A Goldman Sachs analyst has revealed further insight into the global investment banking giant’s developing thesis on bitcoin and blockchain technology.
In a podcast[1] released this summer and highlighted by a recent New York Times[2] piece, global investment research analyst Heath Terry addressed both bitcoin and the blockchain, praising the distributed ledger as a technology that would have “massive implications” for asset and ownership transfer.
“We’re first pitch, first inning in terms of seeing how companies are going to use the technology,” Terry said, adding:
“It’s fascinating in really early stages, but it’s hard to see a world where blockchain technology doesn’t change the way we think about asset ownership.”
Part of the firm’s “Exchanges at Goldman Sachs[3]” series, the talk, recorded in June and published in late July, was meant to promote “The Future of Finance”, an annual report on disruptive financial technologies and concepts produced by its research team.
The three-part paper is the latest from Goldman Sachs to highlight bitcoin and the blockchain’s potential applications for asset transfer. Previous entries have spotlighted[4] the technology’s applications for remittances and among merchants.
Elsewhere, the podcast discussed trends in finance including peer-to-peer lending, crowdfunding and mobile payments, while focusing on the financial habits of millennials.
Notably, Terry and fellow analyst Ryan Nash chose to describe this demographic as credit card and debt averse, stating that they believes these consumers better understand the cost of financial products, including the transaction fees associated with their use.
Bitcoin adoption
The podcast found Terry addressing various questions about bitcoin as an implementation of blockchain technology as well, though his conclusions as to the viability of this application were markedly more negative.
Terry indicated that he believes the adoption of bitcoin as a currency has been held back by its fluctuating price against fiat currencies.
“The volatility around bitcoin scares a lot of people, it was great in those periods when bitcoin only seemed to go up,” he said. “It’s gone up, it’s gone down and it’s gone up. For a lot of people, the point of having a secure currency the way bitcoin is supposed to be is having a secure store of value, having a way to transfer value.”
Terry further suggested that he has concluded bitcoin is not currently competitive against traditional payment methods, noting it has been primarily used in instances when alternatives are not available.
Still, he implied he was bullish that bitcoin or blockchain-based systems could succeed on their value proposition as a kind of digital cash, concluding:
“Over time though bitcoin is going to mature, a lot of that volatility will likely come out of the system. You’ll probably see more use cases as it does.”
Beam has announced it will no longer focus on using bitcoin in an attempt to disrupt the Ghanaian remittance market.
Launched last October[1], Beam emerged as one of a number of “rebittance[2]” firms seeking to use the bitcoin blockchain as a means to enable low-cost cross-border payment services.
Beam had sought to appeal to local remittance users with a variety of payout options, allowing bitcoin received by its users to be applied to mobile phone airtime and utility bills, and by using charitable donations[3] as a way to promote its efforts.
In a new interview, however, Beam CTO Falk Benke told Disrupt Africa[4] that a revamped version of the service will not use bitcoin, saying instead that it would focus on international debit and credit cards.
The media outlet indicated that Benke cited the lack of local bitcoin adoption, the high cost of exchanging bitcoin for Ghanaian cedi and the volatility of bitcoin against fiat currencies as the reasons underlying the decision.
The news source suggested that Benke remains optimistic about bitcoin’s potential as a means of payment on the continent, but that the move was a business decision, writing:
“[Falk] said he was not saying that bitcoin would not work in Africa, but said it was no longer on Beam’s agenda for the time being.”
Despite the closure, other African startups remain focused on using bitcoin to unlock new savings in remittance markets, with $1.7m startup[5] BitPesa focusing on East African markets.
Representatives from Beam did not immediately respond to requests for comment.
This week, the Commonwealth Virtual Currencies Working Group made up of Australia, Barbados, Kenya, Nigeria, Singapore and Tonga, together with the International Monetary Fund and World Bank, concluded a three-day conference in London with a consensus: “Member states should consider the applicability of their existing legal frameworks to virtual currencies and where appropriate they should consider adapting them or enacting new legislation to regulate virtual currencies.”
The group has come up with the consensus because it recognizes the benefits and the disruptive nature of bitcoin and other digital currencies in the financial sector. The conference was joined by experts from the banking sector, academia, virtual currency operators, users and law enforcement agencies, to discuss the unique applications and the risks of criminal misuse.
