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“Mining” Your Visitors?

“Mining” Your Visitors?

Dear Cryptocurrency Enthusiasts:

Don’t ask don’t tell.

Words to live by? Not.

Don’t muck with your website visitors. Ask first.

Aside from all the other goings-on, we now have to concern ourselves with sneaky people. Those who will inject code in their webpages to mine your CPU, basically.

Watch out for those pop-unders.

There is so much information out there, that my two bits aren’t worth the bother. In fact, you can now get hopelessly lost in the crypto-sphere. And have fun at the same time. And make money.

But the webpage miners are being thwarted at every turn.

Is this really a cryptocurrency phenomenon at all? Or is it a social one? Geared toward the criminal element?

Not necessarily and I’ll get to that in a moment.

The webpage mining tech was attracting the users. Even me. I figured I could ask for people to mine a bit of crypto as they read my blog. A bit of extra income.

But many webpage miners didn’t ask you. They got greedy. And they fouled the water for everyone else — for now.

So, can you really make money by grabbing everyone’s CPU power? It seems that the effort has now been largely blocked. So, the short answer is no.

At first, the idea seemed to hold some promise. Help us niche bloggers earn a few extra bucks, but then the dream evaporated, if it ever was more than a dream in the first place.

Many of us have heard about CoinHive and its alleged shady reputation. How you could use their codes on your website and mine cryptocurrency (Monero XMR) by using the CPU power of website visitors. You could even do it without advising your website visitors, which was unethical, to say the least.

The fact that Coinhive did not originally design their software to inform the website visitors that your CPU was being used without your permission, but left it up to the software users to do this, speaks volumes. And even if Coinhive had coded their app to inform website visitors, any good hacker could then strip away those warnings and mine in secret anyway.

If you check, Coinhive’s reputation on Scamadviser you will see that they have a high rating. Really? I say they are going to sink, if they don’t re-gear posthaste.

I experimented with CoinHive for a bit, several months back — on other websites — not here. I let everyone know up front what I was doing.

It was kind of fun, but also kind of a waste of time. I think I earned about 25 cents, but I can’t withdraw that tiny amount, so Coinhive will end up with it, I’m sure.

I think I actually mined most of my own crypto anyway. Every time you logged onto Coinhive’s site, they mine your CPU, essentially.

I experimented two ways on my webpages.

First, I copied the code CoinHive had and pasted it on one of my old Blogspot Blogs (not on this website) that didn’t get any traffic, because like a dummy, I renamed it and screwed up my Google Adsense account – which is another joke.

But the CoinHive miner did work – then. The scripts ran.

Here was my code for embedding all the fun:

Coinhive Sc - Copy

I just copy and pasted. Then I advised everyone what I was doing.

Here’s what pops up (if it works):


miner - Copy


And don’t be fooled, even this demo (above) on the CoinHive website, sucks down CPU power like mad. It’s a live demo! No free lunch.

Well, the above code was improved by CoinHive to alert you that the mining was taking place. (A bit late guys.)

In any event, most ISP’s, Google etc., block the scripts from running. And yes, you can get fancy and try to code workarounds – if you really want to get blacklisted (unless you’re working over TOR or a VPN).

You are certainly welcome to copy my code and try it. Adblock should eat you alive, however. And you may suffer the blacklist. What do you expect from ISP’s these days?

The second method I used from CoinHive was called the “shortlink.” It was kinda neat. A proof-of-work captcha that, in theory (if I was a webmaster and not a simpleton blogger) I could install as a “key” to allow you to read my fine works.

Once activated, the shortlink mined Monero for a moment (on a computer – not a cell phone) then redirected you to a website of my choosing. (I redirected everyone back to my blog.)

Here’s my shortlink:


cnhv.co/ol2


Here’s what it does (maybe):


Coinhive Cap - Copy


However, your Adblockers etc., should kill it.

There are other script miners out there as well.

There’s Popcoin, Crypto-Loot (kind of shady), and others. But they don’t necessarily have good reputations.

There is one website miner out there, however, that does have promise — but it’s also blocked. It looks to be a legitimate crypto in this space.

JseCoin (my affiliate link) does not seem to fall into the bad-boy crowd. But coming on the heels of CoinHive and clan, I wonder if they can pull it off – after their ICO.

JseCoin also has a script miner. Here’s mine:


!function(){var e=document,t=e.createElement(“script”),s=e.getElementsByTagName(“script”)[0];t.type=”text/javascript”,t.async=t.defer=!0,t.src=”https://load.jsecoin.com/load/31935/thecryptopapers.com/optionalSubID/0/”,s.parentNode.insertBefore(t,s)}();


JseCoin is nice enough to have the code all ready, but…as with CoinHive’s script, Adblock eats it up. It will not (usually) work. But I did confirm that the script is functional.

Jsecoin looks like this, when it runs, if it runs:


Jsecoin wsm - Copy


JseCoin does not offer shortlinks, presently, but may offer ads for publishers in the near future.

As for JseCoin itself? I have no idea, but the promise is intriguing. You can also, just like in the old days (2009), mine with your CPU online; and I understand that JseCoin is ASIC resistant as well.

But here’s the thing. All the bad press about the big-bad honcho’s stealing your CPU power (and some did) has not yet caught up with the idea of paying with crypto, hot off the press.

If this crypto-world keeps on going, this kind of thing might become routine. And the naysayers – those who say website mining is theft — might need to get with the program and stop whining for blog hits (like me).

If you are aware of it and agree to pay for some service or visit a website, knowing in advance, that you are financing the site with magic internet money, burned from your CPU, no nitwit can censor your right to do it. And that goes double for the ISP’s and giant internet media farms (given special privileges by governments to hold large landmasses of humans nearly hostage to crappy service).

Oh, I’m not on about Net Neutrality. That’s a red herring, IMO. The internet does not need more regulation, it needs less. More providers should be allowed on the landmasses. Right now, it’s pay to play. As in, fork over bribes to Pauli Politician – to get exclusive territories. That’s just wrong.

Do you really think governments don’t just love it when website/webpage miners are trashed? Sure, they do. It would be the second-to-the-last-straw if we could pay for stuff with CPU power as we surfed the web.

Hey, maybe that’s what JseCoin is seeing… A new world of tiny CPU cryptos and they want to be first in.

The thing is, the tech isn’t right yet. I mean the idea of a webpage miner is a start, but not the whole kitty litter box. We need some more user-friendliness. Maybe some profit-sharing.

There are so many ways to do this. We could all download a small miner to pay for browsing. Use a tiny bit of our CPU for incidentals. One news story from the Wall Street Journal. A free ebook for a few minutes of your CPU.

Websites that benefited could issue prizes, coupons, gasoline credits.

The marketing ideas are endless.

For now, however, the ISP’s etc., are attempting to halt this innovation at the request of the old guard. Webpage mining tech is yet another nail in the FED’s printing-press monopoly. And they are already miffed about bitcoin.

 

 

Sincerely,

 

Jack Shorebird.


 

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The “Bitcoin Cash” Hit Piece

The “Bitcoin Cash” Hit Piece

(Updated November 28, 2017)


Dear Cryptocurrency Enthusiasts:

This is an open letter-blog and assessment of the Mr. John Carvalho and Roger Ver discussion.

Is this the beginning of the end of Bitcoin Cash?

It’s not every day you get to take a peek at the guys and gals – the movers and shakers – in the crypto-sphere. See them in a more human light. See them make mistakes, get angry and do dumb things.

There is no such thing as a Bitcoin Jesus or is there? Well, he is being demoted now.

If you have 45 minutes, you can watch the interview with Bitcoin Jesus, by a less than dignified fellow. It occurred on November 27, 2017.

If you prefer an interpretation, then scan the words below. I have pulled out some of the more interesting highlights.

This is my interpretation of today’s debate between John Carvalho and Bitcoin Jesus — no longer. He is now just plain old Roger Ver these days. And it really gives you a taste of crypto-current-events.

Events that are awash in…problems.

It’ll make you think twice about Bitcoin (BTC)…and Bitcoin Cash (BCH and BCC).

Ver, as many know, was an early supporter of bitcoin, but now supports Bitcoin Cash. That should tell you something. And anyone who thinks that Ver is just a money grubbing corporate type, might end up holding a worthless bag of BTC, but I hope not.

Carvalho, our alleged hero, has a YouTube site called Bitcoin Error Log. He is the CEO of Xotika.TV, which appears to be a porn site.

Carvalho has serious character issues…

You be the judge of John Carvarlo’s character, but I say the guy has near zero credibility. And like Ver advised, I also don’t care if you sell smut for a living, but it does define you. It tells the world what you really are.

(And be careful accessing the Xotika.TV site, it involves a high-risk country, according to Scamadviser.com. Scumbag issues.)

Why Ver agreed to the interview it is beyond me. Smut profiteer interviews self-made millionaire? Go figure.

The smut seller wins debate?

Carvalho of the Bitcoin Error Log (on YouTube) put Roger Ver on the spot today. It was a live debate, but more like a planned hit piece. It is hard to tell if Ver did not deserve it.

Ver was apparently speaking from a hotel room and Carvalho was in his safe-space. It looked like a setup. Carvalho obviously wanted to make Ver look bad. Please tell me if that was not the plan Mr. Carvalho.

Carvalho’s attitude was condescending and Ver seemed to hit back with straight forward answers. Polite most of the time. Until the end, where he lost his composure. (He is only human, but is that an excuse?)

Carvalho spiced his language. Cursed, laughed, derided, and made empty accusations.  Again, what do we expect from his ilk.

And it worked. I began to have doubts about Bitcoin Cash and Ver.

Unfocused debate…more like a Witch Hunt

The debate, if that is what you would like to call it, was apparently supposed to focus, at least in part, on the block-size issues with bitcoin/bitcoin cash; however, the discussion appeared more accusatory and was derailed early on.

Carvalho was the accuser. Ver was on trial, trying to respond to unsubstantiated allegations. A Drumhead Trial from afar.

For starters, as Ver tried to answer questions, there was construction noise nearby and his audio often cut out. This, I’m certain, did not help Ver be heard. At that point I would have asked to debate later. But Ver soldiered on. A mistake.

It did help Carvalho. The beating of the drum…

Carvalho asked why Ver did not like the label “Bcash” for Bitcoin Cash.

Ver stood by his guns. He and the devs like the label Bitcoin Cash, Ver said. The label “Bcash” seems condescending in Ver’s opinion. (See here for how it all started.)

Carvalho wanted to know why he couldn’t call it what he wanted to call it.

Ver tried to explain that the term “Bcash” was obviously negative, so he and others, didn’t care for it.

Pushing buttons…

Carvalho explained that he and others feel that they can label it “Bcash” because there is only one true bitcoin. That seemed to be the crux of it. Carvlaho wanted to give Bitcoin Cash a derogatory name and wouldn’t admit it.

Why not admit it? Sometimes button pushing works and when the pushee admits that, he’s lost the battle.

Ver explained that this was Bitcoin Cash, not “Bcash” and not bitcoin, but Carvalho ignored this. It’s Bcash, he stated repeatedly. A dog with a bone.

This bit of nonsense was repeated by Carvalho. Bcash. Bcash. Every chance he got.

[One might think Ver was being interviewed by a child, but that was the game, was it not, Mr. Carvalho?]

Carvalho asserted that there is only one true bitcoin. He interrupted Ver, as it was explained that Bitcoin Cash was in line with Satoshi Nakamoto’s Whitepaper. These interruptions were obviously designed to keep Ver off balance.

And this is how it went. Ver, trying to be cordial and Carvalho interrupting with “Bcash” and snide remarks. And like I said, it worked.

Carvalho indicated that said bitcoin Whitepaper was not the “bible.” That “we” (meaning the Carvalho porno-gang?) can “agree” that the original bitcoin is the one true bitcoin and the Whitepaper (the original design) is essentially not bitcoin. In other words, if bitcoin’s code changes and the devs diverge from the original vision, it’s still bitcoin original — according to Carvalho.

