Can Ethereum and Ethereum Classic coexist next to cryptosoft?

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Looking at recent developments, this is not a simple question that unsettles many traders and market observers.

Due to the unplanned decision of the Ethereum community to implement a new version of the blockchain, two different Ethereum markets now have the value of a formerly identical platform.

How large is the cryptosoft market?

The planned technical transition quickly became quite confusing when an entire ecosystem of exchanges, miners and traders jumped onto cryptosoft. As a result, a market for two tokens of two different blockchains was created like this review about cryptosoft. The blockchain ethereum created by the hard fork has a current market capitalization of over $900 million. The market capitalisation of Ethereum Classic, on the other hand, is just USD 141 million. Ethereum Tokens (Ethers / ETH) currently stand at 11 US dollars, while Classic Ethers (ETC) stand at only 1.70 US dollars.

Chris Burniske, Blockchain product manager at ARK Invest, comments on the sudden popularity of Ethereum Classic as follows:

“Initially, it looked like ETC would die a quick death as there was hardly any value left and the vast majority of Miner supported ETH.”

After the hard fork was executed, big players in the digital currency market began to buy larger quantities of ETC. In addition, those who owned ETH were automatically credited the same amount of ETC, which increased trading volume and fuelled speculation.

“The market was not really liquid, so a small increase in demand could have a strong impact on the price,” Burniske adds.

Now that the fog has subsided, many market observers are asking themselves how long ETC and ETH can coexist alongside each other. Will the Ethereum blockchain be abandoned by the developers? Will the new chain prevail? Or will both continue to coexist stubbornly? So far, the experts do not seem to agree.

Driven by ideology

Although the two blockchains are almost identical, some believe that the ideological differences leave room for different price dynamics.

Petar Zivkovski, Trade Director of Bitcoin’s trading platform Whaleclub, spoke about how the desire for an incorrigible ideology contributed to the creation of Ethereum Classic.

He argues that by rejecting the decision – to restore the stolen deposits by the so-called DAO hackers – ETC has established itself as a blockchain that preserves the finality of the transactions.

So he says:

“The emergence of ETC is proof of the power of a decentralized, non-governmental blockchain system that, despite its design flaws, clearly rejects ETH. The advocates of ETC see ETH as a centrally controllable system that is controlled by a few enlightened developers.”

In addition, some miners saw a lucrative business in the mines of the old blockchain version after the hard fork, with the increase in trading volume.

What about demand?
The question is how sustainable the current situation is. Will both markets provide the necessary fundamentals?

Zivkovski emphasises that the volatility of ETH trading pairs will remain high, as has been the case at ETH for a year now. The decisive factor here is whether the demand will also be sustained.

So he adds:

“In the past, the volumes of ETH and ETC were predominantly speculative and we all know that speculatively driven demand can quickly come to an end.

Zivkovski claims that both currencies still have to assert themselves as unique, like Bitcoin, as they have so far had only a limited use as a store of value.

Artuhr Hayes, CEO of Bitcoin’s trading platform BitMEX, says that both markets can be sustainable if they prove profitable for traders.

“ETH (pre-fork) owners have currently been able to increase their assets, since the hard fork, by combining the current prices of ETH and ETC,” says Hayes.

Technical concerns
Some market observers point to the potential technical limitations of two platforms. After all, both tokens are designed to enable decentralized Ethereum applications, and it is currently not clear how the developers will deal with two versions.

Jacob Eliosoff of Calibrated Markets says that it is very cumbersome for end users to have two different markets.

“The different ideologies may have their appeal, but for those who are

“We have no plans to introduce KYC” – Interview with LocalMonero co-founder

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Until recently, LocalBitcoins was the marketplace for the easy acquisition of Bitcoin. However, the platform recently introduced Know Your Cusomter guidelines. LocalMonero is the counterpart to the anonymous crypto currency Monero. In line with the privacy of the currency, LocalMonero does not require any authentication of customers. BTC-ECHO met LocalMonero co-founder Alex in an interview and asked him the important questions.

How did it happen that you started the Bitcoin news?

The desire to launch LocalMonero stemmed from the fact that the Monero ecosystem did not have a good gateway between Fiat currencies and Monero – a gateway that does not require a know-your-customer etiquette; a Bitcoin news gateway that is essentially peer-to-peer.

Until recently, the main advantage of LocalBitcoins was that you don’t have to go through the traditional banking route. Instead, people can choose their preferred payment method and trade Bitcoin that way. We wanted to create the same for Monero. We also believe that this is very important for Monero because the crypto currency focuses on privacy. We believe that a peer-to-peer over-the-counter market is a good fit for Monero. After all, we saw a gap in the market and filled it.

What was the biggest challenge so far? And how did you overcome it?

I think the biggest challenge is to win the trust of the users – that’s probably the case for all crypto companies. You can do that by doing your best at work: For example, we always try to implement customer feedback as quickly as possible. We respond to the tickets as quickly as we can. We are very active on Reddit, Twitter and other social networks. In addition, we try to keep track of where we are mentioned in order to be as responsive as possible. Ultimately, we believe that our commitment can win the trust of our users.

