Tag Archives: technology

Bytecoin is still kicking…


Just a quickie, before you throw yourself under the bus…

Today, I received a response to one of my blogs about Bytecoin. It was a link to video, an audio actually, of an interview with the mysterious Jenny Goldberg. Goldberg is the new Community Manager, if we can accept this — of Bytecoin.

(Hi, Jenny.)

The connection seemed to skip or warble at times and Jenny herself, to an American, had a strange accent. I’m no ‘world traveler’ and I could not place it.

I also checked Reddit and the video was also posted there.

As some of you may recall, I often blog about various coins, especially the more anonymous ones, because I think at some point, many in the cryptosphere will actually desire a more secure and less public coin. Meaning, a cryptocurrency that is usable by anyone but not visible to everyone all the time — like bitcoin.

It’s a move simply waiting to happen. The developers have been gearing up for it.

In the mean time, there will be a large number of people who will desire the services of an anonymous coin network now. They come in several flavors of dishonest, but the bulk I feel, will be derived from the honest. Those simply trying to find a way to move and/or store value (money) in a place where others, including governments, cannot get to it.

Think on that for a moment. Let me name a few places. China. Russia. North Korea. The United States of Taxes. Cuba. Greece. Cyprus. Venezuela. Planet Earth.

The thing is, I don’t want people to get screwed. That’s why this video I mentioned is important to hear. First, do a little homework. Learn about Bytecoin. Determine for yourself, if Monero is simply trying bash a good system. And I have spoken highly of Monero in the past. Now I’m more neutral.

Secondly, make your own educated decision. Is Bytecoin good to use? Can you send value over the internet in a secure fashion, with Bytecoin. The quick answer is yes, you can. The system does work, but be fast about it. Transfer and get out of it as fast as possible — if you must use it at all.

You want to retain as much value as possible, after all. Let someone else take the risk of “holding” any cryptocurrency. It’s like holding a greased pig on crack cocaine, while drinking a beer and talking to your wife about painting the downstairs — again. It is nearly stupid, for now. Even bitcoin holders might find themselves in a world of poop, if the market decides that crypto is “old hat.”

I’m not saying to stop making money. Go for it. Spin that dial and laugh. I am. For now. Just know that the next idea is just around that dark intersection — where the bus is coming.

And listen to regular people. Too many times we gravitate to the news fed to us. I even cite them in my posts. This magazine or that financial expert. Know that in this vein, the blood that runs herein is not necessarily blue. The value if these things is transitory as hell. And the last time I looked, Satan’s Pit of Boiling Mud (think Yellowstone National Park) is still looking for permanent tourists.

And for the record, I’m curious as hell about NAVCOIN these days.

Have a good day.

Jack Shorebird

 

 

 

 

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Is Bitcoin in a Bubble?


The Big Question:

This seems to be the question of the day, if not the decade.

Can cryptocurrencies replace money or are they just another bubble?

The answers vary.

To the optimist, but not necessarily the realist, bitcoin is already money. So, yes, not only will it replace all government fiat cash, but it will free the masses from the tyranny of the state. It will never “bubble” and the way it’s designed, it will only become more valuable with time. Freedom for all forever and all the drugs you want. Gold? It’s a quaint idea. Caveman monetary policy, complete with pretty rocks.

Okay, maybe that was a bit overboard.

To the pessimist, no. Bitcoin is a Ponzi scheme. It is a well-marketed fiat asset trick. Don’t fall for it. It will eventually bubble, crash and burn. In the meantime, it will benefit the criminal element. It must go and/or be regulated as soon as possible. The state should always be the final arbiter of monetary policy, after all.

To the middle-of-the-road folks? Bitcoin can exist along side the current fiat money systems. It should work within the current frameworks of nationalized  monies, however. It can improve things from there. We can create a sound money standard after we iron out all of the regulatory kinks within the new cryptocurrency technology.

Unfortunately, our governments, as they are now designed, will not be able to survive on a diet of sound money and that is why fiat money was created in the first place. To escape the bonds of reality with a legal fiction, all the while, kicking the inflation can down the road.

But why not stop inflation by connecting bitcoin with gold? Make each one represent a certain amount of some rare earth metal? Why not couple gold and cryptocurrency, privately? Because the political environment is fiscally destructive. That’s why.

We know that our centrally planned economies will not allow citizens to derail the inflation machine which keeps our governments in control. It is only when the puppeteers begin to loose control of inflation that the money strings of government unravel, resulting in a revolution against the “evils of money.” Such revolutions do not always end up with a population of free citizens, however.

Cryptocurrency Negatives:

So, let us be cruel to ourselves. Take it on the chin, like a good cryptocurrency enthusiast should.

What is often cited as the main reason that bitcoin (or any cryptocurrency) can never serve as money? There are many reasons actually and here are a few:

  • Unstable Value
  • Trust
  • Fiat
  • Acceptance
  • Taxation
  • Bubble

Now, before we go off spouting all the great things about cryptocurrency, lets define money. I mean, what is this paper stuff we carry in out wallets and what are those electronically recorded digits in our banks? Better yet, let’s just define a good money.