Certainly, this is a tenuous argument. But Carvalho wouldn’t let go.

And Ver didn’t dislodge that sentiment. It was Ver, big bad corporate man, against bitcoin, a bunch on innocent devs (earning a bit of money on the side from Blockstream and others) working hard — coding.

Carvalho’s assertions…

These repeated assertions by Carvalho seemed to say that old bitcoin is always new bitcoin, even if it’s not in line with Satoshi Nakamoto’s vision. If the devs are still there, no matter if they are new devs, if the undefined community still exists, if the repository is still there, it’s bitcoin.

Appeal to emotions. A point for Carvalho.

What Ver attempted to explain, but Carvalho refused to acknowledge, was that Bitcoin Cash was closer to Satoshi Nakamoto’s original vision than bitcoin is now. That bitcoin has diverged and is heading down the wrong path. A path with higher fees, slower service and lost transactions.

It fell flat. Ver was a copycat and it stuck.

Carvalho continued his attack.

Carvalho repeated that the repository is “bitcoin” no matter how the code is edited by the core devs or contributed to, by the undefined community.

Ver indicated that not just anyone in the community can contribute to bitcoin. [So this is a false statement, Ver implied.]

Bitcoin is NOT open to the community.

Ver cited Gavin Andresen’s revocation. Andresen is no longer allowed to contribute – meaning bitcoin is NOT open to the community.

Carvalho stated that Satoshi Nakamoto did not hand bitcoin over to Gavin Andresen in the first place. That Andresen somehow obtained control over bitcoin after he went to the CIA. [Vague accusation – never explained. FUD?]

Ver stated that Carvalho was incorrect. That, not only did Nakamoto share access to bitcoin development, but Andresen then shared it with others. These others then revoked Andresen’s access, without his consent. Andresen can no longer approve code to be included into bitcoin.

Andresen a risk?

Ver also stated that the new core devs alleged that Gavin Andresen’s bitcoin dev account had been hacked and that was the reason his access had been revoked…permanently. Oddly, this, on its face, appears very suspicious and thus far this author is not aware of any evidence that Andresen’s bitcoin Github access was ever hacked. On the other hand, concerns over Andresen’s original indications that he had found the one true Satoshi Nakamoto (Craig Wright) may have played into the issue.

Carvalho stated that the new core team, which Gavin Andresen gave permission to help develop bitcoin, had been asking him to voluntarily revoke his own access, before they locked him out, because he was no longer “contributing” to the bitcoin project. That allowing Andresen continued access was a security risk.

Carvalho also stated that Andresen contributed to his own downfall by focusing on “antagonistic” things. [In other words, Andresen did not agree with the new core team members…and was unceremoniously booted out? That appears to be the implication.]

Okay. Enough. Andresen being booted out does not make bitcoin a closed community.

Point to Carvalho.

Back on focus…

Ver then tried to have Carvalho focus on the block-size debate issues, which was apparently supposed to be the focus of the interview.

Carvalho said that Ver had originally supported the Bitcoin SegWit2x fork.

Ver replied that this was true, but after the last-minute cancellation by others he went with Bitcoin Cash – and he had indicated this would happen if SegWitx2 failed. And it failed.

The accusations continued to fly from Carvalho.

Derailed again…

Carvalho indicated that Ver recently received flak for the newest Bitcoin.com wallet (Ver owns or has interest in Bitcoin.com). That the new wallet defaulted to Bitcoin Cash.

Ver stated that this was also untrue and held up his cell phone and showed Carvalho. The screen on the phone clearly showed two wallets. One for Bitcoin and another for Bitcoin Cash.

Cell Phone Wallet - Copy

(Photo Source: YouTube)

Carvalho stated that this would confuse people and implied that the names (Bitcoin and Bitcoin Cash) were too similar. That “newcomers” might not know the difference.

And I’d have to say that Carvalho is right on this point. Ver’s cell phone shows a confusing set of choices. If you don’t know the difference between BTC and BCH, then you might become confused.

Carvalho then asserted that it was fraudulent to use the bitcoin name in Bitcoin Cash. Carvalho did not explain this accusation.

Fraudulent is something obtained, done by, or involving deception, especially criminal deception.

Ver stated that he did not think the labels were that confusing [or fraudulent].

[Side Note: If you can’t tell the difference between crypto-wallets with separate labels, you should probably not be using cryptocurrency.]

Carvalho then asserted that the Bitcoin.com wallet would confuse people, implying that the name of the website was also misleading.

Ver stated that the Bitcoin.com wallet clearly states that is supports Bitcoin Core and Bitcoin Cash.

Carvalho then changed the subject. He stated that “we’re” concerned for the “noobs” due the Ver’s marketing power. That they will be confused.

Even score here. Both have valid points.

Ver countered. He asked why Carvalho was not concerned that newcomers would pay more in transaction fees ($20.00 fees) with old bitcoin?

Carvalho ignores high old bitcoin fees.

Carvalho said he wanted to talk about fees “separately.” That he was more interested in “education.”

[In other words noobs losing money in old bitcoin was not considered educational to Carvalho.]

Ver gets a point.

Once again, Ver stated that Bitcoin Cash more closely resembled the original Bitcoin.org Whitepaper.

Carvalho asked how Ver could “…make that leap” since there was “…no mention of Bitcoin Cash,” in the Whitepaper and is not any more peer to peer, than is bitcoin. [Carvalho had indicated that bitcoin was ‘node to node’ these days.]

Ver gets another point. Carvalho’s answers are too vague.

Ver explained that the fees were lower with Bitcoin Cash — again. That nobody can stop the transactions.

“…Bitcoin Cash can be stopped…”

Carvalho stated that Bitcoin Cash can be stopped since it’s a smaller network. That the only reason that transactions are cheaper, is because nobody is “spamming” Bitcoin Cash yet.

Interesting idea.

Ver asserted that this was not true. That bitcoin is now slow and expensive due to full blocks and the user experience is suffering.

Ver is on the money. Bitcoin is very slow.

Carvalho cited bitcoin’s higher market cap, but Ver stated that bitcoin has failed. That the slow transaction speed is the tell.

Bitcoin has not yet failed.

“…the Lightning Network…”

Carvalho stated that the “Lightning Network” would increase transaction speeds.

Ver responded that the transition from Bitcoin Core the Bitcoin Core assisted by the “Lightning Network” is much more difficult than to simply switch to a better coin.

Ver asked Carvalho if he had ever completed a single Lightning Network transaction and received a negative response.

Ver gets a point. There are SegWit2x problems. It’s an unproven system.

Bitcoin is bleeding out…

Ver stated that Bitcoin used to have a near 99% market share. That it is now “bleeding” into other altcoins and stands at about 53% of market share.

Carvalho disagreed and indicated that this does not mean that bitcoin is losing ground due to its value per coin.

Nobody wins this round.

Ver said that Bitcoin Core has “intentionallydestroyed bitcoin’s usability by capping the block-size. It’s too expensive to use, less reliable; and therefore, investors are seeking out alternatives.

Block size?

Carvalho stated that Satoshi Nakamoto designed the small block-size in the first place.

Ver stated that Nakamoto was convinced by others to do this later, as a temporary measure, to stop others from “flooding” the network.

Carvalho tried to change the subject again, but Ver asked him to finish each subject before moving on.

Ver then advised that Nakamoto’s original intent was to allow the block-sizes to be as big as they needed to be, to accommodate the network.

Carvalho then stated that the bitcoin block-size was in fact limited from the beginning.

Ver did not answer this question clearly. Ver stated that the block-size (what was stored in each block) grew as time passed [until it apparently hit the actual preset limit].

Even score again. Nobody wins this point.

Why does Carvalho like old bitcoin?

Ver then asked why Carvalho liked bitcoin and he responded with the standard line. No inflation, private, decentralized, store of value etc.

Ver then indicated that Carvalho’s answers defined many altcoins in general.

Then Ver advised he was trying to replace all forms of money with a form of permission-less money and make it impossible for governments to control money and free trade.

Carvalho hit on the decentralization aspect again, but Ver stated the this is a tool of censorship resistance, not necessarily a goal in and of itself. That censorship does take place in bitcoin when your transaction is too small, and it drops from the “mempool.”

Carvalho cited blockchain rollbacks by miners with more power. This “power” centralization has effectively censored transactions.

Ver countered that the small bitcoin block-sizes incentivizes investors to use large “bitcoin” banks like Coinbase. Such a concentration of bitcoin is akin to “centralizing.” If the block-size is larger, the system is easier to use and keep in investors’ hands.

Carvalho tried to state that the altcoin exchanges are a centralization risk, but Ver reminded him that it was a matter of choice to trade on exchanges.

Mix and match. Nobody wins these points.

Untested Tech

Carvalho then advised that his company (Xotika.TV) now uses SegWit2x.

Ver implied that it is an untested tech and that there does not have to be a block-size limit anyway.

Ver wins this point.

Carvalho moves onto theory. There is “infinite demand for block-space.”

Ver disagreed. He said it depends upon the demand that the miner’s set for the block-space.

Ver’s point.

Then Carvalho played the “what if” game.

What if the blocks were infinite?

[Yet another seemingly ridiculous argument. Carvalho is not apparently grounded in economic reality, but mired in some infinite theoretical worry. At this point Carvalho becomes defensive as it has become obvious he is losing the debate.  Accusations begin to fly. Ver doesn’t actually know what he says, etc.]

Ver stated that nobody knows what the perfect block-size is.

Carvalho: not knowing then [the optimum block-size], what is the best approach? A conservative one or a risky one?

Carvalho’s lack of knowledge shows…

Ver stated that the market should decide. Then he asked Carvalho to name any other altcoin that has full blocks [like bitcoin].

Carvalho didn’t know.

Ver stated that it has never happened.

Ver wins point on technicality.

Carvalho indicated that everybody wants to use bitcoin. [Yet another wild assertion. Bad form.]

Ver related that bitcoin having full blocks and high fees – and being experimented upon – is VERY risky. That the experiments should be done on a separate altcoin, not bitcoin. [Really good point.]

Ver wins two-points.

Carvalho’s do nothing approach

Carvalho stated that “inaction” on bitcoin is “conservative.” That leaving it alone is not risky. That Ver should not paint it this way.

Ver stated that action is needed on bitcoin.

Ver wins point again.

Carvalho repeated that bitcoin had a coded-in block size limit originally, but Ver explained that this was not generally true. That the one-megabyte limit was not reached until recently, since there was no “infinite” demand for block-space. At that point any responsible core team should have fixed it. Such a failure, in the real world of business, would have resulted in an employee’s termination, according to Ver.

Ver’s explanation agains fall flat. Minus a point.

Ver stated that many well-known exchanges are busily integrating Bitcoin Cash, but if people still wished to use bitcoin, that is fine. On the other hand, if you want reliability, faster transactions, something like the way bitcoin was supposed to work, then Bitcoin Cash is the answer – and it will save you money.

This comes off as smug. You are losing the crowd here, Ver.

Carvalho asserts…again

Carvalho asserted that Bitcoin Cash was unreliable. He asked why Bitcoin Cash created more coins and raised the specter of inflation?

Ver stated that Bitcoin Cash has the same coin number as bitcoin, but for a time, many miners switched to Bitcoin Cash and they got ahead.

Point for Ver.

Carvalho then supplied a list of Bitcoin Cash complaints all at once. He continued to interrupt Ver.

Carvalho indicated that Bitcoin Cash changed their mining algorithm to make it easier to mine.

Point for Carvalho. Ver never counters.

That ASIC Boost can also be used.

Point for Carvalho. Ver ignores or forgets?

That there is almost a 1% inflation rate in Bitcoin Cash.

