Monday, July 29, 2019

Ray Youssef Talks Wisdom

Friday, July 26, 2019

Blockchaining Entire Industries

No industry has been spared the Internet. No industry will be spared the Blockchain.

How Blockchain Will Change Construction Blockchain technology is among the most disruptive forces of the past decade. Blockchain’s power to record, enable, and secure huge numbers and varieties of transactions raises an intriguing question: can the same distributed ledger technology that powers bitcoin also enable better execution of strategic projects in a conservative sector like construction, involving large teams of contractors and subcontractors and an abundance of building codes, safety regulations, and standards? ....... set up a blockchain-enabled project management system to make the building development lifecycle more efficient. .. registering transactions at legally binding moments, where accuracy and an audit trail are essential .. “Blockchain provides a platform for clearly cascading work products down the chain and holding everyone accountable for completing key tasks” ....... The system’s benefits include timely information, unambiguous communication, and fewer mistakes. ... They also develop trust, which reduces friction in their mutual business processes. “Stakeholders spend more time discussing creative design and building method options.” ..... 95 percent of building construction data currently gets lost on handover to the first owner ...... the potential to capture and secure a construction project’s documentation in a blockchain ledger that parties can navigate and give to the owner as a deliverable. ...... The blockchain-encoded specifications are granular—paint colors, ceiling fixtures, LED bulbs, door hardware—plus manuals, warranties, and service life in a countdown clock that building owners can monitor. ........ building owners get a living ledger of everything that has happened with the building. ..... “But the industry is very relationship based. There are many family-owned firms and private companies. The selection of contractors and subcontractors can be based on relationships that have existed for decades.” ...... While the fundamentals of project management will remain important, blockchain enables managers to focus their talents on solving problems and achieving better project outcomes.

The Crypto Crash Is Coming

The Blockchain People

The dot com boom happened on Nasdaq. The crypto boom is not there. The crypto boom is happening in the fact that there are more than 2,000 cryptocurrencies in play right now. This is crazy.

Crypto was supposed to simplify things. In the old world, we have about 200 national currencies. In the new crypto world, we have more than 2,000. This is not simpler.

When a cryptocurrency crashes, everyone who bought into it with real money will stand to lose that money. Most of these more than 2,000 will crash and burn. A lot of people will lose a lot of money.

This seems to happen with every new technology. When cars first showed up, there were thousands of car companies. Most of them went out of business. A handful survived.

Less than five of the more than 2,000 cryptocurrencies might survive. Three of them might be Bitcoin, Ethereum and Libra.

How will a cryptocurrency blow up? Loss of computing power is one way. A cryptocurrency needs hardware, it needs electricity, it needs computing power. When you are no longer growing, you start shrinking, and when you start shrinking, the end is near.

Another way would be for the founders to simply disappear. These would be fraudulent people who always meant to create a frenzy and cash out before anyone found out what was going on.

As to when the clean-up might happen is anyone's guess. It might be five years. Who knows?

One form of the crypto crash would be where the vast majority of the more than 2,000 cryptocurrencies are no longer around. 1990 gone, 10 still around kind of scenario.

Another form of the crash would be where say Bitcoin loses 90% of its value. So Bitcoin is still around. But it has lost most of its value. And then it starts its slow climb up. It was always real. And it will stick around. But its dollar value was way up than it needed to be. "Miners" get rewarded for computing power. If the next generation of computers is vastly more powerful and vastly cheaper, that might impact the Bitcoin price. Or not. If the use of Bitcoin just keeps getting larger and larger as computers and electricity get cheaper and cheaper, that dramatic crash might not even happen.

The Bitcoin is an incentive to build the Blockchain, the ledger. People are being rewarded for building the Blockchain.

Could the major cryptocurrencies talk to each other? The way your Gmail talks to Yahoo Mail and to Hotmail? They have to. If all the cryptocurrencies will talk to the real world currencies like the dollar, then obviously they also have to talk to each other. That might bring some stability.

Market corrections will inevitably happen. As to when and what forms they will talk is anyone's guess.

Wednesday, July 24, 2019

India, China, Cryptocurrencies, And What's Up With Banning?

China might have active censorship of the Internet, but it knew better than to ban the Internet. China might have disallowed Google, Facebook, YouTube, Twitter, etc. inside China, but it actively nurtured Chinese versions, most of which are huge in size by now.

Banning cryptocurrencies is not like banning Google, or Facebook, more like banning search engines, or social networks. Cryptocurrency is not a company. It is an entire class of application. The Blockchain is the fundamental technology, just like the Internet. There are many cryptocurrencies like Bitcoin that sit on top of that Blockchain. Take just one Bitcoin. There are many, many companies who all deal with Bitcoin. The Bitcoin is basically a ledger. It is bookkeeping.

