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Saturday, August 11, 2018

Virgin Bitcoin: Defined in CryptoCurrency

Virgin Bitcoin: Defined in CryptoCurrency



Virgin bitcoin is an amount of brand new bitcoin created by a computer that was mining. 

Mining is a computer process of recording and verifying information on the digital record known as the blockchain.

In bitcoin and other cryptocurrencies, mining also requires computers compete with each other to solve a complicated math problem.

A reward is given to the computer that solved the math problem first and this is known as virgin bitcoin.

A Bitcoin that has been received by a miner as a block reward, and thus has never been “spent” before. There is no benefit to a Bitcoin being a virgin Bitcoin.

Venture capital (VC): Defined in CryptoCurrency



Venture capital (VC): Defined



















Venture Capital:

ven·ture cap·i·tal ˈvenCHər ˌkapədl/ noun:
Venture capital (VC): Is invested in a project in which there is a substantial element of risk, typically a new or expanding business.

Definition: A venture capitalist: 

A Venture capitalist is a person who invests in a business venture(s), providing capital for start-up or expansion of a business and by method of giving USD currency.  Their business is to pool investment funds and find and invest in businesses that are going to provide their investors high rates of return. 


Posted - Dec 7, 2017: Jun 14, 2018: Venture capital (VC) is financial capital provided to start-up companies with currency. It comes either from individual investors or specialised venture capital funds

The idea behind venture capital is to gain equity in the start-up companies. Often, the start-ups pursue new ideas, such as in the Internet or in biotechnology.
 
Venture capital is money provided to new companies that hold a promise of long-term growth.

In exchange for the money, the companies will share ownership.

Because they are new companies and have no history of success, they usually have a higher risk of failure.

WolfGang Preston: Those firms hold crypto assets — most of which is in Bitcoin — in order to invest and divest in company tokens and cryptocurrencies as part of ICOs or just generally as retail investors do. ...
 

Bronson Teare: Venture Network is a very different animal to both traditional venture firms and to crypto funds.

Posted - Aug 16, 2018:  
Crypto hedge fund: Pantera Capital is seeking to raise $175 million for its third venture fund, a staggering three-fold increase from its previous fund target. ... Another is a venture fund that targets already-listed crypto assets, using machine learning as well as input from the fund's partners to optimize investments.


What is Venture Capital?


It is private or institutional currency investment made into early-stage(s) / start-up companies (new ventures).

As defined, ventures involve risk (having uncertain outcome) in the expectation of a sizeable gain.

Defined, Venture capital (VC) is money invested in businesses that are small; or exist only as an initiative, but have huge potential to grow.

The people who invest this money are called Venture Capitalists (VCs).

The venture capital investment is made when a venture capitalist buys shares of such a company and becomes a financial partner in the business.

All Venture capital (VC) investment is also referred to risk capital or patient risk capital, as it includes the risk of losing the money if the venture doesn’t succeed and takes medium to long term period for the investments to fructify.

Venture capital (VC): typically comes from institutional investors and high net worth individuals and is pooled together by dedicated investment firms.

It is the USD currency provided by an outside investor to finance a new, growing, or troubled business. 

The venture capitalist provides the funding knowing that there’s a significant risk associated with the company’s future profits and cash flow.

Capital is invested in exchange for an equity stake in the business rather than given as a loan.

This is why Venture capital (VC) is a suitable option for funding a costly capital source for companies and most for businesses having large up-front capital requirements which have no other cheap alternatives.

Software and other intellectual property are generally the most common cases whose value is unproven. That is why; Venture capital funding is most widespread in the fast-growing technology and biotechnology fields.


Features of Venture Capital investments:

  • High Risk
  • Lack of Liquidity
  • Long term horizon
  • Equity participation and capital gains
  • Venture capital investments are made in innovative projects
  • Suppliers of venture capital participate in the management of the company

Methods of Venture capital financing:

  • Equity
  • participating debentures
  • conditional loan

 

THE FUNDING PROCESS: 


Approaching a Venture Capital for funding as a Company:



The venture capital funding process typically involves four phases in the company’s development:

  • Idea generation
  • Start-up
  • Ramp up
  • Exit 

Step 1: Idea generation and submission of the Business Plan:


The initial step in approaching a Venture Capital is to submit a business plan. The plan should include the below points: 
  • There should be an executive summary of the business proposal
  • Description of the opportunity and the market potential and size
  • Review on the existing and expected competitive scenario
  • Detailed financial projections
  • Details of the management of the company

Businesses with low capital source must have a detailed analysis done of the submitted financial plan for venture partnering funds granted or loaned by the Venture Capitalist (VCs) to decide whether to take up the project or not.


