The charges brought against Steynberg and MTI are the most recent moves carried out by the agency, which stated in May that it was allocating additional resources to keep a closer eye on the cryptocurrency sector.
The Commodity Futures Trading Commission has filed a case against Cornelius Johannes Steynberg and Mirror Trading International Proprietary Ltd, claiming that the global multilevel marketing operation "misappropriated" all of the bitcoin it accumulated.
The CFTC stated that the scam, in which the company solicited bitcoin online from thousands of individuals to ostensibly operate a commodity pool, was the largest fraud involving Bitcoin it has ever investigated.
Although some digital currencies predate Bitcoin, they did not earn substantial adoption. It is a digital currency, as opposed to fiat currencies such as the British pound, U.S. More specifically, Bitcoin was the first digital currency to scale.
Any contract is able to implement the selfdestruct(address) function, which removes all bytecode from the contract address and sends all ether stored there to the parameter-specified address. If this specified address is also a contract, no functions (including the fallback) get called. This means, any attacker can create a contract with a selfdestruct() function, send ether to it, call selfdestruct(target) and force ether to be sent to a target contract. This is inclusive of contracts without any payable functions. Martin Swende has an excellent blog post describing some quirks of the self-destruct opcode (Quirk #2) along with a description of how client nodes were checking incorrect invariants which could have lead to a rather catastrophic nuking of clients. Therefore, the selfdestruct() function can be used to forcibly send ether to any contract regardless of any code that may exist in the contract.
There is an RSK/ETH federated peg as well. A federated bridge consists of a set of functionaries that participate in a multi-signature custody of the pegged assets. The Liquid Bitcoin sidechain has a federated peg.
Bitcoin also provides opportunities for diversification, as market research shows Bitcoin has repeatedly displayed a low correlation to other asset classes. (Retrieved 14 May 2019 - PDF Link) In other words, Bitcoin prices don't generally follow the fluctuations associated with other asset classes such as stocks and bonds.
This can be done amongst peers with systems such as commit-reveal, or via changing the trust model to a group of participants (such as in RandDAO). Block variables (in general, there are some exceptions) should not be used to source entropy as they can be manipulated by miners. The source of entropy (randomness) must be external to the blockchain. This can also be done via a centralised entity, which acts as a randomness oracle.
In a collateralized bridge, the functionaries (called "vaults") have full access to the private keys that control the bitcoins, but they need to deposit a collateral so if they steal the bitcoins in the peg, they are penalized by slashing their deposits. The amount of collateral must be greater than the pegged assets (overcollateralization) to prevent theft. One example of a collateralized bridge is PolkaBTC, which connects Bitcoin with Polkadot. It’s surprisingly capital inefficient. If the collateral value is not enough because of rapid variations on the relative coin prices, an automatic liquidation process occurs. The consequence of this is that the collateral value must be much greater than the value of the whole economy enabled by the pegged asset.
By adding the adjective "maximally decentralized" to the definition we try to force sidechains to preserve the Bitcoin security model and bitcoin prevent a centralized ledger to be called a sidechain. Apart from the Gresham’s argument, if we let the sidechain have a token for bridge collateralization, then some chains such as Polkadot, become Bitcoin sidechains, even that’s very far from the original sidechain meaning. However, that would probably force us to drop the incentive alignment part, because all two-way-peg bridge protocols invented so far have security models that are strictly less decentralized than the blockchains they connect, especially when compared to Bitcoin’s proof-of-work consensus. A bridge that accept anonymous participants using another token as collateral may be more decentralized, but a a lot less incentive-aligned with Bitcoin
. So, btc to keep the original meaning, a sidechain should not support any other tradable token that tries to be money.
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