BitCoin

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Re: BitCoin

Postby Agent Orange Cooper » Sat Jun 12, 2021 2:11 pm

overcoming hope » Sat Jun 12, 2021 10:26 am wrote:Crypto has clearly become the plaything of big institutions when you see a bunch of these crypto’s dump in exact unison clearly that’s what’s going on


This your first cycle? Shitcoins dump in unison because they are all inextricably tied to Bitcoin. Bitcoin rapidly appreciates = shitcoins dump. Bitcoin dumps = shitcoins dump. Bitcoin goes sideways = people get bored and shitcoins pump.
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Re: BitCoin

Postby dada » Sat Jun 12, 2021 4:06 pm

Anyway, that's my transgressive analysis of the topic. I'll step off here though and let the tension collapse. Collect my coins like Luigi and head for the warp zone.

As an aside before I go, getting into these politically tinged economic and social topics here really does remind me of my experience with the classic arcade gaming hobby message boards. Brings with it the feeling that the mainlines on these topics are mostly in the category of games and hobbys.

The old arcade boards reproduce the offical product line of the licensed brands. When I bypass the languages of the official brands and fanfictions, instead folding the cultural debris of branded materials into a language for transgressive riffs, dialogue or publishing exchange, it looks as if I'm playing another, different game, practicing outside of mass culture without a license.

The superfan ignores it, but if enough casual fans show an intrest, and join in the transgressive game, the superfan "grabs the bottom hammer" and starts smashing away at the barrells fillled with the most highly unsanctioned wine, stolen from bootleggers.
Both his words and manner of speech seemed at first totally unfamiliar to me, and yet somehow they stirred memories - as an actor might be stirred by the forgotten lines of some role he had played far away and long ago.
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Re: Bitcoin - Draft Wikipedia Entry

Postby Elvis » Tue Jun 15, 2021 10:33 pm

This nicely crystallizes my own conclusions.

JackRiddler » Fri Jun 11, 2021 6:59 pm wrote:
Bitcoin is a massive multi-player online game masquerading as a lucrative asset bubble masquerading as a new global currency system. The game simulates the mining of precious metals. The objective is to discover hidden electronic tokens, which are called coins. The rules require players to apply computer processing power, using the Bitcoin software, toward finding solutions to a complex online math problem. Solutions to the problem are discovered at indeterminate intervals. Tokens are allocated to individual players whose software is first to discover each in a sequence of millions of solutions to the problem. From the point of view of the players, allocation of tokens is essentially random. Outcomes can be affected only by marshalling additional processing power, i.e., running the program on more machines so as to raise the chances of discovering tokens. Committed players buy or build server farms for the purpose of prospecting for bitcoins. Continuation of the game has required an ever-increasing supply of power on a global scale, thus also competing with real-world mining in terms of the overall consumption of energy and resources, and resulting damage to the ecological carrying capacity for human life on earth. The overall supply of tokens that can be discovered is capped at 21 million, and thus exhaustible, and discovery of tokens becomes more difficult over time, all of which again simulates real-world mining for precious metals. The cap presumably would have a radically deflationary effect on bitcoin as a currency, were it actually in use as a currency; although the argument is made that the bitcoin-currency will be infinitely divisible to counteract this. Correspondingly this same imposed scarcity of the virtual token so far has had an inflationary effect on the price for converting bitcoin to conventional currencies, which appears to be the true intent, given the effects: The price for conversion of bitcoin into conventional currencies has skyrocketed and proven to be extremely volatile. Subsidiary markets have been set up to allow speculation on futures.

Created and programmed by an unknown and anonymous entity that published an accompanying manifesto, the game has enlisted millions of players hoping to become rich, or who wish to transfer wealth and enact payments without detection. Other than the promise of material reward, participation is otherwise driven by players' faith in a crude libertarian salvation ideology, in which Bitcoin is supposed to become the new dominant planetary currency. Enthusiasts describe this activity as promising human liberation from the bondage of existing monetary systems and their ruling oligarchies. In place of the oligarchs who randomly inherited wealth, or who lucked and clawed their way into monopoly control of given revenue streams, or who are licensed to create money by lending it at interest, Bitcoin's new elite would arise among those who randomly won sufficient allocations of virtual tokens in the MMPOG or who could otherwise command the flow of Bitcoin wealth independently of any form of regulation, taxation, or capital controls, other than those set by the programmed rules of the game. Players tend to look down upon those who don't get the point of all this, or who fail to see how the hoped-for advent of the Bitcoin system as a new global currency with attendant systems of capital allocation and economics, and with the winning players as the new oligarchy, would constitute an improvement over the existing systems of capital allocation and labor exploitation, as bad as these have proven to be. On the contrary, the Bitcoin MMPOG appears as a fantasy of total neoliberalism, capital without frontiers. For the same reason (among many other reasons) the full Bitcoin utopia is bound to remain a dream, as it would intensify all of the same crisis manifestations that unregulated capitalism already causes.


