Venezuela&#39;s opposition gathered enough signatures to proceed with efforts to call a referendum on removing President Nicolas Maduro, electoral authorities said Monday, without setting a date for the next step. 
 
The head of the National Electoral Council (CNE), Tibisay Lucena, told a press conference Maduro&#39;s opponents had cleared the threshold of 200,000 valid signatures on a petition demanding the leftist leader face a recall referendum. 
 
The opposition blames Maduro for an economic implosion that has seen food shortages, hyperinflation, violence and looting erupt in the once-booming oil giant. 
 
The council did not set a date for the next stage of the lengthy recall process, in which the opposition must collect four million signatures in just three days. 
 
In a boost to the Maduro camp&#39;s claims of rampant fraud, Lucena said the authorities had detected more than 1,000 apparently falsified signatures. 
 
The opposition submitted 1.8 million signatures in May calling for Maduro to face a recall, 1.3 million of which were accepted by the council. 
 
Signatories then had to show up at electoral offices to validate their identity with fingerprint scans. 
 
The threshold was one per cent of the electorate, or roughly 200,000 signatures which the opposition cleared. 
 
&quot;The certification will be granted by the (CNE) secretariat,&quot; Lucena said. 
 
That enables the main opposition coalition, the Democratic Unity Roundtable (MUD), to formally request a recall vote. 
 
However, Lucena said more than 1,000 fingerprint scans did not correspond with the signatory&#39;s identity, more than 400 were repeats and nearly 200 people tried to register more than once. 
 
&quot;The electoral authority will ask the state prosecutor&#39;s office to investigate the potential usurpation of identity committed by some citizens,&quot; she said. 
 
A recent poll found 64 per cent of Venezuelans would vote to remove Maduro. 
 
But to get there, the opposition first has to collect another four million signatures in three days, at a yet-to-be-decided time. 
 
To win the ensuing recall referendum, Maduro&#39;s opponents would need more votes than he won the presidency with in 2013 around 7.5 million. 
 
Time appears to be on the president&#39;s side. 
 
His allies have an arsenal of possible delaying strategies. They have filed more than 8,000 legal challenges against the recall petition and called on the electoral authorities to ban MUD for alleged fraud. 
 
The opposition is racing to force a referendum by January 10, the cutoff date to trigger new elections four years into the president&#39;s six-year term. 
 
After that date, a successful recall vote would simply transfer power to Maduro&#39;s hand-picked vice-president.US Secretary of State John Kerry urged Venezuela not to stall. 
 
&quot;The Venezuelan constitution guarantees Venezuelans the right to have their voices heard through the referendum process. And we call on Venezuela`s authorities to allow this process to go forward in a timely and a fair manner, and not to play a game of delay,&quot; he said in Washington. 
 
MUD, a motley coalition of opposition parties, accuses the electoral authority of being in bed with Maduro. 
 
They are hoping pressure from Venezuelans desperate over the collapsing economy will force the government&#39;s hand. 
But MUD has struggled to rally mass protests. 
 
Many Venezuelans are too busy standing in line for scarce food and basic goods. 
 
Maduro has declared a state of emergency and given his military sweeping powers over food production and distribution. 
 
Venezuela has sunk into crisis as global prices for its main export, oil, have collapsed. 
 
Its economy is facing its third year of deep recession this year. Its inflation rate is the highest in the world, forecast to top 700 per cent this year. 
 
The economic tailspin is threatening 17 years of socialist rule under Maduro and his late predecessor, Hugo Chavez. 
 
The opposition won legislative elections in December, only to find its power stymied by the Supreme Court, which it says is also in Maduro&#39;s pocket. 
 
(AFP)

According to National Electoral Council, Maduro's opponents had cleared 200,000 valid signatures to call referendum

