Can Cryptocurrencies Ever Become Reliable Means of Exchange?

This is the third article in the Impakter magazine series about Bitcoin. Written by my sociologist friend Hannah Fischer-Lauder, it explores the question of what is needed to make cryptocurrencies usable as means of exchange. Here’s the beginning:

On 23 January, Stripe, the major firm that supports Bitcoin payments – it does so for more than 100,000 businesses online –  announced that it would start winding down its support immediately and stop all transactions by 23 April.

A thunderbolt in a clear blue sky that caught many Bitcoin investors unprepared, did it mark a watershed in the history of digital currencies?

The above describes Stripe services (September 2015) SOURCE: Kineticgrowth.com

If Bitcoin cannot be used as a means of exchange in a potential market of 100,000 businesses, then, surely, it is the end of its role as a currency – after all, enabling transactions is one of the two fundamental roles of currencies. The other is acting as a store of value. And we all know how that went, with Bitcoin’s infamous volatility.

Let’s put the Stripe decision in perspective.

Read the rest on Impakter, click here.

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Bitcoin World: What Next?

I’m starting a series on cryptocurrencies, this is the first article, just published on Impakter:

ICOS: THE RISKS AND HOW TO ADDRESS THEM

 



Recent good news got lost in the midst of a flurry of bad news that shook the Bitcoin world at the end of January, causing a meltdown, with Bitcoin losing two-thirds of its value since hitting a peak of $20,000 in mid-December. Professor Roubini told Bloomberg that Bitcoin is “much worse than the Tulip mania”, that it’s the “mother of all bubbles”. At the time of writing, Bitcoin is still crashing, with no end in sight, though it is still significantly higher than the $900 value recorded a year ago (January 2017).

Among the avalanche of chilling events: the $530 million hack of Coincheck, a Japanese cryptocurrency exchange followed by a raid on the exchange by the Japanese authorities to check whether they had enough funds to repay customers; the Facebook ban on cryptocurrency ads; India’s Finance Minister declaration that cryptocurrencies would not be recognized as legal tender; the subpoena U.S. regulators sent to two of the world’s biggest cryptocurrency players, Bitfinex exchange and Tether, arousing suspicions of price manipulation; the announcement by major American banks (JP Morgan Chase, Bank of America and Citigroup) followed by a UK bank (Lloyds) that, starting in February, they would no longer allow their clients to purchase Bitcoin with credit cards; South Korea Customs Service’s disclosure of illegal Forex tradings of some $600 million worth of cryptocurrencies; North Korea accused of hacking cryptocurrencies and stealing billions of wons;  the finding by a leading cyber security firm that hackers make on average $100 million a year stealing from “miners”.

And yet amongst the wreckage there was some optimistic news. One was the declaration on 31 January from the South Korea Finance Minister that there was no plan to outlaw digital coin trading, which countered an earlier ban announced by the Minister of Justice in September last year.

The other came from the South China Morning Post that announced on January 31 that the Hong Kong authorities would not ban cryptocurrencies but launch in March “a campaign to educate the public” highlighting that “cryptocurrencies have fluctuated in price, are not backed by any physical commodity or the issuer, and are subjected to hacking risks.” Leo Weese, chairman of the Hong Kong Bitcoin Association, is strongly supportive: “We should know the difference between what makes a good ICO [and what doesn’t]” he said, “and how we differentiate between scams and legitimate projects.”

He has good reason to feel this way: ICOs (Initial Coin Offerings) are the vital lymph of cryptocurrency exchanges and for them to function well, there needs to be trust in their legitimacy.

Read the rest on Impakter, click here.

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Bitcoin: The First Digital Ponzi Scheme

If you had invested $100 in Bitcoin in 2011, two years after it was invented, and if you had held onto it through the 2014 crash, when Mt. Gox, the biggest Bitcoin exchange, collapsed, today you’d have (almost) $4 million in your pocket.

That’s what the Winklevoss twins of Facebook fame and founders of the Gemini exchange did: They are, historically, the first believers and biggest investors in Bitcoin and today, now that they’ve turned bitcoin billionaires in 2017 (the only ones so far), they continue to believe in it, saying they won’t give it up, that “long-term, directionally, it’s a multi-trillion dollar asset”.

2017 was a special year. By December, the valuation of Bitcoin and the 700+ digital currencies that it has spawned had grown explosively, from less than $1,000 per bitcoin to over $15,000. 2018 is not looking so good, market cap is falling, but still high:

As shown above: By end 2017, total market capitalization (value) of all digital currencies exceeded $750 billion, though it is now falling fast and stands well below that value (520 billion on January 17, 2018): this is still and extraordinary multiple (16 times) of where it was a year ago SOURCEGLOBAL MARKET CAPITALIZATION CHART 28 April 2013 TO 17 January 2018 

On 17 January, Bloomberg spoke of a 26% slump noting that “traders brave the volatility” though some (rightly) worry about the growing threat from government regulations.

