Conflux, a blockchain protocol designed for decentralized applications (DApps) that promises much higher capabilities in terms of scalability and speed, has raised US$35 million from prominent investors and some of China’s biggest tech firms.
Investors in the round include Metastable, the cryptocurrency hedge fund co-founded in 2014 by Angellist’s CEO Naval Ravikant, Sequoia China, IMO Ventures, FreesFund, Rong 360, Shunwei Capital, F2Pool, Huobi and Nirvana Capital.
Rong 360 and Huobi have committed to developing DApps on the Conflux protocol and the startup also signed a memorandum of understanding with South Beacon which plans to use the Conflux blockchain to provide greater transparency to its ride sharing business and customers, Conflux said on Tuesday.
Commenting on his firm’s investment in Conflux, Haseeb Qureshi, general partner at Metastable, said:
“Conflux introduces the first decentralized platform that we believe is poised to be the protocol supporting the next wave of apps from China’s leading tech companies and startups, and we’re excited to be a part of Conflux’s journey.”
Conflux, which is targeted at large firms and tech giants, claims to be the first fully decentralized DApp-ready proof-of-work (PoW) protocol that’s capable of processing up to 6,000 transactions per second while supporting at least 20,000 nodes.
It intends to solve the long-standing scaling issue inherent to protocols such as Bitcoin and Ethereum, which can only process about 7 and 30 transactions per second respectively and fail to respond to the needs of large-scale DApps.
In a decentralized blockchain system, transactions need to be confirmed by the whole network, which takes much longer than in centralized services such as the Visa network. Conflux says its protocol can confirm transactions in about 10 minutes even at over 3,000 TPS on average, a huge improvement compared to Bitcoin and Ethereum.
The system relies on a novel Directed Acyclic Graph (DAG)-based ledger structure together with an optimistic concurrency control to achieve a consistent order of transactions among all the nodes in the network.
While blockchain protocols like Bitcoin only allow a single block at one time onto a single chain, Conflux can accept multiple concurrent blocks at the same time from any node. The system records information about two kinds of relationships between blocks, parent-child relationships and generate-before relationships. The concurrent blocks are later counted and converged into one final chain, which consequently could be visualized more like a network of blocks, less a chain of blocks.
“Imagine developing DApps on a fully decentralized protocol like Bitcoin, with the scalability of centralized platforms,” said Fan Long, co-founder of the Conflux Foundation, the organization that’s developing the protocol. “Until Conflux, many would argue that it wasn’t possible. Conflux solves the traditional consensus bottleneck that proof-of-work blockchains, like Bitcoin, have been stymied by.”
“Conflux’s main idea is how to make the whole blockchain scalable. We’ve changed the structure of the blockchain so that it’s no longer a chain in the sense that it records each block based on what its parent block says,” Long told Fortune.
Conflux was developed based on published research conducted and produced by the startup’s founders at the Institute of Interdisciplinary Information Science (IIIS), Tsinghua University, the University of Toronto and Alt-chain Technologies. It counts amongst its founders Andrew Yao, recipient of the Turing Award in 2000 for his contribution to the theory of computation, who serves as chief scientist at the startup.
Conflux plans to release its public testnet by the end of February 2019 and the main network by the third quarter of next year.
Japanese financial services company SBI Holdings will partner with software firm R3 to expand local use of its Corda blockchain platform, Cointelegraph Japan reported Dec. 5.
Quoting local news outlet Nikkei, the report reveals that SBI, which is involved in multiple cryptocurrency and blockchain-related activities, will expand on its existing investment in R3 to create a “joint venture” aimed at promotion.
“Europe is the most advanced in blockchain product development,” R3 CEO David Rutter told Nikkei in an interview:
“The new joint venture will strengthen the Japanese language service, and promote adoption.”
The company added its R3 partnership would extend beyond Japan to cover the wider Asian space.
R3 focuses on using Distributed Ledger Technologies (DLT), such as blockchain, to facilitate efficiency increases primarily for banking partners. Based in the United States, the startup has clients throughout the world, which currently number around 200.
Deals continue to come, Cointelegraph this week reporting on a group of French banks completing a Corda-based Know Your Customer (KYC) trial, while R3 also announced that the first cryptocurrency added to its payments DApp would be Ripple (XRP).
SBI is also deeply entrenched in XRP, its joint money transfer operation SBI Ripple Asia gaining Japanese regulatory approval in September.
Within a 48-hour span, since December 5, the Bitcoin price has dropped from $3,913 to $3,678, by just about six percent.
Other major cryptocurrencies like Ethereum (ETH) and Stellar (XLM) have declined by more than 10 percent in the past two days. The Ethereum price has dropped from $112 to $101 while the Stellar price has declined from $0.15 to $0.13, by over 13 percent.
In the past 12 hours, the crypto market as a whole lost about $6 billion of its valuation as tokens lost on average around 10 to 20 percent of their value against the U.S. dollar.
Waves, Maker, Aion, Chainlink, and Theta, which performed significantly better than most of the small market cap ERC20 tokens in the global market, recorded steep sell-offs on the day.
Is $3,000 Bitcoin Unavoidable
On November 25, the price of Bitcoin (BTC) plunged to its yearly low at $3,456 as bears began to fuel one of the strongest sell-offs in all of 2018.
Prior to that, in October, prominent cryptocurrency analyst Willy Woo said that the dominant cryptocurrency will likely not reach a bottom until the end of the second quarter of 2019.
