Actually, it does need to be repeated, because economists and their opinions and their "evidence" are being given too much credit by politicians and laypeople.
290 karma · joined July 14, 2017
A timestamped, immutable blockchain would be useful for reviewing credentials from 3rd world countries where qualifications/experience/government certification are all able to be bought. It wouldn't solve fraud, but it would make it a lot harder to suddenly decide to fake a whole lot of credentials, and would make it more obvious that a particular organization is corrupt and therefore would incentivize not being corrupt.
The central question for whether blockchains are indicated for a particular use case continues to be "does this require immutability, regulation resistance, or cooperation across various regimes that don't trust each other".
An example of useful blockchain identity would be in refugee verification/processing: - people in 3rd world countries scan a fingerprint and hash an encrypted version on the blockchain when young - annually update information about themselves onto the blockchain including info about families - 10 years down the line they have an excellent record of who they are, who their family is, what their situation is, and they become far more credible when it comes to identity verification that relying on documentation from a long-toppled government
1) If the value of the individual damages related to this breach are in excess of the market cap of the equifax company, all company stock should be seized and distributed equally among those affected by the breach.
2) In the future, if a company controls this amount of sensitive data, they should have mandatory breach insurance. This means that they are covered for a government mandated amount based on the legal liability if all their data was lost. This will mean that the insurers will do in-depth audits of the data security of the company, and they will be incentivized year-to-year to ensure their security practices are top notch. The present system incentivizes each CEO to have a head-in-the-sand approach to data security where a hack is considered a long-tail event unlikely to happen during the ceo's 3-5 year tenure and therefore is not really worth paying attention to. In addition, it would ensure that if the potential damage done if data is leaked far exceeds the value of the business storing the data, the insurance will be prohibitively expensive and the company will not be able to continue with this line of business - as it should be.
I remember as a medical student on placement asking a palliative care physician about whether they had considered the use of MDMA in end of life care to provide dying people and their families with a potential method of spending some really incredible time together. She scoffed at the idea and continued prescribing the same old crap. 10 years later psychiatrists are saying the currently MDMA, ketamine and the psychedelics are providing the most exciting breakthroughs in modern psychiatric drugs in decades.
It's not that they raise far too much money for their projects (although they do), its just that without equity in the company performing the ICO you simply don't get alignment of incentives.
Guys like Juan Benet talk about this utopian fantasy of coins funding open-source protocols, but think about the reality. A legitimate project raises 15-45million dollars with a stated intention. Even being well funded, it is still highly speculative, and most startups "fail". So the team raising money has 2 options. Spend the entire amount trying to get the protocol going - which will probably fail (as most projects do), or have a half-hearted go at getting the protocol going, and keep the rest of the money - a 100% chance of getting comfortably rich, but further decreasing the already small odds of the project succeeding.
If the protocol/token model is so good, then companies can launch a token and use that to feed profits back to equity-holders. There is no reason why investors should have to take their chances on some made-up instrument that puts an extra barrier between their interests and those of the founding company.
The ICO market may be bubbly and ridiculous, but at least it will make founders consider an alternative to traditional VC which may give more money for less equity.
Bitcoin made currency decentralised and permissionless.
Ethereum has made capital raising and equity holding decentralised and permissionless. Sure, lots of people talk about SEC compliance, but in reality anyone can raise equity for anything now. You can issue a token to fund for a drugmarket if you wish, and pay dividends, and noone can stop you really. The market cap of ethereum is 22 billion.. is that to high or too low for the promise of permissionless securities?
In the first 24 hours in which preregistered participants were eligible to buy equal amounts of tokens only 20% was sold. Now, almost at the end of day 2 during which contributions have been uncapped, around 60% of the total has sold.
Compared to other ICOs where they sell out within a minute or two, or where whitelisted participants snap up 75% on day 1, this is pretty slow. I think it probably won't reach the 75 million cap.
Here is why I didn't get involved: 1) They presold $50million tokens to polychain capital, pantera capital and blockchain capital at a 30% discount very recently. 1/2 of these tokens had no freeze and could be dumped on the market at any time. Polychain capital has already shown that they are willing to dump large amounts of tokens within days of an ICO if the price is right last month with 0x project.
2) They are offering 1 trillion tokens but minting 10 trillion, allowing them to basically dictate monetary policy. One of their employees even posted on twitter that they don't want "too much" price appreciation, and if it occurs they would intervene in the market (eg. dump more tokens into the market).
Come on. If you want me to buy your made up, meaningless, nothing token, don't take the piss by selling it at a massive discount to hedge fund dumpers, and don't tell me that you're going to control the price. If I'm going to take a dumb risk, and it is a dumb risk, I want the possibility of some upside.
I think permissionless offering and trading of securities is the killer app for ethereum.
Although I think all this highlights the massive unmet need for high risk investment vehicles. The stock market has become huge, slow moving and boring, where the already-rich make slow gains on top of their existing fortunes. The only companies that bother to IPO anymore are basically pump and dump crap (blue apron, snapchat). Private equity and VCs are snatching all the action for themselves. Why the hell can't I invest in uber? I would take less equity and provide more capital than all their current investors.
