Tag Archives: eth

Books, Crypto, Entertainment, Etherum, Movies

Ridley Scott to Produce ‘The Infinite Machine’ ETH Origin Story from Camila Russo’s Book

The future of Ethereum, DAOs, Defi and Web3 set to become mainstream with movie tracing its history

Ridley Scott’s production company, Scott Free Productions, is slated to produce a feature film based the book, which tells the story of Ethereum, ‘The Infinite Machine‘ written by cryptocurrency crusader and journalist Camila Russo, and has Shyam Madiraju attached as director. Tom Moran, Vera Meyer, and Alejandro Miranda are also onboard, according to Deadline.

With Ridley Stott’s credits running the gamut from ‘Blade Runner‘, to ‘The Last Duel’, to Alien, to Gladiator, and too many more to count, plus production credits for Scott Free that are no less impressive, the upcoming films appears set to be big.

Ethereum co-founder Vitalik Buterin will play prominently in the story, showing the early and incredible initial launch, inspired by the self-taught 19 year-old, into what is now the world’s second largest cryptocurrency (Ether) and, according to Ethereum.org is a technology that’s home to digital money, global payments, and applications. The current ‘market cap’ for Ethereum is nearly $400 billion.

The story up to the present day is fascinating enough, with the meteoric rise of Ethereum from the founding in 2015 to the announcement of this project. Particularly noteworthy is the connection between the Ethereum blockchain technology and the invention of NFTs (Non-fungible tokens), DeFi (decentralized finance), D.A.O.s (Decentralized autonomous organizations) and more.

Camila Russo, author of “The Infinite Machine”, also founded TheDefiant( thedefiant.io ) which “curates, digests, and analyzes all the major developments in decentralized finance, so that you can stay informed and smart about the most cutting-edge and fastest-changing corner of crypto and finance” according to the site itself.

The film project has already started to make waves and accomplish meaningful buzz in a deep layered, totally coherent approach to its creation. Namely, the fact that part of the fundraising for the film is taking place via NFT collections. This bold move has been incredibly well timed and successful, with the first @ETHMovie collection selling out completely within 28 hours and raising $670,000 in the process.

This funding, along with subsequent NFT collections offered are being managed via The Infinite Machine DAO community treasury, along with traditional film financing techniques. The DAO is, itself, the executive producer of the movie.

According to the official site for the film, the NFT collection sales will be equally distributed amongst the 36 intervening artist which will receive 22.5% of the budget. 10% will be sent to a community treasury pool to fund the DAO, and the 67.5% will be used for the movie.

‘It’s incredibly exciting to have Ridley Scott and the crew at Scott Free produce the movie of The Infinite Machine alongside us. I can’t imagine a better team to turn the riveting story about the people behind the most revolutionary technology since the internet into a feature film that will capture the hearts of our generation.‘

Camila Russo as per ‘DeaDline’

This groundbreaking funding mechanism, in this case for a movie that is intended to “become a blockbuster movie for the mainstream”, is part and parcel of the radical yet optimistic and hopeful changes that DAOs, NFTs, DeFi all were created to achieve, within the greater context of Web3 and the Ethereum blockchain itself. In other words, making this film is itself proof that the subject matter is alive, kicking and becoming more real (and dangerous, to some) in real time.

Traditional funding and monetary distribution channels, from the creative genesis of an idea (in this case the book) to a fully formed commercially released product and its proceeds, are by comparison, woefully inadequate and generally corrupt and unfair, according to many artists and creators super-pumped for the transition to these new methods made possible by Ethereum, blockchain, and soon, Web3.

So from the story, in both book and movie, to the NFT collections, the the DAO created to executive produce and partially fund the film, there is a thread of real-life proof-of-concept running throughout.

That proof is that, far from being a far flung, possible flash-in-the-pan, the entire saga, beginning with 19-year-old Vitalik Buterin’s idea to expand the potential of block chain, is destined to come to spectacular fruition, and sooner than you might believe.

Culminating the relatively short history of the last 7 years, all the way to the present day explosion of work, massive capital investments and development of Ethereum, along with its various applications and use-cases, we could be inexorably headed toward a moment in the near-future when the film will crash head-on into the realization of the very dream scenario it depicts. Oh boy howdy.

Below, the breakdown of the The Infinite Machine DAO funding plan:

Before the Movie Budget is Covered

Distribution of primary and secondary sales:

  • 22.5% in an equal basis amongst the 36 intervening artists
  • 10.0% to a community treasury pool used to seed The Infinite Machine DAO
  • 67.5% to cover the movie budget up to $16M. That number may be reduced depending on the amount of funds raised via traditional means.

After the Movie budget is covered

Distribution of secondary trading fees and any other revenues from all collections:

  • 22.5% will be received by the artists in this collection 
  • 25.0% will be received by the NFT Collection core team and contributors 
  • 52.5% will be used to fund a community pool to seed The Infinite Machine DAO

Camila Russo spent eight years at Bloomberg covering the Argentine market (bonds, stocks, FX) for 4+ years based in Buenos Aires; she wrote about European stocks with a focus on Southern Europe in Madrid; analyzed macro emerging markets moves for the Markets Live blog in New York; and was one of the most prolific and dedicated cryptocurrency reporters.