Venezuela's opposition gathered enough signatures to proceed with efforts to call a referendum on removing President Nicolas Maduro, electoral authorities said Monday, without setting a date for the next step. The head of the National Electoral Council (CNE), Tibisay Lucena, told a press conference Maduro's opponents had cleared the threshold of 200,000 valid signatures on a petition demanding the leftist leader face a recall referendum. The opposition blames Maduro for an economic implosion that has seen food shortages, hyperinflation, violence and looting erupt in the once-booming oil giant. The council did not set a date for the next stage of the lengthy recall process, in which the opposition must collect four million signatures in just three days. In a boost to the Maduro camp's claims of rampant fraud, Lucena said the authorities had detected more than 1,000 apparently falsified signatures. The opposition submitted 1.8 million signatures in May calling for Maduro to face a recall, 1.3 million of which were accepted by the council. Signatories then had to show up at electoral offices to validate their identity with fingerprint scans. The threshold was one per cent of the electorate, or roughly 200,000 signatures which the opposition cleared. "The certification will be granted by the (CNE) secretariat," Lucena said. That enables the main opposition coalition, the Democratic Unity Roundtable (MUD), to formally request a recall vote. However, Lucena said more than 1,000 fingerprint scans did not correspond with the signatory's identity, more than 400 were repeats and nearly 200 people tried to register more than once. "The electoral authority will ask the state prosecutor's office to investigate the potential usurpation of identity committed by some citizens," she said. A recent poll found 64 per cent of Venezuelans would vote to remove Maduro. But to get there, the opposition first has to collect another four million signatures in three days, at a yet-to-be-decided time. To win the ensuing recall referendum, Maduro's opponents would need more votes than he won the presidency with in 2013 around 7.5 million. Time appears to be on the president's side. His allies have an arsenal of possible delaying strategies. They have filed more than 8,000 legal challenges against the recall petition and called on the electoral authorities to ban MUD for alleged fraud. The opposition is racing to force a referendum by January 10, the cutoff date to trigger new elections four years into the president's six-year term. After that date, a successful recall vote would simply transfer power to Maduro's hand-picked vice-president.US Secretary of State John Kerry urged Venezuela not to stall. "The Venezuelan constitution guarantees Venezuelans the right to have their voices heard through the referendum process. And we call on Venezuela`s authorities to allow this process to go forward in a timely and a fair manner, and not to play a game of delay," he said in Washington. MUD, a motley coalition of opposition parties, accuses the electoral authority of being in bed with Maduro. They are hoping pressure from Venezuelans desperate over the collapsing economy will force the government's hand. But MUD has struggled to rally mass protests. Many Venezuelans are too busy standing in line for scarce food and basic goods. Maduro has declared a state of emergency and given his military sweeping powers over food production and distribution. Venezuela has sunk into crisis as global prices for its main export, oil, have collapsed. Its economy is facing its third year of deep recession this year. Its inflation rate is the highest in the world, forecast to top 700 per cent this year. The economic tailspin is threatening 17 years of socialist rule under Maduro and his late predecessor, Hugo Chavez. The opposition won legislative elections in December, only to find its power stymied by the Supreme Court, which it says is also in Maduro's pocket. (AFP)

Venezuela recall clears hurdle, but no date for next step

Inflation surged to 16.5 per cent in Nigeria last month -- its highest level in more than decade -- as prices of imported food and energy jumped after the government stopped propping up the currency, the National Bureau of Statistics said today. 
 
The rate rose from 15.6 per cent in May, the fifth increase in as many months, the NBS said in an emailed statement. The new rate is the highest since October 2005, according to the central bank. 
 
The highest increases were seen in electricity prices, kerosene, furniture and furnishings, road passenger transport, as well as fuels and lubricants, the statistics agency said. 
 
Food prices rose 15.3 per cent year-on-year in June, compared with 14.9 per cent in May.&nbsp;Yvonne Mhango, an economist at Renaissance Capital, told Bloomberg she expected inflation to rise further in the coming months. 
 
&quot;We see inflation averaging in the mid 20 per cent by year-end, mainly because of the foreign exchange rates,&quot; she was quoted as saying. 
 
Nigerians are struggling with spiralling cost of living after a 67 per cent hike in the price of petrol in April and last month&#39;s scrapping of the peg of the Naira exchange rate at 197/199 to the Dollar.&nbsp;The Naira now trades at around 360 to the Dollar on the black market. The official rate is at about 280 to the Dollar. 
 
Nigeria, one of Africa&#39;s main oil producers, normally gets 70 per cent of its revenue from oil sales.&nbsp;But the global fall in crude prices since mid-2014 has left the government cash-strapped and even unable to pay wages. 
 
Public sector workers in most of the country&#39;s 36 states are on strike because of unpaid salaries, with some owed six months&#39; back pay.&nbsp;The International Monetary Fund has said Nigeria&#39;s economy could contract for the first time in more than two decades this year, as a fall in oil revenue and electricity shortages weigh on output. 
 
(AFP)

Public sector workers in most of the country's 36 states are on strike because of unpaid salaries, with some owed six months' back pay

