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Blockstream Exec Identifies Bitcoin SV Multisig Bug

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Bitcoin SV has been one of the most controversial crypto-asset to ever exist. In the latest news, a BSV user reportedly lost nearly $100,000 due to a multisig script bug. The hackers purportedly exploited the network vulnerability in a bid to steal the assets of a user.

Adam Back, the CEO and Co-founder of Blockstream said,

“Wow, that’s a nasty BSV-only bug. Less than or equal instead of greater than or equal (number of signatures in a multisig). Presume they removed the standard p2sh multisig and replaced with this bugged home-brew multisig due to BSV anti-soft fork posturing, to undo soft-forks.”

The exploit was noted by another Blockstream Co-founder, Gregory Maxwell. Following which well-known Podcaster, Ruben Somsen tweeted,

So what happened with Bitcoin SV?

According to Maxwell, BSV ripped out P2SH from their consensus rules which left the Bitcoin SV ecosystem in a situation where they had to “home brew their own multisig crypto”. The solution to this was “electrumsv” which apparently is just a script that looks like a P2PKH [pay to pubkey-hash]. However, it adds up the number of passes and compares them to a threshold.

The exec went on to explain that the consequence was that these scripts had no security at all and furthermore could be spent by a script that sets is to zero valid signatures. While no real funds were lost and that the flaw was likely accidental, Maxwell added,

“Assuming the flaw was accidental, the error could have been avoided with even the most basic testing or review.  This situation would have been avoided entirely had BSV not ripped out the competent, time tested, and highly peer-reviewed mechanisms for multisig by Bitcoin in favor of far less efficient homebrew crypto. Yet again, we see that bamboozlement and competence are not good bedfellows. Leave it to BSV to make the YOLO incompetence of ETH land look comparatively reasonable.”

This is not the first time that Maxwell identified a potential bug in BSV. Even in December 2019, that could be executed to steal unsplit funds of BTC users on the Bitcoin SV chain.

Despite the recent turn of events,  BSV’s price action has not shown even a little reaction as it continued to move inside the range. At the time of writing, it was being traded at $165.12 after a minor surge of 1.68% over the past 24-hours.

Venezuela Citizens To Have 24/7 Access To Bitcoin With Blockstream’s Satellite Node

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Developed countries steering towards the adoption of technological developments, developing countries, and underdeveloped countries aren’t lagging behind. Particularly in the adoption of cryptocurrencies, the latter has been keener on the topic. Venezuela stands as substantial proof of the same. The latest news from the country further emphasizes its interest in cryptocurrencies.

Satellites To Address Internet Issues

The economic instability in Venezuela has left its citizens as well as the government veering towards cryptocurrencies for relief. While attaining proper internet connectivity could be a task in certain regions of the world, satellite nodes have come as a ray of hope. Utilizing Blockstream’s technology, Anibal Garrido and AnibalCripto set up the space node in Venezuela. The prominent crypto startup, Cryptobuyer reportedly spearheaded the entire event, as it provides services related to Bitcoin across Central and South America.

In its blog post, Cryptobuyer pointed out that the latest infrastructure eliminates the necessity for a local internet connection to access Bitcoin. Employing Blockstream’s EUTELSAT-113, the startup carried out its first transaction through the satellite and emerger successful.

Stressing the importance of addressing real-world problems, the CEO of CryptoBuyer, Jorge Farias said,

“For example, we already deployed Bitcoin ATMs and Bitcoin point-of-sale terminals across the region, and also launched a fiat-crypto exchange platform. Now with the Bitcoin satellite node, we address the local issues of internet connectivity in Venezuela. Users can’t afford to be cut off from the Bitcoin network!”

Adam Back’s Blockstream made an entry to Central America with this latest partnership and would reportedly prolong it. The capital of Venezuela, Caracas, and Boliver State are yet to have nodes installed.  At present, this Bitcoin satellite is limited to the residents of Valencia. Furthermore, Cryptobuyer intends to cover the entire county allowing users within the proximity of the satellite nodes to connect via local mesh networks.

Anibal Garrido, the CEO at AnibalCripto also commented on the latest innovation. Garrido stated,

“Having a 24/7 always-available digital money system independent of local internet infrastructure is now a reality.”

