Scam, pyramid scheme, environmental disaster: Vivaldi boss shares his thoughts on crypto-coins Vivaldi will not provide crypto-wallets in its browser because it doesn't want users to participate in digital coin trading – something CEO Jon von Tetzchner desribes as "at best a gamble and at worst a scam". The move comes a week after rival Mozilla dipped a toe in the crypto-waters, only to have it angrily bitten off. …
At least on Wall Street, for the retail investor / trader - most tradable products such as currency, shares, options and futures mostly have at least some tangible "thing" that underpins them, and that the spot price is derived from - hence "derivatives", and also a certain liquidity and volume that makes the trades somewhat easier to get into and out of.
The problem with Crypto - is there is nothing with any real tangible value that supports the price, other than herd speculation that someone will pay more than someone else paid for it, and that the price will keep going up. There is also no real tradeable volume.
Not the Government, the state or indeed just the people. Fiat currency doesn't disappear with a change of government or even of regime. Any not completely barking revolutionaries will honour the currency of the old regime because they don't want to inherit a non-functioning economy. They may however make modifications.
Or maybe not.
Everything goes to zero "in the end". But I see no reason why fiat currencies should be expected to get there any faster than crypto, or gold for that matter.
The US dollar has existed in an unbroken continuity since 1785. That makes it a veritable stripling compared with the British pound, whose history goes back to the 9th century. Sure, they've gone through changes and upheavals, wars and revolutions, but in all that time there has never been a time when the pound you had yesterday became worthless today.
"it is underpinned by the government and economy of that country"
-ish
It is underpinned by the trust / belief that everyone else in the country will accept the currency, and it becomes self-fulfilling - everyone accepts it because everyone accepts it.
In theory the value of each dollar (or whatever) should be backed by economic activity in the country, but because of the magic of fractional reserve (banks can lend 10 X as much money as they hold deposits), there is far more money than economic activity backing it up.
Also, central banks can 'print'* as much money as they feel is necessary to prop up the economy (although they can and sometimes do 'retire' some of this money as required). But these generate inflation, and with too much inflation comes loss of trust, which can lead to hyperinflation and money becoming worthless (at least as compared to things). It's not exactly a house of cards that will fall with 1 card missing, but pull out enough cards (eg large enough amount of people try to withdraw their savings at once) and the system might collapse.
With bitcoin (or whatever) it's the opposite. The finite supply means that looked at as a currency they are deflationary. People are reluctant to spend a deflationary currency** since it's perceived value is going up, but that stifles economic activity. In this respect bitcoin is no different to gold. The value of gold as an industrial metal or to make shiny things (ie its inherent value) is much less than its market value - the difference is made up by the belief of people in gold as a value store. As long as enough people believe bitcoin is worth something, it will, even if it doesn't continue to increase in value.
*not really printed, they just create it electronically and pass it on to the banks
**which is why central banks purposely target slight inflation for their currencies
> In theory the value of each dollar (or whatever) should be backed by economic activity in the country, but because of the magic of fractional reserve (banks can lend 10 X as much money as they hold deposits), there is far more money than economic activity backing it up.
I see transactions as activity. A bank note itself doesn't represent activity.
Fractional reserve banking creates more activity without creating more money. In the same way putting a room on Airbnb can create more renting without creating more rooms.
The value of real currencies is essentially the value of the economy to which it is connected. So for example you want to buy something from Japan then you need Yen, so you buy Yen. Lots of demand for Yen then drives the value up. But lots of demand for Yen means lots of trade with Japan, so it's really the strength of the economy driving the demand for the Yen which in turn drive the value of the Yen.
Of course there is speculation in currencies like there is in many things, but it's a small part of the overall market
>What tangible thing underpins a currency?
The assets and productive effort of that currency's society.
The idea can get a bit distorted when a currency like the US dollar becomes a reserve currency, there's a huge temptation to abuse its position, but the basic idea's sound.
Are you not generalising a bit?
https://edition.cnn.com/2022/01/12/africa/world-mobile-internet-balloon-zanzibar-spc-intl/index.html
What they do is crypto and mesh networks, pretty cool
On a green blockchain, no proof of work
And they sponsor Fulham
https://www.fulhamfc.com/club/club-partners/
Not a scam
I think I'm going to need to see a bit more citation or evidence for this supposed implied mutual exclusivity between these two. I see no reason at all they couldn't both be, so it's pretty unreasonable to say that one is, therefore the other isn't.
ETA: Yeah, it's really just rhetorical flourish, but this is one (of many) bit of rhetoric I really don't like at all.
