The function aims to correct possible errors when making a transaction.

The Electrum wallet incorporated a button to cancel unconfirmed Bitcoin transactions with RBF, a method that facilitates the replacement of a transaction by increasing the user’s commission. The update comes weeks after the wallet suffered a cyber-attack that has allowed the theft of 1,980 BTC through phishing since 2018.

The new version 4.0.4 of Electrum is available from October 15 on the wallet download site. The new feature makes it possible to cancel a Bitcoin transaction before it is confirmed, increasing the commission through the RBF (commission replacement) method to generate a “double-spend”.

“The Qt / kivy GUI cancels an unconfirmed RBF tx by spending twice its inputs on the same [transaction],” as read in the Electrum release notes on GitHub.

For the cancellation to be effective through the button incorporated into the wallet, the user must have enough balance, since the cancellation is executed by taking advantage of a Bitcoin property that prevents the same transaction from being confirmed twice.

This function corrects errors in sending bitcoins that are detected before the first confirmation occurs on the network. The transaction is canceled, but the highest commission corresponding to the RBF is paid.

Transaction replacement has been controversial since Satoshi Nakamoto implemented and deactivated it in 2010. The reason is that replacing a 0 commit transaction can be risky, especially in a world where merchants depend on these types of transactions (in theory faster because there is no need to wait for anything from the network).

The reason is that there is the latent possibility that a transaction will be replaced immediately after acquiring a service or a product; therefore, one of the parties involved in the transaction can be deceived before its transaction is irreversible.

Bitcoin Core developers such as Peter Todd and Jonas Schnelli have explained these risks over the years. They have also stated the need for wallets that implement these techniques for users to safely complete and/or cancel transactions.

RBF is commonly used to unlock transactions that have been stalled awaiting confirmation. For example, as a consequence of having made the transaction with a lower commission than the average at a certain time.

For these cases, CriptoNoticias made a short guide on how to unlock Bitcoin transactions.

Electrum bitcoin wallet improvements

One of the most recent updates to Electrum allows the wallet to be integrated into a full Bitcoin node, as an alternative to the servers of the platform itself.

The full nodes of Bitcoin can transmit information to each other to know the immediate state of the network. This provides greater security on transactions because the user does not need confirmation from a third party or share private information about a certain operation.

Starting in June, Electrum began testing features that allow operating payment channels on the Bitcoin Lightning network. This long-awaited update as the one that allows canceling unconfirmed transactions, includes for the moment the possibility of executing payments through individual channels, as it does not yet incorporate the function for payments through multiple channels.

Recent vulnerabilities in Bitcoin wallets

Recent Electrum updates also focused on fixing vulnerabilities. Since 2018, hackers took advantage of a certain weakness in the system to steal bitcoins from users who were deceived with false updates.

As CriptoNoticias reported, the same design error in the Ledger and Trezor wallets was also detected in August. According to researcher Monokh, the vulnerability facilitated the theft of bitcoin by executing a deceptive transaction with bitcoin cash, litecoin, or some currency from the Bitcoin testnet.

By: Jenson Nuñez.

The researchers estimated the influence of financial literacy on attitudes toward bitcoin, based on four categories: current ownership, intention to own in the future, no intention to own in the future, and having heard of these types of assets.

As the ecosystem of bitcoin and other cryptocurrencies grows up and evolves, in recent years various studies have emerged to attempt to identify a profile of people who acquire and use crypto currencies. For this, variables such as gender, age, socioeconomic status, level of education, and knowledge of finances, are mainly taken into account.

It is precisely around financial knowledge that the most recent report prepared by the Central Bank of Canada revolves, according to which financial education has a positive link to knowledge about crypto currencies, but a negative association to their possession.

It is worth clarifying that, this and other research, financial knowledge is “the degree of information that a person has about key financial concepts and their ability to apply that knowledge in making financial decisions.”

