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Video talk: Blockchains vs databases




Watch a video of a half hour talk given at the CityChain17 conference in London this month, organized by MBN Solutions. Below is a list of the topics covered, with links to more in-depth information in brackets:

  • The basics of blockchains, compared to traditional messaging and centralized databases (more).
  • Dispelling some myths about how blockchains are different from, or better than, regular databases.
  • The key trade-off (disintermediation vs confidentiality) when considering using a blockchain (more).
  • An in-depth look at two proposed applications of blockchains, only one of which makes sense.
  • The four general categories of strong blockchain use cases that we know so far (more).
  • Platforms which call themselves “blockchains” but don’t fulfill the technology’s promise (more).
  • A brief description of the MultiChain open source blockchain platform (more).

I should also clarify that we’re not affiliated with IBM, but the conference was hosted at an IBM location.




Stimulus Money Invested in Bitcoin Yields Half of Tesla’s Gains



Negotiations over a new round of stimulus relief have dragged on for many months now. To make matters worse, both Democrats and Republicans have used the delay as a political ping pong to score points.

But last week, House Speaker Nancy Pelosi indicated that she and Treasury Secretary Steven Mnuchin are close to agreeing on a deal.

“We continue to be engaged in negotiations and I am hopeful we will be able to reach agreement.”

Then again, with no deal signed into law, the outlook remains uncertain. Jack Gillis, Executive Director of the Consumer Federation of America, expressed his worries over the deadlock. Moreso, how time is running out for many Americans concerning financial assistance programs.

“It is daunting to think about what the consequences will be for families, individuals, businesses, our economy when the COVID-19 protections and financial assistance are no longer available.”

$1,200 Direct Payout Now Worth

Markets are closely following developments in the stimulus negotiations, and for good reason too.

March’s historic $2.2 trillion package was the biggest in U.S. history. It included direct $1,200 cash payments to struggling Americans, as well as a raft of measures to help local government and private industries.

What’s more, Bitcoin rallied hard following the announcement. Investing the $1,200 payout in Bitcoin became something of a meme mocking the dollar’s decline.

Bitcoin daily chart

Source: BTCUSDT on

As it stands, $1,200 invested in Bitcoin back then would have doubled your money today.

However, figures from Ran Neuner, the Co-founder, and CEO of Onchain Capital, show the same amount into Tesla would have quadrupled your money.

Bitcoin Shows Signs of Decoupling From Stocks

This year has shown a high degree of positive correlation between Bitcoin and stocks.

The flashpoint came during March’s stock market crash, which triggered a 50% drop in the Bitcoin price. As a supposed safe-haven asset, Bitcoin failed to act as one when the stuff hit the fan, much to the dismay of crypto diehards.

Both Bitcoin and stocks, off the back of stimulus money, have since recovered.

However, recently, Bitcoin is showing signs of breaking its correlation with stocks. Last week saw two days straight of uncorrelated intraday performance, with Bitcoin rising as stocks fell.

Despite the apparent strength of stocks, analyst Willy Woo thinks they look vulnerable and predicts a stock market crash in the coming months. When that happens, Bitcoin’s decoupling will accelerate as its anti-inflation fundamentals come into play.

“The current stock market looks very vulnerable. If the plunge continues, Bitcoin will decouple from the stock market in the next few months. People will be surprised if that happens.After the Bitcoin halving and the amount of derivatives trading The reduction has fundamentally alleviated the selling pressure of Bitcoin against the bullish fundamentals of anti-inflation hedges”

Tesla’s performance this year is impressive, but how sustainable is it?

If Woo’s prediction comes true, those who bought Bitcoin using stimulus money would appear to be investment geniuses.


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North America and Europe Control 88% of All Lightning Network Nodes, Research Finds



As Bitcoin adoption grows more and more, concerns about the need for scalability solutions increase. Lightning Network is the most important layer-two development currently available on the Bitcoin blockchain, and it seems that North Americans are the favorite demographic for this efficiency-focused micropayment solution.

The Lightning Network is a layer-two solution currently under development. It focuses on the creation of channels between peers that allow for almost instant and extremely cheap transactions without the need to record it on the blokchain. The money is locked on a wallet in order for it to be available on the Lightning Network, and once a user needs to have its tokens on the Bitcoin blockchain, the channel is closed and the blockchain registers one transaction from the original wallet to the final one without registering what happened in between.

