Blockchain update

[lakedaemonian]

Re: Blockchain update

This is far from clear to me. In fact, that goes for many segments in the wider economy too. I simply cannot believe that $3,000 per month is a fair market rate for a 600sqft, 1-bed, roach-infested apartment in a 200 year old building neighborhood you'd be liable to be shot in 10 years ago with a median family income of $12,000 in any world where the real estate market is not all about speculative greed, for example. Yet here we are.

Is the root cause of the specific example of real estate speculation due to flipper greed, or due to irrational monetary policy that intentionally hurts rational savers?

Is real estate speculation the root cause or is it the effect?

Isn’t the rise of crypto in part due to the lack of trust?

What do you do with 1 billion Bolivars to retain your purchasing power?

What do you do with 1 million US Dollars to retain your purchasing power?

[lakedaemonian]

Re: Blockchain update

They usually drastically lag trends unless moves are rather sharp. Many new fields are not real, do not exist, or are sort of viewed as sell-a-dream scams & then by the time the mainstream media covers them with something other than disdain most of the profit has already been made. This was sort of how many webmaster related trends have been covered over the years, from domaining to SEO to affiliate marketing.



The other issue is if there is toxic fallout from ponzicoins then legitcoin might face significant regulatory headwinds.

Of course legit entities will face headwinds.

My previous employer Amazon faced existential headwinds immediately following the dot com bubble pop and 9/11. They and others survived and thrived. I think the same will happen with crypto. Which ones? Too soon to tell. But I do like Ethereum & NEO(as previously posted) and I’m intrigued with MakerDAO and OpenBazaar. They seem closest to creating/capturing actual value.


I think if the winning currencies come from this thesis they will be tied into companies that already operate other services people love.

Quite possibly, and I think it will be largely due to their infrastructure/expertise/efficiency with cross border shipping. Amazon and Alibaba specifically.

The regulatory headwinds I was referring to in the prior part ... think about how MegaUpload was shut down & the owner's assets were seized. Then consider YouTube, which has far more piracy on it, but YouTube is fine (in spite of terrorism recruiters, hate preachers, pedos on it, exploitative autogenerated videos targeted at kids, etc etc etc) because it is tied in with a broader & stronger company which is highly profitable, influential & has a history of strong political connections.

It was called “Non market strategy” when I was at Stanford, my Google classmates talked openly about the desert strategy(bigger than Buffett’s moat). They openly referred to Microsoft’s missteps with lobbying. Google, Amazon, etc are not making the same mistake.

The big big players will also be aware of Ebay’s early online payment problem and PayPal’s rise. They will want to create and capture that crypto Paypal value themselves.


It sure feels like it. I see the ads frequently across the web. There are even ads for "launch your own cryptocoin"

I actually think we NK we will see the rise of tons of useable coins.

A few massive ones. And a lot of affinity coins. Think loyalty systems/schemes.



Last time I saw such an over-concentration of ads in a sector that expanded across the broader web it was the coupon related stuff with Groupon, LivingSocial & others. I think to this day Groupon is valued at less than the amount they raised & I believe they bought LivingSocial for "no consideration" in spite of LivingSocial raising about $1 billion.

The only people who won in that group coupon craze were the early Groupon insiders who cashed out and the people who had Google shares monetizing the misallocated VC funds spent on online ads.

The hard part about the cryptocoin ad stuff is perhaps some of the ads seem more overrepresented than they actually are due to more advanced ad retargeting options. An advertiser could target ads at anyone who had visited Coinmarketcap.com even as they browse other websites. There has also been at least one cryptocoin that has bought a Time Square billboard.

But it goes back to my point of making things people want/need/love.

If you are, you don’t need to advertise(at least not excessively), your installed customer base helps expand your customer base for you on your behalf.

Times Square billboards isn’t just a repeat of Groupon silliness, but dot com silliness and excess as well. A Times Square billboard for Boo.com, Groupon, or DodgyCoin doesn’t offer a compelling value proposition.