[This inflation assertion is disingenuous. Inflation implies a constantly growing money supply. Bitcoin Cash, like bitcoin, has an upper hard limit. Carvalho’s argument is that since Bitcoin Cash mines faster it causes temporary inflation of coins – but this does not necessarily translate into a lower coin value, which is the result of inflation in a controlled, single-source and mandated money supply. Bitcoin Cash is not “legal tender.”]

Carvalho’s inflation allegation falls flat. Minus a point.

Carvalho also alleged that “old work” can be used to obtain more Bitcoin Cash coins in some cases. No other explanation was given.

Ver does not counter. Carvalho wins point by default.

Ver claimed that given the current bitcoin environment, bitcoin will lose out to Bitcoin Cash.

Vague.

Carvalho indicated that Ver stated these things because he thinks that Bitcoin Cash is doing something new.

Ver said that Bitcoin Cash has a larger user base that litecoin, for example. That anyone can check Coinmarketcap.com to see this.

Carvalho responded that using trading volumes, where there are no fees, for example, does not give an accurate picture. But he failed to describe what did give an accurate picture.

Nobody wins a point.

Carvalho plays dirty…

Carvalho then accused Ver of over-tweeting, getting socks (sock puppets) to up-vote and downvote etc.

Carvalho loses credibility all at once. Dumps all his points. Irrational statements. No verification offered.

Ver stated that these were lies. And backs his statements up with examples.

Ver is awarded five points.

Carvalho offered zero evidence of these accusations or any others, up to this point. And yet he presses on.

Minus another point for Carvalho, who is now sinking.

Carvalho then launched into more insult-like behavior, called Bitcoin Cash, “Bcash” and Ver became irritated. He advised Carvalho to discontinue this line or he would discontinue the interview.

Since Carvalho senses he’s lost the high ground, he starts to sling.

Minus more points.

Carvalho continued to press Ver’s buttons, stating that Ver only wanted the bitcoin name to “…coopt the brand.”

Ver stated that it was essentially more legitimate than bitcoin, although the name is Bitcoin Cash. But it is the true “bitcoin.” Read his lips, Ver stated.

The discussion is off track now.

Ver began to cite the growth of Bitcoin Cash over bitcoin, pointing out that it will soon overtake bitcoin.

Bravado?

Carvalho’s belief — higher bitcoins fees are better?

Carvalho stated that the higher fees associated with bitcoin makes it more valuable. [Seriously.] That for Ver to continue to hold bitcoin at all “…makes no sense.”

Ver reminded Carvalho not to place all his eggs in one basket and that bitcoin still retains a “network effect.”

Ver creams Carvalho again.

Carvalho continued with his “Bcash” insults and Ver reminded him it’s Bitcoin Cash. Ver also indicated that he does not need to speak to “someone on the internet” who does not necessarily run a successful business.

This makes Ver look bad. Loses emotional high-ground here. Big bad Bitcoin Cash entrepreneur bad mouths porn king, just trying to make a smut-buck. We’re in the ditch now.

Carvalho asked why it mattered that Ver was a millionaire.

[Why? Because it shows a person who can run a successful business.]

Carvalho reminded Ver that bitcoin is not a business.

Ten points for Carvalho. He’s above water again.

Carvalho insisted repeatedly that he could call Bitcoin cash, “Bcash” and Ver reminded him that that label was started in a derogatory manner on the internet and that he didn’t like it.

Moot point. Does not help discussion. It just pushes Ver over the edge.

Carvalho’s last stab…

Carvalho stated that he thought only Ver, “Jihan” and Ver’s sock puppets, didn’t like the “Bcash” label.

Ver then discontinued the interview after flipping Carvalho off.

Bad form. Ver loses debate in seconds — on emotional grounds, but not substance. Makes him appear easy to enrage.

I’ll have to say, of all the interviews I’ve seen Ver do, this one was the most interesting. Showed his human side. His inabilities.

And if Ver is right, it will be an “I told you so moment” when (and if) bitcoin begins to falter. Whether Bitcoin Cash will pick up the slack, is another matter.

Do you still trust Bitcoin Cash?

Conclusion:

Carvalho’s interview only served to point out bitcoin’s weaknesses, show that Ver is human and make people realize that they might want to reconsider holding onto BTC or BCH.

On the other hand, Carvalho made some valid points, even if most of it was mud-slinging.

Put your eggs in different baskets.

Ver issued his apology here. Too late now.

Sincerely,

 

Jack Shorebird


…I am now rethinking my Bitcoin Cash holdings.

Feathercoin: Chicken or Golden Egg?

Feathercoin: Chicken or Golden Egg?

Dear Crypto-Enthusiasts:

I came across it quite by accident…again.

No, not a particular crypto, but something that led me there, quite by accident.

Some people say the strangest things…

And you don’t find those things in classrooms or in books as often as you’d like. Magazines are filtered niceties. News alerts, groomed and stylish. Substance takes the side exit, in the politically-edited world.

You find these snippets scattered on this thing called the internet. In videos and blogs, where guys and gals argue on some other guy’s YouTube Channel. On Reddit, where kids bash adults and jokesters have their way.

Despite it all and perhaps because of it all, the good cream rises, then dissolves. You can always tell when someone is pushing coin and how others (myself included) make mention of certain cryptos that have come into focus of late. I don’t like to push.

Here’s an example of fantasy shoving…

…mycelial network?

Bitcoin and crypto, in general, are a mycelial network(s). Nature’s internet, long ago fastened to the reality of need. Huh?

Little blurbs of genuine hype like this are common.

Mycelial Networks. Living things compared to crypto-networks. From Wikipedia – “the vegetative part of a fungus or fungus-like bacterial colony, consisting of a mass of branching, thread-like hyphae.”

I get the picture. It’s not a bad analogy, if a weak one.

Although, crypto is not a single entity – even bitcoin’s ledgers run on various “machines” – the neural-like network is ubiquitous. It is homogeneous, but not self-sustaining. Bitcoin requires you and me to “make” it function. It’s the opposite of a fungal root system, that grows to absorb its nutrients.

It’s as good an explanation as any, however. Bitcoin – crypto – is usually a network. An energy-network between computers. But it is also dependent, like the lowly mycelium, upon its environment. It must take from its surroundings to live.

We are networks too. Our bodies and brains. We eat and walk and procreate. We use our environment.

But bitcoin is not alive.

Chemical or electrical, a network is a network. And I’m not on about the fabulous nature and redundancies of networks. They work, unless all hell breaks loose. The bigger, the stronger.

But living things – networks — have their weaknesses. One good virus and goodbye network. Redundancies or not.

Electrical networks – digital networks – are far more resilient. Usually.

Thus far, few crypto-networks have failed, aside from forks and 51% attacks. Once bitten, however, the end users often suffer the trust-bug. No longer will they provide energy to that network.


Peercoin

The network may live for years in a subdued state, like Peercoin, but left without new code and new blood, networks die off. At least you think they would. Some mature and stabilize. They become good for short term crypto-storage. Then entropy rages.

I never thought Peercoin would last as long as it has. They had problems early on. I lost money in one of their unplanned forks. Then the main devs pressed on. Created other complimentary coins. None of the relation has had significant success, but I’m relatively sure the devs have reaped the rewards.

Is that not the play? If you do not at first succeed and all that. Or is it something more sinister? Are we simply watching money vacuums in action?

“Come one, come all – today we have a special! Today, we announce (almost – we need some start-up money, hence the ICO) a 4th Gen crypto! It’ll send your cryptos in under five seconds, confirm in under a minute and you can mine it with solar energy! How’s that for green?”

Then there are the bedrock coins. Never quite here, but never quite dead. Not zombie coins, but pregnant ones?


Feathercoin

Some few older cryptocurrencies like Feathercoin, one of the longer standing coins, seem resilient. Not overly obtrusive, not all that exciting, but under the covers. They have made significant changes since I last looked.

Interesting? Maybe or maybe not.

Looking back, I wonder why, other than its plain vanilla feel, Feathercoin has yet to realize the pumps we have seen with the other cryptos. It has never reclaimed its earlier records, choosing instead to meander in the lows, until 2017.

After two years of relative slumber, like many cryptos, Feathercoin seems to be waking. Or is it that the people are awakening?

There are also Google Trends showing recent Feathercoin interest spikes. In the crypto scheme of things; however, they are not seemingly relevant.

Why do I mention cryptos, like Feathercoin? Because, after reading The Two Bit Idiot’s latest piece I’m left wondering if the general public will get a very bad “bitcoin” taste in their mouths. So much bickering.

Two Bit is on about Bitcoin Cash (BCH or whatever). And I’ve always respected his views. He gets into so many angles, though – and that helps one respect the research – it leaves me a bit sick. Holding or HODL? BTC or BCH?

To hell with it all, I sometimes think. Let me hope for the best with Lending Club.

And yes, we’ve all seen BTC rise and rise. We’ve all noted when big boy tanks, the girls (and guys) scream and nearly all of the other coins sprint for the doors. They cash out or Tether up. But that plays seems less of a bother these days.

These days, some few cryptos hold their candle wax, as BTC burns. Is this the handwriting? A psychological shift?

In any event, unless you think that one of the bitcoin brothers will hitch its star to Jihan Wu, who if memory serves, advised that people will follow the pack. I submit that packs, like pure democracies or autocratic empires, eventually crumble.

People are fickle, Mr. Wu. Trust is difficult to maintain when one has large businesses within China. A country not known for treating its subjects fairly.

Aside from all the battles and concerns about bitcoin, bitcoin cash, bitcoin gold and so on – there is the other angle to look at: profit. People, in this fintech space are not after trade, as much as profit. Profit seems to be the dirty little word, however. But let’s admit it. Don’t you want to profit on your investment in crypto?

Using that yardstick, do you hope one of the bitcoins (not cryptocurrency in general) will double, triple or quadruple in value? Sure, you do.

On the other hand, do you scan the other cryptos looking for more leverage? Seeking that short and explosive coin to jump start your investment? Maybe you won’t hold it, just use it, right? Then park your profits in BTC or maybe LTC or maybe somewhere else…

And it’s the somewhere else that will begin to chip away at the mountain that is bitcoin. It’s been happening for the last few years anyway.

And how do we decide what will be the most profitable investment in crypto? I find no experts. Some of the chart reader types seem to get close, on occasion. But some have insinuated that “over heated” crypto-markets are bubbly.


Electroneum

And the hunt for adoption is ever the noble journey. Electroneum seeks this high ground and maybe, in time, investors will reap the rewards. Certainly, utility must charge the profit meter. How can it not?

Compare utility to bitcoin. Is it not speculative in nature? Does one not want to accumulate, rather than spend? And is not the spending of bitcoin becoming prohibitively expensive?

Sure, there were gold hoarders in the past, but the gold’s utility as actual money maintained its power to purchase. When gold was legal tender, one was not charged for the privilege of using it, but storing it was often fee based.

My point is, things like legal tender gold and silver coins had a utility value multiplier, when used as money, as well as stored for savings. Since bitcoin and crypto are unstable, the risk reward for any long-term investment is dubious at best.


Attributes:

Here are a few of the attributes recommended by the gurus of ‘coin and ones I’ve come up with over the years. By no means is this the all-inclusive list. Plenty of cryptos have soared and are doing quite well using different methodologies.

  • High-speed transactions
  • Ability to secure personal data (privacy)
  • Limited virtual supply
  • Trusted by its users (maybe not an ICO)
  • May or may not be centralized
  • Bottom-up focus
  • Longevity
  • Customer Service/Communication
  • Core or primary services located in freer countries
  • Dev/founder philosophy

And don’t get all hung up in longevity. Just because a coin is old, does not mean it’s the same. Often, past forks, like what occurred with Feathercoin, offer new and better code, but also end up with new headaches. If the team remains, that’s a big tell.


Final Notes:

Moving back to Electroneum (one coin I’m watching lately) – it uses the CryptoNote codebase. A well-known, but sometimes problematic system which Monero has improved. In other words, the code can be well-tested (trusted) long before someone picks it up and takes it down a new path.

