Patrick Gon

Three of the major cryptocurrency mining hardware manufacturing companies notified their customers that the shipment of their orders would be delayed at least one week due to the quarantine established in China by the coronavirus.

This week MicroBT, Bitmain, and Innosilicon notified their customers that the cryptocurrency mining ASIC teams they had ordered would not be sent immediately, because the Chinese government had extended the Chinese New Year’s festivities because of the outbreak of the coronavirus, said Artem Eremin, production manager of the equipment retailer ASIC, 3Logic.

MicroBT published a notice on WeChat regarding the decision taken by the government of Guangdong Province to extend the Chinese New Year’s festivities for another week, until February 9. As a result, “production, shipping, post-sale services, shipping and receiving documents and other arrangements” would be delayed, “says the MicroBT notice.

Eremin stated that both Bitmain and Innosilicon also warned their customers about the delay in sending their orders.

Bitcoin trade volumes paired with the Chinese yuan on the LocalBitcoins p2p trading platform have fallen to the level of 2017, according to iHodl Russia. These volumes have been in a downward trend since the end of 2019. The volumes have fallen from an annual maximum of 45 million yuan (approximately USD 6.5 million) by more than 90%.

The highest trading volume was recorded in January 2018, when LocalBitcoins recorded 168 million yuan (USD 24.3 million) in operations.

The coronavirus, formally called nCoV-2019, was first sighted in January in the Chinese city of Wuhan. The authorities quarantined the entire 11 million inhabitants of the city, as well as several other nearby regions.

According to reports, the coronavirus has already killed 170 people and has caused more than 7,700 infected worldwide.

Between January 25 and 31 the cryptocurrency market presents a clear upward predisposition. Most cryptocurrencies registered significant increases in their prices, some of which reached almost 40%.

The price of BTC experiences an important increase in these seven days, with a sustained growth that brought its value from USD 8,326 on the 25th, to USD 9,271 at the time of this writing, according to Live Coin Watch statistics. On average the cryptocurrency rises by 9.35%.

The price of other important cryptocurrencies also shows significant increases. Ether (ETH) rises on average 10.56%, Ethereum classic (ETC) increases more than 26% and ranks among the most valued, as does litecoin (LTC) that grew more than 20%, while the XRP price of Ripple records 5.85% more.

In the top of the most appreciated of the week are siacoin (SC), zcash ZEC) and ethereum classic (ETC) with increases of between 27% and 40%. They are followed by litecoin (LTC) and cardano (ADA), with growths around 19% to 21%.

Siacoin

The siacoin token (SC), of the decentralized Siacoin cloud storage platform, is in the first place among the most valued crypto assets. After maintaining a more or less constant value since January 25, it rose  slightly on January 28, when it went from USD 0.0016 to USD 0.0018 . Another jump is recorded on day 28 when it passes from USD 0.0017 to reach a peak of USD 0.0024.

For this January 31 the value is USD 0.0021. The growth was around 40%, while the market capitalization reached USD 90.6 million and the volume of trade in the last 24 hours was about USD 6.3 million.

Among the most outstanding information about this cryptocurrency, the announcement of the update v1.4.2.1 stands out, with which «sustained speeds of more than 1 gpbs of loading and unloading can be achieved», according to what is stated on Twitter . They add that this version also updates the policy of contractual expenses that allows Sia to be much more efficient with money when contracts with new hosts are formed. While several errors are fixed, the FUSE controller now supports the ‘allow-other’ flag, as published by the team on Reddit. 

Zcash

Zcash is one of the cryptocurrencies focused on privacy. This week recorded an increase of approximately 31.24%. The increase was constant during the week and its value went from USD 48.64 to USD 65.18 in seven days. The market capitalization of ZEC is USD 575.5 million and the daily trade of USD 486 million.

For January 30 a maximum is observed in the price that brings its value to USD 69.26 . This increase coincides with the announcement that part of the mining rewards in the Zcash network will go to a fund to finance developers linked to the project, while the current financing system expires in October this year.

In total, 20% of the profits of the miners to decipher each block go to that financing fund, after a vote in which 88 voters of 119 possible participated.

