Wednesday, March 09, 2022

Kathryn Haun: Maverick VC





Exclusive: Why star VC Katie Haun departed Andreessen Horowitz with an audacious plan to build a $1 billion crypto investing juggernaut The a16z vet made her name with big bets on Coinbase and OpenSea. Her new venture is on track to be the biggest Web3 fund raised by a solo female VC. .

Katie Haun Seeks $900M for Crypto Funds After A16z Departure: Report Haun is aiming for $300 million for an early investment fund targeting crypto startups and $600 million for a fund focused on larger companies and digital tokens.

Crypto’s Top V.C. Is Playing the Long Game Katie Haun, a co-chair of Andreessen Horowitz’s new $2.2 billion crypto fund, is betting that the blockchain will be as big as the internet. ....... A top crypto cop turned venture capitalist is now one of the most powerful women in Silicon Valley, with more than $2 billion at her fingertips. ....... Katie Haun, who created the first federal cryptocurrency task force as a prosecutor in the Justice Department, will co-chair a $2.2 billion crypto fund Andreessen Horowitz announced this week. She is a general partner at the venture capital fund and an independent director at the crypto exchange Coinbase. Chris Dixon, also a general partner at Andreessen, will be the fund’s other co-chair. ........ A Chinese regulatory crackdown on Bitcoin is battering prices and raising questions about the value and future regulatory landscape of crypto. .............. Xi Jinping and China have made no secret of the fact that they consider crypto and blockchain a top-five national priority for China in the next decade. They’ve publicly stated this, and they are developing their own version of cryptocurrency, a digital renminbi. We know that they plan to export this, to tie trade to it, to incentivize people around the world, not just in China, to use it. ............

the tremendous staying power of a decentralized, open system like Bitcoin.

......... There’s this myth that crypto founders want the Wild West. They’re really kind of desperate for regulators to say what the rules are. It takes so much time, money and resources — specialty resources — to figure out how to navigate the morass of agencies ranging from the C.F.T.C. to Treasury, let alone the regulators in 50 different states. .......... I’m full-time in the industry with experts all around, and I can’t keep up with the pace of this technology that’s changing so fast. ............ anyone today with an internet connection and a VPN can pretty easily go access products and services that are offered in other countries. It’s incredibly hard, if not almost impossible, for the U.S. to police what’s happening overseas on offshore platforms......... Criminals are early adopters and in some ways they make great beta testers for new technology. They’re always looking for a way around the system. Frankly, law enforcement officials actually really like when payment is made in Bitcoin as opposed to fiat. I think it’s funny because as a former prosecutor, I take this for granted. There’s a real false sense of security where wires are used or traditional financial services are used. People think, “Oh, we know everything about that. So we’ll just go subpoena. The bank will give us these records and we’ll just go get the money.” That is just so far from the reality of the situation. .......... I prosecuted many of the Justice Department’s largest online money laundering schemes. In fiat systems, 99.9 percent of money laundering claims succeed. Actually, the thing that really stands out about the ransomware attacks — the Colonial Pipeline is a great example of this. It is unprecedented that the Justice Department would be able to recover the proceeds from international criminal activity so quickly. ........

One of the only things that unites Congress lately is China

, and I think U.S. policymakers and lawmakers are starting to realize that China and other countries are moving forward, recognizing that crypto and blockchain is a real priority, and that we are behind, unlike in the internet, where DARPA and the U.S. government had a hand in helping create it. ............. There’s something fundamental going on right now with the internet and culture, and I think crypto is at the epicenter. .......... A lot of people that I talk to about NFTs think, “oh, yeah, digital art.” I think it’s so much more than just about art. It’s about much more than gaming, it’s about much more than goods. It’s about this new business model for creators and bringing entirely new audiences to crypto, entirely new types like creators, sports fans and media types......... Then the third category is DeFi or decentralized finance. ......... With crypto, we think that its potential for growth is as big as the potential for the internet.