In the bitcoiner utopia model, people would be forced to compete with BTC oligarchs to obtain this private asset that has no volatility controls, no credit rules and no backstop. Of course any regulation —inevitable—would be conceived and enacted by BTC oligarchs. I think most people would end up being in debt to and ultimately owned by BTC oligarchs. Feudalism, anyone?

Or is that the scenario in the back of many bitcoiner minds? After reading thousands of their comments & explanations, I think it is. Classical liberalism's robber barons all over again.

Also: Is bitcoin a state spook operation? Or maybe a private spook operation?
“The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.” ― Joan Robinson
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Re: BitCoin

Postby Belligerent Savant » Wed Jun 16, 2021 10:39 am

.
We can only speculate as to what may come to be, if indeed bitcoin/digital currencies become prominent in the coming years.

The same interests that control/manipulate monetary policy now will be (and are already) involved in digital currency adoption, in any event, though perhaps there will also be decentralized options available to the masses (away from centralized control), which currently are NOT available under current systems.

As for the reference to feudalism. What do we have now (and particularly over the last ~20 yrs), if not a modern version of it? It's been here for some time already.


Belligerent Savant » Sat May 22, 2021 2:48 pm wrote:...

https://scheerpost.com/2021/05/18/how-a ... alism/amp/

How America Went From Mom-and-Pop Capitalism to Techno-Feudalism

In a matter of decades, the United States has gone from a somewhat benign form of capitalism to a neo-feudal form that has created an ever-widening gap in wealth and power. In his 2013 bestseller Capital in the 21st Century, French economist Thomas Piketty declared that “the level of inequality in the US is probably higher than in any other society at any time in the past anywhere in the world.” In a 2014 podcast about the book, Bill Moyers commented:
Here’s one of its extraordinary insights: We are now really all headed into a future dominated by inherited wealth, as capital is concentrated in fewer and fewer hands, giving the very rich ever greater power over politics, government and society. Patrimonial capitalism is the name for it, and it has potentially terrifying consequences for democracy.


...
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Re: BitCoin

Postby Elvis » Fri Jun 25, 2021 4:54 pm

Elvis wrote: I think most people would end up being in debt to and ultimately owned by BTC oligarchs.


"2 per cent of “network entities” control almost three-quarters of all bitcoin. Inequality in bitcoin is far worse than in any fiat currency"

Links in original:

https://www.ft.com/content/26283f09-c3d ... 083b063d8a

Why we shouldn’t listen to crypto ‘experts’

Most are just insiders talking up their interests

Jemima Kelly
June 23 2021

As someone who has written about crypto on and off for more than six years, I have become used to the endless armies of zealots and trolls who harangue me every time I write anything vaguely critical of bitcoin. I consider such goading annoying but part of the job, and I tend to ignore it.

But recently I’ve been struck by one increasingly common jibe, because it inadvertently undermines the supposedly altruistic aims of the bitcoin brigade: “Have Fun Staying Poor.”

This meme has become so common in cryptoland that a song has been written in its honour; you can even buy T-shirts emblazoned with the phrase. The taunt is directed at so-called “no-coiners” like me whenever we express scepticism. Whether or not our criticism is warranted is irrelevant. The thinking is that because the price is so obviously going to keep going up forever, those of us who don’t buy into it are going to be mired in poverty while those who invested get filthy rich.

If such a system sounds reminiscent of a Ponzi scheme, that’s because it is. Although some of the traditional characteristics — such as a head or central administrator or the existence of cash transfers — are lacking in bitcoin, others are not. Those who get in at the start must continuously draw in new believers to keep the whole thing going. Many of them market themselves as “crypto experts”, pushing the currencies as a solution to a host of financial and economic issues they often have no expertise in. As prominent bitcoiner Antony “Pomp” Pompliano unashamedly tweeted to his almost 1m followers recently, “Every bull market has to indoctrinate the new class of crypto enthusiasts”.