One of the main members of the Commonwealth Virtual Currencies Working Group, Aminiasi Kefu, Tonga’s acting attorney general explained:
“From Tonga’s perspective, virtual currencies are a phenomena that has already arrived. Today, real estate, buildings and businesses held or owned by individuals resident in Tonga are being advertised for sale on the Internet for virtual currency, namely bitcoin.”
The Working Group received presentations from nine groups involved with virtual currencies, including the U.K. Digital Currency Association, BitPesa, Bitt, Bankymoon, Ripple Labs and Minku.
Many experts and representatives explained to other member states that the decentralized nature of virtual currencies, specifically bitcoin, has been the solution to economic inequality and remittances worldwide.
Bankymoon CEO Lorien Gamaroff explained the importance of virtual currencies in severely underbanked regions such as Africa.
“In Africa, around 80 percent of the population doesn’t have access to banks and are mainly engaged in a cash economy,” said Gamaroff.
Barclays is about to become the first mainstream bank to openly and directly support bitcoin transactions, The Sunday Timesreports. The Daily Mailechoed the news for its huge readership.
Barclays has been experimenting with Bitcoin and working with digital currency start-ups for some time.Speaking at the Morgan Stanley European Financials Conference in London, Barclays’ CEO Antony Jenkins warned the “banking sector has not yet felt the ‘full disruptive force’ of technology – but it will.” He elaborated on the growing concern among financial institutions that faster, cheaper payment systems will start to seduce their consumer and business customers in the coming years. In June, Barclays signed a deal with Bitcoin company Safello to explore financial applications of the blockchain technology that powers Bitcoin.
Barclays is not the only bank to express interest in Bitcoin’s technology and launch internal experiments and pilot projects. In fact, as recently reported by Bitcoin Magazine, major banks including Citi, UBS, Santander, BNP Paribas, and BBVA are taking serious note of Jenkins’ warning and committing resources to preliminary blockchain studies.
Now, as reported by The Sunday Times, Barclays plans to test the virtual currency, allowing people to make donations to charities in bitcoin. The bank has gone into partnership with a bitcoin exchange and aims to begin the experiment by the end of the year. Derek White, chief design and digital officer at Barclays, said: “Barclays is enabling the bitcoin exchange to help charities accept bitcoin.”
Barclays has two sites in Notting Hill and Old Street, London, dedicated to researching Bitcoin and blockchain technology, with a combined capacity of 75 staff, and is also operating a blockchain workspace in a revamped warehouse in Whitechapel, east London.The bank “is inviting start-ups, academics, and the government to work at the space to connect with others that are interested in the Bitcoin and blockchain community,” said White.
With this move, Barclays will be the first major bank to help selected customers to receive bitcoin payments directly in their bank accounts, establishing an important precedent. Focusing on charities first seems a very smart decision, which can shield Barclays from the potential regulatory and image problems, giving it time to prove the value of Bitcoin in a context that can’t be easily criticized. It can be expected that, after this first initiative focused on charities, Barclays could consider gradually allowing ordinary business and residential customers to receive bitcoin payments.
The Sunday Times mentions that a Bitcoin company was included in the trade mission to southeast Asia led by U.K. Prime Minister David Cameron a few weeks ago, which underlines the rising status of Bitcoin in Great Britain. On the trade show, Cameron enthusiastically praised the Innovate Finance Manifesto: 2020, issued by Innovate Finance, which aims to advance Great Britain’s standing as a leader in financial technology (fintech) innovation both domestically and abroad and create 100,000 jobs in U.K. fintech.
The manifesto is focused on generic fintech innovation and doesn’t mention Bitcoin- and blockchain-based digital currencies explicitly. However, Great Britain is on its way to becoming a global hub for bitcoin and other digital currencies, with both the government and Bank of England having made recent moves designed to stimulate the development of digital fintech.
Bitmain, the Bitcoin mining ASIC provider, Sunday announced the release of its next-generation Bitcoin miner, the Antminer S7, using the recently announced BM1385 ASIC.
The company argues that “this machine is not only our most efficient ever, using less than half the energy per gigahash of the S5, but it is also our most powerful miner to enter mass production.” It had released the S5+ in limited supply, which offers nearly 3,000 more GH/s than the announced S7.