Katie Haun on the Dark Web, Gangs, Investigating Bitcoin, and the New Magic of “Nifties” (NFTs) (#499) . Previously, she spent a decade as a federal prosecutor with the US Department of Justice, where she focused on fraud, cybercrime, and corporate crime, alongside agencies including the SEC, FBI, and Treasury. She created the government’s first cryptocurrency task force and led investigations into the Mt. Gox hack and the corrupt agents on the Silk Road task force. ....... While serving as a federal prosecutor with the US Department of Justice, she also prosecuted RICO murders, organized crime, public corruption, gangs, and money laundering. She held senior positions at Justice Department headquarters in both the National Security Division and attorney general’s office, where her portfolio included antitrust, tax, and national security. Katie has testified before both houses of Congress on the intersection of technology and regulation. .......... She teaches a class on cryptocurrencies at Stanford Business School and previously taught cybercrime at Stanford Law School. ....... Katie clerked for US Supreme Court Justice Anthony Kennedy and is an honors graduate of Stanford Law School. She is a lifetime member of the Council on Foreign Relations. ....... Katie gives us a rundown of how blockchain technology both powered the Silk Road darknet market and dropped the breadcrumbs that led to its downfall — as well as the arrest of the corrupt agents who were exploiting the investigation for their personal enrichment. .......... As a federal prosecutor, Katie never lost a case. ...... While working to put violent criminals behind bars, what was the self-talk that kept Katie level-headed when risks to personal safety were of valid concern? How large are these criminal organizations, and how much reach do they have in the outside world? ........ What developments does Katie expect to see in crypto or blockchain over the next three to five years? .





From Crimefighter to ‘Crypto’: Meet the Woman in Charge of Venture Capital’s Biggest Gamble Kathryn Haun was the Justice Department's go-to prosecutor for Bitcoin-related felonies. Now she's one of cryptocurrency's most important investors. Here's why her career change is a watershed moment...... In one corner is Paul Krugman, the New York Times columnist and Nobel laureate in economics. In the other is Kathryn Haun, an accomplished federal prosecutor recently turned venture capitalist. .

Federal Prosecutor Kathryn Haun On How Criminals Use Bitcoin -- And How She Catches Them . The first time federal prosecutor Kathryn Haun heard about Bitcoin was when someone asked her if she’d like to prosecute it. ....... The assistant U.S. attorney for the U.S. Department of Justice in San Francisco, who had previously focused on organized crime, prison gangs and murders, very quickly realized that wouldn’t be possible — that it would be like “trying to prosecute cash,” but it set her off on a path of discovery. She is now also DOJ’s digital currency coordinator, teaches Stanford Law School’s first class on digital currency and cybercrime, and, last year, put away two federal agents who tried to steal more than $800,000 in bitcoin. ......... begins with her being tipped off by an investigative journalist about one of those agents ....... when I started looking into this matter, I was doing it from the perspective of, I want to clear this person’s name, but I quickly learned that wasn’t going to be the result.” ........ She describes how she uncovered what were actually “the perfect criminals” — being federal agents, “they knew how to cover their tracks,” she says. ......... she was able to follow the bitcoins, how tracking those patterns revealed to her that there were two dirty federal agents, not one, and what telling detail led her to suspect the second must also be a federal agent. ........ she thinks it would be particularly revolutionary in the area of public records. “Of all the kinds of cases that I’ve ever done, whether you’re talking about the Hell’s Angels, marriage fraud, the bank officer I prosecuted for impersonating dead people or the criminals I’ve prosecuted using cryptocurrency, they all have one thing in common: there’s always been, somewhere along the way, a forged, counterfeit or stolen public document — even a murder case I tried,” she says. ........ in the United States, more than 6,500 entities can issue birth certificates on 14,000 different types of forms, making it easy to counterfeit a birth certificate. “We call these ‘breeder documents’ — because they quite literally breed new identities,” she says. “You get a forged, fake or stolen birth certificate and a name, and you take that down to the DMV and you get your photo taken with that, and now you all of a sudden also have a driver’s license. You take the driver’s license and birth certificate to the passport office and now you’ve gotten yourself a passport. And all of a sudden, with these three kind of identity documents, the sky’s the limit on what kind of criminal activity you could do — you could file for fraudulent benefits from the government, you could commit some kind a terrorist offense, you could purchase weapons, you could traffic in people, you could obviously commit drug smuggling.” ............. Another problem she sees in public records is that they are kept in centralized databases, which are subject to tampering. For instance, in 2008, the city of San Francisco’s network administrator became disgruntled and changed all the admin passwords and held all the records hostage. .