The results of the “Cash Alternative Survey 2019”, following the definition above, indicate that Canadians with a lower level of understanding of finance are those who would be twice as likely to invest in bitcoin.

According to such study, 93% of Canadian residents with a high level of financial information are aware of crypto currencies. Of that group, only 4% have them. In contrast, 72% of the respondents, with a low level of financial knowledge, know about these assets, but only 8% have their cryptocurrencies.

Thus, it is clear that “financial literacy” offers users a greater understanding of concepts central to economic decision-making. Consequently, it follows that people with low knowledge of finances are the ones who “take risks” and acquire cryptocurrencies. This due to their poor financial training.

This specific issue, addressed by the Think Forward Initiative was made up of the financial group ING, together with partners such as Deloitte, Dimension Data, CEPR (Center for Economic Policy Research), Dell / EMC, and Amazon Web Services.

Think Forward published earlier this year the results of study on “Financial literacy and attitudes towards crypto currencies.” In this case, it took into account a wider universe, surveying people from 15 different countries in 2018, including the United States, Australia, the United Kingdom, Asian countries, and members of the European Union.

The researchers estimated the influence of financial literacy on attitudes toward bitcoin, based on four categories: current ownership, intention to own in the future, no intention to own in the future, and having heard of these types of assets.

Think Forward stresses that people with more financial knowledge are less likely to own crypto currencies

Similar to the Bank of Canada, Think Forward stresses that people with more financial knowledge are less likely to own crypto currencies. They argue that “it is more likely that this group does not intend to possess them in the future.” To this, they add that “the more financially literate a person is, the more likely they have heard of crypto currencies, although they are less willing to acquire them.”

The study sought to know whether ordinary bitcoin users have the appropriate financial knowledge and skills “to use inherently complex, risky and volatile financial instruments.” It infers that the lack of financial information leads people to this market.

By: Jenson Nuñez.

This regulation is currently in proposal mode for the crypto market by the EU and will pose many compliance hurdles for any Libra-like project intending to perform functions in Europe.

In the crypto world, fall appears as the opening and promising season for regulators. Although unprecedented, the year 2020 is no exception to this trend. The situation is highly tense on both sides of the Atlantic: markets were still processing news from the US Commodity Futures Trading Commission cracking down on derivatives exchange platform BitMEX and the Financial Conduct Authority, the British financial watchdog, was in the move to ban retail investors from using derivatives in cryptocurrency.

This dense cycle is bringing a lot of long-lasting effects on the global financial system, so the EU finally proposed legislation for crypto markets.

Stablecoins and stability is on the table: Regulation of the Crypto Assets Markets

The project, known as “Regulation of the Crypto Assets Markets,” or MiCA, is a proposal submitted by the European Commission, the executive branch of the EU. It is set to go through a fairly lengthy legislative process before getting its form as a solid law, which means it could take months and even years before the new rules begin to affect and affect the system.

The text shows that stablecoins, which are also referred to as “asset-related tokens” and “electronic money tokens” in the document is high on the minds of European legislators: MiCA highlights this asset class and provides users with a tailored regulatory framework.

Under the proposed law, stablecoin issuers will act and be included as a legal entity in one of the EU member states. Other requirements set the inclusion of provisions related to capital, investor rights, custody of assets, disclosure of information, and governance provisions.

Libra as the starting point for EU thinking about the dangers and opportunities presented by asset-related tokens.

The depth of concern of senior EU officials to preserve the Union’s monetary sovereignty is illustrated by the fact that, in early September, “the finance ministers of Germany, France, Italy, Spain, and the Netherlands issued a joint statement, outlining that stablecoin operations in the European Union should be halted until legal, regulatory and supervisory issues are addressed, “said Konstantin Richter, CEO, and founder of infrastructure company Blockdaemon.

Richter added that some of the most visible figures in European financial policy, such as German Finance Minister Olaf Scholz, have advocated for the introduction of the regulatory framework.