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Crypto, Elon Musk, Twitter

Bitcoin’s Origins get Well-timed Mention in Elon Musk Tweet

The ‘why’ of Bitcoin is back in the news

Bitcoin’s history and origination is an important factor for more than just true believers and maximalists. Created in the aftermath of the 2008 financial crisis, and with evidence that it was intended, by its founder, known only as Satoshi Nakamoto, as remedy for the failed system that had nearly collapsed the world economic system at that time.

In a recent CoinDesk post, Nathan Thompson wrote: Bitcoin’s genesis block is historic, not just because it contained the first 50 bitcoins, but because it had a message coded in the hash code: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”

The bank bailouts and various financial system failures were integral, then, in the creation and purpose of bitcoin, and one could even say, coins and systems that followed, starting with Ethereum in 2015.

After a few weeks of tweets revolving around the Twitter buyout brouhaha, Elon Musk, in a reply, added, in a more introspective tone than has been seen of late, some of his thoughts on the subject;

Interesting timing and a nice shift from the obsession with prices

The recent “crash” and panicked voices over the drop of the bitcoin price below $30k is the unspoken background addressed in this exchange, it appears.

Decrying the erroneous belief that “prices only go up” held by the public at large during the doomed run up to the 2008-2009 crisis could be seen as a hint that, perhaps, prices of assets like Bitcoin, and Tesla shares, for that matter, can not “only go up” and anyone who seeks such a preposterous nirvana is digging their own graves, having failed to learn from all the times in history that fools took the path of peak greed and self-delusion.

Worse, and worth being singled out specifically, are those that profited from the delusion of others in “predatory lending” practices, which Elon Musk “doesn’t support”.

Ultimately for this tweet thread, it was Elon Musk’s Twitter buddy @BillyM2k that nailed it with a series of tweets explicitly spelling out the divergence between the founders and believers in the original, positive, intent of bitcoin and the massive bubble of speculators and scammers that has, in his view unfortunately, grown up around it.

The Best Books on Cryptocurrency

Pointing out that DogeCoin, as an example, was created to highlight the stupidity of speculation and excess greed that came with the avalanche of meme-coins and “shitcoins” etc, that flooded the market and, to a great degree, obscured the original, positive force that bitcoin and decentralized finance was invented to be.

https://twitter.com/BillyM2k/status/1525274042592202752?s=20&t=yenGWhR_EZDBYDoUwOhnZg

Maybe, some of the various challenges and stumbles that Elon Musk is experiencing lately, seemingly for the first time, after a string of incredible triumphs, culminating with the Person of the Year designation and the buyout launch that is now in limbo, will inspire him to be more reflective and use his powerful position as a “Twitter-sage” to draw more attention to the need for a voice of “reason”, rather than as a cheerleader for the bonfires of vanity and speculation.

https://twitter.com/BillyM2k/status/1525277905319628801?s=20&t=yenGWhR_EZDBYDoUwOhnZg

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News, Tech, web3

Curious Kids: what are NFTs – and why are they so expensive?

What is the purpose of making NFTs and what makes some of them so costly? – Tanvi, aged 16, Delhi, India

An NFT is a technology that proves who the owner of a digital object is. This digital object could be a song, a picture, a video, a tweet – or even a piece of digital land in an online game or virtual world. Recently, pieces of digital land in a forthcoming virtual world called Otherside sold for nearly US$6,000 (£4,791) each. What’s more, people were so keen to buy them that they also paid thousands of dollars in transaction fees.

NFT stands for non-fungible token. If something is non-fungible, this means that it cannot be replaced or exchanged for something of identical value. An example of something fungible is a current coin, such as a one pound coin, because this can be exchanged for another pound coin. It doesn’t matter which of the coins you have – you still have £1.

Something like a painting, though, is non-fungible. That particular painting only exists once. If you bought a painting, you could take that painting and hang it up in your bedroom. It would be yours – no one else would own that exact painting.

Owning something is more tricky for digital objects, because they can be copied. For instance, if you find a picture online that you like, you can right-click it, save it in your computer, and use it as a background if you want. This is where NFTs come in.

If you bought an NFT of a digital painting from the person who made it, a record of your purchase is kept in the blockchain. The blockchain is a giant database maintained by many people in their computers, and it is almost impossible to alter. Once the blockchain keeps a record of a transaction, it’s there forever. Everyone can see that you bought the NFT – and it proves that you are the only owner of the digital painting.

High values

Some digital objects have been bought for large sums of money. For instance, in 2021, the first tweet ever sent was sold for almost US$3 million. But why would someone pay so much money for an NFT?

First of all, most NFTs actually have a low price. We just only get to hear about them whenever there has been a record sale. It is the same with physical art. We hear about it when someone paid millions for a painting by a famous artist like Picasso, and never about all the paintings sold for much less.

The Best Books on Cryptocurrency

Like physical things, the value of digital art or other digital objects depends on how much someone is willing to pay for it – and that can come down to a lot of factors.

The person buying it might think it is very beautiful or important, and so is happy to pay a lot of money for it. The person who bought the first tweet, businessman Sina Estavi, wrote about it on Twitter, saying, “This is not just a tweet! I think years later people will realise the true value of this tweet, like the Mona Lisa painting”.

