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What is a 51% Attack?

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51% attack

The Bitcoin network is one of the most secure financial payment networks in the world. As a decentralised network, it lacks a focal point of failure and since its inception in 2009 it has never been successfully hacked, despite various attempts.

However, there exists the danger of a so-called 51% attack against the Bitcoin network, which would cause massive internal disruption to bitcoin to the extent where the currency could become unusable.

A 51% attack refers to one bitcoin mining operation taking control of more than half of the bitcoin network’s hashrate.

Until very recently, most bitcoin holders believed the chances of a 51% attack ever happening to be very slim. The notion that a single entity would one day control more than half the computing power used to mine bitcoin was seen as an almost impossible task. For seasoned bitcoin users, however, the threat of a 51% attack has been an ongoing conversation in the crypto community, especially in light of large mining operations emerging in China, which would eventually collude to take over the network.

How would a 51% attack work?

For people who aren’t regular bitcoin users, the existence of such a threat is probably new. To get a better understanding of the danger this threat poses to bitcoin, here is a simple explanation on how it works.

Presently, they are close to 13 million bitcoins in existence and every 10 minutes 12.5 new coins are added through a process called mining. To mine bitcoins you need to deploy specialised bitcoin mining hardware that are specifically designed for the task. These computers will join other machines, which run the same program, in attempting to solve a complex mathematical algorithm to process transactions and, thereby, mine new blocks in the blockchain. For the new blocks mined, the miners are then rewarded in the form of new bitcoins. Currently, most miners are in mining pools with the aim of uncovering more blocks regularly and sharing the rewards.

Once a single mining operation would take control of more than half of the network’s hashrate it would have the power to reverse transactions and, therefore, engage in double spending. Once double spending occurs in the Bitcoin network, no more trust will be left in it and it would most likley become unuseable as a financial payments network.

With the Bitcoin network being open and accessible to anyone, nothing is really stopping a company from making a massive investment in mining hardware capable of taking over the entire Bitcoin network. However, one could argue if this would be in the best interest for such a company. Even if someone were able to initiate a successful 51% attack, complete control of bitcoin would still be out of their grasp. While it would present a significant threat, controlling more than half of the hashrate is not enough to shut down bitcoin.

They may be able to reverse transactions, but only for those sent by wallets under their control. If two different users transact between each other, but neither is part of the entity holding more than half of the hashrate, their transfers cannot be reversed. However, they would have to put up with no network confirmations for some time. The perpetrators of such an attack would not remain in control for that long, making the entire undertaking quite inefficient to carry out.

In some ways, this seems as an important crossroad for bitcoin as an issue that has often been discussed in a theoretical sense is now within the realms of possibility. With mining pools in China holding large percentages of network hashrate, collusion can be a possibility.

It remains to be seen whether a 51% attack will ever happen but given the amount of vested interest in the Bitcoin network staying decentralised, I would be surprised to see such as an attack taking place.

Bitcoin

Crypto.com Introduces Crypto Earn and Crypto Credit

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Crypto.com

Cryptocurrency platform Crypto.com has introduced Crypto Earn and Crypto Credit to enable users to earn interest on their coins and borrow by using digital currency as collateral.

Crypto Earn And Crypto Credit

Crypto Earn is a financial product that allows users to earn as much as eight percent per annum in interest on their cryptoasset holdings.

Crypto.comTo do this, users deposit digital assets into Crypto Earn through the Crypto.com app and then begin accumulating interest each day through their preferred cryptocurrency. To get started with Crypto Earn, users will have bitcoin, Paxos, and TrueUSD to choose from, according to a company press release.

Crypto.com is offering users two fixed periods namely one-month and three-month terms to earn interest on digital assets. The company will soon provide users with a flexible holding term. With Crypto Earn, you can also withdraw and deposit coins at no fees and spend what you earn.

Crypto Credit gives users instant loans with bitcoin as collateral. Users are free from fixed repayment schedules, monthly fees, payment deadlines, and late fees which financial institutions such as banks often impose. Users, therefore, enjoy a flexible repayment schedule in the twelve months from the beginning of the credit term.

Furthermore, users owning MCO tokens staked in the app receive a special rate of eight percent per annum. Users can use their loans to buy more cryptocurrencies on the app or they can spend it on the MCO Visa Card with cash back of up to five percent.

Other benefits of using Crypto Credit are that you do not require credit checks and that you can get the credit limit you want.

