Understanding the way payments work is quite revealing in some cases. as it explains how a handful of companies make money off millions of transactions around the world. For example, very few people are aware of how PayPal is making a ton of money through their BrainTree hub, which is used for mobile payments by services such as Uber and AirBnb. A lot of revenue is generated for this one company powering a lot of payment options all over the world, and this type of centralization is not good news.
Also read: OmniDex: Keeping You From Getting Goxxed?
PayPal And BrainTree Power Your Mobile Payments
Very few consumers are aware of which services are responsible for processing credit and debit card payments all over the world. Especially when it comes to mobile payments, there seem to be very few companies who can gain any significant traction. BrainTree is one of the most profitable companies, which is paying dividends for overarching company PayPal.
In fact, PayPal is one of the most popular payment processing firms in the world today, thanks to their various services. Most people know PayPal itself as a way to send money all over the world by using plastic cards and bank accounts, but there is much more to this company than processing payments themselves.
Among the subsidiaries of PayPal are companies such as Venmo and BrainTree. The millennial generation will be well aware of the existence of Venmo as this solution lets users split bills and transfer money by using a mobile device. Venmo is used by various retailers around the world, including Papa John’s.
BrainTree, on the other hand, is lesser known by most people, even though it is one of the most commonly used payment processors in the world. Companies such as Airbnb, StubHub, and Uber are all making use of BrainTree to process card payments, which bring additional revenue to PayPal as a company.
Distinguishing between companies and services with the same name is important. PayPal is both a payment processing company and a payment processor itself, despite having other subsidiaries which are also focusing on processing payments. At the same this, Venmo and BrainTree are bringing more functionality to PayPal as well, and these new features might be showing up on the Paypal platform in due time.
Centralized Payment Processing Companies Are Not Good
While it is interesting to note the PayPal company owns so many different payment processing tools, it is also slightly worrying to know a lot of payments are handled by the same group of people. This removes a lot of potential competition from the market, as these traditional solutions are all part of the same umbrella.
But there is some positive news for Bitcoin users, as BrainTree is accepting Bitcoin payments in some capacity. However, it remains up to individual sellers and businesses to enable the Coinbase integration into their platform, an option which is not gaining any significant traction just yet.
What are your thoughts on the PayPal company handling payments for so many different platforms? Let us know in the comments below!
Images courtesy of PayPal, BrainTree, ShutterstockThe post PayPal Centralizes Payment Processing For Uber And AirBnb appeared first on Bitcoinist.net.
4 March 2016 – You can now donate your Bitcoin to charity by playing Pokemon. Strange as it sounds, it’s been made possible by Jordan Hall, Rapid Web developer, using popular streaming site Twitch.tv. The stream emulates the wildly successful Twitch Plays Pokemon, with a key difference. You need bitcoin to control the character’s in-game actions. This is achieved by linking incoming transactions of an address to a Game Boy input – you donate any amount to the address corresponding to the input, and the character acts according to each donation. QR codes are provided to make the process easier for those on mobile devices.
Also Read: Valve is Bringing Bitcoin to Over 125 Million Steam Users Worldwide
Bitcoin Plays Pokemon is First to Integrate Donations into Gameplay
Each donation is integrated into gameplay via the bitcoin transaction hook, and the first of it’s kind on twitch.tv, as well as being the first bitcoin charity event on twitch to my knowledge. This is a creative use of bitcoin in the first place, and the fact the proceeds are going to charity is icing on the cake. For those shouting nay because of potential for fraud, or equally horrible, transaction spam coming from the stream, Jordan has you covered. The default amount on the QR codes is too large to make spam cost-effective, but small enough to make a move in the game trivial. Furthermore, the addresses are public on the blockchain, as are all bitcoin addresses, meaning We’ll all know pretty fast if that money doesn’t end up in the hands of charity. Worst case scenario it generates enough traffic to burden the network, but those transactions won’t continue like spam attacks will, because the bitcoin isn’t sent over and over. And maybe, just maybe, spam caused by charity donations is better than spam for malicious interests.
Funnily enough, the model used by Bitcoin Plays Pokemon fixes the biggest problem with Twitch Plays Pokemon – the overload of spam inputs. The barrier to making an input, albeit small, will likely make for a better playthrough. If you planned on donating Bitcoin to a charity anyway, this is certainly a much more fun way to do it. This is also the first major development for twitch.tv since their integration of ChangeTip more than a year ago, and hopefully, this stream is the first of many to make way for third-party Bitcoin adoption on their streams and services.