There are too many bright minds in China and India to want to skip something that is going to be 100 perhaps 1,000 times more monumental than the Internet. The Blockchain is as inevitable as the Internet. There is no skipping the Blockchain.

But there is a feeling that US-based Bitcoin dealing companies go into all these countries and suck money out of the system. People buy Bitcoins with real money. But the Bitcoins they buy then is no longer in reach of the respective central banks. That the governments of China and India seem to see as a problem. Is that a problem?

What they fail to see is the Bitcoin challenges the global hegemony of the US dollar like China has long dreamt about. Donald Trump's anxieties about trade deficits would go away if the US dollar is no longer the global currency by default. So looks like even the US government ought to be rooting for crypto.

Just like the Internet has been free speech in a concrete form in places that have yet to enshrine free speech through the traditional political route, the cryptocurrencies challenge the global hegemony of the US dollar, as well that of the central banks of the world. Crypto gets rid of both inflation and deflation.

Instead of trying to stop cryptocurrencies, countries like India ought to try to shape them. There are glaring governance issues. There are obvious questions.

If citizens in a country like Venezuela were to move their money from the local currency suffering the plague of hyperinflation onto the crypto realm, does the central bank in Venezuela become toothless? No. It can still print more money.

Being able to easily move money is a boon for the average person in a country like India. That is the most immediate application of the Bitcoin. For the number one remittance country in the world, it is curious India might want to ban crypto. Don't you want the Indian diaspora to be able to send money to India in frictionless ways?

It is true right now is the wild west phase of the crypto. Too many people are using it as a speculative exercise. Many of them will lose money. By the Indian government's count, there are more than 2,000 cryptocurrencies floating right now. This is the dot com mania all over again. If Ethereum were to collapse, whatever that might mean, there is no entity that will reimburse you for the money you might have used to buy those crypto coins. Is the Indian government seeing a crypto crash in the near future? And preparing for it?

The G20 should instead take the initiative to try and create a B100, or Blockchain 100, a G20 like grouping of the top 100 Blockchain companies by market value that would meet annually, and hold transparent debates and discussions to forge the ground rules for cryptocurrencies and the Blockchain in general.

For example, it should not be easy for anyone to simply launch a cryptocurrency. Unless a cryptocurrency meets the basics of the rules laid out by the B100, it would lack B100 certification.

The number one rule ought to be that no matter who you bought the cryptocurrency from, that money does not sit with any one company, but rather sits on top of the Blockchain and thus is indestructible. The company that was your gateway might go out of business, but your money will stay safe. The number two rule ought to be that every person who buys and holds a cryptocurrency must tie it to a valid biometric ID, traceable by the Interpol for law enforcement purposes. You don't want druglords and crime masters to be able to easily move money. That would create havoc.

China, India, and the United States, one of which has already acted, another is about to act, and a third has expressed anxieties at the highest levels, ought to help create the B100.

It necessarily means that the B100 would together create a super-secure database of a digital, globally available, biometric ID for every human being on earth that is collectively owned, created and maintained by the B100, that meets the highest standards of privacy and security, is kept out of reach of governments unless they show up with warrants issued by recognized courts. All ground rules following crypto companies should be able to access that database for transaction purposes.

These concerned governments should not throw out the baby with the bathwater before the baby is even born.

