Crypto ₿its: Bitcoin Celebrates, $30mm ETH Hacked, Irresponsible ICOs & John McAfee’s 🍆
July 21- Issue #5
Crypto ₿its is a weekly curation of links, commentary, tweets and news I’ve seen across the crypto world and thought were interesting. You can follow me on twitter @callmethebear . Not getting Crypto Bits? Click here to subscribe!
News:
Bitcoin scaling debate and nuclear option has been avoided.

Man oh man oh man what a week in crypto land. The amount of craziness that occurs on a daily and weekly basis feels like you are aging 25 years. The entire space is like weirdo mix between the wild wild west and the dot com boom. There are so many exciting(and terrifying) trends, developments and issues to follow and keep up with that sometimes it’s even hard for me to keep it all straight. For those just getting into the crypto world, I know a lot of this will feel overwhelming, so I’ll do my best to break it down into shorter more digestible bits.
What a difference a week makes
As of press time last week, the clash of Bitcoin communities were on a collision course that appeared headed towards a chain split. For newcomers, this would have created two different Bitcoins and a devastating impact on everything Bitcoin has worked towards for the last 8 years. Price action was ugly going into the weekend hitting lows of &1800 as the market began penalizing Bitcoin and discounting the very real possibility that the a chain split was inevitable……And then over the weekend a miracle happened. The miners began signaling for BIP91, a protocol upgrade designed to allow Bitcoin to avoid a chain split and lock in place a larger effort to upgrade bitcoin called Segwit2x.
While BIP91 is locked in, there is no guarantee SegWit gets activated unless atleast 95 percent of miners (by hash power) signal support for the upgrade for the next two-week difficulty period. The very controversial but much needed protocol upgrade improves the transaction structure of the network through the “Segregated Witness” fix(probably too confusing to explain how ti works right now) which will help increases the amount of data that can be stored in transaction blocks. This is a first step in making bitcoin less congested, more robust and able to handle faster/instant payments down the road through lightning transactions.
$30mm in Ether where hacked/stolen by exploiting a vulnerability at a Wallet provider
Hackers have stolen $32 million worth of Ethereum by exploiting a critical security vulnerability in wallet software that allowed an attacker to steal over 153,000 Ether. The attack began late on Tuesday and continued on Wednesday in a total of three transactions.
When the attack was finally noticed, a group of white hat hackers used the same exploit to drain money from other vulnerable wallets in order to protect them from the theft. The money saved totaled 377,000 ETH worth over $75 million.
This follow a different hack several days earlier when CoinDash.io had their website compromised when a hacker replaced the Ether Wallet address during an Initial Coin Offering and tricked victims into send $7.2mm to his account.
To get a more technical analysis of exactly what happened, check out this excellent blog post.
John McAfee made a bet to eat his d*ck 🍆 on Live TV if Bitcoin price is not $500,000 in 3yrs
In a passionate series of tweets, John McAfee, the bizarre, brilliant and borderline psychopathic cybersecurity software legend literally put his his d*ck on the line about the future of Bitcoin. The guy was dead serious and was looking for takers at 5:1 odds. I don’t know about you but I’d rather not have to make a decision to watch that which now gives me 2 really good reasons for Bitcoin to be $500,000 in 3yrs. SMH 🤦🏼 🙅🏽 h/t cryptotraveler

Stuff worth reading
I’ve been told I’m including too many links in this section and that it’s a bit overwhelming…I consume a lot of information which helps me connect the dots so I can better understand everything that is moving around me. I’ve been sharing links I find relevant but I’m gonna dial it back and only share the top 5–10 each week with some context instead and see how that goes for a while. Shoot me an email with feedback as to whether you’d rather see more links or less links or more links with more context.
Is Ethereum the Kickstarter of the Cryptocurrency World? As token sales become the hot new market for raising blockchain related capital, is Ethereum contributing to a problem where developers are taking irresponsible amounts of money with no working product? — Vice/Motherboard
Top 100 Blockchain Insiders: Want to know who to follow on twitter and blogs to keep up with the inside scoop in the blockchain world? From Marc Andreessen to Vitalik Buterin, These Are the Most Influential People in the Crypto Sphere — Richtopia
Easy Come, Easy Go — Fred Wilson of Union Square Ventures talks about how bubbles attract the wrong kind of people chasing money but how those in crypto are not about the money but the mission: a global decentralized platform for innovation — AVC
Why Tokens are Eating the World — Vinny Lingham of Civic, an identity verification platform explains how the primary value of the token infrastructure provided by blockchain technologies will be related to the adoption of the infrastructure, the cost of transactions and network security. Vinny Lingham/Medium
Thoughts on Tokens — Tokens are early today, but will transform technology tomorrow. — Balaji S. Srinivasan explores how tokens are beginning to permeate every facet of our society. — 21.co/Medium
BIP 91 Has Locked In. Here’s What That Means (and What It Does Not) — BTCMagazine/Aaron Van Wirdum
Getting started resources:
Several people have asked me what they can read to get started figuring out the ins and outs of Bitcoin. I am going to create a running resource of links below as starting points. I have a lot of stuff so I will begin curating it with what I find to be relevant yet easy to understand. For now try these:
What is Bitcoin? A Step-By-Step Guide For Beginners
How To Buy Bitcoin Anywhere in The World (Ultimate Guide)
What is An Ethereum Token: The Ultimate Beginner’s Guide
Dapps And The Decentralized Future
A Gentle Introduction To Bitcoin
A Gentle Introduction To Blockchain Technology
A Gentle Introduction To Digital Tokens
Price Action
BITCOIN (BTC) was up $435.56 (18.99%) over the past week with total volume over $8.77B. Bitcoin hit a low on Sunday morning of $1,808 before rallying all the way up to $2,932 yesterday on news that SegWitness has been locked in. Similar to last week, trading was driven by fear of a chain split until Sunday when miners surprisingly began signaling for BIP91. I can’t understand the following statement enough: Bitcoin has had a scaling overhang for almost 2 years and while it will be two weeks before activation of the major protocol upgrade, the future of Bitcoin is as bright and clear as I’ve ever seen it. This is a bright green light and screaming buy opportunity.