What would get you to donate your Bitcoin to charity? Let us know in the comments!
Images Courtesy of Bitcoin Plays PokemonThe post Bitcoin Plays Pokemon lets you Play by Donating BTC to Charity appeared first on Bitcoinist.net.
Coin Center research director Peter Van Valkenburgh discusses bitcoin’s involvement in a new string of ransomware attacks.
Last week, the Omni Foundation announced the release of the OmniDex 1.0, a trustless cryptocurrency exchange. The Omni Foundation claims that their exchange is the first of its kind, bringing truly-decentralized trading through a platform that “has no human component.” The purpose of this exchange is secure and trustless trading; OmniDex wants people to be able to buy and sell without getting “Goxxed.”
Also read: Visa Is Looking for Blockchain Developers
OmniDex: Trustless Cryptocurrency Exchange
OmniDex users will be able to buy and sell six of the top 36 tokens built on the Omni protocol:
Omni Foundation board member Patrick Dugan sat down with us to discuss the Omni Foundation, the Omni protocol, and the new OmniDex 1.0 exchange.
Tell us a little about the Omni Foundation.
We were founded in late 2013 to house the capital raised in the first crowdsale over the Bitcoin blockchain, prior leadership made some mistakes, hiring too many people when we were flush, not hedging BTC value, lack of a proper technical roadmap for the first 8 months, so we didn’t deliver on our promises as fast as OMNI investors would have liked. For most of 2015 we slogged on with almost no funding, with the remaining leadership (Craig Sellars and I) paying things out of pocket to keep it going, but I got us recapitalized last October and now 30 months later we’ve delivered.
We are a non-profit organization incorporated in Delaware and Panama, chartered to fund development, provide market making liquidity and supporting entrepreneurs in frontier markets. We are currently sponsoring Alakanani Itireleng in Botswana, Chernow Sow and Mustapha Cole in Sierra Leone, and Phillip Asare in Ghana, because that’s how the rules work for foundations (5% of assets donated per year), because I like it, and because practically speaking, promoting this tech to System D, to the people who need it the most, is the best way to go.
What is the purpose of the Omni Protocol?
To create an asset layer over Bitcoin, enable trustless trade of those assets using automatic escrow logic, and ultimately deliver the world a financial system that can serve everyone.
Can you give us a basic overview of OmniDex?
Since 2014 we have supported trade of BTC directly for OMNI, formerly known as Mastercoin, which is the token that is the first asset on the layer and meant to be able to serve as collateral for smart contracts and transform into any pegged currency with a decent data feed behind its price. The way that worked, we had a multisig set-up, you’d reserve your OMNI to put up a sell offer, someone would come and send a transaction reserving some portion of that offer, and then after that confirms you’d have to send the BTC. After that 2nd transaction confirms, then the multisig would release the OMNI to the sender.
What we just activated last week is the next phase of the Dex, where OMNI can trade against some of the rad properties that have been issued over the layer in the past 2 years: MAID, AMP, TAU, Tether USD. About 55M USD worth of assets at this moment, that’s about to go up as we see the world’s first blockchain Real Estate assets out. We’ve improved how we do transactions, embedding data in the OP_Return codes that Bitcoin Core devs came up with as a compromise on the issue of blockchain bloat. Since all the assets are in the protocol, the logic about clearing limit orders to a buyer is more direct, it all happens in one transaction, with the enforcement of the rules embedded into how OmniCore nodes parse the Bitcoin blockchain.
Currently only OMNI can be traded against a given asset, and it’s all free to do except for tiny bitcoin miner fees which come with the territory of broadcasting on Bitcoin. In version 0.11 which we are pushing to release in April, we will have a very elegant fee system, where liquidity takers get .05% taken out of their order, and once the sum of fees for a given property is enough that everyone with at least 1 OMNI can get at least .00000001 of that property, it’ll show up on the addresses of all OMNI holders. There are about 605k OMNI, and that’s it forever, so .00605000 in fees, or every time an asset trades 12 units aprox, fees hit the OMNI holders. Putting up a limit order and getting it filled carries no fee. Then you could trade Tether USD against Tether EUR, or USD against MAID, or any combination you like. As a market maker, this exponential amount of combinations is a bit heady to update limit orders for and arbitrage any opportunities, but that’s why I taught myself how to program.