Indian government panel wants cryptocurrency holders jailed, but can’t deny its tech has merits
The Growth of Cryptocurrency in India: Its Challenges & Potential Impacts on Legislation
Facebook's Libra cryptocurrency faces more backlash
Facebook won't launch Calibra or cryptocurrency Libra in India
Move to ban cryptocurrency has Indian blockchain firms worried
Understanding India's Cryptocurrency Crackdown
India's central bank bans financial firms from dealing with cryptocurrency
What is Laxmicoin, possibly the first legal Indian cryptocurrency?
Proposed Indian Ban on Crypto is Even Harsher than China’s
A history of the development of cryptocurrency in India
Has RBI’s Ban On Bitcoin Killed The Future of Cryptocurrency In India?
No Blanket Ban on Cryptocurrencies in India, Government Says
Warning: India is Heading Towards Clueless Bitcoin Regulation, Here’s Why The only concrete steps the world’s sixth largest economy took all these years were: raid cryptocurrency startups, portray bitcoin as a scam via half-baked media coverages, and – to top all – ban its banking sector from offering services to cryptocurrency industry. When the Western economy had moved forward with bitcoin, India started walking backward....... the multifaceted nature of cryptocurrencies. The technology converges multiple disciplines – of securities, currency, and commodities – making it difficult for regulators to assess its exact use case from a user’s point of view. Before the banking ban, RBI and SEBI passed the burden of regulating cryptos to each other, never realizing how they would define the asset class. It is one of the reasons why one cannot help but be skeptical about their intentions to deliver a robust legal framework in four weeks. ...... With any luck, RBI would have realized by now that its banking ban is not working. On the contrary, it has moved the bitcoin market underground. ...... both the regulators would first define how they would separate utility tokens like bitcoin from security tokens like a company-backed equity coin...... In the worst case scenario, SEBI and RBI would call an outright bitcoin ban after taking inspirations from their neighbor China. Practically, that does not change anything for Indian crypto users, which are already trading bitcoin via peer-to-peer methods. However, for an economy that boasts of being the world’s largest IT hub, India will lose a lot that it would gain by shunning an emerging sector.
India's First Cryptocurrency ATM Launched In Bengaluru
India signals ban on cryptocurrencies, embraces blockchain
An Indian government panel wants ‘Digital Rupee’ to replace all private cryptocurrencies The report admitted that the distributed-ledger technology behind digital currencies can have positive effects if deployed in financial services, but their most popular application, cryptocurrencies, have “risks associated with them”. ..... India must consider introducing an official virtual currency, or the “Digital Rupee”, to replace private cryptocurrencies such as bitcoin....... As opposed to traditional ledgers, which store records of financial transactions in a centralised database, distributed-ledger technology uses local electronic ledgers that synchronise and share the data. The elimination of central record keeping makes financial transactions operationally more efficient and secure. ....... “The distributed-ledger technology-based systems can be used by banks and other financial firms for processes such as loan-issuance tracking, collateral management, fraud detection and claims management in insurance, and reconciliation systems in the securities market”....... Private cryptocurrencies “have no intrinsic value and cannot replace fiat currencies”, it added, recommending measures that could potentially destroy the crypto-ecosystem....... The Garg panel recommends penalty and imprisonment for those who directly or indirectly “mine, generate, hold, sell, deal in, transfer, dispose of or issues cryptocurrency”....... private cryptocurrencies have not been recognised as legal tender in any jurisdiction....... Ajeet Khuranna, CEO of crypto-bourse Zebpay, which was compelled to shift out of India last October, said India will miss out on the benefits of distributed-ledger technology.

30-30-30-10: A More Thoughtful And Egalitarian Formula For Equity Distribution In Tech Startups For The Age Of Abundance
The Blockchain: Fundamental Like The Internet
The Blockchain Rumble
The Character Called The Tech Entrepreneur

Inequality And Climate Change Are Existential: A Blueprint For Survival
Towards A World Government
AOC 2028

Tuesday, July 23, 2019

The Unresolved Governance Issues Of Cryptocurrencies

It has to be noted that President Trump recently tweeted a really hostile comment about Bitcoin. The US Secretary of Commerce spoke hostile about the Bitcoin recently. The Bitcoin can not be seen as the American thing. Heck, many prominent House Democrats are skeptical and hostile. You would think the Bitcoin is China. The hostility is bipartisan.

This development in India is not like China banning Facebook, and Twitter, and YouTube, and Google so as to make room for native versions. This development is more like the US government itself banning the Bitcoin if it could. The Bitcoin is utterly not respectful of the dollar or any other currency, and their political statures.

But the Blockchain community has been equally irresponsible in that it has not been proactive about the unavoidable governance issues.

Govt committee recommends ban on cryptocurrency in India The report lays down that all private cryptocurrencies except the ones issue by the state be banned in India and endorses the stand taken by the RBI to eliminate the interface of institutions regulated by the central bank from cryptocurrencies....... The report states that there are around 2,116 cryptocurrencies, Bitcoin like Rippld, Ethereum and Cardano with a market capitalisation of $119.46 billion.