“It’s true that the S5+ had a greater overall hashrate, but the S7 squeezes more juice from a smaller, more power efficient package,” said Jake Smith, Bitmain’s head of North America, in an interview with Bitcoin Magazine. “When comparing hashrate to weight, size, or power consumption, the S7 comes out ahead.”
The Antminer S7 is a denser mining rig than previous models. Whereas the S5 used 60 chips per miner, the Antminer S7 uses 162 of the BM1385 chips. Each S7 will be able to generate upwards of 4,850 GH/s while only needing approximately 0.25 J/GH of power.
Part of the reason the chip is so much stronger is because the company went away from using standard design flow methods. “From the BM1385 onwards, we’ll be using full-custom design flow,” Smith explained. While full-custom design flow is more work intensive and does have a greater margin of error, it results in greater efficiency, which is where profit can be found.
“It’s difficult to predict the how long our new chip will take to bring to market, but development on our next chip began almost as soon as this one was completed. Our next chip, the BM1387, will be our second full-custom chip, and our first chip built on a 16-nanometer process node,” Smith said.
With each new chip released miners have to weigh their options on whether to upgrade. Smith said that there has been considerable interest in the S7 by current Bitmain miners, in particular because older hardware may become obsolete. “The inevitable large deployment of S7s will cause network hashrate to rise and some older hardware to be forced offline. More recent hardware like the S5 will still be profitable, but to a lower degree than at present,” Smith said.
‘We’ll continue to make our machines available to Joe Miner …’
Bitmain has deployed a different strategy than other Bitcoin hardware companies has. Other companies have focused their development efforts on creating miners for internal use rather than widespread adoption. For example, Bitcoin Shop (BTCS) announced that it would be merging with Spondoolies-Tech, which would give BTCS access to Spondoolies’ latest miner to give it a competitive advantage. Bitmain, on the other hand, continues to sell its hardware to the general population.
“We’re very strong believers in keeping Bitcoin decentralized. Until recently, most mining was done by so-called average users and not by large mining operations,” Smith said. “It would be a real shame to see this dedicated group left without options for supporting the network in their own way, and perhaps even present a dangerous situation for the network to be secured only by large and well-capitalized firms.”
As mining does continue to get more expensive, only those companies that have the resources to create large operations will be able to survive. The fewer operations that are mining, the more likely it is that one, single source could take a majority of the hashrate, creating potential security problems.
“We will continue to make our machines available to Joe Miner for as long as we are making hardware,” Smith said. “It’s an unfortunate situation that we’re the only big ASIC manufacturer selling directly to consumers right now; we’d love to see more competition in this space and for the miners themselves to have more options available.”
Jacob Donnelly is a full-time product manager and journalist covering finance and bitcoin. He runs a weekly newsletter all about bitcoin and digital currency called Crypto Brief.
Mastering Bitcoin Author Andreas Antonopoulos recently gave at talk at Harvard’s i-lab, spending much of his time in front of a small audience describing the various issues with Bitcoin as a brand. He noted many problems with the terminology[add link to bitcoin terminology is broken and wrong piece] used in Bitcoin, and he also focused on specific products or services in the Bitcoin space that seem to be doing a disservice to potential users.
At one point during the presentation, Antonopoulos turned his attention to Bitcoin ATMs, asking the audience how many of them had used one of the machines in the past. While a few people raised their hands, those hands went down when Antonopoulos then asked how many of them enjoyed their experience with the Bitcoin ATM.
How Traditional ATMs Work
To explain the user experience issues with Bitcoin ATMs, Antonopoulos first talked about the setup of traditional bank ATMs:
“When you interact as a person with an ATM, 1. you have a pre-existing relationship with the bank or financial institution; 2. you have a pre-existing balance; 3. your primary objective is to get in, get cash, [and] get out. Twenty seconds is too long. Three clicks is too long.”
In other words, there is no need for long explanations or user-onboarding with traditional ATMs. Everyone who uses them already has a debit card, and they’ve already interacted with the corresponding bank in the past. The process can be simple because the user already has his or her bank account setup.