Money:

  • A tool of humans
  • Used when high level of productivity is reached
  • Desire for long-range control over their lives
  • A tool of saving for delayed consumption and later production
  • A material commodity which is:
    • imperishable
    • rare
    • homogeneous
    • easily stored
    • not subject to wide fluctuations of value
    • always in demand among those you trade with

Source: Ayn Rand Lexicon

Few people ever go this deep, however. The dollar, euro, yen, dinar, peso, franc, pound, lira, rupee, krone, zloty, rand, and the shekel are, for all intents, legal notes. It’s money for the masses. Buts it’s not real money. It’s fiat money, which represents nothing but trust. I trust you, do you trust me? Besides, what choice do we have, right? It’s legal tender. It’s easier to use than chunks of silver, which the government wants to value in fiat anyway.

You can, at least in the US, pay your taxes with fiat currency and most of us trust that the currency is money.

We also know everything is becoming more expensive, but few of realize that the root cause of inflation is not the weather, the wealthy or our enemies. It’s simple math. The more fiat notes we print or e-print, the less valuable they become. This holds true for some cryptocurrencies as well. You simply divide the value, in fiat currency, by the current number of altcoins. This gives you a rough estimate of the fiat value of a particular cryptocurrency, at a given moment in time.

So, it’s easier to understand values with cryptocurrencies, since their creation is usually straight forward. There is no Federal Reserve to manipulate alleged M1, M2 and so on. There are no banks to create endless supplies of fiat. The only inflation regulators in bitcoin, for example, is its code base. It is currently programmed to create a finite number of BTC’s. It’s not manipulated to screw the masses, but to retain its spending value.

Paper money used to represent or hold title to gold or silver. That was why it worked. Why it functioned. Once the paper no longer held title to some form of property, it became fiat. It became dysfunctional. At that point, almost always, economies begin their decline. Some economies decline faster than others of course.

Perhaps if our governments set hard long-term limits on fiat numbers, then our fiat monies might stand a chance. But there are no such limits.

High Hopes:

Many hoped that bitcoin could save our failing economies, tame our ever growing governments, and usher in some new global paradigm of wealth, but not without effort.  If this is your thinking, you are guilty of being overly optimistic and just maybe, a bit naive. Don’t worry, I’m rooting for you because I’m a near-convert myself.

What holds us back from becoming “one with the crypto?” History. It is full of examples of ledger based monetary systems that ultimately failed. It is replete with evidence that all of the fiat based systems failed as well. And the gold-backed systems — failed, but after the decoupling of functional money (paper notes) from the metals. The governments enforced these failures, often by confiscating the one form of money that has never become valueless: gold.

So we have to ask ourselves why have all monetary systems failed throughout history? Now, I’m not asserting that gold became worthless–ever. Fiats did. Ledger systems were scrapped or forced out. Seashells were abandoned. But not a single monetary system transcended all governments, in any cohesive fashion. Bitcoin, though an asset, does.

Asked another way. Aside from gold and silver being an asset for thousands of years, what monetary system, fiat or otherwise, has ever existed beyond the constructive control of all governments, simultaneously?

Bitcoin as an Asset:

The latest thinking is that bitcoin (cryptocurrency) is not money, but acts as like an asset. That is Peter Schiff’s thinking. Schiff works with Goldmoney Inc., based in Canada and he lives in Puerto Rico. Goldmoney(tm) is a company that allows you to spend gold, via a debit card, in many countries, for a small fee. You can also store gold in various vaults around the word. And there are other benefits.

You can find out about more about Schiff’s views easily. He has his a radio show, owns several companies, is an author, but to sum up his financial views I would offer this:

He has repeatedly held bullish views on long-term investments in foreign stocks and currencies in countries with sound fiscal and monetary policies, as well as global commodities including physical precious metals and has expressed bearish views on the US economy and the US dollar.

Source: Wikipedia

So what is an asset?

An asset is anything of value that can be converted into cash.

Source: Investopedia

It’s a bit more complicated than this, but for the sake of argument, all cryptocurrencies are assets, since conversions to some other form of trusted money is the fundamental purpose to both buy and hold bitcoins. I mean, that is the allegation, right? Moreover, as Schiff asserts, companies that accept bitcoin in payment for services or products, ultimately convert it to either fiat currency or some other more trusted asset. Sure they do. After all, what real choice do they have? None.

In other words, the companies that will accept your bitcoins direclty just want to sell you stuff. Of course they do and they are held to the regulations requiring them to report their earnings in a nationalized fiat currency format. A government euro. A dollar. One wonders what would happen if companies and citizens were not required to convert to government fiat money? If they were actually free to use the asset of their choosing for all debts, public and private.

But we are not free in this sense. Not completely.

You Must Comply:

Are we to then shrug and comply? I don’t think so. The future is not made by those in the halls of government. That is not the purpose of government. They are present simply to protect and serve the people. They are peace keepers, not currency makers. Currency and money should be denationalized anyway. Things like bitcoin serve as a reminder of who should be in charge. Even if it fails. Even if it is a bubble.

Under the current circumstances, bitcoin, as asserted by Peter Schiff, is untraceable. This, I’m afraid is close, but not the complete cigar. All bitcoin transactions are public. You can see them zip around the network, but they can be obfuscated for privacy and criminal reasons. And your name is not attached to your account. Other cryptocurrencies are much better at retaining your privacy.

A Common Criminal:

Naturally, Schiff keys in on the criminal aspect. We’ve all heard it. A terrorist or crook will send his bitcoin, instead of carrying cash. At some point the bitcoin will be converted into cash to buy or sell something illegal.