In the US there are laws that try to discourage dealing in "securities" backed only by "The wide blue sky of Kansas" Those blue sky laws actually are enforced at times as are laws requiring some amount of truth in public statements. It'll be recalled that Elon Musk ran afoul of those. Heck, the US has even been known to put popular celebrities that do particularly outrageous things in jail for a few years -- e.g. Martha Stewart. So yes, Well Street may be a casino. But it's a regulated casino that tries to keep the actual odds in favor of the house close to the apparent odds.
It's hard to see how cryptocurrency fits into that picture.
I'd be more impressed with block chain if its supporters could demonstrate even one beneficial use. You'd think, for example, that block chain could somehow be used to conveniently authenticate Covid vaccination or for website login. But somehow that hasn't happened. So I think probably crypto's critics are correct. It probably really is a hive of ill considered, resource wasting, scams.
Regarding signing of vaccination status, check out the smart healthcare card format (SHC). Some areas already use it to issue digital vaccine statements that are cryptographically signed by a known entity (e.g. the state of California). No blockchain required, just ordinary cryptographic public key signatures of an agreed data structure.
Tangentially mentioned in this Grauniad article is an opinion on blockchain transactions:
"Jason Deane, chief bitcoin analyst at Quantum Economics, said he believed there were a host of advantages, including the offer of instant, virtually free, financial transactions carried out without the use of a third party, with certainty that there will be instant settlement, and that the current teething problems need to be put in perspective."
Instant? Maye if you compare those tens of minutes for a single transaction to handing over cash in person, but otherwise it doesn't mesh. If either or both parties are using public wallets there _are_ third parties involved, the "virtually free" is again an externality where others are verifying the blockchain, and those "teething problems" are actually matters that stem from the design, not from the implementation.
I think it's certainly arguable that Wall Street needs more regulation again. The ability to issue unlmited numbers of shares, combined with low interest rates, is essentially a licence for blue sky securities that are paid for by financial repression: you get nothing for your savings book, so how about some of these beans.
If only. The cold hard reality is that financial repression and the resulting allocative effect are now deeply baked into the entire financial system as they have been made to effectively serve the interests of both the rich and those lusting for political power. Basically they got there first and newcomers aren't welcome. Higher interest rates and lower asset prices would allow others to save up, benefit from compounding, and acquire assets at attractive cap rates. That's not going to be allowed.
For political cover, the fact that it would also bankrupt debtors is sufficient. Most people, having been encouraged to take on far more debt than they can handle at even very low rates, are left with a choice between fighting for the status quo and listening to the siren song of socialism and confiscation. Either way they end up broke, but thus far most people have correctly acknowledged that they're still better off with the status quo. Every now and then the leftist politicians, eager to purchase votes with cheaply borrowed money they won't personally have to repay, toss them a bone. Of course those bones still have a cost, it's just paid in inflation by the commoners. The results, well, look around; they speak for themselves.
The system is metastable. It can end only when some catastrophe makes it collapse. Meteorite impact, a pandemic orders of magnitude deadlier than COVID-19 or H1N1 (think airborne Marburg), the effects of AGW, or widespread violent revolution. The only events large enough to overcome inertia will also kill at least half the population and likely much more. I put choosing socialism in that set; at the productivity levels of the Soviet-era Warsaw Pact the global economy would be completely incapable of supporting the current population (indeed, only "humanitarian aid" allowed it to last as long as it did). On the plus side, a sustainably smaller population would alleviate the worst of AGW and ease the resource constraints that make financial repression so appealing to the elites. Perhaps our distant descendants will take these lessons to heart and adopt a zero population growth survival strategy.
In the meantime, I can appreciate why cryptocurrencies are succeeding. They look like a ticket out of poverty, and their absurd prices harness financial repression rather than fighting it. After all, if there aren't any assets out there you could ever hope to afford, why not create some out of nothing and sell them to greater fools? What you are seeing is a bifurcation: real assets are only for the elites; others will be allowed to own and trade only virtual assets backed by nothing and subject to strict regulation, monitoring, and taxation. The next obvious step is to reduce convertibility between them to ensure there is no vertical mobility.
Good luck, everyone!
"I'd be more impressed with block chain if its supporters could demonstrate even one beneficial use."
To be clear, I am not a crypto supporter in any way. But the blockchain concept I can see having uses in logistics. As goods move from manufacturers through distributors to retailers, I can see a blockchain that tracks the movements of specific good. Tie the goods to something important at the manufacturing stage - say, the lot id - then dealing with product recalls, food contamination etc. suddenly becomes a lot simpler, because the movements of goods are in the blockchain.
Is it worthwhile? I don't know. Society seems to be fine with 20,000 pounds of ground beef being recalled and destroyed, so maybe the economic costs involved aren't worth it.
But I do see this as a good use-case for blockchain technology.
I don’t see any reason why it has to be a blockchain rather than a regular database.