The Mona Lisa, a painting by the Renaissance artist Leonardo da Vinci, is one of the most famous pieces of art in the world. It hangs in the Louvre gallery in Paris, and millions of people go to see it each year.

As well as the fact that the first tweet is unique and historical, buying it is also a matter of status. Only one person in the world can say that they own the first tweet ever sent.

In a bubble

Another reason NFTs might be so expensive is because of something economists call a bubble. We say that there is a bubble in a market when investors buy things with the main prospect of selling them shortly afterwards at a higher price. This pushes the price up.

Bubbles tend to occur whenever new technology appears. Plenty of investors come with their money after hearing about the astronomical price of a new technology, or about celebrities buying them. They buy them without fully understanding them, just attracted by the money they might be able to make by selling them on. Some people think this is what is happening with NFTs.

This is not to say that NFTs have no value: it is to say that some of the people buying them are doing so solely to obtain a profit, not because they are interested in owning an image.

Another reason NFTs might be so expensive is because of the potential they have to link with the metaverse. The metaverse is a virtual universe in which people would be represented by avatars and own digital space, like the digital land sold in the Otherside virtual world.

In the future, NFTs could be displayed in this digital space, in the same way we might hang a painting up in a physical house. It will probably also be possible to convert some of them into unique avatars that the owner can use to interact in that world. Since Otherside is owned by the same company that created a famous collection called the Bored Ape Yacht Club, maybe there will be a way in future for avatar versions of these apes and other NFTs to move around in the Otherwise metaverse.

Francesc Rodriguez-Tous, Lecturer in Banking, City, University of London

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Crypto, Economics, Finance, Observation

Elon Musk and Jack Dorsey vs. Warren Buffett and the Status Quo

Video

Above: Photo Collage Lynxotic – various

Bitcoin and Crypto’s reached a major turning point: why is cryptocurrency worth anything?

In a recent interview clip Jack Dorsey quietly states his opinion on the difference between people who “get” blockchain and crypto, and those that will forever be married to the past:

watch:

This is the simply stated portion that says it all:

“People who have questions in the world, people who have curiosity (and are) recognizing that the current systems, wether they be corporate financial systems or the government financial systems just aren’t working for them…”

Although the context of his statement is regarding bitcoin as the native currency for the internet, and in particular how people are responding to the fact that financial systems “just aren’t working for them” it is, nevertheless, a perfect statement of how the world is changing.

It has already changed into two distinct groups: those that are clinging to the status quo, since it has worked very well for them, and those that want to find a new and better way, because, in most cases, the current system did not work for them.

It’s important to realize that this statement is not coming from a disgruntled outsider, but from the hugely successful founder of Square, now called Block.

The fact that a large group of highly successful business leaders, such as Jack Dorsey and Elon Musk, although benefiting massively from the current financial systems, are at the same time embracing a new way of thought and action for the future, is at the crux of the issues addressed in this post.

Buffet vs Musk & Dorsey and the zero sum mindset of Malthusian Capitalism

There is a war waging between those that are open to, and welcoming of, bitcoin, crypto, blockchain, DeFi and other new financial innovations and those that reject all of it and would like nothing more than to see it stopped, by any means necessary.

The derision, insults and disdain lobbed at bitcoin, crypto and anyone that believes in them, by the “old guard” epitomized by Warren Buffet and Charlie Munger are now well known and documented:

A few quotes:

“Probably rat poison squared.” — Warren Buffett in Fox Business interview at 2018 meeting

“I think I should say modestly that the whole damn development is disgusting and contrary to the interests of civilization” – Charlie Munger vice chairman at Berkshire Hathaway

“I certainly didn’t invest in crypto. I’m proud of the fact I’ve avoided it. It’s like a venereal disease or something. I just regard it as beneath contempt.” – Charlie Munger vice chairman at Berkshire Hathaway

Interestingly, if you look deeper at the interviews and quotes, you’d see that, in spite of the headline grabbing hyperbole, it’s the price speculation that is at the heart of the criticism.

The comments that crypto and bitcoin “don’t produce anything” are ridiculous on their face, as if the fiat dollar “produces” products, services or anything else.

Oh, wait, the dollar does “produce” inflation (loss in value), and has done so very dependably over the last 100+ years.

Take a stat so well known that it is almost a cliché, any way you put it: a 2013 U.S. dollar (the year the federal reserve was created, not coincidentally) would be worth more than 16x what a dollar is worth today. One has to ask where that value is now?

Bitcoin, however, has over time only gained value. A lot. If bitcoin is rat poison, maybe the fiat system and the federal reverse are the rat?

100 year old billionaires are, aparently, not inclined to speak from enlightened self-interest. Or, to be kind, perhaps they are blinded by the success they enjoyed in a system that favors anyone at the top of the pyramid, one built on value theft?

One very big caveat, however, is clearly that the “everything bubble” is bursting, price speculation always ends in price crashes, and the massive gains in the value of various cryptocurrencies are a symptom of a larger systemic emergency, rather than a quality inherent to crypto itself. There’s that.

The gap between this kind of thinking vs. that of the forward looking cryptocurrency proponents, and what they consider to be positive innovations, is vast. In a time where divisive thought is nearly ubiquitous this is not news.