One of the main problems with this criminal tactic are the fluctuations in bitcoin prices. The criminal might have a set price for his product and bitcoin is terrible for that reason. Perhaps it would be better to use what is called Tether ™. It’s a bank backed cryptocurrency that is almost pegged at the US dollar. Better yet, use paper dollars or digital fiats. That’s the routine.

I used to work in criminal justice field, just a few years ago. We rarely came across evidence of cryptocurrency use. Maybe it’s more prevalent now. What we did come across were stolen credit cards, emailed cash, fiat bill, drugs, debit card numbers and so on. Criminals wanted dollars just as fast as they could get them. Not gold or silver coins, but paper fiats. They used the banking system and filed false IRS refunds (very lucrative since the IRS does a terrible job of policing their own refund system) as a way to easily subvert the antiquated, government regulated, fiat monetary system.

This is not to say that cryptocurrency is immune to criminal exploitation, but cash is king — by law. And even criminals love to exploit that law. Some even print their own bills. This is next to impossible with bitcoin.

Bubbles:

The comparison of cryptocurrencies to the Dot-com bubble is also interesting, but old. The idea that investing in cryptocurrency is similar to a fad or is speculative, is certainly a strong argument, however. More and more people are becoming aware of the technology and as a result, more money is flowing in. Is this a new opportunity for those who are already versed in their use and speculation? Sure it is. The first comers are on top of that pyramid, right? But can’t this also be said of a new stock? The more people buy the faster the value of the stock increases, right?

One must realize, however, that as cryptocurrencies become more and more popular, they become more and more risky. They are not stocks. There are few barriers to entry and trades are nearly instant. There are few restrictions. You are free to lose and gain and panic. At least with stocks, you have a broker who earns very high commissions by comparison, and you can execute trades reasonably quickly, in most cases. Oh, and you have no privacy. Every transaction is logged for tax and regulatory purposes, to ensure that you are not being cheated. That never happens…

This new injection of funds into the cryptosphere, ostensibly from a broader base — regular people — and not simply from the brokerage houses that fueled the Dot-coms, serves to magnify the potential bubble. This is a given. If such a bubble bursts, the fallout could eclipse a standard market collapse…in the future. Not right now though. Which is why the heat is not all that hot.

Currently, the amount of money in the cryptocurrency system is peanuts compared to the banking sector. Sure, lawsuits and investigations happened after the Dot-coms, the housing bubble — after any number of market implosions. Bailouts are always an option for government to soften the blow of poor investment decisions. But when banks collapse, governments step in and the insurers pay up. Then the arrests come. Fines and Senate Hearings, when the circus comes to town.

Brokerage houses are known entities. The mortgage companies and banks are all around us. If bitcoin fails, the loss is real. It will hurt millions, but in the scheme of things, it will be very small. Currently, if all the cryptocurrencies listed on coinmarketcap here went to zero overnight, it would only be half as bad as the Washington Mutual insolvency in 2008. One bank compared to over 1000 cryptocurrencies.

Diversification:

Diversification may not help. One might be safer with a mutual fund or an ETF but not a cryptocurrency. Why? Because there are few, what I will call base-cryptocurrencies, bitcoin being one. When bitcoin drops in value, nearly all cryptocurrencies lose value. So, loses are often magnified. When bitcoin recovers, so do the others. Tether cryptocurrency is one exception. It usually hovers around one US dollar in value, but it has little upside. Conversely, if say Ripple (tm) devalues, bitcoin may not.

The tie-in with bitcoin and all other cryptocurrencies happens because it was a first comer and trusted. If you want other cryptocurrencies you will often need to trade for them using your bitcoin. If you want to convert back to fiat, it is often best to use bitcoin. This is changing, however. Other coins are slowly earning a type of base-currency status.

Anti-Money:

The Fallout:

What do you suspect will happen to the hundreds of international cryptocurrency market exchanges, when (and if) the bubble bursts? Do we even know where they are? How about the US based exchanges? Will their doors be closed, their assets frozen? Will your bitcoins be stuck in Europe or Asia? Will you keep your BTC at home on your hard-drive or some other device. Will cryptocurrency developers in the US then be shuffled off to prison?

How about the giant bitcoin mining farms in China and the world over? Shut off? Scrapped? Bitcoins Confiscated? What about the cryptocurrencies that do not use the ‘farms?’ The ones like Peercoin ™, which is essentially PC based?

What of the decentralized cryptocurrency exchanges that exist only between you an unknown parties over the internet? Will these applications be shut down and their unknown creators sought?

The fact that Amazon ™ lost 90% of it’s stock value over as many years, as Schiff indicated, is his example of what can happen to bitcoin. The nearly constant ICO’s (Initial Coin Offerings), the new cryptocurrencies popping up like so much graffiti, will not survive, even if they use the latest blockchain technology or some variant of it. There will be a saturation point, no doubt. Already, there is talk that if you are in “blockchain” (your company invests or develops this type of new tech) you don’t make any money.

Some companies can exist in the red for years, but at some point they must turn a profit or fail. The only other option is to ask for a loan. In any event, even Amazon ™ has not failed, but it has real products as well as software. (Bitcoin is software. An intangible asset.)

The Beginning of the End?

Flipping houses before the market imploded was all the rage before 2007. It still happens today, in Florida, where I live, but not nearly at the pace of a decade earlier. When friends quit their jobs back then, bought huge homes, new cars and lived the life, only to be financially destroyed later, it was rough. The house flippers paid the price. After the building boom things slowed and housing prices dropped. We can argue all day about how and why the crisis began. One thing is certain, however, irrational exuberance was the norm.

