Fidelity CEO Abigail Johnson says the company is mining cryptocurrencies
techcrunch.com
techcrunch.com
Every crypto article makes the same vague claims about the potential of non-specific blockchain technology. I'm surprised there was no mention of replacing Visa in this one as well.
With Ripple, realtime clearing and settlement happens automatically even between currencies. If my bank and the vendors bank both use ripple, I can use USD to pay the vendor EUR in real time, and the transaction completes in seconds.
The chief value in blockchain seems to be in getting people to agree to do something at all.
Yes... as far as I'm aware, most (all?) other non-blockchain distributed ledgers require complete trust between parties. Its hard enough for two banks to trust each other completely, let alone all banks to trust all other banks. The old way of doing things is to either trust a central bank completely, which is easier to do, but far from distributed, or to trust a third party with a days worth of transfers and settling at the end of the day. Still not distributed, but requires less trust.
> The chief value in blockchain seems to be in getting people to agree to do something at all.
Exactly!
Blockchain technology is essentially nothing more than a cryptographically secure distributed ledger. There's probably other ways of having a secured distributed ledger without technically being a blockchain, and I'd be interested in hearing about them, but I'm not aware of their existence at the moment. Either way, I'm not sure why there's so much pushback on blockchains?
Doesn't it just require trust of a single party for settlements (or any number of independent settlements parties)? Which you still sort of require in the ripple model because ripple owns a crap ton of it's own coinage (60% of the pot).
If you're talking about two banks... There are thousands of banks out there all with varying levels of trust, and those banks all need to transfer funds between each other on a daily basis. Most banks only have direct relationships with a handful of other banks.
> Which you still sort of require in the ripple model because ripple owns a crap ton of it's own coinage (60% of the pot).
Yes, they own 60% of XRP available, but if you're settling a transfer between USD/EUR then you only need to trust ripple for the length of time for that settlement to happen.
Which for a bank would be all the damn day because they wouldn't just be doing one transaction every 2 months.
I know for a fact that Bitcoin's transaction time is not "real time," so why would Ripple's be?
Ripple doesn't use proof of work, it relies on a web of trust. So, in order to transfer money from Bank A to Bank B, it relies on Bank A to have some path to Bank B that is trusted. If Bank A and Bank B don't trust each other, but both trust Bank C, then the money is routed through Bank C.
Not sure what you mean by identity verification, if you're talking about for the customers, then they'd still need to have their identity verified at the bank (for purposes of Ripple, a bank is a ripple Gateway, but not all gateways are banks). Honestly, I'm an armchair expert in money transfer systems -- pretty familiar with Ripple, but less familiar with other systems.
I can forgive all the business guys for that thinking given articles like these, but the tech guys who were fanning the fires of that fantasy and telling me I didn't understand blockchain....
I got the distinct impression that there is a growing cottage industry of tech consultants and outsource companies that realize that if they can get their clients to "do it on the blockchain" they will be able to bill 10x as much for a project that has a current very good solution (and relatively fast to implement solution). And for which blockchain won't be a benefit. But the client may very well be able to get more VC money, so it's starting to turn blockchain 'skeptics' into martyrs.
And the most frustrating thing is that the innovation in Satoshi's paper (bringing together in a unique way prior known solutions) is really exciting and there are very good uses for blockchain. The international shipping companies using blockchain to track shipping container provenance strikes me as really, really perfect.
The bad uses of blockchain is going to kill the tech before it's had time to mature naturally and find its place.
As someone who has been involved in blockchain research since 2011, it’s sad to see a promising technology (in limited use cases) turn into a buzzword thrown around by the many speculators and scam artists peddling vaporware and pumping crypto prices.
http://www.gartner.com/smarterwithgartner/top-trends-in-the-...
Executives want to apply Deep Learning to everything and anything they can get their hands on. The results most of the time are underwhelming and could be had with a much simpler set of tools. Just wondering how long before Deep Learning goes into trough of disillusionment.
One day a consultant or another yesman will be able to check in and syphon precious resources with their pipe dream and I’ll watch six figures fly out of the window while my dev team struggles debugging simulated ipads with mac minis.
Six figures? Oh sweet summer child. :)
First you'll need to burn seven figures to have a Big 3 advise your leadership that you need this tech. Then you burn the six figures implementing it with a lower tier firm.
My WotD
Got a simple, defined flow that could just be a decision tree? Nope, we need natural language processing in a chatbot, we can't possibly present a menu.