Step 2: Introductory Meeting:


Once the preliminary business analysis study is done by the Venture capital (VC).

The (VC) judges the project as per their wants/needs of desired preferences, there is a one-to-one meeting that is called for discussing the project in detail after the submission is read over firstly.

This is when the business asking for Venture capital (VC) investor's financial backing becomes a win-all or fail and their presentation must be perfect.

After the meeting the (VC) finally decides whether or not to move forward to the due diligence stage of the process.

Step 3: Due Diligence:


The due diligence phase varies depending upon the nature of the business proposal given to the Venture capital (VC) for financial backing.

This process involves making solvent the queries related to customer references, product and quality of their business strategy evaluations, all management interviews, and other mediary exchanges of information during this time period among (VCs).

Step 4: Term Sheets and Funding:

If the due diligence phase is satisfactory, the VC offers a term sheet, which is a non-binding document explaining the basic terms and conditions of the investment agreement with possible punishments and rewards buried in legal jargon.

A businesses must be of an absolute legal sound mind by statutes and mediations of law in all regards before such ventures.

The term sheet is generally negotiable and must be agreed upon by all parties, after which on completion of legal documents and legal due diligence, funds are made available in partial and-or full.

Types of Venture Capital funding:



The various types of Venture capital (VC) are classified as per their applications at various stages of a business.

The three principal types of venture capital are early stage financing, expansion financing and acquisition/buyout financing.

The venture capital funding procedure gets complete in six stages of financing corresponding to the periods of a company’s development:
  • Seed money: Low level financing for proving and fructifying a new idea.
  • Start-up: New firms needing funds for expenses related with marketingand product development.
  • First-Round: Manufacturing and early sales funding.
  • Second-Round: Operational capital given for early stage companies which are selling products, but not returning a profit.
  • Third-Round: Also known as Mezzanine financing, this is the money for expanding a newly beneficial company.
  • Fourth-Round: Also calledbridge financing, 4th round is proposed for financing the "going public" process.

A) Early Stage Financing:


Early stage financing has three sub divisions seed financing, start up financing and first stage financing.

  • Seed financing: is defined as a small amount that an entrepreneur receives for the purpose of being eligible for a start up loan.
  • Start up financing: is given to companies for the purpose of finishing the development of products and services.
  • First Stage financing: Companies that have spent all their starting capital and need finance for beginning business activities at the full-scale are the major beneficiaries of the First Stage Financing. 

B) Expansion Financing:



Expansion financing is categorized into second-stage financing, bridge financing and third stage financing or mezzanine financing.


Second-stage financing: is provided to companies for the purpose of beginning their expansion.

The method of Second Stage Financing is also known as Mezzanine Financing.

It is provided for the purpose of assisting a particular company to expand in specific and a major way.


Bridge Financing: may be provided as a short term interest only finance option as well as a form of monetary assistance to companies that employ the Initial Public Offers as a major business strategy.

C) Acquisition or Buyout Financing:

Acquisition or buyout financing is categorized into acquisition finance and management or leveraged buyout financing.


Acquisition Financing: assists a company to acquire certain parts or an entire company. Management or leveraged buyout financing helps a particular management group to obtain a particular product of another company and at times can be agressive.



Advantages of Venture Capital:

  • They bring wealth and expertise to the company.
  • Large sum of equity finance can be provided.
  • The business does not stand the obligation to repay the money.
  • In addition to capital, it provides valuable information, resources, technical. assistance to make a business successful.

Disadvantages of Venture Capital:

  • As the investors become part owners, the autonomy and control of the founder is lost.
  • It is a lengthy and complex process.
  • It is an uncertain form of financing.
  • Benefit from such financing can be realized in long run only.


Exit Route:

  • There are various exit options for Venture Capital to cash out their investment:
  • IPO.
  • Promoter buyback.
  • Mergers and Acquisitions.