Bitcoin ATMs Have Nothing in Common with Traditional ATMs
According to Antonopoulos, many Bitcoin ATM developers have been looking too closely at how traditional bank ATMs work when designing their own machines. He noted that Bitcoin ATMs have “absolutely nothing” in common with the ATMs that are currently used by banks, and he went on to describe the experience an average person has when attempting to use a Bitcoin ATM for the first time:
“The average user of Bitcoin ATM is someone who has never seen bitcoin before. It is a person who doesn’t understand what bitcoin is, and the ATM is their first introduction to this currency. It is a person who does not have a pre-existing relationship with anyone in the Bitcoin space. It is a person who does not currently have a wallet because they didn’t know they needed one – because they don’t know what a wallet is (it’s a keychain). And so they walk up to this machine, and this machine has been designed by engineers to simulate the experience of an ATM, even though the experience shares absolutely nothing with the use case we’re putting it to. So you walk up and the ATM tries to give you bitcoin in as few clicks as possible with a minimum amount of interaction. Is that a way to build brand loyalty? Is that a way to build user experience? Is that a way to introduce new users? I mean, it just throws it at you, and you’re not ready for that. But, ‘Please open your phone and display your QR code.’ Like, what? What’s a QR code?”
In an effort to solidify the point that Bitcoin ATMs should not be operating in the same manner as traditional bank ATMs, Antonopoulos then went through a long list of questions that a user would likely have while attempting to use a Bitcoin ATM for the first time.
The Right Model for a Bitcoin ATM
After describing the problems with currently available Bitcoin ATMs, Antonopoulos explained how he would design such a device:
“If I was designing a Bitcoin ATM, first of all, I’d put it in bodegas. Secondly, it wouldn’t have a lick of English on it. It’d be all-Spanish because I’m going to really push the remittance model. Thirdly, the first function on the ATM would be ‘Send money to Mexico City.’ That’s it. Because I want people to use the bitcoin for something. [Fourthly], I’d have a big button on the front that says ‘Talk to a human.’ I’ve got an Internet-connected device with a forward-facing camera and a tablet screen, and I’m not using it to do video customer service? Are you kidding me?”
It’s clear that the device Andreas Antonopoulos is imagining is completely different from a traditional ATM. In addition to the focus on international remittances, Antonopoulos also expanded on the idea that the Bitcoin device needs to teach the user about the peer-to-peer digital cash system:
“I don’t want to interact for fifteen seconds. I want to interact for two hours . . . And it tells me where I can spend [bitcoin]. It gives me suggestions on wallets, and it can send them directly to my phone. It’s building loyalty, brand and experience. That’s not a 15-second interaction.”
This is a perfect example of how sometimes simply applying the old ways of doing things to Bitcoin will not work. The most impactful innovations in the Bitcoin space have been the ones that created something completely new rather than thinking about how things worked in the past. Developers and entrepreneurs should try to avoid simply replacing the carriage with an automobile. It’s time to get rid of the horse.
The venture arm of a major Canadian pension fund is reportedly looking at making investments in bitcoin and blockchain startups.
The Ontario Municipal Employees Retirement System, or OMERS[1], is one of Canada’s largest municipal pension funds. The fund’s venture arm, OMERS Ventures[2], recently disclosed in a recent interview with Canadian business publication TechVibes[3]that it was exploring the use of proceeds from a recently closed[4] $260m CAD fund to make investments in the bitcoin space.
The fund has also drawn support from the Bank of Montreal and Cisco Investments.
Managing director Jim Orlando said during the interview:
“Cybersecurity is another area we have been looking at, specifically in FinTech as Sid mentioned, and in particular what bitcoin and block chain capability bring in terms of differentiated opportunities. We hope to find a couple of investments for Fund II related to bitcoin and the block chain, and the security side of that whole paradigm.”
OMERS Ventures indicated earlier this week on its website[5] that it would place a heavy emphasis on financial tech companies, including those in the bitcoin space. An infographic[6] published by the firm included a number of bitcoin startups based in Canada.
Jeremy Almond is cofounder and CEO of PayStand, a payments-as-a-service platform. He is a frequent speaker on next-generation payment technologies, including bitcoin and the blockchain. Here, he examines whether open Internet standards and blockchain technology can rescue the last bastion of analog payments.
In today’s globally connected, digitally driven, Internet golden age, it may surprise you that when businesses pay each other for goods and services, they still pay by check.
According to a recent Goldman Sachs report[1], paper checks account for at least 50% of B2B payments. While credit cards have made consumer purchases faster and easier, the merchant fees involved are a deal-breaker for high-value B2B transactions. It’s 2015, but without a viable digital alternative, we’re now sending $26tn per yr[2] through an analog system invented 2,000 years ago[3].
