Blockchain Platform of Central Bank of Brazil Requires Investment of Nearly USD 250,000

Alexander Salazar
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Blockchain Platform of Central Bank of Brazil Requires Investment of Nearly USD 250,000

PIER is an extensive database that will be part of three Brazilian financial institutions. The platform is currently operating on JPMorgan’s Quorum blockchain.

The new blockchain platform of the Central Bank, PIER, cost more than one million reais (BRA) (equivalent to nearly USD 250,000) and will run on the Quorum blockchain, which belongs to the renowned financial services company, JP Morgan.

The Central Bank of Brazil began developing PIER blockchain in 2017 and launched it in early April this year. In total, the agency is investing exactly BRA 1,300,000 (equivalent to about USD 248,008).

Even though that is a huge amount of money, the Central Bank is confident that PIER will be worth it. It is an extensive integrated database for the Central Bank of Brazil (BCB), the Brazilian Securities Commission (CVM), the Superintendency of Private Insurance (SUSEP) and, eventually, the Superintendency of Social Security (PRIVEC). The objective is to replace the procedure of sharing Brazilian paper records with a fully digitized one.

The use of PIER has already shown positive results. For example, it is now possible to do something that used to take many hours or days in a few seconds. All the necessary data are available online, according to the Central Bank of Brazil, also known as Bacen.

Important coordination of efforts under the agreement between CVM and the Central Bank has made the use of PIER possible. Besides, this is a delivery that responds to regulators’ frequent demand to comply with the obligations to the State most rationally and predictably possible. Besides, the platform will contribute significantly to the increasing effectiveness of regulators’ individual or coordinated action, thus being a real win-win situation.

These data are more reliable, since PIER removed them from the source, and are now on JP Morgan’s open-source Quorum blockchain. According to the Central Bank of Brazil, this Ethereum-based platform overlaps the “private IT infrastructure”.

The blockchain gives each regulator easy access to the records of its sister organs. This will allow processing information, from verifying political appointments and conducting financial investigations to authorizing companies, in a faster and cheaper manner.

How PIER Will Work

A publication on the official CVM website explains how PIER will integrate the systems of the three regulatory institutions. It takes into account an extensive integrated database, with information on the following three types: (1) punitive or restrictive, (2) registration or curriculum, and (3) corporate.

In this way, the user will log in, select one topic (of the three mentioned above), insert the regulated CPF or CNPJ (Brazilian tax identification document) and then select the institution to direct the query. Then, the list with the information available will appear on the screen.

This platform provides the user with flexibility so that he or she can make queries with more than one topic simultaneously. There are many possibilities to work with existing data sets, which will depend on the user’s needs, according to Frederico Faria, an analyst at the Systems Management (GSI/STI) of CVM.

Finally, something that used to require many requests and authorizations through traditional means or e-mail will become automated and always have updated data.

By Alexander Salazar

Hash Rate High about to Occur before Bitcoin Halving

Alexander Salazar
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Hash Rate High about to Occur before Bitcoin Halving

Bitcoin’s price fluctuates around USD 6,800, but the hash rate keeps increasing. The event would indicate the connection of a new batch of miners or a migration from BCH and BSV.

In recent days, the Bitcoin hash rate has been about to break a new record, after the network reached a rate of 145 EH/s on April 14th. This increase would indicate the introduction of new miners to the blockchain, despite the steady bearish trend of its market. However, there can be a relationship with the upcoming halving.

According to data from the Statoshi.info platform, Bitcoin registered early on April 14th its highest hash rate of the month, processing 145 EH/s in the early hours of that day. Likewise, it closed April 13th with an average hash rate of 125 EH/s, according to data from Coinmetrics. In this way, the network would be about to exceed the high that it recorded in early March when Bitcoin reached a rate of 150 EH/s.

Even more strikingly, the previous high occurred when the ecosystem was in better financial condition and Bitcoin’s price was around USD 9,000 per unit.

However, the outbreak of the coronavirus pandemic draws a completely different picture. The cryptocurrency market has been having a bearish trend for less than a month and the Bitcoin halving is increasingly close to occurring. At the time of writing this article, Bitcoin’s price is USD 6,730 per unit, according to data from Coingecko.