“Crypto Earn offers the most attractive interest rates in the market today. With the MCO Visa Card and Crypto Credit, we are uniquely positioned to do it while maintaining sustainable unit economics. MCO Visa Card, Crypto Earn, and Crypto Credit together form a powerful product suite that nobody else in the industry has today. We have never been more excited about the potential of our platform and look forward to continue scaling it globally later this year,” said Kris Marszalek, co-founder and CEO of Crypto.com.

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Different Kinds of Bitcoin Trading Strategies You Should Know About

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trading strategies you should know

Bitcoin has been around for over 10 years now. There are a lot of things that have evolved with it over the years, including how easy and secure it is to buy, the different ways we can buy it, and the various bitcoin trading strategies that people use now.

There are a lot of bitcoin trading strategies now that it could intimidate a lot of newbies trying to get into bitcoin. The truth is, each strategy caters to a specific kind of trader so if you’re new, these strategies might be worth looking into before you invest any kind of money.

Different Strategies

To help get you started on choosing the kind of strategy you’re looking for, here are the two most common strategies that bitcoin traders use:

HODLing

You may have seen this slang around while doing your research. “HODL” refers to holding your position. It was created in 2013 when bitcoin’s price was dropping but a certain user decided not to sell his shares. He meant to write “HOLDing” but ended up making a typo instead: “HODLing”. It eventually caught on and people decided to give it a new meaning: “Holding On for Dear Life.”

The HODLing strategy refers to the holding of your bitcoins in hopes that your investment will grow over time. To start HODLing, buy bitcoins in bulk when the price is low and then keep it close while watching the crypto market. People can hold their positions from weeks to months to even more than a year. It’s the easiest and one of the more common trading strategies.

Day-trading

BTCDay-trading is another very common form of trading in the bitcoin world. The strategy refers to closing all your positions before the day ends. It involves executing long and short trades to capitalize on the market price of that day. Basically, this prevents having open positions overnight by finishing all your trades within the day.

It’s a more technical form of trading and it requires your full attention and a lot of your time. You’ll need to keep a close eye on all your positions and possibly watch multiple screens to do so. It requires a high degree of focus as well as a good knowledge of how the crypto industry works.

Just getting started

These two trading strategies are literally the most common forms of trading. There are so many more strategies such as swing trading and alt-coin filipping that you’ll need to learn but these two should get you started on your bitcoin journey.

Now, all you’ll have to do is decide on which of the two suits you more. Be sure to figure out your game plan before getting into bitcoin at all and your style should follow.

This guest post was contributed by cryptocurrency education and news platform WeAreCryptos. 

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Ghana’s Securities Exchange Commission (SEC) Warns Public About Investing in Crypto

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In a recent statement, the SEC of Ghana has warned the populace against investing in cryptocurrency and crypto-related investment schemes. This warning comes amidst a growing concern of the Security and Exchange Commission (SEC) about how Ghanaians are diving head first into the cryptocurrency market.

SEC Warns About Crypto

The Director General of the SEC, Rev. Daniel Ogbarmey Tetteh, signed an official statement released by the Commission that cautions the general public about cryptocurrency trading and all crypto-related activities as these are not regulated by the Securities Exchange Commission reports News Ghana

“[Cryptocurrency investments] offered by unregistered and unlicensed entities on digital online trading platforms with promises of high returns on investment are not sanctioned nor registered by the SEC”, the statement read.

The Commission’s statement further read:

Ghana SEC“The SEC wishes to inform the general and investing public that none of these cryptocurrencies is recognised as currency or legal tender in Ghana. The platform on which they are traded are not also licensed nor regulated by the SEC. The SEC would like to make it clear that it does not currently regulate these types of products offerings and their accompanying online trading platforms or Exchanges. Members of the general public who are investing or intend to invest in such currencies or assets may be doing so at their own risk and can in no way be protected under the Securities law regime in Ghana.”

Currently, digital asset trading remains a regulatory and legal grey area in the West African nation. Whereas the SEC has stated that it is presently not in support of or regulating cryptocurrencies, it also has not stated that cryptocurrency trading is illegal.

The regulator only mentions that they are “unregistered, unlicensed, and unregulated under the Securities Law of Ghana“. Thus, this can be very much regarded as a “disclaimer” on the part of the regulatory body to the public to sensitise them that trading in cryptocurrencies in the country presently is only done at one’s own risk.

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