“Lloyds Banking Group Plc said on Sunday it would ban its credit card customers from buying Bitcoin and other cryptocurrencies.”
“In a brief statement to Reuters, the Italy-based company said that they had “no interest whatsoever in selling power”to a mining company”
SAN JUAN, P.R. — They call what they are building Puertopia. But then someone told them, apparently in all seriousness, that it translates to “eternal boy playground” in Latin. So they are changing the name: They will call it Sol.
Dozens of entrepreneurs, made newly wealthy by blockchain and cryptocurrencies, are heading en masse to Puerto Rico this winter. They are selling their homes and cars in California and establishing residency on the Caribbean island in hopes of avoiding what they see as onerous state and federal taxes on their growing fortunes, some of which now reach into the billions of dollars.
And these men — because they are almost exclusively men — have a plan for what to do with the wealth: They want to build a crypto utopia, a new city where the money is virtual and the contracts are all public, to show the rest of the world what a crypto future could look like. Blockchain, a digital ledger that forms the basis of virtual currencies, has the potential to reinvent society — and the Puertopians want to prove it.
If you are reading this on January 16, 2018, then you are aware that Bitcoin (and the exchange rate of most other coins) fell by 20% today. Whenever I encounter a panic sell-off, the first thing that I do is try to ascertain if the fear that sparked the drop is rational.
But what is rational fear? How can you tell if this is the beginning of the end, or simply a transient dip? In my book, rational fears are fundamental facts like these:
Conspicuously missing from this list is “government bans” or any regulation that is unenforceable, because it fails to account for the design of what it attempts to regulate. Taxes, accounting guidelines, reporting regulations are all fine! These can be enforced. But banning something that cannot be banned is not a valid reason for instilling fear in those who have a stake in a new product, process, or technology.
Continue reading “Cryptocurency: Thoughts on a ‘Korea Krash’” »
Some blogs and news outlets eschew long titles. Publishers want readers to scan a list of topics that fit on one-line each. But, a better title for this article would be:
“Massive electric consumption by cryptocurrency mining:
An unfortunate environmental nightmare will soon pass!
… Proof-of-Work alternatives are on the horizon”
A considerable amount of electricity is used in the process of mining Bitcoin and other cryptocurrencies. Miners are effectively distributed bookkeepers, and this use of resources is part of a system called “proof-of-work”. It keeps the books fair, honest, and without an ability for the miners to collude (In other words, they cannot ‘cook the books’).
Today, editors at Quora asked me to answer a seemingly simple question:
This is a terrific question, and one that I write about frequently. The question gives me a chance to summarize the key facets of widely mistaken fears. But, here, in the Lifeboat Blog, there is room to elaborate a bit.
In the first phase of cryptocurrency adoption (we are in the midst of this now), there is an abundance of skepticism: Misunderstanding, mistrust, historical comparisons that aren’t comparable, government bans & regulatory proposals—and a lot of questions about intrinsic value, lack of a redemption guaranty, risky open source platforms, tax treatment, etc, etc.
By now, every interested news-junkie is aware that Bitcoin plummeted from $15,000 to $13,000 (USD exchange rate) on January 11, 2018. This morning, every news outlet and armchair analyst attributes the drop to the Korean government signaling that it will ban Bitcoin trading among its citizens.
With Donald Trump and Kim Jong Un butting heads over nuclear missile tests and the upcoming Winter Olympics, you would think that South Korea has other priorities than banning Bitcoin.
As with all news—except accidents—the Korean plans were known by a few insiders (in this case, government bureaucrats), and so the influence on value was bigger than the drop that occurred after the news story. In the days before this “event”, it was probably responsible for a drop of about $4500 in exchange value.
Listen up Wild Ducks! We have heard this before. On Sept 11, China announced the exact same thing. I wrote about it in the most popular article of my 7 years as Blogger: Bad News is Good News for Bitcoin Investors.
Continue reading “Say it again, Bitcoin Investors: ‘Bad News is Good News’” »
I get this question a lot. Today, I answered it at Quora.com. But, here, in the Lifeboat Blog, I have more bandwidth to elaborate.
Question:
What if I make a typo when sending Bitcoin. The recipient address
may be invalid or it may belong to another individual. —But there
is a third possibility. Couldn’t it be a valid address, but without any
wallet that can receive it? I bet the blockchain catches these errors
—Right? Will I always get my money back?
The short answer: “Don’t worry, it cannot happen. That won’t happen either. Sure, it’s possible. That’s wrong, and You’re screwed!”
Continue reading “What if you Send Bitcoin to a Non-Existent Address?” »