Won't most of these largely be private for-profit bolt-on services tied to other widely used services from companies akin to Facebook/Google/Amazon?

• Kenya has M-Pesa
• China has Alipay and WeChat. These companies are even pushing to become official government IDs. And even with that tie in test as a government ID service beginning, Chinese consumers are still widely using them, because they have used them extensively and trust the companies. At the same time, the very same people opt out of using China's rewards points snitch-a-neighbor apps.
• Hong Kong's transit Octopus Card is also used in many vending machines, convenience stores, etc.
• India has Paytm & Oxigen
• etc.

All of which are centrally processed and capable of being attacked/shaped/influenced.

None of them are decentralised or distributed.



I could see Apple, Google, Facebook or Amazon pushing hard into creating some sort of virtual currency which is tied to a first-world currency in value. Any of the companies which have a strong first-party connection to consumers will be able to offer lower transaction costs because they will be able to better cross monetize the data for media sales & ad targeting.

Of course. Why else is Apple pushing Apple Pay so hard?

Incumbants have massive installed user bases.

So they already have a competitive advantage from their own Metcalfe’s Law success.

Poor folks around the world largely all have smart phones.

I’m expecting to see a merge of those developing world smart phones with 2006 Nobel Peace Prize winner Mohammed Yunus/Grameen Bank’s concept of microlending/finance but for stable cryptocurrency.

As I’ve posted before, I think we’ll see the leaner/meaner/cheaper stable crypto iteration adoption in the developing world.

I’d rather have the solution for the billions at the bottom than the solution for the billion at the top.

Uktimately, I think the main advantages of the current tech leaders are their installed user bases and their cross border logistics.





In the US major banks recently launched Zelle to compete against Paypal, Venmo, etc. ... I think they'll struggle to create something which gets wide usage because it is a collaborative effort between firms largely against innovation rather than a bottoms up service like Stripe which launched a few years back or like Paypal was when it began.

A small, agile, iterative Stripe will win everytime against a ruled by big risk averse committee product like Zelle.

Everytime.

[jk]

Re: Blockchain update

Is the root cause of the specific example of real estate speculation due to flipper greed, or due to irrational monetary policy that intentionally hurts rational savers?

Is real estate speculation the root cause or is it the effect?

Isn’t the rise of crypto in part due to the lack of trust?

What do you do with 1 billion Bolivars to retain your purchasing power?

What do you do with 1 million US Dollars to retain your purchasing power?

with 1 billion bolivars that you can't get into another currency because of capital controls, you buy stock, real assets in limited supply.







i recommend the latest series of interviews at macrovoices- free with registration- especially part 4 focused on the work of luke gromen.

kind of looks a lot like bitcoins path, except crypto as a class is not a limited asset, and so collapsed. gold's chart would like this except for the paper markets. note that bitcoin collapsed exactly when futures trading started.

[touchring]

Re: Blockchain update

Doesn't the blockchain guarantee everything can eventually be traced? If not, then doesn't the blockchain (and all of the cryptocoins) serve little purpose?

So long as the coins are primarily speculative instruments & not something that can be broadly spent into the economy, isn't there a bottleneck at some point?

I’m not familiar with the technical aspect of bitcoin. But isn’t the ransom for ransomwares like wannacry paid in bitcoins? It’s no coincidence that bitcoin became very popular after that. The ability to extort and launder money without trace is simply too attractive to Russian and North Korean cybercriminal groups.

The traditional Mafia is now starting to recognise the beauty of cryptos. We can expect more kidnappings to happen. If I were the Winklevoss twin, i will hire more armed bodyguards or go into hiding.

[seobook]

Re: Blockchain update

I’m not familiar with the technical aspect of bitcoin. But isn’t the ransom for ransomwares like wannacry paid in bitcoins? It’s no coincidence that bitcoin became very popular after that. The ability to extort and launder money without trace is simply too attractive to Russian and North Korean cybercriminal groups.