Is that beginning to happen with cryptocurrencies now? In a sense, flipping cryptocurrencies doesn’t really happen. You can’t buy one, improve it, unless you are the developer, sell it and walk away. You can however, buy one at the bottom, when it’s cheap, then trade it for bitcoin or Tether, when it increases in value. Unfortunately, the tax headaches in some countries makes this type of arbitrage unprofitable. If you ignore the taxes, you are chancing fines or worse.

But what of the P/E Ration? I mean, we can calculate the price to earnings ratio of a stock, but how would you do that with bitcoin? Can we ever know when and if it is overvalued? We can see when underlying government fiat money is devaluing by comparing it to something like gold. When more fiat buys less gold we have inflation or more correctly, currency devaluation. When less bitcoin buys more fiat dollars, what is occurring? Is bitcoin becoming more popular or is it acting like gold? Is it becoming like a peoples’ barometer of their own fiat money — worldwide?

The Aftermath?

After this cryptocurrency bubble bursts, if it does, what might remain? Cryptocurrencies which offer a type of service, like Ethereum ™? Ones that offer fiat trading via third parties, and other services, like Stellar ™? Newer models, such as Iota ™ or Neo ™? It’s your guess.

Worse case? Your country outlaws innovation or co-ops it, then slowly destroys it.

The best case scenario, for now? Bitcoin keeps growing and more nationalized fiat  currencies fail. The cryptosphere becomes indispensable, trusted by people everywhere, and nations begin to compete by adopting sound monetary policies.

In the meantime, don’t fall for the hype. Do your homework if you are curious about cryptocurrencies.

And a parting thought. At some point, technology will be able to create physical items upon demand. If we are then able to create gold by recombining atoms and molecules, an abundant resource nearly everywhere where we look, on the cheap, how will we then design a voluntary, sound monetary system?

 

Good Day,

Jack Shorebird.


 

 

Where there is smoke there is Iota?


An open letter to Cryptocurrency fans, that is not investment advice. Please speak to your parents before you plop down your hard won lunch money on crypto.

Where there is smoke there is Iota?

For the crypto-enthusiast Iota is nothing new. It’s another cryptocurrency, albeit, one with great new tech, we are advised. Some call it the Bitcoin Killer. A new type of coin altogether, with a blockchain and a “tangle” and a new way of reaching consensus — to validate transactions. It’ll reach a ten billion market cap in no time, some say.

I’m no developer. Not a programmer. I knew a little Basic and Fortran in the deep dark past. But I have spent many man-hour-years using the various crpytocurrency wallets, hardware miners, exchanges, services and so on. I’ve learned a lot, from losing a lot and gaining a little. I tried to keep up with all the news, ICO’s, premine scams, discussions and government blow back.

So, as a layman, which I think many a crpyto-enthusiast is or was or will be, I like to give my two cents and in the process make a few cents in ad money when you read this — and hopefully, as a noob, maybe save yourself a few bucks and harsh words from your wife when she asks you why you dumped all of her vacation cash into crypto. (Yep, you’re in trouble now.)

I used to get right in there with all the bloggers or Redditors — and I still do — and say how great this coin or that idea seemed to be. I had no intention of pumping, but if I felt good about the coin, I’d say it. If I felt bad, I’d sell, then say it — nicely at first. To hint at others that maybe this coin was not so great, and here’s why. If I read about a particular coin, saw that its website was clunky, dead, had a lot of spelling errors (with some exceptions here), looked cheesy, I’d not even invest.

Another thing is the Bitcointalk.org page. If the coin’s page was well thought out, clean, understandable, with a community of serious people, so much the better.  If it’s disorganized, errors are abundant or if the developer’s comments are abrasive, over the top and ridiculous, then I ditched the coin. And yes I know that many great minds are jerks on the outside. If so, then they’d best get a partner to smooth out the people wrinkles. That goes for broad based appeals to the general public and also getting the German government, for example, on board. In a recent Iota video, such a process was discussed. Grants from Uncle Germany? Doesn’t make me feel good. When you obtain grants, you gather strings.

And then, after the sales pitch, citing the great tangled tech, a very detailed Reddit Page, new tests are announced. Tests? Yes, I said tests. More tests. Why? Well, things need fixing. But don’t worry, if you can download a large file, a new wallet, if the repository is not too busy, install it and follow basic instructions (not easily located) you will be just fine. Why might you need to reinstall a wallet? Because of the upgrades. They are making things better for you, of course. They are going to have the machines talk to each other and probably take over the world. Not really. It’s just to speed things up, like for paying automobile tolls in Germany. I guess they don’t have Sunpass.

So, you realized you have the Iota web wallet, during these tests. Well, you made a mistake. You need that new download. So you download, follow the instructions, thinking what a bunch of amateurs these Iota people are, all the while. You install a basic new wallet, pull over your funds from your old “seed” thingy, get all sorted out, get your new seed, stash it in a safe place, bitch to yourself how long it is, the lengths (literally) you will go to secure your crypto, feel good about it, how smart your are, then the fan gets hit hard — if you are a US citizen.

Bitfinex, the only major exchange offering Iota trading has decided that Americans are too risky. Sounds like baloney, but they allegedly don’t want the heat. You read the Reddits. Read between the lines. All is well they say. Others say get the hell out of there. Oh crap, you think. I just got my stupid wallet fixed and now this?

