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MIT Review Report says Quantum Computers Aren’t a Danger to Bitcoin

MIT Review Report says Quantum Computers Aren_t a Danger to Bitcoin

With his latest opinion piece for Technology Review, Sankar Das Sarma, a physicist from the University of Maryland has brought a sigh of relief to the global crypto community. Shunning the overhyped speculations for Quantum Computing, the expert in his detailed article has clarified that quantum computing is far away from a stage where it can intrude into the decentralized blockchain ecosystems like Bitcoin. The physicist emphasized that quantum technology is still not at a level required to trace down the public key cryptography which forms the core infrastructure of crypto projects.

As shared by Sarma, the cryptography used in Bitcoin is likely to remain risk-free and impenetrable from quantum computing. He mentioned that Quantum Computing has gained unexpected popularity amongst people and has emerged as the second most talked-about terminology for the GenZ after Artificial Intelligence. Despite the constant fund flow for the research and development operations in the quantum field from tech giants like Microsoft, Alphabet, Amazon, etc. there has been no substantial development in the sector when it comes to product launch.

The expert confirmed that there are multiple applicational uses for quantum computers such as the use of the technology for finding prime factors of large numeric values at a higher speed than the traditional tools. He explained that this remains the prime focus of breaking RSA-supported cryptography which is used for emails and crypto transactions. The quantum computing realm has received critical attention and capital flow from government authorities worldwide. He skeptically remarked that what remains, in theory, need not find its way into practice easily.

Talking about the present issues, Sarma revealed that the present quantum computers have plenty of noise-making physical qubits that are used for a process called quantum error correction. A computer that can decode the RSA cryptography world needs many millions/billions of qubits. The use of private keys offers incomparable security to transactions for users. Interestingly, a private key can connect with a compatible public key quaickly, however, it is next to impossible to decode a private key merely by knowing a person’s public key alone. This makes it essential for the users to keep their private keys safe from others. When investors do not act smart while hiding their private keys, they lose their funds to malicious intruders.

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Florida To Support Bitcoin Payments For Tax Collection

Florida To Support Bitcoin Payments For Tax Collection

With cryptocurrencies becoming the mainstream financial tool for investors, governments from across the globe are striving to incorporate them into the core infrastructure. The latest to join this bandwagon is Florida where the government is looking forward to accepting tax payments in cryptocurrencies from the local citizens of the state. Governor Ron DeSantis revealed that the government authorities in Florida are working to support Bitcoin payments for tax purposes so as to ease the people from the burden of complicated traditional tax channels.

During his interaction at a press con in Wesley Chapel, Governor DeSantis stated that he has instructed the agencies to start the exploration of multiple solutions supporting the highly-anticipated digital switch in the tax payment structure. The conference was held to celebrate the signing ceremony of a financial literacy curriculum bill that will include personal finance education for high school graduation programs.

Interestingly, DeSantis has always been an ardent supporter of cryptocurrencies. Earlier in December 2021, he proposed to add support for crypto payments in the settlement of state taxes by local business firms. He advised to allocate funds for nurturing projects related to blockchain technology, however, the proposal did not receive a green signal from the legislature.

DeSantis, who is a potential candidate for the 2024 Republican presidential elections shared a skeptical stance towards Joe Biden’s executive order on cryptocurrencies. He highlighted that there is a significant difference between a blockchain-based digital asset like BTC and digitalization of USD or conversion of the currency into a digital form wherein the assets continue to remain under the control of the regulator.   

Well, this is not the first time for a U.S state to show interest in cryptocurrencies for tax procedures. Recently, Colorado emerged as the first US state to accept cryptocurrencies for settling tax payments from the natives. As part of the initiative, crypto payments would be equalized to the USD value of the tax payable. The digital tokens would then be converted into USD before deposition on the state treasury. The authorities addressed the initiative as a logical path to digital statehood. The decision is likely to be enforced from June 2022. Also, Francis Suarez, the mayor of Florida’s Miami became the first major US politician to accept his salary in Bitcoin tokens.

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Salvadoran Chamber of Commerce Reports 14% of Businesses Using Bitcoin Transactions

Salvadoran Chamber of Commerce Reports 14% of Businesses Using Bitcoin Transactions

In addition to digitizing the economy and reducing dependency on US dollars, Bitcoin adoption would also reduce transfer expenses — which currently account for about a quarter of the Central American country’s gross domestic product (GDP) and stimulate investment.

A national demonstration of cryptocurrency’s transformational power could occur in El Salvador for the first time. Officials of the country’s finance department endorsed a report published in January this year stating that over the previous several weeks, at least 4 million users – nearly all of the country’s inhabitants – had authenticated themselves as actual users of the government’s digital wallet.