But what about the hidden costs of continuing to use paper checks? When you factor in the overhead and time spent processing check payments, their actual cost is about $8 per check[4], not including losses due to human error and fraud.
All told, legacy payment systems are costing global businesses $550bn a year in direct expenses and inefficiencies.
Instead of losing funds to a leaky payment system, that’s money that could be used to create more jobs, build better products and invest back into the economy.
Money on the table
This potentially deadly combo of aging technology and mounting costs represents a once-in-a-century opportunity for businesses to modernize the way they pay each other, or risk joining the graveyard of corporate dinosaurs that couldn’t compete in the 21st century.
There’s a lot of money on the table for companies that switch to digital – $57B in net cost savings globally each year, according to Goldman Sachs’ research.
Although many Fortune 500 companies operate their payments on legacy systems that are the embarrassment of their IT staff, the ones that hold out the longest actually stand to see the most benefit from switching to digital.
Just as some third-world countries skipped over landline telephones and went straight to cellular, companies that resisted pre-Internet EFT and other proprietary systems can leapfrog straight to digital systems that are optimized for today’s Internet and mobile infrastructure.
They can even take advantage of developments of open, natively digital blockchain technology to slash the cost of payments even further.
Teaching payments a new language
Wasted money is the elephant in the room with paper checks, but there’s another big problem with legacy payment networks that could do even greater damage in the long run—the inability to track information about payments throughout the supply chain.
While organizations typically invest heavily in their ERP and accounting systems, the actual payment itself is usually not connected to these commerce engines.
In this era of Big Data, payment systems that can’t provide automated, up-to-date and globally accessible tracking information spread inefficiencies not just to accounts departments, but to all areas of a business.
So how can businesses be sure that when they move to digital payments they realize the most cost savings and be able to mine the wealth of data that payments can reveal about their operations?
The answer may lie in an open Internet technology you’ve probably never heard of – FSML, or Financial Services Markup Language.
Like HTML, FSML is a structured language developed specifically for financial transactions, including eCheck, the digital successor to paper checks.
FSML makes it possible for eCheck transactions to carry an unlimited amount of data with them, structured in an open language that can be read and shared between databases and applications.
This addresses a key limitation of analog check and legacy automated clearing house (ACH) and electronic funds transfer (EFT) transactions, which limit appended data to a handful of cryptic codes.
When a company moves from paper checks to eChecks, they gain an opportunity to append their transactions with rich data that can be synced between ERP[5], CRM[6] and vendor-facing websites. They can begin to connect the dots between procurement, accounts payable and payments, perhaps discovering inefficiencies, double-payments and even fraud along the way.
Get ready for machines that can pay each other
The eCheck standard with its underlying FSML language is an open technology that businesses can use today to digitize their payments. But this is just the beginning of how open technology can reinvent payments.
Looking out into the not-too-distant future, innovative businesses will begin to record their transactions on blockchain-like ledgers, opening up the possibility of completely automated payments between trusted parties and even between machines.
Imagine a world where commercial agreements are executed by digital smart contracts. Where the contract and payments are actually tied together by mathematical rules of the blockchain.
A commercial term like “Net-30” that obligates a business to pay its invoice in 30 days, could be automatically executed on the day it’s due. Or an agreement to pay on delivery could track that the product actually was received and signed off on as in good order, before payment is released.
Escrow systems, third-party agents, and intermediary networks could be rethought to be far more efficient.
Or perhaps even more exciting is the ability for business-to-business blockchains to enable digital native payment networks that can instantly settle funds directly between parties.
Today, electronic payments are delayed as they batch-process through third party processors and legacy networks, like ACH.
With a blockchain, rich data about the payment can be included, it can operate seamlessly across borders, between currencies and can be executed at the speed of light. Say goodbye to “the check is in the mail”.
The race is on for businesses to claim their share of the $57bn of cost savings for moving to digital payments. The ones that really think through how to integrate payments with all the moving parts of their business, and embrace open technology standards they can customize and build on, will win the lion’s share.
Disclaimer: The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, CoinDesk.
The San Francisco-based bitcoin wallet provider has successfully given away free bitcoin to more than 20,000 college students.
CyptoCoins News reported that any student signing up for Coinbase would receive $10 worth of bitcoin. Students were required to verify enrollment by signing up with an email domain ending in “edu.”