“Technically it doesn’t work quite like a Ponzi, but you get the same net result,” says Martin Walker, director of banking and finance at the Center For Evidence-Based Management. “The brilliance of the whole crypto scam is that you don’t actually have to generate any income to pay anyone, so you don’t run out of money because you’re making people believe in ‘number go up’.”

What the bitcoiners never explain — and some don’t seem to quite understand — is that this is a zero-sum game: we can’t all get rich from it. But if you listen to “expert commentary”, there is no acknowledgment of this, nor of the way the system is skewed to enrich those at the top of the pile. Quite the opposite, in fact — analysis is always about “democratising finance”, “increasing economic freedom”, or bringing the fight to the evil central bankers intent on inflating away the value of our money.

[more]

“The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.” ― Joan Robinson
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Re: BitCoin

Postby drstrangelove » Sat Jun 26, 2021 1:34 am

Looks like a bunch of leverage has been hidden inside bitcoin since march 2020, and every time the S&P begins to crash, this leverage is taken out of bitcoin and injected into stocks to sure up the market.

Look at prices for S&P and Bitcoin for:
Feb 22- March 4
March 20- 29
May 10-14
May 17-24
June 16-22

Bitcoin deflates when stock deflates. Stocks then inflate after bitcoin deflates. bitcoin recovers only a little each time when zealots buy the zip, but the leverage is drying up so the price never makes a full recovery.

There is a little boy who lives in my mouth telling me the stock bubble will pop, on or around July 4th 2021. However, I refuse to believe Kubrick could be so precise in the matter of history repeating itself. But the leverage is running out and the situation will soon be shining, bright enough for all to see.
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Re: BitCoin

Postby Agent Orange Cooper » Sat Jun 26, 2021 2:17 pm

drstrangelove » Sat Jun 26, 2021 1:34 am wrote:There is a little boy who lives in my mouth telling me the stock bubble will pop, on or around July 4th 2021. However, I refuse to believe Kubrick could be so precise in the matter of history repeating itself. But the leverage is running out and the situation will soon be shining, bright enough for all to see.


Ha, you should look at my day job. We have proof: https://youtu.be/MIP4AtxRQRo

And over on twitter: http://twitter.com/cryptokubrology
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Re: BitCoin

Postby drstrangelove » Sat Jun 26, 2021 4:06 pm

Kubrick bearish on dollar currency. the Gold Room's in the past. Jack gets drunk on house credit. The shining is economic horror.

Though in this case it would be history repeating a 1200 month cycle(from July 4th 1921), not 237 months.
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Re: BitCoin

Postby Agent Orange Cooper » Sat Jun 26, 2021 5:40 pm

Right, but then again, 1200 = 12 = [2 + 3 + 7]

100 years we call a C-Span (for Century) = 36524 days

The # of days Kubrick was alive, a K-Span = 25792

The # of verses in the Bible, a B-Span = 31102

Findings (as seen in YT link):

(edit: corrected typos)

C-Span - B-Span = K-Span - 20370
or
C-Span - K-Span = B-Span - 20370
or
K-Span + B-Span = C-Span + 20370

Thanks for coming to my wildly off-topic TED talk
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Re: BitCoin

Postby drstrangelove » Fri Jul 02, 2021 4:19 am

We have almost arrived.



Image
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Re: BitCoin

Postby Elvis » Sun Jul 11, 2021 11:45 pm

As I've been more or less saying...yes there will be a U.S. CBDC dollar and it will be worth exactly one US dollar. Many good links therein. The graphic is too cool not to include.

https://www.forbes.com/sites/rhockett/2 ... greenback/

Archive: https://archive.is/UUgG3




So Long, Cryptopians – Greet the New Digital Greenback

Robert Hockett
Jun 28, 2021

Image

It started … if you’ll pardon the pun … a ‘bit’ over a decade ago, at least in its more popular manifestations – the spread of new talk of a strange new money form. Or was it a payment form, or a finance form, or something else? (It was of course all and more, as we’ll explain.) Like an ectoplasm – nay, a cryptoplasm – ‘chat group’ chat spilled over to internet, then popular media chatter. It was all about ‘tokens’ and ‘coins,’ ‘blocks’ and ‘chains,’ ‘ledgers’ and ‘DeFi’ and … oh yes, ‘disruption.’

But it all went beyond merely that. It promised value-retention in a post-crash dystopia of central banks’ putative ‘currency debasement.’ It promised (sometimes ironically) privacy – even for money-launderers, kidnappers, and terrorist finance. And it went further still – promising ‘freedom,’ riches, power, even … that pleonasm of all pleonasms and narcissism of all narcissisms … ‘self-sovereignty.’