In an IMF board resolution, it was suggested that El Salvador should disregard Bitcoin as a legal tender due to its significant risks, highlighting one of the main barriers to receiving a loan from the IMF. Last year, El Salvador sought a $1.3 billion IMF loan, but discussions have been stalled by the lender’s concerns about Bitcoin, and any program would be subject to board approval.

Bitcoin has been adopted as legal tender in El Salvador, Nayib Bukele, President of El Salvador,  has advocated for the increasing adoption of digital currency for many years. The El Salvadoran chamber of commerce recently conducted a poll that showed that despite Bukele’s efforts to promote Bitcoin use, the majority of companies in the country are not using it. Since El Salvador’s government approved BTC as legal tender in September, only 14% of survey respondents have used it as payment.

Moreover, a substantial percentage of respondents didn’t perceive an impact on their sales as a result of adoption. Introducing the Bitcoin law in June of last year, Bukele made a huge promise to his constituents.

The Chamber of Commerce reported to the state that only as low as 14% of respondents had transacted in Bitcoin since the country became the first in the world to recognize the digital token as legal tender in September.

Over 90% of 337 companies who participated in a survey between January 15 and February 9 stated that Bitcoin adoption in the country had little to no impact on their sales. 71% of the businesses surveyed were classified as micro or small, 13% as a medium, and 16% as large, according to the survey.

Alejandro Zelaya, El Salvador’s Finance Minister, announced that despite lukewarm reactions to Bitcoin since its launch, El Salvador plans on launching what would be the first state-backed Bitcoin bonds in the next few days.

He told Bloomberg he expects that bond to be issued through LaGeo, the state utility company. Samson Mow is a former Blockstream engineer who recently left the company to consult on nation-state Bitcoin adoption. 

If you want to know all there is to know about cryptocurrencies and blockchain technology, the Blockchain Council’s extensive certifications are for you. The certifications provide subjective and practical information in an easy-to-understand format. They are affordable and provide you with immediate exposure to the developing industry.

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SegWit vs Native SegWit (Bech32) : A Comprehensive Guide

SegWit vs Native SegWit (Bech32) A Comprehensive Guide

Before proceeding with our debate of SegWit vs Native SegWit (Bech32), let us learn about the fundamentals of segregated witness address, abbreviated as SegWit and native segregated witness address, better known as Bech32 or Native SegWit.

While adding a Bitcoin account, a ledger user is usually presented with two options in the beginning. The first is a Native SegWit and the second one is SegWit. However, there are certain differences between the two address formats.

In this detailed blog, we will take you through a comprehensive guide discussing the two terms in detail while understanding the fundamental difference between them.

What is SegWit?

In our discussion of SegWit vs Native SegWit (Bech32), let us take a start with the conceptual meaning of SegWit. The total digital signatures constitute almost 65% of the total space on the blockchain. This situation is for any given transaction on the blockchain. A segregated witness address essentially facilitates a reduction in the consumption of space by managing the data of a given signature. It also transfers the signatures from the input structure to the final stage of the transaction. 

How does SegWit work?

The working mechanism of a segregated witness address (SegWit) starts with –

  • A transaction that contains the wallet address of the sender and the receiver.

 

  • The second part of the transaction contains data and signatures. The segregated witness address removes and isolates the data from the main block which reduces the overall transaction size. This is how transactions consequently need less space which enhances the scope for more transactions for each block. 
  • Once this process is done, the segregated witness address fixes the remaining flaws in the Bitcoin protocol that enables the user to alter the transaction hashes. When there is a change in a single character, there is a corresponding change in the rest of the transaction hashes. 
  • As soon as the signatures are removed from the transaction data, there are no more changes needed in the existing transaction ID. 

What advantages does it offer? 

Segregated witness addresses come with a lot of advantages for the users. 

  • Firstly, it is a simple and effective solution to most of the problems in the Bitcoin protocol, including transactional fees and inefficiency in operations. 
  • Secondly, segregated witness addresses allow the user to perform more transactions without influencing the overall Bitcoin blockchain size in general. 
  • The user gets to transact Bitcoins at a cheaper rate which is the result of higher transaction speed. 
  • In addition to this, there is always a good scope of new and exciting developments in its arena. This is because Bitcoin is one of the cryptocurrencies used by the masses due to its popularity.
  • At the same time, a lot of users face issues with the problem of scalability. This is exactly what segregated witness addresses help with. 

What are the complications involved?