Inflation surged to 16.5 per cent in Nigeria last month -- its highest level in more than decade -- as prices of imported food and energy jumped after the government stopped propping up the currency, the National Bureau of Statistics said today. The rate rose from 15.6 per cent in May, the fifth increase in as many months, the NBS said in an emailed statement. The new rate is the highest since October 2005, according to the central bank. The highest increases were seen in electricity prices, kerosene, furniture and furnishings, road passenger transport, as well as fuels and lubricants, the statistics agency said. Food prices rose 15.3 per cent year-on-year in June, compared with 14.9 per cent in May. Yvonne Mhango, an economist at Renaissance Capital, told Bloomberg she expected inflation to rise further in the coming months. "We see inflation averaging in the mid 20 per cent by year-end, mainly because of the foreign exchange rates," she was quoted as saying. Nigerians are struggling with spiralling cost of living after a 67 per cent hike in the price of petrol in April and last month's scrapping of the peg of the Naira exchange rate at 197/199 to the Dollar. The Naira now trades at around 360 to the Dollar on the black market. The official rate is at about 280 to the Dollar. Nigeria, one of Africa's main oil producers, normally gets 70 per cent of its revenue from oil sales. But the global fall in crude prices since mid-2014 has left the government cash-strapped and even unable to pay wages. Public sector workers in most of the country's 36 states are on strike because of unpaid salaries, with some owed six months' back pay. The International Monetary Fund has said Nigeria's economy could contract for the first time in more than two decades this year, as a fall in oil revenue and electricity shortages weigh on output. (AFP)

Nigerian inflation rises to 11-year high

India&#39;s headline inflation probably stayed near a two-year high in June even as industrial production in May likely contracted, increasing the odds that the central bank will keep interest rates on hold next month. 
 
Consumer prices in June are estimated to have risen 5.73 per cent on an annual basis, according to a Reuters poll, a tad lower than May&#39;s 5.76 per cent - the fastest pace since August 2014.&nbsp;That would be a worry for outgoing Reserve Bank of India (RBI) Governor Raghuram Rajan, who wants inflation kept below at 5 per cent by March 2017. 
 
The Aug. 9 policy meeting will be the last for Rajan, whose three-year term ends in early September. Between January 2015 and this April, he cut the repo rate by 150 basis points, to 6.50 per cent.&nbsp;After holding rates in June, the governor said the central bank was looking for room to reduce them further, but it remained concerned about pressure on food and commodity prices. 
 
Demand-driven pressures are likely to be stoked by the hike of salaries and pensions for about 10 million government employees and pensioners. Vegetable prices, meanwhile, have surged due to seasonal supply disruptions. 
 
While a pick-up in summer monsoon rains in recent weeks is expected to cool food inflation, most analysts don&#39;t expect another rate cut before a new governor is on the job. DBS in Singapore expects a rate cut in the October-December quarter. 
 
New Governor, New Mechanism 
 
Prime Minister Narendra Modi is widely expected to name a new governor before July 18. Government sources say the race is mainly between former RBI deputy governors Rakesh Mohan and Subir Gokarn. 
 
The government has to also constitute a Monetary Policy Committee (MPC) to set interest rates by a majority vote, a departure from the current regime where the decision effectively rests with the RBI chief.&nbsp;It aims to name the six-member committee before the August policy review. Three members of the MPC would be RBI insiders, headed by the governor who would have the casting vote in the event of a 3-3 split. 
 
Three external members would be chosen by a panel comprising Modi&#39;s cabinet secretary, the RBI governor, a top finance ministry bureaucrat and three outside experts named by the government.&nbsp;India&#39;s statistics office will release retail inflation data and industrial production data at 1200 GMT today. 
 
Analysts surveyed by Reuters expect output at factories, mines and utilities to shrink 0.4 per cent in May from a year earlier compared with a surprise 0.8 per cent annual contraction a month ago. 
 
(Reuters)

According to a Reuters poll, consumer prices in June rose 5.73 per cent on an annual basis, a tad lower than May's 5.76

India's headline inflation probably stayed near a two-year high in June even as industrial production in May likely contracted, increasing the odds that the central bank will keep interest rates on hold next month. Consumer prices in June are estimated to have risen 5.73 per cent on an annual basis, according to a Reuters poll, a tad lower than May's 5.76 per cent - the fastest pace since August 2014. That would be a worry for outgoing Reserve Bank of India (RBI) Governor Raghuram Rajan, who wants inflation kept below at 5 per cent by March 2017. The Aug. 9 policy meeting will be the last for Rajan, whose three-year term ends in early September. Between January 2015 and this April, he cut the repo rate by 150 basis points, to 6.50 per cent. After holding rates in June, the governor said the central bank was looking for room to reduce them further, but it remained concerned about pressure on food and commodity prices. Demand-driven pressures are likely to be stoked by the hike of salaries and pensions for about 10 million government employees and pensioners. Vegetable prices, meanwhile, have surged due to seasonal supply disruptions. While a pick-up in summer monsoon rains in recent weeks is expected to cool food inflation, most analysts don't expect another rate cut before a new governor is on the job. DBS in Singapore expects a rate cut in the October-December quarter. New Governor, New Mechanism Prime Minister Narendra Modi is widely expected to name a new governor before July 18. Government sources say the race is mainly between former RBI deputy governors Rakesh Mohan and Subir Gokarn. The government has to also constitute a Monetary Policy Committee (MPC) to set interest rates by a majority vote, a departure from the current regime where the decision effectively rests with the RBI chief. It aims to name the six-member committee before the August policy review. Three members of the MPC would be RBI insiders, headed by the governor who would have the casting vote in the event of a 3-3 split. Three external members would be chosen by a panel comprising Modi's cabinet secretary, the RBI governor, a top finance ministry bureaucrat and three outside experts named by the government. India's statistics office will release retail inflation data and industrial production data at 1200 GMT today. Analysts surveyed by Reuters expect output at factories, mines and utilities to shrink 0.4 per cent in May from a year earlier compared with a surprise 0.8 per cent annual contraction a month ago. (Reuters)

