It is a decade since August 15^th, 2010, the day in which a person took advantage of a bug in the Bitcoin (BTC) code to create 184,467 million BTC. The cryptocurrency, which was one year and eight months old, was still in its infancy. During those years, Satoshi Nakamoto, and his collaborators worked many times by trial and error, so that Bitcoin met the high standards that they imposed themselves.

The means of communication they used between them was the Bitcointalk forum. That Sunday in August, Jeff Garzik, who helped develop Bitcoin from the early years, wrote there: “The exit value at block 74,638 is quite strange.”

It is that the block showed that, for 1 hour and a half, there were outputs that reached a total of 184,467 million BTC. This is a value of almost 8,800 times higher than 21 million, which is the maximum supply set for this cryptocurrency.

What could have happened?

Another user of the forum, under the pseudonym “LFM,” explained what happened. He said that a person made a custom modification of the software to generate a transaction that exploited vulnerability in the code and artificially inflate the supply.

The code used to verify the transaction before, including it in the block, did not contemplate the case that the outputs were so large that they got excessive when added.

LFM added to its explanation of this weakness of the program that the code checked the output of each transaction for numbers individually, but “forgot” to check whether the sum of two outputs resulted in a negative number.

Therefore, if two significant but positive values got a place in the transaction, the overflow was only checked if it was less than or equal to the inputs. Thus, it was possible to issue several coins that excessively inflated the supply.

A solution in record time

Soon, Nakamoto and developer Gavin Andresen began working to fix what happened. Just 2 hours and 21 minutes after Garzik made the announcement, they released a patch for the code that fixed this problem in future transactions. An hour later, the spot saw an upload to the repository. The role was to reject outbound overflow transactions, like the one that had got made, and also any transaction that pays more than 21 million BTC in a single exit.

The solution was a soft fork of the blockchain whereby the problematic transaction and all subsequent transactions found a reversion. The miners accepted the proposal, and the new blockchain surpassed the old one at block 74,691, nineteen (19) hours after the incident. The ideals of immutability were momentarily set aside for the greater good and long-term benefit to the community.

Currently, there is no malicious transaction or the BTC created, although the 0.5 BTC it consumed does. They have not used this according to the Bitcoin wiki; they appear to come from a faucet. This was the only major security flaw found until now in the entire history of Bitcoin. To date, the first cryptocurrency had 48 vulnerabilities detected, although none as serious as this one.

All Miners Should Stop Processing Transactions until a Solution Appears

A few days before the four months of the incident mentioned here, Nakamoto published his last message on Bitcointalk. It was a fix to prevent denial of service (DoS) attacks.

After that, the creator of Bitcoin disappeared from the public scene, and, since then, his identity is the subject of speculation worldwide.

Furthermore, it was a suggestion that all miners stop processing transactions until a solution appears. It was requested to ignore the block in which the error occurred and all subsequent blocks.

By Jenson Nuñez

Google and Apple withdrew the popular game Fortnite from their application centers after the manufacturer Epic Games decided to use its payment platform and not those of the Play Store and App Store. The first to conduct the measure was the company behind the little apple, which alleged that App Store guidelines were violated.

In response, Epic Games filed two lawsuits against the companies alleging that they conduct monopolistic practices, which escalated the conflict that began this Thursday. Both Apple and Google charge a 30% commission for processing payments to developers who use their software stores. The lawsuit against Apple specified the following:

In a statement sent to The Verge, Apple emphasized that the conditions are the same for all developers who use its App Store. Besides, he highlighted that Epic Games enabled the function in its application without being “reviewed or approved” by the company.

On the other hand, Google responded by saying that its policies are “fair to developers” and that the guidelines keep the store safe for users. Regarding Epic Games’ decision to use its system to process payments, it highlighted that the measure violated its internal policies.

The conflict started when Epic Games decided to use its in-app solution to process all user payments. The measure would allow it to offer cheaper packages (V-buck) to its players with discounts of 20%. It was not clear what the update process will look like for the new version of the game or if the move could get a reversion.

What happened with Epic Games, Apple and Google once again put on the table the issue of free competition and the practices of large companies to force the use of a specific payment method. In May 2017 that precisely Apple and Google, together with PayPal, were seeking the formula to establish greater regulation for digital payments.

At that time, it indicated that the transmission of money was a common difficulty and that much of the work conducted in the bitcoin and cryptocurrencies community was related to the new standards implemented.

Just hours after Epic Games revealed that it was going to allow in-app purchases, Apple responded by removing it from the App Store (a risky move considering Fortnite’s immense popularity and a high number of players), in the face of what the developer filed the lawsuit.

“That Apple has withdrawn Fortnite from the App Store is another example of its abuse of power to impose unreasonable limits and illegally maintain its monopoly on the market for processing payments within the applications in iOS operating systems,” they said from Epic Games in a statement.

On the other hand, Apple defends itself by claiming that its internal policy for the App Store creates an environment of equality for all developers and, at the same time, “protects” customers against possible fraud or illegal content. Concerning Android, which also takes a commission for each purchase made within the video game, Fortnite was still available on Google Play by mid-afternoon on Thursday.