So, you think about it for a day. Watch as Iota continues up, tops a few times and starts to drift. You think, well, you can stick it out or do some more due diligence. So you waste more time. Listen to German “Iota” youth talk about how they are now reformed gamers. Oh great, roof top talks with guys who sold game mods on the sly. Okay, okay — it’s fine. Could be another Bill Gates. But not likely. I don’t think Bill was gamer as much as a thinker.

You reminisce about the old days then, last month, when you finally decided to buy some Iota. All that reading. All those profanity laced audio broadcasts you listened to from the Iota guy. That’s what I call him, the Iota guy. But I think he’s just a product of the times. Profanity is common now. It’s becoming meaningless. It has no impact, which is what I think they are shooting for. I can’t imagine people investing in Microsoft ™ if Bill Gates walked out on stage and let go a stream of mouth puke. But that’s how it flies at Iota. Rough and tough. (Baloney.) More like bravado to take your eye of the money ball. The ball they want you to give them.

So, here I was, Iota in my wallet. I got rid of it. A little at first. Jetted it to Bitfinex. Traded it. Withdrew other coins I know aren’t so sloppy. Waited. It worked. I did the rest, slowly. Breaking it up in small chunks until I got down to some weird divisions, minuscule amounts of Iota’s in my wallet. I left them. I wanted to reach in my computer then and squeeze the little wallet, give it some human-to-app love, but what the hell.

I was out of Iota. Well, except for some parts of them. Some atomic units I sent to my cell phone as a test, which I am just too lazy to mess with now. Then I go back on Reddit, see all the community members, the sheep, singing the Iota song. I wish the herd luck, but for now, I’m almost Iota-less and I’m not staring into that Zombie Moon waiting for the rockets. I’m thinking more of a bomb at this point, but I’ve been wrong before.

Anyway, I feel better about being Iota poor.

Sincerely,

Jack Shorebird

 

 

 

 

 

Clif High

 


Hello, crypto enthusiasts. Thanks for stopping by again. This is just a quickie for tonight. I mean it’s night where I am — in Florida (United States). You Europeans are dead asleep by now, but hey, you’ll open your emails in the morning. And you Asian folk, you’re getting off of work about now. I’m not sure about you Aussies. You guys (and gals) are what, eating dinner and watching the news about North Korea? Guam on your minds?

As usual, I’ve been scanning the net for the scoops. Watching the markets for the fizz and pop. And here’s the latest curiosity I’ve managed to dig up from the fintech ether. And mind you, the people (person) I may cite herein may not have the cleanest resumes, but damned if they don’t get your spaz juices flowing.

Bitcoin and Ethereum seem to be in the keeping modes right now. Meaning they are looking great. Clif High, and he’s a bit of a, how can I say this nicely — an unusual chap? But I’m not one for killing the messenger, even if he is a bit burnt, if you catch my drift.

And that’s why I’ve been chomping at the bit today and yesterday. Kind of mulling this whole thing over. Trying to align my belief in a gold backed (silver backed) monetary system with the alleged future facts (and ideas) Clif High is constantly bringing to the table.

But I can’t really do it justice and I do not work for Clif. Don’t know him from Adam, as it were. Yet the guy is able to explain, in words and ideas — in a few seconds — to sort of encapsulate what many of us might think. How bitcoin (cryptocurrency) may, within the next 10 to 20 years, undo thousands of years of stagnant and centralized money control. How this new world of crpyto can serve as a shot-in-the-arm for economies, for wealth, technological development and so on. That, according to Clif, America (the U.S.) split from Great Britain when about 3% of the people wanted it. That only about 1% or less of people, now want bitcoin or cryptocurrency. That, if this margin reaches 10%, the governments of the world, which are always behind the times, will be unable to stop it. That, the iron is heating up and you may be able to make some serious cash, if you invest soon. That is what Clif is implying, I believe.

These are very positive statements in a lot of ways, in my book.

But, I hope that Clif’s inexplicable descriptions, his references to the unusual and seemingly unproven, are not, in some ways, infecting his ability to maintain his rationality. As far as I can see, his “predictions” have raised eyebrows for several years now. But are his prognostications simply too general? Too crazy?

He talks about silver prices skyrocketing — for a time.

Gold’s just sort of okay, as far I can judge by Clif’s statements.

New tech that will create matter from energy is only a few years away. So why mine gold or silver in say, 15 years?

Potential limited nuclear wars are on the horizon.

But by and large, the outlook is very positive, in Clif’s assessments.

He didn’t talk about my current favorite crypto’s though: Neo and Iota.

Please — you be the judge. Give this guy a listen. Tell me that he does not, in some weird way, make you very positive about the future of our world.

Here’s his latest talk. It’s long — a YouTube interview.

The Interview.


 

 

Will Bitcoin Fork on July 21, 2017?

Burn

 

Bitcoin has been steadily devaluing. In fact, most of the major cryptocurrencies on earth are also losing steam. Ethereum, Ripple, Litecoin, Steem, and even Dash are suffering. In some cases losses have exceeded 25% in less than a week.

Is it the end of an era or a readjustment period? A shakeout, if you will?

Many have debated why, as bitcoin dips, does it seem to initiate a larger scale downward trend throughout the cryptosphere. Each time bitcoin sneezes, crypto in general, catches a cold. Today — this week — bitcoin has the flu.

Some have pointed to alleged “Civil War” between the Bitcoin Core Team and the Bitcoin miners as the culprit. Primarily, the accusations are being leveled against the miners who control most of the network. The Chinese.

