Bitcoin, digital currencies, and blockchain technology had another explosive year in 2016. As Bitcoin broke the all-time high in USD market capitalization, several new digital currencies also took a spot in the limelight, while the blockchain buzz arguably peaked.
Of course, Bitcoin Magazine has kept up with all of this. Looking back on 2016, we have put together three top 6 lists with our most-read topics from the fields of technology, business and news.
These were the top six news items of 2016 by popularity.
6. IRS instructs Coinbase to transfer customer data
The Internal Revenue Service (IRS) surprised the Bitcoin community in late November.
The US tax authorities have instructed the large exchange and de facto wallet service Coinbase to hand over customer data for all users who bought Bitcoin between 2013 and 2015 “Johannes tut”. The request may also be a sign that the IRS is taking a more proactive stance toward digital currency users and businesses in the United States
Shortly after the motion was filed, Coinbase condemned the IRS’s move and announced that it would challenge the order in court. About two weeks ago, a Los Angeles attorney also urged a federal judge to stop the IRS investigation. And just yesterday, the IRS asked the court to dismiss the motions.
In fact, the story is still developing; but it has already secured a # 6 spot on our top news for 2016.
5: The rise and fall of the DAO
The DAO hit the headlines in 2016. As a DAO (Decentralized Autonomous Organization), the DAO was a code-based investment company built on top of Ethereum, where shareholders were the decision makers of the project. By May of this year, the DAO had raised more than $ 150 million worth of ethers, breaking previous crowdfunding records.
And then it was gutted.
Due to a bug in the code (or, as the perpetrator might argue, a feature) someone was able to withdraw millions of dollars worth of ether from The DAO in June. Even before the “company” had made an investment, the project had pumped out around a third of all funds.
What followed was a game of cat and mouse between the developers of The DAO and Ethereum and the hacker; a compelling saga for Bitcoin Magazine readers that earned it fifth place in our top 6 news items for 2016.
4: Bitcoin cloud services revealed as a cloud mining Ponzi scheme
With an exclusive story published in June, Bitcoin Magazine revealed the alleged cloud mining service “Bitcoin Cloud Services” (BCS) as a seemingly blunt Ponzi scheme.
It found that both images and videos of the hardware facility were edited with Photoshop to deceive and defraud an estimated 4,300 customers. Instead of paying out profits from mining, the company was most likely paying old users in money invested by newer users while keeping some of it. A simple scam, actually.
Unsurprisingly, BCS is no longer active; it appears that its operators ran away with estimated loot of up to 2,500 bitcoins, which were worth well over $ 500,000 at the time.
3: Craig Wright’s “Satoshi Nakamoto” saga
Another year, another Satoshi Nakamoto.
In May, Australian computer scientist and businessman Craig Wright “revealed” himself as the man behind the nickname of Satoshi Nakamoto, the inventor of Bitcoin. Big media outlets like the BBC and The Economist covered the news, while the claim was also supported by several prominent figures in the Bitcoin community. Above all, the former Bitcoin core lead developer Gavin Andresen – but also the New Liberty dollar issuer Joseph VaughnPerling and others.
However, when it came to providing cryptographic evidence of his claimed second identity, Wright failed. While Wright posted a signature created with a private key that only Satoshi Nakamoto was supposed to control, it turned out to be a publicly available signature found on Bitcoin’s blockchain.
Wright apologized with a strange apology, claiming he couldn’t prove who he was. And while some still hold on to their belief that Wright really was the inventor of the breakthrough digital currency, most have since dismissed the possibility.
2: The halving
When bitcoin first hit the market, miners made 50 bitcoins for every block they mined. But that number is halved every four years, or more precisely: every 210,000 blocks. This ensures that Bitcoin’s block reward will eventually drop to zero, capping the total amount of Bitcoins that will ever be in circulation to 21 million.
2016 was the year of the second halving of the block reward. July 9th, known as the “halving,” was the day Bitcoin’s block reward dropped from 25 new Bitcoins to 12.5 – not including fees. It marked a key moment in Bitcoin’s history, as reflected in the popularity of the topic in Bitcoin Magazine, and secured a second spot in our top 6 news items for 2016.
1: “The” Ethereum hard fork and the birth of Ethereum Classic
The rise and fall of The DAO was one of the biggest news of 2016. But its aftermath was even more significant.
In order to compensate The DAO’s investors, the Ethereum Foundation ultimately decided to hard fork the Ethereum blockchain. It was a controversial decision as it challenged both the “Code is Law” mantra and the “amorality” claims long perpetuated by the creators of The DAO as well as the developers behind the Ethereum project itself. In addition, not all users agreed to the hard fork. While polls and other data suggested that a majority within the Ethereum community supported the radical solution, a sizable minority did not.
Some of these users disagreed with the Ethereum Foundation’s decision so strongly that they refused to switch to the new version of Ethereum at the hard fork in July and continued to use the “original” Ethereum blockchain. As a result, the network and the currency of Ethereum split in two. Instead of one Ethereum there were several: “Ethereum” and “Ethereum Classic”.
Both Ethereum and Ethereum Classic chug on to this day. And while the combined market cap of the two has plummeted since the highs of Ethereum, both digital currencies claim a top ten spot by market cap.
And a number one place in our top 6 news for 2016.