By Jenson Nuñez

The rise of decentralized finance protocols (DeFi) continues with its meteoric rise, as evidenced by the latest launches of projects such as Serum, a future decentralized exchange whose token increased in price by 1,600% in a few hours.

The Serum (SRM) token price rose sharply on Tuesday, hours after launch when it jumped from $ 0.10 to hit $ 1.98. In the next 24 hours after issuance, the asset’s value had soared 1,600%, while the trading volume exceeded $ 500 million, as Coingecko data shows. At the time of writing this article, the asset is trading at $ 1.77.

Binance listed Serum with four trading pairs within hours of its launch, which may have contributed to the token’s price increase. Serum is also available to operate on DeFi protocols such as Uniswap, BitMax, HBTC, Balancer, TomoDEX, 1Inch, and FTX.

Serum: functional medicine for DeFi

Serum has three tokens: a “wrapped” utility token, SerumBTC, which has a price pegged to its underlying asset; a stablecoin, SerumUSD, which is a trackable, ERC20 token to enable physically-settled, cross-chain contracts, and a governance token, which provides trading discounts on Serum, and with revenue earned from transactions on the network. Staking for SRM on the Serum platform also went live today, enabling holders to make a yield on their tokens for the first time. One million SRM—dubbed “MSRM,”— is needed to participate in operating a staking node.

The Serum team is led by co-founder and CEO Sam Bankman-Fried, who is becoming well-known in the decentralized finance (DeFi) space after launching the FTX trading platform, and quantitative trading startup Alameda Research. As well as Binance and Uniswap, SRM is listed on several other exchanges, including BitMax, HBTC, Mesa.Eth, Balancer, TomoDEX, 1Inch, and, of course, FTX.

How DeFi Platforms Work

The operation of DeFi is possible thanks to blockchain technology and smart contracts as they are derived tools from blockchain. The concept of smart contracts or intelligent contracts was created by the cypherpunk Nick Szabo, in the year 1994. Szabo conceptualized them as a free program capable of executing a series of instructions or clauses according to whether a set of preparations came fulfilled. It was the equivalent of a legal contract, but brought to the computer world, and enhanced with the ability to be autonomous and completely anti-cheat.

Nick Szabo’s vision was ahead of its time. He had to wait until the emergence of Ethereum when he could finally see a smart contract at work. It was not perfect, but it was enough to start building new things. Dapps or Decentralized Applications were born this way, programs that ran directly on the Ethereum blockchain, and with which we could interact using tokens, and a browser. This is a second advance that finally opened the doors for the construction of DeFi.

By Jenson Nuñez

Despite all the excitement about DeFi, Ethereum creator Vitalik Buterin is not involved in yield farming. He recommends investing small amounts until really understanding how the system works.

The launch of YAM recently filled the crypto community with excitement. This decentralized finance (DeFi) protocol promised its users the ability to perform “staking” with equal opportunities. However, few rode the wave of decentralized finance. Vitalik Buterin, Ethereum Founder, himself commented that he has not been actively involved in yield farming.

It seems that 2020 will go down in history as the year in which decentralized finance entered the crypto market with force, after years of building the basic infrastructure that sustains the crypto world. Organizations like Tron and Binance are beginning to focus their efforts on DeFi, as a mechanism to face traditional finance designed around fiat money.

This boost to decentralized finance includes yield farming, which is assuming unprecedented importance. This is a method to drive decentralized lending platforms. Users who participate in it invest a certain amount of money, which the system will use to grant loans in a decentralized way. In exchange, investors will receive rewards in the DeFi platform token, in addition to interest on the loan.

If the price of the platform’s token increases, investors will receive significant returns on their capital. However, if the platform fails, then they could lose all their capital.

Despite these risks, the crypto community has been turning to investment in these types of yield farming projects. This has led to the rise in the price of currencies like YFI, which has increased in value several times in recent days.

Vitalik Buterin Does Not Ride DeFi Wave

Not everyone is sharing the excitement that yield farming has generated. Several figures in the crypto world have warned against getting too excited about these types of projects. They have reminded the negative effects that the rise of Initial Coin Offerings (ICO) had in 2017. Vitalik Buterin is one of those who have not yet ridden the DeFi wave, admitting on his Twitter account that he has not participated in yield farming.

“The truth is that I have not participated in yield farming. I put some coins on uniswap some time ago, but I withdrew them after earning a few percentage points in commissions, but that was it,” stated Vitalik.

The founder of Ethereum added in another tweet a warning for the users of the platform against this type of project. In it, Vitalik tells users about the risks of participating in “the latest hot DeFi thing” if they do not understand what is happening. He recommends exploring the various Ethereum dApps and starting by investing very small amounts.

In this way, Vitalik Buterin would be warning against an excess of excitement about these DeFi projects. Although these promise quick profits in a short time, they are sometimes a source of losses for those who invest in them.