Examples of venture capital funding:




Kohlberg Kravis & Roberts (KKR), A top-tier alternative investment asset managers in the world, has entered into a definitive agreement to invest USD150 million (Rs 962crore) in Mumbai-based listed polyester maker JBF Industries Ltd. The firm will acquire 20% stake in JBF Industries and will also invest in zero-coupon compulsorily convertible preference shares with 14.5% voting rights in its Singapore-based wholly owned subsidiary JBF Global Pte Ltd. The fundingprovided by KKR will help JBF complete the ongoing projects.

Pepperfry.com, India’s largest furniture e-marketplace, has raised USD100 million in a fresh round of funding led by Goldman Sachs and Zodius Technology Fund. Pepperfry will use the fundsto expand its footprint in Tier III and Tier IV cities by adding to its growing fleet of delivery vehicles. It will also open new distribution centres and expand its carpenter and assembly service network. This is the largest quantum of investmentraised by a sector focused e-commerce player in India.

Validation Nodes: Defined in CryptoCurrency



Validation Nodes: Defined

























Validation Nodes are,

In TCP/IP Networking:

A node is a single stand-alone CPU/Computer running a specific software.

In Bitcoin Networking:

A node is a Bitcoin program which connects to other Bitcoin nodes, i.e. other Bitcoin programs on the same machine, or on other machines which can be across the street or on the other side of the planet.

There are several types and several versions of Bitcoin software.
By picking a specific version of a specific Bitcoin program, a user “votes” for certain changes in the Bitcoin protocol.







Example:

  • When bitcoin increases from 21 million total BTC to 42 million, the majority of the network is required to vote “yes” by installing the software implementing this change. 
  • Code changes are, thus, democratic.
  • The fact that there are very few Bitcoin nodes out there: a mere 10000 currently.
  • Neither number is very impressive from a global perspective. According to some calculations, running a Bitcoin node on AWS (Amazon’s cloud service) costs around $10 per month, and that is cheap.
  • To purchase 10000 brand new nodes takes $100,000 per month, andy $1.2m per year.
  • Regards any Bitcoin industrial miner company all gross in billions and unchecked by IRS should share the wealth, but are only greedy.
  • A list of node software you can install, along with their pros, cons, and special features, can be found here.
  • It’s important to note that validation nodes are purely an expense for the users running them. They give their users nothing.
  • CryptoCurrency nodes need around 500GB-to-1TB of disk space, 16GB-to-64GB of RAM, an uncapped internet connection with at least 1024kb of constant upload speed available just to run.
  • Currently, it is not uncommon to need to upload over 200 GB of traffic per month when running a single node.
  • Validation nodes are volunteer nodes.
  • Validation nodes are useful for the system’s decentralization.
  • Validation nodes become ever more expensive to run, and the number of nodes drop.
  • This mounting disillusion with Bitcoin’s theoretical decentralization due to the fact that bankers seem to have taken over the protocol’s of ASIC/Bitcoin.
  • The fact that Bitcoin’s price is being pumped by crime syndicates, government black projects, cabal of financial institutions.
  • with Bitcoin there is no surprise that the number of nodes dropped by 20% in a single month – from 12000 to 10000.
  • As more bitcoin nodes disappear, so does centralization.
  • This slow hostile takeover, becomes more and more obvious by the private financial institutions.
  • Private financial institutions always much to be admired.


Mining Nodes:

A mining node is a validation node which also uses the hardware of your own or a rented machine to guess the combinations of numbers and letters needed to validate and verify a block.

A mining node can team up with other nodes and send guesses to a common pool (pool mining) to increase chances of guessing, but then counts as only one node.






A mining node is the only bit of software which can “produce” new Bitcoin.

A cryptocurrency mining node is a network that resolves transactions needed to “seal” the cryptocurrency into complete coin blocks.

Validation-Nodes also processes emails, contacts, special sources of information, security checks, and produces new safe mediation of cryptocurrencies.

A validation node makes sure cryptocurrencies are all genuine coins, and passes the information along to other nodes, thus enabling the transfer of monetary value from location A to location B.


Mining nodes are a subset of other validation nodes on the cryptocurrency web-ring of servers, and every mining node is also a validation node and vise versa.




Unspent Transaction Output [UTXO]: Defined in CryptoCurrency



Unspent Transaction Output [UTXO]: Defined.




Unspent Transaction Output or UTXO, is defined as a list of money received that has not yet been spent. Bitcoin and other cryptocurrencies based on bitcoin’s technology use UTXO to verify that a person has unspent crypto available for spending.If you were to total up the UTXO, you would get the user’s available balance.