I feel like I'm fighting the Infocom parser again.
I still remember my manager getting very excited about XBRL in 2007.
The same thing happened to REST. Every "web interface" is supposedly REST now, yet the client and server are even more coupled than they would have been if the interface were implemented in SOAP!
The client-stateless-server style derives from client-server with the additional constraint that no session state is allowed on the server component. Each request from client to server must contain all of the information necessary to understand the request, and cannot take advantage of any stored context on the server. Session state is kept entirely on the client
I've heard enough verbal gymnastics to fill a book trying to excuse how modern web apps aren't violating this condition.
Maersk is using it for something as boring as secure claims for containers to fight corruption in shipping.
In government we're looking into running things like the land ownership registry and other public records on the tech. Not because it's hip, but because it'll save employee resources when we have to perform less audits, and because it'll speed response times.
"The research to date leads to the following conclusions: A blockchain title recording system is the future of title record keeping and would provide immediate benefits over the current title recording system, with additional benefits accruing in the future as blockchain technology grows in acceptance. However, at the moment, these benefits do not yet outweigh the costs and challenges associated with implementing a prototype blockchain title registry system in Davidson County, or elsewhere in the country. That being said, steps can, and should be taken now to lay the foundation for a blockchain system."
dci.mit.edu/assets/papers/spielman_thesis.pdfdci.mit.edu/assets/papers/spielman_thesis.pdf
Avi Spielman, in "Blockchain: Digitally Rebuilding the Real Estate Industry" does a terrific job addressing and exploring "aspect(s)- recording property titles- by comparing the benefits and limitations of a blockchain with those of the current record keeping system."
dci.mit.edu/assets/papers/spielman_thesis.pdfdci.mit.edu/assets/papers/spielman_thesis.pdf
Now why would a major financial entity want you to think external decentralized technologies are scams, and their in-house solution is fine and legitimate and secure.
They did it with 3D printing, they did it with VR, and now they're doing it with blockchain.
And there’s still the risk of a crash and switch in that long of a timeframe.
I bet there’s more money to be had at cryptocurrency arbitrage
For a "parcel" of goods, I counted 17 paper copies of the same shipping form, being sent to and fro. Back then IATA also used a custom text field format instead of a standard XML format I think they use now.
So while this was a long time ago, I too expect shipping to be fraught with lots of weird edge cases.
This is exactly what many with a cursory knowledge seem to think a blockchain will solve. Unfortunately, these are generally challenges people have to talk about and resolve via mutual agreement and compromise; you can't simply throw code at the issue.
Is provenance in general a good usecase? e.g. chain of custody for evidence / drug testing / food labelling?
This is not to say that ideas behind consensus, security, and smart contracts are not useful but you need to start with a concrete problem instead of adapting a fixed solution.
Having said this, it is interesting to explore a pluggable way to make agreements between parties and follow defined workflows for interoperability. The main barrier with implementing this idea is not technical but political since it is difficult to create agreements about this architecture between companies (e.g. banks).
Like you say, there are some incredibly innovative uses for the blockchain (another excellent one is claiming and tracking digital works of art like visual arts and music), but using the blockchain as a simple database replacement is ludicrous.
It represents the smallest fraction of 1 bitcoin you can use as an amount in a transaction, so they are the smallest (indivisible) units.
It's not really an important distinction, but maybe someone will find the history interesting.
http://groups.csail.mit.edu/mac/classes/6.805/articles/money...
(and OP seems factually correct: Satoshi was the inventor of Bitcoin).
Proof-of-work schemes like hashcash and bitgold are much closer to hitting on the central ideas that led to Bitcoin. It's like crediting Democritus with atomic theory -- yes, he's talking about the same thing, but in such a way that the final realization is so different as to be unrecognizable.
And it's not really a decimal; it's more properly "1 bitcoin" in the technical sense. 1BTC was later defined to be equal to 10^8 Satoshis because that seemed like a useful amount of money to track exchange rates for (though now it's about 10^4 too high.)
I'm sure OP knows this, I'm just being pedantic.
Buterin couldn't possibly have made it more complicated.
The surprising part for me was that, as a corollary to that, wallets with less than that amount have bitcoin in them which is potentially permanently removed from the total supply of BTC.
a lot of trading is quoted in satoshis instead of "x thousandth fractions of a bitcoin"
That being said, I also had a great laugh reading the article when it came to "200,000 satoshis". Although I totally believe her - it's hard to earn significant amounts of BTC via mining today without investing huge amounts of money and dealing with constricted ASIC supplies, so you need to have time and cash to blow at it. But she shouldn't have mentioned that number in the context of "yeah, our mining ops suddenly started to generate huge returns".