The rapid increase in hash rate would indicate that new miners are not taking into account Bitcoin’s current price; thus, deciding to connect their equipment to the network. The higher the hash rate of a blockchain, the greater the number of mining devices processing transactions there can be on the network.

Even though the charts show that the Bitcoin hash rate is increasingly high, it is important to consider the ups and downs that occurred between March and April. The drops in the hash rate of the network would indicate that the collapse of the cryptocurrency market has affected mining profitability, but not as much as expected. Miners have rather decided to reconnect their equipment before the halving occurs.

Reason for this Rebound

Alejandro De la Torre, Vice-President of Poolin, believes that the halving could have motivated this increase in the Bitcoin hash rate. In less than a month, the Bitcoin network will lower its reward per mined block to 6.25 BTC, an event that will reduce the profits of the mining industry by half. For this reason, miners may have decided to connect their equipment to take advantage of the last days of blocks with rewards of 12.5 BTC.

De la Torre also states that the introduction of a new batch of state-of-the-art mining devices may have led to an escalating hash rate. ASIC manufacturing companies Bitmain and MicroBT had delayed delivery of their most powerful miners due to the coronavirus. However, the community estimated that Antminer S19, S19 Pro and WhatsMiner M20 equipment would arrive between April and June.

Finally, Poolin executive stated that migration of miners from Bitcoin’s forked networks could be another reason for the rebound. According to data from Coinmetrics, the Bitcoin Cash and Bitcoin SV hash rate suffered a sharp drop on April 8th and 9th, respectively.

The decrease would indicate the disconnection of mining equipment from these blockchains due to the halving of both networks. There was a loss of profitability in Bitcoin Cash, a blockchain that stopped generating good revenues for miners due to the reduction in their reward.

The Coinmetrics graph also shows that just a few days after the disconnection of the ASIC equipment from BCH and BSV, the Bitcoin hash rate began to increase. This movement proves that some miners of these forks may have decided to start mining in Bitcoin and take advantage of is current profitability.

By Alexander Salazar

Blockchain ​​Projects Could Receive Support from The Municipality in Argentina

Maria Rodríguez
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Companies could participate until April 30th.

The Municipality of Mendoza, in Argentina, recently opened a call to offer financial aid to those startup companies working on blockchain projects. The idea is to create a “Red Open Future” of Telefónica, which is one of the world’s leading telecommunications companies.

In this sense, the municipality of Mendoza invites entrepreneurs who are working on initiatives related to Distributed Ledger Technology (DLT), better known as the blockchain. The public body wants the companies in the region to enroll in the project of acceleration and technological drive it hopes to launch.

According to the statement that the municipality published, the public body expects to receive DLT projects adapted to the business model of these companies. So they look for innovative initiatives that offer tangible and visible results for different functions in the future and already use blockchain technology.

How to Participate?

The authorities of Mendoza highlighted that the startup companies interested in participating will be able to register their projects until April 30th. Then, the authorities will evaluate these companies for the final selection.

The most anticipated proposals are those that involve DLT in their processes. Mendoza authorities seek to promote the benefits of using blockchain technology in administrative and financial processes in different areas.

This project designed to promote the development of local technologies also covers other areas, which may well participate to receive municipal support. Other branches in technological innovation that can compete are Artificial Intelligence (AI), Big Data, Cybersecurity, Virtual Reality, Cloud Computing, Biotechnology, Video Games, among others.

The statement also expressed the projects that must have a certain level of development to participate, since the authorities of Mendoza seek to create concrete results to promote and materialize the tool.

“They are looking for startups that can demonstrate a significant evolution in their business in six months, through concrete results. Projects will be selected with a degree of progress in disruptive industries that want to revolutionize the most traditional technologies (…) the municipality offers projects the opportunity to access the incubation/acceleration program and the co-working space of the Entrepreneurs Club”.

The organizers of the project created an official website where interested companies can make the necessary registration to participate. A form on the website expresses some essential requirements for registration. These requirements include the constitution of companies with no more than five years of creation. All participants must be over 18 years of age and they will not register multiple projects individually.

This is the third time that the Municipality of Mendoza conducts this type of project to promote the development of new technologies in different areas. However, it is the first time that it has worked together with Telefónica to obtain a greater scope.

The Open Future Network is a program of the Multinational Telefónica which seeks to support entrepreneurship and innovation in some countries such as Venezuela, Peru, Costa Rica, Brazil, Argentina, among others.