India's retail inflation expected to remain high in June

China&#39;s consumer price growth slowed in June, the National Bureau of Statistics (NBS) said today, giving the central government room for further monetary stimulus to stabilise economic growth. 
 
The consumer price index (CPI) -- a main gauge of inflation -- rose 1.9 perc ent on-year, the National Bureau of Statistics said, lower than May&#39;s 2.0 per cent but higher than the 1.8 median forecast in a Bloomberg News survey of economists. 
 
Moderate inflation can be a boon to consumption as it pushes buyers to act before prices go up, while falling prices encourage shoppers to delay purchases and companies to put off investment, both of which can hurt growth. 
 
Food prices fell 1.4 per cent month-on-month, the data showed, weighing down the overall inflation figures. 
 
The world&#39;s second largest economy expanded last year at its slowest rate in a quarter of a century as Beijing strives to effect a difficult transition in its growth model away from reliance on exports and fixed-asset investment towards one driven by consumers.&nbsp; 
 
The producer price index (PPI), which measures the cost of goods at the factory gate, fell 2.6 per cent year-on-year last month, narrower than the 2.8 per cent decline in May, as deflation pressures eased due to a rebound in some commodity prices. 
 
Protracted declines in PPI bode ill for industrial prospects, but narrowing declines in the last two months have fuelled hopes the Chinese economy could be reaching the bottom of a painful slowdown. 
 
Looking ahead, analysts said widespread flooding due to summer heavy rains could put short-term pressure on China&#39;s industrial output.&nbsp; 
 
Construction is likely to spike once the floods subside, but in the short term industrial production growth will see &quot;negative shocks&quot;, Zhang Yao of Nomura said in a note.&nbsp; 
 
Food prices could spike due to the destruction of crops and livestock by floods, said Chang Liu of Capital Economics, increasing the risks of an rise in consumer inflation in the second half of the year. 
 
(AFP)

This will allow the central government room for further monetary stimulus to stabilise the economic growth

China's consumer price growth slowed in June, the National Bureau of Statistics (NBS) said today, giving the central government room for further monetary stimulus to stabilise economic growth. The consumer price index (CPI) -- a main gauge of inflation -- rose 1.9 perc ent on-year, the National Bureau of Statistics said, lower than May's 2.0 per cent but higher than the 1.8 median forecast in a Bloomberg News survey of economists. Moderate inflation can be a boon to consumption as it pushes buyers to act before prices go up, while falling prices encourage shoppers to delay purchases and companies to put off investment, both of which can hurt growth. Food prices fell 1.4 per cent month-on-month, the data showed, weighing down the overall inflation figures. The world's second largest economy expanded last year at its slowest rate in a quarter of a century as Beijing strives to effect a difficult transition in its growth model away from reliance on exports and fixed-asset investment towards one driven by consumers. The producer price index (PPI), which measures the cost of goods at the factory gate, fell 2.6 per cent year-on-year last month, narrower than the 2.8 per cent decline in May, as deflation pressures eased due to a rebound in some commodity prices. Protracted declines in PPI bode ill for industrial prospects, but narrowing declines in the last two months have fuelled hopes the Chinese economy could be reaching the bottom of a painful slowdown. Looking ahead, analysts said widespread flooding due to summer heavy rains could put short-term pressure on China's industrial output. Construction is likely to spike once the floods subside, but in the short term industrial production growth will see "negative shocks", Zhang Yao of Nomura said in a note. Food prices could spike due to the destruction of crops and livestock by floods, said Chang Liu of Capital Economics, increasing the risks of an rise in consumer inflation in the second half of the year. (AFP)

China inflation slowed in June

Marco Streng is a miner, though he does not carry a pick around his base in south-west Iceland. Instead, he keeps tens of thousands of computers running 24 hours a day in fierce competition with others across the globe to earn bitcoins. 
 
In the world of the web-based digital currency, it is not central banks that add new money to the system, but rather computers like Streng&#39;s which are awarded fresh bitcoins in return for processing blocks of the latest bitcoin transactions. 
 