The experts cited the Facebook-backed stablecoin Libra as the starting point for EU thinking about the dangers and opportunities presented by asset-related tokens.

Mattia Rattaggi, chairman of the board of directors of FICAS AG – a crypto investment management company based in Switzerland – stated that stablecoins have the greatest probability of great impact, as the application of blockchain technology.

By: Jenson Nuñez.

The FSB fears that stablecoins will compromise countries’ financial systems.

The organization recommends tight regulation for stablecoins.

The Financial Stability Board (FSB), an international body created by the G20, sees potential risk in the massive adoption of stablecoins or currencies anchored to the value of fiat currencies. This is how the organization establishes it in its report the regulation, supervision, and inspection of «Global Stablecoins Agreements», published recently.

For the FSB, a “global stablecoin” is one “with potential reach and adoption in multiple jurisdictions and the ability to achieve substantial volume.” According to the organization, the current risks associated with the use of these types of currencies are few. In particular, this is due to a “relatively small scale” and “limited use cases” for stablecoins today.

The report states that the use of stablecoins as a type of payment or a store of value “could increase significantly in the future, possibly on a large scale and in multiple jurisdictions.” And in that scenario, any risk analysis could change, adds the FSB.

Among the main threats, the organization considered that a wide use of stablecoins as a store of value would expose its users to risks in the event of fluctuations in the value of the currency, by variations that could happen in the underlying assets of the stablecoin. Other arguments are that  “Even a moderate variation in its value can cause significant fluctuations in the wealth of users”.

These negative effects would have a greater influence in economies that are trying to emerge, where the use of stablecoins as a store of value is friendlier.

The agency states that the risk is extensive, and even includes infrastructure problems, as sustained use of these digital currencies for payments of all kinds “could test the capacity of the support infrastructure to handle high volumes of transactions and the financing conditions of the financial system in general.”

FSB Recommendations about Stablecoins

The FSB document contemplates a series of recommendations for governments, in terms of regulation, supervision, and even surveillance on the use of stablecoins with potentially global reach.

Among these recommendations, it is worth mentioning the call to the authorities to “apply complete requirements for regulation, supervision, and surveillance” for the use of these currencies in their jurisdictions, in addition to complying with international regulations and maintaining broad cooperation between nations “to guarantee regulatory integral”.

Recently, the world’s attention to stablecoins has been on the rise. The European Central Bank, a member of the FSB, came to consider that these currencies could even represent competition for the digital euro, a version of the central bank digital currency region (CBDC), one of the trends that central authorities have pursued around the world.

The FSB has more than 20 members, including countries and organizations. In addition to the European Central Bank, the list includes the International Monetary Fund and the World Bank. Among its member countries, some with clear approaches to the creation of their CBDCs stand out, such as China, which recently accelerated the development of its digital yuan, the United States, whose digital version of the dollar is also in the works, and Brazil, in the Latin American region.

By: Jenson Nuñez.

The FSB fears that stablecoins will compromise countries’ financial systems.

The organization recommends tight regulation for stablecoins.

The Financial Stability Board (FSB), an international body created by the G20, sees potential risk in the massive adoption of stablecoins or currencies anchored to the value of fiat currencies. This is how the organization establishes it in its report the regulation, supervision, and inspection of «Global Stablecoins Agreements», published recently.

For the FSB, a “global stablecoin” is one “with potential reach and adoption in multiple jurisdictions and the ability to achieve substantial volume.” According to the organization, the current risks associated with the use of these types of currencies are few. In particular, this is due to a “relatively small scale” and “limited use cases” for stablecoins today.

The report states that the use of stablecoins as a type of payment or a store of value “could increase significantly in the future, possibly on a large scale and in multiple jurisdictions.” And in that scenario, any risk analysis could change, adds the FSB.

Among the main threats, the organization considered that a wide use of stablecoins as a store of value would expose its users to risks in the event of fluctuations in the value of the currency, by variations that could happen in the underlying assets of the stablecoin. Other arguments are that  “Even a moderate variation in its value can cause significant fluctuations in the wealth of users”.

