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There’s news other than the crypto collapse! Time I did another of these. Amy is avoiding anything with NFTs in.
Killer civil servant
Eva Kaili was the biggest blockchain promoter in the European Parliament. She put forward motions in 2018 to promote blockchain and promote ICOs, and was putting together something in 2022 to promote NFTs. Anyway, Kaili got suspended from her Greek party and her EP party group in a stupendous corruption scandal involving lobbying for Qatar and several million euros in under-the-table cash payments. Her father was caught trying to flee with bags of cash. Kaili was arrested on 9 December and is still in detention as Belgian police sort out the mess. [CoinDesk; Le Soir, in French; La Vanguardia, in Spanish; Politico; EKathimerini; EKathimerini]
The Finnish tax authority published the names of all citizens who earned more than €100,000 in 2021. Top of the list was a crypto dude who reported earnings of €133.7 million and says he just typed in “1337” for teh lulz. He now owes €46.2 million in taxes. He claims a “typing error.” [Yle, in Finnish]
Turkish crypto exchange Thodex collapsed in April 2021 with $2 billion alleged value of cryptos missing, and CEO Faruk Fatih Özer promptly went on an urgent business trip. He was caught in Albania in August 2022. [The Block]
Andrés Velasco on The Unbearable Uselessness of Crypto: “Thanks to FTX, the world may have woken up to the grim reality that crypto is a get-rich-quick lie, wrapped in hype, bobbing on an ocean of libertarian technobabble. Will anyone do something about it?” [Project Syndicate, archive]
We Already Have Laws to Stop Crypto Fraud: Forget Washington’s urgency to design a regulatory regime for crypto. It’s better to treat it like any other illegal operation. [American Prospect]
Our government’s built on expense accounts
Not many people in Nigeria want the eNaira CBDC — its user base is around 0.5% of the population. The Bank of Nigeria is now going to try to bribe people to use it. [Bloomberg]
Reports that the Bank of Nigeria is restricting ATM withdrawals to promote the eNaira seem to have been made up by CoinTelegraph. The actual reason is they’re running out of notes as they’re changing the currency. [Bank of Nigeria, PDF]
The Bank of Nigeria would like more electronic payments. But that means the already-existing NIBSS payment system. The eNaira can’t scale, because it actually runs on a blockchain, or Hyperledger at least. The bank is talking to other companies about putting a different technology stack behind the eNaira — they’re not so happy with Bitt and Hyperledger. [Bloomberg]
The Bank of Korea finds that blockchain performance is hilariously unusable for a CBDC. Blockchains inspired the current round of CBDCs — and a huge driving force behind CBDC schemes was crypto number-go-up making banks take an unserious idea seriously — but you don’t want to actually use a blockchain. [Ledger Insights; Yonhap, in Korean]
China’s e-CNY (formerly DC/EP) is being trialed in more provinces. [SCMP]
In what I think is a first for a CBDC, the e-CNY is finally adding offline payments. I think Tenpay and Alipay don’t do this one either. Not sure about the claims that you can make payments on your phone when it’s out of power … [Yicai Global]
“While the e-CNY app has been made available for public download for about a year, it continues to be an uphill battle to convince consumers to use it” Officials insist the e-CNY is meant to replace notes and coins; the actual consumers just use it as a payment system like they do Tenpay and Alipay. [SCMP]
How is the Bahamas CBDC, the Sand Dollar actually doing? Not so well at financial inclusion, sadly. [LSE]
Xiao Yi, a top Chinese provincial official who was removed from his post in 2021, confessed on television to his crimes in supporting crypto currency mining. He was expelled from the Chinese Communist Party. While public forced confessions under communism have a number of unfortunate issues, perhaps here a case could be made. [SCMP]
Microsoft banned crypto mining from its Azure cloud in December — one of the last cloud providers to do so. [The Register]
The Hetzner cloud is finally kicking Solana nodes off. I remain a delighted customer of Hetzner. [U.Today]
All these fads, it’s shoulder pads
World Wide Web inventor Tim Berners-Lee wants us to “ignore” Web3 — “Web3 is not the web at all.” [CNBC]
