Editorial 6 November 2018Erik Gibbs
DSV – nothing more than a bucket shop?
The U.S. Supreme Court defines a bucket shop as “an establishment, nominally for the transaction of a stock exchange business, or business of similar character, but really for the registration of bets, or wagers, usually for small amounts, on the rise or fall of the prices of stocks, grain, oil, etc., there being no transfer or delivery of the stock or commodities nominally dealt in.” This sounds very similar to what can be found on the Augur prediction markets platform, where users can place wagers on everything from assassinations to World Cup events. They can also bet on the state of securities and commodity prices, which might not sit well with regulators per the Supreme Court’s position.
The same concern is being raised over the OP_CHECKDATASIG, or DSV, op_code for Bitcoin BCH. The opcode allows for the integration of a third-party oracle—one that exists outside of the blockchain—that can publish prices for use in wagers of any type, including on the movement of Bitcoin BCH. By virtue of being an experiment in gambling against a cryptocurrency, this could ultimately prove to be a loser with financial regulators.
Several high-profile individuals in the Bitcoin BCH community, including Bitmain founder and CEO Jihan Wu and Bitcoin.com’s Roger Ver, support the integration of new tools on the blockchain in the upcoming upgrade scheduled for a week from now. Among these is DSV, which leads many to wonder what they’re hoping to achieve. If DSV is developed as intended and the Bitcoin BCH turns into a free-for-all gambling platform, this will not sit well with regulators and could ultimately lead to the demise of the cryptocurrency.
DSV also has another dangerous characteristic. It would enable the network to be halted. This means that Bitcoin BCH would no longer be available on exchanges, it couldn’t be traded through wallets and it would stop being useful as a currency.
The Commodity Futures Trading Commission (CFTC) has already started to take a closer look at Augur and believes that it could be operating in violation of the Commodity Exchange Act in that the platform is not a designated contract market. While Augur has tried to distance itself from being seen as a prediction market, it obviously realizes that there’s a connection. It even has a wager listed on the site, “Will the Forecast Foundation face an enforcement action from the SEC or CFTC before Dec. 21, 2018 for hosting unregulated derivatives markets?” The Forecast Foundation is the group behind Augur’s protocol.
If the CFTC is willing to go after Augur for not being a registered contract market, what is to stop it, or any other regulatory body, from doing the same to Bitcoin BCH?
Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.
Bitcoin Satoshi Vision (BSV) is today the only Bitcoin project that follows the original Satoshi Nakamoto whitepaper, and that follows the original Satoshi protocol and design. BSV is the only public blockchain that maintains the original vision for Bitcoin and will massively scale to become the world’s new money and enterprise blockchain.
Editorial 18 February 2019
Jimmy Song’s desperate need to be relevant
The man who is most memorable for his cowboy hat rather than his ideas or creations in the BTC world has created a rambling video attacking Bitcoin SV, CoinGeek founder Calvin Ayre and Dr. Craig Wright. We look at each of his claims one by one.
Editorial 18 February 2019
Dr. Craig Wright on proof
In a Medium post, Dr. Craig Wright attempts to put into simple terms why he is who he is and why most people in the crypto space completely miss the big picture on what Bitcoin is truly about.
Editorial 14 February 2019
Bitcoin SV is ready for the world’s business
The Bitcoin world hasn’t been short of amazing, with several new developments since Bitcoin was revitalized in November 2018. Bitcoin SV is proving that by following Satoshi’s original plan of keeping a stable protocol and pursuing massive on chain scaling, it opens up incredible new possibilities.