However, the fact that the legions of those that “get it” are as large as they are, and that they are constantly growing, has clearly taken the debate past the point of no return.

To get the full view of this divide it’s important to look also at just how the nearly 100 year old duo of Buffet & Munger got to be the “legends” that they are.

All the best known names they are associated with, from the initial Berkshire Hathaway purchase in 1962 to more recent investments in companies such as CocaCola, GEICO Insurance, RJ Reynolds Tobacco, Sees Candy, Clayton Homes and so on, paint a clear picture of extreme hierarchal and exploitative capitalism that is solely based on making themselves and shareholders rich, and doing it on the backs of consumers.

In an example of the thinking of those that do not worship the duo, in The Nation, David Dayen wrote: “America isn’t supposed to allow moats, much less reward them. Our economic system, we claim, is founded on free and fair competition. We have laws over a century old designed to break up concentrated industries, encouraging innovation and risk-taking. In other words, Buffett’s investment strategy should not legally be available, to him or anyone else.”

Exactly this kind of double standard, corrupt to the core, is built on systemic greed founded on a Malthusian “zero-sum mindset”. This is what has led millions to conclude that the system just isn’t working for them.

Being championed ad nausea for this lifetime of “achievement” is part and parcel of the status quo that many, from many in the 99% to the “nouveau 1%”, such as Elon Musk, Jack Dorsey, Vitalik Buterin and many others, are actively seeking alternatives to.

That distinction, being rich and powerful and yet not satisfied with the legacy of corruption and greed, is at the heart of the new wave of thought that has made bitcoin, crypto and DeFi a force to be reckoned with.

Moreover, seeing the state of the world that centuries of this kind of thinking has engendered, it’s natural for the young and more enlightened to want to search for other ways for things to work, ways that perhaps champion something other than monopolistic greed and exploitation.

In a recent Interview Elon Musk addressed precisely this issue – how many in the current system are focused on prospering at the expense of others and maintaining a zero-sum mindset. In the clip he outlines how important it is to understand the failure of that approach.

watch:

The idea that crypto will disappear is wishful thinking by those that cling to the systems of the past

A clip of Harrison Ford speaking at the Global Climate Action Summit was banned on some platforms as incendiary. Why? Because he passionately accuses those that are financially linked to fossil fuels of working to spread disinformation and misinformation, in order to perpetuate their massive incomes, even while the planet is on the brink of climate disaster.

Blocking this opinion, from a rich and famous film star, no less, is typical in the way that the established system works to suppress the idea that you should do anything about the fact that “it’s just not working” for you.

This is the same divide, mentioned above, that is nearly all pervasive today, but will never stop innovation in thinking about financial systems. It will not stop DeFi or DAOs or crypto or bitcoin.

It will not stop sustainable energy from becoming an ever bigger part of the world’s energy infrastructure. The point of going back has long since passed.

How money works according to Musk

Jack Dorsey has an understated and somehow “quiet” way of expressing revolutionary ideas. Elon Musk, on the other hand, is well known for controversial and flamboyant statements, and especially tweets.

But to get a taste of just how radical his thinking really is, particularly to those that disagree, you have to dig deeper into lengthy interviews, such as those with Lex Fridman, where he reveals his thinking more specifically on money, crypto and the governments role in the system of money.

watch:

Coming from the wealthiest person on earth, some may find it odd, yet his thoughts on crypto vs fiat money are well documented. It’s just this kind of stance, taken by so many in the “new” establishment at the top of the current financial pyramid, who also see the necessity for change toward new ideas and systems that can so away with the worst of the status quo, well represented above by Buffet & Munger and other “crypto haters”.

Government is a corporation in the limit

In yet another interview excerpt, Musk goes even deeper into his belief that – in his exact words: “if you don’t like corporations should really hate governments”

watch:

While this particular statement arose out of a spat with Senator Elizabeth Warren regarding taxes, the overall concept of challenging the status quo and the, clearly failed, systems perpetuated, remains in play.

Web3, and how Web2 and legacy financial structures are linked

Although fraught with infighting – the typical bitcoin vs. Ethereum vs. Doge vs. Shiba Inu internal debates and criticisms are not on the magnitude of the division between those that generally support and benefit from, for example, status quo financial structure and fossil fuel business, vs those that favor Blockchain and Sustainable energy.

Further, the spirit of the clash between Web2 and Web3 rests not on the tech or the systems themselves, which it can be argued are the same, but on the beliefs and intent of each camp.

The surveillance capitalism business models of web2, epitomized by Facebook and Google are diametrically opposed to the spirit and stated goals of web3, just as bitcoin was created out of a time that, not coincidentally, corresponded to the 2008 crash and crisis born of the greed and corruption of the legacy economic establishment.

There are two distinct camps that have emerged.

Those, such as Tesla and Elon Musk, that reject the traditional holy grail of shareholder value and instead embrace, for example, a more enlightened mission “to accelerate the transition to sustainable energy”. This aligns with any individual choosing the support crypto as a “Hodler” or at least believer, vs. those that support the legacy systems of finance, the fossil fuel industrial complex and Web2’s exploitative business model.

This divide is the ultimate test of our time and it will only grow in stature and importance.