Ethereum Classic

Ethereum classic (ETC) recorded a 26.74% growth this week to rank third among the most appreciated cryptocurrencies of the week . The cryptocurrency  went from trading at USD 8.29% at the beginning of the week to be worth USD 10.93 at the time of writing this note.

The price advance is observed from January 26, reaching a peak of USD 12.72 on January 29. After that date it registers a slight fall, whose decline is accentuated this January 31. The market capitalization is USD 1,275 million and the trade in the last 24 hours is USD 2,184 million.

The platform recently successfully executed the Agharta strong fork, through which the Ethereum Constantinople bit-by-bit information processing code was added to the main ETC network, which will generate greater compatibility between the two.

Additionally, the team is currently working to offer full byte code compatibility with the main ETH network by March 25, 2020, in block 10,500,839, a date that they already promote as “Phoenix Day” . That day, two strong bifurcations will be activated, the developers explain: ECIP 1061 (EVM and Aztlan protocol updates, and ECIP 1078 (Phoenix EVM and protocol updates).

Litecoin

The Litecoin cryptocurrency , currently located in sixth place in terms of market capitalization (estimated at USD 4,311 million), is quoted on this date at USD 66.92. With a growth of 23.48% in the last 7 days, the cryptocurrency experiences a significant increase since January 30 , with trade volume of USD 1,014 million.

The growth is gradual from January 25 until reaching a USD peak of 68.93 on January 30, with slight corrections in the last hours. This LTC price advance coincides with a comment posted by cryptocurrency founder Charlie Lee.

On his Twitter account, Lee published a proposal to create a financing mechanism based on the profits of mining groups in that network. The idea would be that the mining pools “voluntarily donate a portion of the block reward” that corresponds to them for their mining activity.

Cardano

The price of the cryptoactive started the week with a value of USD 0.0436, closing these seven days with a value of USD 0.0525. After reaching two peak of USD 0.0558 and USD 0.0560 on January 29 and 30, respectively, the price fell again in the last hours. The market capitalization is USD 1,362 million and its daily trade volume is USD 89.9 million.

The Cardano team (ADA) revealed on January 27 a new document detailing how smart contracts will be implemented in its next update, called Goguen. The system adds the ability to build decentralized applications (DApps). However, the release date of this phase is not yet defined.

The open source collaborative project for the development of enterprise blockchains, Hyperledger, unveiled the release of version 2.0 of its modular Fabric solution. Up to six improvements were introduced to optimize the execution of smart contracts, in this case called chaincodes , in addition to modifying the type of consensus among participants and improving privacy levels.

Hyperledger informed, through a statement , that the improvements applied to its solution took into account the suggestions made by members of the developer community and industry actors , who already use version 1.0 since it was launched in 2017.

The six improvements include the following aspects: a new management of the life cycle of smart contracts . That is, a decentralized governance was introduced so that the participants reach an agreement on the parameters of a chaincode , before the data is added to the blockchain . In practice this will not allow anyone to register information on the network until there is a consensus.

The same pattern can also be applied in the uses of smart contracts so that “organizations give their consent to data transactions, before committing themselves to the ledger,” Hyperledger said of the second of the improvements.

As an example, the consortium explained that organizations can now extend their copy of a chaincode to meet their individual requirements. That is, an organization can add its own validations to better protect its specific interests before backing up a transaction. . As long as there is consensus among the participants for a given transaction, it will commit to the ledger as in previous versions.

Privacy and performance

The third improvement allows organizations to share data privately with other organizations, through a new feature called private data collections.

“For some use cases, the implementation of private data collections did not help us. Imagine you have 100 relationships with other participants and you don’t want them to know each other. Well, you do 100 channels which spends a lot of resources or you make a private data collection, which is already revealing your 100 relationships, ”he explained on Twitter, the blockchainer Maritere Nieto, of the Telefónica company.

The fourth modification is a new chaincode pitcher external , which implies a great change in the way in which the contract life cycle is managed.

The fifth improvement is related to a new type of consensus called Raft, for the order service and the sixth is the addition of a new cache “to improve performance when using CouchDB as the status database,” Hyperledger said.

Fabric is the most popular blockchain solution Hyperledger offers for businesses, but it is not the only alternative . It also offers platforms such as Besu, Burrow, Indy, Iroha and Sawtooth.

