Bitcoins/Litecoins/Virtual Currencies

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Flobee

Flobee

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maskedmelon said:
Okay, maybe I will try out kraken then. They will allow me to transfer the coins to a hardware wallet? Also, what happens is the hardware wallet dies? I just want to buy a few coins and hold them, so I would most likely just place the hardware wallet in a safe deposit box.
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Yea, I've used Kraken and sending to a hardware wallet is simple. Note that Kraken does not currently support ACH so you'll need to wire them the money. Since they got approved for a banking license I assume this will change.

Your hardware wallet will come with a recovery phrase (12ish words) that you can use to recover the wallet even if the physical one you own is destroyed. You simply need to save or memorize the recovery phrase. Lose the phrase and you can't recover your wallet if its lost. Please don't put your recovery phrase online or on your computer. It probably won't get stolen, but if it does you lose everything.
 
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www.icij.org

Global banks defy U.S. crackdowns by serving oligarchs, criminals and terrorists - ICIJ

The FinCEN Files show trillions in tainted dollars flow freely through major banks, swamping a broken enforcement system.
www.icij.org www.icij.org

$2,000,000,000,000 laundered by international banks against US sanctions.

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I'm willing to bet this will be used as justification for the formation of Central Bank Digital Currencies during the upcoming world financial reform. Gov will be taking full control over the currency. On the plus side it will be debt-free issuance which is a better fiat system. Down side being that it is a complete capitulation of financial privacy. Keep in mind the war on cash was won during COVID-19.

Buy Bitcoin.

“I don’t believe we shall ever have a good money again before we take the thing out of the hands of government, that is, we can’t take it violently out of the hands of government, all we can do is by some sly roundabout way introduce something that they can’t stop.” – F.A. Hayek 1984
 
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decrypt.co

Institutional Investors Say They’ll Buy More Bitcoin: Survey - Decrypt

Cryptocurrency investments could be on the rise from pension funds and insurers, but some concerns still linger.
decrypt.co decrypt.co
Evertas surveyed investors that oversee some $78.4 billion worth of collective assets, and 64% of respondents reported that they expect a slight rise in crypto investments from the likes of pension funds, family officers, insurers, and sovereign wealth funds.

Meanwhile, a further 26% of respondents believe they will “dramatically” increase their investments in Bitcoin and other cryptocurrencies over the next five years. All told, that’s 90% of surveyed institutional investors that expect some increase in crypto holdings in the next half-decade.
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Pensions coming into the market seems like a big deal considering the percentage of GDP held in pension funds

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Flobee

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Very level-headed explanation of the effects of the Pandemic on the economy from the Cleveland Fed.

www.clevelandfed.org

sp 20200923 payments and the pandemic

Speech by Loretta J. Mester, President and Chief Executive Officer, Federal Reserve Bank of Cleveland - Keynote Speech - 20th Anniversary Chicago Payments Symposium - Federal Reserve Bank of Chicago - Chicago, IL (via videoconference) - September 23, 2020
www.clevelandfed.org www.clevelandfed.org

I specifically found this interesting regarding CBDC's

Central Bank Digital Currencies

The experience with pandemic emergency payments has brought forward an idea that was already gaining increased attention at central banks around the world, that is, central bank digital currency (CBDC). Legislation has proposed that each American have an account at the Fed in which digital dollars could be deposited, as liabilities of the Federal Reserve Banks, which could be used for emergency payments. Other proposals would create a new payments instrument, digital cash, which would be just like the physical currency issued by central banks today, but in a digital form and, potentially, without the anonymity of physical currency. Depending on how these currencies are designed, central banks could support them without the need for commercial bank involvement via direct issuance into the end-users’ digital wallets combined with central-bank-facilitated transfer and redemption services.8 The demand for and use of such instruments need further consideration in order to evaluate whether such a central bank digital currency would allow for quicker and more ubiquitous payments in times of emergency and more generally. In addition, a range of potential risks and policy issues surrounding central bank digital currency need to be better understood, and the costs and benefits evaluated.

