Tag Archives: ICANN

Three Predictions for Cryptocurrencies in 2018: “SPACE”

What’s Next?


Many people ask where cryptocurrency is heading. I thought I’d take a moment here and delve into that. A bit of forward conjecture.

Why?

Because I can’t seem to find it all in one place. Just bits and pieces of negative and positive elements. So, I jammed a few of them in here. And it’s all my opinion, of course. Take it with a smidgen of rock salt.


Predictions:


1. The CCE’s will Official-ize and DCE’s will not matter

Centralized Cryptocurrency Exchanges (CCE’s) may not survive in their current form. The year 2018, in the United States, will test their mettle.

Why? Tax laws, crypto-friendly countries, atomic swaps, and:

Decentralized Cryptocurrency Exchanges (DCE’s).

In a recent interview by an unnamed person, as not to disparage the name of a particular CCE, it was learned that things like atomic swaps and/or functional DCE’s are years into the future. That is, according to the CEO of this particular CCE. That centralized and regulated exchanges are better suited for a servile public and institutional investors. Regulation is acceptable.

Bull. We have grown up now. Training wheels are not handcuffs.

Some CCE’s even pride themselves for their transparency. They put a face to their company. They stand upright and walk on two legs and pay their taxes as all good citizens should. Even if the monetary system is rotten to the core. Don’t you dare try to improve it.

The anti-government stance seems to worry the CCE’s. Just be nice and trade, they ask. We are all in the same sinking boat after all – the CEO says from the crow’s nest — as the waters rush in.

But let’s face it. If a CCE decides to go transparent, it has no choice. The business model they chose, for good or ill, requires that they follow and not lead, at least in the U.S. In the U.S., CCE’s must create and maintain a KYC, AML compliant trading platform or face prosecution. It’s that simple. No submarines allowed. Surface ships only, please. Even if we lose the war.

Add to this CCE mix, the recent 2018 U.S. tax law clarifications regarding cryptocurrency trading and one can speculate as to the true motives behind a certain unnamed CCE’s recent announcement that they are moving in the direction of U.S. Dollar trading – for most users. And that they are apparently seeking to offer actual securities (stocks and bonds) in the future.

Why? They are losing money – or soon will be. They need you to buy and buy now. The sooner the better. Use lots of cash. And, as the tax laws kill the cryptosphere in the U.S., the CCE’s will “evolve.” No, Mr. CCE, you will capitulate. You will spring backwards, to the safety of the fiat. And there, you will die Mr. CCE, for lack of verve and vision.

And that leads into the DCE’s. In their current incarnation, they are worthless or nearly so. Dead on arrival. You must pledge a bit of expensive bitcoin, choose a third party to settle disputes and wait forever. DCE’s are slow to improve, unprofessional, not user-friendly and untrusted.

Perhaps the new impetus will be the desire for free trade, unhindered by the regulations and onerous tax laws.

But we need something more.


2. The U.S. New Tax Laws will be Ineffective

Translation: Cryptocurrency trading is slowing down. U.S. customers especially, are not trading like they used to, because they know that each time they do so, they can no longer claim a “like-kind” exchange. In other words, the tax hit is helping to drive cryptocurrency prices lower. It is also killing the centralized exchanges – which could be a good thing.

U.S. based CCE’s must now shift into another gear if they want to stay in business. Aside from the threat of atomic swaps and DCE’s, the fact that trading will continue to slow because of tax laws, means that the CCE’s will begin to consolidate and/or offer more services.

This is already happening. It’s called survival mode. The hangover after the party. Luckily, there is still plenty of booze left, but it’s cheap booze now. Bitcoin is no longer as “top shelf” as it once was. Bitcoin Cash continues to hammer away.

These new tax laws, reduced trading and the bubble-popping amusement ride, is soaking value from the CCE’s, at hyper-speed. Where once, the cryptos flowed like champagne into the golden baths of the CCE’s, it now dribbles in as diluted, headache-inducing, sparkling wine, from the Left Coast (California).

As a result, expect CCE membership fees to emerge, large balance requirements, the wooing of institutional investors with unpublished deals, and the farming-out of the expensive retail arms to other companies, especially where labor is cheap. Expect more ads.

The net effect? The little guy will be left holding cryptocurrency he cannot trade, without first signing his life away. Should the little guy hold private coins, he will be suspect. Where will any freedom-seeking individual go?

This is why I feel that the new U.S. Tax Laws will be ineffective. They will make a show of it, force the crypto lovers underground, arrest a few, let the problem fester, and in the end, they will wake up with a new money. It is simply a matter of time. Even the dinosaurs died out.

Sophisticated traders and gamblers might hire third-party fictions to hold their crypto, but the vast majority will not be able to entertain such extravagant schemes. Tax loopholes are for the affluent.


3.The Rise of “SPACE”

If you live under a rock, you’ve never heard of a DCE. That’s fine. Maybe atomic swaps are your thing. Or even Atomic Coin, which is another altcoin. But I don’t think you’ve heard about this next idea. It’s not about another blockchain.

Spontaneous Private Atomic Cryptocurrency Exchange(s)? Or: S.P.A.C.E.