The correspondence between forward looking innovation in all human thought, communication and action is already too big to stop and cannot be wished away.

There will undoubtedly be setbacks to these new directions, and there will be attacks using more than insults, such as those quoted above, but the time for the unstoppable force to be quelled is long since past. Coke and a smile? No thanks.

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AI, Apps, Photography, Software, Tech

PhotoShop is Maxxed NFT with “NFT Prep” feature on the way from Adobe

Above: Photo Collage / Lynxotic

The Verge interview with Adobe’s CPO, has mega details

In a new, extensive, Verge interview podcast with Adobe’s CPO, Scott Belsky, a a ‘Prepare as NFT’ system launch for Photoshop was confirmed for the end of the month. 

The idea is to maintain a kind of proof of originality system to help prevent fake NFTs (minting non-fungible tokens) from being minted and sold by imposters. The final choice is in the buyers hands at this stage, but having a way for creators to prove authenticity would be a big step.

Since this week Adobe is also holding its annual conference, called Adobe Max, there are also a bunch of new features arriving for Creative Cloud and a slew of app including Photoshop. 

Intersecting worlds collide with Adobe in them all…

Adobe has been around, amazingly, since 1982, and millions of digital creatives and content creators use their products.

Photoshop is so entrenched that it has long achieved verb status: if you want to enhance a photo, for example to enlarge your backside or smooth out your skin, just “photoshop it”. And over use is derided as a “photoshopped” persona or image. 

Premiere Pro and After Effects, especially the latter, get a lot of pro and semi-pro use for video production. Many, many Pro photographers use Lightroom. The upgrade system for Adobe products and the creative cloud, such as the recent AI and neural engine assisted effects drive change and upgrades at a furious pace. 

With the entire content, image and video creation industry becoming more and more vital to networked human communications, tracing and verifying authorship and authenticity are becoming more and more crucial. 

Adobe is moving, with caution due to the issues that could arise, into the area on multiple fronts. As per the Verge article;

“With what Adobe is calling Content Credentials, creators will be able to link their Adobe ID with their crypto wallet and mint their work with participating NFT marketplaces. The software company says the feature should be compatible with popular NFT marketplaces including OpenSea, KnownOrigin, SuperRare, and Rarible. A ‘verified certificate’ that comes with minting an NFT with Photoshop’s Content Credentials will prove that the source of the art is authentic.”

Read More at:

The Verge

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Crypto

Anyone got Norton 360? Now you’re a Crypto Miner

Norton has announced integrated Ethereum mining software

Norton Antivirus software, and the company that makes it, NortonLifeLock , best known for being bundled annoyingly in new Windows computers, has announced via press release that they intend to bundle a feature they call “Norton™ Crypto”.

The feature which they say will be added to Norton360 starting tomorrow for “early adopters” to begin mining from within the already installed software.

They are also, with a very helpful tone, declaring that they will also bundle an ethereum wallet which will be safely stored in “the cloud” so it won’t be lost.

They do not specify any minimum computing requirements but they do say that :

“Norton Crypto is expected to become available to all Norton 360 customers1 in the coming weeks.”

Yo’ dude this shit’s getting real

So, although this comes off as a somewhat desperate attempt to try and maintain relevance after likely millions of forced installations are never monetized (just a guess) it nevertheless could send millions of civilians into crypto mining without “just a few clicks”.

This brings up so many questions immediately it’s a bit mind-boggling. Although the first media reactions, predictably, mention “environmental” issues and take a negative tone, doubting why anyone would want to risk “taxing” the computer’s GPU for such a task.

Of course questions such as how mining efficiency would be affected by millions of “micro-miners” there is also the question of why wouldn’t a virus software subscriber want to essential use their idle computer resources to pay for the software itself (cut to happy Norton execs congratulating themselves on the genius idea).

Above:Photo Credit / Norton

Could there be another story here? Mainstream experience with crypto, demystifying the blockchain?

Further and more interestingly. If more mainstream software companies and even service subscription software companies follow suit and millions if not hundreds of millions of average people begin collecting small months ethereum “dividends”, even if only $10 per month, how easy is it to put the Genie back into the bottle, so to speak?

When millions are not “irresponsibly” using dollars or euros to purchase cryptocurrencies, but rather, instead “earn” a few extra dollars, once the coins are traded for local “hard” (read: fiat) currencies, here and there for each computer or GPU they own, can the whole thing, like green stamps, air miles, credit card loyalty program be suddenly outlawed?

As appears everywhere more and more on a daily basis, isn’t crypto, via Bitcoin, Ethereum and many various alt coins, become more and more woven into the financial system? Isn’t the number of people who own, buy or even mine crypto exploding exponentially on a daily basis?

Isn’t this just one more sign that the trend of crypto becoming “normalized” and woven more and more deeply into the fabric of our lives is not likely to reverse itself?

Yes. That’s the answer. More news tomorrow, probably.

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Business, Crypto, Economics, Finance, Observation

Bitcoin and Crypto’s Crash is not the First, the Largest or the Last

Above: Photo by Michael Krahn on Unsplash with elements added by Lynxotic

Coming after a frenzied run-up the hand wringing is no surprise

I many ways it seems as if Bitcoin and Cryptocurrencies appeared suddenly in 2021 out of the head of Zeus. Protean and fully formed, with billions and trillions in market caps, and all your sisters, brothers, cousins and even the Uber driver climbing aboard.