LinkedIn

Biden Takes Step Toward Regulating Cryptocurrencies The president signed an executive order that will coordinate efforts among financial regulators to better understand the risks and opportunities presented by digital assets...... President Biden signed an executive order on cryptocurrencies Wednesday, in the face of “explosive growth” in digital assets.Credit... ......... President Biden signed an executive order on Wednesday that will direct the federal government to come up with a plan to regulate cryptocurrencies, recognizing their popularity and potential to destabilize traditional money and markets. ......... The order, under development for months, will coordinate efforts among financial regulators to better understand the risks and opportunities presented by digital assets, particularly in the areas of consumer protection, national security and illicit finance. ....... The order lays out a national policy for digital assets across six areas: consumer and investor protection; financial stability; illicit finance; U.S. leadership in the global financial system and economic competitiveness; financial inclusion; and responsible innovation........ “We’re operating in a gray zone and in a sandbox. And time and again, someone comes into the sandbox and arrests somebody, and that’s not the best way to grow an important part of the economy.” ........ “We’ve seen a complete lack of any strategic direction or thought from the federal government for years. The industry still doesn’t know what’s a security, for example, and what’s a utility token that is exempt from regulation. Those are things that would help us.” .

Crypto-related companies and funds jump after Biden signs executive order on cryptocurrencies
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Crypto And Climate Change

Those of us who believe in the science of climate change think of this as something existential. A few degrees of warming and earth becomes uninhabitable. There is chaos. If the monsoon were to leave South Asia, what would happen? Climate change could do that. It is an unthinkable scenario.

I have argued for years inequality is similarly existential. And the solution there is crypto. We need the Blockchain to empower individuals everywhere, to democratize money, to narrow the inequality and make it manageable.

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Monday, March 07, 2022

Regulating Crypto

Can The Government Regulate Cryptocurrency? . we first must understand that Bitcoin and most other ICO issued tokens are in fact decentralized. ........ the supply of cryptocurrency tokens is not set by a central authority or government. It also relates to cryptocurrencies as a medium of exchange. Transactions using the blockchain can be conducted, authenticated, and recorded in the public ledger without third party interference. ........ The number one way that the government could regulate cryptocurrencies is by taxing any fiat money you use to cash out a virtual token. The main caveat with this is that this would have to apply to specific tokens and a cryptocurrency owner could simply turn to another coin to cash out. Beyond this, many early adopters and hardliners prefer cryptocurrencies as medium of exchange for basic goods and services over traditional fiat currencies. ................ Right now, cryptocurrencies fall under the jurisdiction of the SEC for investment, the CTFC for any crimes involving interstate commerce, and the IRS, making it subject to either income or a capital gains tax. .......... the CTFC recently subpoenaed major crypto exchanges Bitfinex and Tether because Tether couldn’t verify over $2.3 billion in reserves ......... Much of the proposed regulations being mulled around the world comes on the fears of a dangerous speculative bubble that many fear could harm the nation if cryptocurrency commodities tumble. ........ Less transaction fees than credit cards or most major financial instruments ........ No paperwork for investing in a token, unlike a share ........ The biggest problem with current monetary policy is that federal interest rates are arbitrary issued and the creditors have no interest in controlling the supply of money. .......... No matter your opinion over the cryptocurrency craze, it has

the potential to completely disrupt monetary policy across the globe

. With hundreds of new tokens offered each month, it seems as though the effort to regulate cryptocurrencies will forever remain a game of cat and mouse. .



