged Financial Woes? appeared first on Ethereum World News.

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Fortune Releases First-Ever Crypto-Focused '40 Under 40' Annual Rankings

For the first time, Fortune has created a crypto-focused version of its prestigious “40 under 40” honor roll for the most impressive young disruptors in the finance and technology industry, published July 23.

Dubbed “The Ledger 40 under 40,” the list is dedicated to innovators at the helm of the “financial revolution” ushered in by cryptocurrencies, blockchain, and other distributed ledger technologies.

Last week, five crypto industry representatives had already clinched four spots on Fortune’s existing “40 under 40” — all of whom reappear in the inaugural Ledger list.

These include the CEO of major U.S. crypto exchange and wallet service Coinbase, Brian Armstrong, 34, who is ranked first by the Ledger for “catapulting” crypto into the mainstream. “Skinny visionary” Ethereum (ETH) co-founder Vitalik Buterin, 24, has been thrice-celebrated on Fortune’s established list and now seals the second spot on the Ledger list.

In third place is Jihan Wu, 32, the co-founder of Beijing-based mining hardware titan Bitmain — reportedly now valued at $12 billion after a recent round of funding. Fortune notes Wu’s support for the “controversial” Bitcoin (BTC) fork, Bitcoin Cash (BCH), as well as his interest in stablecoins and aspiration to develop artificial intelligence (AI) mining chips.

The list includes figures who have decamped from the traditional financial sector to become crypto industry front runners, alongside those who aim to lead the “revolution from within.”

Amber Baldet, 35, former blockchain program lead at JPMorgan Chase, is ranked eleventh for co-founding blockchain startup Clovyr, her former position as lead developer of Quorum, and her recent appointment to the board of the Zcash Foundation — the nonprofit that governs anonymity-oriented altcoin Zcash (ZEC).

Christine Moy, Baldet’s successor at JPMorgan’s blockchain program, is ranked 18th, and in the sixth and 20th spots are Goldman Sachs’ Rana Yared, 34, and Justin Schmidt, 38, for spearheading the Wall Street giant’s future Bitcoin trading operation.

The list’s crypto stalwarts include the Bitcoin billionaire Winklevoss twins, 36, (eighth) and Bitcoin Cash “evangelist” Roger Ver, 39, (36th), as well as “serial” cryptosphere innovator and now Block.one CTO Dan Larimer, 36, (12th) and Bitstamp’s CEO and co-founder Nejc Kodrič, 29, (29th) — hailed as a garage-born passion project that became Europe’s first licensed Bitcoin trading platform.

Prior to this week’s full-fledged crypto incarnation, Cointelegraph has followed the burgeoning representation of industry pioneers in Fortune’s 2017 and 2018 established rankings.

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Mining Giant Bitmain’s CEO Wu ‘Open’ to Hong Kong IPO, Report Says

The CEO of crypto mining hardware giant Bitmain, Jihan Wu, has confirmed he is “open” to conducting an overseas initial public offering (IPO), Bloomberg reports today, June 7.

Speaking in an interview in Hong Kong, Wu, who claims to own up to 28 percent of China-headquartered Bitmain, said an IPO in the region –  or any market which U.S. dollar-denominated shares – would be suitable  as a means of allowing early backers to cash in funds.

The potential move would mimic Canaan, one of the company’s main competitors, which announced its intention to launch an IPO last month.

Canaan occupies around 15 percent of the Bitcoin mining chip market, while Bitmain’s share is still easily the largest at 75 percent. “Bitmain is trying very hard to maintain its advantage,” Wu told Bloomberg.

Should it go ahead, the company could attract a significant valuation from Hong Kong investors due to first move advantage, Mizuho Securities Asia analyst Kevin Wang added to Bloomberg. “They’ll have a premium for their valuation because there are very few” other options, he said. “But the sustainability of the business is the question mark.”

Bitcoin mining remains an industrial-scale business attracting major costs. In May Cointelegraph reported on research that forecasts the crypto mining industry will consume 0.5% of the world’s total energy by the end of 2018.

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The Crypto 'Kill Switch': Monero Is Going to War Against Big Miners

Developers are preparing to go to lengths to keep one of the world’s largest cryptocurrencies free from the encroaching interests of big business.

While a high-speed hardware known as an ASIC has been used to secure bitcoin transactions for years, mining hardware manufacturer Bitmain recently announced a new model, the Antminer X3, that has been purpose-built for mining the privacy-oriented cryptocurrency monero.

Yet rather than greeting the hardware as a welcome sign of increased interest, monero will go so far as to enact an emergency software upgrade in April meant specifically to change the rules of the system so as to block the effort entirely.