What was this strange object or substance? ‘Coin,’ ‘token,’ even ‘bit’ all sound tangible, even harmlessly, charmingly fetishistic. Imagine a shiny ‘Gold Sovereign’ as if in a Dorothy Sayers novel or James Bond film, save stored somewhere ‘out there’ in cyberspace where it cannot be stolen or taxed… And if that sounds a bit too ethereal, well, we could virtue-ize the virtual with names like ‘Etherium.’

The wonder and mystery of it all, enhanced by its Pavlovian associations with what could look like ‘The Future’ – geometrically growing computing power, ever-more sophisticated cryptography, the romance and adventure of hacking and ‘meme’-spreading and ‘finance-democratizing,’ the sheen of ‘high’ tech and ‘fin’ tech and ‘digital culture’ – only added to its aura. Like a nuclear-activated ‘Blob’ in some ectoplasmic ‘50s science fiction film, Cryptoplasm spread to bid fair to eat everything. And so an entire community of Cryptopians grew and grew ever more fruitful and multiplied.

But what was the ‘fruit’ of this ‘fruitful,’ other than simply more seed-sowers? How was it anything other than self-referential self-replication and –multiplication? How could it ever be, in finance parlance, anything other than Ponzi-processual, a Cryptopian version of ‘greater fool’-fooling, speculative pseudo-investment?

The answer, under-appreciated as always, was that it could not. Indeed, Crypto-Whatever was doomed from the start to fare worse even than Junk-Bonds, Subprime-This-and-That, and other objects with unheeded warning-label names such as ‘Junk,’ ‘Sub,’ and the like. For unlike these previous propositions, whose ‘value proposition’ was merely remote, the Cryptopians’ value proposition was all but non-existent. There was near literally ‘no “there” there.’

Why might one say that? We should unpack it a bit. So: what is a ‘value proposition’ and how might it underlie some forms of ‘junk’ but not crypto junk?

Well, it’s the promise of some growth of wealth in the productive, or ‘real’ economy, which can then underwrite claims on such wealth in the claim economy – that is, the financial economy.

Junk bonds were claims on the value-recoupment then promised by reorganizations of bloated and poorly organized firms. Subprime mortgage instruments were claims on the value-recoupment promised by higher-risk/higher-reward lending enabled by better credit-risk organization (the ‘slicing and dicing’ you heard of with wearisome repetition). These promises were of course overblown. But at least they were grounded. The problem lay more in the … pun coming … ‘tethering’ than in the value that fad-objects were tethered-to.

Not so with the Cryptopians’ charmed objects. Sure, the ‘coin’ called ‘Tether’ – like subsequent so-called ‘stablecoins’ – was tethered to something. But alas, it was mainly tethered, directly and indirectly, to precisely what new ‘coins’ were meant to replace – real coins, real money … sovereign currency. What then did it have to offer in its own right? What was its non-parasitic ‘value proposition’?

Things were of course worse for most other Cryptopian offerings. For these all relied upon ‘network effects’ for their prospective value yields, and ‘network effects’ were in this context nothing but Ponzi effects. The value of current holdings, that is to say, was nothing more than the price-rises hoped to be generated by more people’s becoming holders. You could ride only the Keynesian ‘foam’ on the wave, in other words, there was no real water.

To what real wealth-generation – what actual production – after all, is a Bitcoin’s price linked? It can’t be the algorithmic puzzle-solving (euphemistically dubbed ‘mining’ to make you think ‘digital gold’) to which Bitcoin issuance is tied. For the puzzles themselves are gratuitous, designed for no reason other than to contrive Bitcoin scarcity – a scarcity hoped to keep Bitcoin ‘valuable’ in contrast to central banks’ putative ‘currency debasement’ (long the goldbugs’ senescent trope).

But money is worth nothing if not widely used (not merely ‘purchased’) and recognized in payment. And widespread payment using a particular money will never occur unless that money’s supplies are deliberately modulated – flexibly expanded and contracted to retain stable proportions to goods and services commanded by money over time.

Central banks are quite good at this now. ‘Precious’ metal pegs, ‘Taylor Rules,’ and other ‘barbarous relics’ are not. And in this sense dear Bitcoin’s as barbarous as it gets. For at least we’re unsure of how much more gold there is here on earth, whereas we know now that nearly 19 million of the available 21 million Bitcoin that will ever be ‘issued’ have been issued – and are overwhelmingly held by a shockingly small number of oligarchs – Cryptogarchs – in China. That’s not the makings of a money. It’s a scam past its sell-by date.

