While the price of bitcoin continues to remain volatile, more uses for the world’s most liquid crypto currency continue to make their way into the mainstream. This week at CoinDesk’s 2018 Consensus conference, RSK, is poised to announce its new technology that will bring smart contracts, similar to Ethereum to bitcoin. The new smart contract called sidechain will allow users to lock in smart contracts based off of block chain technology using bitcoin as their payment methodology. So, while bitcoin trading continues to expand its presence, new uses continue to generate interest.
New Technology Driven by Bitcoin
In January of 2018, RSK established its new technology sidechain, which is pegged to bitcoin. To engage in a sidechain transaction you would still need to receive the approval of a group of third party participants known as “The Federation”. While there are likely further adjustments needed to make smart contracts seamless on sidechain, 80% of miner have already volunteer to support sidechain.
Sidechain is geared to be a smart contract that will allow users to feel comfortable that their transaction cannot be altered. For example, a consumer in the United States could purchase certified organic corn from a farmer in Turkey and not have to be concerned that the shipment would be fraudulent. Sidechain was created to be merged mined where miners get transaction fees by allowing their power to be used to create a sidechain traction in a similar way power is used to mine bitcoin. This will further buoy the bitcoin ecosystem as it allows miners to benefit from transactions that are now specific related to generating a bitcoin.
Sidechain transaction are also more efficient than standard bitcoin mining. Smart bitcoins run on a different blockchain version of code with smart contract capabilities which allow improved efficiency. While RSK is very upbeat about their launch they do acknowledge that they are at the beginning of the process and far away from bringing this technology to the masses. The technology that is use is similar to the Raiden network used to facilitate transaction between bitcoin and ethereum.
RSK is investing in the Crypto Space
Two companies have recently join RSK. Inter-American Development Bank, is an Argentinian NGO that promote inclusion in Buenos Aires. BitGive Foundation, is a bitcoin-focused charity organization that’s been used to funnel bitcoin donations to Nepalese citizens affected by a devastating earthquake in 2015.
Crypto Currency Volatility Remains Robust
Bitcoin prices have been trading sideways and have been very choppy since hitting a low in February. The move up in December and subsequent decline has reduced liquidity. Many traders who would like to be involved in bitcoin trading are waiting for prices to resume their uptrend, after becoming frustrated by the recent sideways price action. Volatility and liquidity are tantamount for new businesses that are attempting to get into the bitcoin trading business. With large investment banks like Goldman Sachs recently announcing new trading operations that are crypto currency related, liquidity in bitcoin is likely to improve.
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