ETHEREUM (ETH) rebounded $32.67 (17.06%) week over week with a heavy volume of $11.5bn. Ethereum hit a low of $132.64 on Sunday, July 16 before rebounding sharply to $256.89 on news that Cisco and Mastercard joined the Ethereum Enterprise Alliance. This news was short lived as a massive hack and theft of $32mm in Ether was discovered Wednesday through a vulnerability in the Parity Wallet, effecting several recent ICOs that just raised funds. In spite of the almost 65% pullback from all time highs and the recent hack, Ethereum is showing signs of resiliency and is beginning to show signs that the worst is over. I’m a buyer at these levels.

LOL 😂
I’m a low key birthday person and I don’t even like cake(yes I know that’s weird), but if anyone close to me is paying attention, I WANT THIS CAKE when my bday comes around next year!!!! h/t Neeraj Kumar Agrawal

Initial Coin Offerings (ICO’s)
Recent irresponsible raises by Bancor and Tezos as well as the Parity wallet hack mentioned above and the Coindash website address hack have put a dark heavy cloud over the ICO market. The market is incredibly dangerous right now and the rush to get that money is perpetuating greed and bad behavior like I’ve never seen.
There is absolutely no transparency, standards or best practices being utilized and the large sums of money being raised are a fcking joke. I went to a recent meetup/roadshow in last night in LA for Unikrn to learn more about their ICO and experience first hand what the team and underlying token is about and I am seriously appalled at what I heard. It goes against EVERYTHING the token economy is about. The fact that Mark Cuban is endorsing this is dangerous in and of itself.
I plan on gathering my thoughts and will put them on paper in a separate medium post. For now, I would stay away from ICOs. The get rich pipe dreams is over and this market is on tilt.
Links I’m reading on tokens
- Here’s How Entrepreneurs Are Making Cryptocurrency Mainstream and Starting a Revolution — Inc
- With ICO Coming Under Attack, Market Participants Still Wary of Govt Regulation — Cointelegraph
Required Reading:
- The Bitcoin Model for Crowdfunding (2014) — Naval Ravikant/Startupboy
- What are appcoins? — Coincenter
- What I look for in cryptocoins — Blog
Noteworthy things this week
- **Crypto Currency Conference Call ALERT***

Interested in learning about the token economy and ICOs? Sign up to listen to Lou Kerner with three ICO thought leaders who will each talk about the ICO ecosystem from their perspective, helping put ICOs in to greater context for everyone:
Vinny Lingham — Co-Founder & CEO at Civic
Adam Perlow — CEO at Zen Protocol
Stan Miroshnik — CEO at The Element Group
Click here to register for the call on GoToWebinar.
Bitcoin Sign Guy Update. As discussed lat week, Bitcoin sign guy is a LEGEND and not only was he rewarded with $15,000 from the community but he just secured a full time job for his gorilla marketing efforts that went viral and trolled Fed Reserve chair Janet Yellen. Awesome!

The Bitcoin Economy. Check out this simple and easy infographic on how Bitcoin’s decentralized p2p network actually works. Yes, yes I know it’s confusing but once you grasp the concept of how this network allows for permissionless transfer of value and the role of miners to approve transactions through consensus you’ll begin understanding why its so powerful and immutable!

📌 PINNED POST: This is a much watch this video that I’m going to pin to the newsletter for the next few weeks. This recent talk by Ethereum founder Vitalik Buterin: The CryptoEconomic Way is one of the best things you can watch to understand how blockchains enable user empowerment through cryptoeconomics.
Twitter Spotlight
True believers in the space believe in a decentralized future and are working together that
Gold bugs hate Bitcoin as much as NeoCons and NeoLiberals hate peace. When the gold bugs capitulate — and they will capitulate soon, the force of buying and transfer to the new store of value unit is going to be incredible.
I’m with George. A-Motherfcking-Men! 🙌🏽 🙌🏿 🙌🏻
That’s it for this week. If you liked what you read, share this with your friends and colleagues. I’m hoping to contribute weekly and if you want to subscribe directly to Crypto Bits, my Bitcoin/Crypto newsletter you can subscribe directly HERE.
-Adam