These are all reasons why Cryptopia was always no more than a castle in the air. But now there’re additional reasons for the castle’s overdue crumbling. For one thing, regulators worldwide are now onto the scam, and cracking down. They too have seen all of this before, and have simply been waiting till now to see whether the fad would end quickly enough on its own. Now that it hasn’t, they’re stepping in as they do always when ‘Wests’ grow too ‘wild.’

China’s moves have of course been the most visible, both because the government’s less in thrall to industry pressure and non-Party utopianism, and because so much ‘mining,’ which is astonishingly energy-draining, carbon-emitting, and hence environment-degrading, occurs in its borders. But other jurisdictions are now moving rapidly too, throughout Europe and North America in particular. El Salvador’s desperate move to monetize Bitcoin ‘for reelz’ – tellingly, only because it can’t manage its own currency – will not slow, but will hasten that.

For another thing, and more importantly now, central banks worldwide are at last recognizing that they themselves can and should offer what little good the new payments technologies promise without surrendering the indispensible features that make ‘money’ money. Among those are sovereign full faith and credit, legal tender assurance, and supply modulability – the extensibility and contractibility noted above.

You can have cryptographic privacy protection, real time clearing and settlement, and transaction record indelibility without sacrifice of those indispensible features of all bona fide, non- … another pun coming … bit-player monies. Central banks see this, and are thus working up plans for their own central bank digital currencies (CBDCs).

Once again China is acting fastest and biggest. But it is far from alone as the Banks of England and Japan, the European Central Bank, the Fed, and a host of others now enter the field. Indeed Sweden is already pulling ahead, with the e-krona in trial use since early last year.

As a developer of public digital payment platforms and associated digital currencies (which always are simply what ‘counts’ in a practice or system of value and payment accounting), I am no skeptic of digital currencies and digital ledgers. Indeed, I think they are bringing us full circle back to the public accounting in which all monies originate, in a multi-millennial process that I’ve called, in these pages, ‘from ledgers to tokens and back.’ But the point here is less about tech than what tech in fact promises and how it is used.

Cryptopia was always a scam and mirage. Cryptography and other benefits offered by payments modernization are not. ‘Self-Sovereignty’ and other faces of steroidal narcissism and rightwing ‘libertarianism’ have likewise been scams and delusions from the get-go. Legitimate privacy and both citizen and ‘consumer’ autonomy are not – as any victim of a consumer ‘data-harvesting’ or algorithmic telemarketing company can tell you.
But these legitimate benefits are and have always been vouchsafed, not by feudal or neo-feudal sub-sovereign landlords or warlords or oligarchs, but by citizens acting collectively to provision themselves individually – that is, by citizens acting as states, as democratic republics, as constitutors of every legitimate res publica (public entity). Lest you think this claim fanciful, let me remind you that we’ve been here before…

Paper currency itself, as I’ve argued both in my scholarship and in these very pages, used to be privately issued in the US. By the mid-19th century, there was a veritable Babel of ‘wildcat banks’ offering multiple ‘wildcat currencies’ here in the US. There was no US-issued paper dollar, only privately issued paper dollars. In a rapidly growing economy plagued by specie (precious metal) scarcity, this form of flexible-issuance-enabling innovation was a godsend. But it wasn’t yet optimized.

The problem was the wildcat currencies fluctuated wildly in value, both over time in relation to purchasable goods, and over space in relation to one another. This was inimical to long-term functional currency status just as over-abundant incommensurable dialects and over-frequent meaning-changes would be inimical to a functional lingua franca. (Currency Babels are as literally counterproductive as are idiomatic Babels if your aim is to produce a Tower together.)

This want of what I have elsewhere dubbed spatial and temporal uniformity rendered the US’s paper currency system unsuitable for long-term stable integration of sub-national markets into one single national market – the aim of our nation’s founders and our Constitution’s framers. It also rendered prosecution of any national project – like holding the Union together during the Civil War – quite impossible. (The Union, too, was the ‘Tower’ – the political integration on which economic integration depended as always.)

President Lincoln and Congress did not conclude from this, however, that paper currency (as distinguished from metal coinage or bullion) was a bad idea. They understood the modulability benefits mentioned above. So instead they concluded that ‘wildcat’ issuance of multiple paper currencies was a bad idea, at least after the ‘proof of concept’ – that paper was better than metal – had been well established. Hence they enacted a Currency Act, a Legal Tender Act, and a National Banking Act over 1862-64 to establish the ‘Greenback’ dollar bill that remains to this day the world’s most successful publicly administered paper currency.