And the FOMO blog posts, where every hour an innocent reader is assaulted by a story, perhaps true, perhaps exaggerated and certainly foolhardy in retrospect, of an innocent putting their life savings into Dogecoin and suddenly having, theoretically, huge gains at their disposal.

Meanwhile, craggy faced, ancient stock market mavens would interject famous last words that now appear to be wise. However, all that notwithstanding, this week’s crash is nothing new or unexpected.

In reality, as can be seen from the graphic below, provided by Visual Capitalist, there have been so may crashes / corrections and doomsday prognostications since 2012 in Bitcoin that it seems like a miracle the there’s any thing such as Crypto at all.

There’s a reason it’s not dead and it’s in the DNA

The resiliency, far from a shock to those that have been around more than a fortnight, is kinda the point. When Satoshi Nakamoto built the system architecture of Bitcoin and since then inspired the over 8000 new crypto entities that have been developed, it was, just like the internet itself that was build to survive WWIII, supposed to be as indestructible as possible.

Like physical gold, which is considered have been adopted as a store of value partly due to its indestructibility and immutability (alchemy notwithstanding) the volatility and sometimes violent-seeming life story of Bitcoin is a necessary adjust to its role in finance, commerce and even individual monetary survival.

Not for the faint of heart, perhaps

While the mainstream and those forces opposed to the adoption or survival of Bitcoin and Crypto are out in force pointing to the “unsuitability” of Bitcoin and other cryptocurrencies for any “legitimate” use as a trade or savings vehicle, the progress so far, in spite of the obvious fact that volatility has always been baked in to the situation, is an obvious refutation of that viewpoint.

Will the current drop in dollar values relative to Bitcoin end it’s popularity and strip it of the respect it has thusfrar earned among many? In a word, no. In essence what is happening is, as many have foretold, what happens often and repeatedly, the excess attention and dollars that were pumped into crypto by you brother, sister, cousin and Uber driver are now getting blown out, since those were more speculation and psychosis than any kind of vote for viability or permanency.

And, why not? Where was to concern, shock and hesitation by the masses when the prices seemed to only rise for weeks and even months across so many products and coins it was impossible to keep count? Why was to feeding frenzy and the mania-like piling on not ignored as an anomaly?

The herd does as the herd will do. Diamond hands and Paper hands will ebb and flow as long as the rivers flow to the sea and humans herd like buffalo. And, in all likelihood, dollars and euros and yen will be long forgotten when the last bitcoin is transferred to the final wallet in the sky.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Lynxotic does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Business, Crypto, Economics, Finance

Elon Musk is taking sides in the ‘True Battle’ between Crypto & Fiat

Video

Above:Photo Credit / Unsplash / Collage / Lynxotic

If you are stuck on the word ‘fiat’ this post can help you (everyone else too)

In a single, 14 word reply to a follower (@TheRealShifo) that asked “Yo Elon what do you think about the peeps who are angry at you because of crypto?” He gave a simple answer that is the often unmentioned, yet most important, question regarding crypto vs. fiat, government issued, currency such as the US dollar.

Looking around during the ongoing frenzy surrounding crypto and digital finance you’ll see countless ‘news” stories and blog posts comparing, or pretending to compare cryptocurrencies, especially the two biggest Bitcoin and Ethereum (as coin sometimes referred to as “Ether”) and they virtually always quote the “price” fluctuations of those coins as a certain number of dollars and cents.

Interestingly I have yet to see any of these “comparisons” use the reverse valuation method, such as, “the US dollar is currently worth .00002703 Bitcoin. Can you imagine everything using that as a standard – CNBC quoting stock prices in Bitcoin, your house is “worth” 32 Bitcoins (if you’re in California, for example).

The reason this comes off sounding strange and ridiculous is that all communication related to the US dollar, which has been a fiat currency since abandoning any “backing” (such as gold) and continuing on by decree (or fiat) of the government with no backing other than than decree, also carries a decree (tacit) not to undermine it in public.

So when Elon says:

“The true battle is between fiat & crypto. On balance, I support the latter.”

Simple and straightforward and yet intentionally shrouded in mystery

Musk is directly comparing crypto, generally, and fiat currencies around the world that “float” against each other. And by inference, doing so in terms of the difference between a fiat currency like the US Dollar and a crypto currency, like Bitcoin.

A fiat currency is money that is not backed by a physical commodity like gold, but instead backed by the government that issued it. Most modern currencies, such as the U.S. dollar, euro, pound and yen, are fiat money.

from Wikipedia

The term fiat derives from the Latin word fiat, meaning “let it be done” used in the sense of an order, decree or resolution.

— common Definition

The fact that Bitcoin was created as a digital alternative to fiat money stands at the forefront of that point. The fact that it was designed precisely to counter the drawbacks and dangers of a system based on fiat paper money (or digital ledgers of those paper dollars such as your bank balance or any method to keep track of how many “imaginary” paper dollars you “have”) is exactly the real issue at hand.

photo credit: twitter

It’s no secret that many attack those goals and intentions superficially and dismiss the entire discussion with a wave of the hand. They willfully use the complexity of the cryptographic solutions, at the heart of cryptocurrency, as a way to gloss over the real and substantive problems being targeted.