About UTXO's:


  • The Unspent Transaction Outputs / Also Known As / UTXO's are an interesting topic not spoken often enough in the bitcoin community.
  • An unspent transaction output (UTXO) is an output of a blockchain that has not been spent. -- i.e. used as an input in a new transaction.
  • Bitcoin is the most famous example of a cryptocurrency that uses the UTXO model.
  • Outputs are a superset of UTXOs.
  • UTXOs are a subset of the outputs superset.
  • Bitcoin UTXO lifespans have been studied.
  • Valid blockchain unspent outputs transactions may be used to effect further transactions.
  • The requirement is only unspent outputs may be used in further transactions is necessary to prevent double spending and fraud.
  • Inputs on a blockchain are deleted when a transaction occurs, whilst at the same time, outputs are created in the form of UTXOs.
  • These unspent transaction outputs can be used for the purpose of future transactions.
  • When bitcoin first became known, (UTXO), was considered pivotal.
  • Current day bitcoin community consider the HD wallets have no need understanding UTXOs as thoroughly.



What Is A UTXO In Present Day CryptoCurrencies?

  • A Bitcoin transaction is comprised of inputs and outputs.
  • Only Unspent Transaction Outputs, or UTXOs, can be used to be spent as an input in another transaction whereas spent outputs are already spent hence can’t be spent again. 
  • You will always need UTXO or an unspent transaction output to make a transaction workable.
    If you don’t have an  UTXO then you do not have any Bitcoin.
  • These are the protocol rules Satoshi Nakamoto had defined into Bitcoin to prevent double spending. 
  • There is no way in the bitcoin world to spend partial amounts while completing a transaction.

TA More In-depth Translation Is This: 

Problem: With a balance of 3 BTC on ‘XYZ’ public address and you pay 0.5 BTC to a merchant, you cannot send 0.5 out of your ‘XYZ’ address and keep the rest 2.5 BTC intact.


Solution: You need to spend the entire 3 BTC that you designate a 0.5 BTC to the merchant while providing a signature and sending the rest 2.5 BTC back to yourself on an address that you control.



Known-As: Sending $change to the change address.
  • In the dawn and beginning of Bitcoin a trader always made two transactions in your wallet when you pay someone. 
  • Yes, that’s true because modern wallets take care of everything behind the scenes.

When a bitcoin transaction takes place, there are two UTXOs created:
A.) One that is the actual coins sent to the recipient
...and...
B.) One that is the change output, which goes back to the sender’s wallet.


To clarify, the transaction above is done by the same person, confused yet?


This happens because HD wallets automatically send the change to a different change address so that you can secure your privacy. So next time you see your address changing, you know it is happening because you are receiving new UTXOs on a new change address!


Your Thoughts Are My Thoughts:

 

In earlier Bitcoin days, there were no deterministic wallets, BTC wallets used to ask for a change address if you were not the spending the whole balance in the initial transaction, failing which could result in your change being sent to addresses that you did not control resulting in loss of the transfering funds.



UTXO in depth:


  • More transactions means more memory for the UTXO database.
  • Many want to know what the UTXO database is.
  • UTXO is geek-speak for “unspent transaction output.” 
  • Unspent transaction outputs are important because fully validating nodes use them to figure out whether or not transactions are valid.
  • All inputs to a transaction must be in the UTXO database for it to be valid. 
  • If an input is not in the UTXO database, then either the transaction is trying to double-spend some bitcoins that were already spent or the transaction is trying to spend bitcoins that don’t exist.
  • The price of memory rises and drops every year. 
  • New memory chip technologies roll out we would still have the UTXO set growth outpacing the advance of technology keeping the not so wealthy poor.
  • Currently in 2018, the UTXO database is about 650MiB on disk, 4GB when decompressed into memory. DRAM costs about $too-much per GB, so you need to spend about $too-much on memory if you want absolute fastest access to the UTXO.
  • The UTXO continues to double and RAM prices continue to drop $% per year, next year you’ll have to spend about $more-Money.
  • Ten years from now may cost even more, perhaps.
  • The maximum block size will stop the exponential growth.
    A one megabyte block is room for about 100 million 500-byte transactions per year.
    If each one of these blocks increase in the UTXO then 500 bytes would grow in the UTXO Bd to 50 gigabytes a year. 
  • The worst case running nodes are those with not enoug ram.
  • More transactions with no changes would accelerate the UTXO Bd into more growth.
    With more UTXO Db growth will make purchasing RAM more expensive.
  • That is a very good reason to oppose increasing the maximum block size, because.
  • UTXO Db set does not have to be in DDR+RAM, but it can be stored on an SSD or spinning hard disk and the only reason why not is control over less wealthy.
  • The access of UTXO is not random.
  • The UTXO outputs recently spent will be re-spent outputs that have not been spent in a long time.
  • Bitcoin Core already has a multi-level UTXO cache, thanks to the hard work of Pieter Wuille.
  • Solid-state-disk (SSD) prices are about $to-much$ per GB, spinning disks are less $per GB$. 
  • Knowing how Bitcoin works is everything.