The traditional Mafia is now starting to recognise the beauty of cryptos. We can expect more kidnappings to happen. If I were the Winklevoss twin, i will hire more armed bodyguards or go into hiding.

So the difference there is mafia within a clean(ish) country the mafia wouldn't want to leave a trail, whereas if you are a state dominated largely by crime right from the top & cyberhacking is one of your core economic exports then leaving a trail doesn't really matter so much. Unless foreign parties are willing to go into your country to do renditions, won't matter.

Even with as politically influential as the big banks are in the US, they still created MERS to disappear much of the paperwork associated with their frauds in the housing market.

The whole point of blockchain is that the chain of transactions is permanently archived, which is the exact opposite of what most lower level criminal rings would want.

I guess if the criminal organization is multinational and can run their transactions through North Korea & the like then maybe that will work for them, but if they are based in the country where they commit the crime the trail of criminal activity never goes away.

kind of looks a lot like bitcoins path, except crypto as a class is not a limited asset, and so collapsed. gold's chart would like this except for the paper markets. note that bitcoin collapsed exactly when futures trading started.

I don't think it was futures contracts that whacked bitcoin. Rather it was likely an insider at Coinbase (or a friend of one) front running adding Bitcoin Cash to their platform. That pump-n-dump stuff revealed

how influential the exchanges are (front-running the move & to some degree helping to set price or create demand through selection of listed options - much like GoDaddy's roll with top level domain names)
the lack of liquidity in the market (the huge price spikes along with the Coinbase freezing sales multiple times)
that brand is the only real scarcity-based limitation on crypto & as exchanges add support for other coins they'll collapse the price of other coins as people shift some of their capital to new Coke.

And then South Korea has also tried to puncture the bubble by announcing meetings & regulations coming out of the meetings.

A small, agile, iterative Stripe will win everytime against a ruled by big risk averse committee product like Zelle.

Everytime.

Absolutely. About the only area where this might fail would be where one player is reliant on another for distribution.

Facebook not only tightly tracks their own ecosystem, but owns a VPN to track growth of competing networks around the world.

Google hard-codes some of their services at the top of the search results. They also leverage Android to make their services default on mobile devices. Starting in February Google's Chrome will start blocking many ads on third party websites. It would be quite hard to create a viable competitor to YouTube today unless it were bolted onto something else, or if someone could pay the music labels enough to exclusively host their videos while getting them removed from YouTube.

[seobook]

Re: Blockchain update

The Criminal Underworld Is Dropping Bitcoin for Another Currency

In monero’s case, criminals are snapping it up because bitcoin’s underlying technology can work against them. Called blockchain, the digital ledger meticulously records which addresses send and receive transactions, including the exact time and amount
... Started in 2014, monero is very different. It encrypts the recipient’s address on its blockchain and generates fake addresses to obscure the real sender. It also obscures the amount of the transaction.

That bodes well for Bitcoin. So does this:
Peter Thiel’s Founders Fund Makes Monster Bet on Bitcoin

The bitcoin bet is quickly showing promise. Founders bought around $15 million to $20 million in bitcoin, and it has told investors the firm’s haul is now worth hundreds of millions of dollars after the digital currency’s ripping rise in the past year.

[patrikkorda]

Re: Blockchain update

So the fact that bitcoin is losing market share at a rapid rate bodes well for bitcoin? It had ~90% market share at the beginning of the year, currently below 40%. I think you are looking at this from a moral perspective versus an investment perspective.

The first big debate was about scalability, hence my bet on Ripple in 2013 and the ~400x return this year. The next big debate will be about fungibility. Money will flow into the fungibility coins, not the other way around...

p.s. Monero is an inferior privacy coin. Like bitcoin, it is a dinosaur on the verge of extinction technologically speaking.

[seobook]

Re: Blockchain update

I think you are looking at this from a moral perspective versus an investment perspective.

I am thinking of it more from the perspective of how the conversation goes down as governments move in on curtailing the field.

With Silk Road & some other stories like that Bitcoin was intertwined with the theme of "crime" but perhaps if the crime moves onto other chains it will lose that association.