They prey on the ignorance of the majority to try and discount out of hand any value at all for the movement and the various products.

Opening up the door to this exact exchange and characterizing it as a “battle” in one fowl swoop clarifies and simplifies the real issues and the real reason for the existence, and according to many, including Elon Musk, the need for monetary “reform” or change via a shift toward crypto.

Opening up the door to this exact exchange and characterizing it as a “battle” in one fowl-swoop clarifies and simplifies the real issues and the real reason for the existence of, and the need for, monetary “reform” or change via a shift toward crypto.

D.L.

The “price” of Bitcoin or any other crypto currency on any given day has almost nothing whatsoever to do with that debate.

Speculation abounds but not just in Crypto

The “price” is a function of, mostly, speculation and scarcity, due, in the case of Bitcoin to the mining cap, or at least a perceived scarcity. And additionally the various perceived advantages of crypto such as privacy, decentralization, use of block chain systems, etc.

But the price is like the smoke above the battlefield, not the reason for the battle or any indicator who is winning or who is on the side of might or right.

Two major questions that arise from this tweet and the potential shift toward a clearer and simpler dialogue on crypto are the following:

  1. Is crypto generally, and Bitcoin / Ether more specifically established and entrenched enough to withstand the coming backlash from governments that feel threatened and other status quo institutions that will do whatever it takes to discourage or even stamp out crypto usage?
  2. Will the very battle itself, that Elon Musk says is the current “true” battle, bring even more attention to the weaknesses and problems with the current fiat money system and thereby increase, perhaps inadvertently yet massively, the size of the battle and its stakes?

Alternative systems of trade have been tolerated in the US for some time now. How are those air miles doing? What about the chips and points for perks you got at the Indian Casino? Is it too late to outlaw all crypto without causing a revolution in the streets?

The other side of the (clipped) coin

It is truly surprising to see how little is to be found in the media about the deeper reasons for the rise of crypto. How it sometimes seems like direct criticism of fiat currency is almost taboo.

Naturally any internet search will find many “rabbit hole” sources for all kinds of information critical of the current monetary system, the same system the near total collapse of which in 2008 inspired the creation of bitcoin.

It appears that Elon Musk is emphasizing, in a subdued manner, exactly the way that the nonsense-furor over huge price gains or declines is completely missing the actual point. The “true battle”.

Many stories in the media and millions of private comments are currently following a kind of convoluted logic – first the popularity of crypto (which is linked to the unpopularity of the very messed up fiat system) artificially and massively increases prices in many crypto assets.

This “bubble”, a typical outcome of human herding behavior in financial markets, inevitably bursts or sees large setbacks. Then the coin or crypto system itself is blamed for the human stupidity and greed that caused the distortions of price, just like happened in the dot-com bubble and the 2007 housing bubble and subsequent crash.

The difference is that the crypto bubble, in an interesting way, is in reality due to a surge in skepticism toward fiat currencies, a boom in the prevalence of mistrust toward governments and a combination of fear and greed that is growing, not dissipating.

Although many have rightly criticized Elon Musk’s tweets and odd Saturday Night Live appearance, and there is a kind of mini-backlash (growing?) against all things Musk, in this case it is a healthy and wise tweet that we have shown above.

Reframing, or more aptly refocusing the discussion away from prices and speculative profits and back to the real reasons that cryptos were initially created and why it has gained such massive support is a welcome shift. That this reframing comes from the likes of Musk himself, is fitting and who better to put forth a message to simplify and clarify the nature of the real “battle” at hand.

The following video has some interesting data and arguments for, and mainly against, the fiat regime under which we have lived for most of the last century. Although, in a sense, a kind of advertisement for Gold and Silver, the overview is nevertheless accurate and does not exaggerate the dangers and issues that revolve around the fiat system.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Lynxotic does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Find books on Money and many other topics at our sister site: Cherrybooks on Bookshop.org

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Business, Economics, Finance, Observation, Tech

There’s more to Money than Dead Presidents: Crypto is Alive and Well

Above: photo – Dead Presidents Collage – Lynxotic

Haters like Buffet and Mark Cuban’s cheerleading are off base and spreading confusion

Disclaimer first: This opinion article is not investment advice and does not advocate buying any investment vehicle or currency

There are so many misconceptions propagated far and wide these days that it’s hard to choose a place to start. First it’s important to recognize that crypto currencies are not stocks or companies, yes that’s obvious but one of the biggest “anti” argument these days is that there’s an absurdity to the aggregate total value of a “coin” being more than the market cap of the stock of a particular company.

“Ethereum is now worth more than Bank of America”, this nonsense comparison goes, as if the market cap of a stock and the price of a coin times the number of coins in existence has any meaning whatsoever.

Following this logic, however, beneath all the hype, both pro-crypto and anti-crypto, lies a hidden thread to an actual underlying truth.

Though based on obvious common sense, this thread is potentially confusing and convoluted, to say the least. But without seeing it clearly the misconceptions will just keep getting more ridiculous.