Unregulated CryptoCurrency: Defined

Unregulated CryptoCurrency: Defined

OptEditor: Crypto Uranus,
 

SEC says cryptocurrency exchanges are an unregulated mess:


  • The U.S. "Securities and Exchange Commission",(SEC), issued a warning on cryptocurrency exchanges.
  • The SEC Warns:
  • Many exchanges are unregulated and can do whatever they want with your money.
  • SEC assumes cryptocurrencies and tokens offered through ICOs are securities.
  • As securities, cryptocurrency exchanges should follow the same rules as exchange.
  • ICO's should register through the SEC as a national securities exchange, an alternative trading system (ATS) or a broker-dealer.
  • SEC says that current situation is a mess.
  • “The SEC staff has issued concerns many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not”.
  • The SEC wrote: “Many platforms refer to themselves as ‘exchanges,’ which can give the impressionism to investors that they are regulated or meet the regulatory standards of a national securities exchange.”
  • Many exchanges have set up their own rules when it comes to listing new cryptocurrencies, and ONLY SEC makes rules through private banks.
  • The SEC has no say, no regulation, no control, and no taxation methods for private banking families.
  • The SEC issues warning in this process that can not guarantee that those are safe investments.
  • The SEC never reviews trading tools on cryptocurrency exchanges. The exchange could give priority to bigger investors or screw up the order book without any consequence.
  • The SEC reminded cryptocurrency exchanges that they’re supposed to register as an ATS for example.
  • After Circle’s acquisition of Poloniex Nathaniel Popper saw a confidential Circle presentation.



Circle plans to work with the SEC to register Poloniex:

  • “The SEC is favorable on this approach and indicated that they would not pursue any enforcement action for prior activity,” Circle wrote. 
  • “They said we are the first and only company in the space to approach them, and were very progressive on working closely with us.”
  • So it seems like there could be a grace period for U.S.-based exchanges before an eventual crackdown. 
  • Many U.S. investors rely on foreign exchanges to trade cryptocurrencies.
  • It’s unclear how the SEC plans to protect U.S. investors from creating accounts on foreign exchanges.


U.S. Government SEC’s issued list of questions to cryptocurrency investors to help them pick an exchange:

  • Do you trade securities on this platform?  If so, is the platform registered as a national securities exchange (see our link to the list below)?
  • Does the platform operate as an ATS?  If so, is the ATS registered as a broker-dealer and has it filed a Form ATS with the SEC (see our link to the list below)?
  • Is there information in FINRA’s BrokerCheck ® about any individuals or firms operating the platform?
  • How does the platform select digital assets for trading?
  • Who can trade on the platform?
  • What are the trading protocols?
  • How are prices set on the platform?
  • Are platform users treated equally?
  • What are the platform’s fees?
  • How does the platform safeguard users’ trading and personally identifying information?
  • What are the platform’s protections against cybersecurity threats, such as hacking or intrusions?
  • What other services does the platform provide?  Is the platform registered with the SEC for these services?
  • Does the platform hold users’ assets?  If so, how are these assets safeguarded?



U.S. (SEC) Chairmen, and (CFTC) testifies before Congress:
Date: Tuesday, February 6, 2018.
Time: 10:00 AM.
Location: Dirksen Senate Office Building 538.
Subject: CryptoCurrencies.





The message we will likely get from the chairmen won’t be apocalyptic.


