Sept. 29th: Ethereum Istanbul Upgrade Breaks Smart Contracts

This Week in Crypto


Sept. 29th: Ethereum Istanbul Upgrade Breaks Smart Contracts

This is your daily roundup for Sunday, September 29, 2019. Ethereum’s Istanbul upgrade breaks smart contracts on Aragon, Ripple acquires Algrim, and BK Global falls short of paying up for it’s $333 million acquisition of Bithumb.

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EnHelix Launched On Hyperledger Fabric

EnHelix has launched on the Hyperledger Fabric blockchain for commodities trading in the gas industry. Enhelix’s blockchain solutions for the oil and gas sector comprise three major systems including Marketplace, Logistics and Settlement.

The software streamlines commodities trading with applications supporting every step of the process, including pre-trade KYC, trade execution and post-trade risk management. Automated systems and smart contracts make the energy trades faster and more organized for users.

Ripple Acquires Algrim

Ripple has acquired Iceland-based crypto trading firm Algrim. Algrim had been developing a crypto trading platform that integrated with more than 30 markets. Six Algrim engineers will join Ripple in expanding cross-border payment corridors and contribute to the ongoing development of the company’s on-demand liquidity product, focusing on integrations with partner crypto exchanges. 

On-demand liquidity through Ripple’s xRapid cross-border payment service allows companies to transfer funds from one currency to XRP and from XRP to another currency. Ripple says it has more than a dozen customers using XRP for cross-border transactions.

BK Global Falling Short Of Bithumb Acquisition

BK Global is falling short on its acquisition of Bithumb. In October 2018, BK Global had agreed to buy a 51 percent stake in Bithumb from BTC Korean Holdings for $333 million. Since the deal was brokered, BK Global reportedly made a down payment of $100 million.

According to sources from The Korea Herald, BK Global pushed back it’s April deadline for completing the purchase, and once again missed a Sept. 30 deadline for the final payment. BK Global was allegedly seeking various partnerships or buyouts to secure the remaining capital for the acquisition, and increased its share to 70%. Bithumb has since stated that the exchange has stable management, so there won’t be any impact should the deal collapse.

Crypto Rating Council

Coinbase has announced the launch of its Crypto Rating Council, a member-operated organization formed to assist digital asset firms to comply with U.S. securities laws. Anchorage, Bittrex, Circle, DRW Cumberland, Genesis, Grayscale Investments and Kraken have joined the initiative. The council rates tokens between one and five. A score of one means a token has few similarities to a security and a score of five means a token resonates strongly with being a security.

The council has rated 20 crypto assets, rating XRP, maker (MKR) and polymath (POLY) as likely to be securities. Bitcoin was rated as likely to not be a security due to the absence of a marketed token sale and anonymity of the project team. There has been much controversy over the rating system though, Binance CEO CZ tweeted “The guys who score above 2 should form their own counsel and re-rate everything again.”

Ethereum Istanbul Upgrade

Ethereum’s Ropsten test network is undergoing a hard fork upgrade known as Istanbul. A new EIP will be implemented to address increasing computational cost.  EIP 1884 will increase the gas prices of three resource-intensive operations. The SLOAD operation will increase gas cost by 4 times from 200 gas per operation to 800 gas per operation. This increase in gas will break 680 smart contracts on Aragon and will increase prices for end-users on the Kyber Network.

The smart contracts on Aragon typically manage the governance of DApps running on ethereum. Aragon One CTO Jorge Izquierdo told CoinDesk that forced upgrades are required for the affected smart contracts in order to ensure DAOs built on Aragon continue to function smoothly. Before the fork is implemented, DAOs could receive ETH from one another, but after the fork DAOs on Aragon would essentially run out of gas.

Istanbul is expected to introduce a more efficient network. Blockchain researcher Mihailo Bjelic said Monday that bad developer practices are likely the cause of such hiccups, rather than the nature of the upgrade itself, stating “Developers should definitely not be hard-coding assumptions about gas cost into their applications because these numbers can change at any point.”



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