News: Tether pump fails, ETFs rejected, China blocks more exchanges, NotPetya ransomware, how FOMO3D was won, XYO goes Reg A+

Over half a billion new tethers have been issued in the past month, and what did they get out of it? A temporary $600 pump in the price of Bitcoin. It’s a reasonable question to ask if the price of Bitcoin is based on anything at all.

BITCOINERS: “will you allow an ETF in our hilariously manipulated commodity this time? Pretty please?”
SEC: lol

China is blocking offshore crypto exchanges even harder than previously — another 124 exchange websites that provide trading services to citizens on the mainland have just been blocked.

Andy Greenberg writes up the NotPetya ransomware, and how Russian malware took down Maersk, the world’s largest shipping firm. This is from his forthcoming book on the subject, Sandworm (US, UK) — released May 2019.

In crypto, it’s not just a matter of deciding, “I’m gonna scam some suckers!” You have to find the right suckers. Say, 100 suckers believing they’re buying one ETH from you, at 335 EUR each, before Google pulls your app.

How FOMO3D was won — spamming the contract with high-fee transactions, carefully calculated to outspend the other bots. The winner spent 125 ETH to get a 10,000 ETH prize pot. Analysis from Cthulhooo on /r/buttcoin, and a technically detailed piece by Andrew Munro in Finder. The possibility of it being worth someone’s while to DDOS you is almost never mentioned as a problem with smart contracts.



The XYO “ICO” to replace GPS with (handwaves) something, uh, blockchainy — they posit geocaches containing ETH payments — is dumb as hell. But the interesting bit is that, instead of doing an ICO that they would have had to make 506(c), for accredited investors only … they went through the paperwork to do a Reg A+ — and now they can sell to retail investors. (See KodakCoin’s misadventures with 506(c) and Reg A+.) They have Charlie Shrem on board as an advisor, because, as well as being a “tech pioneer and founder of one of its most respected foundations,” he has important experience knowingly money-laundering for drug deals on the Silk Road. Just the sorta guy any respectable disruptive innovator needs providing financial advice.

The shine’s coming off the “blockchain” buzzword — and Guardtime explain how the Estonian Blockchain Revolution works in practice: “We will have no problem doing a quick marketing switch when ‘blockchain’ becomes a negative, in order to return focus to our own category of KSI technology.” Told you so.

A Barclays report from April — Crypto technology: A solution still seeking a problem. “Despite tremendous hype over the potential for crypto technologies in money and finance — specifically, blockchain and distributed ledger technology — we see little likelihood of widespread adoption in any area in the near future. Crypto currencies may have a home in low-trust corners of the global economy, but broader adoption of crypto technologies faces critical challenges and strong incumbents.” Also, irreversibility is a crippling problem. They think smart contracts have potential, but incumbent technologies and institutions are still going to do better. Here’s the report — it’s well worth a read.

Bitcoiners make excuses for proof of work’s stupendous waste of power. Meanwhile, normal people hear how much electricity Bitcoin wastes and are outraged — in fact, they consider it a perfect example of the climate change crisis. So the answer to “whatabout this other thing” turns out to be “actually, let’s deal with Bitcoin first.

There are a zillion cryptocurrency scams, and quite a lot are old scams with a new coat of paint — per chapter 4 of the book, crypto scammers often turn out to be serial scammers. Bennett Tomlin was particularly outraged by the Billion Coins Scam, a pyramid scheme shaped like multi-level marketing.

I wasn’t exaggerating in chapter 3 of the book either — there are Bitcoiners who honestly believe that, come the collapse of civilisation, they’ll still have reliable access to high-powered computing machinery, Internet and electricity in the grim meathook Mad Max petrolpunk future. And we can use colloidal Litecoin as antibiotics.



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