At the time Coinbase founder, Fred Ehrsam, announced the limited time offer on Twitter, it was only available to a handful of “edus.”
Now the international digital wallet has posted a list of the top 10 schools with the most signups. The University of Michigan led the way with 941 signups. The University of California, Berkeley wasn’t far behind with 939 signups, the University of Illinois had 873 and the University of Texas ranked number four with 698 signups.
Some users complained via Reddit that they were having trouble signing up. But Ehrsam quickly replied, “It’s because so many people have signed up from Berkeley today (seriously).”
Students at other colleges including Notre Dame and UCLA reported success in signing up.
Coinbase went the extra mile to ensure security by requesting students provide a phone number that could be verified.
“This extra check has greatly reduced scammers trying to take advantage of this promotion. So it allows us to keep this promotion going,” said Coinbase.
College investors
Giving away free bitcoin to college students in order to encourage investment is clever, but not new. Earlier this month, more than 4,000 MIT students enrolled in the 2014 fall semester will receive $100 worth of bitcoin.
The brains behind the program, Jeremy Rubin and Dan Elitzer, were able to launch the program after receiving nearly half a million dollars in donations from MIT alumni and the bitcoin community.
“Giving students access to cryptocurrencies is analogous to providing them with internet access at the dawn of the internet era,” said Rubin.
While many are excited about the giveaway, some are curious about what will happen if they try signing up with a school that’s not yet listed.
Others say the promotion could be taken advantage of by non-students creating an email account with the domain “edu,” which some experts say is relatively easy to do. Drew Cordell of CyptoCoins News wrote, “If the promotion is meant to have a long duration, it will need to be refined significantly in order to prevent abuse and provide full access.”
Despite Ehrsam’s reassurance that abuse will be prevented, Cordell argued, “It is very simple to create an .edu email address for free in minutes. Creating false email accounts could allow users to abuse the system and continually claim the $10 bonus if the system is not well regulated.”
By offering young people a chance to invest in Bitcoin, companies like Coinbase could be key players in expanding the market for digital currencies. This could potentially ensure monetary freedom for the future by allowing bitcoin into the hands of our youth.
Coinbase currently has over one million consumer wallets, 30,000 merchants, 5,000 API applications and U.S. bank integration. They also have a remote team consisting of 35 contractors.
Coinbase users can now send bitcoin payments without being exposed to the digital currency’s volatility.
Users with a fiat wallet (must be verified in order to get it) allows use of Bitcoin’s global payment network without being exposed to the price of the digital currency. Coinbase’s Instant Exchange deducts an equal amount to the bitcoin the user wants to send, effectively exchanging the two. The service is similar to one offered by Coinbase to bitcoin-accepting merchants.
As of today, Instant Exchange is available for users with a USD, EUR, or GBP wallet. After typing the bitcoin address and chosing a fiat wallet, users can hit the “Instant Exchange” button, and then send. A bitcoin amount equal to the fiat selected will be sent instantly, without exposing the user to bitcoin’s notorious volatility. The startup’s standard conversion fee of 15 cents will be deducted from each conversion, but sending payments to other Coinbase users is free.
The bitcoin is deducted from the user’s fiat wallet and not his or her digital currency wallet, meaning it can also serve as a way for users to instantly sell their bitcoin.
A different model
Volatility is a problem all too well-known in Bitcoin and is a chief complaint among people interested in using the technology’s payment network. Many services have looked to solve this problem by offering the ability to “lock” bitcoin to the price of the American dollar, British pound, and various other fiat currencies. Users can then unlock their bitcoin when they want to send them or be exposed to the digital currency’s price.
Latin American bitcoin startup Coinapult was first to launch such a service, but now many bitcoin businesses offer it, including Bitreserve, which designed its whole service around the concept.
One issue with these services is that though it makes storing the currency safer, it does not solve the problem when sending the digital currency. Also, if bitcoin’s price goes down, these businesses offering the ability to peg bitcoin will lose money. And though the price has been more stable in recent months, bitcoin’s price has declined dramatically over the last year, meaning that many “lock” services could be feeling some pain.
Coinbase’s model avoids the potential risk of being on the strong side of a price swing by exchanging bitcoin for dollars instantly, and not operating a one-to-one reserve (peg).