Most of the exchanges shut down their chat rooms but thats where it is mostly said, and other real time trading arenas where people talk. People say 200k/sat while reading .000200000 btc
but a satoshi also works in other quotes where other cryptocurrencies are the base unit as well. In an XMR/ETH market, the XMR would be quoted in X eth-sat or ethereum satoshis.
The GUIs use a variety of different metric base units and there is no agreement on the GUIs, that has nothing to do with the terms people use in speech, as they don't say "x thousandth of a bitcoin"
(Though Vanguard is probably still a better choice regardless.)
Additionally, Fidelity offers index funds at a lower cost than Vanguard: https://www.fidelity.com/mutual-funds/investing-ideas/index-...
Also, Fidelity's index funds are loss leaders to retain funds that were flowing out to Vanguard.
That's irrelevant if they those gains are less than a competitor's discounts.
> Also, Fidelity's index funds are loss leaders to retain funds that were flowing out to Vanguard.
So?
Loss leaders are by their nature unprofitable and thus will go away as soon as they're not required.
Suppose if Vanguard disappears, then Fidelity will hike their rates up.
On the other hand, if Fidelity disappears, Vanguard won't hike their rates up because they won't bite the hand that feeds them since it's their own hand.
https://www.forbes.com/sites/greatspeculations/2015/01/13/re...
[1] https://www.bloomberg.com/news/articles/2016-12-02/fidelity-...
> If Vanguard's index funds are run at-cost, then how does Fidelity make by undercutting Vanguard's rates?
https://www.reddit.com/r/investing/comments/62fbk9/if_vangua...
https://www.fidelity.com/mutual-funds/investing-ideas/index-...
http://www.ft.com/cms/s/0/6663cd8c-410d-11e6-9b66-0712b3873a...
So yes, fidelity may not mix the two, but Fidelity is "losing focus" in their eyes.
https://personal.vanguard.com/us/insights/article/active-fun...
- How well the fund is run, and how representative it is of the index. A fund with high trading costs may underperform.
- Securities Lending policy, how risky it is and how much of the income is returned to the fund
- (In taxable accounts) Tax efficiency. Some funds from some vendors return a significant amount of capital gains and short-term dividends, which can cost several basis points in taxes a year.
In general, the first two elements can be approximated by comparing the performance of the fund to its benchmark over the same time period, and tax efficiency can be estimated by looking at details of past distributions.
In most cases, it wouldn't make sense to switch existing funds to another provider in a taxable account if switching would result in a large capital gain.
I'd expect all providers to get better at indexing over time and their performance after taxes to converge.
>In most cases, it wouldn't make sense to switch existing funds to another provider in a taxable account if switching would result in a large capital gain.
As long as the the funds track the same index then it's a Section 1031 like-kind exchange which does not trigger capital gains.
[0] https://www.irs.gov/newsroom/like-kind-exchanges-under-irc-c...
Inventory or stock in trade Stocks, bonds, or notes Other securities or debt Partnership interests Certificates of trust"
Without the service, there is nothing.
Mining provides economic cost of reorg as a product, something people in the bitcoin space call "security."
> running a service
i don't know how to put it for you mate.. service can be a product? you know, like this site where people friend each other and share shit nobody cares about, what's it called.. facebook?
Minting algorithms have mostly generated the majority of the entire supply in the first few months, allowing anyone with existing capital to purchase majority stakes or mining power.
Shameless plug, if you want to mine on nicehash using Linux, you can try https://github.com/hossbeast/autominer
You can connect to hubs that auto switch the mining algorithm to the most profitable one at the time.
Surprised it’s cost effective to mine with commodity desktops and retail power though. ;-)
It’s not as decentralized as he/they hoped??
Artificial and delusional scarcity of software derived database entries, of which a multitude of newer alternative service networks are being created every day?
- All Bitcoin: ~500%
- Mix of top market: ~2800%
- All Strat: ~13500%
Meanwhile, stock investors call 12% a good year.
The crypto market is still niche. There are stocks that make 100-1000% performance. But the stock market is "saturated" for representing assets, equities and companies. So its growth is limited.