There is also some bickering within the Bitcore Core Team itself. But the idea that all of the planned changes — the proposed updates — to the code, will cause a rift is also on the debate table. A debate about a potential bitcoin fork — a split of its blockchain. Or perhaps users will use another blockchain. (I will get to that in a moment.)

Let’s face it, most bitcoin users, investors, watchers, writers — do not give a bleep about large conglomerates of miners who are churning out bitcoins and making a tidy profit. They are charging the community for the privilege of using a peer-to-peer system, allegedly designed to reduce the financial friction between willing parties. That is now history. The price of doing bitcoin business is becoming more expensive to the small consumer. Still, aside from the slow processing times, sending large amounts of bitcoin internationally, is cheaper than using the antiquated banking systems of today. In other words, bitcoin seems to be helping those with lots of bitcoin. Not a good sign.

Many of us do care that the Bitcoin Core Team is working to keep the code “bug-free” and that they are attempting to update the system. However, they are not dictators. They do not have the final say. The community must accept the updates. The users of the system are voluntary. If they do not accept the changes — if the miners feel cheated by the prospect of having their profits reduced — we could see a fork. And this could mean the destruction of the most successful private money that has ever existed — maybe.

Such a thing would not only evaporate the wealth housed within the blockchain, but potentially all of the investments tied to the bitcoin ecosystem — worldwide. From ATM’s in Vegas to the Mom and Pop Dress Shops in Morocco. All of that seed money, those start-ups, YouTube preachers — you name it. Adrift in the cosmos of bankruptcy. It would be painful for some.

Is there a silver lining to all of this?

Antpool, the largest bitcoin mining operation on earth, does not want the updates offered by Core — “SegWit.” Bitcoin Core is pushing ahead anyway. It is a Goliath versus Samson battle — all over again. Core holds the sling (the keys to the original code) but Antpool can simply copy the code. If the Antpool Goliath does this, will anyone trust him? Actually, the last I read — and info can be sketchy here — Antpool had a back-up plan. They started mining Bitcoin Unlimited a few months ago. (That’s another story, but suffice it to say it solves many of the problems associated with the current version of bitcoin.)

Philosophical battles aside, the concerns over whether bitcoin (or any cryptocurrency) must decide between the corporate world and somebody’s idea of traditional capital is a red herring. Any money ought to be neutral in that sense, if the developers/community so decide. And therein lies the problem. Any community of anything is going to debate, endlessly. Although, I am not speaking in support of Dash, their governance model does have advantages.

In any event, the fireworks begin in just a few days — July 21, 2017. If 80% of the bitcoin community adopts the updates — SegWit — all should be fine. On the other hand, if the community does not adopt the updates, it is likely that an alternative solution might be employed on August 1, 2017. That is the idea of a “soft fork” employing SegWit as user activated “choice.” By then, Antpool may be off the reservation — employing Bitcoin Unlimited. The tension is palpable.

Let’s add more fuel to that fire, shall we dear readers?

CNBC put out a panic article recently and it does have some rather prescient information. Namely, that the Bitcoin.org community has recommended that everyone — every user of bitcoin — take a “bank holiday” a few days before the proposed changes are to take place. Say on Friday, July 19, 2017 — you know — just to be on the safe side. Did you catch that? Turn off your bitcoin wallets. Now I’m as brave as the next guy, but don’t get between me and my cash. And yet, major players are notifying bitcoin users that they are doing just that. No deposits or withdrawals? No trading for a few days? Be prepared.

Do you know what happens during bank holidays? Panic. Users might find a substitute. Certainly trust will be eroded.

Hence, bitcoin is devaluing. People are cashing out. Waiting on the sidelines.

Now if you are confused, you should be. Hour by hour, bitcoin is still loosing ground. As of this writing, the price of one bitcoin just dropped below $2000, then popped up again. That is over a 30% value reduction in just over a month. Coming from just over $570 each last August (2016), which is amazing in itself, anyone holding the coin, if the blockchain forks, could be left holding thin air.

As some have put it, we are witnessing, once again, a sea of red. Let’s just hope that the entire thing does not go “bleeps up.”

You can check here for up to date valuations:

CryptoCurrency Market Capitalizations.

Thanks for reading. If you have any input, let me know in the comments section below.

(Oh, and thanks RK.)


Image: Flickr

 

Morgan Stanley…bitcoin…a poster child for speculation

It’s fashionable, right now, to bash Fintech — especially bitcoin. So get your blockchains while they are hot!

This is the latest on the banking/investment front. When bitcoin (BTC) loses value, the traditional financiers let it be known that it just will not work and, in all honesty, they might be right — in the long term. But so too will the US dollar devalue — probably sooner than we think — unless a rabbit is pulled from the proverbial hat, in the short term.

Bitcoin may be the reigning prima donna of the crypto market but Morgan Stanley is not impressed.

Source: Morgan Stanley thinks bitcoin is nothing more than a poster child for speculation – MarketWatch

In a nutshell, the Marketwatch article, by Reporter Sue Chang, at first tells us that bitcoin has soared by over 250% in the last year. “Great!” we say, but then she drops the bomb. She cites Morgan Stanley’s analysts and James Faucette in particular. Bitcoin is on a wild ride and it’s probably not a legitimate currency we learn. I guess that all depends upon how one defines legitimate, because nearly anything can be a currency — or as I have indicated in the past — “functional money.”