Finally, you may have come across the RuffCT concerns that could slow Monero down. Better at privacy, but less efficient, could spell disaster, unless coders find a better solution. How Electroneum will feel about such a modification, if they update to it, could put them in the same boat.

Meanwhile, I wonder if Feathercoin will lay some nice little eggs after all these years…

 

Sincerely,

 

Jack Shorebird


The above is not investment advice. Seek appropriate gurus for that.

 

Cryptocurrency: “…and Bitcoin Must Burn!”

Cryptocurrency: “…and Bitcoin Must Burn!”

Dear Crypto-fans,

The crypto-fake-fintech-news continues, but the tide is turning in some few lands. Slovenia maybe. Singapore, possibly. Nigeria? Yes. But I won’t be emigrating.

Google trends are showing an upswing of late.

But the battle against cryptocurrency is also gaining momentum. The reaction is fomenting. Like Cato the Elder’s call for Carthage to burn, so too are the princes of the day signaling their intent, through their mouthpieces on retainer, that non-princely crypto, must also be destroyed.

The most recent pretext to dump bitcoin and cryptocurrency, besides bubble fears, is that fiat currency is “backed” by the government or the Central Bank. That such a thing as cryptocurrency, which does not enjoy the toxic fruits of the government fiat monopoly, is intolerable and hopeless.

But this assertion is ominous, not glorious. Whether you believe Clif High, that Bitcoin will far outpace the value of gold or you want to take to the shadows with your secret Bytecoin, the princes are on the march. They care not if you chose Cardano (ADA), but might let up, if you wade into Ripple (XRP).

And we cannot reach into our television sets, our computer monitors, our tablets or cell phones, and shake these intellectual Lilliputians by the shoulders and yell, “Hey, Brainiacs, fiat money is also NOT backed – except by a gun.”

“How dare you think that, you finite fleshpots.”

That’s how they respond, in my translation. Shake their ponytails, peer side-long down red veined noses, lick their finely wine-soaked lips, point to the proper ends of their overcooked eggs, with bejeweled digits, and leer at us subjugated subjects – with the aplomb of the imagined royal birthright.

Two such peers of servitude deserve mention.

“Alan Greenspan…Jamie Dimon…”

Alan Greenspan? A former gold bug, now completely in tune with the Fed or is that the vampiric feeding of inflated monetary dogma?

Jamie Dimon? A bankster in the Morgan mold or is he a dollar-defender, through hell and devalue?

Here are a few more bitcoin bashers to peruse.

Deep thinkers of the bygone epoch, where it is said that monetary conscription is better than gold-backs. Where the song of sound money, as sublime and powerful as it is, cannot meet the rejoinder – the princely power of the purse, under guard.

What do these bashers of bitcoin really mean when they say that cryptocurrency is not “backed” by Johnny Law? They mean, dear readers, that the prince is not in charge of the peoples’ currency, i.e., cryptocurrency.

And that is the crux of it. THE PRINCE HAS NO CONTROL. Paupers must mind their prince.

The prince’s fiat money is “backed” by his soldiers. You must use it – or else.

Think on that, each time you pull that fiat from your wallet with that picture of the current or past princes. This currency is “backed” by the point of a gun, the threat of jail if you refuse to use it, or large fines if you dare to abuse it. It is called forced compliance.

The Federal Reserve Note, is your contract with the prince. Do no fail to abide by the terms.

Has not humankind outgrown such princely designs?

The religion of money…

Most currency, that plastic card, paper or digital noise stored at your bank or under that rock in your yard, is worthless-worth. It is backed by nothing and the power to “make it work.” A promise to pay zero and from that zero, substance. The religion of money, if you will. To make nothing buy something. Just believe, sayeth the Prince of Fiat.

Every school child should know this. Government fiat is “myth money.” Fantasy cash, you are compelled to use.

The soldier “backs” your princely fiat these days. Except, to him, you are the enemy. Harsh words, but relevant when comparisons must be made with cryptocurrency.

Fiat crypto, by comparison, is an all-volunteer army. In this scenario of sin, the prince of fiat is dead.

And about the noble metals. There are no gold bars at the bank – in most cases. Even the Swiss have denuded their banks of metal. But the Swiss people, being a lot more intelligent than their host of princes, have stored gold in private vaults – not banks. Unfortunately, the princes are aware of the locations of such vaults.

But who owns that gold? You think American and Japanese billionaires don’t have a dog in that fight? Sure, they do. Will a Swiss Army man care to back your Swiss stored gold, if his prince reclaims the bars, for the good of Switzerland?

And private vaults abound these days. Do you wonder why? And are these vaults safe from the princes’ soldiers?

…myth money…

Cryptocurrency is also a myth money, a fiat currency, but it is different too. The prince does not own the cryptocurrency fiat money machine. The people own crypto. It is a detached system of fiat currency that circumvents capital controls, i.e., the Prince’s Rules of Trade. And there are dozens of competing blockchain alternatives, not simply one princely fiat system.

The prince is fuming about this. How dare his subjects create their own fiat currency. Don’t they know that fiat money is backed by nothing – not even the princes’ soldiers?

You might wonder how a cryptocurrency system can invade and dislodge, peaceably, the Prince’s Bank and essentially rob him of his ability to conduct business. You might also wonder what the prince is going to do when his fiat currency begins to devalue so rapidly that he can no longer pay his castle employees the proper level of wages.

He will need to pay his soldiers some how and maintain his dominance.

Will the prince seek to control all the cryptocurrencies on earth? No, he does not have that power.

Could our Prince enlist the help of other princes abroad, hold a summit in a foreign land and gather the forces of many other princes and kings, to block this crypto-virus from spreading?

Maybe. He and his soldiers, who he pays in Bright Prince Fiats, must team up with other lands to thwart this growing threat, before it’s too late.

…a gold standard…

In the meantime, some gold-bug few of the Prince’s own citizens, wealthy masters in their own right, the ones who have decried his use of fiats for years, call for a gold standard once again – and for the abolition of crypto, henceforth.

The prince, seeing a way out of the crypto-crisis begins to devise his plan.

The renewed gold standard is enacted, sort of.

The prince has all the land gather their hoards of silver and gold, deposit them into the banks he controls and promises his subjects, that from this day forward, sound money will reign supreme in all his lands.

The prince’s subjects, save a few wary ones, deposit their golden hoards, which they have hidden from the princes of past and present, into the princely vaults. Record amounts of gold, silver and diamonds, flood in and the subjects are ecstatic.

Even the prince smiles, benevolently praising his lands. “For the good of my subjects!” he laments. He feigns emotions at just the right moments, as his advisors have advised.

The subjects of the lands, relieved of the dual threat of the crypto-virus and the prince’s own fiat money scourge, forgive the latter and bash the former with abandon.

Pronouncements echo and postings are posted all over the lands. Town criers cry. On every tree and jailhouse wall, flapping in the breezes, are the grand and memorable memoranda: sound money is the order of the new day.

Of course, our Prince, along with all the other princes and kings; and not a few queens of dubious nature, have simply activated their plan to cast a shadow of disrespect over the whole of crypto.

“You see,” the prince quips, as he lounges on great pillows, attended to by subjects knowledgeable in the ways of arcane finance, “crypto is fiat…and princely sums are sound money – backed by gold and silver! I have returned to the ways of old gold!”

But the plans these of princes is most certainly a mirage. They, the princes and kings, the dubious queens and tyrannical tricksters, have merely confiscated the gold and issued multitudes of fiat. They have also declined to report the exact amounts of gold and silver in their safe-haven bank vaults, under their control and properly guarded by soldiers of the crown, by and for the good of all subjects, of course.

“Security,” says the prince, “is of vast and secret importance! Therefore, for the good of all subjects, I will keep the location and amount of princely precious metals undisclosed.”

…gold and silver and jewels…

What’s more, the prince, seeing to the secret security of all this gold and silver and jewels, has it moved from the banks and consolidated at his Summer Palace. A palace which is really a fortress far from his subjects and heavily guarded by loyal soldiers, who are paid in actual gold.

Princely subjects, fighting for the flag, dying for honor and dust, must dine, once again, upon the quantitative ease. No more are they worth, no less should they breathe.

Do you see any parallels here? This is essentially the repeating history of money. The Classical Liberal societies start with gold/silver monies then they devolve into socialistic fiefdoms and fiat systems controlled by the prince. A prince, who requires all your private information, to keep you safe from the wanton criminals and be able to reallocate your accumulated wealth as you live; and upon your demise, absorb your gold – all for the good of the prince’s subjects – meaning us, whether we like it or not.

And you wonder why the subjects currently trust fiat cryptocurrency over gold – for now.

The subjects – paupersdo not trust the prince.

Perhaps one should look at this trend. Bitcoin is gathering more interest than silver or the dollar. That’s an eye opener.

When do you suppose the interest in bitcoin will surpass gold? And does it have staying power?


Sincerely,

 

Your Friend in Crypto…

Jack Shorebird


Disclaimer: Believe none of what you read herein, half of what you see, and bow to the prince every night, before your subject-slumber, if you think that I’m not serious…

Cryptocurrency: Dreams in a Bottle or a Bubble?

Cryptocurrency: Dreams in a Bottle or a Bubble?

Dear Cryptocurrency and Freedom Lovers of Earth:

We are just dreamers waiting for the big bad bubble. Lean over and kiss your bitcoins goodbye.


Bubble Trouble

Cryptocurrency is a bubble.

It’s the 2.0 try-outs, since we didn’t believe them the first thousand times.

We love Ponzi, they insinuate. We probably initiate chain-emails in our sleep, insert cryptocurrency miners on your webpages, and dream of pyramid schemes…as we pay our extremely reasonable .gov taxes.

Cardano (ADA) will surely explode.

Monero (XMR) will implode.

Electroneum (ETN) will evaporate.

Ethereum (ETH) will wither smartly, and die.

Cheaters and meanies are hiding in the dark corners of those ICO-laced cryptocurrencies.

Bad people, the lot of them.

Run back to gold?

“Hey! But we love the blockchains! Just not the ‘people’ running them.

“You see, us banks and .govs – we do a much better job popping fiat bubbles. We just go around, blowing them up, making you go broke and then we do it all over again!

“And us metallic mega-hoarders, well, we can dig it too! And hopefully, one day in the far-flung future, gold will become what it once was: money. And then us mega-hoarders will win the day. We will say, on that day, if that day ever comes again that — we told you so!

“We can’t wait. It’ll happen soon, we promise!”

At least some of the gold bugs are on board the crypto-train. Guys like Mike Maloney. He’s a forward thinker, unlike others…

The lesser numismatic gods, the ones still hoping to influence President Donald Trump – to take the US back to gold – are instead bashing away at crypto. Maybe they don’t realize that they are, at the same time, bashing away at liberty itself. Not such a brilliant tactic as it is a calculated risk.

“Tell these Millennial dolts that cryptocurrency not stamped IN GOD WE TRUST and FEDERAL RESERVE NOTE is NOT money. Jeez, the humanity of it all. Tell them gold is the answer – immediately.”

Is that the general feeling you get from some of the golden metal-heads? The ones who warn of crypto-bubbles and hope for altcoin death, in situ.

And the best gold bugs? The proud Sharia Law complaint versions of them? “Oh Canada!” they sing aloud on their days off, from those frozen roof tops.

I take you now, dear reader to the halls of GoldMoney. In Canada. There, the money (no not money yet) is GOLD! Actually, the company was called Bitgold before that, but cited regulatory problems and low demand, before shutting down.

These golden folks have allowed to be posted on their website (and I’m almost certain it will be taken down like another YouTube video that fled in haste — business is war, right?) are the illustrious words of one Bubble Attacker: Alasdair Macleod. For shame. (My opinion.)

Macleod is an apparent researcher for the company in question, hence not the best disinterested party, right? A mouthpiece? Hmmm.