DLT or Distributed Ledger Technologies have a certain level of application in different functions such as in the establishment and creation of digital identity, document certification, product traceability, and various functions in crypto technology and digital currencies.

This could be an important step for the community of Mendoza to improve the work in different industries, thanks to blockchain technology.

By María Rodríguez

Less Than a Month before Bitcoin Halving, Google Search Results Show Venezuela

Alexander Salazar
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Less Than a Month before Bitcoin Halving, Google Search Results Show Venezuela

Venezuelans have shown strong search interest in the Bitcoin halving, according to Google Trends. That happens less than a month before the event takes place on the BTC network.

It is less than 30 days until the most important event on the Bitcoin network occurs. However, the search metrics on Google Trends are already giving interesting results for some nations such as Venezuela. It is important to remember that this country ranks fourth, regarding the volume of BTC traded throughout the history of LocalBitcoins.

The graph of ‘Bitcoin halving’, search results on Google Trends ranks the oil-producing country in 13th place, with a search interest of 39 out of 100. Therefore, Venezuela is the first country in the American continent to appear on the list, above the USA, which appears in 24th place as the second country in the hemisphere.

In recent days, the results for this query indicate the exponential growth in search interest in reducing miners’ rewards on the Bitcoin network, achieving the highest score of 100 in the first days of April.

Bitcoin has a fixed supply of 21 million units, of which miners have extracted more than 18 million in just over a decade. Miners from countries like China, Sweden, the USA, and Georgia have extracted 80% of the total current supply.

The Czech Republic, with smaller mining pools like Slush, also appears on the list of the main distribution of the most important miners on the Bitcoin network. China still plays a leading role there despite the migration of many companies to places that are friendlier with the activity.

Bitcoin Nodes in Venezuela

Among the European countries that dominate the ‘Bitcoin halving’, search result are Saint Helena, Luxembourg, Slovenia, Switzerland, and the Netherlands. The last one also ranks fifth among the main countries with Bitcoin nodes, according to data from Bitnodes.

Even though Venezuela is not one of the first countries regarding Bitcoin mining, many Venezuelans who adopted this activity are still committed to it. The almost null prices of electrical energy in the South American nation allow doing it, despite how insecure it can be. A couple of years, for example, there were numerous arrests of miners throughout the country.

According to Bitnodes, four of the five Bitcoin nodes established in the country are listening nodes that use the government telecommunications service CANTV to support the Bitcoin network. The remaining node uses a firewall to remain hidden and belongs to 18.60% of the nodes configured not to listen to the connections.

Google Trends

“Bitcoin halving countdown”, “Bitcoin halving price chart” and “Bitcoin halving clock” are current trends on Google as featured searches in the USA. Besides, the searches for cryptocurrency price prediction for the next halving are at the top of the ranking worldwide.

An increase in interest leads the community to expect the Bitcoin halving to add supply pressure when it begins around May 11th. Some analysts, who discuss the effects of the halving on the price, say that the event will have little or no impact.

One of the analysts predicting a moderate doubling in the price of BTC is James Todaro, head of research at TradeBlock. He believes that prices will increase after the halving to maintain miners’ economy.

By Alexander Salazar

Expert Investigation into Lawsuit against Bitcoin Banco by Order of Brazilian Judge

Alexander Salazar
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Expert Investigation into Lawsuit against Bitcoin Banco by Order of Brazilian Judge

The estimated debt of Bitcoin Banco to its users amounts to more than USD 600 million. Grupo Bitcoin Banco broke the law by not submitting documents about its accounting status.

A new episode of the proceedings against Grupo Bitcoin Banco led the court to prevent the company’s judicial recovery from continuing. Second instance judge, Espedito Reis do Amaral, ordered last April 8th to conduct an expert investigation to verify the actual status of the recoveries.

The estimated debt of Bitcoin Banco to its users amounts to 2.7 billion reais (nearly USD 638 million), according to the manager of the lawsuit established on November 27th, 2019. However, there is a possibility that the company will appeal against this amount.

A total of 31 people filed the lawsuit, which is a class action. They included Zater, the Brazilian exchange that GBB inaugurated some time ago, in the first description. However, it does not appear in the body of the sentence, which indicates that it is a mistake of the judicial system.