Regulation By Enforcement And Crypto Assets . In November 2021, the SEC Chair Gary Gensler delivered his remarks at the Securities Enforcement Forum and stressed enforcement as a “fundamental pillar in achieving the SEC’s mission” to safeguard investors. ....... “legislative priority should center on crypto trading, lending, and DeFi platforms” so as to bring “the field of crypto” within regulatory frameworks comparable to those already in place for conventional securities ......... Given the broad range of “crypto” assets, it is hardly surprising that such digital assets fall under the responsibility of an alphabet soup of regulatory bodies and agencies – the SEC, the Commodity Futures Trading Commission (CFTC), the Financial Crimes Enforcement Network (FinCEN), the Office of the Comptroller of the Currency (OCC), and individual state authorities. Digital assets are challenging to define and impact different aspects of the financial service industry. Indeed, some in the traditional financial services refuse to refer to crypto tokens as currencies. For example, Jamie Dimon recently said that he no longer uses the word cryptocurrency. Regardless, blockchain-based products and services were designed, at least in part, like other FinTech products, to disrupt the traditional financial service industry and no one can contest the disruption they have caused, regardless of what you call them. ........ The innovative, disruptive potential of crypto assets is a source of regulatory concern, which is why there have been increasingly vocal calls to step-up regulatory efforts in connection with the crypto sector. These calls are legitimate, but to whom should they be addressed? ........ the price tag of what is at stake, given the massive growth of the crypto sector. ......... when Bitcoin and Ether (the world’s two largest cryptocurrencies) surged to record highs in November 2021, cryptocurrencies hit a market cap of $3 trillion for the first time. Then, in January 2022, cryptocurrency prices fell sharply, including Bitcoin which plunged 50% from its all-time high. That level of volatility in such a large market is a cause for concern regardless of whether you call the underlying crypto-asset an asset, a security, a currency, or a token. ........ Lawmakers have been pushing for the regulation of decentralized exchanges in an attempt to fight rug pulls, which enable a cryptocurrency coins’ creators to deprive the coins of liquidity, causing unwitting investors to basically lose all of their money. .......... Clear regulatory guidance is crucial to the growth of the industry, and regulation by enforcement, or threat of legal action, risks driving business outside of the U.S.” ......... With the rise in abuse, manipulation and fraud in the crypto industry, the SEC is interested in taking immediate (and much needed) action. Several months ago the SEC put the crypto industry on notice by sending Coinbase, the largest U.S. crypto exchange platform, a warning letter that the SEC would sue the company if it moved forward with a planned lending product. The SEC took similar actions last year when BlockFi faced SEC scrutiny over high-yield crypto accounts. Somewhat similarly, BlockFi along with Celsius were also the subjects of earlier enforcement actions by state securities regulators. These lawsuits, letters and warning of enforcement by federal and state agencies underscore the tense legal debate regarding the preferred regulatory approach towards the financial industry in general, and in particular, towards the growing crypto sector – regulation first and enforcement later, or regulation by enforcement? ............ Massive amounts of money have flown into crypto, requiring regulators to keep up with the technology in real-time in order to close risk gaps as much as possible. Tasked with this mission impossible, regulators must remain cautious to work with industry players. But the enforcement first approach, does not facilitate cooperative action between regulators and industry. Instead, regulatory agencies should regulate first and then enforce the law second, reserving to themselves, as former Secretary Geithner suggested, the ability to make adjustments to regulations after the fact in cases where flexibility is needed. ........... “The SEC famously keeps a large shotgun behind the door to keep markets in line. It can be judicious in its use of enforcement power and fire some warning shots before leaving some business lying dead in the street” .

U.S. Officials Send Mixed Messages on Crypto Regulation. Here’s What It All Means for Investors . One of the founding principles of cryptocurrency is that it’s decentralized and unregulated. But the U.S. government isn’t too worried about crypto’s founding principles. .......... a few key themes have emerged on the subject of new U.S. cryptocurrency regulation: stopping cryptocurrency crime and tax evasion, stablecoin regulation, and the potential for investment vehicles like crypto ETFs and other funds. ........ For many crypto enthusiasts, the decentralized nature of digital currencies — which, unlike traditional currencies, aren’t backed by any institution or government authority — is a big draw. But regulatory guidance can help protect investors. “As much as I like the decentralization and the lack of government [involvement], I am glad that they are paying attention because unfortunately with cryptocurrency, there are a lot of scams” .......... One possible provision would expand the definition of a brokerage to include companies that facilitate digital asset trades — like cryptocurrency exchanges. This kind of change would mean increased tax reporting responsibility to help the IRS track crypto tax evasion. .......... cryptocurrency “poses a significant detection problem by facilitating illegal activity broadly including tax evasion.” ........ Under a potential new law that has been considered by lawmakers, companies that facilitate crypto trades would be required to report tax information about those trades to the IRS (just as brokers of traditional investments like stocks do) starting in the 2024 tax season. ........ if the bill passes, exchanges will have to issue 1099-B tax forms with cost basis information to investors.” ........ It’s already important to keep your own records of any capital gains or losses on your crypto trades, which you should report on your federal tax returns. ....... Stablecoins are a type of cryptocurrency pegged to an existing currency, like USDT (Tether). USDT is tied to the price of the U.S. dollar, so its value is constantly $1. ........ many established, high-volume U.S.-based exchanges, like Coinbase and Gemini. ....... The Investing Companies Act requires companies, including mutual funds, to disclose information about their finances and investments on a “regular basis” ......... every initial coin offering (ICO) he has seen is a security: “Generally, folks buying these tokens are anticipating profits, and there’s a small group of entrepreneurs and technologists standing up and nurturing the projects … I believe we have a crypto market now where many tokens may be unregistered securities, without required disclosures or market oversight.” ........... the SEC has jurisdiction, and “our federal securities laws apply.” .