Then there is a far more corrupt banking industry to consider. Finance houses practicing insider trading. A Fed that feeds the US with worthless notes. Just read the headlines. Wells Fargo. JPMorgan Chase. Bank of America. Quantitative Easing. (Not an opinion. Facts.)

Need I say more? Aren’t you sick enough yet?

It’s not the banks or the .govs this time, however. It’s gold. Or more precisely, a troubled offshoot of gold bullion pushers surveying the crypto-landscape and taking careful aim.

 

Crypto Kills Fiat

To talk of cryptocurrency bubbles that will occur and describe them as a dire menace to .gov fiat is pandering to the .govs of the world. Gold money is a far worse threat to the .gov machinery and they – the bullion dealers — know it.

If people were actually allowed to use gold, silver, copper – as money – the Fed would close its doors and the Military-Industrial Behemoth would most definitely become rather irritated, if not hungry.

The .govs would need to finance themselves with real money then. No longer could they pass on the costs via inflation taxation. They would need to beg, borrow or steal the gold – again – from their subjects.

And that is always a problem, isn’t it? Gold theft?

And why can’t some companies see that? Especially ones in North America? Don’t they understand that before gold can become money again – that the entire centrally planned economic model must be dismantled? That laws must protect the people from their .gov?

It appears that Our Golden Savior of Canada is sounding that alarm, however. Or at least helping to ring a few bells to scare the cryptocurrency birds away. Darned pesky eagles just won’t die. They want to fly at any cost, even if it means creating their own crypto-fiat money in a world gone money-subservient.

It’s also a way of diverting attention – heat – from them. And a way to “sell more gold!” Soon they might begin knocking on our doors. Or you’ll see them at flea markets, not buying gold, but selling it!

Congratulations bullion traders of the Great White Socialistic North. Not that the US is that far behind either, but strike while the bubble is hot! And the bubble attack is ongoing.

But we need new material, not tired old rinse-and-repeats.

It reminds me of Chicken Little when he yelled, “the sky is falling!”

I’ll call them, those Gold Money guys and gals, Our Golden Savior. The bell ringers, who are losing investors to cryptocurrency. And who only want to make sure you and I aren’t being swindled, right?

After all, gold is money. No, it’s not. Not yet anyway.

 

The Warning

One Macleodian article on their website (and also here) talks to us about bubbles. But this does not irritate me as much as the Canadian based Sharia Law Compliant company does.

I mean, gold and precious metals are no doubt great value keepers, but dear fellas, we do not live in a golden age. I swear. I just called my bank. They said that they can arrange to store any gold I might wish to purchase; however, I can’t use it as money. (No thanks.)

You can’t spend it, your gold – in the US – like money. The IRS wants an accounting of each transaction. Just like cryptocurrency.

We live in a fiat-currency age – in the US. We are jammed in tight. Well, there is one out. It’s called cryptocurrency.

Gold is taxed as property in the US, which makes it terrible to use as money – even debit card based. I believe Peter Schiff advised this long ago, but now – he has joined them. And now…these facts seem to have drifted away. Little tax bombs ready to go off in April, when you have that “awe shucks” 1040 moment.

Don’t get me wrong, I would rather use precious metals, as money. I’d love to have a sound money system, but this fiat thing is just going to have to burn itself out first. Venezuela style. A little Greek fire, as it were.

The article in question asserts that gold is on the minds of many. Granted. Any form of sound money ought to be. If gold was money today it would be on everyone’s mind. Well, most everyone. Some actually like the fiat money system and socialist governments.

The write-up also warns, yet again, about the pure and shiny new bubble. The cryptocurrency bubble that is sure to burst – someday.

The problem is the golden .gov wall, however. We are all looking at that wall and asking ourselves the same questions.

Is there an alternative to gold, since I can’t spend it like cash?

Should I buy a few pieces of a precious metal and store it myself or should I use a gold bullion dealer in Canada? A dealer with gold all over the world in nice vaults – all on the ‘up and up’ – but far away…?

 

Crypto is NOT Money?

The primary debate against cryptocurrency, that it is not money, ought to be jettisoned.

We know this. We know it is not money.

Gold can be money, but it’s not either. It’s just gold, for now.

Cryptocurrency is more closely related to a functional currency or a service money, but it is a form of fiat currency as well. But a far superior fiat currency, for many reasons. And rather crappy, as well.

That’s what we are living with. We can use cryptocurrency, with all the associated risks or we can obey. Now do you understand?

Why did people risk their lives to come across the oceans in hopes of a better life? By comparison, this rather low-key way of transferring wealth is lame by comparison. It’s an exercise in freedom, however frail. The thing is, the .govs need to crush it in order to stop the virtual and peaceful sit-in.

 

A Bridge to Sound Money

Cryptocurrency is a bridge. It is a way back to sound money over the river of .gov fiat systems currently in place. It is the bank waiting to store the gold, so to speak. Only, the .govs stand in the way, so there is an impasse.

Who will blink?

How could crypto bridge to gold?

View it as a check or a contract.  A voluntarily enforceable one for now, but one that would easily fit in as a legally binding instrument against a rare commodity, such as a precious metal. Banks could accept cryptos in exchange for silver coins in some enlightened future. That ‘backing’ would likely stabilize cryptocurrency values.

The problem is that precious metals are currently locked out of legal tender status. The same can be said of cryptocurrency, except it has many other advantages neither fiat money or gold has – at present.

A gold bullion dealer is no less vulnerable to .gov regulations, than are most public cryptocurrencies. There are more private cryptocurrencies, however.

 

Privacy

And that brings up the idea of privacy. The love-child of cryptography and blockchain services.

Unlike the bullion company in question, where I need to give my name, address, income, photograph, ad infinitum – let them dig into my personal life – I don’t need to do that with many cryptocurrencies. Not with CryptoNote versions; and I can find ways around those exchanges now asking for my goods, as well.

The argument that the cryptocurrency companies, promote their own coin – buy in, pump it up – is a given. This is also true across the spectrum of stocks and bonds, in the restricted .gov regulated trading houses – where the brokers take their cuts and fees; and slice the pie more often than the average cryptocurrency exchange. All at the pleasure of .gov.

 

Early Adopters

Certainly, early adopters could make the most profits in a cryptocurrency economy. Ground floor opportunities have that potential, but this does not validate that a bubble is on its way. This is unlike the fiat cash flowing into the stock market and extinguishing any semblance of a P/E Ratio.

The obvious measure that bitcoin, for example, is a self-verifying property mechanism, is difficult to ignore. The limited virtual supply of bitcoin can drive its price. It’s ability to maneuver unhampered is juxtaposed with the .govs’ desire to bring it to heel. There is no P/E Ratio here. It’s absorption of one unstable fiat by a stable one.

Can that be said of our bullion buddies? Not the ones who sell us gold and silver and we stash it elsewhere, but the one in question. The one that essentially keeps our metal safely locked away where we will never see it and where any wayward .gov can grab it.

You call that safety? Try and grab my fiat crypto. Go ahead.

How did that work out for you?

It didn’t, huh?

 

The Undermine

And the fact that cryptocurrency can “undermine” capital controls is not a weakness. Money, ultimately, should be private. Taxes, ultimately, should be voluntary.

Did you not read the word “controls?” Who is doing the controlling and why? By what right?

Why must I send my cash via banks, be over-charged, wait days, when I can zip crypto to my Aunt in South America in seconds and do it much cheaper?

Hence, cryptocurrency is pro-freedom, whereas the company under scrutiny is compliant. But it must be, right? It has chosen the obedient path.

And fiat currency issued by .gov, is, of course, fiscal subservience.

If allowed to go mainstream, those cryptocurrencies that wish to comply with the long list of rules and fees, could certainly see radical value booms and busts. Obedience will have its profits.  After this alleged legal adoption, when the investment houses flood in, the public will take notice, as the assertion goes. The bubble will come as a result.

 

Pre-Bubble

So, the article in question makes the assumption that the .govs will eventually acquiesce to the public cryptocurrencies. Ones like traceable Bitcoin, Litecoin or Cardano. Then it all goes pop!

Why are the bubblers so certain? Past comparisons?

The South Sea bubble, where corruption was rampant? Government granted monopolies are not comparable to voluntarily purchased, transparent cryptocurrencies.

The Tulip Mania bubble is often cited, but the fact that much of Europe was debasing their currency at the time, is not often explored. Interesting parallels, but tulips aren’t cryptos.

Additionally, since many CryptoNote based cryptocurrencies are not designed with regulations in mind, this bubble warning only seems to apply to the public blockchains, like bitcoin and family.

According to the assumptions in the article, this future flood of bubble wealth into public cryptocurrencies will also cause prices to rise. Another dire warning.

That’s the static world view. In other words, more money into crypto equals more spending, equals less goods available, equals higher prices.

The problem is, when demand increases, in a free trade economy, the supply is often increased, and everyone wins. Prices often come down, in such economies.

This static theory of rising prices also ignores non-spenders. Some will save and not spend.

 

Choking

Yet another bubble warning is the “choke-off fable.”

Once and if .gov fiat currencies begin to falter, interest rates will be raised to entice crypto-investors away.

One problem with that scenario is rising interest rates slows the economy and could explode the debt and pop the fiat bubble all the faster.

Another? That crypto holds far more promise of profit than bank certificates.

If .gov could lure the crypto enthusiasts away from their chosen altcoins; however, what would stop them from also confiscating all the gold? After all, gold does compete with fiat currency and it makes fiat devaluation clear. An embarrassment to be certain, but one that can be easily remedied with an official announcement of fiat currency to gold conversion. It’s happened in the US before. Quite a choke I would say.

And we are only talking about the US here. There would need to be an international effort to quash crypto. Raise interest rates all over. And suffer the consequences.

A credit crisis would be the least of our problems then. Fiat currency would falter and I’d posit that cryptos, absent a move to a sound money standard (gold) by .govs — would maintain their purchasing power, so long as .gov didn’t zap the internet. Then we’d need to use stored reserves (gold/silver), eggs, canned goods and wine.

 

Conclusion:

The upside is that gold is real money, but it is not legal tender. Until then, it appears rather sluggish.

To state that private cryptocurrency is a threat to .gov fiats, that they could hasten their demise, is a bit disingenuous. Fiat currency is a threat to all of us already. If crypto hastens its demise, so be it.

The company in question is no less a threat and perhaps even more dangerous to investors, when one considers all the precious metals under their private control and the ability of any one .gov to remove said stores on a whim – or a “trumped up” national emergency.

In short, to return to a precious metal standard will require new laws in the US and elsewhere. It will require the closure of the US Federal Reserve, unless they begin to issue gold backed currency. It will then open the doors for competition between banks, with real money in their vaults. Money that should also be in your country of residence and not Dubai, Toronto, or Hong Kong.

Until then I’ll risk a crypto-bubble and pass on the debit card of gold, from the company in question. While waiting for the laws to embrace sound money, I will grow old and I hope rich, on the only form of successful liberty-currency I have ever witnessed in my lifetime: cryptocurrency.

 

Sincerely,

 

Jack Shorebird

 

P.S. Don’t let the .gov buttheads get you down. And think before you buy into Bitgold GoldMoney.


The above is my opinion. Make sure to consult your gold bullion dealer, economist, attorney, accountant and hair stylist, before you chance the Greatest Crypto Bubble of all time!

Electroneum (ETN) is Uber-esque?

Electroneum (ETN) is Uber-esque?

Dear Cryptocurrency Watchers and Dreamers:

The Crypto-Dream.

“So, do you want some Electroneum, dude? Just a taste? Yeah?

“Step into my dark alley.

“A little closer…”

Isn’t that what it’s all about anyway?  If you’re going to create a cryptocurrency, would you not make that cryptocurrency interesting?

And thinking this way, allowing yourself that luxury, how many cryptocurrencies out there, are interesting? Have any pizzazz? Ones that don’t make you want to throw-up after you buy them?

Take bitcoin for example.  We know it started in 2009 or thereabouts. Satoshi Nakamoto and all that. Please.