While several advantages come with segregated witness addresses, it also suffers from various complications that a user needs to be aware of. 

Firstly, it does not allow the miners to generate great profits as the support system includes witness data side chain, which hinders the scope for generating fees revenue. 

Secondly, this particular protocol fails to go far enough to address the issue of scalability; this makes it a short-term solution to long-term issues. Several Bitcoin miners agree that there are major changes to the Bitcoin blockchain size but how transactions are processed is equally problematic in the long run. 

In addition to this, it can cause possible divisions in the entire Bitcoin community due to the ongoing disagreements surrounding its usage. 

What is Native SegWit? 

Native Segregated Witness Address (Bech32) that is equally compatible with segregated witness address (SegWit). The address strings in Bech32 always start with bc1, which gives it a distinct format.

Initially, the developers implemented it as a part of the Bitcoin improvement proposal but then various addresses were integrated alongside the core ones. Coming to its format and structure, it has changed a lot since its initial developments. It now uses mixed case lettering because the initial addresses are difficult to type and are often vulnerable to input errors during transactions. 

What is its working mechanism?

The working mechanism of native segregated witness addresses is quite similar but at the same time different from SegWit. 

As soon as a transaction is initiated from the end of the sender, the involved codes and transaction data are stored on the database and immediately transferred to the end of the sender. The involved script code and characters are recorded on a separate extended block. Hence, the decentralized structure provides enough safety and security for both ends. As soon as the transaction is completed and the Bitcoins are transferred to the target wallet, the data is recorded and shared with the server.

What benefits does it offer to the users?

  • In comparison to other segregated witness addresses, Bech32 has a comparatively lower transaction fee.
  • There is also a lesser chance of errors while sending and receiving Bitcoins through native segregated witness addresses. 
  • In addition to this, with Bech32 addresses, the user can also identify the characters involved in their transaction that are likely to be incorrect. Hence, the user experiences a safe and secure transaction experience without any hassle on the blockchain.

Are there any disadvantages?

One of the biggest disadvantages of native segregated witness addresses is that it is not completely compatible with the old software. This is also the reason why the users are not able to get messages verified in every software. In addition to this, minors are usually not able to generate great profits as there is a lower transaction fee included in the transactions. 

What are the major differences between SegWit and Native SegWit?  

Now that we are aware of what the two terms mean, let us now proceed with our discussion of SegWit vs Native SegWit (Bech32) and reflect on the differences between the two. When it comes to comparing the two types of Bitcoin address formats, it is essential to consider various factors and then see what works better with one and fails in the case of the other. 

Although both SegWit and Native SegWit present a plethora of features to the user, there are several differences between them. The mechanism behind transactions is quite different in segregated witness addresses and legacy addresses. 

Here are some other differences that give one an edge over the other –

Wallet support 

One of the biggest differences between SegWit and Native SegWit is the wallet support that a user gets. As far as the facility to send and receive Bitcoins is concerned, both Bitcoin address formats enable the user to do so. You can easily send or receive Bitcoins in your wallet using the to address formats. 

However, one major difference between the two is that unlike Native, SegWit moves all the data in the Bitcoin block, which keeps signatures of all the transactions together. It allows more and more transactions to take place in the same amount of space while maintaining the security level on the Bitcoin blockchain. It uses different addresses and various third-party wallets to facilitate transactions. Nevertheless, the user needs to check whether the preferred wallet option provider supports all types of address formats or not.

Transaction fees

If there is one ground that forms the basis for the difference between the two, it is the transaction cost involved.

  • The user gets several benefits with SegWit as it allows them to send Bitcoins at a lower transaction fee. The fees are lower because it is based on the rate and size of the transaction which reduces the total effective size.
  • However, if a user goes for Native SegWit, the overall transaction cost is comparatively lower than the former when sending Bitcoins from a legacy address. In other words, the user gets more benefit with a Native SegWit. 

It is also a major reason why many blockchain wallet providers have set their default settings to Native SegWit as the receiving address because a user gets to enjoy a lower fee whenever they receive Bitcoins in their wallet. 

In addition to this, it is also essential for the user to know that if they receive Bitcoins previously on the legacy addresses in their wallet, it is likely to remain on the legacy addresses until they send it again. It usually happens because moving the Bitcoin from one wallet to the other increases the overall transaction fees. 

Efficiency in operations

Another major point of difference between the two is the scope for efficiency in transactions. SegWit (segregated witness) address formats and provides a much better scope for efficiency than the traditional legacy formats. It happens because the segregated witness addresses enable the separation of signatures every time a transaction takes place concerning the original transactional data. As a result of this separation, any user that uses a segregated witness address pays a lower transaction fee and experiences better efficiency in transactions as compared to legacy addresses. 