On the other hand and we need to face the music. There is, according to Faucette, virtually no merchant acceptance. Again, virtually is another one of those weasel words. And we are so surprised. Aren’t you surprised, dear reader?

Sure, I can’t buy a gallon of milk at the corner store with my BTC, but I can buy a TV or a chair or even bike, on Overstock.com. Microsoft, Virgin Galactic, Steam are other well known vendors and the list goes on. So are we really losing vendors? Yeah, probably. Okay then, why?

According to the article, bitcoin does not appeal to retailers — and that is one reason it is not so good. Let’s examine that objection. Why does bitcoin appeal to the country of Japan say, but not the local supermarket in New York City? Is it because we, as a nation are less technologically advanced? Probably not. Is it because the regulations in the United States, the tax laws, the trading laws, the money laundering laws — you name it. The short answer? It certainly puts the kibosh on the whole thing, does it not? Only the big players, such as Coinbase or Subway Sandwiches, with a bevy of lawyers and tax accounts, seem brave enough to wander into that quagmire. On the other hand, the small players and the hidden ones (not all criminals by the way) can also wade into that pond.

Hoarding was another objection. Sure, bitcoin has appreciated. People are holding it, but there is still a lot of BTC available. One can’t simply worry that there will only ever be approximately 21 million BTC’s in circulation. It would be like saying, if we put cash under our mattresses, hoarded large denomination fiat bills, we would somehow make it less usable. The thing is, there’s plenty of cash out there. Too much actually. In a manner, hoarding can serve to increase and stabilize bitcoin values.

The objection to bitcoin’s accelerating costs and slowing transactions time is a legitimate concern, however. We will know, probably within the next 30 to 60 days, if bitcoin will adopt new perimeters allowing for faster confirmations, but the applications — the coding — is still being hashed-out. And there are associated centralization of power risks as well. Only a few developers control the code, but don’t forget, anyone can copy (clone)  the code and “improve” it.

Surprisingly, the apparent objection that bitcoin’s own skyrocketing — I would say its volatility — worth, is somehow a minus, is ludicrous. Speculators are certainly present, but as I have submitted, the fact that regulators stand in bitcoin’s way, is the primary culprit. The Great American Regulatory Wall, against mass adoption — that it the goblin.

Government oversight is needed, they say. And that, my friends, is the big snow-job. It is not required at all. The real reason bitcoin cannot, in this environment, ever be allowed to function unhindered is that it threatens the dollar. It threatens all fiat currencies in existence. That is plain. When a digital currency, not printed into oblivion does that, no debt-based economy can abide it. Even Japan, mired in its eternal economic crises, probably hopes that cryptocurrencies can save their century.

Is bitcoin funny money? That’s another implied objection and it’s an ignorant one at best. If so, then the dollar is funny money. A reserve note that represents a slowly failing — bankrupt system. Most intelligent people know this already. We just have little choice. We are required, by law, to use this debt based system. Is it moral to force people to use a monetary system that has no real value? Even less of a perceived value than bitcoin? That’s a no brainer, right?

Morgan Stanley is the sixth largest bank in the United States. Banks take our fiat dollar deposits and create more fiat dollars — out of thin air. Now I’m not against honest banking services, where money is real — like gold and silver — and where fractional reserves are quaint memories, but to attempt stay the high road in a FED-made swamp? What magic is this? Answer? The emperor is naked.

And finally, we the people also know, us speculators and hoarders alike, that bitcoin could fail. The blockchain tech might fork. China might continue to build BTC mining farms and essentially own the network.  But, my Morgan Stanley late-comers, the Fintech field is just getting started. I’d keep an eye on the Fintech start-ups and the giant Cloud Servers owned not by the banking system, if I were you.

I’d hate to know what they think about Monero or Aeon. Kind of reminds me when the car replaced the horse. Many objected back then. It was certainly a learning curve.

Thanks for reading. Let me know if I bored the hell out of you.

 


Image: Wikimedia

Bytecoin: The DStrange Con?

Money Drain

Money Drain

If you need to boost your customer base, sell more goods — more crypto — what do you do? Hire a “PR” guy, right? Or pretend to hire one. I mean, on the internet one can create any number of what are called “sock puppet” accounts. Additional emails and user names for various social networking websites to make it appear as if many people are behind the scenes — hiding in the deep dark web — working hard to make things happen.

A bit of Bytecoin history that might be fiction is in order to help us understand the Bytecoin outlook. A short re-hash. In any event, in makes for a good story. The personalities in this space are colorful, but think of cardboard cutouts. Think of characters in a book — a book of fiction. Think about keeping your money while you are at it. Even if the Chinese own Bitcoin, maybe you’d better just wait and see.

I have often wondered what it is that has brought me here to the Bytecoin.org doorstep. It’s the mystery of course. The not knowing. It bothers me. And maybe that’s the lure or the pull, if you will. Is it a marketing method? No, I doubt that. I doubt that all of the mystery surrounding Bytecoin is meant to make us feel protected — secure in our monies. Our crypto. No matter how great the code may be, there are simply too many red flags to ignore.

The mystery is what it is. A lack of information which has led to multiple inquires going back since at least 2012. Now ask yourself what kind of people do not want you to obtain information about them? Are they the crypto-saviors or just the opposite? Scammers — criminals — or at the very least unethical developers bent on fast profits and a slow exit?