It does not yet exist.

I predict we will see the beginnings of SPACE in 2018. It will be a combination of a CCE, DCE, Atomic Swaps, and best of all, it will be anonymous and untraceable. Imagine a private-Amazon with its own Monero-like cash that spends everywhere, instantly. Making fiat superfluous. (I’m an optimist.) Where you can store your crypto in the new cloud and access it where ever SPACE is used.

Already, we are seeing hints of this. Cloakcoin. Litecoin in talks with Monero? Some countries creating their own internet, with different protocols. Sharding altcoins, like MaidSafeCoin, just to name a few.

They all seem to miss the mark however. They all must ground themselves to the given ICANN.

What if they didn’t?

What if SPACE was created as needed? You initiate a private connection to a flexible network where there are no third parties. You buy, sell or trade instantly. Your choice of payment (coin) is saved, privately. And you disconnect. There would be no fees, no records, save your own and no limits. Everything would be automatic, anonymous, user-friendly and secure. Once the developers released such a network into the wild, it would, like bitcoin, be maintained in a similar manner.

Therefore, the next big thing, at least in the Cryptosphere, will be way out there. Beyond the current internet completely. A quantum leap and a human achievement that could set the stage for the next leap forward.

That is the idea, isn’t it?

Will you be ready for SPACE?

–JGS


 

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Bitcoin: The Gathering Storm

Dear Crypto Fans,

Excuse my absence. I’ve been reading all the news lately and it has made me slightly wary of things to come.

The crypto innovators are being hunted…again.

Prepare for more American regulation…again.

Followed by the UK.

And probably Australia…again.

Wendy McElroy called it the Pitbull assault, in the US. She’s being nice. She keeps tabs on this crap and I suggest keeping an eye on Wendy.

Uncle Sam is taking square aim at your stash of crypto now. Bitcoin et al.

Maybe Uncle Sam is tired of his missing tax loot. More than likely, he’s about ready to print a load of paper money to pay down the debt through inflation. It would be smarter just to e-print some crypto, but allegedly the US gov’t isn’t biting.

If there is one thing that could put a serious dent in cryptocurrency, internationally, this is it: S.1241. Or, perhaps more accurately, push crypto underground – in the US, UK and Australia. Okay, let’s add South Africa.

Did I miss anyone? Canada? Please.

Crypto Black-markets may be about to explode in the old free-world, as a result. But how long can they last?

Who controls ICANN?

Reactions from this news might push people into the privacy coins. Monero (XMR) is up of late, but some of that may be from news that you can now purchase discounted music with XMR’s. In other words, it’s marketing. No, Jethro, it’s privacy.

Privacy, privacy, privacy.

Let me harp on that. Get ready. It is possible that the Winklevoss Twins backed the wrong horse. It’s okay, but if they are smart, you should see a rising Monero now. Slowly at first. Then faster.

It is highly probable that governments will continue to attack cryptocurrency as a threat, as a bubble, as an unregulated investment vehicle, with no intrinsic value. They will hold out their own valueless fiat currencies as the one true god. Bitcoin will be beaten.

Don’t pray too hard. Diversify. If not Monero, any other privacy coin you think is good gumballs, buy them. You might live to regret it, if you don’t. I seriously doubt you will regret it, if you do.

S.1241 states, if you are a US subject (I am) – you must comply. They will cancel my passport, if I do not. This is my prison camp. How big is yours?

The United States must modernize. I’m serious, that’s the buzzword: modernize. But think of this word instead: confiscate. I mean, at least be honest, pud-winkles. Modernize what? The confiscatory tax laws?

And don’t think there is an out.

S.1241 covers all the bases. Ownership. Control. Cryptocurrency exchanges. Paper wallets. Brain Wallets. Hardware wallets. My dead grandma’s coffin stash. Hey, they even made it all-encompassing: funds stored in digital format are subject to reporting requirements, if the bill passes.

And you think it won’t pass? Do you remember why Jesus tipped over the money-changer’s tables?

By my estimation, there are over 30 million Americans holding (HODLing) crypto. I hope there are more. Eleven more disciples at least. No Judas.

S.1241 is attempting to amend a section of  Section 53412(a) of title 31, United States Code. And it appears as if our illustrious US law makers will do it on the sly. Middle of the night stuff. And soon.

Satoshi Nakamoto warned us. Bitcoin was only a temporary solution.

So, what is a more enduring solution?

Monero? Grin? Aeon? Electroneum? Bytecoin?

Any port in a storm.

And for the record, IOTA. I have a bad feeling about it. I hope I’m wrong.

 

Sincerely,

 

Jack Shorebird


The above is all opinion. If you think it’s off the mark, that’s okay.

Cardano (ADA): Is Proof-of-Stake Unproven Tech?

Updated November 20, 2017


Dear Cryptocurrency Enthusiasts,

Trust, trust, trust — or baloney?

In each other, we trust?

Trust, but verify…especially with cryptocurrency?

It seems that we have three developments occurring simultaneously, now — in the Fintech Crypto-World.