The Federal Reserve has been researching issues raised by central bank digital currency for some time. The Board of Governors has a technology lab that has been building and testing a range of distributed ledger platforms to understand their potential benefits and tradeoffs.9 Staff members from several Reserve Banks, including Cleveland Fed software developers, are contributing to this effort. The Federal Reserve Bank of Boston is also engaged in a multiyear effort, working with the Massachusetts Institute of Technology, to experiment with technologies that could be used for a central bank digital currency. The Federal Reserve Bank of New York has established an innovation center, in partnership with the Bank for International Settlements, to identify and develop in-depth insights into critical trends and financial technology of relevance to central banks.10 Experimentation like this is an important ingredient in assessing the benefits and costs of a central bank digital currency, but does not signal any decision by the Federal Reserve to adopt such a currency. Issues raised by central bank digital currency related to financial stability, market structure, security, privacy, and monetary policy all need to be better understood.
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While they are saying that CBDC's are not currently planned what is planned and expected to release 2023-2024 is FedNow which seems to be a digital payment backend for "consumers and businesses alike". I have to imagine this would be a CBDC prerequisite.

I made a quick outline while I was reading the article for my own sake. Will spoiler it below if you want the cliffnotes version of the statement.

One big takeaway is that once we get through the current pandemic, making necessary investments to ensure that the U.S. payments system remains resilient in the face of extreme stress events will need to remain a priority...

...The spread of COVID-19 heightened the reliance of businesses and individuals on digital services and faster connectivity, as many employees began to work from home and consumers turned to online shopping...

...However, the pandemic does underscore the need to have a technology strategy that will meet the needs of the future. Industry efforts to replace decades-old core banking systems with more flexible, resilient, and cloud-friendly platforms, and to integrate the old with the new along the way, may need to be accelerated to ensure that we are prepared for the future...

…global demand for U.S. currency notes increased at unprecedented rates in March as currency orders from domestic and international banks spiked dramatically. At times of crisis, people often turn toward safety, and the U.S. dollar is viewed as a stable and safe asset across the world. So it is not unusual that the pandemic has led to a shift toward cash, but the scale has been unprecedented. Adding to that, the fiscal support in the form of economic impact payments issued by the U.S. government to millions of households also likely contributed to the higher demand in the U.S. as many people converted the payments into cash for spending...

...A consumer’s decision to use a different form of payment during the pandemic may have been driven by circumstances, but now that the consumer has had experience with it, that payment method may become a more routine choice. Similarly, some of the changes in work and consumption patterns may last after the pandemic has ended, altering payment mix and types of transactions more permanently...

...As many in this audience know, one of the goals of the Fed’s recent efforts to modernize the U.S. payments system is to speed up the flow of payments between payer and payees. Another goal is to make sure that all Americans have access to the payments system...

...The Federal Reserve’s FedNow service, which is currently being built, will be an around-the-clock service whereby payments can be originated, cleared, and settled within seconds. The service is expected to provide clear public benefits in the form of safety, efficiency, and accessibility of instant payments...

...The target release date remains 2023 or 2024...

...In addition to offering secure instant payments, an important goal of FedNow is to establish a nationwide reach for the service so that this new type of payment is broadly accessible to consumers and businesses alike...

...Thinking ahead, a service like FedNow, coupled with a directory service with accurate information on where to route payments for final distribution to households and businesses, has the potential to solve some of the challenges the government faced when distributing pandemic relief payments. Of course, creating such a directory and ensuring it is kept up-to-date is complex, and several challenges, including data privacy considerations, account information maintenance demands, and business case considerations, would have to be solved. The Federal Reserve understands the potential value of such a service, and has been exploring these issues as it evaluates the features to eventually include in FedNow...