The point is, when some of us smell a rat or a bunch of them — even if they are living in a palace of fantastic code-cheese (that’s a slight reference to “Cheesus” — a mod on the Bytecoin Forum as well as BitcoinTalk) — well, we investigate. And I may have praised certain aspects of BCN in the past, but now is the season — once again — to hunt. To hunt and to make crypto-enthusiasts aware that scammers are alive and feasting — have been — for years in this Wild West environment. An environment where cheap cryptos entice the buyers, who only later discover that the shear number of BCN coins prevents any giant pumps. And that is just as well, since quick profits are just as easy to come by as quick losses.

Take DStrange. A character. A fiction? Yet another pseudonymous ghost. A Bytecoin promoter — who rarely promotes. You’ll find him listed under the Teto-Team at Bytecoin.org. He is a recent member, allegedly. Meaning he came after the rest of them. If you peruse the Bitcointalk forums you will find a trove of information which dovetails with the Bytecoin developers, going back to 2014. You will find argument after argument, accusations fly — and always the Bytecoin Team loses. DStrange loses. Rias loses. Cheesus loses. They are never able to explain why they — or Bytecoin — chose certain “dark” paths. Why Bytecoin essentially made the lion’s share of the coins for themselves, under optimal conditions.

Why is DStrange so curious, however? Because few people have ever had any contact with the Bytecoin Team. There’s a load of theories and maybe I will explore some in the future, but for now I’d like to focus on DStrange. Apparently, if you have questions, he might help. Maybe Cheesus will too. Praise the Lord! If he is still around.

We can see on the Bytecoin.org website — if true — that DStrange is a public relations guy with a major in Management / Psychology. He has a Master’s Degree in Management, from Erasmus University in Rotterdam — in Europe.  Rotterdam is in the Netherlands, for those who may not know. And all of this is “academic” as they say. Why? Again, DStrange is not likely David Miller — and he probably never attended Erasmus. Naturally, if I’m wrong, please — oh please — correct me. Show me the evidence and the error of my ways; and I will retract these accusatory words.

DStrange recently joined the team in a high action. Besides public relations DStrange develops further Bytecoin applications for business.

This is what Bytecoin.org offers us by way of a short bio — regarding DStrange. We can see that not only is DStrange a public relations guy, but he is also a developer of Bytecoin applications. Again, we must take this on faith. Oh, and ask politely for a single example of an application created by DStrange. Just one.

If we go back to the BitcoinTalk Forum to May 16, 2014, we can find an exchange between DStrange, who is also listed as David Miller, with an email address of Dstrange.m@gmail.com — and the Bytecoin Team. If you check the email address of DStrange on this verification service, you will see that DStrange’s Trust Score is 7.25. By comparison, my Trust Score for my email address (jgshorebird@gmail.com) on the same service, is only 5.5. Maybe it’s because this is not my primary email address.

DStrange’s trust score is much worse on BitcoinTalk, however. User fluffypony (Riccardo Spagni) of Monero fame, has even linked the user rethink-your-strategy’s post detailing the Bytecoin scam. (Warning: the writer is pissed.)

At any rate, DStrange is one of the few people who will actually answer the phone, so to speak. I’ve confirmed that at least he does respond on Reddit. His user name there is DStrangeM — again, if it’s not a sock puppet account.

At this point, if DStrange ever reads this blog, I’d like to ask him to tell me if he lives in the Netherlands (Holland?). It is interesting that ScamAdviser.com gives us a 2% chance that the Bytecoin.org website is in the Netherlands. Is that a result of DStrange’s influence? Or is Bytecoin hidden there?

Smooth (developer at Monero and AEON) — a well known and respected user on the BitcoinTalk Forum and many others — has leveled many allegations against DStrange and other Bytecoin Team members. And against the early code itself. One important factor was addressed on May 17, 2014, as DStrange and others were posting in support of Bytecoin.

Smooth posted:

The “optimizations” are fairly absurd. They are better described as de-un-optimizations. The straightforward implementation of the algorithm is the optimized one, not the other way around. You’d have to go out of your way to make it as slow as it was. Several highly qualified people have commented along these lines already (ignore me, I don’t know what I’m talking about).

If we look at the latest round of de-un-optimizations, most of the history of the bytecoin premine comes down to just 4-8 PCs. Or a somewhat larger number over a shorter period of time. Really, that’s all.

This one post by Smooth (above) is perhaps the most challenging for the Bytecoin team to explain. Why would they “de-un-optimize?” Logically, to grab the lion’s share of BCN early on. Is that a bad thing? I mean it was their baby, right? Now think about that for a moment. If they used the extra money to develop the coin, since the price has surged of late — probably just speculators — then they could have plowed some of it back into R&D, right? Has the money ended up in the Cayman Islands or Panama instead? We don’t know. Why? They don’t talk much and when they do — they do not ever appear to defend themselves from all of the accusations. They have, as Americans put it:

Refused to incriminate themselves in any public way.

And the history of a thing cannot be undone. It has been years, but no reliable information has surfaced about Bytecoin (BCN). It has, in no uncertain terms, staunchly refused to explain all of the inconsistencies related to the launch of Bytecoin — the premine, the apparent falsified White Papers, the assertion that the “blockchain” verifies the launch date — and the list goes on. Until that time, until Bytecoin can remove the stench from it’s hidden launch, I might continue to regurgitate these forgotten memories in an effort to dissuade or at the very least, to make users extremely cautious about BCN.

It’s high time Bytecoin Team. If you have any guts, show us the money.

 


Image: Flickr