The Weekly Decrypt No. 2: January 11-15, 2016

The Weekly Decrypt No. 2 | January 11-15, 2016

The Daily Decrypt is an independent member of the Let’s Talk Bitcoin network and offers daily weekday video casts to its listeners on a wide variety of cryptocurrency and blockchain technology topics.

The Daily Decrypt began the week of January 11th, 2016 with an episode detailing the growth in quantity and fluctuation in market capitalization of all cryptocurrencies since April 2013. The data presented was compiled from coinmarketcap.com and is a fine representation of just how much of a bite the cryptocurrency markets have taken out of the world’s fiat currencies. The total market capitalization of all cryptocurrencies peaked in April 2014 at about $6.4 billion before dipping until late 2015 when it rose to a new high of over $7 billion.

On Tuesday, host Amanda answered a series of questions about smart contracts from her manservant over lunch at their favorite diner. Smart contracts, generally speaking, are digital contracts of code between two parties that execute automatically upon completion of a pre-specified set of criteria. Smart contracts are most notable for absolving the need for involving expensive and obstructive third parties like banks, lawyers, and governments in agreements between two parties. Practical applications for this disruptive and empowering technology are just beginning to emerge and are expected to explode over time as providers make the technology more user-friendly. Currently reliable providers include Reality Keys, Oraclize and Smart Contracts.

On Wednesday we were provided with a demonstration on using a Bitcoin ATM to turn cash into BTC and purchase candy from a Bitcoin vending machine. The process is as simple as inserting cash into the Bitcoin ATM after allowing it to scan a QR code containing the receiving Bitcoin address, sending the Bitcoin to a mobile wallet from the Bitcoin ATM and then to the Bitcoin vending machine and selecting your candy of choice.

Thursday’s episode summarized 5 ways by which the cryptocurrency king, Bitcoin, could potentially be dethroned:

    1. Bitcoin fails to de-cap its block size, or at least dynamically scale it to meet demand.
    2. Bitcoin fails to expedite its governance and decision-making process.
    3. Bitcoin fails to make its addresses human-readable at the protocol level.
    4. Bitcoin fails to offer instant confirmations, or increased trust of zero confirmation transactions.
    5. Bitcoin fails to incentivize honest actors to run full nodes.

The week’s final episode on Friday was hosted by guest, expert researcher and technical analyst Francesca, who summarized her findings on newcomer to the cryptocurrency scene, Ethereum. Ethereum’s mission is to refine the way we experience the internet. While Bitcoin has served to decentralize money, Ethereum hopes to decentralize all peer-to-peer actions that takes place online.

Ethereum, like Bitcoin, operates on a blockchain of over 1400 nodes and its native currency is Ether. Ether is currently mined via Proof of Work, however it is expected that the code will be changed to incentivize Proof of Stake some time late 2016. There is no hard-coded limit on the amount of Ether that will ever exist and it is difficult to find information on how many Ether are currently being produced.

While Ether can function as a currency and facilitate user-issued tokens or assets, Ethereum’s primary focus is on smart contracts and decentralized applications (dapps) that run on its network. Dapps already operating on Ethereum include EtherDice and Oraclize, a smart contract provider. Businesses building their foundations on Ethereum include Augur and Slock.it.

Development of Ethereum is funded by its foundation which received its seed funding via the initial round of crowdfunding for Ethereum in 2014. Plans for funding going forward are unclear.

Perhaps the most important aspect of Ethereum is that it’s Turing complete, meaning it’s programmable in any computing language. Developers interested in getting involved should visit http://ethereum101.org/.

All episodes of The Daily Decrypt published to date can be found on their YouTube channel and weekly summaries will continue to be made available here at CORE Media.