While the electricity, as well as internet services in Venezuela, are considered to be below average, the latest innovation could aid the adoption of crypto in the country.

DeFi Mania Eclipses Bitcoin’s Sidechain Liquid as Latter’s Figure Stagnates

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Despite being the undisputed leader of the cryptocurrency realm, Bitcoin blockchain has been riddled with scalability issues. Due to this, many implementations have been tried and tested to make the network more efficient.

One such is Blockstream’s sidechain-based settlement network, Liquid’ which is essentially a second layer solution for traders and exchanges, that enables faster, more confidential Bitcoin transactions and the issuance of digital assets.

L BTC in circulation

Despite being heralded as a promising solution to the network’s scalability problems, Liquid network figures appear to have stagnated. The circulation of L-BTC was on an uptrend since the beginning of the year. Rising from 600 L-BTC to 2,054 L-BTC, recording a growth of more than 242% in a period of just four months. However, post-April, the momentum appeared to have weakened. At the time of writing, there were 2,593 L-BTC in circulation, a rise of just 26% since April.

Ethereum- the unofficial sidechain for Bitcoin?

skew bitcoin defi lightning wbtc value 1

Interestingly, this stagnation in Bitcoins locked on the popular sidechain coincided with the explosion of DeFi. The Ethereum network is becoming Bitcoin’s largest second layer network. This was evident from the fact that the number of Bitcoins “wrapped” and flowing on the Ethereum blockchain has been increasing at an incredible rate.

TWJ had earlier reported that Wrapped Bitcoins’s market capitalization hovering a little below $500 million.

Second-layer solutions struggle as Bitcoin continues to be channeled onto the Ethereum blockchain

Additionally, the total value locked [TVL] for BTC-pegged ETH tokens has surpassed both Liquid as well as the Lightning Network platform combined. At the time of writing, BTC locked in LN was just 1,068. While this does not give the full picture as Bitcoins held on LN is much higher than what is available with public data and not the ones from the private channels, this, however, tells us that the second layer solution is struggling to add more liquidity.

Full Fledged Cryptocurrency Bank in Works as Caitlyn Long Emphasizes Digital Asset Importance

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As time progressed, more and more people entered the cryptocurrency industry, with institutions becoming the main target for digital asset companies. The influence of mainstream players has also brought the industry to the fore.

According to new reports, Caitlin Long who shot to fame for drafting Wyoming’s blockchain legislation has decided to launch the US’ own bank for digital assets. 

Long has begun to prepare to apply for the Special Purpose Depository Institution [ SDPI ] with Wyoming’s banking division. The digital asset bank, titled Avanti, will aim to provide regulated services for virtual assets in the state. Avanti will collaborate with Adam Back’s Blockstream to provide digital asset services to its users.

According to Long:

“I’ve founded Avanti with key support from top people in crypto and important innovators from traditional finance. Seed funding round recently closed. Avanti will serve institutional customers that need services around Bitcoin and cryptoassets. Thanks to the wise Wyoming legislature and Governor Gordon, Wyoming paved the way for such banks to exist via its special-purpose depository institution (SPDI) law.”

Avanti is expected to be launched sometime in 2021 with plans to improve the ecosystem already in operation. The cryptocurrency bank has already raised one million in seed funding with more prospective investors in waiting. Long claimed that the burgeoning cryptocurrency industry was too hard to ignore and it was high time that people tap into it.

Long believed that the United States banks and trust companies just did not have the resources to navigate the fintech world. She claimed that Avanti will enable the US to compete with other crypto-interested countries such as China and Japan. The Wyoming SPDI on their part has placed stringent requirements for the bank to pass before it can come to fruition.

The association with Blockstream will allow multiple features to be integrated into Avanti. These features include multisig signing-as-a service and upcoming native Blockstream features. Avanti’s policies list that it wants to be fundamentally different from mainstream banks by providing cutting edge technology to its account holders.

Proponents of the field have begun studying what Avanti can offer to the cryptocurrency populous on launch. The partnership with Blockstream will enable Avanti to build adjacent APIs and conventional banking APIs. Adam Back, the CEO of Blockstream also announced that they will push everything to make Avanti a one-stop-shop for cryptocurrency custody.