Central Bank Digital Currencies
The experience with pandemic emergency payments has brought forward an idea that was already gaining increased attention at central banks around the world, that is, central bank digital currency (CBDC). Legislation has proposed that each American have an account at the Fed in which digital dollars could be deposited, as liabilities of the Federal Reserve Banks, which could be used for emergency payments. Other proposals would create a new payments instrument, digital cash, which would be just like the physical currency issued by central banks today, but in a digital form and, potentially, without the anonymity of physical currency. Depending on how these currencies are designed, central banks could support them without the need for commercial bank involvement via direct issuance into the end-users’ digital wallets combined with central-bank-facilitated transfer and redemption services.8 The demand for and use of such instruments need further consideration in order to evaluate whether such a central bank digital currency would allow for quicker and more ubiquitous payments in times of emergency and more generally. In addition, a range of potential risks and policy issues surrounding central bank digital currency need to be better understood, and the costs and benefits evaluated.
The Federal Reserve has been researching issues raised by central bank digital currency for some time. The Board of Governors has a technology lab that has been building and testing a range of distributed ledger platforms to understand their potential benefits and tradeoffs.9 Staff members from several Reserve Banks, including Cleveland Fed software developers, are contributing to this effort. The Federal Reserve Bank of Boston is also engaged in a multiyear effort, working with the Massachusetts Institute of Technology, to experiment with technologies that could be used for a central bank digital currency. The Federal Reserve Bank of New York has established an innovation center, in partnership with the Bank for International Settlements, to identify and develop in-depth insights into critical trends and financial technology of relevance to central banks.10 Experimentation like this is an important ingredient in assessing the benefits and costs of a central bank digital currency, but does not signal any decision by the Federal Reserve to adopt such a currency. Issues raised by central bank digital currency related to financial stability, market structure, security, privacy, and monetary policy all need to be better understood.
 
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Flobee

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I thought this article was very interesting regarding new international payment standards being adopted. This is especially interesting if you're familiar with other interface standards such an HL7 for medical data.

www.coindesk.com

The Standard About to Revolutionize Payments

Changing the standard way financial institutions communicate changes everything.
www.coindesk.com www.coindesk.com

This proliferation of messaging standards is a global phenomenon. The U.K.’s multiple payments systems each use a different one. The Faster Payments Service uses a modified version of ISO 8583, BACS (the UK’s ACH system) uses Standard-18, and CHAPS (its large value payment system) uses the SWIFT MT messaging format.
It is into this babel of standards that ISO 20022 is being ushered. The idea is to convert all existing payments systems from their own proprietary messaging standards over to ISO 20022. And so ISO 20022 will become the English of payments, a global lingua franca for transferring value electronically.
ISO 20022 isn’t new. The ISO began to devise the standard in the early 2000s. In the 2010s, a few trailblazing nations shifted over to it from their domestic standards. The Chinese are the leaders, having converted their main payment systems to ISO 20022 in 2013.

But most countries have yet to make the shift. The U.S.’s main large value payment system, Fedwire, was originally slated to start transitioning to ISO 20022 over a three-year period beginning in late 2020. But thanks in part to COVID-19, the start date has been pushed to at least 2022, which means that the final changeover won’t be complete till 2025 or so. The European Central Bank’s large value system, Target2, will start its transition in November 2022. The UK will switch in April 2022 in conjunction with a new real-time gross settlement system.
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Hilariously you actually need to PAY in order to see the entire standard's technical details:

www.iso.org

ISO 20022-1:2013

Financial services — Universal financial industry message scheme — Part 1: Metamodel
www.iso.org www.iso.org

My assumption is that this will be administered by the same people that run SWIFT (See the ISO 20022 for dummies book, hosted by swift.com lol) but will remove some of the control the west has over the money systems. Hard to tell though since you can't freely inspect the standard.

I would be curious to know how much 'extra' data an ISO 20022 transaction has when compared to a SWIFT transaction. How is privacy handled? I assume that this standard is chock full of Anti-Money Laundering regulations. What if anything are we going to be giving these people data-wise when this goes worldwide?
 
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I have a lot of respect for Eric Weinstein and hadn't seen his take on Bitcoin before this. Big brain analysis in the sense that he clearly sees what is coming.



Eric on Crypto and its role in the massive digital deflation we're currently undergoing (future of abundance)

This is an opportunity to create an as if physical layer inside of the digital layer so that the digital world will behave with scarcity. That world of scarcity is accessible to our markets. If markets are the engines of liberation then the promise of distributed computing, digital tokens, and smart contracts is the ability to create a layer with scarcity that will be within the reach of markets... If there is a retreat from the world of abundance, perhaps crypto will be our answer
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So this podcast is pretty in the weeds but they are making some really interesting points. Note that Moloch in this context is the opposing force to human coordination (see Meditations On Moloch). TL: DR you could think of political corruption and suppression of freedoms in our current system as a manifestation of Moloch. Their thesis is that Ethereum (could be any crypto really) represents the next human coordination system and will be how we work together in the information age. Really interesting concept.



