Monthly Archives: November 2018

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5 Reasons why you should think about Bitcoin as a retirement plan

The value of the Bitcoin has been rising steadily since the end of 2014 and has now exceeded its record high several times. In the following article, five reasons why the Bitcoin is becoming more attractive as an investment are examined in more detail. The successful developments have attracted more and more interested parties in recent months, so that conventional investors are also considering securing their investment with Bitcoin.

Daytraders and coin-enthusiasts are no longer the only people who deal with the Bitcoin and its positive aspects. Also investors, who consider a further value investment regarding their pension.

Bitcoin and Bitcoin loophole

Individual annuity accounts (IRAs) are options for Bitcoin loophole investors to provide for their annuity. The IRA offers some tax advantages. Some companies have added their accounts so that since 2016 citizens in the US have had the opportunity to receive pension payments in Bitcoin via Bitcoin IRA.

The investment Bitcoin is nevertheless very speculative. However, if the process continues and more and more companies accept Bitcoin, there is a good chance that the Bitcoin could rise to $100,000 within the next ten years. However, this requires a positive opinion of the general public regarding the topic of crypto currencies. Under these circumstances, the Bitcoin is moving closer in the direction of a possible investment.

Despite the high price volatility, more and more people are opting for this option and regard the Bitcoin as part of their investment portfolio. There are numerous reasons for this:

It changes the possibility of transactions
The concept of making payments online has been known for some time: Credit cards, PayPal, Payoneer and transaction services have been offering this convenient service for years. Nevertheless, the Bitcoin offers advantages because money can be sent across borders without any problems. In addition, the Bitcoin can be seen as a bridge between currencies. High security and fast processing are the aspirations of every person who wants to carry out transactions. In this respect, the Bitcoin was able to assert itself clearly against its rivals.

National regulations fail
Japan has also adopted Bitcoin as a legal form of payment. In addition, the Federal Reserve could neither regulate nor define the Bitcoin. The central banks have hardly any influence over the Bitcoin, which leads to increasing credibility and transparency in the area of crypto currencies.

Exceptional technology
The Bitcoin is called the „new gold“ of the virtual world. Eric Schmidt, CEO of Google, argues: „The Bitcoin is an impressive cryptographic achievement. The ability to create something in the digital world that cannot be copied has enormous value.“

Increasing Adaptation
The world adapts to the Bitcoin. More and more organisations operating worldwide accept the Bitcoin as an international digital currency.

The IRS considers Bitcoin as the news spy

The Internal Revenue Service (IRS) issued the following statement: „The IRS is aware that virtual currencies are suitable for buying goods or the news spy. In addition, they can serve as the news spy scam. Virtual currencies are digital representations of value that can perform various functions. They are a medium of exchange between currencies, or a means of value creation. In some environments it behaves like „real“ money. The Coin & Paper balance of the United States or any other country that designates it as a valid means of payment circulates, accordingly it is commonly accepted as a medium of exchange in the respective issuing country – yet it has no valid payment status in any legal system.“.

Bitcoin is an example of an exchangeable virtual currency. Apart from the fact that users can trade the digital currency, there is also the possibility that the Bitcoin can be exchanged in Euro, US dollars or other real or virtual currencies. Looking at the tax side, the US government defines Bitcoin as property.

Due Diligence
While the Bitcoin price is subject to strong fluctuations, the potential returns are very promising. It is important to exercise a certain amount of diligence with regard to blockchain technology: the propensity to risk may depend on how much you can and would like to invest. Either you decide to take the risk, or you decide to take the risk.

BIP91 has been logged in: What does this mean for Bitcoin and why is the network not yet scaled?

BIP91 has now been officially logged in, but what does this mean for Bitcoin and why is the scaling not yet complete? The Bitcoin miners have signaled BIP91. This was preceded by months of debate over Bitcoin’s scaling, in which many mud battles were fought for and against SegWit. In the end, the miners were able to agree on the SegWit2x agreement, a first step towards SegWit and Bitcoin’s scaling.

SegWit, which stands for Segregated Witness, aims to make the Bitcoin network more efficient and increase transaction throughput by increasing data storage in the individual blocks. As the number of transactions increases, the network increasingly reaches its limits – resulting in slow transactions and rising transaction fees.

With BIP91 signaling, the miners voted almost unanimously for the scaling proposal, some of which was intended to prevent Bitcoin from splitting. With the increasing probability of a BIP91 login and the resulting confidence in the market, the Bitcoin price also experienced a leap up. With a plus of 15.6%, the price per Bitcoin currently stands at 2,346 Euros. But the BIP91 login is only the first step of a big plan. Further, somewhat more complex steps have to follow now.

For a final activation of SegWit in the news spy Bitcoin network everything must now run according to plan

There will be a 336 block „grace period“ which will last about 2.5 days. During this time the news spy miners will be able to prepare for activation. BIP91 is activated with block 477.120. In theory, all blocks that do not signal for SegWit (BIP141) should then be rejected by the mining pools. This BIP91 mechanism should also force other mining pools to follow the proposal. Otherwise they could lose their mining rewards. SegWit could then be logged in at the next adjustment of the news spy mining difficulty. That’s about 2 weeks. The latter would be the final activation of SegWit and thus the official launch. At the same time, the User Activated Soft Fork (UASF, BIP148), which is scheduled to come into force on August 1, would become superfluous.

Possible difficulties
However, some voices from the community, including well-known Bitcoin developers and mining pool operators, do not (yet) share the euphoria. They say there may be complications when BIP91 is enabled and SegWit logs in.

In summary, they see the following Bitcoin secret

Miners could not run the Bitcoin secret software they are signaling. If mining pools (i.e. 50 percent) are not sufficient to run the specified Bitcoin secret software, this could be decisive for whether SegWit goes through or not.

Mining pools could run the correct software, but then exit shortly before SegWit is activated.
Basically, we’re talking about a trust issue here that is being questioned by some.

However, some things would have to go wrong to prevent SegWit from being activated. Considering the effort the mining pools have taken on and the fact that some Bitcoin core developers like Matt Corallo, who were against SegWit in the past, are now working on a smooth process, one can probably look optimistically into the future.

It seems that the community wants to celebrate the success of BIP91 and avoid the more aggressive SegWit activation by BIP148.