We are now in the crypto equivalent of the wildcat paper currency era. We’ve reached the time that the public takes over to optimize what the private sector has fragmentedly proved possible – viz., an operable central-bank-managed digital currency, a CBDC. Farewell, then, with thanks, to the inspiration afforded us all by Cryptopia. And hello, with determination now to speed-up development, to the Digital Greenback.



About Robert Hockett...

ABOUT

I teach legal, financial and some philosophical subjects at Cornell University in New York, where I am the Edward Cornell Professor of Law and a Professor of Public Policy. I also am Senior Counsel at Westwood Capital, a socially responsible investment bank in midtown Manhattan, and a Fellow of The Century Foundation, a think tank near Battery Park in lower Manhattan. My principal research, writing, and practical concerns are with the legal and institutional prerequisites to a just, prosperous, and sustainable economic order. I have worked at the International Monetary Fund and the Federal Reserve Bank of New York, and continue to serve in a consultative capacity for a number of U.S. federal, state, and local legislators and regulators. I grew up mainly in New Orleans, America's most wonderful city (sorry, New York), and return to it often. I was educated at Yale, Oxford (as a Rhodes Scholar), and the University of Kansas.
“The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.” ― Joan Robinson
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Re: BitCoin

Postby Elvis » Sat Sep 11, 2021 6:02 am

https://davidgerard.co.uk/blockchain/20 ... vo-signup/

El Salvador Bitcoin: how Chivo doesn’t work; how to fake a Chivo signup

10th September 2021 - by David Gerard - Leave a Comment


Since Tuesday, Bitcoin in El Salvador has stumbled along in the form of the Chivo Wallet. The “$30” bonus is motivating people to sign up with Chivo! Then they find out all the ways it doesn’t work.

Chivo could be a good idea! A national payment system, with government backing. Public kiosks, helpful customer service staff at the kiosks. Get money moving faster, stimulate the economy.

Trust is key, though. People worry about money. A new payment system must show itself to be solid, and build itself a reputation as being solid.

In the UK, the touch-to-pay card system was created in 2007, and widely promoted by banks from 2012. It proved itself to be convenient and trustworthy — by 2017, more payments were made (both in number and volume of transactions) by touch-cards than with physical cash. [FT, paywalled]

If only Chivo hadn’t been set up by overconfident incompetents.

Image


The return of Mario Gómez

Mario Gómez is back online! He’s created a temporary Twitter account, @mxgxw_gamma, and posted a video. [Twitter]

Gómez’s message is that he was lucky to be someone with a network of contacts who would say something:

What would have happened if it had been someone else who doesn’t have these support networks? What would have happened if I had not had the Internet? What guarantees are there that anyone else who has a different opinion is not persecuted and has options? If I am here speaking, it’s for all those people who joined to denounce and expose the abuses.


He suggests you network with people, and keep speaking up.

Gómez has also been doing chats on Twitter Spaces. [Elsalvador.com, in Spanish; ElSalvador.com, in Spanish]

He says not to use the Chivo Wallet if you want bitcoins — the $30 in “bitcoins” is not transferable to other Bitcoin wallets.

Gómez also warns that Chivo has serious data protection problems. “You can’t play with people’s money or with their personal data.”


No, your customer?

The Chivo system failed at 3am on launch day. President Bukele tweeted that the image upload server had run out of capacity.

Chivo has fixed the problem as simply as possible: the Know-Your-Customer functionality … doesn’t check images!

A few people have confirmed that Chivo’s customer identification accepts the following:

- When it asks for your DUI (national ID card), use any image you have;
- Use any photo you like as your face;]Use any photo you like as your face;
- Put in a DUI number — which might even be your own — and a matching date of birth.

Chivo then doesn’t do anything to verify that the photos have anything to do with the DUI or date of birth. [Twitter, archive]

Lots of people are discovering that their DUI number has already been used. [Twitter] Others are having fun with publicly-known DUI numbers — such as lists of recently-deceased people and their DUIs. These are published by insurance companies … to stop fraud. [e.g., AFP Crecer, PDF]

DUI numbers are not super-private. You use them lots in daily life, e.g., for purchases over $100. Using a DUI as the sole identification for Chivo is mind-boggling.

I expect bots will already be running through DUI numbers and skimming “$30” Chivo signup bonuses.