The UK Parliamentary inquiry into NFTs has posted its written evidence submissions. Perfect for a game of blockchain bafflegab bingo. [Parliament]
Here’s Catherine Flick’s paper that uses the ACM Code of Ethics and Professional Conduct to show that NFTs are not ethical technologies. In case there was the slightest doubt. “Unless there is absolutely no other way to solve a problem other than using NFTs, then they should not be implemented, as there is currently no ethical use case or means of implementation of NFTs.” [Science Direct]
The Spectacular Collapse of CryptoKitties, the First Big Blockchain Game. [IEEE Spectrum]
BBC on the Trump NFTs, with a quote from me. [BBC]
Tracing the Trump NFT grift — an attempt to track down the licensee, NFT International. [Substack]
a16z Crypto advisor Packy McCormick was last seen failing to explain what Web3 was on Zach Weinberg’s podcast. [Twitter] Here’s some purestrain 200-proof a16z from Packy: the true power of NFTs is that evil companies can’t take away your big tiddy AI waifu.* “Now let me caveat that I’m not technical …” The origin story of Ethereum, but worse. [Substack]
* no, none of these words are in the Bible
In March 2022, Princeton University launched its Center for the Decentralization of Power Through Blockchain Technology. What a name! Donations were academic-washed from Mike Novogratz of Galaxy Digital, Joe Lubin of ConsenSys, Daniel Morehead of Pantera Capital and Peter Briger of Fortress. [press release]
One year later, co-director Andrea Goldsmith says the ongoing crypto disaster actually justifies the center! In the face of many other Princeton academics disconcerted at just how blatant this bit of academic-washing was. David S. H. Rosenthal discusses “this outbreak of ‘blockchain is the answer, now what was the question?'” [Bloomberg; blog post]
Tim Bray on that time he helped stop Amazon’s AWS cloud service from diving into blockchain head first. (“It wasn’t just me! Group effort.” — Tim.) [blog post]
Signal president Meredith Whittaker speaks of the future for Signal, and appears contractually obligated somehow not to actively repudiate MobileCoin — “but currently crypto is a sh-t show that we are observing carefully.” [Time]
Carry mi card
Mastercard’s New Payments Index 2022 claims frankly implausible levels of stablecoin usage for ordinary purchases in Latin America — “more than a third say they have made a payment for an everyday purchase with stablecoin.” [press release]
This would best be used as a screening question: does the respondent even know what a stablecoin is?
I emailed the PR contact asking where and when the survey was conducted, how it was conducted, and what were the precise questions asked. I’m sure they’ll get back to me in due course.
There are assorted longer versions of the results — none of which contain this remarkable claim. And none of which answer how they conducted the survey or what the actual questions were. Mastercard does try hard to conflate crypto with all other non-cash payment channels in these reports. [index page; press release; infographic, PDF; infographic, PDF]
Silvergate wrote off their entire $200 million investment in Diem, formerly Facebook’s Libra cryptocurrency, in their Q4 2022 earnings. Here’s the Q3 2022 earnings call where CEO Alan Lane admits that the regulators are just not going to let them do a retail stablecoin. “It’s certainly not a technology issue.” [Seeking Alpha]
The Australian Financial Review has compiled a list of Australian Dollar stablecoins. [AFR]
BBC Research and Development is doing an internal consultation on how the BBC as an organisation can use Web3 and DLT.
I originally said I’d be delighted to help, but I hadn’t read the consultation document I’d be “helping” with. if I had, I’d have offered to do it only for a swingeing fee.
The deeply unserious “analyst recommendations” document isn’t public yet, but it really should be. Should the BBC issue NFTs, or perhaps even its own cryptocurrency? Amazing. Marketing copy cut’n’pasted straight into the organisation’s brain.
The organisation made the usual error — they accepted the excuse “technology!” for the use of old tech to build a minimum viable product that’s just sufficient to support various unregulated financial instruments.
This is engineers making financial proposals to the organisation, not technological ones. I wonder to what extent they realise this.
