China is testing its own digital currency, and Ethereum flash crashed on GDAX this week. Here are the cryptocurrency highlights of week 25:
- China has begun testing its own digital currency for interbank transfers. Recent speeches by national bank insiders along with some publications have indicated the direction the Chinese would like to take. Presently, it seems that the goal would be to provide a second digital currency that would function alongside the yuan. While the technology is likely still a distant potential, the government has begun running tests with the cryptocurrency and even testing its functionality with national banks.
- The price of Ethereum crashed as low as 10 cents from around $319 in about a second on the GDAX cryptocurrency exchange on Wednesday, a move that is being blamed on a “multimillion dollar market sell” order. Adam White, the vice president of GDAX which is run by U.S. firm Coinbase, posted on the exchange’s blog, outlining what took place at around 12:30 p.m. PT on Wednesday. According to White, the multimillion dollar market sell order resulted in a number of orders being filled from $317.81 to $224.48. As the price continued to fall, another 800 stop loss orders and margin funding liquidations caused Ethereum to trade as low as 10 cents.
- Last week, Bancor, a blockchain startup aiming to be the standard for smart tokens, held an Initial Coin Offering (ICO) which raised over $144 million in a few hours. A recent post on Hacking, Distributed claims that Bancor’s ICO was flawed and there were a number of red flags that should have backers concerned about the company’s future. The issues can be broken down into 6 main categories: issues with Bancor’s fundamentals, front-running, bad math and lack of testing, integration and scale, users overpaying, and potential reentry issues. Probably the most troubling issue, however, is the fact that Bancor implemented their own math and according to Professor Sirer: “if there’s a rounding error, one can repeatedly buy & sell at a constant price differential.” That could potentially lead to malicious attackers constantly buying and selling tokens which would drain funds.
- Over the past few weeks, the topic of scaling the Bitcoin network and the recent Segwit2x plan has been a hot subject amongst bitcoiners. A few days ago Bitcoin.com reported on the many Chinese mining companies who have agreed to back the Segwit2x protocol. Alongside this, the Digital Currency Group’s Barry Silbert who organized the New York agreement has been sharing information on the progress every day via Twitter. On June 18 the mining pool Bitfury began signaling for the New York agreement by using the call letters “NYA” in its mined blocks. The very next day a large majority of miners have also started showing support for the Segwit2x plan. The amount of support for the Segwit2x agreement is close to 70 percent of the network hashrate.
- Compared to the previous week the price of Bitcoin has increased by one percent, with the exchange rate currently at about $2694 per BTC. The price of Ethereum decreased by more than 10 percent over the same period, taking Ether down to a rate of $336 per ETH. Ethereum Classic lost about two percent, with the price decreasing to $20.78 per ETC. Zcash gained less than one percent. One ZEC is now trading at roughly $373 per coin.