Chivo Wallet

The Chivo app shows 50,000+ installs on Google Play and 357,000 on Huawei. Apple doesn’t display download numbers. [Google Play; Huawei App Gallery; Apple App Store]

The Google Play store rating is 2.8 out of 5, which is not good for an official national payment system. Here’s some reviews (translated):


- “Verification failed, enter my DUI, the phone number, the photo of the DUI, after taking the photo of my face, it says error and it doesn’t work, it says verification failed, there’s no way to go back or start again since they have my data, to say that I’m the same person.”

- “It gives me an error, it doesn’t accept my PIN. To be able to re-enter I have to uninstall the app and reinstall, entering my passport # and PIN again.”
- “It doesn’t recognize my PIN, my fingerprint, nothing … it gets very stuck, I had to uninstall and reinstall it twice …”

- “I use an S21 and it only worked one day, now when I enter the app it keeps loading the transactions and I cannot see my balance or use the app for payments, at the moment they lack a lot of work for the app to work correctly.”

- “This is a garbage application that doesn’t work … when taking the photo of the DUI the application disappears and you cannot register, this is garbage just like the dictator we have.”

- “The app with the most problems that I have installed on my cell. Input errors, failed verification codes. It does not recognize my password … Anyway, that’s just to mention a few.”

- “The application is not really ready to be used. Super bad experience with most users. Few have successfully created their account.”

- “Error occurs when I take the photo of the DUI.”

- “DUI photo validation error.”

- “Do not download it yet, it is full of bugs, it lets you register without being verified, which doesn’t work and there is no way to re-verify once registered and it’s worse if you are outside the country (El Salvador), because the only number Customer Service offered is the telephone number 192, which cannot be dialed from abroad.”


The app seems to need a recent phone — which is a problem when it’s for the general public, who are unlikely to be able to afford a Galaxy S20. Many users hoping for a free $30 were disappointed that their phones were too old. [Elsalvador.com, in Spanish]

The network itself has been intermittently working and not working. For several hours yesterday, you could transact, but not register.


The merchant use case

Many traders who spoke to La Prensa Grafica don’t want to accept Chivo. “I’d rather lose the sale,” said one trader, who said she would go by President Bukele’s promise on June 24 that accepting bitcoins would be optional. Others don’t trust money that they can’t hold in their hands. Street vendors often don’t even have phones. Many of their customers are illiterate. [La Prensa Grafica, in Spanish]

Aldo Ortiz runs a video game business that sells online — an obvious use case for Chivo. He has $300 in Chivo that he can’t withdraw — because the ATMs don’t work, and neither does the send-to-bank function.

(La Prensa Grafica notes that “extra options” such as transfers to banks are not yet available. They’ll come “later.”)

“A customer wanted to send me $23. The app notified him that he had sent $23 but in the transaction list it sent $2, twice.” The customer sent the remaining $19 in a separate transaction. [Twitter; Twitter]

Ortiz says that “people want to spend their $30 and delete the app. They’re not interested in using it for anything else.”

I got one report from a user about paying via Lightning Network at McDonald’s:

I went to a McDonald’s in Zona Rosa and tried to pay with MuunWallet and it gave me an error saying “not a Bitcoin address”.

Muun can do both ⚡ and BTC but it didn’t went smoothly as yesterday at Starbucks. McD gives you a printed QR.

The cashier told me it is always the case, he told me it hasn’t been working and that they have made just 1 successful payment with Bitcoin since all this started.


Aaron van Wirdum of Bitcoin Magazine tweeted on Tuesday about how he used the Lightning Network at a McDonald’s, and it was retweeted by President Bukele; it’s not clear if this was the same McDonald’s. [Twitter]


Not what you know, but who you know


Someone in El Salvador’s government — or multiple someones — is leaking like a firehose to El Faro. Here’s the corporate history of Chivo SA, the private for-profit company running off public funds that runs Chivo Wallet. [El Faro, in Spanish]

“A lawyer prosecuted for falsifying a will helped create the company running Chivo Wallet. The notary who attested to the legality of Chivo SA de CV, created with public resources by the Government, was accused of documentary falsification in 2020.” [Factum, in Spanish]

President Bukele’s Chief of Staff, Marta Carolina Recinos de Bernal, is on the US State Department’s Engel List of corrupt officials. She’s also a director of Chivo SA. [Elsalvador.com, in Spanish]

A lot of Chivo’s problems are because Bukele’s team got people they considered politically trustworthy — and not people who could do the job.