Apart from this, a user gets to experience faster transactions if it involves a segregated witness address that also comes with an improved capacity of the blocks. It happens because blocks can store data for more transactions with segregated witness addresses when compared to legacy address formats. Segregated witness addresses also present a better scope of formidable improvements in terms of block size, which provides better efficiency to the user as compared to legacy address formats. 

Safety and security

In terms of the safety and security of transactions, segregated witness addresses are a far better option as it involves separating signatures from the transaction data. Due to the separation, there is a lot more scope for improved security while transferring Bitcoins from one wallet to the other. Also, it makes it difficult for the hackers to keep track of the transaction signature due to the isolated entities, which is an additional benefit. On the other hand, native segregated witness addresses also present a lot of scope for improvement in safety and security as there is a new address format for each transaction. In a nutshell, the user gets enhanced security features with both options.

Format 

The format is another ground that differentiates segregated witness addresses and legacy addresses. Segregated witness address is the most common Bitcoin address format that easily goes with any business or wallet support. It typically starts with the number 3 and consists of 26 to 36 characters. Additionally, it leverages the P2SH script for the basic functions and can also support non-native segregated witness transactions by complying with the recommended cryptographic standards. On the other hand, a Native SegWit presents for beating differences from the general styles, and its format usually starts with bc1. 

Who’s the winner?

With reference to the discussion regarding SegWit vs Native SegWit (Bech32), it is safe to say that SegWit is far better in terms of the improvements it has witnessed. It gives a faster transaction speed at low fees with improved scalability. The user gets improved prospects for error detection. 

Additionally, the segregated witness address format also enables you to detect any scope for improvement and identify areas where there is better readability by presenting the address in lowercase. Hence, it presents the user with a plethora of benefits over native SegWit. 

Final words 

On a final note, it is apparent in our debate of SegWit vs Native SegWit (Bech32) that SegWit presents a set of promising features to the user over its competitor. The comparison of these popular Bitcoin address formats along with a deep understanding of their respective significances leaves good scope for differentiating between the two. The differences in their features also represent their revolutionary journey as a solution for issues with the existing legacy address formats. Both the types of address formats help in increasing the efficiency of the block side apart from accommodating the volume of transactions in every block.

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Cardano enjoys all-time high network activity

Cardano enjoys all-time high network activity

Thriving as a top-tier blockchain ecosystem, Cardano is fast approaching the maximum limit of its processing capacity as the network activity increases on the decentralized channel. While sustaining a constant value of more than 90% blockchain overload for eight days in a stretch, the Cardano blockchain has emerged as a strong player in the market. The surge in network activity can be attributed to the increase in block size implemented by the Cardano cluster in November 2021 to enhance the operability standards for the customers.

In Layman’s words ‘blockchain load’ refers to the volume of memory space filled within the average Cardano block through user involvement. Where a full 100% blockchain load shows that the blocks have attained their maximum level, a 0% load indicates no activity on the channel. As per the report from Cardano Blockchain Insights, the network activity on the portal skyrocketed on January 14, 2022, from a value of 55.2% to 91.8% on January 16, 2022. The spike has continued to fluctuate above 90% since January 19, 2022. The all-time high of 94.1% was recorded on January 21, 2022, on the channel. The company increased its block size by 12.5% two months ago to meet this burgeoning network traffic.

Where on one hand this hints towards the struggling state faced by Cardano in meeting the network requirements on the other hand it shows the rise in blockchain adoption rate. The load increased since September when the firm launched smart contracts for users. Despite this, Cardano’s native token ADA is trading 60% low at a value of $1.05 from the earlier $3 value. Throughout 2021, Cardano gained momentum as an eco-friendly smart contract platform. The current market cap of the project is more than $33B despite the ongoing crypto slump.

It is interesting to note that Cardano is expanding its block size to maintain the load whereas Bitcoin and Ethereum are taking other significant steps for the same purpose. The Bitcoin network is increasing scalability level through layers, predominantly the lightning network, for processing transactions off-chain and settling them in groups on the main chain. Ethereum is moving to similar layer solutions like roll-ups along with complex verification themes like sharding to expand scalability. The Bitcoin owners refused to accept block size increase in 2017 by rejecting the SegWit 2X upgrade. The solution was rejected to hamper decentralization. The Cardano platform has managed to sustain its position in the industry with constant upgrades in its system dedicated to making the ecosystem more user-friendly and effective.

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