Bitcoin can be used to send money instantly around the world, using individual bitcoin addresses, free of charge with no need for third party checks, and is accepted by several major online retailers. 
 
The work Streng&#39;s computers and others do serves two purposes: they record and verify the roughly 225,000 daily bitcoin transactions and, because they earn new bitcoins for the work they do, steadily increase the currency in circulation, worth around $10 billion at present. 
 
The process has come to be known as &#39;mining&#39; because it is slow and intensive, reaping a gradual reward in the same way that minerals such as gold are mined from the ground. 
 
But on Saturday, the reward for miners will be slashed in half. Written into bitcoin&#39;s code when it was invented in 2008 was a rule dictating that the prize would be halved every four years, in a step designed to keep a lid on bitcoin inflation. 
 
From around 1700 GMT on Saturday, instead of 25 bitcoins up for grabs globally every 10 minutes, worth around $16,000 at the current rate, only 12.5 will be available. 
 
That means only the mining companies with the leanest operations will survive the ensuing profit hit. 
 
&quot;The most important thing is to be the most efficient miner,&quot; said Streng, the 26-year-old co-founder of German firm Genesis Mining, which has &quot;mining farms&quot; in Canada, the United States and eastern Europe, as well as in Iceland. &quot;When the others drop out, that means that they leave the market and give you a bigger share of the pie.&quot; 
 
Solving puzzles 
 
The currency was founded eight years ago by a person or group using the name Satoshi Nakamoto, whose real identity has not been established. It was set up to operate independently of any single authority, instead relying on a decentralised global network. 
 
Because the bitcoin miners operate autonomously, it is hard to track their numbers and size. But in terms of computing capacity, it was estimated earlier this year that the network is 43,000 times more powerful than the world&#39;s top 500 supercomputers combined. 
 
Computers like Streng&#39;s solve complex, automatically generated mathematical puzzles to help secure each block of transactions and keep the bitcoin network safe from hacking or manipulation. For bitcoin users, that security is one of the currency&#39;s main attractions. 
 
After the first miner secures a block of transactions, its work is verified by the other miners in the network, and that block is added to the &quot;blockchain&quot; - a shared record of all the transaction data - which is virtually impossible to tamper with. The mining, therefore, keeps the whole system going. 
 
Bitcoin is now accepted by major organisations including US online retailer Overstock.com and travel company Expedia. 
 
The speed and anonymity of bitcoin transactions, and lack of a central authority overseeing the currency, has drawn in many users, including those who want to get around capital controls. It has also attracted investors who see it as a potentially lucrative commodity in itself. 
 
Keeping cool 
 
Bitcoin mining started out as a hobby for tech geeks using their home computers in the early years of the virtual currency, but has become more specialised as bitcoin usage expands. 
 
As the bitcoin price has risen, as transaction numbers have grown and as the computers have become so specialised that they can only perform the function of bitcoin mining, a whole industry has emerged. 
 
It can be profitable if firms are able to keep their expenses low. But the costs of running these machines, which cost around $1,800 each, and keeping them cool are fiendishly high. 
 
Streng reckons that, on average, it costs about $200 in electricity, including cooling power, to mine one bitcoin. Equipment, rent, wages and business running costs are on top. 
 
On Saturday, all else being equal, the halving of the reward will double that cost, to $400, leaving a small margin for profit at the current exchange rate of around $640 per bitcoin. 
 
In the same remote region of Iceland as the Genesis mining farm, on a former Cold War US military base lies a bitcoin mining facility belonging to US firm Bitfury. A nearby sub-station means electricity transmission costs are minimal. 
 
In the farm&#39;s two vast buildings, tens of thousands of mining machines whir away, producing a huge amount of heat, so the buildings are open to the cold Icelandic air at either side, save for particle filters to trap dust. 
 
Fans in the ceiling allow hot air to escape, but spin so fast that no rain or snow can enter during the winter. The noise produced by computers and fans is deafening. 
 
It is no coincidence that so many mining companies have chosen to build farms in Iceland - Chinese giant Bitmain also has a huge farm there. The volcanic island&#39;s cheap, bountiful, renewable energy supply, good internet connectivity, and cool temperatures make it an ideal location. 
 
The Icelandic authorities welcome the boost to the economy that the bitcoin miners have brought. Bitmain opened its farm after an approach by the Icelandic embassy in Beijing. Genesis&#39;s Streng says he is such a valued client that the Icelandic energy companies fly him around in helicopters. 
 
Bitfury CEO Valery Vavilov, who estimates electricity makes up between 90 and 95 per cent of bitcoin mining costs, says one way his firm stays competitive is by making its own hardware. 
 
He also says the company, founded in 2011, is prepared for the mining reward cut. &quot;We&#39;re prepared - we already went through one halving event in 2012,&quot; he said. &quot;You can forecast this... so you have time to prepare, and if you&#39;re prepared you can live quite easily&quot;. 
 
