Tag Archives: currency

What are colored coins?

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What exactly are colored coins? I’ve tried understanding, but I don’t quite get it yet . . . Do any examples exist?

via alternatives – What are colored coins? – Bitcoin Stack Exchange.

Colored coins are a method to track the origin of bitcoins, so that a certain set of coins can be set aside and conserved, allowing a party to acknowledge them in various ways. Such coins can be used to represent arbitrary digital tokens, such as stocks, bonds, smart property and so on.

The colored coins protocol is decentralized just like Bitcoin, but the current effort to develop an implementation is done under the BitcoinX project (tentative name), which also aims to provide some related services.

As this is still under development, you will not find any existing examples.

You can read more about it in Overview of colored coins (work in progress).

How the Bitcoin protocol actually works

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It may seem surprising that Bitcoin’s basis is cryptography. Isn’t Bitcoin a currency, not a way of sending secret messages? In fact, the problems Bitcoin needs to solve are largely about securing transactions — making sure people can’t steal from one another, or impersonate one another, and so on. In the world of atoms we achieve security with devices such as locks, safes, signatures, and bank vaults. In the world of bits we achieve this kind of security with cryptography. And that’s why Bitcoin is at heart a cryptographic protocol.

via How the Bitcoin protocol actually works | DDI.

Bitcoin Thefts Surge, DDoS Hackers Take Millions

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Bitcoin users have echoed that suggestion. “One note of warning: don’t trust any online wallet,” read a comment on a recent Guardian feature. “The two biggest ones have already been robbed. Use your own wallet on your own computer and back it up on a USB stick.”

“Remember, you don’t have to keep your Bitcoins online with someone else: you can store your Bitcoins yourself, encrypted and offline,” said Ducklin at Sophos.

via Bitcoin Thefts Surge, DDoS Hackers Take Millions – InformationWeek.

China’s State Press Calls for ‘Building a de-Americanized World’

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It’s not a new refrain: Back in March 2009, China’s central bank governor, Zhou Xiaochuan, also called for the creation of a new reserve currency, albeit in less heated language. The world needs a new “super-sovereign reserve currency” to replace the current reliance on the dollar, Zhou wrote in a paper published on the People’s Bank of China’s website (Zhou still heads the bank). The goal, he wrote, is to “create an international reserve currency that is disconnected from individual nations and is able to remain stable in the long run.”

via China’s State Press Calls for ‘Building a de-Americanized World’ – Businessweek.

As Bitcoin Soars in Value, Alternative Cryptocurrencies, Such as Litecoin and PPCoin, Also Climb

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Bitcoin transactions are verified by the work of software run by other people using the currency, a process that takes on average 10 minutes and can be much longer, an hour in the case of many exchange sites. Lee says that hinders operators of online stores from using the currency. “With Bitcoin, sometimes merchants are forced to accept unconfirmed transactions because confirmations are way too slow,” he says. “Faster confirmations lead to a more useful currency.” Litecoin transactions are confirmed on average every 2.5 minutes, which Litecoin’s developers say is more practical for businesses.

via As Bitcoin Soars in Value, Alternative Cryptocurrencies, Such as Litecoin and PPCoin, Also Climb | MIT Technology Review.