These negative effects would have a greater influence in economies that are trying to emerge, where the use of stablecoins as a store of value is friendlier.

The agency states that the risk is extensive, and even includes infrastructure problems, as sustained use of these digital currencies for payments of all kinds “could test the capacity of the support infrastructure to handle high volumes of transactions and the financing conditions of the financial system in general.”

FSB Recommendations about Stablecoins

The FSB document contemplates a series of recommendations for governments, in terms of regulation, supervision, and even surveillance on the use of stablecoins with potentially global reach.

Among these recommendations, it is worth mentioning the call to the authorities to “apply complete requirements for regulation, supervision, and surveillance” for the use of these currencies in their jurisdictions, in addition to complying with international regulations and maintaining broad cooperation between nations “to guarantee regulatory integral”.

Recently, the world’s attention to stablecoins has been on the rise. The European Central Bank, a member of the FSB, came to consider that these currencies could even represent competition for the digital euro, a version of the central bank digital currency region (CBDC), one of the trends that central authorities have pursued around the world.

The FSB has more than 20 members, including countries and organizations. In addition to the European Central Bank, the list includes the International Monetary Fund and the World Bank. Among its member countries, some with clear approaches to the creation of their CBDCs stand out, such as China, which recently accelerated the development of its digital yuan, the United States, whose digital version of the dollar is also in the works, and Brazil, in the Latin American region.

By: Jenson Nuñez.

China and the United States will be the main hubs of the blockchain industry, according to a report. OKEx decided to suspend withdrawals amid a police investigation.

The European Central Bank (ECB) recently opened a public survey for citizens to contribute ideas about the Digital Euro. Depending on the results, the agency could launch the project in the middle of next year, with a new research phase.

In recent days, the price of Bitcoin has remained slightly higher, with an estimated average growth of 1.6%. The cryptocurrency has traded between USD 11,266 and USD 11,688. At the time of writing this article, BTC is trading at USD 11,461, as reflected in the market price of Latin America and Spain.

In regards to the ECB survey, the Government of Spain expressed its intention to increase the control over operations with Bitcoin and other cryptocurrencies. For that reason, they proposed the “Law on preventive measures to combat tax avoidance.” This would require citizens to provide detailed information on balances and transactions inside and outside of Spain.

The Central Bank of China requested to accelerate the development of its central bank digital currency (CBDC), the Digital Yuan. Vice-governor Chen Yulu wants to show that the currency protects the security of payments. The central bank’s request came at the same time that the Bank for International Settlements (BIS) presented a document that specifies their way to design digital currencies.

According to the BIS, the Digital Yuan complies with the characteristics that CBDC should have. At the moment, citizens of China are participating in pilot tests, but they fear for their privacy. In Shenzhen, they are distributing 10 million Digital Yuan (equivalent to USD 1.5 million) among 50,000 winners.

The most recent report on distributed ledgers from the consulting firm PricewaterhouseCoopers (PwC) states that 12 countries will concentrate on the global expansion of blockchain technology within the next ten years. China and the United States would lead the way regarding its adoption. Following them will be Germany, Japan, the United Kingdom, India, and France, in addition to the United Arab Emirates, Sweden, Luxembourg, Spain and Italy.

The incorporation of the merger between the Schnorr and Taproot protocols into the Bitcoin code occurred after intensive testing and review. Schnorr (BIP 340) and Taproot (BIP 341) merged with the core of BTC, through the use of tapscript (BIP 342). There might be a consensus on how its activation will take place in an upcoming version of Bitcoin Core.

The OKEx exchange recently suspended the withdrawal of cryptocurrencies from its platform after having lost contact with one of the signers of transactions. The exchange explained that a public service called one of the service’s privacy key holders to cooperate with them. The announcement caused a slight reversal in the crypto market a few days ago.

By Alexander Salazar