The ethereum network now provides everything we need to offer and trade equity - etherdelta has shown that decentralized exchanges based on the ethereum network work. So this really can't be stopped now. It may not occur in USA or China's jurisdiction, but its going to keep happening.
The Nobel prize for economics is not a real nobel prize
quote of the century - post-trump election in hillary clinton "democrat" voice: "i MAY not be DALE Earnhardt but I SMASHED into the FUCKING WALL because I couldn't turn LEFT"
utterly terrible idea. I was in india in Dec/Jan and the amount of chaos resulting from demonetisation was immense. The outcome was obvious - noone was ever going to let a high value bank note become obsolete. Worst case is you sell it for close to face value and some poor person stands in line for 6 hours to be able to deposit it.
It really speaks to the masochistic nature of the indian people that despite the whole exercise being pointless and stupid, they still supported Modi here because his heart was in the right place. Sorry but when people were literally dying as a result of the chaos, having good intentions does not cut it.
For me, one of the best things about bitcoin is that it is actually going allow a lot of arrogant economic dogma to finally be put to the test, including that:
- currencies must be inflationary or the universe will explode and people will save so aggressively that they will die of hunger
- printing free money and giving it to rich banks is a good thing and doesn't totally fuck the little guy
- monetary stimulus smooths out economic cycles, and totally isn't part of the cause of the ridiculous boom-bust cycles we are having now
How was the QE performed? Basically printing piles of money and giving it to banks. What have the banks done? Double or triple the value of every equity market. Hardly any of the money ended up in the pockets of regular people buying groceries and petrol. Yet our measures of inflation come from consumer goods, not equity markets. Is it any wonder that our bullshit measures of inflation have barely budged.
I think the coming bust (whenever it occurs) will be the last boom/bust cycle in which this shit flies anymore. We now, finally, have universal, non-inflationary currency of a type which can compete with the unproven conjecture of Keynesian economists. People have been complaining that about economic theories being hard to prove, well here is a battle between the old dogma and a new challenger.
http://www.econtalk.org/archives/2017/01/michael_munger_3.ht...
I think one of the biggest flaws of capitalism is the assumption that those are the bottom of the pile are rational economic actors, when in fact they often have factors like substance abuse problems, low iq, disability, miserable abusive upbringings, etc which prevent them from making smart decisions or functioning at the level required to get ahead in a competitive capitalist system. We can afford to, and are morally obligated to look after them. A starter UBI is a great way to do that. It also opens the door for employers to pay these people low wages, which can help them get a leg up in the job market, without risking losing benefits. Eg. a really low intelligence person sweeping floors for $2.50 an hour is moral when they get a reasonable UBI & if taxation of corporations and wealthy individuals means they get healthcare and education for their kids etc.
So overall, socialism for the people at the bottom of society, and capitalism for the people with a high enough level of function to be able to thrive under that system.
Given that bitcoin has a hard-coded cap of 21 million coins, if bitcoin became a reserve currency of the importance the USD currently has, you could assume it would reach a market cap of 12 trillion, meaning each bitcoin will be worth $570000.
The reason the USD value has not spiraled to $5000 each is because the economists advising the government believe in inflationary currencies, and believe for some reason that the best thing for a currency to do is to devalue by 1-2% each year. They give some reasons for this which, like a lot of economics are driven by conjecture and not evidence-based. Money is printed approximately to achieve this target, however in recent years, 4 trillion dollars has been printed and given to banks, again based on very little other than economic conjecture. I'm not going to argue with proponents of this sort of economic theory because its a waste of time, however I am glad that a currency not linked to a nation state is going to be able to challenge all of these assumptions.
It is just how they make money. What they DO is make the best search engine, host every video and livestream anyone on earth wants to upload, run the best email service on earth, run the best cloud office suite etc etc.
> How do ICOs reach these people: - There are numerous forums/chatrooms/reddits/twitter posters etc etc. One of the common tricks is for ICOs to reward 2-3% of tokens in "bounty programs" which basically rewards participants for facebook/forum/blog/youtube posts/spam. Very large ICOs like bancor have done this
> Legal status of ICO's - Unclear, but they are global and switzerland - where many of them are based out of seem to have liberal laws. For the SEC they seem to have indicated that you are likely to get in trouble if ICO's are more equity based, whereas "token" based network payment stuff is less clear.
The high early liquidity of ICO's basically mean that if an ICO has capped investment and has any sort of credibility, the ICO will reach its cap rapidly and when it opens on the exchanges it'll be up 3-10x and you can dump it and make a fortune, regardless of whether it is actually vaporware or a ponzi. This does not really happen in the past 3 months as the high demand ICO's generally take as much money as possible and don't cap it.
I think its sad that this business is going the way of the venture capital biz where well connected people get early/cheap dibs and average joes only get in once all the potential gains have been sucked out. Compare this to the ethereum ICO where everyone really got a fair short. I also think that if these have ponzi elements, being a preferred/connected/private investor in a ponzi makes you complicit in the ponzi scheme, whereas being an average joe just means you're playing the game.