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This is How Progress in Crypto Looks Like, According to Buterin 101
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Looking into the crypto-related issues, Vitalik Buterin, co-founder of Ethereum, finds that a “significant progress” is seen in the last five years across the board, though some issues have been tackled with more success than the others.

Buterin took to his website to list sixteen main technical problems plaguing crypto, which he first described in 2014, and to discuss what progress has each seen. Each progress has been given a status description.

“Great theoretical and practical progress”

Arbitrary proof of computation has been solved, Buterin says, by building SNARKs (succinct non-interactive argument of knowledge). It allows to prove possession of certain information, e.g. a secret key, without revealing that information, and without any interaction between the prover and verifier. While there aren’t issues in fundamentals anymore, he says, SNARKs still have issues in details, but they are “extremely useful” as a privacy technology and as a scalability technology.

“Solved as far as we can”

Ethereum settled on its proof of work algorithm called Ethash, known as a memory-hard algorithm, which has proven “remarkably successful” at ASIC (application-specific integrated circuit) resistance, says the founder.

“Great theoretical progress, pending more real-world evaluation”

As even the tiniest crypto babies know, scalability has been one of the main problems in the Cryptoverse since its inception. Now, however, “scalability is one technical problem that we have had a huge amount of progress on theoretically,” says Buterin, though further progress is “incremental.” Among the important technologies introduced as solutions to this issue are sharding designs, random sampling, fraud proofs, proofs of custody, data availability proofs, and other developments. Though a number of challenges remain to be solved here, the good news is they can be “solved by just thinking about them.”

The proof of stake consensus mechanism, which should be implemented by Ethereum also, is another issue with great theoretical progress. Among many other interesting algorithms, says Buterin, which in many cases achieve “economic finality,” including in the much-anticipated Ethereum 2.0, by punishing validators caught violating the protocol, Buterin lists Casper FFG, Tendermint, HotStuff, and Casper CBC. “Eth2 phase 0, the chain that will implement FFG, is currently under implementation and enormous progress has been made.”

“A lot of theoretical progress, though still a lot to go, as well as more real-world evaluation”

Though there are many blockchains that plan to use proof of storage protocols, the questions of its performance “in the wild” and centralization still remain.

“Some progress”

This is the largest category, which also includes crypto market volatility. MakerDAO was launched and has been stable for almost two years, Buterin says, but the tough economic conditions of 2019 it survived, “were by no means the toughest that could happen,” so challenges remain.

In this category, Buterin also places funding public goods, a problem with no large breakthroughs so far, as well as the timestamping technology. Though Ethereum hasn’t had significant issues with a 13-second block time, it hasn’t been tested under serious attacks, he says. Solutions such as network-adjusted timestamps proposals are out, which also need testing.

Regarding hash-based cryptography, “the fact that not just signatures, but also general-purpose zero knowledge proofs, are possible with just hashes was definitely something I did not expect five years ago,” says Buterin, “I am very happy that this is the case.” But here too, problems like the size of proofs or aggregate signatures remain.

Furthermore, despite many attempts at anti-Sybil systems, there’s still a growing need for a human-based anti-Sybil system. Finally, there’s the so-called ‘oracle problem,’ where strides have been made, but “a real-world test of the forking mechanism,” among other challenges, still awaits.

“Some progress, some change in focus”

In the area of determining value of public-good contributions, determining tasks and determining quality of completion have been deemed difficult to separate. However, quadratic funding has been discovered and tried in real life. As Buterin explains, it’s a mechanism where individuals can make donations to projects, while based on the number of donors and the amounts donated, a formula is used to calculate how much they would have donated if they were perfectly coordinated with each other, thinking of each other’s interests.

“Slow progress”

A solution to code obfuscation is still elusive, Buterin finds. Obfuscation, however, is useful, as he describes an example use case for it: a program with a private key where the program only allows the private key to sign certain messages. Another area that needs more work is reputation systems.

“Probably not feasible, with one exception”

Useful proof of work consensus mechanism, used by Bitcoin also, is unfeasible for a number of properties- and time-related issues, but zero knowledge proofs of aspects of blockchain validity may just be an exception. Still, “the total amount of computation that realistically needs to be done is still much less than the amount that’s currently done by proof of work miners,” Buterin says, “so this would at best be an add-on for proof of stake blockchains, not a full-on consensus algorithm.”

“No progress, problem is largely forgotten”

Proof of excellence remains an unexplored solution to the problem of token distribution. There hasn’t really been an attempt at verifying human creativity directly, says Buterin, “and with recent progress on AI the problem of creating a task that only humans can do but computers can verify may well be too difficult.”
Learn more: Vitalik Buterin on The Five Biggest Misconceptions in Crypto

Sead Fadilpašić , 2019-11-27 16:07:00 ,

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.

While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock

Nick Chong , 2019-11-10 12:00:38

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