Moloch is the god of human coordination failure; the reason why we can't have nice things; the embodiment of the Prisoners Dilemma. The story of humanity is a never-ending iterative process of discovering new tools and mechanisms to coordinate against Moloch. Is Ethereum the Sword that Humanity needs to finally slay Moloch? Why is Ethereum different than previous instances of coordination mechanisms, such as Religion or the Nation-State.
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I took the below SS a while back when I stumbled upon one of the guests on this podcast on twitter. His bio makes more sense now but I thought it was strange enough to save.

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EDIT: At the end they go into how this coordination system could be used to compel behavior. The example given is a MaskDAO that essentially publicly shames you for being without a mask in public by say, putting your picture on the wall of shame. You'd need to pay the MaskDAO money in order to be removed from this wall. There is some serious potential downside to these coordination systems if they aren't shepherded properly.
 
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Institutional money continues to pour into Bitcoin and the crypto ecosystem at large

www.forbes.com

Stone Ridge Reveals $115 Million Bitcoin Investment As Part Of Billion-Dollar Spinoff

A new bitcoin giant has emerged on the cryptocurrency scene. After three years of silence, the mysterious Stone Ridge spinoff also revealed it raised over $100 million and has more than $1 billion of cryptocurrency in custody.
www.forbes.com www.forbes.com

You can track Bitcoin holdings by publicly traded companies here:

BitcoinTreasuries.com

Track Bitcoin Treasuries of companies, miners and countries at BitcoinTreasuries.com.
bitcointreasuries.org

$6.4 Billion or around 2.8% of the total BTC supply held by public companies as of right now.

Some insiders suggest that there is a "wall of money" from corporations working through regulatory rails to invest into BTC. Things are looking very bullish for this sector and I suspect $10k is starting to look like a floor for BTC moving forward.

Ethereum has some bullish news of its own. Final testnet before ETH 2.0 phase 0 is complete. Grayscale's ETH trust has been approved as a SEC-reporting company.

EDIT: Forgot to add that there is some regulatory hurdles being thrown up by governments across the world regarding crypto. There is a Twitter thread by a lawyer that covers this very nicely here. TL: DR there are some attempts to remove your ability to own your own crypto keys. Exchanges may be required to verify ownership of any personally owned keys which will translate into not being allowed to transfer crypto out of exchanges at all. Attempts to create a walled garden similar to current banking system.
 
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... and here it is. Monetary reform is coming

www.imf.org

A New Bretton Woods Moment

"We can do better than build back the pre-pandemic world – we can build forward to a world that is more resilient, sustainable, and inclusive." - Kristalina Georgieva
www.imf.org

This, in my opinion, is the real reason we're having this pandemic. Leastwise the response that countries have had. Kill the old system to usher in a new one without a world war. Every previous change in reserve currency has come after a war.

Sovereign debut jubilee?
First, the right economic policies. What was true at Bretton Woods remains true today. Prudent macroeconomic policies and strong institutions are critical for growth, jobs, and improved living standards....
...keeping a careful watch on risks presented by elevated public debt. We expect 2021 debt levels to go up significantly – to around 125 percent of GDP in advanced economies, 65 percent of GDP in emerging markets; and 50 percent of GDP in low-income countries....
...Beyond this, where debt is unsustainable, it should be restructured without delay. We should move towards greater debt transparency and enhanced creditor coordination. I am encouraged by G20 discussions on a Common framework for Sovereign Debt Resolution as well as on our call for improving the architecture for sovereign debt resolution, including private sector participation.
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Accelerating gender equality can be a global game-changer. For the most unequal countries, closing the gender gap could increase GDP by an average of 35 percent.
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Access to the digital economy is a priority
And investing in our young people is investing in our future. They need access to health and education, and also access to the internet—because that gives them access to the digital economy – so critical for growth and development in the future.