Largely referred to as monero’s first move in a “war” against ASICs, the upcoming software upgrade will render the Antminer X3 ineffective. Not only that, but to keep hardware manufacturers from catching up, these algorithm edits are planned to continue with bi-annual networks upgrades.

Stepping back, the move is a defense of the mining made possible by monero’s current algorithm, Cryptonight, which can successfully mine monero on consumer-grade laptops. Faced with competition by highly efficient ASICs, the fear is affordable laptop mining would be silenced.

And that’s not a development developers are taking lightly.

“I will do everything in my power to help the community prevent the proliferation of centralization-inducing ASICs on the monero network,” core developer Riccardo “Fluffypony” Spagni declared on GitHub.

Currently issued by a sole supplier, Bitmain, concerns exist that the Antminer X3 could lead to certain kinds of attacks, namely ones in which a mining pool takes over the majority of a cryptocurrency’s hashrate, creating false transaction histories, double spending coins and censoring payments.

And while there’s debate that highly efficient ASICs are, by and large, good for security, many in the monero community are standing in opposition.

“If you’re worried about an attack from, say, someone using lots of Amazon servers to 51 percent the coin, then forking away from ASICs is a bad move,” core developer “moneromooo” told CoinDesk.

The developer continued:

“If you’re worried about an attack from someone like Bitmain, then not forking away from ASICs means you’re already pwned, since Bitmain will likely have 51 percent very, very soon.”

Bitmain doubts

Influencing the decision is, of course, the long-standing distrust between developers and Bitmain (as well as its co-CEO and principal figurehead Jihan Wu).

Last year, concerns were raised that Bitmain was secretly exploiting a weakness in bitcoin’s proof-of-work algorithm, through a process called ASICBoost, which supposedly enabled its three mining pools to mine roughly 20 percent faster than competitors. Not long after this controversy came the discovery of a mining chip vulnerability called Antbleed, which some believed Bitmain had implanted purposefully so it could forcibly shut down any of its miners at will.

Then, late last year, Bitmain produced an ASIC that was capable of mining siacoin, a small cryptocurrency, in a move that was widely regarded as a takeover.

All these things allowed monero creator Ricardo Spagni to defend his cryptocurrency’s ASIC-resistance on Twitter, writing, “Their actions with the bitcoin community and more recently the sia community are clearly those of a bad actor.”

But even without the concerns about Wu and Bitmain, enabling ASICs to be used to mine monero could potentially pose a bigger risk, since censorship-resistance is so key to its success, monero core developer “binaryFate” explained.

“Maybe even more so than for other cryptocurrencies, decentralization is key to monero for ensuring censorship resistance,” binaryFate said.

For instance, censorship would destroy a key promise of the private cryptocurrency – fungibility, or the ability to use one coin just as any other.

In an announcement, the monero team extrapolated on the risks of ASIC centralization, writing that until ASIC hardware is widespread, it is of high-security risk, including the potential of government bribery or even the introduction of a “kill switch” that could shut down miners remotely.

The blog post states:

“This threat has the potential to destroy the whole network.”

Critics of Cryptonight

As such, monero will continue to fight against the hardware.

“I believe this has set a precedent that we are serious about ASIC resistance, can react quickly if we are forced to and do not mind manufacturers losing money,” BinaryFate said. “In the foreseeable future, I doubt any ASIC manufacturer will want to give a try at monero again.”

However, the move has shown to be divisive as well, primarily because monero’s proof-of-work algorithm is not without its critics. While it’s key to the cryptocurrency’s accessibility, others feel that the low barrier to entry lowers the cost of attack.

For one, a javascript implementation of the protocol, named Coinhive, was labeled the sixth most popular malware worldwide in a study by cybersecurity firm Check Point last November. Further, in February this year, the algorithm enacted botnet attacks to the scale of over half a million mining machines.

“In which a small-cap cryptocurrency desperately tries to destroy their security by fighting actively against economies of scale,” Philip Daian, an ethereum researcher, wrote on Twitter, about the community’s moves to stop ASICs.

Echoing a similar sentiment, Andrew Poelstra, a mathematician at Blockstream, argued in a 2015 research paper that while anti-ASIC code can delay manufacturers, “ultimately ASIC resistance is futile.”

Plus, there are concerns that ongoing edits to the underlying algorithm could weaken the code, opening doors to vulnerabilities. Addressing this, developer “iamsmooth” suggested an “ASIC-friendly” approach, that would focus on lowering the cost and accessibility of the hardware.

