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Elite Academics Join Forces to Build New Bitcoin

A group of professors from seven major American universities are collaborating on a new cryptocurrency called Unit-e, according to a press release published yesterday. The group’s goal is to overcome what it sees as major design flaws in cryptocurrencies like bitcoin, especially scalability limitations.

Unit-e is a work in progress from a nonprofit that calls itself Distributed Technologies Research (DTR), which officially launched the same day that it announced work on the cryptocurrency. According to Bloomberg, the group includes professors from MIT, Stanford, Berkeley and four other American universities.

Why Unit-e?

Concerns about scalability limitations in cryptocurrency seem to be driving DTR’s current efforts, which aim to address “the unsolved technical challenges of blockchain scalability,” according to the press release.

In this context, scalability means the ability of a blockchain to record cryptocurrency transactions quickly as the size of the blockchain or the number of cryptocurrency users increases.

Scalability is seen as one of the primary unanswered questions for cryptocurrencies like bitcoin, which currently manages a maximum rate of only about seven transactions per second. Ethereum does a bit better, with up to 30 transactions per second, but that’s still magnitudes short of the throughput that would likely be needed to make cryptocurrency usable for everyday payments. (For context, Visa says its payment network can support about 24,000 transactions per second.)

DTR anticipates Unit-e being able to support about 10,000 transactions per second. So far, the group has released little information explaining how Unit-e will do that, but the press release mentions research into two relevant areas. The first is blockchain consensus models, which determine how a network of computers on a blockchain agrees on which information to record to the blockchain. The consensus models used by Bitcoin and Ethereum are part of the reason why those blockchains cannot support high transaction rates at scale; presumably, DTR researchers hope to build a better consensus model for Unit-e.

DTR also said that its researchers are working on blockchain sharding techniques. Sharding allows nodes on a blockchain to store only part of the data that exists on a blockchain. Efficient sharding is another way to increase transaction speed and scalability.

How Different Is Unit-e?

Achieving better scalability through novel consensus models or other techniques is by no means a new idea. A number of other blockchain projects or cryptocurrencies, such as EOS and Nano, have already been working for some time toward the same scalability goal as the researchers behind Unit-e.

Unit-e does stand out as the work of academics rather than private-sector developers or investors — although it’s unclear whether the professors involved in the work are building Unit-e purely for research purposes or might have a commercial endeavor in mind.

For now, we’ll have to wait for DTR’s forthcoming book, “Decentralized Payment Systems: Principles and Design,” to learn more of the technical details behind Unit-e. And we won’t see Unit-e in action until at least the second half of 2019, when DTR expects to take the network live.

FinCEN Takes First-Ever Enforcement Action Against Cryptocurrency Trader

Source: FinCEN

The Financial Crimes Enforcement Network (FinCEN) has assessed a civil money penalty against a peer-to-peer bitcoin trader for violating anti-money laundering (AML) regulations, its first enforcement action against a cryptocurrency exchanger. According to the agency, the exchanger failed to register as a money services business and failed to report "suspicious transactions," among other violations. The exchanger has been assessed a $35,000 fine and is now prohibited from providing money transmission services.

2019 Investments in Crypto and Blockchain Startups at $850 Million

Source: Reuters

According to data compiled by Pitchbook for Reuters, venture capital investment in crypto and blockchain startups has reached $850 million so far this year.

EEA Launches 'Token Taxonomy Initiative'

The Enterprise Ethereum Alliance has announced a "Token Taxonomy Initiative" to develop universal definitions for tokens to encourage their interchangeability across blockchain platforms. Members of the initiative include Microsoft, R3, ConsenSys, IBM, EY, Accenture and Intel.

Gemini Adds Support for SegWit

Source: Gemini

Gemini Trust, a New York-based cryptocurrency exchange, has announced support for Segregated Witness (SegWit) addresses and transaction batching. As a result, customers can now use SegWit addresses for bitcoin deposits and withdrawals, ideally improving processing times and lowering bitcoin withdrawal fees.