Expanding internet access in Sub Saharan Africa by 10 percent of the population could increase real per capita GDP growth by as much as 4 percentage points.

Digitalization also helps with financial inclusion as a powerful tool to help overcome poverty.
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Not a ton of meat here, but just the fact that they're floating this is a big deal. With essentially every central bank investigating the creation of CBDC's I expect that crypto is going to become increasingly relevant in a new monetary policy.

Ignoring crypto in 2020 is like ignoring the internet in 1992

EDIT: Simon Dixon breaks this down
 
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Flobee

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Really great podcast overall. Naval is a unique individual. They go pretty deep into crypto at 1:02:32. I would suggest listening to the whole thing though.

 
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PayPal to allow cryptocurrency buying, selling and shopping on its network

Most interesting part of this imo:

Cryptocurrency payments on PayPal will be settled using fiat currencies, such as the U.S. dollar, meaning merchants will not receive payments in virtual coins, the company said
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So basically they're going to keep all the crypto that is purchased. I expect they will try to act like a crypto blackhole to suck up and keep as much as possible. They're not dummies, they know where the value is headed. Number go up.

Also sounds like they're going to support some alt coins as well. I expect this list to grow over time.

PayPal, which has secured the first conditional cryptocurrency license from the New York State Department of Financial Services, will initially allow purchases of bitcoin and other cryptocurrencies called ethereum, bitcoin cash and litecoin, it said. It partners with Paxos Trust Company to offer the service.
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While this is incredibly bullish for crypto, keep in mind that if you don't own your keys, you don't own your crypto. Self-sovereignty is a primary benefit of this technology. Great on-ramp though.
 
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OU Ariakas

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Flobee said:
PayPal to allow cryptocurrency buying, selling and shopping on its network

Most interesting part of this imo:



So basically they're going to keep all the crypto that is purchased. I expect they will try to act like a crypto blackhole to suck up and keep as much as possible. They're not dummies, they know where the value is headed. Number go up.

Also sounds like they're going to support some alt coins as well. I expect this list to grow over time.



While this is incredibly bullish for crypto, keep in mind that if you don't own your keys, you don't own your crypto. Self-sovereignty is a primary benefit of this technology. Great on-ramp though.
Click to expand...

Please God let them support TRX. The day that happens it will double.

This post is not at all related to my small position in TRX.
 
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OU Ariakas said:
Please God let them support TRX. The day that happens it will double.

This post is not at all related to my small position in TRX.
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Good luck man! TRX is, so far as I can tell, a ETH copy ghost-chain run by a Chinese scam artist Justin Sun. You'll probably get a pump when BTC goes up this cycle. Can get out with a profit then I imagine.

EDIT: Worth noting that owning some shitcoins is like a rite of passage for crypto. Everyone does it at least once

EDIT2: Upon further review. Don't buy crypto on Paypal

 
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Flobee

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So there is currently a narrative that BTC is decoupling from traditional markets. Obviously needs more time to be confirmed but looks good right now. TA folks say that next resistance level is around 12.5k. If that is broken its smooth sailing to ~13.8k then all clear to old ATH of 20k. I doubt we see that in the short term, but there apparently isn't a lot left between here and 20k+.

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Michael Saylor is the CEO for Microstrategy, the first publicly traded company to purchase Bitcoin as a treasury asset. I'd challenge anyone to listen to his analysis of BTC, why he thinks its the hardest asset in the world, and not feel like you're making a mistake by not owning some. He has some really fantastic analogies that vividly paint the financial picture from the perspective of a CEO.

He claims Bitcoin's stock to flow ratio is infinite, and that there is no other asset he would sell BTC for, ever.

They go into BTC around ~20 minutes in.
 
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LachiusTZ

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How does crypto hold value under the advent of quantum computing?

Is solving hashes not trivial and essentially exactly what they are best at?
 
Ravishing

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Who knows, but if quantum computing ever becomes reality I'd imagine the "difficulty" level will just be set extremely high to accommodate, idk how achievable that would be. Also, at some point the reward for finding blocks will be about nil, except for the transaction fees, so maybe breaking the 10 minute rule will be fine by then? Might just mean instant-transactions and lower energy usage, win/win.

But it's all theoretical of course.
 
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