We know that hundreds of other cryptocurrencies are under development, but none have ever been as popular as bitcoin.

Even Nicolas van Saberhagen got in the act. And CryptoNote was born. And it was about time.

We also know that the Chinese really like bitcoin? Bull. We know that the Chinese (people) aren’t stupid. Why would an entire nation of near-slaves like any type of cryptocurrency that is traceable? Think again, Shirley. The PBoC (.gov) needs compliant subjects.

And we know that there are hundreds of other cryptocurrencies out there with varying degrees of excitement…and sheer boredom. Dull, as in sleepy.

So, where is the real McCoy? The real back-burner stuff, that we can move to the front burner – at least for a while?

Explosive adoption. A tidal wave of fun. Electroneum?

Bitcoin fights for superiority.  It struggles against its competitors. Bitcoin Cash, Bitcoin Gold, and many more. Ethereum, Ethereum Classic, Dash, Ripple and so on.

Crypto-creators are getting rich, but the investors are bilked – or is that milked? Why even try?

And the circus continues, right?  New processes, new promises, new wallets and basically the same old thing.

Download this PC app. Maybe we’ll have a cell phone miner – someday. For now, just wait. And wait some more. This takes time. More BS. More time. Meanwhile, we’re aging…

And zero “mass adoption.”

Wouldn’t that be nice? Mass adoption or “use,” in short order? A Pokémon GO routine. Uber-like.

Why?

Time.

Cryptocurrency can be very temporary.  Like the Hula-hoop or Fidget-Spinners.

And we know that hype can make people notice.  Or is it the other way around, if you build it, they will come. How about somewhere in between? How about if we sizzle it?

Is that the promise of Electroneum?  Having the same capabilities of Bytecoin, Monero and the CryptoNote protocol – but having some power behind it. Some excitement, but not hype. Some chutzpa? But not junk-coin.

And some live person to call and say, “Dude, like your coin but, well, I screwed up and forgot one freaking letter on the send address and now I have 1000 ETN’s in freaking stuck-like-pud-land. Can you help?”

“Electroneum here – we’ll get right on it, sir!”

Can’t do that with any other CryptoNote. Will we be able to with our ETN’s?

You’ve undoubtedly come across allegations from the Monero folks indicating that Electroneum is essentially a copy of Monero.  But was not Monero taken from BitMonero, by the alleged community?  Was not Monero taken from Bytecoin and the CryptoNote protocol, even if it has changed?

Sure.

Cryptocurrency is the land of clones and forks. In fact, the folks that brought us CryptoNote encouraged anyone to use their software protocol.

And now we have a Electroneum.

So, let’s get off our high horses, shall we?  Let the best man or woman, win.

I am sick of the purification schemes that never come to fruition. CryptoNote coins that never rise to the “user-friendly” environs, because, you see, the users are losers. The developers, lost in their own self-serving nodes, regale us with their genius, then crap on us with their half-baked excuses.

Maybe it’s time to let Electroneum give it a go.

If expert businessmen and marketers can combine their resources and use a product better than those who developed the original product, why shouldn’t they?

It sort of reminds you of ranching.  Once you voluntarily sell your cattle, the next rancher can do what?  He or she can compete with your business and sell more cows. You can go out of business for being less efficient or get to work.

Sure, people will like the privacy of Monero.  They like security, absolutely.  But if all you do is sell the steak, refuse to sell any sizzle, your business model may not succeed.

That’s what I think Electroneum is trying to do.  Trying to sell the sizzle and the steak, using the CryptoNote protocol, but centralizing part of the works. This certainly decreases the privacy part, but will it matter?  Will anybody care, if it serves to unseat the Fiat Gods of the Fed? Besides, we’re not talking about a coin that is being built in a third world communist regime.

Does anyone really think that cryptocurrencies are long term investment vehicles, though?  That cryptocurrencies are not temporary? Of course, they are. Things will change.

Come on, search your soul.  How many times have you deleted the bitcoin wallet from your computer?  How many other cryptocurrency wallets have you downloaded and deleted?

And I am not saying that I would rather have .gov fiat money. I think that .gov fiat sucks.  All I’m saying is we need to make some hay, while the crypto-sun is still shining.

Using that as a backdrop, anyone who invests in cryptocurrencies, might want one with immediate and powerful messages and a potential to rally — and rapidly expand.

Why? Is it not plain? Strike while the iron is molten, not after the .govs ramrod the innovators.

Less chance of losing money, right? More chance of making money, don’t you think? No more delay.

So, the key, is to recognize the next major expanding cryptocurrency.  That’s a tough job.

Looking back almost anyone can see how the new cryptocurrencies arrive on the scene. How they create some hype, suck in millions of dollars, plateau and then fade. More advertising is pushed out, more videos, professors, news guys, hot chicks — all talking-up the protocol while more investment money flows in; and then what happens?

“Adios, nitwits.”

Oftentimes you have a stationary thing.  A crypto-monster treading water until it disappears into the depths, with your cash. The crew and talk-bots shift to the next coin. Failures dot the crypto-landscape, but these coin-pushers thrive here. It’s too easy.

“Wanna taste for free,” they ask? “An air-drop maybe? This is some 3.0 stuff!”

So, you buy and cry.

The pushers call them tears of joy.

Zombie-coins. Churning coins. Incessant trading. Exchanges, feeding off the fees. Money tubes, full of lost labor. Math freaks gorging on code.

And it all sucks. And I’m tired of it, aren’t you? Way past day-trader mode and gambling. Now I want a contender, ready to show us the marketing stuff. Show the blockchain-lovers, how the hell it’s done.

Could Electroneum do that?

A few months later, after the next-newest cryptocurrency version has failed, no doubt the same guys will be back with the next great cryptocurrency. They’re trying again. ICO after ICO and dump after dump. They need millions more of your hard-earned money.  There is another rush to purchase, maddening pumps, spectacular dumps, and then the cryptocurrency is shoveled into that pit where our money burns. But they come again. Version 12. A new team. New protocols. New wallet.

Oh, just stuff it.

Cryptocurrencies are labeled as Ponzi schemes and pyramid schemes, somewhat like the current .gov fiat money schemes we use today.  We are told that cryptocurrency exchanges are unregulated, and they can essentially cheat their own system.  We are told that private money can lead to more crime but the cash in our pockets, created by our governments, is somehow immune?

With all this bad news, maybe a Electroneum is the good news.

At any rate, cryptocurrency is a choice.  It’s a free choice. Government money is required money.  And gold and silver are not legal tender, for the most part.

If you can’t crap, CryptoNote progeny (you know who you are) then get off the pot.

Let’s watch Electroneum.

Sincerely,

Jack Shorebird


 

Do You Own “S2S Compromised Cryptocurrencies?”

Do You Own “S2S Compromised Cryptocurrencies?”

It’s about peers versus subjects, is it not?

Are you a P2P or and S2S Person? That’s the gist of it, right?

P2P is what? Peer to peer, right? Person to person.

S2S is what? Subject to subject. Slave to slave, in some countries.

Pause. Think. Slave to slave = S2S?

So much is said in that P2P acronym. So much is lost in S2S. It matters.

If you are P2P, you are probably safe. But you can be safer. You can do one better.

As an S2S believer, you are in trouble. But don’t take my word for it. Ask Mr. History.

When observing the changing cryptocurrency landscape, we note capitulation and appeasement. Those who bring change; and those who want to stick to the old way of doing business. If not the old way, then bending the new way to the will of the old.

But P2P is not new. It has just been adapted to the blockchain.

S2S is the old way.

Why do we own certain cryptocurrencies, but not others? Why is the P2P idea the best thing to have hit cryptocurrency, let alone the human condition, in thousands of years?

But…there is P2P and there is private P2P, correct?

Many of the newest breeds of crypto-entrepreneurs have forgotten the words of Satoshi Nakamoto and have instead, chosen to use the blockchain technology for other reasons. And there is nothing wrong with that, save the lack of vision of such people. The automatic and almost tribal reductionism is inherent in the herd mentality.

In other words, the desire of many to belong to the herd at any cost. Spare no expense, they say. Trade your privacy and your freedom for a false sense of security.

Don’t rock the boat. Don’t go against the flow. You don’t really need or want P2P. You need S2S. We hear this so often.

So, let’s recall those words, just a few of them, purposely embedded within the Bitcoin Blockchain. “Satoshi’s Warning,” I will call it.

These words resonate today, and I submit that they will resound into the future — if we are still here. And these words will be taken more seriously in ten or twenty years, if world economies do finally collapse, and if cryptocurrencies save the day after that foreseen collapse.

The warning:

‘The Times 3 January 2009 Chancellor on brink of second bailout for banks’.

This statement gives one the clear sense that Satoshi had a problem with governments and bank bailouts. He did not agree with the current monetary system in general.

Why?

We can speculate about his motives, read his various quotes, but can we agree that he/she/they invented a well-functioning, but not private, peer-to-peer e-cash system? It seems to me that Satoshi, and I have stated this before, provided the outline – the foundation – upon which others could build.

And remember that: P2P. Let that echo over and over until it seems to lose meaning. Until the echo of it comes back after a time and reminds us what it really is. What its value really is.

P2P is that rock in the river, standing against the tide of financial tyranny. If that rock is hardened (privatized), all the better, but bitcoin’s P2P rock sits high in the rapids. It is “exposed” P2P and it is sandstone. Sandstone will not last. Even so, some want to convert bitcoin to S2S, now. They want to blast that sandstone apart.

If “exposed” P2P is the core value of the bitcoin service, how can it be improved? Satoshi warned that this P2P system was only temporary. That it probably would not last. Was he correct?

Satoshi showed the way.

Then Nicolas van Saberhagen came along and privatized the blockchain. It was the next step in the evolution of blockchains. Many other P2P models are “exposed” at some level.

Saberhagen (he/she/they) created CryptoNote and after a rocky start a new crypto pulled away from the pack: Monero (XMR).

Monero has one well known face: fluffypony (Riccardo Spagni). He came forward and I submit, took his freedom in his hands when he did so.

For all the rancor surrounding Monero and all the concerns I still have about its developers remaining behind the curtain of anonymity, I respect Mr. Spagni. And that is the point: trust. Not to mention that Monero was the first successful private crypto on earth. (Okay – that’s an assertion. Prove me wrong.)

There is another crypto that deserves mention here and I have cited it before. Aeon. “Smooth” is the developer of Aeon and works on Monero. Smooth is anonymous. This might be important in the future since Monero is slowly gaining acceptance on an international scale. Aeon would seem to be the logical partner in that effort.

And there are other private crypto’s out there, but I am only mentioning Monero and Aeon in this post as examples. Many of the other privacy based coins do not have the longevity, have changed hands, or have known developers – which is a risk.

There are arguments against the PoW (proof-of-work) based blockchains, such as Monero and Aeon, as well. Even bitcoin uses PoW, but Ethereum is apparently considering a PoS (proof-of-stake) blockchain addition or change-over. PoS is more energy efficient, certainly.

Obviously, these “proofs” will evolve over time, but getting hung-up in the debate may not be the best course of action.

In fact, allowing the salesmen, flush with crypto-cash, financed to the gills with venture capital, to present vivid images of Crypto 3.0, is a trip to S2S.

How so? These salesmen, often experts in the field of blockchain, are not experts in the field of privacy.

The war now is to destroy the very essence of bitcoin and any cryptocurrency attempting to remain private. It is an effort to undermine the best P2P out there. Usually, by means of overregulation and/or making such transactions illegal.

KYC. Know your customer. Papers please, comrade. You might be a communist-terrorist-tax-evading-immigrant. You might be a criminal. Just in case, we need to know you. Who is this we?

On the other hand, you are probably just an innocent citizensubject wanting to keep as much of your money as possible. And it is your currency, right? No, it is the State’s Currency. “But I have some XMR’s,” you answer, “not State Currency.” All the more reason to know you, comrade.