In conversation with CoinDesk, even moneromooo agreed, stating that bi-annual edits “is a bit of a shitty method, so hopefully, a better algorithm can be found.”

But until then, Spagni and many others defend monero’s actions.

“This is a matter of choosing the lesser of two evils,” Spagni wrote on Github, weighing botnets against ASICs.

And ultimately, Spagni took to Twitter to say:

“It might entirely be less secure, but the community has made the hard call. I don’t decide anything, the community does.”

Red button image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Jihan Wu to Talk Central Bank Crypto at DC Blockchain Summit

Sparks, meet lighter fluid.

Jihan Wu, the controversial co-CEO of bitcoin mining hardware maker Bitmain, will discuss the idea of central bank digital currency in a speech Wednesday, a source told CoinDesk.

Wu is perhaps the most highly-anticipated speaker at the three-day D.C. Blockchain Summit, which kicked off on Tuesday with a developer event.

Named as one of CoinDesk’s Most Influential in Blockchain for 2017, Wu is at the head of the world’s largest provider of bitcoin mining hardware, which analysts have estimated made as much as $4 billion in profits last year, according to Fortune. Depending on who you ask, Wu is either Enemy Number One or, in the words of Roger Ver, someone who has “poured his life and soul into this for years.”

Wu’s chosen topic – central bank-issued digital currencies – is perhaps just as controversial. A number of institutions worldwide have looked at the question of a central bank using the tech that underlies bitcoin to further digitize their money. Yet despite support from quarters of the finance community, observers say that 2018 is unlikely to be the year that such a launch takes place.

DC set for summit

Wu’s appearance forms part of a wider event in D.C., which will see regulators, government officials, startups and business leaders converge to talk blockchain and cryptocurrency.

The conference is being organized by Digital Chamber of Commerce and Georgetown University’s Center for Financial Markets and Policy. In anticipation of the three-day event, the Chamber also released a white paper regarding intellectual property issues and blockchain.

Government officials are also among the notable attendees, including James Sullivan, the deputy assistant secretary for services at the International Trade Administration, which falls within the purview of the U.S. Department of Commerce.

Other officials scheduled to speak will be familiar faces to the crypto industry by now, including CFTC Commissioner Brian Quintenz and Representatives Emmer and Schweikert of the Congressional Blockchain Caucus, all of whom have previously weighed in on crypto regulation.

Washington, DC image via Shutterstock

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at news@coindesk.com.

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Bitcoin to Get Severely Forked in 2018

The fear and build up towards Aug. 1, 2017, and the creation of Bitcoin Cash which forked off the original chain was monumental. However, it was a damp squib for the future of Bitcoin as it actually spiked in value.

Since then, forks on Bitcoin have become almost as common as ICOs, and in fact, forks on the Bitcoin chain look to be the latest trend for 2018 as new companies look to cash in on the familiar Bitcoin name.

Already a forking mess

Bitcoin Cash is, of course, the most well known Bitcoin fork out there, sitting comfortably in the top five coins in terms of market cap. However, in 2017, there were 19 registered Bitcoin forks. Still, that pales in comparison to the 50 that are expected this year, according to Lex Sokolin, global director of fintech strategy at Autonomous Research.

That number could still rise further as there is even services out there that are providing rudimentary programming skills to launch a clone. This will of course have a big effect in the cryptocurrency market as hedge fund manager Ari Paul predicted in a tweet:

What the fork?

There are a number of reasons to fork off the Bitcoin Blockchain, some do it, in the case of Bitcoin Cash, to seemingly improve facets of the old coin, while others may have different motives. As George Kimionis, chief executive officer of Coinomi puts it:

“Unfortunately, most fork-based projects we see today are more of a sheer money grab. Looking back a few years from now we might realize that they were just mutations fostered by investors blinded by numerical price increases rather than honest attempts to contribute to the Blockchain ecosystem.”

Kimionis also sees a new phase in the ICO marketplace with the original hype simmered down somewhat. Forking adds a little edge to a new coin. And Rhett Creighton, who’s working on the upcoming Bitcoin Private fork, predicts:

“Bitcoin forks are kind of the new altcoin. We are going to see now a bunch of Bitcoin forks. And they are going to start replacing some of the top hundred altcoins.”

Danger to the vision

It is hard to see these minor forks, even the likes of Bitcoin Gold and Diamond which reached the news, really, truly, adding much to the Blockchain environment. Even Bitcoin Cash has been linked to a money making scheme for the likes of Jihan Wu and Roger Ver. The difference between trying to improve the Blockchain, and to make money off a name, is a very blurred line.