LocalMonero has been around for over half a year – I think it’s now the seventh or eighth month we’ve been online – and the community is trusting us now. The initial lack of trust can be overcome by consistently doing the customer good and not letting anyone down. I think we’ve done a good job there. Of course, we also want to continue this in the future.

The company is currently based in Hong Kong – what are the reasons for this? Are you tied to the location?

We are currently located in Hong Kong because we are actually physically in Hong Kong. Apart from that, Hong Kong is a great jurisdiction. For the readers who do not yet know that: Hong Kong and China are separate zones and have completely different legal systems. Of course, there is some dependence on military protection, but Hong Kong has its own parliament and independent judges. Hong Kong is to some extent democratic and simply offers a different economic playing field from China. Even the borders are controlled when you enter or leave the country. In other words, Hong Kong is one of the freest economic areas in the world and has an excellent business environment.

With this in mind, and the fact that we live here, our decision was made to create LocalMonero in Hong Kong. It is convenient and easy to start a business. On the other hand, if there are signs of hostility to crypto currencies, we will move immediately. In short, we have not taken root here and can build our legal entity in another place – even if we ourselves physically stay in Hong Kong.

KYC is not an option for LocalMonero
In light of LocalBitcoins’ recent demand for Customer Identification (KYC), does LocalMonero plan to take similar steps?

We have no plans to integrate know-your-customer guidelines. In addition, we have no legal obligation to do so. Should we ever come under legal pressure, our first reaction will be to look for another area of responsibility instead of imposing KYC on our customers. Because the know-your-customer requirements slow us and our customers down and create unnecessary costs. Especially for a young, growing company like ours, these costs are fatal. That’s why we prefer not to carry out any KYCs, as long as this is legally possible. I believe there will always be a place in the world for LocalMonero. We don’t deal in Fiat currencies, we just provide a platform for customers to publish their own ads. We also offer mediation and escrow services to our clients.

Switzerland founds Blockchain Task Force – Germany remains on the waiting track

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The Swiss Federal Council has set up a blockchain task force to promote their adaptation in the country, the Handelszeitung reported in December. This Friday, 12 January, the working group will meet for the first time. Its task will be to clarify the legal need for action in the course of the rushing use of blockchain and crypto currencies. Thus the federal authorities react to the boom of Bitcoin and Initial Coin Offerings (ICOs) in the country.

Hoping for the Digital Ministry?

In order to advance the public potential of blockchain use and at the same time to reveal the consequences of the emerging technologies for the Alpine country, the Federal Council, the government of Switzerland, set up a task force in December tailored to blockchain technology.

Led by Finance Minister Ueli Maurer and Economics and Education Minister Johann Schneider-Ammann, the working group is made up of representatives of the Confederation, the cantons and Swiss-based Blockchain start-ups. Together with the State Secretariat for International Financial Matters, the Task Force is to examine the legal structure of initial coin offerings and block-chain companies and clarify any urgent need for action.

The reason for this is that the blockchain is becoming increasingly important for many economic sectors, Federal Councillor Schneider-Ammann told the Neue Züricher Zeitung. This calls for a liberal government “which opens up opportunities for Switzerland as a business location and at the same time reduces risks”. In doing so, one is particularly dependent on legal security. This is to be created by the task force.

Schneider-Ammann also praised the participation of the Blockchain companies in the run-up to the initial meeting as a special achievement.

The Blockchain model pupil

However, the establishment of the Taskforce is only a symptom of a crypto and blockchain boom in the Swiss Confederation that has been boiling for some time. As a result, Switzerland is maturing more and more into a pioneering state on the European continent. Numerous examples of successful blockchain adaptations and crypto enthusiasm can be found in the Alpine country. Especially with regard to the acceptance of Bitcoin & Co., the Swiss are on the advance.

Numerous towns throughout the country are struggling for the primacy of the “Blockchain capital”. The small town of Zug, known as “Krypto-Valley”, for example, is now known throughout Europe and has developed into one of the most attractive locations for Fintech companies. The Krypto Valley Association, among others, is based here and, with the support of the Federal Council, pursues the goal of establishing a globally leading blockchain ecosystem in Switzerland.

Other Swiss communities are following suit, such as Chiasso on the Italian border. According to local media, tax payments will soon be possible in Bitcoin, as in Zug.

Another example comes from the medieval city of Lucerne. Since recently, students here can pay their bills by Bitcoin. Although the university is the first in Switzerland to accept Bitcoin as a means of payment, many more are likely to follow.

While Switzerland is showing how successful blockchain adaptation can be, the motto here is: wait and see. Following the failure of the Jamaica coalition, exploratory talks are currently underway on a relaunch of the Grand Coalition of the Union and the SPD. Both parties have little elaborate ideas about the future shape of Germany as a land for digitisation. However, both parties have taken up the cause of the birth of a central office for digital political expertise – for example in the form of a digital ministry or a digital minister of state in the chancellery.

Last year, however, the Federal Association Blockchain (Bundesverband Blockchain) was founded to ensure that the keyword “blockchain” will not fall by the wayside. It wants to put the issue on the agenda of forming a government and strengthen the Blockchain ecosystem in Germany. Whether he will be successful in his project, however, remains to be seen in the coming months.