Privacy? You have no right to that; the herd tells you. What are you trying to hide? Nothing? Prove it. Show us all your currency and let us decide.

Welcome to America, land of the citizen-subjects. Hey, at least we can emigrate – so long as we have paid our taxes first. Even if you hand in your citizenship-subject papers, you must still pay your exit bills, before you may emigrate, right? And they dare call this freedom? (Hey, I’m American, but America is not a place – it was an idea – in the past.)

Is it any better in the UK, Australia, Canada, or Switzerland?

Because of government pressure, the cryptocurrency innovators are beginning to give in. Or maybe they never had the guts in the first place. They are creating what amounts to “S2S” or Subject-to-subject transactions. Weak sister versions of the almost true form. Compromised crypto’s, the lot of them.

But I’m sure they work just fine.

These new S2S innovators are the compromisers. They help support the current fiat monetary systems. The highly centralized, highly controlled, inflation pushing bureaucracies.

I labeled Cardano (ADA) as S2S compromisers. But they are not alone. Ripple (XRP) is S2S compromised as well. Even Ethereum (ETH)  advises that they will comply with governmental information requests. I’m certain there are many more S2S compromisers.

Few have the tenacity to protect privacy. Legitimate privacy. Many of the cryptocurrency exchanges bow to the might of “.gov” as well.

These S2S capitulators have good people working for them, however. They have children and dreams and I do not fault them for coloring within the lines. If they are to remain at liberty, to exercise their delimited freedoms, they must bow down. No blame can be placed upon subjects working within their enclosures.

It is odd that a fluffypony will not bow, however. It requires vision and nerve to stand, virtually alone. To back a crypto that will not comply.

The same can be said of Smooth and all the developers of both coins (Monero and Aeon). To believe that the “.govs” of the world have not discovered some of their identities, is foolish. And they know it.

And don’t give me that bull about sacrifice. These men and women working behind the curtain to privatize crypto are not doing so for free. Their trade, their gain, is profit. Their potential loss is their freedom. Is this a sacrifice or a trade? Are they, in a sense…

…mutually pledging to each other, their lives, their fortunes and their sacred honor?

Private P2P is a down payment on future value few can imagine. To buy the freedoms of their children. To refuse the current call for S2S, and see what happens.

I hope these private P2P men and women, keep at it.

Here’s the audioblog along the same lines: “The P2P Question.”

If you need to convince yourself that privacy is important, buy this: “For the New Intellectual”


 

Note: As usual, the above is only an opinion. I welcome any responses. In the meantime, do not base investment decisions upon any of it. Call your banker, broker, insurance salesman and/or financial advisor, if you must.

Bitcoin: Not a Value-Producing Asset?

Bitcoin: Not a Value-Producing Asset?

Dear Cryptocurrency Readers:

It’s good to keep tabs on the big picture while hoping for the good news. But don’t short change yourself if the time comes to make a choice between regulated or unregulated cryptocurrencies. It may be better to pay the tax, than pay the fine…or worse yet, be placed in a “political” prison cell.

Think long and hard about trying to hide your crypto stash and making your escape to some foreign island after you trade a chunk of it for some local fiat, gold or silver.

Things like crypto need to be won first in the courts, in countries where that is still possible. Political representatives must carry the banner and I feel that eventually, crypto needs an anchor. A hard currency. Only then will it be able to unhinge the fiat myth we have lived under for over half a century in these United States of America.

Is not that the ultimate dream of cryptocurrency?

It made many see, for the first time, that there is a way through this monetary nightmare we call government fiat currency. If it is only a pipe dream, that dream has had a lasting impact upon the minds of many – worldwide – I will posit. And dreams drive change.

Even if cryptocurrency dies, fifty years from now, people will remember, that for a brief time, the purse strings were almost given back to their rightful owners. The people. To you and me. We were almost back in control.

I write all of this in the hopes that I am dead wrong. That cryptocurrency, as it was meant to be, does not die, but evolves and helps to remake this decaying fiat world.

In short, this is not investment advice, it’s thinking advice. Education and speculation, is better than throwing the virtual darts at the virtual dart board.

For those who highlight cryptocurrency charts, citing all the technical reasons to “buy now,” know that the problem is a fundamental one. We need to look at the creators of these cryptocurrencies, why they make them, how they will work and so on.

Fundamental analysis is a must in the cryptosphere.

According to a MarketWatch article, Warren Buffet recently remarked that he thinks coin [cryptocurrency] offerings will end badly. “People get excited from big price movements, and Wall Street accommodates,” he said.

I don’t think Buffet gets it.

Buffet also advised that “You can’t value bitcoin because it’s not a value-producing asset.”

Now think on that a moment. “Not value producing.” That’s a fundamental issue, is it not?

So, it’s not a house or a farm or stocks. We know this. Buffet is not telling us anything new here, just couching it in investment terms. But remember, Buffet is also – if I can judge by his past statements – pro-big-government, pro-higher taxes for the wealthy…he’s a status quo kind of fellow. Rose colored glasses and all.

Guys like Buffet need what? They need the rules to remain “stable.” Capital gains taxes, income taxes, regulations, political support, all play into the scheme to use the system to earn more fiat money. Fiat money and other real assets, but all lubricated by a slowly crumbling (could be quickly) monetary system.

Bitcoin and company mucks up system, if they are seen as a currency replacement mechanism, say to the grand old investor types. So, they refuse to imagine the potential if such thinking requires them to start from ground zero. If it requires them to ask that burning question they refuse to hear: What is sound money? And the other one. Can we get along better without it if we pay off (buy) the bureaucrats and ask for special favors granted involuntarily, by the taxpayers?

But let’s compare.

Is digitized anything, say music, talk radio or even movies – are they value producing?

Yes, but they have an industry behind them. Singers, producers, directors, and labor unions. Companies with stock. Buildings, cars – the machinery of sight and sound.

Does bitcoin, specifically, have that same sort of structure? Or is it a bubble?

No. It has voluntary “assistance” right? Those who are willing and able to code and debug, right? There was no bitcoin creation company, as far as we know. Satoshi Nakamoto could be anyone or a group of communist sympathizers. We haven’t a clue.

Bitcoin is not an asset, in the traditional sense, only a service based upon secret codes, information exchange, shared data ledgers, miners, computers, internet use and so on. We know that bitcoin (currently) is very valuable, but subject to change, forks, political risk, clones, hackers and crowd sentiment.

Bitcoin is also subject to being replaced, at any time, by better technologies. Some new developer who can convince the world that this new bit of code is the cat’s meow.

Bitcoin is also subject to wide value fluctuations. Fluctuations, if you are risk tolerant, that can earn profits – or not.

So, bitcoin does not appear to fit any valuation model that I am aware of. Yes, it is anti-fiat, anti-capital controls, pro-personal banking, anti-inflation, anti-establishment, anti-tax, anti-status quo, and emotionally charged, probably a bit bubbly, but its asset value is, like Buffet contends – missing in action.

Is it just a numbers game?

Certainly, we are in new territory here.

Steve Wozniak of Apple fame thinks “cryptocurrency could become a better standard of financial value than gold or the U.S. dollar. Wozniak argued that Bitcoin is more stable and less prone to arbitrary supply changes.” This, according to a recent piece at Futurism.com.

If Wozniak does think, as the article suggests, that bitcoin is better than gold or the U.S. Dollar, he should qualify that statement.

Currently, the U.S. fiat dollar works, but into the future?

Gold? Well, it’s not used as legal tender in the United States in any huge way.

So, yes, right now, bitcoin appears to have a lot of advantages, except for what the article mentioned:  stability. You can’t depend on it.

Wozniak is a computer guy, not an economist. So, I would lean more toward the investor extraordinaire side – be a little Buffet-ish. But does not the truth land somewhere in the middle?

What seems to support Buffet’s words and may spell bad news for bitcoin and cryptocurrencies in general (maybe not Ripple or Stellar Lumens) is the recent news from AMD. AMD sells GPU’s which can be used for cryptocurrency mining. They are projecting losses now.

Does that mean cryptocurrency miners are no longer as interested as they once were? Or is it as this article explains, that the centralization of mining is requiring more than GPU’s? ASIC farms and other specialized processes, in China? Could it be a larger move away from mining altogether? A shift to Proof-of-Stake coins?

And then there’s the Russian angle to consider. Motherboard advises that the Russian Government is finally – if we can believe it – regulating these crowd funding mechanisms, i.e., cryptocurrencies. Taxation is coming to a miner near you – in Moscow. Wow, even America is past that part. Well, except for the registration part. “Papers please, Comrade!”

But what are the Russians really doing? Invading. It’s what aggressive regimes do. Take over other “countries.” This one is called “The Virtual Currency Country.” Dear Comrades, bend over and take it — be invaded.

Hey, don’t worry, America will probably join you soon. They will be a bit more coy about it, however. The bankers will hide behind the regulatory agencies, I’ll assert. Pushing them all the while to “register” all cryptocurrency related organizations, companies, and exchanges. Make them fall in line or suffer the fines, taxes and yes — Jail House Rock.

Just as Jamie Dimon hinted – arrests might be next. Oh, but they love the blockchain. Go figure. Wanna bet the bankers do not want a public blockchain — like bitcoin?

What does this tell you? That the banking industry will soon use the blockchain technology and then seek to outlaw all private cryptocurrencies? To monopolize cryptocurrency like they do fiat? With the blessing of the FED of course. Or maybe they will use a ready-made solution. Ripple? Hmmm.

Think again. Banking is about responsibility and control over the owned (official)  currency. They will want their own crypto’s. Crypto’s identified to their banks in some way. Ones that they control absolutely, if possible. If not, at least a Fedcoin, but then why would we need banks at all then?

Do you really think banks will outsource cash to Ripple? No, Ripple will be used to lubricate international transfers, until the banks figure out a cheaper system. A more profitable exchange mechanism.

If all this bad news continues, my concern is which non-establishment, unregulated cryptocurrency or system can survive and profit – long term – in such an environment? Will the ones which sought to comply with regulations early on survive in an anti-bitcoin world? Ones like Ripple? Ethereum? Stellar Lumens? How about Cardano?

And does this lack of backbone, a crypto’s desire to please the masters, only help to destroy a movement with the original intent to halt the devaluation of fiat currencies altogether? To replace the corrupt system, from the computer up?

Maybe so, but I still think that for now, one can profit if there are any major shifts from the dream – a private decentralized cryptocurrency – to the reality – soon to come “government regulated crypto.”

Not necessarily “state” created crypto, however. That wouldn’t be any different than the current fiat mess we are in now. In fact, it would be much worse. Every bit of your money could be tracked.

Welcome to a Brave New World.

That’s all for now.

In the meantime, you might want to store some coin on a Trezor.

Jack Shorebird


 

Cardano (ADA) is NOT Money, but that’s Okay — neither is Bitcoin…

Cardano (ADA) is NOT Money, but that’s Okay — neither is Bitcoin…

Dear Cryptocurrency Enthusiasts,

I heard the air just go out of the room. How can I dare say such a thing? I mean, why? Why challenge the Gods of Crypto? Because I listen to them when they say really dumb things and I’m a bad little sheep. I crap on their stage and bleat. It’s okay, I’m just a little sheep. Not much to worry about.

After reviewing several recent videos put out by the more vocal cryptocurrency developers and evangelists I wanted to reiterate a few things about what these pro-cryptocurrency, blockchain promoting, initial coin offering gurus and family, might be obfuscating: reality.

(There. I just let one go. Plop.)

And this goes for nearly all cryptocurrencies. Bitcoin, Litecoin, Sexcoin, Ether-bum and Frogpennies included.

What? There are no Frogpennies? You mean I was scammed? Again?

Dammit man!

I’m no newbie (noob) to this financial vehicle. I’ve been around the bend. Lost and gained. And I’m still here. Still playing the game. Still bleating and trading — and winning — for now.