Around Venezuela there are many myths. There are about their day to day, about their customs in the midst of the crisis and, of course, about cryptocurrencies. Myths are no exception in the South American country.

Mainly, about Venezuela a narrative has been generated according to which it is a country with an adoption of cryptocurrencies enviable to other countries. The most daring, dare to classify it as a “kryptonation” or, at least, as close to it. Nothing further from reality.

In Venezuela, as a result of the hyperinflation in which the economy is involved, people have chosen to seek refuge in foreign currencies, such as the dollar or the euro, to safeguard the value of their money. In that scenario, bitcoin has found a clear use case among Venezuelans.

However, the figures that are usually used to refer to an advanced adoption of this and other cryptocurrencies in the country are not held in a global scenario. One of these figures is based on the LocalBitcoins market, which is clearly reduced compared to large cryptocurrency exchange houses.

The Latin American country with the largest trade in LocalBitcoins

Yes. Venezuela is the Latin American country with the highest BTC trade volume in the peer exchange platform. With more than 540 BTC traded during the most recent week, even being this lower than previous months, when Venezuela has remained among the first of the countries with the highest bitcoin trade on that platform.

If we refer to the last week, in fact, Venezuela is second. In front of the South American country is only Russia, with 900 BTC marketed in LocalBitcoins, according to the tracking portal of this and other markets, Coin Dance.

But the global volume of LocalBitcoins is not enough to consider that the activity of Venezuelans on that site has an important impact on the bitcoin market.

In Coin Dance data, we can see that globally, during the last week, 3,594 BTC moved in LocalBitcoins. That equals about USD 31.5 million.

To get an idea, the pair with the highest volume for bitcoin, according to Live Coin Watch figures , mobilizes more than USD 487 million, not weekly, but in the last 24 hours. That number corresponds to the BTC / USDT (tether) pair in the Binance exchange.

Putting it even more in perspective, we can see the volume in USD that Venezuela moved through LocalBitcoins throughout 2019. The figure (just over USD 300 million), extracted from UsefulTulips , does not exceed the volume of the last 24 hours in Binance.

Even in the CoinMarketCap list you can see at least 24 pairs of bitcoin exchanges that have moved more than USD 300 million in the last 24 hours, in various exchange houses.

On the other hand, volumes in LocalBitcoins, both in Venezuela and in the rest of the world, have been falling steadily in recent months. Thus, Paxful, another peer exchange site with a mechanism similar to that of LocalBitcoins, has been gaining ground.

UsefulTulips figures show that in Paxful, more than USD 24 million moved in BTC during the last week. Gradually, this site has been approaching the numbers of LocalBitcoins, with an important difference: Venezuela is not among the countries highlighted by trade on this platform .

In this exchange site, the South American country is relegated to sixth place among Latin countries. And the volume did not reach USD 300 at the end of January.

Local and regional markets

The volumes of bitcoin movements from Venezuela are also not supported in a comparison with exchange sites in the region. For example, Bitso, the exchange house created in Mexico, moves in a quarter of a quarter of what Venezuela moved in LocalBitcoins last week. According to CoinMarketCap data , the Mexican exchange house moved more than 459 BTC in the last 24 hours.

If we go to authorized exchange houses to operate with cryptocurrencies in Venezuelan territory, we see volumes much lower than those of other exchange houses in the region and Venezuela itself in its exchanges at LocalBitcoins.

If we take the volume, for example, of Antwerp Coin, we can see the low levels of exchange. On its own Twitter account, the cryptocurrency exchange site published on February 1 a graph in which the exchange volume is shown. In the BTC / VES pair, just 0.6 bitcoins were traded in that period. In the case of DASH, the volume in those 24 hours was just 0.5 DASH.

ATMs, points of sale and businesses accepting cryptocurrencies

Notwithstanding the foregoing, there has been progress in the adoption of cryptocurrencies in Venezuela . Particularly, during 2019 the ecosystem showed clear signs of growth. The installation of ATMs, points of sale and the proliferation of shops that accept bitcoin and other options as a form of payment, are proof of this.

As for the cashiers, there are already two installed in the city of Caracas . The Venezuelan Exchange Company has been responsible for making these devices available for the purchase of bitcoin and dash with dollars in cash.