Vavilov, and other miners, say the prospect of new supply halving has already helped drive bitcoin up over 50 per cent this year, which should help ease the pain. 
 
Competition from China 
 
Despite the fact that the halving was expected, and that the price has risen, it has already claimed one casualty: Sweden&#39;s KnCMiner filed for bankruptcy at the end of May, citing the hit to its profits that the reward cut would bring. 
 
Daniel Masters, who runs a Jersey-based bitcoin hedge fund and who bought a part of KnC&#39;s business, said the Swedish firm, like everybody else, had faced competition from miners in China, which are estimated to make up more than two-thirds of the bitcoin network&#39;s computing power, or &quot;hashpower&quot;. 
 
&quot;It turned out that the Chinese, who really stormed into the mining market in the last couple of years, could just do this whole thing cheaper,&quot; Masters said. 
 
Some Chinese miners get hydroelectric power from disused dams, while others use cheap coal-powered electricity. 
 
Bitfury and Genesis, though, say their lean operations allow them to fight off the competition. Genesis, for example, keeps cost down by remotely monitoring conditions in its mining farms and adjusting its fans and cooling accordingly. 
 
And the next time the mining reward is halved, in 2020, they hope the number of bitcoin transactions will have grown sufficiently to mean that the small fees paid by users will make up enough of their income to smooth out the profit cut. 
 
&quot;By 2020, we will definitely have had the tipping point,&quot; said Bitfury&#39;s Vavilov. 
 
(Reuters)&nbsp;

Written into the online currency's code is a rule that the reward for miners gets cut in half every four years to limit inflation

Marco Streng is a miner, though he does not carry a pick around his base in south-west Iceland. Instead, he keeps tens of thousands of computers running 24 hours a day in fierce competition with others across the globe to earn bitcoins. In the world of the web-based digital currency, it is not central banks that add new money to the system, but rather computers like Streng's which are awarded fresh bitcoins in return for processing blocks of the latest bitcoin transactions. Bitcoin can be used to send money instantly around the world, using individual bitcoin addresses, free of charge with no need for third party checks, and is accepted by several major online retailers. The work Streng's computers and others do serves two purposes: they record and verify the roughly 225,000 daily bitcoin transactions and, because they earn new bitcoins for the work they do, steadily increase the currency in circulation, worth around $10 billion at present. The process has come to be known as 'mining' because it is slow and intensive, reaping a gradual reward in the same way that minerals such as gold are mined from the ground. But on Saturday, the reward for miners will be slashed in half. Written into bitcoin's code when it was invented in 2008 was a rule dictating that the prize would be halved every four years, in a step designed to keep a lid on bitcoin inflation. From around 1700 GMT on Saturday, instead of 25 bitcoins up for grabs globally every 10 minutes, worth around $16,000 at the current rate, only 12.5 will be available. That means only the mining companies with the leanest operations will survive the ensuing profit hit. "The most important thing is to be the most efficient miner," said Streng, the 26-year-old co-founder of German firm Genesis Mining, which has "mining farms" in Canada, the United States and eastern Europe, as well as in Iceland. "When the others drop out, that means that they leave the market and give you a bigger share of the pie." Solving puzzles The currency was founded eight years ago by a person or group using the name Satoshi Nakamoto, whose real identity has not been established. It was set up to operate independently of any single authority, instead relying on a decentralised global network. Because the bitcoin miners operate autonomously, it is hard to track their numbers and size. But in terms of computing capacity, it was estimated earlier this year that the network is 43,000 times more powerful than the world's top 500 supercomputers combined. Computers like Streng's solve complex, automatically generated mathematical puzzles to help secure each block of transactions and keep the bitcoin network safe from hacking or manipulation. For bitcoin users, that security is one of the currency's main attractions. After the first miner secures a block of transactions, its work is verified by the other miners in the network, and that block is added to the "blockchain" - a shared record of all the transaction data - which is virtually impossible to tamper with. The mining, therefore, keeps the whole system going. Bitcoin is now accepted by major organisations including US online retailer Overstock.com and travel company Expedia. The speed and anonymity of bitcoin transactions, and lack of a central authority overseeing the currency, has drawn in many users, including those who want to get around capital controls. It has also attracted investors who see it as a potentially lucrative commodity in itself. Keeping cool Bitcoin mining started out as a hobby for tech geeks using their home computers in the early years of the virtual currency, but has become more specialised as bitcoin usage expands. As the bitcoin price has risen, as transaction numbers have grown and as the computers have become so specialised that they can only perform the function of bitcoin mining, a whole industry has emerged. It can be profitable if firms are able to keep their expenses low. But the costs of running these machines, which cost around $1,800 each, and keeping them cool are fiendishly high. Streng reckons that, on average, it costs about $200 in electricity, including cooling power, to mine one bitcoin. Equipment, rent, wages and business running costs are on top. On Saturday, all else being equal, the halving of the reward will double that cost, to $400, leaving a small margin for profit at the current exchange rate of around $640 per bitcoin. In the same remote region of Iceland as the Genesis mining farm, on a former Cold War US military base lies a bitcoin mining facility belonging to US firm Bitfury. A nearby sub-station means electricity transmission costs are minimal. In the farm's two vast buildings, tens of thousands of mining machines whir away, producing a huge amount of heat, so the buildings are open to the cold Icelandic air at either side, save for particle filters to trap dust. Fans in the ceiling allow hot air to escape, but spin so fast that no rain or snow can enter during the winter. The noise produced by computers and fans is deafening. It is no coincidence that so many mining companies have chosen to build farms in Iceland - Chinese giant Bitmain also has a huge farm there. The volcanic island's cheap, bountiful, renewable energy supply, good internet connectivity, and cool temperatures make it an ideal location. The Icelandic authorities welcome the boost to the economy that the bitcoin miners have brought. Bitmain opened its farm after an approach by the Icelandic embassy in Beijing. Genesis's Streng says he is such a valued client that the Icelandic energy companies fly him around in helicopters. Bitfury CEO Valery Vavilov, who estimates electricity makes up between 90 and 95 per cent of bitcoin mining costs, says one way his firm stays competitive is by making its own hardware. He also says the company, founded in 2011, is prepared for the mining reward cut. "We're prepared - we already went through one halving event in 2012," he said. "You can forecast this... so you have time to prepare, and if you're prepared you can live quite easily". Vavilov, and other miners, say the prospect of new supply halving has already helped drive bitcoin up over 50 per cent this year, which should help ease the pain. Competition from China Despite the fact that the halving was expected, and that the price has risen, it has already claimed one casualty: Sweden's KnCMiner filed for bankruptcy at the end of May, citing the hit to its profits that the reward cut would bring. Daniel Masters, who runs a Jersey-based bitcoin hedge fund and who bought a part of KnC's business, said the Swedish firm, like everybody else, had faced competition from miners in China, which are estimated to make up more than two-thirds of the bitcoin network's computing power, or "hashpower". "It turned out that the Chinese, who really stormed into the mining market in the last couple of years, could just do this whole thing cheaper," Masters said. Some Chinese miners get hydroelectric power from disused dams, while others use cheap coal-powered electricity. Bitfury and Genesis, though, say their lean operations allow them to fight off the competition. Genesis, for example, keeps cost down by remotely monitoring conditions in its mining farms and adjusting its fans and cooling accordingly. And the next time the mining reward is halved, in 2020, they hope the number of bitcoin transactions will have grown sufficiently to mean that the small fees paid by users will make up enough of their income to smooth out the profit cut. "By 2020, we will definitely have had the tipping point," said Bitfury's Vavilov. (Reuters)