If OmniDex has no human component, how do glitches or bugs get resolved? Is there any kind of customer service provided by the Omni Foundation?
Yes, the game plan is to keep at least one developer and myself working on applications and compatibility with upstream merges as Bitcoin Core advances, in perpetuity. I profitably deploy automated trading systems, mostly arbitrage, to ensure that. Our core devs are also top-flight in thoroughness, they employ unit tests in code, regression tests for features, and we tested the Dex for months on testnet before we activated, sussed out a few bugs, made sure it could scale in terms of throughput, latency, mathematical consistency. This is how we proceed every time we add something significant. It’s also open-source software.
We also have some more folks working in other capacities that are taking feedback on usability and incorporating that into educational efforts, polishing up our web wallet (Omniwallet), and a lot of us have UX background so we take that seriously. We’ve given away a lot of unpaid consulting hours to help businesses use the protocol, and we’re always willing to listen to user concerns.
I saw that this release is OmniDex 1.0, implying that there will be more versions of the platform in the future. Are there already plans in the works for future versions,
While the bitcoin network’s capacity challenges generated substantial visibility this week, the digital currency enjoyed robust trading volume.
Coinbase CEO Brian Armstrong has issued new comments criticizing the Bitcoin Core development team, reiterating his support for Bitcoin Classic.
Coinbase CEO and co-founder Brian Armstrong recently published a Medium blog post titled, “What Happened At The Satoshi Roundtable.” In this post, Armstrong calls for an immediate block size increase to 2 MB, the creation of a new Bitcoin development team, and called the Core team a “systematic threat” to Bitcoin.
Also read: IOTA: Internet of Things Without the Blockchain?
Coinbase CEO: We Need a New Development Team
The post started as an overview of the failure to reach consensus at the most recent Satoshi Roundtable meeting in Florida. However, Armstrong quickly transitioned into an attack on the Bitcoin Core developers, arguing that they are impeding the progress of Bitcoin:
“The conversations initially focused on various compromises that could be made to kick the can down the road on scalability. But as the conversations went on, I became less and less concerned about what short term solution we pick because I realized we all had a much bigger problem: the systemic risk to bitcoin if Bitcoin Core was the only team working on bitcoin.”
Armstrong launched 3 major arguments against the Core development team, saying that while they are very smart people, they:
“Show very poor communication skills or a lack of maturity
“Prefer ‘perfect’ solutions to ‘good enough.’ And if no perfect solution exists they seem ok with inaction
They believe that Bitcoin “will not be able to scale long term,” and that “any block size increase is a slippery slope to a future that they are unwilling to allow.”
Attacking the Core team’s “perfect” solution, segregated witness, the Coinbase CEO admitted that it “is a well done piece of technology,” but believed that it would be a risk to use it as a scaling solution due to current circumstances in the Bitcoin ecosystem.
Specifically, Armstrong was worried about the upcoming block reward halving in Summer 2016. He said that, once the halving occurs, the cost of mining a block will rise to $500 USD. If the market price of bitcoin remains at current levels, then Armstrong fears that a large portion of the mining network will go offline due to hardware becoming unprofitable.
Armstrong argued that such a large drop in hashrate would cause the entire network to become incredibly slow as full blocks are met with only a few miners. In a “worst case” scenario, this decline in miners could increase confirmation times to a point where each block would be at 140% capacity, and the network would “start accumulating a backlog.”
In order to avoid such a frightening scenario, Armstrong argued that we need to take “a path forward” that accomplishes 3 major goals:
An immediate block size increase to 2 MB.
“Communicate with the Chinese miners about this upgrade path.”
“Long term, we need to form a new team to work on the bitcoin protocol.”
The Coinbase CEO’s fears about the future of Bitcoin are not isolated. After a large increase in transaction times for several days this week, some people in the community worried that slow transactions would become the “new normal” for Bitcoin. Although the network eventually sped back up, the fear about full blocks remains.
What do you think about Brian Armstrong’s reaction to the Satoshi Roundtable meeting? Let us know in the comments below!
Images courtesy of Coinbase and PixabayThe post Coinbase CEO: Core Team is a “Systematic Threat” appeared first on Bitcoinist.net.