  1. Proof-of-Work (PoW) is moving to Proof-of-Stake (PoS).
  2. Public is moving to Private or “choice.”
  3. And governments are trying to regulate.

Did I tell you something you don’t know? I hope not.

PoW. It was the most trusted way to create and maintain a person-to-person (P2P) network. But what happened? Has the crypto-space evolved?

PoW has become labor intensive, energy hogging and increasingly centralized. Bitcoin, Ethereum, Litecoin etc. Ethereum is attempting to move to a PoS system or at least use some of its protocols. Really? Again, why?

Why was the PoS protocol developed in the first place? Peercoin, Blackcoin, Cloakcoin and others. Were there long term issues? Security disadvantages? They drew less power, were faster, but they were essentially a pre-mine. But they reward those who maintain balances – and help to secure the network, right? Reward with an ever growing supply of cryptos, unless that supply is fixed — which appears to be the plan for Cardano.

What were (are) the results of PoS? Marginal success. Can a new PoS protocol reverse that trend?

Peercoin, for example, had problems with their code early on. Their primary developer is anonymous. Cloakcoin has changed hands.

What was worse, these PoS coins were more vulnerable than PoW types – less secure. So, why is Ethereum attempting to move in that direction? Aside from the official reports, I mean?

Competition from Cardano?

We know Cardano was developed – at least in part – by a former Ethereum developer, turned Ethereum Classic developer/supporter. To, me, that smells of trust. That smells of new blood — underdog — PoS+ blood type.

But the underdog is only in name. Like Ripple, Cardano has removed the curtain to reveal that it too is willing, at some level, to cooperate with regulators. They are willing — and able — to compromise. If we look to Ripple, they are succeeding.

To roll back the blockchain, as Ethereum did, to stop one criminal – okay, one “advantage taker” – smacks of centralization. (See the DAO Incident.) At that juncture, no matter how benign a dictator, Ethereum lost its way. One cannot punish the whole, to catch one mistake.

So what stain does Cardano have? As a free market supporter, the stain is called compromise? Or is it realism.

In other words, Cardano is not seemingly attempting to create a separate cryptocurrency and/or protocol, as much as it is attempting to “get along” with the regulators. It wants to identify you, at least on one level. KYC — know your customer. The smart contract-currency platform that might be too smart for its own good.

And, in my mind, Cardano, unlike Ripple, wants you to participate. Game changer?

Ethereum Classic is “righting” the wrong of Ethereum. Still, the system – the protocol – is slow. It devours resources. Energy for mining. Power hungry.

So, what is the solution?

A PoS Ethereum, with new math: Cardano?

Here’s a recent opinion from Charlie Lee about PoS.

Now, we must decide. Do we trust the PoS? The pre-mine with a large chunk of coins held back for the “company.” Do we trust corporations? They act in their own interests, right? They must make a profit to survive, certainly. How much is enough?

And they are willing to share profits if we support the system?

Many cryptocurrencies are headed by corporations today. Mining warehouses keep many coins alive – corporations regulated by their respective governments. Of course, letting governments create cryptocurrencies will be a cluster-fork, of enormous proportions. But it’s heading that way today, in many countries.

Bitcoin’s reality is that it is managed by people with differing points of view, but they must come to a consensus to move forward. Hence the slow-to-change mentality. Is it outliving its usefulness? Some will tell you it has.

It seems that the move to privacy coins, created by unknown players, is an accident waiting to happen.  We need – IMO – the human factor. The “part” in the virtual machine that is not virtual. To service the humans who use the crypto. Or do we?

Privacy coins obscure their process, as to be non-auditable (or having a choice to audit), in a way that gives many the willies. Not because we want cash-like privacy, but because we wonder who else is using the protocol and why.

So, what can we say. Cash has no feelings. It’s just cash. True. But if you have the protocol to trace the bad actor and you don’t? What does that make you? An accomplice?

The one weakness in that cash-privacy crypto, one which you might hold on your flash-drive, is the customer service angle. If the currency “forks” and you didn’t update in time, what then? Get on Reddit and start complaining? Really?

Where is the “Complaint Department?”

Grandma likes to call people, right? The old school likes warm voices, emails to real organizations, faces to names. The old school lives and saves, on trust. Is Cardano that trust? The new Savings and Loan of Fintech Crypto?

And isn’t that what it’s all about? If we strip away the layers of protocols, unload the software, and just listen – who do you trust to keep your money? I’m not talking about playing the crypto-markets, drifting from one coin to the other, riding the emotion-horse. I mean, the bare-bones of it.

It is not the machines we trust, yet. It’s the people.

Isn’t that what it boils down to?

The fact that governments want to regulate may not be the best reason to flee into the “dark” coins. They will chase any entity that threatens the fiat empire. The darkness only eggs them on.

Regulations change because of force. What is the force of millions of cryptocurrency wallets, worldwide? It is a wave. A tidal wave.

Put your ship in the deep water.

A cryptocurrency that is backed (or less regulated by whole countries), will place pressure upon the bankers of old – the money-changers of the past. Especially, when it is trusted by people everywhere.

How would the empires of old stop that?

Can they, ICANN?

I don’t know if Cardano is the answer, but maybe they are onto something.