Monero is an inferior privacy coin.

I was noting more that the criminal element was moving onto other areas would at least give the Bitcoin folks an angle to fight back against potential binary government regulations...to shape public opinion rather than all blockchains sink at once.

the fact that bitcoin is losing market share at a rapid rate bodes well for bitcoin?

I do see that trend
https://coinmarketcap.com/charts/#dominance-percentage
but will the big, institutional money dive into the 8th or 12th ranked coin?

I get that there will be a Coke and a Pepsi and maybe a Dr. Pepper, but many are just momentum plays. And when some of the fast buck garbage sinks, it may pull down some of the B players as well.

If this guy decides to sell
http://markets.businessinsider.com/n...8-1-1012408621
what happens to the price of Ripple?

At Tuesday’s exchange rate, that gives his holdings a value of $12.82 billion. Forbes also reports that Larsen owns a 17% stake in the company, citing sources inside the firm, bringing his total net worth to $37.3 billion. That would make him the 21st richest person in the world, according to Bloomberg’s Billionaire Index — just behind Indian business magnate Mukesh Ambani.

In a bubbly bull market everything goes up. I obviously do not know the space as well as you do & own 0 coins, but if I had $30 billions in savings over the course of a couple years I would certainly cash in a non-trivial portion of it to mitigate the downside risk of any binary shifts.

thought this one was funny
https://medium.com/@twobitidiot/95-c...8-ca7b74f8abcf
"BTC = reserve currency for people that hate the fed; ETH = reserve currency for people that hate the SEC; XMR = reserve currency for people that hate big brother; Dogecoin = reserve currency for people who don’t care about money."

The next big debate will be about fungibility.

I find your posts interesting & look forward to reading them.

[patrikkorda]

Re: Blockchain update

but will the big, institutional money dive into the 8th or 12th ranked coin?

The short answer is no. Ripple was designed for institutional money, but most profits from the scalability narrative have already been made. The chances of ripple going up another 400X are zero. The fungibility debate will not attract institutional money but rather individuals.

but if I had $30 billions in savings over the course of a couple years I would certainly cash in a non-trivial portion of it to mitigate the downside risk of any binary shifts.

There have always been a plethora of reasons not to invest into Ripple - which made it that much more undervalued since these reasons were propagated heavily by bitcoiners who feared the competition. The two most common reasons were (1) that it was "pre-mined" (i.e., didn't rely on electricity wasting "mining" in a world where 1.3 billion people do not have access to any electricity and (2) that it was centralized (i.e., the team could be nimble and change the source code to make it faster and more frictionless as time went on.).

My view was very simple: If this space continued to grow (a big if but I believed it would) then the big winners would be those that can scale the most. Although Ripple was unanimously hated in 2013 (since most of the scene was libertarian), I understood that the average person is not a libertarian - far from it. The mainstream could careless about the cypherpunk movement, but the mainstream does care about cost reduction.

Bitcoin was a thesis, Ripple was the antithesis, and I believe there will also be a synthesis. The space will continue to pop, evolve, and bubble.

[vt]

Re: Blockchain update

The flawed monetary theory of Craig Wright

http://manonthemargin.com/the-flawed...-craig-wright/

[lakedaemonian]

Re: Blockchain update

The flawed monetary theory of Craig Wright

http://manonthemargin.com/the-flawed...-craig-wright/

As I posted on the previous page, the velocity of a token/coin is critical to its long term success and that speculative run ups are likely to dramatically hinder that.

Hoarding kills velocity/utility/ubiquity

I push back on limitation of ultimate supply.

Dollars can only split down to pennies, but tokens/coins can split much smaller and still retain velocity/utility/ubiquity.

I reckon a stable token/coin(collateral basket backed) that includes token/coin holder consensus central bank voting is intriguing.


Craig Wright sounds like an early adopter of Bitcoin, but also an opportunistic attention seeker.