  • Fact is federal regulators have been thoughtfully on top of cryptocurrency issues for years.
  • If and when oversight is needed in digital currency markets then the power would best rest with the federal authorities and not the private institutions.
  • The SEC and the CFTC work overseeing digital currency.
  • The SEC shown several public sales of tokens inspired by bitcoin fit the definition of securities issuance, and should have been registered offerings.
  •  The SEC and the CFTC started with a thoughtful investigative report last summer opposed to a fusillade of enforcement actions.  
  • The SEC and the CFTC have since followed up with targeted enforcement actions. 
  •  The SEC and the CFTC have begun a process drawing a distinction between “initial coin offerings” that are securities on the one hand, and decentralized cryptocurrencies on the other.
  • Some cryptocurrencies are more suitably regulated as digital commodities as digital gold (bitcoin), digital fuel (ether), or digital real estate (filecoin/storj). 
  • The CFTC has already classified bitcoin and similar cryptocurrencies as commodities and it has, accordingly, been regulating derivative financial products, such as swaps and futures offerings from several exchanges, such as the CME, CBOE and LedgerX. 
  • The CFTC clarified that they have the authority to police cryptocurrency spot markets for fraud, market manipulation and insider trading — and investigations are underway. 
  • Cryptocurrency is not unregulated. 
  • There is, however, one thing that distinguishes a bitcoin spot market from a securities or commodities futures exchange: marketplace supervision.
    The SEC only supervises exchanges that trade in securities. 
  • The SEC has not determined all cryptocurrencies to be securities, and there are compelling legal and policy reasons why such sweeping classification is unreasonable. 
  • Who is the issuer of bitcoin? Miners? Software developers?
    This is like asking if gold is a security and then trying to determine who in the gold industry is the issuer of gold. 
  • Gold, a valuable asset that exists in the world independent of any promises from a third party issuer or promoter, is rightly classified and regulated.
  • Gold is as a commodity, just like bitcoin and similar cryptocurrencies are and should be. 
  • The CFTC, while it supervises commodities futures exchanges, only has after-the-fact enforcement authority over fraud in spot markets — it does not license and supervise those markets directly. 
  • The supervisory regulators of digital currencies are a historical accident, state-by-state money transmission regulators.
  • Digital currency exchanges must acquire a license in each and every state in which it has customers, comply with each different state’s differing regulations. 
  •  Digital currency exchanges explain their business to over 50 different regulators. 
  • If that seems odd and inefficient to you, you're not alone. 
  • In a recent joint op-ed for the Wall Street Journal, Chairmen Clayton and Giancarlo said they “would support policy efforts to revisit these frameworks and ensure they are effective and efficient for the digital era.”
    They’re right
  • State-by-state regulation of inherently global internet money transmitters is inefficient and hurts innovation, financial inclusion, consumer protection and American competitiveness. 
  • The big problem with respect to investor protection is that state money transmission licensing is focused pretty exclusively on solvency and custody risks, not markets.





Unbanked: Defined in CryptoCurrency

Unbanked: Defined:


Many reasons people may be unbanked including:

  • Unbanked are adults who do not or cannot use banks to store their money.
  • After experiencing a banking crisis, they may have a distrust of the banking system.
  • Some individuals don’t have enough money to meet the minimum requirements of a bank.
  • Illegal European Immigrants may not have the paperwork needed to open a bank account.
  • A small group of the unbanked are criminals who are trying to avoid the attention of law enforcement.
  • Some cryptocurrencies aim to help the unbanked by allowing them to store, use, and transfer their money with very few requirements.

























What is Unbanked really?


DEFINITION of 'Unbanked':

  • "Unbanked" is a slang term regards those who do not use banks or banking institutions in any capacity. 
  •  
  • Unbanked persons generally pay for things in cash or else purchase money orders
  •  
  • Unbanked persons also typically do not have insurance, pensions or any other type of professional money-related services. 
  •  
  • They may take advantage of alternative financial services, such as check-cashing and payday lending, if such services are available to them.



BREAKING DOWN 'Unbanked':

  • Estimated, 10 million American households are unbanked. 
  •  
  • Nationwide, about 7.7 percent of households are unbanked.
  •  
  • The rate of unbanked citizens vary greatly from one state to the next.
  •  
  • Mississippi has the highest rate of unbanked, at 16.4 percent. 
  •  
  • Rates of the unbanked in some U.S. cities and counties exceed 20 percent. 
  •  
  • These places include Detroit; Newark, N.J.; Cameron County, Texas; Laredo, Texas; Hialeah, Fla.; Miami; and Starr County, Texas. Unbanked rates exceed 40 percent in Cleveland; Savannah, Ga.; Nashville; and Atlanta. 
  •  
  • Half of the unbanked had a bank account previously, but are now choosing to conduct their financial lives without such exchanges do to interest rates and legal actions brought against them.  