According to local media, the company says that the judicial recovery remains active and they will not appeal against the request. Therefore, it is rather a technicality of the law, since the decision is not on the suspension or not of such recovery.

This means that people will be able to continue enabling themselves during the proceedings. However, for the recovery to continue, the GBB will have to undergo exert investigation to verify that its companies are still in a position to rise and pay its creditors.

All this occurs because Bitcoin Banco did not submit the necessary documents to show its real accounting and financial status. In this regard, the judge of the Court of Justice of the State of Paraná (TJPR) considers that the Court should have granted the GBB the request, only after conducting an expert investigation on the financial health and economy of the company.

The Court will appoint the expert who will conduct the investigation, which will then analyze the viability of the company in both now and the past. This will be a way of evaluating whether customer payment is still possible.

Legal Decision on Bitcoin Banco

All these problems, as well as the accusations of fraud and the recovery request, have irreversibly damaged the image of the GBB. Consequently, no one else wants to invest his or her resources in that platform.

According to Amaral, despite not having any connection with the other judges, the conduction of prior expertise is the measure that will not cause losses to the parties.

On the contrary, the judge of the second instance stated that the measure would prevent judicial recovery from failing and the judicial apparatus from moving unnecessarily. He said that it is necessary to reform the aggravated decision comprehensively. This is because all the elements for Judicial Recovery need to undergo an analysis before he grants the judicial proceedings.

According to the judge, the professional that he appointed will have a maximum of 5 days to submit the document showing the debtor’s actual operating status and its documentary regularity. Immediately after that, the judge will issue the decision, without the parties’ hearing.

By Alexander Salazar

Third Halving of Bitcoin to Occur in Less than a Month

Alexander Salazar
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Third Halving of Bitcoin to Occur in Less than a Month

The next Bitcoin halving is scheduled to occur on May 12th. The reward will drop from 12.5 BTC to 6.25 BTC per mined block.

The Bitcoin halving is one of the events that the members of the ecosystem most anticipate in 2020. The mechanism will reduce the reward per block mined on this blockchain by half, which will affect the mining industry and could influence the price of Bitcoin. For this reason, the community is getting ready for the event, when it is less than a month until its activation date.

The halving is scheduled to occur on May 12th, at about 21:11:36 UTC, according to the website that keeps track of its count. The mechanism will be active when Bitcoin reaches the height of block 630,000, according to the programming in the blockchain code.

The halving mechanism, which is integrated into the Bitcoin network, is responsible for reducing the mining reward every 210,000 blocks. The event occurs every four years and it aim is to reduce the reward per mined block to 0 BTC by the year 2140.

This tool is programmed in such a way that Bitcoin is a deflationary currency since its issuance decreases over time and makes it a scarce commodity. In this way, as the demand for bitcoins increases over the years, the cryptocurrency theoretically becomes increasingly valuable in the hands of its owners.

This year, the reward per mined block will drop from 12.5 BTC to 6.25 BTC. Due to this, the community expects the halving to affect the income of the mining industry, which bases its profits mostly on the bitcoins that the network grants each time the network records a new block. In this sense, the miners and companies in the sector have been preparing for months before this hard financial blow.

On the other hand, some Bitcoin enthusiasts consider that the halving could lead to a rise in the price of the cryptocurrency. The network has previously recorded two other halving events, the first one in 2012 and the second one in 2016. On both dates, the price of Bitcoin began to rise even before the reduction of the reward by half occurred, since users perceive this event as a mechanism that revalues the cryptocurrency.

However, the current coronavirus pandemic affecting the economy worldwide has led to not very clear forecasts regarding the next Bitcoin halving, which does not allow predicting the behavior of the network.

Nic Carter, a financial analyst, considers that the cryptocurrency ecosystem should not pay much attention to the halving as it has no direct relationship to the price of Bitcoin. For that reason, the community could still focus their eyes on how this asset will behave, in the face of the challenges that the COVID-19 disease poses worldwide.

This world pandemic is an unprecedented situation that Bitcoin and other cryptocurrencies have had to face in the last few months. The community must observe the behavior of the main cryptocurrency, especially after the collapse that the global economy has been facing since the WHO declared coronavirus pandemic.

By Alexander Salazar

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