Bitcoin 'miners' face fight for survival

Reserve Bank of India (RBI), central bank of India, Governor Raghuram Rajan, who has faced criticism from members of the ruling party for keeping interest rates too high, stunned officials on Saturday by announcing he would step down when his term ends on September 4. 
 
Rajan, a former chief economist at the IMF, has been popular with foreign investors for his efforts to tackle inflation, and won praise for helping rescue India from its worst currency crisis in more than two decades after taking the helm in September 2013. 
 
But in a nearly 900-world letter to staff he said he planned to return to academia, even as he noted two of his actions - the creation of a monetary policy committee to set interest rates and the clean-up of the banking sector - remained unfinished. 
 
&quot;While I was open to seeing these developments through, on due reflection, and after consultation with the government, I want to share with you that I will be returning to academia when my term as Governor ends on Sept. 4, 2016,&quot; Rajan said in the letter released by the RBI. 
 
&quot;I will, of course, always be available to serve my country when needed.&quot; 
 
Rajan, who is on leave from the University of Chicago, was appointed RBI Governor by the previous Congress government, where he had served as chief economic advisor to the finance minister for about a year before taking the helm of the central bank. 
 
&quot;The Government appreciates the good work done by him and respects his decision. A decision on his successor would be announced shortly,&quot; Finance Minister Arun Jaitley said in a tweet on Saturday. 
 
Although feted by investors, Rajan had faced strident criticism from right-wing members of Prime Minister Narendra Modi&#39;s Bharatiya Janata Party, including parliament member Subramanian Swamy, who has waged a public campaign against his economic policies. 
 
Rajan had also veered into topics - such as intolerance in society - that have angered some BJP members, as did recent comments that were seen by some government officials as playing down their economic accomplishments. 
 