SO WHERE ARE WE GOING WITH BITCOIN?

To find out, read the rest on Impakter, click here.

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2017: The End of the American Century?

In this article, I try to figure out where we’re going, after the tsunami  brought about by Trump. I am not optimistic but I’m not as pessimistic as some, as you’ll see if you read the article to the end…Happy 2018, we need to continue the resistance, I’m convinced the pre-Trump world order can be revived and American leadership regained!

HOW AMERICA LOST WORLD LEADERSHIP

IN 2017, AMERICA ABRUPTLY CHANGED FACE. IT BECAME A DEEPLY DIVIDED COUNTRY NO LONGER INTERESTED IN WORLD LEADERSHIP. THE QUESTION IS: WHO WILL DOMINATE NEXT, CHINA, EUROPE, RUSSIA? OR IS AN AMERICAN RENAISSANCE POSSIBLE?

Trump’s inaugural speech with its America First message shook the world. And he has kept it up with alarming tweets, insulting and threatening people and countries, sowing confusion among America’s allies and foes. His emotional and erratic tweeting may not add up to a credible foreign policy, he is, in his first year, the least popular President in US history and has signed fewer laws than Obama, yet, with support from the Republican Congress, he has brought deep change: He has successfully turned America in on itself and ushered an age of small government and Big Business.

American institutions are now in the hands of the Republican party. Control over the Supreme Court was achieved with Trump’s appointment of Judge Gorsuch and federal district courts are now filling up with young judges wedded to conservative views. Federal environmental protection regulations are dismantled, the coal and fuel industries can do as they please, the environment and public health be damned.

The tax overhaul benefits primarily the Republican party’s backers, big corporations and multi-millionaires. It also comes with a provision to drill for oil in the Arctic National Wildlife Refuge. And this on top of huge rollbacks in natural reserves, opening up to private exploitation over 2 million acres in Utah.

The only area that has resisted the Trump-Republican onslaught is Obamacare, but not for long. As Trump said at the GOP tax bill celebration, “we peeled Obamacare because we got rid of the individual mandate which was terrible” which is, as he clarified, “a primary source of funding of Obamacare”.

Clever. One can only hope that the Republican party will come up with a solution for the millions of Americans slated to lose coverage. So far, there is none on offer. Foreign observers (myself included) marvel that America has still not accepted the principle of free universal access to healthcare, first launched in Germany in 1883.

Read the rest on Impakter, click here.

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I Support Net Neutrality!

Come and join me in this fight! Your freedom depends on it. Seriously. Read this excellent article written by my friend Hannah Fischer-Lauder – I am so happy to share it with you here, it’s just published on Impakter:

NET NEUTRALITY WAR: TRUMP WHITE HOUSE VS. SILICON VALLEY

by HANNAH FISCHER-LAUDER

On November 21, the new head of the Federal Communications Commission (FCC), Mr Ajit Pai, detonated a bomb on the Internet, announcing his plan to do away with net neutrality.

Why a bomb?

It’s very simple: eliminating net neutrality is a direct threat to consumers, start-ups and small businesses. A threat to all of us. It is the end of an open Internet. Anyone who cannot pay for access will be penalized.

IN THE PHOTO:  Internet user with a laptop. PHOTO CREDIT:  GLENN CARSTENS-PETERS on UNSPLASH

DOES MR PAI CARE?

No, despite the avalanche of pro-net neutrality comments that flooded the FCC website when it called for comments (as it must, by law), he disregarded what real people had to say to him. I write “real people” because the FCC website got so messed up – hackers even attacked it in May –  that, in the end, there were 22 million plus comments, most of them from bots.

Bots, fake comments on a government website? Yes, it’s not a joke. NY Attorney General Schneiderman on 21 November, in an open letter to the FCC Chairman, told him that in his estimation, hundreds of thousands of Americans’ identities were stolen and used in spam campaigns to support repealing net neutrality.

But there’s more.

Read the rest on Impakter, click here.

Be sure to go to the end of the article, it gives you tips (and links) on what you can do to help in the fight against the FCC planned repeal of net neutrality regulations. And there’s a lot you can do, sign petitions, write letters, share online. 

Mr. Pai has scheduled the FCC vote on repeal for December 14. There is no time to lose!

