Blockchain's million dollar giveaway to crypto users
51 views · Published 13 November 2018 · 4:36 · Indexed 21 September 2026
Channel: AP Archive · 2018 · News & Politics
(7 Nov 2018) LEADIN: A crypto company is giving away 125 million US dollars in digital currency, in what's claimed to be the largest ever consumer giveaway of its kind. Ten years since a white paper gave birth to Bitcoin, the future for cryptocurrencies remains anything but clear. STORYLINE: It's a giveaway with a difference. In what's claimed to be the largest consumer so-called "airdrop" of its kind, company Blockchain is giving away 125 million US dollars in cryptocurrency. Users of the company's Blockchain Wallet, who currently number about 30 million, will be able to claim $25 USD worth of Stellar Lumens, a digital currency launched in 2014. Blockchain co-founder and CEO, Peter Smith says it's about encouraging people to get involved with cryptocurrencies. "So, we're really passionate about user-controlled finance, putting people directly in charge of their money, having custody of their own funds. And what we're hoping this does is gives more people the opportunity to do this for a really low cost, low friction method," says Smith. "So, what we're excited about doing and hoping to do is introduce millions of more people to crypto." Smith says the giveaway will be staggered to a smaller amount a day for six months - about two million USD a day - so as not to provoke a drop in value. He says the money was supplied by the Stellar Development Foundation. Stellar Lumen (XLM), that's currently valued at about 25 US cents, gained in value by about 4 percent following Smith's announcement. "I became interested in cryptocurrency as a way to build a new financial system," says Smith. "When you go back through history, you see that every financial system has some healthy manager of greed, some measure of utility, and then some measure of risk management. "In the crypto system, we have utility, we have a lot of greed and speculation, but we don't yet have risk management. "What I mean by that is insurance products, products that pool risk collectively. But it's early days, our modern financial system took 150 years to develop, we're only maybe seven, eight years into the whole crypto currency financial system." Cryptocurrencies are a hot topic at Lisbon's annual Web Summit tech conference, with several associated companies exhibiting, including Luxembourg-based bitcoin exchange, Bitstamp. Virtual currencies, also known as tokens, are electronic alternatives to traditional money. The appeal of cryptocurrencies like bitcoin lies in their use of "blockchain technology" that records all transactions in a digital database while keeping identities private, allowing users to sidestep government or banking system oversight. Speculation has also played a part in their popularity: bitcoin's price skyrocketed late last year to more than $19,000 USD though it has since tumbled and is now trading at around $6,300 USD. Financial regulators worldwide have been scrambling to deal with the rise of cryptocurrencies. Ten years since a white paper gave birth to bitcoin, critics argue cryptocurrencies are far from ready for widespread use, often pointing to the large amount of energy used to "mine" the digital tokens. "The way that people treat it is; 'It's my electricity, I'll spend it on what I want,' that's the current situation," says David Gerard, author of "Attack of the 50 Foot Blockchain". "But we're at the stage where bitcoin, just mining bitcoins, uses as much energy as Austria, like a whole country. Lisbon's Web Summit runs 5-8 November at the Portuguese capital's Altice Arena. Find out more about AP Archive: http://www.aparchive.com/HowWeWork Twitter: https://twitter.com/AP_Archive Facebook: https://www.facebook.com/APArchives Instagram: https://www.instagram.com/APNews/ You can license this story through AP Archive: http://www.aparchive.com/metadata/youtube/364aa489a7c6a60355270518f22e3080