So far, a headquarters of Traki , one of the largest retail chains in the country; and the luxurious Eurobuilding hotel, in Caracas, are the places where you can access these ATMs. Precisely, both Traki and Eurobuilding accept payments with various cryptocurrencies , such as bitcoin, dash, ether and the cryptocurrency anchored or stablecoin tether. In the case of the hotel, the new payment method began just days ago at its headquarters in Caracas .

If we add the mobile tellers that Panda Group has set up, in Venezuela there are a total of 6 cryptocurrency ATM options . This is reflected by Coin ATM Radar, with the two ATMs in Caracas and mobile devices in the cities of Mérida, Barquisimeto and San Antonio del Táchira.

According to the data of this site that tracks cryptocurrency ATMs in the world, Venezuela is sixth in the region. Colombia is ahead, with 56 devices; Panama, with 16; Dominican Republic (13), Argentina, which is 11; and Mexico, with 10.

On the other hand, in addition to Traki and the Eurobuilding Hotel, reputable merchants, such as the Burger King fast food chain or the Farmarket pharmacy chain have incorporated cryptocurrencies to their payment options.

However, in most cases, merchants that use payment processors receive settlement of their funds in fiat currency . Shops do not directly store the cryptocurrencies they receive as a form of payment.

Dash, another ecosystem present in Venezuela

Not only the exchange in LocalBitcoins and the payment gateway options have said present in the South American country. Following a strong commitment to influence the national economic reality, dash, one of the main cryptocurrencies in the market, has gained ground .

In Discover Dash figures , surpassing the 800 establishments accepting the cryptocurrency, Venezuela is the country with the largest number of businesses that receive dash payments.

Similarly, many of these businesses began in the world of cryptocurrencies with dash. Then, they have been incorporating bitcoin and other cryptocurrencies into the options they offer their customers to pay for their products.

How do members of the ecosystem see it in Venezuela?

Beyond that the numbers are low if they are compared in a broad spectrum in the global market, actors involved in the growth of the cryptocurrency ecosystem in Venezuela are optimistic about the recent advances, as some of them have confirmed in direct contact for CryptoNews .

Veinte Venezolana de Intercambio, a company that has installed ATMs in Caracas, considers the demand that cryptocurrencies are having in the country very positive . “It is the right way to go, take advantage of the state of monetary reform to incorporate a cutting-edge digital economic system,” they say.

Therefore, they consider that their ATMs have had good receptivity so far. Particularly, for the possibility of changing dollars in cash, regardless of whether they are in a state of wear and tear that in some national stores prefer not to accept. This is the Venezuelan economy , between a de facto dollarization, the depreciation of the bolivar and the efforts to protect the value of their money by citizens.

For its part, Typson Sánchez, CTO of the Panda Group, says that the growth of the cryptocurrency ecosystem has been linked in an important way to the upward movements of the market. On the other hand, he adds that the government’s efforts to make its digital currency, the petro, part of the national discussion, have generated higher expectations about cryptocurrencies in the country.

On the petro, Sánchez considers that “while it is not a reality for the user on foot it is not a viable option.” With this, it refers to the difficulties of use and even of exchange that the Venezuelan government project has had so far, which were more clearly evidenced by the allocation of approximately USD 170,000,000 in petros as a bonus to pensioners and workers public

The petro is a reality that we will have to face because the government is influencing (forcing) its use, so the companies that are in Venezuela will have to face this reality, sooner or later

Typson Sánchez, CTO, Panda Group

For Twenty Venezuelan Exchange, the inclusion of petro in the national conversation influences a possible overcrowding of cryptocurrencies in the country . “That public bodies , accounting processes and the national valuation system is established in petro is totally changing the vision of large holders of resources in the country,” they say about it.

Expectations of future growth

Both the representative of Panda and Venezuelan Exchange agree that the ecosystem in Venezuela shows positive signs. For Sánchez, this year will continue that growth. In particular, he believes that the cryptocurrency issue “will be moved in the following months.”

For its part, the company with cryptocurrency ATMs in Caracas believes that adoption in the country “will go through a difficult, possibly uncomfortable process of transformation . ” However, he believes that this process “will be worth it” because it will serve to spread the use of these technologies among Venezuelans.