I think one way for Craig Wright to confirm that he is indeed Satoshi would be for him to move just 1 bitcoin from Satoshi Nakamoto known addresses from A to B.

[patrikkorda]

Re: Blockchain update

I think one way for Craig Wright to confirm that he is indeed Satoshi would be for him to move just 1 bitcoin from Satoshi Nakamoto known addresses from A to B.

There is no question that Craig Wright was one of the earliest contributors to bitcoin along with the likes of Gavin Andresen and Jeff Garzik. With that being said, it is extremely unlikely that the alias Satoshi Nakamoto is just one person. It would be pretty strange for one person to take care of everything from writing code to making logo designs.

As for bitcoin being originally designed as a worldwide monetary system - that is nonsense. It doesn't take an economist to know that money supply must grow continuously along with economic growth in order to prevent price deflation, which leads to declining money velocity, which leads to shrinking GDP. Bitcoin was never used as a medium of exchange and it never will be. The original purpose of bitcoin was a more humble one: to circumvent online gambling restrictions. Take it from Craig Wright.

I believe bitcoin (and "blockchain" in general) took on a life of its own once the silver bubble popped in 2011. The likes of Max Keiser needed to pump something else - and bitcoin fit the bill.

[lakedaemonian]

Re: Blockchain update

There is no question that Craig Wright was one of the earliest contributors to bitcoin along with the likes of Gavin Andresen and Jeff Garzik. With that being said, it is extremely unlikely that the alias Satoshi Nakamoto is just one person. It would be pretty strange for one person to take care of everything from writing code to making logo designs.

As for bitcoin being originally designed as a worldwide monetary system - that is nonsense. It doesn't take an economist to know that money supply must grow continuously along with economic growth in order to prevent price deflation, which leads to declining money velocity, which leads to shrinking GDP. Bitcoin was never used as a medium of exchange and it never will be. The original purpose of bitcoin was a more humble one: to circumvent online gambling restrictions. Take it from Craig Wright.

I believe bitcoin (and "blockchain" in general) took on a life of its own once the silver bubble popped in 2011. The likes of Max Keiser needed to pump something else - and bitcoin fit the bill.

I’ve always viewed bitcoin as an insanely successful experiment.

Nothing more, nothing less.

Here’s a question:

If your total coin/token number is limited, but your fractional slicing of the same coin/token is unlimited(relatively speaking, and I know this changes from coin to coin).....is your money supply actually limited?

The madness around Ripple recently is insane as well.

My two long-disclosed favourites of NEO and Ethereum are both tracking a more gentlemanly mere 600% increase in the last few months.

For me, I’m waiting to see how OpenBazaar develops. I’m hopeful, but cognisant of it being targeted by authorities and vested interests as the next illicit marketplace.

I will also dump all my crypto into an emerging stable coin collateral pool to put my money where my mouth is in hopes I get a small vote in future consensus monetary policy.

[patrikkorda]

Re: Blockchain update

If your total coin/token number is limited, but your fractional slicing of the same coin/token is unlimited(relatively speaking, and I know this changes from coin to coin).....is your money supply actually limited?

Yes, the money supply is still limited.

Ripple: I recall a few years ago telling a friend that I believed it would go to $1.00, this was when it was less than $0.004. I was hesitant to tell him this because I thought it would make me sound a bit crazy.

Stable: I believe stable coins are a great idea and I hope they can somehow circumvent Gresham's law. However, I do not see them as a great investment.

My two long-disclosed favourites of NEO and Ethereum are both tracking a more gentlemanly mere 600% increase in the last few months.

None of the top coins will go up another 800X; most of them won't even go up another 10X. It is mathematically impossible since they are already quite large. I believe there is still another 200X+ play out there, but it will require patience and discipline. Namely, waiting for another crash and buying the right position at the right time.

[*T*]

Re: Blockchain update

For me it's still BTC almost entirely; it has a better Sharpe ratio than alts, and more liquidity.
I attach one analyst's view on the long-term investment picture for BTC.
An+Investor's+Take+on+Cryptoassets+v6.pdf