The Aftermath Of India’s Cryptocurrency Ban: Startups, Investors Poke Holes In Govt’s Plan India’s official report on cryptocurrencies has shaken crypto startups and investors ..... the committee is agnostic about exploring the idea of RBI-backed digital currencies and has welcomed the ongoing innovations happening around the underlying technology, known as blockchain. ....... crypto startups and enthusiasts feel it’s a direct violation of Article 19(1)(g) which gives them the fundamental right of freedom to business in any sector or trade. Many of the startup founders and stakeholders were naturally miffed with the decision, and some questioned the logic of the move...... “Report says the government will take all measures to usher in digital economy using Blockchain. By banning Crypto there can never be a public blockchain so the report contradicts itself.”...... by being very risk-averse we will significantly hinder the progress of the industry and would only end up as being spectators of how other developed countries adopted and moving forward with it....... The report cites high volatility, malware used for illegal mining, high use of electricity for Bitcoin’s mining, cryptocurrency’s ability to affect the efficacy of RBI’s monetising capability as among the other primary reasons to recommend a complete ban on cryptocurrencies........ “It’s clear from the report that the government wants to boost distributed ledger technology but they need to understand that you can’t boost DLT like blockchain while completely banning crypto assets.” ...... Many cryptocurrencies, these days, are backed by petroleum, gold, as well as the US dollar in the case of Facebook’s Libra. The IMC does not make any differentiation among cryptocurrencies that are not backed by any central banks. ....... Unocoin’s Vishwanath said the question is to what extent the ban is enforceable as everything happens digitally on the internet. If it cannot be enforced, then there is no point of discussing conviction which means the ban was useless anyway. ...... in February 2018 there were around 50 lakh traders in India in 24 exchanges and cryptocurrency trading volumes are in the range of 1500 Bitcoins a day, or around INR 1 Bn, compared to the global 24-hour trading volume which is in excess of $21 Bn. So there are plenty of stakeholders in the crypto ecosystem........ “Any person shall, on or after the date of commencement of this Act but on or before the expiry of ninety days from the date of commencement, make a declaration in respect of cryptocurrency in such person’s possession and shall dispose of the same within the aforesaid period.” ....... Vishwanath chimed in “It would just be bad news. To literally not hold any crypto assets technically, the users would need to withdraw the crypto assets from exchanges if any into their own wallets and delete their private keys. But this will be the same as throwing money into the fire. ...... if the draft bill gets enacted, in a short time thousands of people will lose their jobs as well as crores of their hard-earned money. India, in the long term, will see an increased brain drain, especially in regard to blockchain or decentralised apps. India will not have blockchain and crypto expertise leading to little-to-no crypto-related work reaching India. And, thus, India will lose billions in investment that the crypto sector can potentially attract and the thousands of jobs that it might create in future....... “There are legitimate concerns regarding crypto-assets, but the report’s recommendation of an outright ban appears excessive. Crypto-assets have benefits as well, which have been recognized globally, including by leading universities like Harvard, global corporations like JP Morgan, and international bodies like the IMF, as well as by previous Indian government reports. Therefore, as we have always recommended, crypto-assets should be regulated to promote the benefits and mitigate the risks.” ...... traditionally courts have taken a stern view on outright bans and have generally advised for measures with a lesser impact, before endorsing complete prohibition. So hope exists for the crypto community in India, but it’s fleeting and time may be running out on cryptocurrency in India.

Government panel recommends ban on cryptocurrency in India

Saturday, July 20, 2019

Africa Is Mars

Mars is undoable. Mars is undesirable. There is this funny thing called gravity. The human body does not do well in the absence of gravity. Send robots. They are gravity neutral. But people? Africa is plenty undiscovered. Plant a trillion trees instead. Save this very planet instead.

When you plant the Australian eucalyptus in a new climate, there is havoc. Imagine a microbe from Mars coming over to earth. What could happen?

The best point for rockets are one step further and one step closer. I am all for robotic mining of the asteroid belt. Countries used to go to war over spices. Gold is the new spice. I am all for internet access on every point on earth through 10,000 or more satellites.

But I am all about Africa, not Mars. Ray Youssef has an edge over Elon Musk in that regard. Mars might be Elon Musk's masterstroke in marketing, not an actual place he wants to go to. Look, Mars! He says. And then builds boring tunnels and exciting cars.

Both Ray and Elon are immigration success stories. Both are out of Africa. Elon might look like he has white skin, but you just have to read his life story to realize the sickness that was apartheid also brutalized him. Elon grew up in South Africa. Ray's parents came from Africa. Ray is a New Yorker. And now Ray is America's gift to Africa. These two inspiring entrepreneurs are in stark contrast to the stupidity emanating out of Washington. So much garbage is being talked about immigration. To Ray I might say, go back to Africa. But looks like he is already there.

Thursday, July 18, 2019

Money Moved, Value Created

The biggest development economics story of my life is something I was never taught in any of the textbooks in high school or college. No development economist, many of whom do originate from the Global South, was able to foresee that remittance will play a much bigger role in development than foreign aid or even trade.

Aid is big, trade is much bigger, but the biggest of them is remittance. And we have to put remittance in a separate category from trade because we have still not achieved that stage in human evolution when we might realize a completely free movement of people all over the world will immediately add a few trillion dollars to the global GDP. Money moves. Goods move. But people get clamped down. That is where we are.

What is remittance? People move from poor countries not always to the richest countries. More often they move to slightly richer countries. They work the lowest-paying jobs. They save money when saving might be thought of as impossible. They pay shark rates to move money. And they send money home. This has been the greatest driver of development in the past few decades. No economist was able to foresee it.

There is enormous value created when you make it possible for people to move money. And that is elemental. That is not even banking. When you make that movement instantaneous and free, the value is so, so much larger. And the Blockchain promises to do that. The Blockchain is going to be more revolutionary than the Internet. The Internet has been the appetizer. The Blockchain is the meal.