In order to illustrate the conundrum a bit of background is needed. For example:

Stocks, in the US are priced in dollars. But how are dollars priced? Isn’t just as accurate to say that when the “price” of the DJIA moves higher (3,4050 at this writing) it is the value of the dollar, in relation to the DJIA that went down?

While this requires a kind of mental gymnastics, these are only due to the constant bombardment meant to keep you from seeing this 100% valid way of viewing stock valuations based in dollars.

There’s another kind of tacit misinformation and that is stating that “inflation” is only relevant when it’s measured by the government. For example if the “bull market” that began in 2009 and continues into 2021 represented a huge increase in stock prices, that is asset inflation.

The inverse of asset inflation is a reduction in dollar value. Less shares of a given stock can be bought for the same number of dollars. The dollars are worth less.

Read more:

And further, crypto, such as BitCoin is measured as having more or less value in dollars. Who is to say the massive rise in the dollar “value” of BitCoin is not representative of a decline in the “intrinsic” value of dollars.

The truth is often hidden in plain sight and that is what drives traditional markets

And that is precisely the point. BitCoin’s existence, which is locked in the mind of Satoshi Nakamoto (if he indeed exists) was indicated cryptically (no pun intended) to be a kind of answer to the instability of the global financial system as was evidence in the crisis of 2008. Taking place nearly concurrently with the birth of the idea of BitCoin.

Seeing the dollar as having a “stable” value and measuring a companies value, via it’s share price, is, let’s just say, perhaps 100 times more absurd than the Dogecoin dog.

Why? Because, for nearly a century the dollar is not backed or moored to anything but the government’s hope that it will retain value and laws that prohibit you and I from using other vehicles as “legal tender”.

The data (and opinions) on this are seemingly endless and yet absolutely critical to understanding our monetary system and where crypto may or may not fit in.

Horseshoe Nails and The Isle of Yap

Many interesting historical facts point toward the reality that money and coinage has always been just as much about the abstract belief in the system, more than any particular “intrinsic” value.

On the Micronesian Isle of Yap there was a functioning monetary system based on huge stones. A New York Times article, published in 1971 described the curious system:

“Every piece has an owner, and everyone knows who the owner is. Even when the money changes hands, it usually stays put. Yapese stone money is the largest and heaviest “coin” in the world.

In earlier days, brave islanders paddled by canoe 300 miles across open ocean to Palau where they cut slices from huge stalactites and brought them back as money. The value depended on how many men were drowned bringing them back. Nowadays, value is usually determined by measurements. We heard various versions, ranging from $10 radial inch to $42 a foot.”

Another article explains that many “wealthy” home (hut) owners displayed their money by leaving it leaning against the front of the house, where all could see the prosperity.

And, as for the prevention of fraud and corruption in any monetary system? Could any be more corrupt than the one that led to credit default swaps and mortgage-backed securities imploding and all the BS that nearly brought down the world’s banking system?

And that is not new either. In the 1800s traveling bank examiners journeyed throughout the US to check on the gold reserves claimed by various banks. More often than not, they found far less gold than was claimed (in today’s fractional banking system little attempt is made to reduce the leverage in the system).

A common, clever, trick to try to “leverage” what little gold was actually on hand was to pile gold coins and ingots on top of a bed of horseshoe nails, hoping that the examiner would weigh the entire concoction only, and never notice the bogus hidden attempt to bolster the weight.

Bitcoin’s system at least attempts to circumvent this typically human brand of fraud and corruption.

In the article “What is Cryptomining” on Techspot a chart was published to illustrate how Satoshi Nakamoto tried to solve the classic trust delimma with the proof of work mining system.

“For example, if Alice has $100 at the beginning of the day, she could promise Bob, Charlie, and David independently that she’d send them each $100 by the end of the day. While Alice could show them that she owns $100 and they’d all be content and agree to the transaction, Alice only has $100. Thus, if at the end of the day, the public ledger (which once finalized is set in stone, so to speak) includes 3 transactions initiated by Alice for $100, the system would be broken and no one would want to use it.

With a centralized system such as in modern day banks, there would exist a single ledger that can validate how much money a certain individual has, and thus it can guarantee that the customer cannot spend more than they own. When talking about a decentralized, peer-to-peer system, however, who’s there to stop a clever individual from spending their money multiple times quickly before getting caught?

To address this potential issue, crypto miners enter the playing field. Essentially, miners play the role of the decentralized banker, and will perform the required gruntwork to ensure that the system is functioning as expected without double-spending. In return for their work, they will be rewarded with some cryptocurrency.”

Buffet, Cuban, Musk & Munger

In clonclusion, Buffet, Munger and The Wall Street Journal may have knowledge and experience but they have also derived benefit from a system that favors those already holding capital, one that also has a tendency to crush those trying to build it.

So, it’s fairly obvious that they are “talking their book” and data mining to produce a self-congratulatory outcome, when they expound on all the reasons that they hate crypto (Munger even called it “disgusting”).

Recent Articles:

As for Musk and Cuban, what’ve they got to lose? At least they “get it”, at least they are open to the idea of a future that has crypto as a part of the financial system. But where will they stand if there is government resistance in a big way, and if attempts to stop the entire crypto movement or “de-fang” it in ways that make it less viable as a true alternative to the status quo? That, my friend, will be the 1000 BitCoin question.

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