The Challenges of Regulating Cryptocurrency The S.E.C. has yet to set clear rules on cryptocurrencies, leaving the industry guessing. Maybe that’s just how the agency wants it. ........... he turned to cryptocurrency markets, which are notoriously volatile, and adopted a darker tone. “Frankly, as I’ve said before, I think it’s more like the Wild West,” Gensler said. On another occasion, he had described cryptocurrency investments as “rife with fraud, scams, and abuse.” ......... The S.E.C. has so far failed to keep up as thousands of tokens and digital currencies have been introduced, and new companies and platforms have emerged to help store and trade them. The lack of regulations over this burgeoning area has created an opening for widespread fraud .......... After leaving the C.F.T.C., in 2014, Gensler worked as a professor at M.I.T.’s Sloan School of Management. During his time there, much of his teaching focussed on cryptocurrency. His first class, “Blockchain and Money,” covered the development of blockchain and its potential uses. .......... One of the biggest questions facing the industry is whether tokens—which are tradable assets that may serve as the units which denominate cryptocurrencies but can also represent other things of value—qualify as securities; if so, they would be subject to securities laws and regulations.

And if they aren’t securities, what are they?

......... around 2017, as a frenzy of initial coin offerings—a fund-raising strategy for cryptocurrency that resembles an I.P.O.—was in full swing, a client came to his law firm wanting to know what the S.E.C. thought about I.C.O.s, and whether the agency considered digital coins to be under its purview. Morgan said, jokingly, that his first question was, “What’s an I.C.O.?” He quickly learned that there was little S.E.C. guidance available. ........ Jay Clayton, at a Senate hearing: “To the extent that digital assets like I.C.O.s are securities—and I believe every I.C.O. I’ve seen is a security—we have jurisdiction and our federal securities laws apply.” ........... Ripple argues that XRP is a currency, which would make it subject to different laws and regulations overseen by different agencies—such as the Office of the Comptroller of the Currency or the Financial Crimes Enforcement Network, which are both part of the Treasury Department. Ripple has taken to Twitter to defend itself, in addition to making its arguments in court. ............ Part of its strategy seems to involve trying to embarrass the S.E.C. over the agency’s apparent contradictions surrounding cryptocurrencies. ......... Coinbase ...... According to the company, its executives had been “​​proactively engaging” with the S.E.C. for six months, to clarify the legal standing of its projects, but it “didn’t get much of a response.” It also said that the S.E.C. had so far refused to clarify whether it considered the act of lending cryptocurrency a security, or whether the cryptocurrency itself was the security, and any other aspects of its reasoning. .

Global Crypto Regulation Should be Comprehensive, Consistent, and Coordinated . The IMF’s mandate is to safeguard the stability of the international monetary and financial system, and crypto assets are changing the system profoundly. .......... While the nearly $2.5 trillion market capitalization indicates significant economic value of the underlying technological innovations such as the blockchain, it might also reflect froth in an environment of stretched valuations. ........ in emerging markets and developing economies, the advent of crypto can accelerate what we have called “cryptoization”—when these assets replace domestic currency, and circumvent exchange restrictions and capital account management measures. .......... Crypto’s cross-sector and cross-border remit limits the effectiveness of national approaches. ............ many crypto service providers operate across borders, making the task for supervision and enforcement more difficult. Uncoordinated regulatory measures may facilitate potentially destabilizing capital flows. .