“Freaking gambler!”

Hey…relax.

So, this is a reality check, from a fan of cryptocurrencies. (That’s me. Don’t forget that part.)

Is cryptocurrency anything other than a speculative vehicle?

I mean, look at where most of the money is going in cryptocurrency markets.  Most of the investment is going into bitcoin. Currently, bitcoin’s market capitalization is nearing $100,000,000,000.  Each BTC is now (almost) worth – $6000 each. It kind of wobbles there — for now.  Certainly, another milestone for cryptocurrency at large.

But is bitcoin worth anything at all? Go ahead. Torture yourself about energy, electricity and nodes. What type of value, other than a service value, does any cryptocurrency have?

Tick-tock.

How’s the mental argument going? Feeling twisted up yet? Okay, I’ll let you off the hook. It’s better for your blood pressure that way.

Wait a minute… The older guys and gals take this crap in stride. It’s just the younger ones who need to chillax. We’ve — us elders — been around the apple cart a few more times.

“Oh, but times have changed!”

No. They have not. Crooks are always crooks, not matter the century. Dummies are always dummies. Blonds are…  Never mind.

In the cryptocurrency world, there’s a lot of conjecture about the nature of money itself.  So, I’d like to explore that a bit. Remind the wandering souls who left their gamer chairs and headed over the crypto-couchs for beer and saki. (Which are both wonderful, I’ll admit.)

Hopefully, these wandering post-gamer types (Vitalik?) will sober-up before it’s too late — for the rest of us broke investors.

So, let’s get to it.

One of my favorite definitions of money was provided by Ayn Rand. If you don’t know her, consider yourself — sorry — uneducated.

Okay, maybe that was harsh. But if you are in the Fintech world, you ought to be ashamed.

If you go to aynrandlexicon.com and look up the word “money,” you will find the seeds of what I’m about to go over, there.

The Lexicon pulls this definition from a piece that Rand did titled “Egalitarianism and Inflation,” from the book titled Philosophy: Who Needs It, page 127. (Go ahead, look it up. You can google it. I’m tired of giving out shortcuts like candy.)

So, let me compare cryptocurrency to money. I think that a lot of people are disregarding this very important definition — to their own detriment.

According to Rand, money is a tool.  A tool that can be used to exercise long range control over one’s life. A tool that can be used for saving. A tool that permits delayed consumption. And, a tool that buys time for future production.

Think on that a moment. Pick up a wrench. Caress it. Did you just fondle money? Well, kind of.

Is cryptocurrency a tool? Can you fondle a crypto? Would you want to?

Certainly, crypto is a type of tool or at least an application, but it requires something a money-tool does not. Cryptocurrency requires energy. Electrical energy. It also requires a computer, software, regular updates, dedicated developers and user cooperation. These are only a few of the cryptocurrency requirements.

In other words, crypto is a “user of tools.” Catch that? It’s a multi-tool. (Oh, that’s gross.)

Can a cryptocurrency be used long range, however?

The apparent answer is that it cannot be used beyond a few years, without improvements. So, in this respect cryptocurrency cannot be used to exercise control, in a long-range manner.

Crypto is a shorty sporty. Heck, so is my wife.

Can cryptocurrency be used for saving? And by saving, I mean saving something of value (a tool — remember) that one can come back to in a week, a month, a year or longer — and pick it up, dust it off and say, “Wow, it’s still good as new.”

The simple answer, again, is…no. Attempting to save cryptocurrency beyond one week might be very risky. Yes, I’ve heard about bitcoin. Probably, before you.

In this respect, cryptocurrency cannot be used to delay any consumption for greater than perhaps a few days. It cannot buy time for the future.

Gold, for example, buys one “time” in a sense that one can delay using it for years. Maybe, if the governments did not control the price.

Let’s look at another aspect of money that Rand indicated was a definite requirement.

Money must be a material commodity that is imperishable.

Not a banana or pork bellies. Not energy or “trust.” Not nodes or networks. Material…and a commodity. A tough and tumble thing that just holds the fort and takes no prisoners — not even during “World of Warcraft.” (That should probably be Witchcraft.)

Now, you might ask what (exactly) is “imperishable.” And it is clear cut –  it is something that cannot perish or if it does perish it would take some serious effort. Computers and networks and games — they all go “bye bye.” Time kills them.

Cryptocurrency shall perish from this earth — I mean — eventually. Maybe in a few years. Maybe after Fedcoin awakens and the apparatchiks get going. Make a few arrests. Tax people into the poor house. A bit of insurance policy suicide.

So crypto is perishable, but for now, it’s a great fruit. Sort of like one of those irradiated, dehydrated apple chips. It’ll last for a few years on your counter, but once the dog finds it, yum-yum.

If the power goes out in your area, can you spend, save, and borrow a bitcoin? If your country makes cryptocurrency illegal, will you still use it? If, a few years from now, a newer and much better cryptocurrency is invented, what will happen to your preferred cryptocurrency? It just rotted. Perished into the doggy mouth.

Rare. Money should also be rare. Something that is abundant, easy to produce, easy to copy, easy to “fork,” does not meet the definition of rare. Think copy-machine. Think clones. Think, fiat-money.

Artificially reduced numbers on a digital ledger does not meet the definition of money, but it could be a type of functional currency. Reduced numbers of cryptocurrency atomic units do meet the definition of “limited,” but digital information is not in and of itself, rare.

Unless you print this — the words you are now reading (and why you waste you time here, I’ll not ask) — are born of code. Pixels instructed to turn on and off, by a bit of computer code, fed through a electronic processor. Okay, it’s not the best code. Not a crypto-code, but you catch my drift, don’t you?

Codes are not rare. They can be secure, however.

Money must be homogeneous too. Standardized. Similar. A dollar bill looks the same and spends the same all over the U.S. and many other places. (Yes, I know dollars suck — but they spend.)

Multiple kinds of functional money, i.e. cryptocurrencies, are not standardized. Although, many cryptocurrency technologies are similar they are not, for all intents and purposes identical. There is no standard. (Maybe that’s good, actually.)

Money must be easily stored.

Generally, this might mean that money is compact, perhaps stack-able, able to be placed in one’s pocket, transportable and able to be secured.

Yes, I know gold is heavy and past presidents in the US have stolen it from the people — and that it’s really hard to steal crypto.

But you know what’s even harder to steal than crypto? My thoughts. Electronic (and chemical) codes I can relay to you via spoken or written words.

I have secret thoughts too. Try and take them. On second thought, don’t — you might get sick. I’ve seen some pretty messed up things in my life.

Is cryptocurrency easy to store? In some sense, saving information on your computer is quite easy. But is that true storage in the physical sense? And isn’t that what we’re after? The ability to place money in a safe, under your mattress or in a tin can in your backyard?

Are my thoughts money? I think I have nodes too. My neurons are decentralized in my brain for sure. Billions of nodes, just humming along.

Money should not be subject to wide fluctuations of value, according to Rand. This seems straightforward. Sort of like, “Duh!”

My thoughts fluctuate. Crypto pops up and runs to ground often. I wonder, can I trade my thoughts on an exchange?

If you place a government issued coin in your pocket, unless you live in Venezuela, it will probably maintain its value throughout the day, perhaps an entire year.

On the other hand, if you stored a bitcoin on your computer hard drive, next week it could be worth twice as much or half as much.  And this goes for most other cryptocurrencies as well.

Not so for my thoughts. They are worth zilch, until I use them to develop something — say a crypto. There, I just did. Did you feel it? Wanna buy some thought-crypto?

So, fiat currencies are terrible, but they generally hold their value over longer periods of time – a stable value — when compared to cryptos. Especially my thought-cryptos.

What else is important about money?

Well, if you can’t go to the market and spend it, there’s a problem. If you can’t buy a cup of coffee, a soda, or a car – anywhere you normally go – there’s a problem.

Oh, please don’t bring out that BTC ATM map. Just go to the store and let them stare at you like you are a “nerd.” (Hint: you are. But it’s okay. They meet on Wednesdays, I think. Make sure to bring your pencils.)

So, if a cryptocurrency is to become a functional money it must be in demand among those you trade with. Not only the Wednesday “Nerd” Group. Currently, cryptocurrency also fails in this respect.  Let me repeat that, currently. Today.

(Note: Nerds may conquer the universe. Just look at Bill Gates. He’s got his own crypto now. “Way to go Bill, you copycat. No, I know you did not copy Apple…”)

Let’s get back on track, before Billy gets made and shuts this blog down. Really, I apologize Billy. I know you love crypto too.

Using Rand’s definitions, it seems that the only true money is gold.

“Oh not that rock thing again. You’re so retro, dude!”

Straighten up. Get a job, before your dad kicks you out.

Gold has a tangible value, but, as Rand states it, gold is “…a token of wealth actually produced.” Moreover, the transaction itself becomes much safer, much simpler, because it is like bartering.

Let’s recycle.

“No, Mr. Retro. I need to get back to War of the Witchs II!”

Money is a tool.  Cryptocurrency is an application that uses a tool – a computer.

“So.”

Tools can be used over long periods of time. We do not know how long cryptocurrencies will last.

“You mean it’s like a new modified game?”

No. Listen.

“Why?”

One can save a money-tool. If one saves a cryptocurrency application, it may be outdated within the year.

“Yep, just like my computer games. I sort of get it now.”

If you delay using your cryptocurrency, you may lose all your money – all your value.

“Right. You can’t sell used games for squat after a few months!”

The money-tool ought to be imperishable. Cryptocurrency is perishable.

“Games are dead soon after release!”

Right and a cryptocurrency is not a material commodity.

“True. I download my games now.”

Cryptocurrency is not rare, only mathematically limited.

“You got me there, grandpa.”

Cryptocurrency is not homogeneous in the sense that it is standardized among the persons with which you trade. If cryptocurrency were standardized, this might increase its demand.

“Yeah, a lot of dudes can’t stand War of Witchcraft at all! No demand. Puds.”

Cryptocurrency requires a stable value – if it is to escape the bonds of speculation.

“Hey, I made a few bucks with mining Piggycoin a few years back!”

Aside from the fact that cryptocurrencies do not meet the ‘Randian’ definition of a sound money, this does not mean that its value will not increase.

“Like I said, the Piggy was good to me. But my mom got tired of the high power bills and the gizmos making all of that noise.”

Even if governments choose to define cryptocurrencies in different ways, those jurisdictions with the least amount of regulations appear to be reaping the benefits of increased Fintech investments, for now.

“I heard that. But I’m not leaving America for some European paradise.”

Cryptocurrency is also voluntary. Fiat currency is not.

“That’s the point, right?”

Cryptocurrency is also trustworthy, in many cases. Many people trust the math, but some are concerned about the developers who write the code.

“Dude, you are confusing the hell out me. First you say they suck, now you say they don’t?”

Is fiat currency trustworthy? It depends upon the country, the economy and the leadership.

“Oh, yeah. Bummer.”

One thing is certain, however, even with two arms tied behind its back, decentralized cryptocurrency has captured the imagination of the people.

I think that any blockchain adoption by governmental entities, will only serve to solidify the people’s belief in the private use of the blockchain technologies.

I’ve also included a YouTube video of mine, highlighting some of the above issues.

“Dude, can I go back to my games now?”

Sure.

 

Sincerely,

 

Jack Shorebird

P.S. I’m selling my thoughts for one BTC each. Guaranteed to be far more awesome than any cryptocurrency ever mined, minted, spat out, staked, gassed-in or farmed-out. There is a limited supply of my thoughts because one day I’ll be dead. (Shut up, I heard that.) Just leave a reply and we can work out the details. I’m not going to leave my BTC address. That’s just tacky as hell, don’t you think? Hurry, this is a limited time offer — maybe less that 30 years before it ends and my decentralized network will cease to function.


(Disclaimer: The above is the opinion of this writer. Any appearance to reality is merely a coincidence. If it bothers you, mine some ‘coin.)


 

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