&quot;GOOD TEACHER&quot; 
 
Still, Rajan was known to have a good working relationship with Modi, with the Prime Minister calling the RBI governor a &quot;good teacher&quot; on economic matters, and government officials had previously told Reuters that Modi&#39;s administration would re-appoint the governor, should he wish to stay on. 
 
Many of Rajan&#39;s key accomplishments have come in close collaboration with the Modi government. 
 
Rajan pushed for inflation targeting to tackle India&#39;s history of volatile prices, which was then unveiled by the government last year. 
 
He has also worked with the government on the creation of a monetary policy committee as well as the clean-up of heavily indebted banks - both of which may now have to be tackled by his successor. 
 
Current RBI Deputy Governor Urjit Patel, State Bank of India chairman Arundhati Bhattacharya, the finance ministry&#39;s Chief Economic Adviser Arvind Subramanian and the government&#39;s Economic Affairs Secretary Shaktikanta Das have previously been named by analysts as potential replacements should Rajan depart. 
 
Analysts said markets would likely react negatively on Monday, at a time when global factors such as Britain&#39;s referendum on European Union membership are already weighing. Though many analysts had speculated Rajan could decide not to pursue a second term, few had foreseen it would come in the form of a letter to staff. 
 
Senior government and RBI officials contacted by Reuters said they had been taken by surprise at the announcement. 
 
&quot;This will be seen as a disappointment by the market particularly the international investors&#39; community,&quot; said Ananth Narayan, regional head of financial markets for ASEAN and South Asia at Standard Chartered Bank. 
 
&quot;And we can only hope the government quickly announces a strong replacement to fill his big shoes.&quot; 
(Reuters)

Investors loved him, Modi had a strong like but more right-wing members of India's ruling party were strident critics

Reserve Bank of India (RBI), central bank of India, Governor Raghuram Rajan, who has faced criticism from members of the ruling party for keeping interest rates too high, stunned officials on Saturday by announcing he would step down when his term ends on September 4. Rajan, a former chief economist at the IMF, has been popular with foreign investors for his efforts to tackle inflation, and won praise for helping rescue India from its worst currency crisis in more than two decades after taking the helm in September 2013. But in a nearly 900-world letter to staff he said he planned to return to academia, even as he noted two of his actions - the creation of a monetary policy committee to set interest rates and the clean-up of the banking sector - remained unfinished. "While I was open to seeing these developments through, on due reflection, and after consultation with the government, I want to share with you that I will be returning to academia when my term as Governor ends on Sept. 4, 2016," Rajan said in the letter released by the RBI. "I will, of course, always be available to serve my country when needed." Rajan, who is on leave from the University of Chicago, was appointed RBI Governor by the previous Congress government, where he had served as chief economic advisor to the finance minister for about a year before taking the helm of the central bank. "The Government appreciates the good work done by him and respects his decision. A decision on his successor would be announced shortly," Finance Minister Arun Jaitley said in a tweet on Saturday. Although feted by investors, Rajan had faced strident criticism from right-wing members of Prime Minister Narendra Modi's Bharatiya Janata Party, including parliament member Subramanian Swamy, who has waged a public campaign against his economic policies. Rajan had also veered into topics - such as intolerance in society - that have angered some BJP members, as did recent comments that were seen by some government officials as playing down their economic accomplishments. "GOOD TEACHER" Still, Rajan was known to have a good working relationship with Modi, with the Prime Minister calling the RBI governor a "good teacher" on economic matters, and government officials had previously told Reuters that Modi's administration would re-appoint the governor, should he wish to stay on. Many of Rajan's key accomplishments have come in close collaboration with the Modi government. Rajan pushed for inflation targeting to tackle India's history of volatile prices, which was then unveiled by the government last year. He has also worked with the government on the creation of a monetary policy committee as well as the clean-up of heavily indebted banks - both of which may now have to be tackled by his successor. Current RBI Deputy Governor Urjit Patel, State Bank of India chairman Arundhati Bhattacharya, the finance ministry's Chief Economic Adviser Arvind Subramanian and the government's Economic Affairs Secretary Shaktikanta Das have previously been named by analysts as potential replacements should Rajan depart. Analysts said markets would likely react negatively on Monday, at a time when global factors such as Britain's referendum on European Union membership are already weighing. Though many analysts had speculated Rajan could decide not to pursue a second term, few had foreseen it would come in the form of a letter to staff. Senior government and RBI officials contacted by Reuters said they had been taken by surprise at the announcement. "This will be seen as a disappointment by the market particularly the international investors' community," said Ananth Narayan, regional head of financial markets for ASEAN and South Asia at Standard Chartered Bank. "And we can only hope the government quickly announces a strong replacement to fill his big shoes." (Reuters)

Reserve Bank of India chief Raghuram Rajan to step down

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