Will Cryptocurrency Regulation Affect Crypto Prices? This price-sensitive asset class could have either a positive or negative reaction to regulation. .

The crypto regulation era is here . .

Regulators put cryptocurrency in crosshairs Business School professor offers look at landscape and challenges for industry, government .





Federal Reserve: Money and Payments: The U.S.Dollar in the Age of Digital Transformation (40 pages) .

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Sunday, March 06, 2022

The Purpose Of Crypto Regulation

The primary purpose of crypto regulation ought to be to make innovation and business possible. There are plenty of operations that call themselves crypto but are shady, deceptive, and outright fraudulent. It is for regulation to protect the true innovators from those that give the space a bad name. Weed out the bad guys.

There is great danger that Barnes And Noble might attempt to hobble Amazon because, in 1994, Barnes And Noble had gobbles of money, and Amazon had none, and Capitol Hill is pay as you go. In 2009 we saw Wall Street walk away with murder. The moneyed interests of the old might get in the way of the new. And their nefarious attempts might have the legitimacy of misguided regulation. The new innovators have to get into the political fight. They have to be part of the debate. They have to be in the arena. They have to show up on the Hill, and they have to show up in the court of public opinion.

The primary purpose of crypto regulation ought to be to make business possible.

There is a line of thought, and I subscribe to it, that America is a different kind of country. I am plenty critical of the US political system as it exists today, it is an imperfect union, but at the bottom of it I do believe America is an idea, this oldest modern democracy carries the unique responsibility of holding the torch in the far corners of the world. You could spend 700 billion dollars every year on guns and trillions on forevermore wars, you could spend hundreds of billions on diplomacy, or you could, at no direct cost to you, let crypto do the work of empowering individuals everywhere. The Blockchain is about empowering individuals everywhere, and this is much more fundamental than voting rights. The suggestion is that the individual right here in the US is not sufficiently empowered. The entrenched status quo will come by the way of regulations to stop the unstoppable work of empowerment. And that worries me.

It is said when they first started making movies, they would simply capture plays with movie cameras. It was some time before they realized the movie can be its own product. Blockchain native products and services can not be captured with regulations that were designed for the previous era unless the idea is to suffocate the innovation.

I think the best way to regulate will be to bring the cat to the table. The top 100 crypto companies around the world by market cap should form a consortium, perhaps to be called Blockchain100, that will each send a Chief Policy Officer to it, and together they will suggest laws and regualtions to national parliaments around the world, of course, to be debated by elected officials and the general public, but spearheaded by those in the know. Because ultimately it is about the consumers. The most successful crypto products, by definition, will be those that are effortlessly understood.

How do you solve identity? Most people on the planet lack identity that they can take to the bank. How do you solve credit history? The dollar a day people are the best at paying loans, but nobody gives them loans. How do you solve that? Sidewalk businesses around the world have no bookkeepers, and because they don't, they can't go to banks and get loans. How do you make it possible for their excellent businesses to easily get loans? The SEC is not even asking those questions. Crypto has the solutions. And so the SEC should know when to stay out of the way.

The Blockchain is a concrete promise that every single transaction can be completely traced. That is not a place where criminals can go to hide. That is a place where criminals will find it impossible to hide. But we don't want a surveillance regime. And so regulation will have to be able to do it just right. That is a challenge. Engineers are not lawmakers. We pay lawmakers fat money. They might as well rise up to the challenge. They should know when to lead, follow, or get out of the way. Or we should hire a new set.

The Blockchain will take democracy to every country. The SEC, the IRS, the CFTC, FinCEN, the OCC, and that entire alphabet soup does not even have it in their vocabulary to attempt something like that. The thing is, the Blockchain is unstoppable. Regulatory agencies don't want to be like the emperor who went to the banks of a flooding river and asked it to stop. He thought emperors are supposed to command, and the commands will be obeyed.