Why Persons Become Unbanked:

  • Most unbanked are white, native-born Americans: but many immigrants, legal and illegal, are also unbanked.
  • People can choose to be unbanked for many reasons. Criminals avoid using financial institutions because law enforcement officials can track their actions in their accounts. 
  •  
  • Survived of global the Great Depression have deep distrust for financial institutions.
  •  
  • Great depression survivors do not trust, nor use private financial institutionalized banks. 
  •  
  • Recent immigrants who experienced banking crises in their countries of origin are the same consensus. 
  •  
  • Extremely poor individuals may also have no need for the banking system.
  •  
  • Those below and slightly above the poverty-line survive bearly day-to-day with little to no money for food and poor to no housing inthe United States.
  •  
  • Many citizens living in poverty find being unable maintaining minimum bank-account balances, to afford bank-account fees, or arrange for vehicle-transportation to and from bank branches during banking hours.

Initiatives to Help the Unbanked:


  • State and federal level politicians have attempted to help the unbanked gain financial literacy, benefit from banking services, and the banks fail them 93% time.. 
  •  
  • Former California Gov. Arnold Schwarzenegger’s, (AKA: Terminator), Bank on California Initiative, and the FDIC’s Money Smart program. 
  •  
  • The U.S. Treasury Department’s Section 326 regulations, which allow banks and credit unions to accept identification issued by foreign governments, seeks to help undocumented aliens become banked and to collect social-security benifits. 
  •  
  • The U.S. Treasury Department makes federal payments to unbanked federal benefits recipients using a MasterCard prepaid debit card.





TRUSTED VS TRUSTLESS: Defined in CryptoCurrency

TRUSTED VS TRUSTLESS:  Defined in CryptoCurrency

Truth in the means of stock-exhange and cryptocurrency operations



It means you don’t need a trusted party to settle transactions.
When you send funds you trust the banks to send it for you.
Settling a financial agreement between two parties involves both the bank of the sender as well as the bank of the receiver.

Cryptocurrencies like Bitcoin cut out the need of this middle man role.
It has nothing to do with trusting the seller. Neither does a bank if you pay upfront and the seller refuses to send the goods. Then it’s become a civil case.
Just like with bank statements you can prove on the blockchain that you transferred funds to the address the seller gave to you.



‘Trustless’ has become a rallying cry for Bitcoin evangelists, focusing public attention on the fact that Bitcoin enables P2P transactions without the participation of a trusted third party acting as an intermediary.

Before Bitcoin, to use digital money, we needed a trusted third-party to keep a ledger of who owned how much.  Examples of this trusted third-party are MasterCard, VISA, your bank or your MNO if you use mobile money. So if Alice sent Bob $100, this trusted third-party would debit Alice's account and credit Bob's account - they would update their ledger and we all had to trust this 'trusted' third-party to do the right thing and be good stewards of our money.

Now with Bitcoin, everyone has a copy of this ledger so we mo longer need to trust a single entity/organisation/third-party because there is no need to trust when you can just verify against this ledger because you have a copy of it. This decentralised ledger is called the Blockchain BTW.

And the other thing is that everyone using is following the same rules we are so we don't even need to trust them because we know that Bitcoin was built to make it impossible to break the rules.

Bitcoin makes it possible to conduct money transfers without intermediaries. Intermediaries who could otherwise gain control over funds in a transaction, censor transactions or act as points of failure. 

Does this give grounds to assert that Bitcoin and other cryptocurrencies are a form of money that does not require trust? Is it possible to completely eliminate trust from monetary relations, and is there even a need to? This article is devoted to the study of the role of trust in monetary transactions (including cryptocurrencies), and its main conclusion is that this role is hard to overestimate.

The article is divided into four sections. First, we analyze the role of trust in monetary relations, including the role of trust in Bitcoin’s functioning, and show that trust is necessary for any money. Next, we proceed to justify the need for credit and credit money, which cannot exist without trust.