By Willmen Blanco

According to the Brazilian regulator CVM, Bitcoin Bank Group does not show favorable behavior. A judge ordered an investigation into the group for alleged “sophisticated fraud.”

Bitcoin Bank Group submitted a request to the Brazilian Securities and Exchange Commission (CVM) so that the regulator would reactivate its activities. In 2019, the auditing entity had ordered the cessation of its operations. The regulator argued that there was no evidence of a change in behavior or a compensation plan for the affected users without access to their allegedly hacked funds.

The CVM debated on August 11^th the request that Claudio José de Oliveira and Johnny Pablo Santos made. Both are representatives of the firms Bitcurrency Moedas Digitais S.A. and CLO Participações e Investimentos S.A., belonging to the aforementioned group. On August 12^th, the commission issued a press release rejecting the proposal.

The regulatory authority stated that “there was a legal impediment to the implementation of the agreement since there was no evidence of the termination of the behavior nor any proposal for compensation for the losses caused to the investors. Considering the seriousness of the accusation, the Committee on Commitment suggested the rejection of the request”.

Last year, the CVM halted the group’s operations because the entity was not registered to trade securities. Besides, the group was promising to generate income by conducting arbitrage with Bitcoin and alleged cryptocurrency brokers. However, the users began to report that they could not make withdrawals from the platforms.

At that time, the entity reported that a group of hackers had allegedly stolen the bitcoins from the operators. As a desperate measure to recover their funds, the users began to sue the group’s companies.

In the proposed agreement that it submitted to the CVM, the group offered to stop the offers but did not convince the authorities. With the decision, Bitcoin Bank Group remains unauthorized to conduct operations.

Ups and Downs of the Bitcoin Bank Group

Claudio José de Oliveira came to be known as the “King of Bitcoin” due to the space that the group gained among Brazilian users. After the CVM intervened, Bitcoin Bank Group got a fine of BRL 100,000 per day (equivalent to around USD 18,000) if it did not stop the promotion and its operations.

At the end of 2019, Bitcoin Bank Group went bankrupt, leaving hundreds of users in limbo. According to reports, there are people at risk of losing their homes after mortgaging them and investing funds that they are now unable to recover.

One user even decided to kidnap Oliveira’s mother and sister-in-law demanding a ransom in bitcoins to free the women. The businessman did not have to make the payment as the local police managed to rescue the victims.

The CVM’s decision confirms the blocking of the group’s operations, which also has frozen properties in several Brazilian cities and lawsuits in seven states. A judge even ordered an investigation into the organization for alleged “sophisticated fraud”.

By Alexander Salazar

Ripple’s director says that the company will be a giant in the area of payments in two years. This occurs in a context in which the company could lose investors.

The company Ripple, developer of the XRP token, is currently in the process of adding new trading strategies to its business model.

The company seeks to be “the Amazon of payments” through a payment platform that allows individual users to use the XRP token.

Brad Garlinghouse, the CEO of Ripple, explained that Amazon initially only sold books and is now a global trade giant. He predicted that people Ripple will be to payments what Amazon was to books “two years from now.”

Of course, this would be in parallel to the service that Ripple has provided to banks and financial institutions since its beginnings.

The newspaper Financial Times considered that the incorporation of this platform implies that Ripple is in the process of making a “commercial strategy reset”. They stated that this occurs because the adoption by banks was not what they had expected.

In this regard, Garlinghouse clarified that this is not a matter of strategy reset. He argued that cross-border XRP payments are working, which he substantiated by saying that “more than two dozen customers are on board.”

Ripple’s Reputation in the Cryptocurrency Ecosystem

Michael Arrington, Founder of the informative website TechCrunch, criticized Ripple’s strategy for winning over banks, whose systems are already adapted to the current system. He said that it would be “like Uber trying to disrupt the taxi business by working with taxis.”

On its new course, Ripple will have to shed its controversial reputation within the cryptocurrency ecosystem. Since many participants in this micro-world have anti-establishment ideals, they do not approve of the links that Ripple tried to consolidate with the traditional banking system.

For that reason, Arrington considers that the new platform that Ripple seeks to develop “will receive a lot of hatred within the world of cryptocurrencies.”

Impact on Price of XRP

In August, the XRP token has not continued the bearish trend that it had. At the time of writing this article, it is trading at USD 0.28, after having reached USD 0.32 on August 2^nd. However, it is 47.3% above the USD 0.19 that it cost last month. It will be necessary to wait to see how the innovations mentioned above will influence the price of the cryptocurrency.

Other situations can influence the price of XRP, such as the rumor that two large investors might be thinking about withdrawing the capital that they invested in the Ripple Company, according to an anonymous informant.

That person believes that investors want to get rid of their capital after the hint of an eventual initial public offering. This could suggest that Ripple shareholders do not trust the company to be ready to go public on the stock market shortly.

The Securities and Exchange Commission (SEC) reported on August 12^th that Goldman Sachs had sold USD 6.5 million worth of shares that it had on MoneyGram, Ripple’s partner remittance company. It is important to remember that Goldman Sachs is one of the largest financial groups in the world.

By Alexander Salazar