Regular databases tend to be controlled by a single entity, who then has to be trusted by all participants. Sure, there are methods that can build that chain of trust (where participants only have to trust their immediate 'neighbors'), but then you're already part way into a blockchain-like system. Plus, a single controlling entity can make entries disappear if they want to.
But indeed, what method you use to track a load of coffee beans or a side of beef is irrelevant if you can't verify whether that database entry or that blockchain is the one for the physical item you're looking at.
In that respect, with NFTs and cryptocurrencies the blockchain entry itself is the item of value, and thus can't be separated from it.
It fairly pointless mining on a "PC" anyway, compared to a dedicated hardware setup its going to be extremely unproductive & use a lot more power per coin mined
than a proper rig (hate to imagine how long it would theoretically take to mine a coin on a bog standard laptop or desktop & how much electricity it would use at a time of high energy costs, not to mention the pointless environmental damage of bitcoin etc)
It only makes sense to the likes of Norton etc. who don't have to pay power costs and benefit from scale (lots of inefficient computers will still produce some coins), but very much a mugs game for the punter
It fairly pointless mining on a "PC" anyway,
And in some places electricity is WAY too expensive (Like Cali-fornicate-you). It's basically costing the end user a SIGNIFICANTLY HIGHER AMOUNT (higher electric bills) in a hidden way. Anything above "idle" on the CPU has a cost. Modern CPUs are very efficient and only 'sip' power when idle. AND, they guzzle it (by comparison) when going "all out".
donation buttons are more efficient, and less irritating, even when not everyone donates.
"It only makes sense to the likes of Norton etc. who don't have to pay power costs and benefit from scale (lots of inefficient computers will still produce some coins), but very much a mugs game for the punter"
This is the textbook definition of an externality: Norton gets the benefits, the punter pays for them. And of course we all pay in the form of higher electricity prices and a further increase in AGW. Creation of externalities is always appealing, which is why one of the very few legitimate economic functions of government is their prohibition. But of course governments are too busy trying to do anything and everything else to do the few things they're supposed to.
I wasn't aware that it was happening in existing applications in general, but Vivaldi's inherited the (OG) Opera approach of implementing non-web browsing features in the browser (mail client and calendar; torrent client hasn't appeared as yet but was in Opera) so I think he's probably responding to or anticipating a feature request.
Blink-based browser all seem to advertise themselves as "access the internet" rather than "browse the worldwide web", so implementing non-browser internet-client functionality would seem apt. In the case of Email, you need a rendering engine anyway to display HTML messages. (In my ideal world they would not exist, but in this real one they do.)
Irrespective of certain commonalities between internet applications, the main reason that I used and loved the M2 email client in Opera is simply that it was so good. Nothing I've used since comes close in efficiently indexing the message content.
-A.
And I agree with you — I used to happily use the mail and torrent clients in Opera and might get around to using the mail and calendar in Vivaldi if Thunderbird stops improving, but if I want my browser to chew up my CPU I'll just try to perform basic browsing activities on any modern website.
This.
Moore's law not only kept making* computers more powerful, it also gave rise to a sort-of Anti-Moore's law which kept making software ever shittier and buggier, such that the combined computational effort to do a task has remained somewhat constant.
In the olden days of 56k, you waited a bit for the HTML to load. In the modern days, you have to wait a bit for the shitty surveillance creep-ware to finish spying before letting you read the news or watch kitties on the internets.
* I know, that this is quite a primitive interpretation of Moore's law, and I know that Moore's law isn't a law at all.
"The problem is that to extract actual money from the system you have to find someone willing to buy the tokens you are holding. And this is only likely to happen as long as they believe they will be able to sell them on to someone who'll pay even more for them. And so on, and so on."
"The entire crypto fantasy is designed to lure you into a system that is extremely inefficient, consumes vast amounts of energy, uses large amounts of hardware that could better be spent doing something else and will quite often result in the average person losing any money they might put into it."
Spot on. Those two paragraphs are probably the best and most succinct explanation that I've read of why cryptocurrency is a thing best avoided.
"Spot on. Those two paragraphs are probably the best and most succinct explanation that I've read of why cryptocurrency is a thing best avoided."
Completely agree.
But the issue is, it seems half the population (amongst any given set of people, including high rank bosses" seem to agree on this, while another half seems to believe crypto and NFTs is the future of human kind.
This last half is a complete mystery to me and keeps me wondering "what have I missed ? They all can't be so wrong !".
Fear Of Missing Out. The belief that not participating in something means you won't gain any supposed benefits of having done so.
Once having done so, you're now part of the mindless mob trying to sucker other folks into doing likewise by playing on their own FOMO.
The only way to win is not to play in the first place.
That would be if he'd be referring to the median. But what's commonly referred to as the average is the mean, and if you have 19 people with an IQ of 101 and one Farcebook user of 81, the average is 100 but there's just one below average, not half.