My recommendation was that the correct BBC approach to DLT would be for BBC Business News to investigate these ideas in depth as ongoing frauds. I also recommended an internal investigation as to how this document got this far, with a view to ensuring it never happened again.
Tech journalist Casey Newton in his end of 2022 summary: [The Verge]
But all-out war between pro- and anti-crypto forces never really materialized, because the skeptics were just … right about everything!
How much crypto skepticism comes from people hitting the age where they never want to have to understand a new technology ever again?
It ended up being about $5K
my ethics policy needs a crypto update.
So it does.
New facts emerge
Tonantzin Carmona at the Brookings Institute put out a good report in October debunking crypto’s claims of financial inclusion. Crypto marketing throws around all sorts of claims about potential inclusiveness, with no attention to whether they contradict themselves — as long as they can prey sufficiently upon the disadvantaged . As I noted in the Libra book, no-one in crypto has come up with a coherent plan since they started using this meme in 2013. [Brookings]
Kicker conspiracy: football and crypto continue to be a disaster for the football side. How Wagmi United (yes, really) messed up Crawley Town FC — e.g., being sure they could run a football team much better than the ex-Arsenal manager they hired. [Guardian]
Gizmodo Australia ran an article in November on how you can lose money in crypto. I’m wondering if someone at the magazine was running articles through a synonym substituter. “Attack of the 15.24 m Blockchain” indeed. [Gizmodo, archive]
How To Buy Unvaxxed Sperm on Coinbase. The page itself shows up as a 404 for me — I guess unvaxxed sperm must be a security in the UK. Or maybe Coinbase needs to check whatever generates these pages a bit better. [Coinbase, archive]
David S. H. Rosenthal: Economic Incentives — why decentralised systems must be expensive and inefficient, and why anyone bothers with them. (The secret ingredient is still crime.) “A lower bound on the current cost of the lack of regulation of the cryptosphere is about $9B/year. The true cost is likely to be many times that lower bound.” [blog post]
The only use case for zero-knowledge proofs turns out to be Monero and ZCash — that is, money laundering and not even money laundering. Fais Khan: “I’m going to argue that ZKPs are part of the blockchain shell game. Because blockchains have so many technical faults, ZKPs are touted as a solution — and the two together are so confusing it’s easy to pass another complicated concept over our heads. Both are immature technologies where the perfect solution resides at some point in the future, and that’s the ideal formula for more influencers to shill their bags.” [Substack]
Blockchain: Innovation or Illusion? A 90-minute documentary video by r/buttcoin and r/cryptoreality moderator American Scream. I’m not in this one myself, but I’m delighted to point you at it. [YouTube]
James Jani: The Great Crypto Scam (54 min). I’m all through this one, as is Nicholas Weaver. [YouTube]
Here’s a good interview with Coffeezilla from May 2022 about his time on the crypto fraud beat. [New Yorker]
Recently had a wrong number message on WhatsApp from a women. We chatted for hours and she was incredible. I am married but had the first infidelity thoughts of my life. On day 4 she talked about Cryptocurrency and how much money I could make. Obvious scam. Felt so ashamed.
— Fesshole 🧻 (@fesshole) October 19, 2022
i just got asked to make a company a sponsored video and they said they'd pay me with an nft 💀
— Andrew (Beta64) (@Beta64Official) October 19, 2022
This is every podcast interview with a Web3 VC pic.twitter.com/pHbvTRWL9P
— Jason Knight (@onejasonknight) October 22, 2022
They're called digital assets because they go from 1 to 0
— Matthew C. Klein (@M_C_Klein) November 8, 2022
Crypto dudes are weirder freaks to me than Elon stans. Elon stans are just bootlickers, while crypto dudes are like "well I've fallen for 8 ponzi schemes but surely the 9th time's the charm"
— Joseph Fink, 👻🎃healthcare is a human right🎃👻 (@PlanetofFinks) November 12, 2022
children should learn Gambling basically asap aand fix the economy by winning big
— wint (@dril) November 25, 2022
— iucounu (@iucounu) December 13, 2022
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