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Coinbase Should Stay Put And Rescue Russia

Coinbase
Ukraine Is Putin's Brexit With Too Many Dead Bodies
March 4: Ukraine
Twitter: March 2: Ukraine
Kharkiv
Putin Wants To Do A Syria In Ukraine And Can Not Be Allowed
YouTube: February 28
The End Of The Road For Putin
February 28: Ukraine
Legitimate Russian Grievances
I Am No American Mouthpiece On Ukraine
YouTube: February 27
Human Warfare Is People Coming Out Into The Streets Of Moscow In Large Numbers
February 27: Ukraine
Madman Putin And The Nuclear Sword: The Putin Regime Must Collapse
February 26: Ukraine, Justice Jackson
Hybrid Warfare, Meet Human Warfare
The Endgame In Russia
Putin Is Saddam With The WMDs
News: February 22: Ukraine

Putin has gone all in. He has gone medieval. And the thought was wars have gone out of fashion in Europe.

Wars are tragic. Even just wars are tragic. There is damage to limbs, life, property.

I think Putin is going to lose. That is for sure. What is less certain is how soon that will happen. It could be painfully long.

Putin's move feels irrational. I think this is the end of the Putin regime. It has lasted over 20 years. That is long enough.

Ukraine was the mini Russia. There was corruption, but it was still a democracy. It was building a market economy. Singapore was the mini China. Deng Xiaoping had the humility to learn. Putin's hubris has beem to bomb.

The Soviet Communist Party vacated the scene. Now it is the KGB's turn to go.

I think the number is 500,000. If half a million Russians were to brave the streets of Moscow, Putin is over.

A democratic Russia should collaborate with the US to cut nuclear weapons by more than 90% by the end of the decade.

Russia is a major power. It will be a major power. But the currency for power these days is how your economy is doing. Russia naturally will have a sphere of influence; every large country does. But that influence respects the sovereignty of the small countries in the neighborhood. Trade, not war.

Putin is not fighting the US. Putin is fighting China. Putin wants China to think it is Russia that is the number two country. That has not been true for decades. It is now China that competes. And China competes primarily economically.

A debate has flared up. What should crypto companies do? Several arguments can be made both ways. But I think one big argument for staying put is that if ordinary Russians can upload their assets on to the blockchain, they can vote with their feet. Or even if they stay, as most will, the Russian rouble weakened will politically weaken Putin.

And there is also the aftermath. The post-Putin scenario also has to be worked out. The last time around the West did not do a good job of helping Russia transition. The price for that is being paid three decades later.

YouTube: February 19
New York Times: February 16: Hong Kong, Omicron, Trump, Bhutan
February 12: Russia, Ukraine, Lead
If Russia Invades Ukraine, Questions Arise Over Taiwan





Crypto Is Helping Both Sides in Ukraine Conflict, But It Won’t Wreck Russian Sanctions . Several days after the Russian invasion, Mykhailo Fedorov, vice prime minister of Ukraine and minister of digital transformation, called on people around the world to show solidarity with Ukraine by making crypto donations. ........ At the time of writing, donations have exceeded $50 million. ...... It shows individuals collectively having a state-like impact on the global stage. ....... This new way of accessing global private capital is a refreshingly welcome facet of cryptocurrencies. By going straight to the people of the world, Ukraine’s government has been able to raise finance quickly without the need for financial intermediaries. ......... They also have the potential to help Russians to evade the crashing rouble ........ One leading Twitter user, David Gokhshtein, replied that he is “definitely with Ukraine and for peace but we don’t do that in crypto.” .......... Changpeng Zhao, founder of leading exchange Binance, has said that it’s not the place of crypto exchanges to restrict Russian activities in general, though he emphasized that his exchange was not permitting any of the hundreds of wealthy Russian individuals on western sanctions lists to use its services. Even then, he said, it was impossible to stop them because there were so many other exchanges that they could use instead. ........ Russian demand for crypto may help to explain rising crypto prices early last week too. ....... Countries such as Iran have previously been accused of using bitcoin to bypass sanctions. Nonetheless, as the global community looks ever more fractured by ideology and past grievances, concerns about Russia are of a different order. .......... In my view, however, it is doubtful that crypto will save Russia from sanctions. Even apart from the huge task of establishing the necessary facilities within Russian banks, many of the people and institutions that would be receiving the crypto would need to set up wallets of their own. Besides that, daily transaction values in crypto only amount to a few billion dollars. This is a big number, but an order of magnitude less than the overall financial system. If Russia were to seriously start using crypto for payments, the market is not yet mature enough to cope. .......... thanks to the devaluation of the rouble, bitcoin has now eclipsed it in overall value.

It is now the 14th most valuable currency in the world, three places above the rouble.

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