Graphic representation of how the Lightning Network works. Image: TheBlockPro
Graphic representation of how the Lightning Network works. Image: TheBlockPro

North America and Europe Rule the Lightning Network

According to a report from the University of Vienna, 45% of all Lightning Network nodes run in North America, with a large majority in the United States. Lightning Labs, the leading developer of this scaling solution, is registered in that country. Blockstream, Bitcoin’s largest development company, is registered in Canada.

Europe is the second region on the list, with 43.1% of the world’s nodes. The rest of the nodes are distributed among Asia (6.2%), Oceania (2.2%), with South America and Africa sharing a small fraction of 0.8% and 0.6%, respectively.

The contrast between the number of nodes and the adoption of Bitcoin is remarkable. Latin America has a high adoption rate of Bitcoin, according to data compiled by Chainalysis. However, it has just under 1% of Lightning Network nodes. Africa is also showing a similar picture, with a high volume of trading and adoption, but with little interest in the micro-payment system.

Channels Share Cultural Ties

Another important finding is that Lightning Network has become very popular in large urban centers. Researchers believe that this is mainly due to the better infrastructure and connectivity, which facilitates the operation of the nodes:

We could observe that LND is popular in almost all countries and also showed that within a country nodes form clusters around cities and expand into their metropolitan areas. Also infrastructure plays a significant role in the distribution of nodes within a continent or country.

They also realized that many of the nodes open channels with peers who speak the same language or have similar cultures. For example, 80% of Argentina’s payment channels are shared with Uruguay, 10% with Peru, and about 4% with Chile and Venezuela.

Most of the nodes are from large cities in Europe and North America. Image: University of Vienna
Most of the nodes are from large cities in Europe and North America. Image: University of Vienna

A similar cultural phenomenon happens in other latitudes: Kenya, for example, shares more than 70% of its channels with South Africa, while China has to share channels with Taiwan and Hong Kong, Croatia with Czechia and Bulgaria and Mexico with Colombia, Chile, Puerto Rico and Argentina.

Ethereum Grows Faster Than The Lightning Newtork

Despite being overshadowed by the DeFi hype, Lightning Network continues to grow steadily. According to data from the Lightning Network tracking site 1ML, there are currently over 14200 Lightning Network nodes in operation. The network has a capacity of over 1039 BTC.

Some of the Real-Time statistics of Bitcoin's Lightning Network. Image: 1ML
Some of the Real-Time statistics of Bitcoin’s Lightning Network. Image: 1ML

However, these statistics were recently exceeded by a somewhat heterodox solution: The number of synthetic Bitcoin tokens running on the Ethereum network already exceeded the total value of tokens moving on the Lightning Network.


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Beware: Latest Ledger Email Phishing Scam Making The Rounds



Consumers who have purchased Ledger hardware wallets have been waking up to nasty emails claiming that their crypto assets are in danger of being stolen. It is the latest in a long list of phishing attacks designed to lure the uninitiated into divulging their secret phrases or downloading malware.

The first round of spurious emails was asking for the 24-word recovery phrase and Ledger responded with a warning emailed to customers confirming that it would never ask for this.

The second round of emails is a little more insidious as they claim that a data breach on Ledger servers has affected the wallet associated with the target email account. It asks users to download the latest version of Ledger Live, via an email embedded link, and reset their PIN numbers.

It was reported that Ledger did suffer a data breach in July resulting in 9,500 users having their personal information compromised.

Ledger scam email

Sneaky Social Engineering

On initial glance, the email looks genuine but there are a number of key giveaways that are easy to spot for the trained eye. Firstly, the domain name is not from but

Secondly, hovering over the link in the box (but being careful not to click it) reveals a dodgy URL; which is likely to result in the downloading of malware which may be able to log keystrokes, steal credentials, or mine cryptocurrency.

Crypto investors and traders have already taken to twitter to share this phishing scam and warn others about it;

Additionally, Ledger itself has published a list confirming knowledge of these phishing attempts and reinforcing the premise that funds are safe providing the recovery phrase is;

The company stated that nobody, including Ledger, should ever ask for the PIN number of recovery phrase, but this latest email was a call to action prompting the clicking of a malicious link.

Risk Mitigation

Hardware wallets, such as those produced by Ledger or Trezor, take an extra step to mitigate these risks. Ledger stated that crypto assets cannot be sent from a Ledger device unless the user physically connects it to the computer and verifies the transaction on both the computer and the device.

If malware is controlling the PC or smartphone, it cannot control the Ledger wallet, even when it is plugged into the computer.


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