(I’m in the UK, and we’re very used to this way of working. And the disasters that follow.)


Athena is up

Athena Bitcoin is a publicly traded company. Their stock price is way up — from $7.00 a week ago to $36.00 as I write this, with reported peaks over $40.00. ABIT is an over-the-counter microcap stock, not listed on an exchange, so any interest will create this sort of chart; but someone thinks the Chivo ATM contract is good news for Athena. [Yahoo! Finance]

Image


The eyes of the world

I was quoted in some news articles:

- AP, before launch: “I don’t know what will happen on Tuesday but it won’t be a working system that goes smoothly and does everything they advertised for it.” [AP]

- AP, after launch and the Bitcoin price crash: “My first guess was shenanigans, because it’s always shenanigans.” [AP]

- MarketWatch: “They bulldozed into it with no planning and preparation. Payment systems are really complicated. Anything with a really good user interface has massive complexity behind it, and there’s no exceptions.” [MarketWatch]

- CoinMarketRecap Podcast on El Salvador, with a local crypto enthusiast and then me about how it’s been going this week. We concur that Bitcoin in El Salvador, and Chivo in particular, are absolutely not at the usability levels necessary for a general audience of non-techies. This is a good listen. [SoundCloud]

I also did TV spots for BBC and NTD.


What happens now?

So far we haven’t had a pile of crooks coming in to clean their dirty bitcoins, and drain the $150 million trust that was set up to buffer between bitcoins and dollars. (Because Chivo doesn’t work.) So that’s nice.

Instead, we’ve got crooks defrauding the sign-up bonuses. That’s not so good.

Chivo’s functionality and customer service are all but unusable, and you can’t get your dollars out.

If you want Salvadorans to hate everything about Bitcoin, and electronic payment systems in general, this is a good way to get there.


“The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.” ― Joan Robinson
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Re: BitCoin

Postby Iamwhomiam » Fri Sep 24, 2021 3:00 pm

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Re: BitCoin

Postby drstrangelove » Mon Sep 27, 2021 2:40 am

All China would have to do now to spur adoption of its cbdc is devalue the yuan, through say, bailing out some 'too big to fail' debt ridden corporation.

Oh would you look at that, Evergrande is collapsing.
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Re: BitCoin

Postby Agent Orange Cooper » Thu Dec 23, 2021 4:19 pm

https://bitcoinmagazine.com/markets/why ... ect-option

BITCOIN IS THE PERFECT OPTION, AND CENTRAL BANKS WILL HAVE TO BUY IN
What happens if the market realizes that kicking the can down the road is delaying the inevitable? A sustainable form of insurance in this event would have to be bitcoin.

In “part one” of this article, we provide a high-level overview on options, the components that make them valuable and how these components are priced in order to come up with a comprehensive value for any particular option. Readers who are not familiar with options and option pricing are encouraged to read “part one” before moving on to the rest of the article.

For more option-savvy readers, you may jump immediately to “part two,” where we will explore why we believe bitcoin (BTC) is a long volatility position. Since most other assets in a diversified investment portfolio are in fact short volatility positions, bitcoin can offer portfolio hedges in the event of increased volatility in tangential markets.

We then extend the analysis to determine why bitcoin is in fact a very valuable “exotic” option. Moreover, as an exotic option with no term, there is no time decay on your long volatility position. Finally, in a world where exotic options generally require a contract with a defined counterparty (they are not generic, thus don’t trade on exchanges per se), the fact that bitcoin has no counterparty risk leads to the conclusion that bitcoin is the perfect option that, over time, will come to be embraced by investors as a hedge to a short volatility-biased investing world.


https://rumble.com/vr9i0j-why-are-hilla ... iew-w.html

Why are Hillary and Trump United in Warning of Bitcoin's Dangers?
Interview with Alex Gladstein

People across the political spectrum are recognizing multiple, growing threats: escalating Big Tech censorship of our political speech, the costs and corruption of Endless War, the spying of the US security state on American citizens, the dominance of neoliberal globalist institutions. Many believe that Bitcoin, by undermining the power of fiat money and enabling greater anonymity, can erode if not solve many of these problems. Glenn Greenwald speaks to one of the leading Bitcoin advocates, Alex Gladstein of the Human Rights Foundation, about the challenges and critiques of Bitcoin. (The part of their discussion about the environmental impact of Bitcoin will be published as a separate segment).

Read Alex's article: https://bitcoinmagazine.com/culture/bit ... mperialism
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