> The crypto market is still niche. There are stocks that make 100-1000% performance. But the stock market is "saturated" for representing assets, equities and companies. So its growth is limited.
so I do not see how my post was wrong. These are the numbers. With such numbers, it would be foolish to discard the crypto market as "too volatile" and stick with stocks.
There are crypto coins that did way better than Strat, but there was not enough volume to make a decent profit. Even Doge did 260%. The only "loser" is STEEM with a 80% ROI.
People/companies that are able to understand and accept the risk that comes from speculating on cryptocurrencies should consider doing so, because it is possible to make a profit, perhaps a significant one.
But if you're looking at the past and saying "wow, I should buy BTC because it made 1000% last year - it can't lose!" then you're ignoring a quite serious risk that volatile growth could change into volatile collapse in the future.
Traders don't look for "potential growth". In their frame of reference, that potential of growth is already "priced in".
Now if you disagree with that, it is another story.
Edit: replied to the wrong guy.
That way you can get potentially huge gains with little at risk.
They also have very high Sharpe ratios (the ratio between returns and volatility), though given crypto's short history we shouldn't trust that too much.
But should this stop you (or any investment firm) to seriously look at the profit potential here? What do you get for correctly calling the bubble in 3 years? Nothing.
Well, if you knew when the bubble was bursting, then there would be no problem!
Then someone says: "Look I told you so, I've been telling everyone for 2000 days now: This slot machine will crash one day!". And you say: "Ok. You were right. Guess the party couldn't last forever. Thanks for the warning!". Out of habit you play for 30 more days, but the rewards stay gone, so you exit with some nice profit.
Meanwhile, the other person knew of the existence of a highly profitable slot machine, while it was still profitable, but never actually played it, because they feared that one day it may not be profitable anymore.
Your example only works if you are regularly selling BTC as its worth increases. If you're just holding onto it, your gains are never realized.
But the downside of performing so well is that it is too easy to get distracted by the price and disregard the radical improvements that Bitcoin brings over legacy financial systems...
Besides, almost no one who buys a lottery ticket ends up winning millions, but everyone who bought and held bitcoins since 2010 is a winner.
So where are the 'winnings' of these magical 2010-era bitcoin holders coming from, if not from other people buying bitcoins?
There are equities that are up triple digits, including Nvidia...who is realistically the biggest winner in crypto mining.
Wrong. 1.5+ BILLION dollars' worth of bitcoins are sold and bought in aggregate daily on 100+ exchanges: https://coinmarketcap.com/currencies/bitcoin/#markets
It is. But that's not what partiallypro and I were discussing. We argued about whether selling "millions" would crash BTC or not.
«He's totally right»
Did you even read the link I posted? Even if you look at only the BTC/USD pair, $10M represents merely ~1% of the volume sold DAILY on the top 6 exchanges (~$800M). You would probably need to sell an order of magnitude more, so $100M, in a single day, to start affecting the markets significantly.
It's so small you have individual holders the community now calls whales who can individually manipulate the price with buy and sell walls; no individual can do anything remotely like that in the FX market. One because they don't have enough money, and two because such market manipulation is illegal.
You'd need to spread your purchase or sale out over the day to avoid massive slippage for an order that big because there just isn't enough liquidity to absorb it without the moving the price. 10 mill is about 2500 coins, go look at the order book on any exchange, a purchase that large is going to massively move the price, looks to be possibly 300-400 dollars you'd move the market with that one order. 50 million would certainly crash/bubble the market.
The OP mentioned selling in a day, not at once: «I doubt you could liquidate millions of dollars of bitcoin IN A DAY...» This is what I commented on.
You changed the topic and started talking about selling all at once, which would of course eat a bunch of bids. However even doing this wouldn't "crash the market." The order books are deeper than you think. It's hard to find examples, because it's plain dumb to market-sell this much in one order. But I found a ~1150 BTC sell on Bitstamp around 3pm on September 13 and it barely moved the price: https://bitcoincharts.com/charts/bitstampUSD#rg5zig1-minzczs...
It would eat even lower bids on exchanges with less volume/thinner books, but still wouldn't crash the market. For example some idiot sold 1200 BTC in two market-sells of 600 BTC each, 30min apart yesterday on Gemini; and although it ate all the bids from $4100 to $3400, twice!, it didn't "crash the market". Other exchanges didn't react. Subsequent trades resumed exactly where the price was before ($4100).
Some people told me that I'm confusing good investment decisions with high volatility ones, but what do they know? They're just stupid investors! /s