Woo said at the time:
“Putting together the blockchain view, I suspect the timing for a bottom may be around Q2 2019. After that we start the true accumulation band, only after that, do we start a long grind upwards.”
Based on the intensity of the downtrend of Bitcoin throughout the past two weeks, a drop to a new yearly low in the range of $3,000 to $3,400 seems unavoidable, especially if the volume of BTC is considered.
If the price of BTC is dropping at a rapid rate due to a significant surge in its daily volume, then it can be said that the drop occurred due to the entrance of new bears in the market. But, since late November, BTC and the rest of major cryptocurrencies have been free-falling with low daily volume.
On December 6, for instance, the price of BTC fell by nearly four percent on the day. Yet, its volume has actually declined from around $6 billion to $5.3 billion.
Some technical analysts including DonAlt said that the the support level of BTC is not strong enough and if it continues to fall below the support level, a drop below the $3,000 could be the the next target.
Closed below support, not looking too pretty. BTC needs to reclaim supports quickly otherwise. I expect it to go for the previous lows. If those don’t hold I’m looking at $2,900. There are no supports left on the daily, hope for a fakeout or SFP at the lows.
State of the Market
Currently, momentum oscillators are demonstrating oversold conditions of BTC at $3,700. In the short-term, the crypto market could experience a minor recovery from its low price range.
However, throughout December, if large market cap cryptocurrencies fail to breakout of major resistance levels, then BTC is likely to remain in the tight range of $3,000 to $4,000.
Featured Image from Shutterstock. Charts from TradingView.
Get Exclusive Crypto Analysis by Professional Traders and Investors on Hacked.com. Sign up now and get the first month for free. Click here.
A lot of cryptocurrency enthusiasts and market observers reference websites that measure the digital asset economy by market capitalization. Now there’s a new data website, Coinmarketbook.cc, that calculates a cryptocurrency’s buy support based on order books held on various exchanges.
Also read: US Law Enforcement Wants Surveillance Tools for Privacy Coins
‘Market Cap is a Lie’
There are many analytical websites that record the data of the largest digital assets by value and most of them focus on the total market valuation of each currency. Sites like Satoshi Pulse refer to the total U.S. dollar value of the number of coins that are in circulation. For instance, the price of bitcoin cash (BCH) is about $140 per 1 BCH, with a circulating supply of over 17 million coins, giving the currency a market valuation of around $2.46 billion. That places bitcoin cash markets in the fifth position among 2000+ digital assets within the crypto-economy. But Coinmarketbook measures the value of digital assets in an entirely different way, because it instead focuses on buy support for cryptocurrencies and determines the value of each coin in this manner.
“Market cap is a lie and buy support tells the true story,” Coinmarketbook explains on its front page. “Buy support ratings separate investments from gambles and buy support analytics determine if the current price will hold.”
Coinmarketbook is quite different than data sites that show market caps. At the time of publication, bitcoin core (BTC) was still No. 1 on Coinmarketbook’s list, as it had a buy support rating of around 100 percent. Things get drastically different from standard market-cap sites from there, as BTC is followed by ether with 21.68 percent buy support, eos at 8.73 percent and ripple at 8.65 percent, with litecoin rounding out the top five at 3.78 percent.
The statistics also show how buy support is gauged by the number of markets a coin is listed on. For example, BTC is listed on 25 markets, but other coins have upward of 35 market listings.
Market Data Variance
Coinmarketbook lists a lot of markets, but it doesn’t quite match the amount of exchange data used on sites like Coinmarketcap.com and Satoshi Pulse. For example, Coinmarketbook lists a total of 16 markets, including exchanges such as Bitmex, Bithumb, Huobi and Bittrex. However, the site is missing information from the top BCH exchanges by volume today, which include Binance ($12.4 million), Coinbase ($4.1 million), Hitbtc ($4 million), Kraken ($3.5 million) and Poloniex ($1.4 million). This is clear to see on Coinmarketbook’s website. However, the creator of the site recently said on Twitter that more exchange data is on the way.
Coinmarketbook is following the lead of a handful of other analysis sites that rank cryptocurrencies according to different criteria, such as fair market value and “honest” global trade volumes. Coinfairvalue.com, for example, is a platform that evaluates fair market value rather than focusing on speculation.
The creator of the Honest Coinmarketcap spreadsheet, meanwhile, believes that global cryptocurrency trade volumes are often blown out of proportion. Trade volume figures for specific coins such as BTC and ETH are exaggerated by as much as 80 percent, while volumes of digital assets like BCH and XRP are off by 43 to 70 percent, he claims.
Deceptive Order Books
Given that it is missing data from a number of exchanges, Coinmarketbook should probably add more analytics to become more accurate. Cryptocurrency enthusiasts should also take assessments based purely on buy support and order books with a grain of salt. Order books can be misleading, as not all of the buy and sell orders on exchanges are real.
Many order books on trading platforms have plenty of orders, but good traders know that some of them are bluffs. An individual may place an order to buy or sell an asset, but that doesn’t mean he or she will execute the deal when the time comes. Some traders use phony orders to make the market move or trend in certain ways, which is why assessing a coin by this kind of so-called support can be misleading. Traders do use order book depth charts for some clues down the road, but depending on them entirely to make trades can be very risky.
What do you think about Coinmarketbook.cc and how it evaluates coins by order book buy support? Let us know in the comments section below.
Images via Shutterstock, Coinmarketbook.cc, and Bitstamp.
Need to calculate your bitcoin holdings? Check our tools section.