Although with large sample sizes with a Gaussian distribution mean and median tend to be close.
I think it's probably (no pun intended) fair to assume that when George Carlin was referring to "...the average person...", he was, correctly, taking that "person" from the (considerably; extremely) large set of "all people", the statistician's 'dream' of a large population on which to operate.
The mean, median, and mode would then tend to converge, to give us that much overused term: 'average'...but, then again, perhaps the assumption of a Gaussian distribution is not correct...
"..lies, damned lies, and statistics"---Mark Twain, et al
> This last half is a complete mystery to me and keeps me wondering "what have I missed ?
See also the 2016 EU referendum.
After the event I realised that you only need to persuade that half of the electorate having below average intelligence and add in some ideological nutters* to win a narrow majority**.
-A.
* I realise that some of the less-than-averagely-intelligent are also ideological nutters. Iain Duncan Smith comes to mind.
** A majority of the turnout, of course, representing a minority of the electorate, which itself excluded millions of people, like me***, upon whom the outcome was of supreme importance.
*** Resident outside the UK, but in the EU, for more than 15 years.
Anyone else have the fortunate experience of listening to Radio 4's NFT program? with people "genuinely interested in art" buying NFTs of "amazing digital art", that often they don't have exclusive rights over, and can't reproduce, are often sold in "batches", and not actually backed by any actual real LAWS, so although they can prove some sort of ownership via blockchain, in real life that amounts to absolutely nothing.....
What a pointless act.....
And yet, like crypto, the defense of those drawn to it is usually the patronising "you just don't understand it". No, we understand far better than you do...
Nothing like an El Reg cryptocurrency article to get everyone fired up on a Friday. The 'haves' versus the 'have-nots' come out in droves. The comments are always quite sporting!
Since there is no icon for making popcorn to watch the show, I guess I'll have to settle for a beer.
Vivaldi is focusing on being a useful browser thus is avoiding the latest fad. Whether cryptocurrencies are fundamentally fraudulent can be debated, I am not convinced of their long term viability, but the issue is whether software intended for some specific use (browsing is a good example) should even be mining in the background. I agree here with Vivaldi, miners can be installed by the user if they want but should not installed by a browser or other non-mining application.
"The problem is that to extract actual money from the system you have to find someone willing to buy the tokens you are holding. And this is only likely to happen as long as they believe they will be able to sell them on to someone who'll pay even more for them. And so on, and so on."
"The entire crypto fantasy is designed to lure you into a system that is extremely inefficient, consumes vast amounts of energy, uses large amounts of hardware that could better be spent doing something else and will quite often result in the average person losing any money they might put into it."
These two paragraphs need to be emailed to every politician anyone, any honest person, in the world, who has an interest in, and can directly influence, financial responsibility.
"Reader...consider yourself a member of Congress. Now consider yourself a blithering idiot. But I repeat myself."---Mark Twain
The notion of a blockchain is straightforward enough and its probably used widely already (although it won't be called a blockchain). What distinguishes crypto isn't the chain but the technique of distributed validation based on a nebulous proof of work. The idea of decentralization sounds attractive on the surface but in real life you get a concentration of verification because the systems used for proof of work are so power hungry that they'll live where power can be underpriced (and being proximate it makes it easier to get a consensus and so guarantee the reward). In reality decentralization and the proof of work are bogus concepts, they're the sort of thing that works on a small scale but has already proven too unwieldy for general use. Even the promise of anonymity is empty; tools exist to provide details of blockchain transactions and while a user might be an anonymous string of digits if they wish to convert this to convertible currency then that user is either going to have to identify themselves or risk falling foul of the legal system in one or more countries.
I'm more interested in e-CNY. I don't expect to use it but I am interested in how it is secured and how it i manages high volumes of transactions.
It is highly instructive to note that root word of "cryptocurrency"---"crypto"---comes from ancient (Attic) Greek, and that its meaning today is precisely what it was then, all those centuries ago:
κρυπτός (modern: kruptós): “hidden; secret; concealed”.
Sounds exactly like something you'd want in your portfolio...right?
One basic issue with a block *chain* is that it, by design, records every transaction since the beginning of time. And then you replicate this database of all historical transactions with every participant. Currency does not need memory. WIth a Euro coin (real or virtual), I don't care who paid for what with it yesterday.
"I own that $4.5bn of digi-dosh so rewrite your blockchain and give it to me, Craig Wright tells Bitcoin SV devs"
"Oh look, another High Court sueball over cryptocurrencies"
Gareth Corfield Wed 19 Jan 2022 // 11:01 UTC
https://www.theregister.com/2022/01/19/craig_wright_bitcoin_sv_high_court_sueball/
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