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Don’t Be Evil: The Other Side of the Tech Industry

Another one of my articles published on Impakter:

HOW TO ADDRESS THE TECH WORLD’S MORAL BLINDNESS

Who leads the tech world and what is their impact on the economy? Put together two remarkable statistics:

  • Of the ten richest men in America, only three are not tech billionaires: Warren Buffett and the Koch brothers;
  • Tech firms represent 21% of the 500 largest American firms, yet they employ only 3% of the workforce (Guardian, 2017);

and you get an exact description of the New Golden Age.

We’ve moved from the Robber Barons of the 1900s to the tech billionaires of the 2000s. Same concentration of wealth, same political and economic power, same income inequality, same moral blindness – with one big difference that hurts the working class: compared to the Robber Barons and the manufacturing giants of the 1950s, they create very few jobs.

Worse: The ‘frightful fives’ – Apple, Google (Alphabet), Amazon, Microsoft and Facebook, as noted by the New York Times’ columnist Farhad Manjoo –  are gobbling up start-ups, buying out the most successful rather than allowing healthy competition to develop. This puts the very process of innovation at risk. Instagram, WhatsApp, DeepMind are some of the better-known examples.

The rise of tech is affecting not just the economy, but our politics and culture too, twisting and straining the moral fibre of our society. In his 2016 speech at the Hiroshima Peace Memorial, Obama somberly noted that “technological progress without an equivalent progress in human institutions can doom us”. And he reminded us that “the scientific revolution that led to the splitting of the atom requires a moral revolution as well.”

The moral revolution certainly has not arrived in Trump’s America, focused for now on its America First agenda, denying climate change and trying to rebuild the coal-based manufacturing of the 1950s instead of addressing the real challenges of the future. Challenges that stem from tech industry AI products, robots and supercomputers, displacing jobs and ruining the middle and lower classes.

Tax havens are a big part of the story.

After the Panama Papers, we now have the scandal of another offshore firm, the Appleby files. Among Appleby’s long list of ultra-rich clients, including 31,000 Americans, we find a range of businessmen, pop stars and royals, including George Soros, the financier and philanthropist, Carl Icahn, the equity investor, Sheldon Adelson, the casino magnate, Madonna, Bono and even (for the first time) Queen Elizabeth II.

Inevitably, we find tech titans like Microsoft co-founder Paul G. Allen.

IN THE PHOTO: FROM LEFT TO RIGHT, PAUL G. ALLEN, GEORGE SOROS, BONO AND QUEEN ELIZABETH. SOURCE: COLLAGE FROM PHOTOS IN WIKIMEDIA COMMONS 

 

While bashing the tech industry on moral grounds has become fashionable, how useful it is in curbing it is debatable. After all, the tech industry has changed our lives, sometimes for the worse, to be sure, but also for the better. And the industry has many friends and supporters, not to mention ample lobbying power both in Washington and Brussels. And so long as the industry is making money, criticism, however right and morally grounded, will fall on deaf ears.

There are other ways to curb the tech industry and ensure it becomes a responsible citizen.

To read the rest on Impakter, click here.

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The World Number One Killer: Non-communicable Diseases

Here’s my latest article published on Impakter Magazine: 

Non-communicable diseases are the major global health issue that most people have never heard of. Yet it kills nearly 40 million people every year, more than traffic accidents (1.3 million) or scary communicable disease outbreaks like Zika and Ebola that do make it in the news, but rarely exceed 10,000 deaths. For example, the 2014 Ebola outbreak in West Africa killed 11,310 (latest Centers for Disease Control data).

NCDs include four major diseases that you can’t catch from someone else:

  • cardio-vascular diseases (stroke and heart attacks, 48% of NCD deaths),
  • cancer (21%),
  • chronic respiratory diseases (12%),
  • diabetes (3.5%).

This is not to belittle the threat or devastation caused by communicable diseases. Currently, the massive cholera outbreak in Yemen that has infected some 800,000 people in the past year and a plague outbreak in Madagascar that has killed nearly 100 people in two months are making the news. Rightly so, these are people in urgent need of help.

But NCDs should not be underestimated: They cause 70% of deaths globally, and nearly 50% of global disability. High-income countries are more affected than low-income countries (88% vs. 37%, 2015 data). As a result, there is a misperception that NCDs are a high-income country problem, but that’s not the case.

It’s a global problem.

And as I argue in the article, it’s a global problem the World Health Organization (WHO) has been addressing over the past two decades…almost single-handedly. To find out what is being done, click here. This is an issue I feel very strongly about, and it’s high time it be given the attention it deserves. The future of our children depends on it.

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